In the middle of some of the most turbulent political and economic crises of modern times, UN climate negotiators will meet in Durban, South Africa, on November 28th. Their greatest challenge will be making their voices heard above the noise of the ailing Eurozone and the other pressing financial concerns facing the international community.
Creating a low-carbon economy is seen as a burden on the state and a drain on public funds, but in fact economic and environmental forces should work in harmony. This requires political courage though, and it is vital that the 20,000 negotiators and stakeholders at Durban show the determination required to find sustainable solutions that can both speed up activity in the low-carbon economy and mitigate the economic crisis. They must do so immediately.
In an interview with the Financial Times, former US President, Bill Clinton, said: “For $ 1 billion invested in a new coal plant, you get fewer than 900 jobs; for solar you got 1,900 jobs, for wind turbines 3,300 jobs and (for) retrofitting buildings 7,000 – 8,000 jobs… Here are the jobs, here is the investment. Are you really against it?'”
As well as creating jobs, a low-carbon economy offers a way out of our current financial mess. Environmentally sustainable solutions have proven to be hugely profitable whilst simultaneously protecting economies from the volatility of markets reliant on oil and other finite resources. As a long-term solution, a low-carbon economy it is achievable feasible, but it requires political willpower.
The success of low-carbon enterprise in the private sector offers compelling evidence for this stance.
California’s Tesla motors raised $ 226 million dollars for investors when it went public in 2010. Tesla’s goal is to accelerate the world’s transition to electric mobility with a full range of increasingly affordable electric cars. The company has delivered more than 2,000 Roadsters, the world’s first electric sports car, to customers worldwide. Model S, the first premium sedan to be built from the ground up as an electric vehicle, goes on the market in mid-2012.
Tesla’s cars are sold out until 2013 and other similar companies are profiting from this profitable market. Stanley Morgan projects that by 2025, 25 per cent of the world’s fleet of cars will be electric. If Tesla keeps just 1% of this market, it is easy to see how successful the company will be and how much investors will profit.
Governments must do more to encourage investment in these sustainable and lucrative ventures. They must also work to support the NGOs that are doing exactly this, such as the Carbon Disclosure Project that has successfully engaged over 500 independent financiers who manage over $ 71 billion of investment funds to put part of these funds in sustainable businesses.
Alternative investment policies in Scandinavia provide a model of how to utilize market forces in the transition towards a low-carbon economy. Sweden, for example, is the only country in the world where the national use of bio energy (32%) is higher than fossil fuel (29.6%), and the private companies that produce it have generated healthy returns for investors.
Of course, the Swedish government has encouraged this unprecedented feat by creating a green tax system. As any start up, bio-fuel producers often needed some financial support before they are fully profitable.
Politicians would do well to look to models like Sweden’s for inspiration, but they must also put the burdens of subsidy into context. According to the International Energy Agency (IEA), global subsidies for fossil fuels amounted to $ 409 billion in 2010 whilst just $ 64 billion went towards renewable energy.
And it is not simply a case of reallocating financial recourses, but about effectively using that money as a catalyst to stimulate the potential markets for sustainable energy. In 2011, the EU allocated (or at least pledged to allocate) € 27bn towards reducing the damage of climate change. If invested wisely, this sum could make a significant contribution in moving towards a low-carbon economy, whilst creating jobs and improving living standards at the same time.
We are however, running out of time. To keep global warming below two degrees, the world’s countries must immediately reduce their emissions by six per cent a year, according to Johan Rockström, Head of the Stockholm Environment Institute.
Are the delegates and stakeholders in Durban going to continue to stall the radical changes we, the 99%, deserve and need, or are they prepared to go beyond business as usual?