GREEN BUSINESS
Winning the Sustainability Battle:
Interview with Jigar Shah of Carbon War Room
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In
establishing the Carbon War Room (CWR), Richard Branson, the British-born media and aviation billionaire, explicitly treats the threat of catastrophic climate change as one similar to the threat posed by a world war. Taking this metaphor a step further, Branson appointed
Jigar Shah as his general to head up the CWR. Nearly a year into the mission, however, Shah seems palpably frustrated.
Speaking with
Joel Makower at GreenBiz.com's State of Green Business Forum in Washington, Shah emphasized that the foot soldiers in this mission—companies, policy makers and voters—are waging a losing fight in this multi-decade struggle.
Shah reminded the audience that global greenhouse gas emissions are running at about 50 gigatons per year today, and are on track to grow to 60 gigatons by 2020 if economic growth and climate trends continue without change. To avoid a catastrophic climate change of 2 degrees Celsius or more, scientists say we need to trim 17 gigatons from that trend by 2020.
Not surprisingly, technology is ready to help solve the problem, says Shah, who earned a reputation as the founder of solar energy pioneer SunEdison in 2003.
"You've got
Bjorn Lomborg saying we can't do anything without more R&D. And policy people saying unless we pass a price on carbon, we can't do anything," said Shah. "That's just poppycock." The deeper problem is a tendency to grasp at feel-good solutions without reaching for harder, far more impactful steps. Shah offered the example of turning off the taps while brushing your teeth: it's a painless, feel-good behavioral change promoted by countless green living advice columns. Yet compared to the 40 percent of water wasted through leaking pipes across our crumbling water networks, it's meaningless.
While Makower suggested you could pursue both lifestyle changes and long-term infrastructure goals, Shah batted back, "It’s an either-or decision no matter how much we'd like to think otherwise.” "There are very few people who react to [environmental messages]. So when an NGO sends a mailing to 20 million people telling them to turn off their taps, they could just as easily say the more important thing to do is to fix the infrastructure. But the harder sell is too rarely made,” said Shah, adding that the problem is compounded by the failure of incomplete information. With scant understanding of the scale of the climate change challenge, good intentions get diluted.
For example, consumers have been drawn to hybrid vehicles as a fix for the problem, with upwards of 300,000 sold yearly worldwide. But putting that figure in perspective, "It would take 300 million Priuses to save a gigaton of carbon. That's about four times the total number of cars likely to be sold this year. And if the goal is to squeeze 17 gigatons from the world's emissions, such steps don't amount to much. It's fine to buy green cars, but to think of them as the solution to climate change is not.”
Such messages may sting the ears of corporations banking on sustainability and green product strategies, but Shah is confident there are countless opportunities to make meaningful cuts in emissions, and still make money. The market isn't always good at finding them however. "If I could solve this entire problem with a phrase, I would say climate change opportunities are
the largest wealth creation opportunity on the planet," he said. In reality every meaningful strategy with gigaton potential is a complex challenge.
That complexity can be decoded. Consider CWR's focus on the ocean-borne shipping industry
which accounts for 2-3 percent of global emissions, and staggering amounts of conventional pollutants. In a classic case of
tenant-landlord economic inefficiency, since customers pay for fuel, a boat's owner has no strong incentive to splurge on efficiency upgrades. In one of its projects, CWR identified 40 technologies that saved fuel for shipping. These include lubricant paint, advanced propeller designs, and air-hull lubrication systems. But none were being implemented because boat owners don't pay for fuel; they pass the costs on to shippers. To right this problem, CWR found a way to amass and publish data on the efficiency of 95 percent of the world's ships. When CWR talked to them about upgrades, "the ship owners said, we knew about these technologies, but weren't going to change until customers asked for it," Shah explained. The result is that today, shippers are asking for only the most efficient ships, so older ships aren't being used, and are losing money. That's causing their owners to either upgrade or junk them.
By righting the "information asymmetry," Shah estimates 450 million tons less carbon dioxide will go into the atmosphere by 2020. That's a big bite of the 17 gigaton goal.
The failure to aim for bigger emissions reductions, Shah speculated, is partly caused by the atrophy of abilities to deploy big, long-term projects. "No one has done infrastructure correctly in 30 years or more," Shah said. "Most corporations don't even know what it looks like to do infrastructure correctly any more. During the '50s and '60s when highways were built across the country, and the grids were built, there was a system that people understood," planners understood how to use eminent domain; lawyers, engineers and accountants all had fluency in this process. "Today, it's all lawsuits. So a company throws up their hands and sponsors the London Marathon instead."
Frustrated as Shah is, he's offered a ray of hope that the global climate war can be fought most effectively at the local level, in the trenches of local planning meetings and elections. "The transformation starts locally," he said. "The way you win this thing is to get people in the room. Most public utilities commissioners have never seen 10 people in a room. When they're doing a water permit for a new coal plant, if 50 people showed up and said we'd rather have a neighborhood, they're going to choose the neighborhood."
Originally published here.
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GIL 2011: Europe
London, United Kingdom
May 17-18, 2011
GIL 2011: Japan
Tokyo, Japan
July 12, 2011
GIL 2011: Korea
Seoul, Korea
July 14, 2011
GIL 2011: Africa
Cape Town, Africa
August 25, 2011
GIL 2011: Silicon Valley
San Jose, CA
September 11-14, 2011
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