A recent review of climate science is further proof that we need to back those companies finding real solutions to global warming, says Ashden’s Anne Wheldon.
On Sunday, the Intergovernmental Panel on Climate Change (IPCC) released a summary of its latest review of global scientific research. This time it was on the mitigation of climate change – taking action to reduce the emissions of the greenhouse gases that cause climate warming, or removing them from the atmosphere after they have been emitted.
For me, the summary tells us:
– Emissions of greenhouse gases are increasing, and they will go on doing so unless we increase mitigation
– By the year 2100, emissions could be contained to levels that keep the increase in global temperature below 2C – a level where, on current thinking, we can probably avoid dangerous interference with the climate system
– This will need mitigation efforts to be ramped up on a global scale, starting right now. The longer we put mitigation off, the more challenging it will become
– If we get going on mitigation efforts right now, the negative impact on the global economy is likely to be very small – only around 0.05%
– The longer we put mitigation off, the greater the economic cost of achieving it
My initial reaction was a measure of relief that we still have the opportunity to contain global temperature increase without a major impact on the global economy. But the IPCC makes clear that the changes required will be significant and complex.
Focusing not just on what to do, but how to do it, is going to be crucial if we are to ramp up global efforts on mitigation.
The good news is, we are developing understanding all the time of how we can make the changes that are required – including developing technology, raising finance for mitigation measures, changing culture and behaviour and influencing decision makers.
Let’s take two of the topics identified in the IPCC report: urban development and finance.
Just over half of the world’s population currently live in urban areas, and the IPCC’s summary reckons this will increase to around two-thirds by 2050. Such speed of urbanisation is one of the reasons why taking action on mitigation is so urgent: the development of a new urban area ‘locks-in’ patterns of energy use in buildings and transport choices, and so their resulting greenhouse gas emissions. If high-emission choices are made, then they may last for decades.
But there are viable low-emission opportunities. In India, the IT giant Infosys confirms the summary’s comment that both retrofitting existing buildings and designing new ones can substantially cut energy use and emissions – and is also economically attractive.
And the work of Kéré Architecture in Burkina Faso is clear evidence of how elements of traditional materials and design can lead to high levels of energy service with much lower energy inputs. The company has designed and built schools that are naturally ventilated, making classrooms cooler and easier to study in.
In transport, a high priority in mitigation is to reduce the use of individual cars. Take the city of Toulouse in France. It has achieved an integrated approach to urban transport, making it easier to walk, cycle and use public transport, and so cut the use of cars. Aside from expanding and improving the public transport network, it works with businesses to help them incentivise employees to use more sustainable forms of transport, with smart travelcards that can be used across the entire transport network. These measures have resulted in a phenomenal 80% increase in public transport journeys.
Financing mitigation efforts
The IPCC summary estimates that between $343-385 billion (£205-230 billion) per year currently goes into mitigation and adaptation activities (mostly into mitigation). I was struck by the comment (page 32) that roughly two-thirds to three-quarters of the mitigation investment is from the private sector.
But it’s still not always easy to attract private investment.
This is why the work of Mera Gao Power in India and Off.Grid: Electric in Tanzania is so interesting. Both are businesses that supply electricity services to low income off-grid homes using solar energy.
In Uttar Pradesh, Mera Gao Power has created commercially viable solar-powered ‘mini-grids’ that are bringing clean electricity to rural Indian villages for the first time. Off.Grid: Electric uses mobile money to sell solar power as a daily service to its Tanzanian customers. Both have achieved this through private investment, not as a public-funded or charitable activity.
And there are new opportunities for sourcing private capital. Many in the UK and elsewhere would like their savings to be used in more environmentally beneficial ways. Abundance Generation’s user-friendly crowdfunding platform allows people to invest their money directly into renewable energy projects of their own choosing. With a minimum investment of just £5, investors get a financial return and the feel-good factor of joining the growing renewable energy movement in the UK. By doing so, they’re plugging a gap in access to finance for small-scale renewable energy developers.
All of these organisations are finalists for this year’s Ashden Awards. Now in their 14th year, the awards shine a light on organisations that are finding solutions to climate change, through renewable energy, improving energy efficiency and changing the culture of energy use.
Fourteen winners will be announced at an awards ceremony at the Royal Geographical Society on May 22. So watch this space to find out who will be this year’s sustainable energy trailblazers.
Anne Wheldon is a senior adviser at Ashden. Follow @AshdenAwards on Twitter to keep up to date with the pre-awards buzz.
Responsible Energy Investments Could Solve Retirement Funding Crisis
Retiring baby-boomers are facing a retirement cliff, at the same time as mother nature unleashes her fury with devastating storms tied to the impact of global warming. There could be a unique solution to the challenges associated with climate change – investments in clean energy from retirement funds.
Financial savings play a very important role in everyone’s life and one must start planning for it as soon as possible. It’s shocking how quickly seniors can burn through their nest egg – leaving many wondering, “How long your retirement savings will last?”
Let’s take a closer look at how seniors can take baby steps on the path to retiring with dignity, while helping to clean up our environment.
Tip #1: Focus & Determination
Like in other work, it is very important to focus and be determined. If retirement is around the corner, then make sure to start putting some money away for retirement. No one can ever achieve anything without dedication and focus – whether it’s saving the planet, or saving for retirement.
Tip #2: Minimize Spending
One of the most important things that you need to do is to minimize your expenditures. Reducing consumption is good for the planet too!
Tip #3: Visualize Your Goal
You can achieve more if you have a clearly defined goal in life. This about how your money can be used to better the planet – imagine cleaner air, water and a healthier environment to leave to your grandchildren.
Investing in Clean Energy
One of the hottest and most popular industries for investment today is the energy market – the trading of energy commodities. Clean energy commodities are traded alongside dirty energy supplies. You might be surprised to learn that clean energy is becoming much more competitive.
With green biz becoming more popular, it is quickly becoming a powerful tool for diversified retirement investing.
The Future of Green Biz
As far as the future is concerned, energy businesses are going to continue getting bigger and better. There are many leading energy companies in the market that already have very high stock prices, yet people are continuing to investing in them.
Green initiatives are impacting every industry. Go Green campaigns are a PR staple of every modern brand. For the energy-sector in the US, solar energy investments are considered to be the most accessible form of clean energy investment. Though investing in any energy business comes with some risks, the demand for energy isn’t going anywhere.
In conclusion, if you want to start saving for your retirement, then clean energy stocks and commodity trading are some of the best options for wallets and the planet. Investing in clean energy products, like solar power, is a more long-term investment. It’s quite stable and comes with a significant profit margin. And it’s amazing for the planet!
What Should We Make of The Clean Growth Strategy?
It was hardly surprising the Clean Growth Strategy (CGS) was much anticipated by industry and environmentalists. After all, its publication was pushed back a couple of times. But with the document now in the public domain, and the Government having run a consultation on its content, what ultimately should we make of what’s perhaps one of the most important publications to come out of the Department for Business, Energy and the Industrial Strategy (BEIS) in the past 12 months?
The starting point, inevitably, is to decide what the document is and isn’t. It is, certainly, a lengthy and considered direction-setter – not just for the Government, but for business and industry, and indeed for consumers. While much of the content was favourably received in terms of highlighting ways to ensure clean growth, critics – not unjustifiably – suggested it was long on pages but short on detailed and finite policy commitments, accompanied by clear timeframes for action.
A Strategy, Instead of a Plan
But should we really be surprised? The answer, in all honesty, is probably not really. BEIS ministers had made no secret of the fact they would be publishing a ‘strategy’ as opposed to a ‘plan,’ and that gave every indication the CGS would set a direction of travel and be largely aspirational. The Government had consulted on its content, and will likely respond to the consultation during the course of 2018. And that’s when we might see more defined policy commitments and timeframes from action.
The second criticism one might level at the CGS is that indicated the use of ‘flexibilities’ to achieve targets set in the carbon budgets – essentially using past results to offset more recent failings to keep pace with emissions targets. Claire Perry has since appeared in front of the BEIS Select Committee and insisted she would be personally disappointed if the UK used flexibilities to fill the shortfall in meeting the fourth and fifth carbon budgets, but this is difficult ground for the Government. The Committee on Climate Change was critical of the proposed use of efficiencies, which would somewhat undermine ministers’ good intentions and commitment to clean growth – particularly set against November’s Budget, in which the Chancellor maintained the current carbon price floor (potentially giving a reprieve to coal) and introduced tax changes favourable to North Sea oil producers.
A 12 Month Green Energy Initiative with Real Teeth
But, there is much to appreciate and commend about the CGS. It fits into a 12-month narrative for BEIS ministers, in which they have clearly shown a commitment to clean growth, improving energy efficiency and cutting carbon emissions. Those 12 months have seen the launch of the Industrial Strategy – firstly in Green Paper form, which led to the launch of the Faraday Challenge, and then a White Paper in which clean growth was considered a ‘grand challenge’ for government. Throughout these publications – and indeed again with the CGS – the Government has shown itself to be an advocate of smart systems and demand response, including the development of battery technology.
Electrical Storage Development at Center of Broader Green Energy Push
While the Faraday Challenge is primarily focused on the development of batteries to support the proliferation of electric vehicles (which will support cuts to carbon emissions), it will also drive down technology costs, supporting the deployment of small and utility-scale storage that will fully harness the capability of renewables. Solar and wind made record contributions to UK electricity generation in 2017, and the development of storage capacity will help both reduce consumer costs and support decarbonisation.
The other thing the CGS showed us it that the Government is happy to be a disrupter in the energy market. The headline from the publication was the plans for legislation to empower Ofgem to cap the costs of Standard Variable Tariffs. This had been an aspiration of ministers for months, and there’s little doubt that driving down costs for consumers will be a trend within BEIS policy throughout 2018.
But the Government also seems happy to support disruption in the renewables market, as evidenced by the commitment (in the CGS) to more than half a billion pounds of investment in Pot 2 of Contracts for Difference (CfDs) – where the focus will be on emerging rather than established technologies.
This inevitably prompted ire from some within the industry, particularly proponents of solar, which is making an increasing contribution to the UK’s energy mix. But, again, we shouldn’t really be surprised. Since the subsidy cuts of 2015, ministers have given no indication or cause to think there will be public money afforded to solar development. Including solar within the CfD auction would have been a seismic shift in policy. And while ministers’ insistence in subsidy-free solar as the way forward has been shown to be based on a single project, we should expect that as costs continue to be driven down and solar makes record contributions to electricity generation, investment will follow – and there will ultimately be more subsidy-free solar farms, albeit perhaps not in 2018.
Meanwhile, by promoting emerging technologies like remote island wind, the Government appears to be favouring diversification and that it has a range of resources available to meet consumer demand. Perhaps more prescient than the decision to exclude established renewables from the CfD auction is the subsequent confirmation in the budget that Pot 2 of CfDs will be the last commitment of public money to renewable energy before 2025.
In short, we should view the CGS as a step in the right direction, albeit one the Government should be elaborating on in its consultation response. Its publication, coupled with the advancement this year of the Industrial Strategy indicates ministers are committed to the clean growth agenda. The question is now how the aspirations set out in the CGS – including the development of demand response capacity for the grid, and improving the energy efficiency of commercial and residential premises – will be realised.
It’s a step in the right direction. But, inevitably, there’s much more work to do.
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