Waiting for the low carbon revolution

Andrew Pendleton, BBC Green Room 21 Jul 09;

The low-carbon revolution is not going to happen by itself, says Andrew Pendleton. In this week's Green Room, he calls on governments put the necessary frameworks in place that will allow the private sector to roll out the technologies needed to deliver the ambitious cuts in emissions.

In the early 1980s, consultants McKinsey completed a study for a US telecoms company predicting there would be fewer than one million wireless subscribers in the US by the turn of the century.

Today, nearly 2.5bn subscribers across the globe are using digital wireless technologies for voice, email, internet access, music and video services.

The firm is now at the forefront of predicting how different, climate-friendly technologies will help us reduce greenhouse gas emissions and at what cost.

In general, its message is helpful and optimistic suggesting, as former British Prime Minister Tony Blair argued recently, that much of the technology we need to fight climate change in the next decade is within our grasp.

However, we should be wary of predictions based on the status quo.

Last week, the UK government published an ambitious plan for transforming the British economy into one that is not only powered by low-carbon technology, but whose transport, housing and manufacturing are climate-friendly too.

The plan is to be applauded, as it signals a significant shift in climate policy from the lofty ideals of the climate change bill.

Its emissions reduction targets also suggest an approach that might best be termed "getting down to business".

The plan is certain to come in for some stick; and probably from several different angles at once.

The green campaigners, while broadly welcoming it, are generally of the view that it does not go far enough.

The acknowledgement that implementing the plan will increase household energy bills leaves the government open to attack from political opponents and consumer groups. Certainly, one could quibble with some of the detail.

However, the message sent out by the very existence of a centrally planned, government-led, economy-wide response to climate change is loud and will be heard beyond Britain's shores.

Carbon copy

It is a message that chimes with the results of a study recently completed by the Global Climate Network, an international coalition of think tanks of which IPPR is a founder member.

Our research involved speaking to more than 100 leading business people, government officials and academics in eight countries: Australia, Brazil, China, Germany, India, Nigeria, South Africa and the US.

We reached three conclusions:

First, we have argued that a low carbon technology revolution will not simply happen, but requires government intervention of the sort the UK government announced last week.

Our research clearly shows that one of the major barriers to low-carbon technology is the lack of coherent policy at the domestic level in both industrialised and developing countries.

A progressive strategy would include tough carbon standards for specific products or sectors, tax incentives to drive investment in low-carbon energy, structural changes to energy markets to encourage renewable energy and energy efficiency and, finally, much greater government support for research, development and demonstration of new inventions.

The need for finance is our second conclusion. This is inescapable and logically follows on from the first conclusion.

Almost all of those whom we interviewed in our study identified the lack of upfront finance as being a major barrier to low carbon technology.

While the private sector may well eventually be the main source of low carbon finance, governments have to lead to make new technologies cheaper and less risky, both with technology policies and with public finance.

Third, we call for an International Technologies Initiative, which could help accelerate the development of new technology through collaboration.

'Valley of death'

The so-called "valley of death" that lies in between invention and commercialisation in which many great ideas perish cannot be allowed to kill off important low carbon inventions.

Some will baulk at the suggestion that governments should have such a strong role in driving new, low carbon technology; there will be muttering about the dangers of nations "picking winners".

Yet the overwhelming conclusion of our study is that the low carbon technology revolution will not happen of its own accord; it will require a strong, interventionist approach including technology policy.

Later this year in Copenhagen, the world's environment ministers will come together for what is in theory a meeting to put the finishing touches to a new, global climate change agreement.

Currently however, the preparatory talks are deadlocked because developed countries refuse to accept ambitious emissions reduction targets and, as a result, developing countries refuse to talk about targets at all.

In truth, governments on either side of this divide do not fully understand how even the less ambitious of the targets on the table will be reached.

It is IPPR's view that greater emphasis needs to be placed on getting the technology we all need demonstrably working, and developed government-led financing needs to draw in the big bucks from the private sector.

We should not look to the low-carbon future as the study of subscribers to wireless technology did in the 1980s.

This will lead to timid policymaking and defeatism in the face of the great global threat of climate change.

Instead, governments should get down to the business of setting technology policies today that at least stand a chance of delivering a low-carbon revolution tomorrow.

Andrew Pendleton is senior research fellow at IPPR, a UK public policy think-tank

The Green Room is a series of opinion articles on environmental topics running weekly on the BBC News website