"A carbon price is not enough"

I've just spent some time in New York & had a chance to attend the "State of the Planet 2008"

They had an interesting session on "Identifying Energy Solutions for Sustainable Development". The main conclusion of the panel was that putting a price on carbon is a good thing ... but it is not enough. Government's need to get involved directly in funding key technologies such as Carbon Sequestration.

This is also the conclusion of Jeff Sachs (who was also involved in the discussion) new book Commonwealth.

Its certainly got me thinking & is a contrast to the UK Government's policy of not picking winners.

George Bush on Iraqi "wealth"

In an interview with Charlie Rose (around 27 min on the video), in a response to a general question on Iraq's economy:

" as opposed to Afghanistan which is poor, Iraq's got a good, you know kinda fundamental basis for wealth and that is ... alot of untapped reserves"

It takes alot more than oil reserves to make a country wealthy, just ask the citizens of Angola or Nigeria.

Paradoxically being a poor nation with mineral reserves can be a curse (known as the "resource curse") & can contribute to economic stagnation.

Oil Majors & Renewables Business

I'm interested to see that BP is having trouble with its renewables business. Shell is having similar issues & has sold off its PV business.

I wonder if this signals the decline of Big Oil companies. If BP, Shell and others can't diversify away from oil&gas, then in the long term (30 years) they are eventually going to fold. Already they are having trouble replacing their reserves. Very few companies manage to survive a major shift in the market - which a move away from fossil fuels and to sustainable energy will be. A well known study shows that only 16% of large companies managed to survive over a 36 year period surveyed. Big companies find it difficult to change.

I'm not surprised that BP & Shell are having trouble with their renewables business - they have no competitive advantage other than access to capital. They also seem to have invested in everything (Wind, Solar, Biomass, ...), rather than focus their efforts on one technology. I think the only way they are going to be successful in the long term is to focus their efforts on the one technology they do have experience and an advantage in, which is Carbon Sequestration.

Nicolas Stern Lecture

I've just watched a lecture, by the author of the Stern Review.

I thought it was excellent. Interestingly he also notes that the current government target of 60% emissions reductions by 2050 is not enough & he expects the government to increase that to 80% over the next few years (which is similar to the calculations I made in a previous post)

I was also interested to hear he proposes using Biofuels for aviation ... which is something I've also mentioned.

He also believes that we can deal with climate change without becoming Buddhist monks riding bicycles. We can do without significant lifestyle changes.