Solving Climate Change – Follow the Money
Peter Meisen, Global Energy Network
Climate change is the challenge of our time. It’s not our only global problem: terrorism, water shortages, fishery depletion, pervasive hunger and poverty all persist on the planet. Yet climate affects everything, and how we deal with this issue will make matters better or worse for all the rest.
Over the past century, our energy investments have created a wealthy, dynamic global economy. We now understand that continuing this path is unsustainable as fossil fuel resources decline and environmentally destructive carbon dioxide emissions accumulate -- threatening our economy and way of life.
The only way to shift the direction of climate change is to shift our energy investments.
The International Energy Agency projects that $9-$15 trillion will be invested in the next few decades to meet the world’s growing energy demand. To tackle climate change, it is essential that renewables, clean technologies and energy efficiency receive the lion’s share of this investment.
Entrepreneurs, venture capitalists, pension funds and individual investors will drive this transition – and benefit handsomely. Formerly known as "alternative energy," this new sector has become mainstream, creating thousands of new jobs in research and manufacturing. The opportunities are global, as India and China strive to raise living standards of 2 billion people. So far, these two nations have followed the same energy path as the west. Solving climate change will require both the west and east to cooperate and invest in the transition from fossil fuels to renewables.
Growth rates for renewables are impressive, with wind and solar industries increasing 20% - 40% each year since 2000. The commercialization of these renewables has attracted Shell, General Electric, British Petroleum and other energy multinationals to initiate significant financial commitments. Yet solar, wind and geothermal remain less than 2% of the global energy mix, even though some experts suggest that these renewables could supply 50% of our energy requirements in 2050. That would be a 2,500% increase from today’s level, offering investors strong return potential.
Efficiencies are coming from government policy and technical breakthroughs. Several countries and states are banishing the incandescent bulb for the more efficient compact florescent (CFL). Looking forward, the light-emitting diode (LED) is the next generation of energy efficient lighting, using just a fraction of today’s wattage-wasting bulbs. Gas-electric hybrid cars get 2-3 times the mileage of our current Corporate Average Fuel Economy (CAFE) standard fleets, with the promise of plug-in hybrids getting over 100 miles per gallon. Breakthroughs will double solar cell efficiency and windmills have grown to megawatt-size turbines. Each of these new technologies is a huge business opportunity, creating new jobs while improving both efficiency and performance.
The first warnings about carbon dioxide emissions came 50 years ago. Like cigarettes, the consequences seemed so far in the future that doing nothing was easier than making any real change. Now, the leading scientists from the Intergovernmental Panel on Climate Change (IPCC) have projected a warmer world, rising sea levels, stronger storms, species extinction and spreading topical diseases. Minimizing these effects would clearly benefit all humanity.
Most everyone has now seen the Earth at Night visual from NASA -- a beautiful nighttime mosaic of our planet from space. Presently, two-thirds of all those lights come from fossil fuel power generation. Coal and natural gas remain the fuels of choice for generating electricity, while petroleum is used predominately for cars, trucks, trains and planes. We are truly addicted to fossil fuels to run our modern society.
If we continue building and funding the world’s energy needs as we did in the last century, we deserve the consequences. If we embrace the "energy revolution" (Secretary of State Condoleezza Rice, September 24, 2007), investments in clean energy solutions will flourish and dominate the 21st Century. Climate change will be solved by shifting investments from fossil fuels to renewables, clean tech and energy efficiency. To track our progress, follow the money.
Peter Meisen (info(at)geni.org) is President of the Global Energy Network Institute. GENI (www.geni.org) focuses on the interconnection of electric grids between nations, with an emphasis on tapping abundant local and remote renewable energy resources. GENI partnered with KLD Research and Analytics (www.kld.com) to launch the KLD Global Climate 100 Index – an index of 100 global companies that demonstrate leadership in providing solutions to climate change through the themes of renewable energy, clean technology, efficiency and future fuels.
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