It's been a while... How to Think About Your Carbon Footprint

Well, it's hard to believe it's been five years since my last post.  Time flies.  And that when it comes to the climate emergency and sustainability, that's not a great thing.  As Bill McKibben often says "winning slow is the same as losing."  

We've made some amazing progress in the last few years -- the cost of renewables has continued to plummet and clean energy's been a rapidly growing part of the energy mix; the investment community has largely woken up to climate risk and the importance of other sustainability factors, from justice, equity, diversity and inclusion (JEDI) to agriculture, to biodiversity and more.  But we're still so far from where we need to be. 

I've been focusing most of my efforts on our work at the Intentional Endowments Network (IEN) -- and it's been gratifying to see the progress.  We have over 200 members -- a mix of endowments and other asset owners, investment managers, consultants and outsourced CIO firms and amazing nonprofit partners.  And more endowments continue to take action, with a lot of focus and growing momentum on the concept of Net Zero Portfolios and addressing racial equity in the investment process. 

But given the original purpose and audience of this blog, I'm going to try to focus more on the things we can all do as individuals in this critical moment.  Despite lots of inaction and interference and misinformation from the fossil fuel industry and its allies, we've made some good progress over the past ~20 years. But we need to make a lot more over the next 8 years.  So let's stay going. 

I thought this short article from Bloomberg Green on "How to Think About Your Carbon Footprint" was a good one - showing where the origins of the concept came from -- the fossil fuel industry wanting to shift attention away from it's business model (a core concept behind the fossil fuel divestment movement that's often under appreciated) -- and also making the important point that while we all need to think systemically, our individual actions are indeed tied to that.  

I was particularly pleased to see this point articulated: 

Moreover, purchasing power sends a message to businesses that you support their investment in a climate-friendly world. There’s even public opinion polling to back this up. “For years, we’ve been asking, ‘Would you reward or punish companies for their actions?’” says Anthony Leiserowitz, director of the Yale Program on Climate Change Communication, whose team has identified a growing consumer base that is “rewarding and punishing companies for their action or inaction on climate change.” 

Because while every ton of carbon emissions avoided is important, sending these types of signals to the markets -- whether its the car companies, heat pump manufactures, solar companies, insulation installers, etc. -- if there's demand for it, companies will invest and grow that business, advertise and sell it to others who might not be self-motivated to take climate action, etc. 

So, keep on pushing to reduce your own carbon footprint -- but also vote, write your politicians, look at your investments, and send a note to your alma mater(s) to encourage them to put sustainability at the center of their investment strategies, (and to join IEN if they haven't already :) 

I'll aim to post some more quick, practical ways to take action... and hopefully before another five years goes by... 

Stay going. 

Write a Letter, Be Counted

Before the holidays, I wrote about an emerging campaign called The Million Letter March.  The concept is to get as many people as possible to write a personalized, hard-copy letter to their representatives, encouraging them to show some leadership on climate action, and work to recognize the true costs of emitting greenhouse gases by putting a price on carbon.

With the new Congress, much of the focus is still on ideological, political bickering.  A strong showing of personalized letters will show that there is support for climate action - and doing so through this project which tracks the letters, will help show the collective impact of many people understanding the importance of moving on this issue.

It will take about 5-10 minutes to write and print your letter, record it in their system and put a stamp on the envelope.  So please go to www.millionlettermarch.org and click "Write Your Letter" at the top of the column on the left.  They have some sample text if you're looking for inspiration - below is a copy of what I sent.  It's not necessary to make every point about why pricing carbon is important - national security, health, driving innovation, saving lives, protecting ecosystems, creating jobs, etc. etc. - but make one or two that are particularly important to you and send it off!!

Dear Senator,

Please do everything in your power to put a price on carbon.  Climate disruption from greenhouse gas emissions is already wreaking havoc on people in the US and around the world, and the longer we wait to take meaningful action, the worse it will get.  The economic impacts of this disruption will be enormous. More importantly, there is no way to put a price on the hundreds of millions of lives that are at stake, or on a species, or a place.  

We must do everything in our power to eliminate our greenhouse gas emissions as quickly as possible. I support the Million Letter March Principles, found at www.MillionLetterMarch.org, and would welcome a carbon tax.  We need to adopt a science-based target of 350 parts per million atmospheric concentrations of CO2, and take the most sensible and effective measures of getting there. 

Putting a price on carbon immediately is a necessary first step.  Luckily, it is also one that will drive innovation, produce entire new industries, and create millions of jobs. 

Please support a price on carbon through fair, effective climate legislation. Thank you, and I look forward to your response. 

Sincerely, 

Georges Dyer

Stay going.

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Prop 23 & Green Jobs

A friend sent me a recent Opinion piece from the Wall St. Journal titled "Prop 23 and the Green Jobs Myth" by T.J. Rodgers - founder and CEO of Cypress Semiconductor, which acquired SunPower Corp - one of our country's largest solar companies - in 2003.

Image source: Solar Richmond, www.solarrichmond.net

In the piece, Rodgers supports the fossil-fuel industry-backed Prop 23 by essentially trying to tie it to California's economic troubles, and claiming it will hurt job growth.  I can appreciate the position that putting a direct price on pollution can look like an added cost, but I hold that it's correcting a market distortion - we are and will continue to pay the costs of extracting and burning fossil fuels whether we do so directly (by pricing carbon) or indirectly (through healthcare, destruction of personal property & infrastructure, loss of life, undermining ecosystem services, etc.).  

Image source: The 6th Extinction

Attempts to tie a direct line from AB 32 (California's climate change legislation) to the state's current economic woes are disingenuous. First, the law hasn't gone into effect yet.  Second, the initial targets of AB 32 are so easy to meet, that the costs will be more than offset by cost savings from efficiency upgrades and better processes.  I know Econ 101 tells us that business would already have realized all of those cost-savings if the potential was there, but businesses are run by people, and as we know people aren't always perfect - the vast majority of businesses have huge unrealized opportunities for cost-savings with little or no upfront investment.

For example, EDF's Climate Corps program hires MBA students to help big companies identify efficiency opportunities - this year 50 interns generated $350 million in savings for these companies. Starting to send the price signal to the correct source - which AB 32 will do, and which Prop 23 is trying to stop - will accelerate these efforts and further innovations to make our economy more efficient, more effective, and more competitive. 

At Cisco Systems, fellow Emily Reyna developed a plan
for installing energy-saving devices in R&D labs that
could save an estimated $8 million per year (with an
18-month payback) and reduce Cisco’s greenhouse
gas emissions by 3%. Source: EDF

I also disagree with the suggestion that the green jobs that AB 32 (and other policies like it) will promote, are a false promise.  I do think most reports on both sides of this topic require a lot of assumptions and aren't perfect.  Still, here's one that finds that policies that incentivize more efficient energy use -- it looks at the case of California, where energy efficiency policies from 1977-2007 created 1.5 million jobs while eliminating fewer than 25,000: http://www.nytimes.com/2008/10/20/business/20green.html.  An overview of some other studies that show the expected job growth impacts of AB 32 is available in this Climate Progress post. 

In his piece, Rodgers talks about how SunPower moved manufacturing offshore because of the "high cost and red tape" of manufacturing in the US.  This opens up another whole conversation, but I think this rationale eludes the basic point -- labor's inexpensive in places like the Philippines and Malaysia (where their plants are) because wages and the general standard of living is very low.  That's obviously not what we want for California and Californian workers. More to the point, the piece only talks about the jobs manufacturing solar panels -- the real appeal of green jobs is that most of them can't be outsourced - the jobs installing and maintaining the solar panels (as well as financing the solar panels, weatherizing houses, lighting retrofits, installing green roofs, farming local foods, etc. etc.) 

SunPower's Malaysian fab plant.
Image source: EngineerLive

The piece also claims European subsidies that have helped support the market for renewable energy there have had a net-negative impact on jobs. Here is a White Paper from the National Renewable Energy Lab refuting the study cited to support this claim.  Much of the growth in the solar market (and presumably SunPower's revenue) over the past 5 years can be attributed to these policy structures of the major solar markets in Germany and Spain.  In 2003, when Cypress acquired SunPower it was losing money - outsourcing jobs likely had some impact in turning that around, but I'd wager a much stronger driver was the solar market exploding over that time -- due in no small part to these policies and Europe's cap & trade system, as well as the awareness building that hundreds of groups have done on the true costs and impacts of fossil fuels.

Of course, it's surprising to read a piece supporting Prop 23 authored by the Chair of solar company, as it's so clearly bad for the company's growth.  It reminds me of Tony Hayward who said when he took over BP: "We had too many people trying to save the world" (http://www.huffingtonpost.com/kevin-grandia/bp-ceo-hayward-we-had-too_b_585610.html) -- he promptly went to work trying to turn that around, getting super-efficient in a traditional, linear sense, and cutting corners to disastrous effect. 

Here are a few of yesterday's headlines from Point Carbon, that covers the full-fledged carbon market that has been in effect in Europe for 5 years.  The second one makes a very flexible system even more flexible -- the companies impacted by this will likely make a lot more money than they currently are as a result.  The third one removes any legitimacy of trying to tag cap and trade as a "tax".  

• Market praises California's cap-and-trade design Published: 29 Oct 2010 California's cap-and-trade system will spur investment in clean energy, market sources said.
• California boosts offset limit in cap-and-trade system Published: 29 Oct 2010California emitters can use offsets to meet 8 per cent of their compliance obligation.
• California to give away majority of allowances Published: 29 Oct 2010California will hand out most of its allowances at the start of its cap-and-trade programme.

Here's another good take on Proposition 23 from Thomas Friedman: http://www.nytimes.com/2010/10/06/opinion/06friedman.html?_r=2&ref=opinion

I respect Mr. Rodger's leadership of SunPower Corp, and hope he will come around and see how policies like AB 32 (or anything that puts a price on carbon) will help his company, and create jobs and improve efficiency and competitiveness.

Finally, the piece states: "While our state government frets over issues like... the habitat of the red-legged frog, our economy—the habitat of homo sapiens—is a disaster."  This brings up the most essential point. We need to really internalize the reality that the economy is a wholly-owned subsidiary of the biosphere.  The red-legged frog's habitat and our habitat are one and the same.  Without policies like AB 32 we will degrade that habitat to the point where it won't be able to support our civilization - and at that point it won't matter how many jobs we were or weren't able to create in the short-term.  Luckily, these policies will create jobs and create a whole new economy that is sustainable for the long term.

Californians, please vote "no" on Prop 23 on Tuesday.

Stay going. 

The Glorious Mess

In this recent piece for Yale e360, Eric Pooley, deputy editor of Bloomberg BusinessWeek and author of The Climate War gives a great analysis of the current status of a national climate bill this year (near dead).

While the disastrous downsides of this failure to act are many, this quote sums up pretty well what we're looking at for next steps, and why it is about as far from a strategic and effective approach as we can get:

Welcome to the “glorious mess” — Michigan Rep. John Dingell’s phrase for the tangle of regulation and litigation that will follow when Congress fails to act. We are about to experience precisely the sort of costly, protracted, plant-by-plant trench warfare the cap was intended to avoid. Since the utilities and the manufacturers weren’t willing to cut a deal, this is what they get. The fragile period of compromise and cooperation between environmentalists and big business may now be coming to an end. Green groups that have invested time and money into the legislative process are now putting on their war paint and returning to the courts, with a renewed focus on stopping new coal-fired power plants and shutting down the oldest and dirtiest ones.

I remain hopeful that good sense will prevail, that we will be able to remove poisonous partisan politics from this issue and realize that this is one we're all in together, and we're way overdue in responding to.  My optimism also leads me to believe (or at least hope) that maybe the glorious mess won't be quite as messy as suggested above - the Regional Greenhouse Gas Initiative (RGGI), the Midwestern Greenhouse Gas Reduction Accord, and the Western Climate Initiative (WCI) are getting more and more established, and looking into linking.  These states and provinces account for nearly 40% of US GHG emissions, and are taking important steps in internalizing more of the true costs of carbon emissions and driving the investments in better design, efficiency upgrades, and product innovation that will not only reduce emissions but also spark economic activity and create jobs.

State and regional precedent is important for federal policy, and now I expect NGOs, businesses, and local and state government to refocus energy on effective programs that will set that precedent while reducing emissions and creating jobs at the same time.

Sector-wide approaches continue to lay the ground work.  Hundreds of colleges and universities are demonstrating real leadership, educating students, driving research, eliminating their own emissions, and engaging with communities to create solutions.  Through the ACUPCC hundreds have publicly reported comprehensive climate action plans on how they will do this.  ICLEI continues to help municipalities ramp up progress, and the C40 Cities initiative has the world's most influential cities stepping up and trying to out-do each other in the most productive ways possible.

It's painful to dwell on the missed opportunity the Senate's inaction represents, but it's possible it will open up more unexpected opportunities that will enable us to avoid the worst impacts of climate disruption.

Stay going.

Carbon Finance Links

Point Carbon

CO2e

Carbon Market Solutions

Carbon Tax Center

Federal Carbon Tax

TaxShift.ca

World Bank Carbon Finance Unit