Prospects for climate change: is your glass half-empty, or a half-full?

Two glasses, both half-full of green liquid.

Grantham lecturer Dr Mirabelle Muûls asks herself whether optimism about solving climate change is well-placed.

Should we be optimistic or pessimistic about our collective ability to tackle climate change? Listening to the inspiring academic and corporate speakers at our “Mobilising Business, Acting on Climate” conference last week, I heard the debate between optimism and pessimism played out in many conversations.

The conference, which we organised with Imperial College Business School, brought together leaders from organisations ranging from the Organisation for Economic Cooperation and Development (OECD) and Generation Investment Management, Al Gore’s sustainable investment outfit.

Fighting against the tide

At the event, Professor David Miles (Imperial College Business School), gave us two main reasons for feeling pessimistic about our ability to move rapidly towards a low carbon future. His first was that oil prices are low, offering little incentive for consumers to reduce their use of oil, nor to invest in and innovate new ways of living with less oil.

Even when all the numbers add up, energy consumers rarely change their behaviour. Norman Crowley, from Crowley Carbon, described how he approaches potential clients with ways to improve energy efficiency on their sites. Despite the fact he offers to provide the financing and ensures return on investment, leaving little economic case for saying no, his take-up rate is only 10%.

This type of consumer inertia will compound the worry of some people that that the oil and gas industry is reluctant to embrace change.

Citing the example of nuclear power – a technology that has an incredibly strong safety record, but a poor level of perceived safety – Professor Miles explained that his second reason for pessimism relates to people’s inherently poor ability to assess risk. By extension, since we have no experience of a world that has warmed by 2+°C since pre-industrial times, we are unlikely to want to make strong and rapid changes to our behaviour.

Mike Barry, Director of Sustainable Business at Marks and Spencer, hypothesised that a megastorm, or similarly large-scale disaster, would be needed to make the majority of people change their willingness to act.

Looking on the bright side

Facing such a wall of pessimism can seem daunting, but the optimists’ arguments also came out strongly at the event.

Professor Miles explained that public risk perceptions can change very quickly, noting the significant inter-generational attitudes to drink-driving or smoking that we see today. In addition, short term co-benefits could incentivise key countries to act sooner, people in China, for example would benefit significantly from air quality improvements as a result of reducing emissions.

His third optimistic note – reflected by several speakers at the event – related to technological advances. We have already seen significant advances in low-carbon technology, including exponentially falling costs. Take the example of solar power. Or the millions of tons of carbon emissions that Crowley Carbon can cut in the industrial sector. Or the success of M&S’s plan A. Or the leadership that Elon Musk and others show in creating low-carbon products that are cool and attractive ‘must-have’s , like Tesla’s electric vehicles.

Such optimism was justified by the views of those who represented the investment cash at the event.  Both David Blood, co-founder of Generation Investment Management, and Kelsey Lynn Skinner, a venture capitalist at Imperial Innovations, emphasised that sustainable investment can, and must, achieve both growth and high returns, moving us closer to a carbon neutral world.

Sitting on the fence

Research that targets low-carbon solutions can result in unexpected benefits for other areas too – the so-called ‘spill-over’ effect. Interestingly, my colleague Dr Ralf Martin has shown that spill-overs from clean technologies are greater than those of similar fossil fuel innovations. Hopefully this is another indicator that markets will start to favour low-carbon opportunities for more conventional, economic reasons.

Bjorn Otto Svederup, Senior Vice President of Sustainability at Statoil spoke of managing a transition to a low-carbon economy in a responsible, and economically sound manner, recognising that oil and gas assets need to be managed carefully.

Surrounded by the dynamism of the audience, I weighed both sides of the scale, and was relieved to lean towards my natural tendency: optimism. Innovation and R&D can achieve the unthinkable, and spark true revolutions in every aspect of our lives. I left the day in a very optimistic mood, with a smile on my face, and kept in mind one a quote by one of the speakers from Ghandi: “Be the change you want to see in the world”.

Dr Mirabelle Muuls is Grantham lecturer in the economics of climate change, and convenor of the Mobilising Business, Acting on Climate conference organised jointly by the Grantham Institute and Imperial College Business School, which took place on 21 April 2016.

 Further links

Optimism and strong leadership are needed to tackle climate change, say experts

Climate Q&A: How can universities help businesses go further?

Happy staff and customers are key to sustainable business, says M&S director

 

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