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Time for a global green growth strategy
Ladies and Gentlemen,
I just arrived back from Mexico City, where ministers joined in the final stretch towards the COP16 in Cancun.
Here, I also met Fernando. Together we are still fighting to live up to the slogan – CAN-CUN CAN.
And I would like to use this opportunity to thank Fernando and his colleagues for their excellent work in this difficult endeavour.
But are these international climate negotiations still important?
Isn’t all this climate and green stuff so much 2008 and for that matter 2009, when the world tried to agree upon a global climate deal in my home town Copenhagen?
In some of our countries – especially at times of financial crisis – there are indeed some who doubt whether it is still possible to go green.
Well, ladies and gentlemen – now there is help around the corner – I guess from the most unexpected corner you could image – the oil tycoon JR Ewing from the TV series
Dallas.
As it turns out JR Ewing, or maybe rather Mr. Hagman,
is now the happy owner of the largest solar array of any residence in the US, maybe the world.
“With all that oil gushing away in the gulf," Hagman recently told
The New York Times,
"I figured it was time to call for a new direction in where we're getting our energy”.
“Since Sarah Palin is saying, 'Drill, baby, drill,' I'm saying, 'Shine, baby, shine.'"
And well, Hagman’s investment in solar energy definitely makes sense. We can’t just continue with the present sources of energy. Or to move from a TV-icon to a icon of philosophy– Albert Einstein:
”The problems we have today, cannot be solved by thinking the way we thought when we created them”.
In other words: We need new thinking to combat climate change – and we need an energy policy that is even more based on efficiency, renewables and green tech.
And there are basically three reasons for this.
We have to change
The first explanation is linked to the world’s population.
Just imagine, in 2050 we’ll be 9 billion people on earth.
And with a growing global middle class, more people will demand cars, fridges, city breaks, ipads and all the other commodities of a modern life.
This will put increased pressure on practically every natural resource on the globe – including those that power our current “black” economy like oil, gas and coal.
Second; we can’t afford that the increasing demand for energy is speeding up climate change.
Because climate-induced crises could topple governments, feed terrorist movements and destabilize entire regions.
That is why the Pentagon for the first time in history has incorporated climate change in its defence review this year.
Third; the increasing energy consumption means rising and unstable prices – especially concerning oil, where it is uncertain if the production and the research in new drilling methods can keep up with consumption.
Hence, as president Obama has said recently, we have to begin
“to address all facets of our over-reliance on fossil fuels”.
If
we don’t act we will not only experience higher temperatures,
we will experience higher prices – to the detriment of our economy and our energy security.
Geen race
And here we are obviously highly dependent upon business - and not least science - to crack the green code.
But obviously, governments have a role as well – especially in terms of getting the framework conditions right.
The Danish case: Climate CommissionDenmark is here an excellent case study.
Back in the ‘70’ties, when the oil crisis struck us, a broad majority in parliament embarked upon a paradigm shift -
We chose to prioritise energy savings and renewable energy.
And we didn’t stop, when oil started to flow again in the 80-ties. No, we continued down the low-carbon route and also invested heavily in research and development.
And what is more: through out the years we have shown that investing in renewables goes hand in hand with economic growth.
As a matter of fact, since 1980, the Danish economy has grown by almost 80%, while our energy consumption has remained more or less constant, and co2-emissions have been reduced.
The share of oil in the total Danish energy consumption has fallen dramatically over the years. At the same time renewable energy is now covering almost 1/5 of our energy’s consumption.
Today, almost 12% of our exports come from clean tech – and it is now part of the Danish brand on the global scene.
But we should not rest on our (green) laurels. That’s why the Danish government in 2008 set up a national commission to help us to become completely independent of fossil fuels.
The Commission just presented its report last month and its core conclusion is that independence is not a pipedream;
It can be done – and exactly because the prices on fossil fuels are bound to go up, it can be done at only a very limited extra cost.
Indeed, you can say that the slightly higher bill for green energy is an insurance premium [fee] that we pay for not having to participate in the global energy race – and hence deposit our room for manoeuvre among a limited number of energy producing countries!
Our official goal is now to become independent of fossil fuels in 2050 – And we will present a roadmap to how this can be achieved after X-mas – providing long term predictability and incentives for transformation to green energy.
But Denmark is obviously not an “energy island”;
We are part of the European Union, so we’ll pursue our energy transformation together with the rest of Europe.
Just to give you two examples.
As the only country together with the UK, we just decided to support that the EU should raise its own reduction target from 20% to 30% CO2-emissions in 2020 – disregarding what happens in Cancun at the COP-16.
This will not only boost our clean tech industry;
it will also breath new life into our common trading scheme of CO2-credits, the so-called ETS-system.
But just as importantly, we are also strongly in favour of developing a common European energy infrastructure, the
so-called super-grid system.
To be very concrete such a system would enable us in Denmark to export our extra wind energy to Germany when its raining and their solar panels are not producing any energy.
Similarly we could, with serious investments, import solar energy from Spain, Portugal and Germany when our wind is not blowing.
As a result, the price on renewable energy would come down and we would be able to adapt large volumes of renewable energy into our grid.
No doubt, this will be expensive, but at the same time;
Status quo is not an option.
And I do believe this will speed up our transformation to become a society based on green energy,
And at the same time the intelligent design needed to build the super grid can reveal itself to be a new market opportunity for the clean tech industry.
COP16 But national and regional policies need a clear compass to make sure that we all know where we are heading.
We need to point out a clear direction in order to give investors an idea how to spend their money and time right. A global agreement on tackling climate change is ultimately the best way to provide investors with such direction and to anchor national policies around the same goals.
85 % of global financial flows are private. If we as politicians want a bulk of that money directed towards research, development and deployment in clean tech. We have to deliver a long-lasting, global framework for investment.
This brings me back to where I started:
The climate negotiations in the UN.
Over 100 leaders did not meet in Copenhagen last year just to drink coffee for 20 hours.
They met to deliver a global framework for the fight against climate change and for ensuring green growth – aiming at putting a price on carbon and agreeing upon mechanisms which can transfer technology from the developed to the developing world.
As you all know, it turned out NOT to be a hole-in-one.
But we did agree on substantial matters in the Copenhagen Accord.
I trust that Cancun will be another major leap forward,
building trust and confidence amongst ourselves that the world is on track – and that the future is green.
But let’s be frank we WILL make mistakes down the road.
This reminds me of Thomas Edison, who as we all know invented the light bulb. For years he and Henry Ford worked on creating an electric car.
And Ford believed it would be the most used vehicle in a near future. But Edison persuaded Ford to give up on the idea.
Maybe that’s why he years later said:
"Many of life's failures are people who did not realize how close they were to success when they gave up."
So, ladies and Gentlemen, We will make mistakes.
But they will make us wiser. And that will bring us forward in the green race.
Thank you!