CLIMATE CHANGE – MIGHT WE ACTUALLY BE WINNING?

  • by Jim Wood, CEO, Green Mondays
  • May 01, 2013
  • 0 comments

Someone in the film industry told me recently that the easiest finance at the moment is for post-apocalyptic films, which suggests we’ll see significant growth in a genre that began with Mad Max and continued into Cormac McCarthy’s The Road. It seems that the film industry is subconsciously preparing us for a bleak future.

 

And that’s perhaps not surprising, with the media running headlines of atmospheric carbon passing 400ppm, and the EU ETS on a life support machine. With the exception of a few rays of sunshine in China, the international climate policy framework appears increasingly beyond us.

 

But this thinking misses a very important point. Namely, that pioneers in the business community are already equating carbon innovation with the profit motive, the great motivator of the business machine. And as this thinking spreads, it will reward companies that put climate change into the fabric of their decision-making and threaten organisations that see carbon as a compliance issue.

 

At Green Mondays we sense the time is right to look at climate change in a different way. One that sees politicians as an aid rather than a solution, and embraces the ingenuity of business as the agent of change. And we’re delighted to have three great examples of this ingenuity on our stage in June – the legendary Amory Lovins, Nissan’s Andy Palmer and Opower’s Nandini Basuthakur.

 

Here’s a little on why each of them represents a vision of a better future that is reassuringly driven by self interest. And we know self-interest works.

 

Amory Lovins & his 40-year energy plan

 

Amory is a physicist who has briefed 20 heads of state on energy and resource efficiency, published 29 books and was named in the 100 most influential people in the world by Time Magazine in 2009. He is currently travelling the world with his 40-year plan for the future of energy, entitled “Reinventing Fire, Prosperity & Security without Oil and Nuclear”. His TED talk has now been watched by 650,000 people.

 

Amory sees the US becoming fossil-fuel free by 2050, driven by the pursuit of profit and without major developments in the policy landscape. He has an optimistic, pro-growth vision that involves the US economy growing 158% whilst reducing CO2 emissions fall by 84%. At the heart of his message is that in order to solve the energy problem you need to enlarge it, which he will explain on the 10th June.

 

To Amory, this is a once in a civilisation business opportunity, where companies hampered by old thinking won't be the problem because they won't be around in the long term. And to show that this thinking goes beyond theory, Amory will be joined by guests from two businesses that are embracing this opportunity.

 

Nissan’s Andy Palmer

When Nissan announced its $4bn electrical vehicle (EV) programme in 2009, the Economist magazine described it as “somewhere between very risky and certifiably mad”, and the leading US auto journalist called the Nissan Leaf “the most daring gamble in the automobile world”. The other auto makers could not understand the rationale behind Nissan’s commitment to EV’s.

 

But as we discuss in our case study, Nissan’s executive team believed that the need to reduce global emissions and rising gasoline prices would create demand for EV’s. For them, the risk of not doing it was greater than the risk of doing it.

 

Since launching the Nissan Leaf in 2010, Nissan has sold 62,000 Leaf’s worldwide, and the Nissan brand has become associated with radical innovation, something that has been lacking in its past. The last couple of months have seen a significant uptick in sales, with the Leaf being the second top selling car in Norway in April and US sales up over 400% year on year in the same month.

 

Since Nissan’s announcement all of the major auto makers have announced their own EV programmes, a shift that can be traced back to Nissan’s decision. It’s a great example of how one company can change an industry, and we look forward to hearing Andy Palmer describe the revolution from inside Nissan.

 

Opower’s Nandini

Opower is one of the darlings of the dot com world, but was set up by a group of entrepreneurs who wanted to combat climate change. They identified home energy consumption as a major opportunity to reduce carbon, but they did not believe mainstream change would come about from consumer’s desire to reduce carbon or save relatively small amounts of money.

 

Opower’s model is based on what some call behaviour economics, or gamification. It embraces the notion that humans are driven by peer comparison, and by providing energy consumption data alongside comparative figures from peer groups, it motivates people to want to improve their comparative performance.

 

Set up in 2007 in the US, Opower has formed partnerships with over 85 utilities globally, where it gets paid by the utility to provide the data to its customers. With a global reach into more than 15m homes, it expect to generate energy savings of 2 terawatt hours in 2013, enough to power a city of more than 1/2m people. Having raised $65m in seed capital, Opower was in Forbes top 20 most promising US companies in 2011.

 

Nandini is the MD for Europe and the Middle East operations of Opower, and will share her insights on behavioural science and the role it can play in corporate strategies.

 

The future

It is hard to be convinced that this thinking will diffuse through the economy at a speed that will allow us to mitigate significant climate change. But one can be a lot more confident that business will learn how to manage carbon emissions whilst at the same time it will invest in dramatically reducing intensity with which is uses key resources such as water. And this opens the door to an optimistic vision of the future, one where 9bn people can live better lives than they do today, and it will be thanks to the ingenuity shown by people like Amory, Nandini and Andy.

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