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After Copenhagen

Copenhagen was supposed to be the last chance for humanity on an assumption that emissions in the future would continue to grow as they have in the past. But what if the future is one of contraction and disorganisation anyway?

In the lead up to Copenhagen it was repeatedly said that this was “the last chance to save the climate”. This idea was constructed on an assumption about “business as usual”. If emissions continue to grow on current trends then, with little time left to put on the brakes and decarbonise the global economy at a sufficient rate, the task appears to be totally unfeasible.

With many scientists credibly arguing that we are already over the safe limit for greenhouse gas concentrations in the atmosphere this may be true. There is now a good case that we need to go beyond decarbonising in the economy to actually finding technologies and processes to take CO2 that is already in the atmosphere out again.

So is the situation now quite hopeless? Perhaps so... but perhaps not. A reason for being at least a little bit hopeful is the questionable assumption of what “business as usual” will be like. The common assumption is that the global economy will continue to grow as it has done over the last few decades. But is this assumption true in the light of peak oil and peak gas?

In the last year global emissions did not grow. As the economy slid into a recession emissions fell with them. One way of constructing the events of the last year are that rising energy prices played a major role in undermining many peoples ability to service their debts. A reckless financial system was undermined. Of course there was more to the financial crisis and the recession than merely a rise in energy and food prices but that was surely an important part of the crisis.

peak oil

This problem has not gone away. A few weeks ago the Guardian ran a story about a whistleblower in the International Energy Agency. This person had spilled the beans that the IEA is far more concerned that there will be a near term peak in global oil supplies than it has publicly acknowledged. Apparently the IEA’s spin is so as not to spook the financial markets or to undermine the power of the United States, which is very vulnerable to foreign oil supplies.

The conclusion that we can draw from this is that coming down the tracks there is an energy crunch and/or that, as the global real economy picks up, energy prices will continue rising. Rising oil prices will be good news to companies building follies in the Persian Gulf and in Moscow, but it will be bad news for continued growth in the global economy. It means that business as usual emissions will not be quite the same as projected in some of the IPCC studies.

There is no denying, of course, that the future is unclear. If oil and gas become much more expensive, and suppliers of them become insecure, the temptation to use more coal is enhanced. Coal power and coal to liquid technologies are both extremely CO2 intensive. Without carbon mitigation, for example a successful program of carbon capture and storage, oil and gas depletion could make the climate crisis even worse. As is widely acknowledged, the future potential of carbon capture and storage is unknown. It will certainly be a long time until it is extensively applied.

On the other hand, the rise in energy prices might undermine the economy and therefore investment in coal power. The Kingsnorth power station was doubtless put on hold because of successful campaigning but it was put on hold because of the recession too.

To return to the main point - the narrative about Copenhagen has been about the last ditch chance to prevent a growing economy bringing a climate catastrophe along with it. But what if the future is not one of continued expansion but one of contraction and disorganisation? We have had a recovery in the financial markets over the last year because states have been prepared to underwrite the losses of the financial sector. And the financial sector has gone back to its old speculative ways with very little in the way of regulation or control being imposed. In the background there is good reason to believe that the energy crisis has only just begun. Unlike the climate crisis which happens with a considerable time delay, the oil and gas depletion crisis will happen in real time.

There is another reason too to consider that the future will not simply be a projection of the past. One of the most perceptive studies of the response of governance systems to “stress urges” is that of the historian and archaeologist Joseph Tainter. In his study The Collapse of Complex Societies he argues that it is not war, crop failure, disease or economic crisis that in and of themselves create conditions for the collapse of societies, it is the inability of the governing, management, and technical arrangements of the society to cope with these stress surges. This inability to cope arises because they have simply become too complex. Any and every society tries to respond to its problems with increasing complexity but the returns to that complexity decline over time.

Is there reason to believe that our society is already too complex in Tainter's sense? I believe that there is and, what is more, the withdrawal of energy from the complex arrangements of modern society due to passing the oil peak will make the situation even worse. The future is likely to be one of considerable disorganisation.

What is the evidence for this view? Let us take some examples. In the middle of October a report appeared on the Bloomberg news service with a headline that read: “Nations leave 91% of Green Stimulus Funds Unspent”. It began as follows:

The US, China and major economies around the world are still holding about 91% of the $177 billion in stimulus money promised for clean energy development because most projects have not been evaluated, a report showed. Administrative hurdles remain to the majority of developers, with just 9% of the total funds having been disbursed from economic stimulus programs. “The process of disbursement has been a sobering experience,” said Anna Czajkowska, an analyst and author of the study.

One has to ask therefore, whether governments are actually capable of delivering "Green New Deals". Many people assume that if money is allocated to something then that is all that needs to be done. Of course this is not true. Expenditure has to be administered according to clear criteria. In new and innovative fields where the expertise and capacity does not exist that is no small thing. Some things are murderously complicated to administer, especially in fields where the bureaucrats have no experience or expertise.

In general climate policy is proving extraordinarily complex in its delivery. This is partly because fossil fuel use is, directly and indirectly, a feature of virtually every aspect of our society. The number of stakeholders is enormous. Thus, when we take, for example, the European Union's emissions trading system, the political accommodation of a mass of vested interests, has led to an extraordinarily complicated arrangement. There are multiple loopholes and get out clauses.

In the United States we see a similar problem in the cap and trade system going before the US Congress. So far the bill is 1,428 pages long (and growing). This complexity is partly the result of “regulatory capture” whereby multiple corporate lobbies have an influential hand in crafting policies to suit themselves.

There is a similar problem with climate policies related to land use and deforestation. The conditions on the ground are nowhere the same as anywhere else. But one cannot have a policy adapted to each location.

If the policies at national or European level are convoluted, then how much more complex would agreeing a global arrangement be? "This is the most complicated deal the world has ever tried to put together," says Tom Burke, an adviser on climate change to the Foreign Office. "In effect, you're asking nearly 200 countries to align their energy policies - to create a common world energy policy.” It is hardly surprising that the UNFCC process has been so chaotic.

Then of course if governments do agree specific climate mitigation commitments, they must be able to deliver on those commitments. This is not straightforward. On the surface it seems that the simple way to go about this is to promote a few large-scale engineering projects. Carbon capture and storage has already been mentioned. The other example is nuclear power. Unfortunately, the same problem of declining returns to increased complexity applies in the field of large-scale engineering.

At the time of writing there has been a decision to build 10 nuclear power stations in Britain similar to the one being built in Olkiluoto in Finland. So lets take that as a case study. According to a recent article in the news magazine Der Spiegel there are 4,300 workers from 60 countries working with 700 subcontractors building this “third generation” nuclear power station. The complexity of globalisation is mixed in with the complexity of advanced technology and nuclear power. So what is the result? It is 2,300 million Euros over budget; the scheduled finishing date is now 2012 although it was supposed to be the spring of 2009; there have been 3,000 faults in construction so far. Perhaps worst of all, there is no satisfactory design for the control system of the reactor, so that the developers are in conflict with the Finnish nuclear safety authority.

Worldwide there are 52 nuclear reactors under construction. 13 of these have been under construction for 20 years. 24 have no scheduled completion date. At least part of the problem is that in many countries the staff of nuclear power stations are now coming up for a retirement and there are few new nuclear engineers to replace them. In Britain and in the USA about 40% of the nuclear workforce will retire in the next 10 years. With few to replace them the idea that a massive nuclear program can be developed rapidly and safely is highly questionable.

We are being asked to believe that governments can manage a process from here to 2050 and beyond involving a mass of tough and complex political and economic decisions. To be able to deliver on their commitments they will need enough trained and motivated people; enough political attention and intention; an ability to handle the financial risks over decades; and institutional capacity to develop, disseminate, and service new technologies; sufficient managerial ability; the capacity of the media and political leaders to remain focused on crucial problems; a consensus among voters about important priorities; a sufficient ability to look far ahead to anticipate problems; long runs secure energy and material supplies reserve for investment purposes instead of consumption; an ability to evolve the legal framework; coordination and cooperation with other governments. (Here I draw on Meadows D, Meadows D and Randers J, Limits to Growth. The 30 Year Update, Earthscan 2005, p223.)

In all seriousness one must ask whether this is a realistic prospect. As the world becomes more complex it becomes necessarily more opaque. The more interrelated elements that there are in any given situation the harder it is to trace back the causative influences determining events. At the same time it becomes less easy to predict what the knock-on consequences of an event or an action will be. The creation of unintended side consequences becomes inevitable. The management and steering of complex systems becomes virtually impossible. What really happens is a constant process of knee-jerk responses, a constant process of review and studies from consultants and a public relations facade to hide the underlying chaos.

In large and complex systems, top-down management tends to break down. In the Copenhagen negotiations China was criticised for refusing to be open to external verification of its greenhouse gas emissions. I would speculate that at least one of the reasons is that the Chinese negotiators realised they already have great difficulty in exercising any central control over local and regional administrations and businesses. At the back of their minds they are probably aware they could not accommodate external verification even if they wanted to - at least not without it leading to a great deal of aggravation from largely autonomous local party bosses and their business allies.

For politicians in general the future will certainly be full of distractions dragging them away from the necessary focus on climate priorities. The aforementioned process of complexification is making the banking and financial system extremely difficult to manage. There will be plenty to do “managing” this problem. Clever mathematicians devised financial instruments of such sophistication that no one could value them so the banks lost trust in each other when energy prices took the top off the speculative frenzy. The complexity of the banking system in an internationally networked digital world makes regulation extremely difficult. Yet the finance system is a hub network. If it breaks down, chaos cascades in all directions.

We may yet find that financial chaos breaks out again and has profound effects not only on general economic activity but also on the technological “progress” that we have come to take for granted. Consider how that might come about. After the Lehman Brothers collapse, banks would not issue the letters of credit required for international trade as they did not trust counter-party banks. One reason for the 90% drop in the Baltic Dry Shipping Index was the temporary freezing of such financing.

Thus a re-emergence of financial panic, in the context of financial institutions taking in the deeper meaning of peak oil, is likely to have considerable disruptive effects in world trade. Yet the smooth running of world trade is necessary to the maintenance of the technical infrastructure on which society has come to depend. Just to take one example – a mobile phone requires 22 basic elements in its production. These have to be a sourced quite literally from every continent on the planet. Much energy is expended in long journeys involving mining, transport, trade, manufacturing and retailing operations before and assembled product is available for use. Similar complexity applies to other computer, digital and electronic systems. A prolonged energy shock, creating a financial shock, morphing into a trade shock, would when prolonged eventually lead to a failure to replace phones, computers and so on. After a time the components would start to degrade and, with them, the systems in which they operate. This would of course be slowed down by a long process of scavenging components and recycling their use where this is possible.

Mobile phone partsThe ingredients of a mobile phone (thanks to secret-life.org)

One therefore has to ask whether governments, individually and collectively, are losing their power to steer the course of events. Complex multi-dimensional policies are losing their effectiveness. In circumstances of this sort, whatever policies governments adopt must be made simple and overarching and then it must be left to engaged and informed citizens to do the rest. For this citizens must act on their own initiative and will need to support initiatives that go above and beyond the household level.

In the meantime governments will struggle to find simple effective policy instruments and ways of maintaining social cohesion in the face of growing unrest. As governments and large corporations are increasingly seen to fail in the context of energy descent millions of people will be forced into supplementary “self-help” solutions – growing some of their own food, and adapting their lifestyles to power cuts. Governments will need to go with this flow and, ideally, support engaged citizens or they will find themselves working against them.

There are no magic bullets for this situation. The assumption of governments is that there are large scale solutions for large scale problems but this is not so. The problems have to be solved one house, one street, one neighbourhood, one farm, one forest, one region at a time. This will require the active engagement of millions of people as eco-citizens. Well-informed and appropriately skilled citizens will need to act together to develop, protect and maintain their own health and that of their communities. This will be mainly a movement of projects rather than a movement of protest – because a movement of protest will be largely futile. There is a danger that our betters will be seen to have lost the plot. Governments will have mega-deficits and will be forced to choose what to spend money on. Will they put this money into banks, or into largely futile big engineering projects or will they support ordinary people’s efforts to bring back some control into their lives by eco-renovating their homes and neighbourhoods?

Despite everything there are relatively simple policy options that could be implemented when the logjam created by corporate vested interests eases. At a certain stage it may be that an active citizens’ movement will have a lot more clout and governments will be able to base themselves on these movements and act more strongly against carbon corporate interests.

The simplest policy would be to set a rapidly reducing limit on the amount of carbon allowed into the economy by a permit scheme imposed upon the very small number of fossil fuel suppliers. To maintain social cohesion the revenue raised when fossil fuel suppliers have to buy permits to sell would go to the population per capita (‘Cap and Share’). This would channel the carbon revenues to the base of the economy, where it is most usefully applied, helping to fund the process of making houses, gardens and neighbourhoods more eco-efficient.

Ideally governments would support and encourage community-led self-help adapting to energy descent and carbon reduction as well as developing lay expertise. It would channel resources and support to communities and households rather than to mega schemes that are likely to fail.

To conclude, the current discourse about the aftermath of Copenhagen assumes a future that is merely a projection of the past. Nothing could be further from the truth. Humanity has now reached the limits to economic growth. Climate change is just one manifestation of this. Having overshot and overused natural capital humanity stands before turbulent times. The complex governance and management arrangements underpinned by plenty of cheap energy will not be up to dealing with the problems we face. A totally different politics and totally different lifestyles are necessary if humanity is to have any chance of seeing out the century. At the same time the future may yet prove more malleable than we think. Whether this is really a cause for hope after Copenhagen remains to be seen. But let us at least discuss the real issues rather than the banalities of the official narrative.

About the author

Brian Davey is a freelance ecological economist who lives in Nottingham and  works closely with Feasta, the Dublin-based think tank for Sustainable  Economics, on climate and energy issues. He is also co-ordinator of the cap and share campaign.


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