Remember all those other stock market collapses, property busts and recessions over the past 30 years, not to mention the huge scams that got pulled on us and ensuing billion dollar bailouts? And now we’re into the Mother of all financial meltdowns since the Great Depression, with the Grandfather of trillion dollar bailouts. All because, until a few short months ago, we bought into the notion that, though we may not understand it, the bankers and the financial wizards did, they knew what they were doing and had created an unsinkable fountain of wealth that would eventually trickle down to us all. Well, now we know they didn’t. Hadn’t a clue in fact, to hear some of them tell it.
It’s good we’ve learned our lesson. We’ll never get carried away like that again, will we? Except of course we might. If you thought the last nine months was bad, don your life belts because the carbon market, a potential Titanic of all boondoggles, has set sail.. and of course we all understand how that works, don’t we?
Last month the US Congress narrowly passed the American Clean Energy & Security Act. In the next few months some form of emissions-control bill will be enacted before the forthcoming UN climate change conference in Copenhagen this December. The new legislation will likely be some form of market-based mechanism called “cap and trade” to regulate and reduce emissions. That’s good news, at least the Americans are finally taking climate change seriously. Which means some people somewhere, have worked out how to make boatloads of money and don’t want the Europeans and Chinese to run away with the game.
Under cap and trade, governments issue a fixed number of Co2 credits, which give the bearer the right to release a ton of Co2 into the atmosphere a year. In time the number of credits will shrink, reducing emissions to a degree scientists hope will keep the planet from turning into a Turkish bath. The system is based on a similar plan used successfully back in the ‘80s to reduce the amount of sulphur dioxide, which caused acid rain. Carbon trading is a complex business, not least because of Co2 offsets. Offsets are get-out-of-jail-free cards allowing the bearer to pollute beyond what’s allowed. It works like this: agriculture, say, takes Co2 out of the atmosphere by converting Co2 back into oxygen, it get offsets for doing so. Agriculturalists are then free to sell those offsets to power plants and other emissions-spewing companies.
Sounds good in theory. Could be good in practice. What are the snags? An awful lot, I fear. First off, markets can be rigged and you can bet that quite a few rogue industries, the power companies say, and a slew of those financial maestros who got us into the current derivative-driven mess, are already working on it. So that leaves government oversight and regulation to keep it all squeaky clean. Or perhaps we can rely of the Carbon Trading Market to police itself? Recent history does not inspire. How, for instance, are these credits to be priced and valued? The fairest way would be for them to be auctioned off and let the market find its level. But that’s not what’s happening. It’s not going to happen in the US and it didn’t happen in Europe, where a Co2 market is already in existence. Guess what? They gave them away. And who to…? The energy and power companies, that’s who. In any market, what goes up… can and does come down (anyone’ll tell you that while taking your money). The current economic bust hasn’t helped carbon traders much. Initially Co2 traded at Euros 30 p/ton, now it’s down to Euros 10. Of one thing you may be sure, up or down, someone someplace is making money on it.
Willy nilly, we are all embarked on a colossal undertaking few of us understand... and which we hope is good for the planet. If nothing else, we must scream and holler blue murder, insisting our governments ensure open dealing and provide the strongest possible regulatory oversight, not to mention draconian punishment for transgressors, somewhere just short of public disembowelling. Anything less than that, and we all know exactly how it will be…
The Month in Gaia
It’s the Rich wot get the Pleasure....
Rich people and their lifestyles account for a major chunk of global carbon emissions. So says a Princeton study released this month as developed and developing countries try to thrash out Co2 caps amidst the usual blame game. Most of the world’s emissions come disproportionately from the wealthy citizens of the world, irrespective of their nationality, reports the survey, estimating that in 2008 half the world’s emissions came from just 700 million people. At present, the world average for tons of Co2 emitted a year per individual is about five tons. Each European produces about 10 tons p.a., with each American producing twice that amount, most of the emissions coming from airplane flights, car use and the heating and cooling of large homes. And while we’re about it , what about the a/c bill in some of those kitschy Louie Kanz palaces, be they in Dubai or Jakarta...
Bundanoon bans bottled water
Those who watched Balinale’s screening of “FLOW” up in Ubud a month or so back will no doubt raise a cheer for the residents of Bundanoon, New South Wales, who have roundly given the finger to the bottled water industry and it’s toxic plastic bottles. Bundanoon residents, population 2,500 just 100 miles South of Sydney, were so pissed by plans of a Sydney bottling company to take their water, for nothing, truck it up to Sydney and then sell it back to them that the town has voted virtually unanimously to ban the sale of bottled water outright. In 2008 Australians spent almost US$400 million on bottled water.
....as goes Bundanoon, so the US?
Hardly, but the US may be headed that way, judging by a Congressional report released this month, which said bottled water makers con millions into believing their products are purer than tap water and better regulated. It not true, congressmen were told. What’s more, the FDA has little if any oversight of the industry. In recent years bottled water has frequently been recalled due to contamination from arsenic, bromate, cleaning compounds, mould and bacteria. Americans pay top dollar for bottled water, which can cost up to 1,900 times more than tap water and uses up to 2,000 times more energy to produce and deliver it. Americans drank 8.7 billion gallons (323 billion ltrs) of bottled water in 2008 or 28.5 gallons (108 ltrs) a head at a cost of some US$11.2 billion.
Wal-Mart to intro’s Sustainability Index
For a company renowned for its low prices, as much as its stinginess with employees, it’s good to see the company taking the retail lead when it comes to suppliers and sustainability. Wal-Mart have come up with tags going a lot further than the few sustainable goals a few retailers currently provide. Wal-Mart are to introduce a universal rating system covering most of the social and environmental implications of production with an overall sustainability index. Environmentalists are both surprised and delighted. “Nobody else has the clout to pull this off”, said a spokesman for the Environmental Defense Fund. Wal-Mart suppliers are expected to play ball. “Those choosing not to participate will not be penalised”, insists John Fleming, Wal-Mart’s chief merchandising officer, “they will just become less important to us”, he adds darkly, should anyone miss the point. Procter & Gamble, Costco and Target are expected to sign up to the Index.
EU fears US-Sino Eco “stitch-up”
Following the recent G8 meeting in Italy the EU, while delighted that the US has finally come to the party passing legislation this month to curb Co2 emissions, is worried that the US and China, the two largest GHG emitters will cut a separate deal and push the world into an agreement that does too little to curb emissions in the short term to make overall target for 2050 no more than a pipe dream.
Last year the G8, including George Bush’s US, agreed to an “aspirational goal” of cutting GHG emissions by 50% by 2050, accepting that in order to achieve that developed countries would have to cut their emissions by 80%. Meantime both the Obama administration and the Chinese are showing reluctance to adopt any enforceable short term commitments toward that goal. For its part, China doesn’t want to agree to firm short term steps, preferring to address questions of technology transfer and negotiation to avoid Co2 tax and trade wars.
3 Eco Cheers for Raffles & Club Med!
The latest news from Bali’s own Ms Carbon Footprint, Amanda Pummer, who heads up The GreenAsia Group’s (TGAG) Bali-based tourism related activities for the region, continues to bear fruit. Alas, not yet in Bali, but at least in Malaysia and Cambodia, where first out the starting gate are the Raffles Siem Reap and the Club Med, Cherating. Both properties undertook a self-audit last month giving them a benchmark for their entire current ecological stance - the good and the bad. The audit takes Amanda, an ex-hotel GM herself, five days to conduct at a cost of US$1,200 per property. Experience shows properties can recoup that in days, once they know what to look out for. The next step is to go on and measure their full carbon footprint , which is where the big savings in cash and emissions kick in.
“Any Bali takers yet?”, I ask. Not so far, says Amanda. “So why not? It’s not that expensive”, I say. Noting Amanda’s slightly quizzical air..... “Really!! Well, if that’s too rich for their blood why don’t some of them gang up and share?”. That’s an interesting thought , she says.
Hotel, business or household you can all audit yourselves, be an eco-hero Grade 2, take the first steps and probably save a handy sum of money too. Just go to www.thegreenasiagroup.com and it’s all there.
