ELON MUSK ON CLIMATE CHANGE

This article looks into Elon Musk’s perspective on climate change. Elon Musk has been in the news a lot recently. This is partly because of the Thai cave controversy and partly because of his trialling out of an idea to take Tesla private via his Twitter feed.

But next week is Climate Week, so I thought it would be topical to look into Elon Musk’s perspective on this important issue.

elon

He is a rarity in being a CEO who is fully aware of the need for breakthrough exponential technologies to solve the pressing social and environmental challenges. As opposed to the more incremental thinking that abounds in most boardrooms. His perspective on climate change is therefore of a great deal of value.

The inspiration for this article is drawn from the excellently titled video, which you can find via the link below.

Elon Musk’s Unbelievably Simple 12-minute Killer Break Down on Climate Change

 First of all, Elon Musk displays a very good knowledge of the carbon cycle and how it is being knocked into disequilibrium by the extraction and burning of fossil fuels.

carbon 2

Towards the beginning he has a very sharp breakdown of the problem, which you can find below.

“It’s really quite simple. We’re taking billions of tonnes of carbon that’s been buried for hundreds of millions of years and is not part of the carbon cycle, taking it from deep underground and adding it to the carbon cycle. The result is a steady increase in the carbon in the atmosphere and in the ocean.”

I find the graph below which shows that carbon has gone into an almost vertical climb since the industrial revolution very instructive for laying out the nature of the problem.

CARBON 3

This was followed by my favourite section of the video which centred around the inevitability of the transition to renewable forms of energy. The question is, will this be drawn closer because of the constraints that climate change imposes?

carbon 4

I thought it was interesting that when Elon was talking about technologies to power the sustainable energy era he mentioned nuclear alongside hydro, solar, wind and geothermal forms of energy. Which aligns with my own perspective, which is that in areas not on geological fault lines, nuclear power makes a lot of sense.

Elon’s perspective on the hidden subsidy behind carbon emitting activities is welcome. These activities place costs on the environment and society that unless corrected are not paid for. This is not how healthy markets function. This subsidy to the fossil fuel industry could amount to $5.3 Trillion according to the IMF.

Elon’s suggestion for a non-partisan revenue neutral carbon tax was a very interesting idea and was the first time I have heard of such a proposal. This would mean that only those using a high level of carbon would pay an increased level of taxation.

I was surprised by Elon’s belief that the 2°C warming will be exceeded with the only question being whether it is considerably higher than that. This shows how far politicians are from reality with commitments made at the Paris conference to limit warming to 1.5°C, but these are not being backed up with ambitious measures to reach this goal.

What you need to know

This article looked into Elon Musk’s perspective on climate change.

I think the most striking outcome of the Elon Musk video was his passion for a revenue neutral carbon tax. This is interesting as he could have easily used it as an opportunity to plug electric vehicles or solar power as the solution as he has businesses interests in these areas.

A carbon tax sounds like a very smart idea to move progress towards sustainable energy at a faster rate. I am however pessimistic about the level of debate that is occurring on this issue as you don’t see this being debated anywhere. The revenue neutral nature of it would make it less of a partisan issue.

In conclusion then, Elon’s perspective on this important issue was interesting and different to what I would have expected.

Next week is Climate Week so If you are hosting your own affiliate events or attending the main event in New York, I hope you have a great time and change some people’s perspectives on climate change.

Thank you for reading,

By Barnaby Nash

Please share your thoughts in the comments section below or reach out to me on social media. What do you think about the possibility of a carbon tax?

Let’s stay connected

I can be reached on LinkedIn and on Twitter @FollowBarnaby

MARGINS & SUSTAINABILITY

This article looks into margins and sustainability. Margins matter. They are the lifeblood of all businesses and everybody within an organisation should be made aware of how important they are.

sky

A lot of people who are passionate about sustainability make the connection that because it involves a focus on energy efficiency and the resources that are entering and exiting a business that this would be good for the economic health of the company.

There are a number of high-profile studies that verify that this is the case. I came across a paper by Boston Consulting Group recently that I found particularly interesting. Their 2017 paper Total Societal Impact: A New Lens for Strategy serves as the point of departure for this article.

I think that instances of support for sustainability and corporate responsibility are particularly important when they come from mainstream and established sources such as Boston Consulting Group. It works to highlight that we are operating in a new paradigm.

Their study found a link between Environmental Social & Governance  performance and margins. This held across a number of industries.

In consumer-packaged goods gross margins were 4.8% higher for the top sustainability performers when compared to the median performers.

In biopharmaceuticals margins were 8.2% higher for the top performers on expanding access to drugs when compared to the median performers.

I thought this was a strange one, but their findings even showed that in oil and gas top performers on health and safety had margins 3.4% higher than the median performers.

In financial services, margins were 3.4% higher for top performers on environmentally responsible sourcing when compared to the median performers.

What you need to know

This article looked into margins and sustainability through the lens of the 2017 Boston Consulting Group paper.

What this shows is, is that for business leaders concerned about margins, that an organisational focus on sustainability is a good way to ensure success in this area.

Margins matter and sustainability matters. So, it is fruitful that a link was found between these two important areas.

Thank you for reading,

By Barnaby Nash

Please share your thoughts in the comments section below or reach out to me on social media. What do you think about the link between margins and sustainability?

Let’s stay connected

I can be reached on LinkedIn and on Twitter @FollowBarnaby

THE HIDDEN COSTS OF RENEWABLE ENERGY

This article looks into the hidden costs of renewable energy. As we bring this series which has looked into the hidden costs of driving, coal power, natural gas and nuclear power to a close, it was only right that we look into the hidden costs of renewable energy.

renew

This is especially important at a time when the UK has recently opened the world’s largest windfarm.

In the 2017 work Drawdown edited by Paul Hawken, they revealed that onshore wind was the 2nd most effective activity to combat climate change and offshore wind was the 22nd most effective activity. So this is clearly an important arena that needs to be investigated, to see if there are any hidden costs.

Again, this article takes as its point of departure, the 2009 Hidden Costs of Energy study by the National Academy of Sciences.

Renewable energy has a number of advantages over its fossil fuel and nuclear rivals. Because no fuel is involved, no gases or other contaminants are released during the operation of a wind turbine.

However, their study did identify hidden costs in potentially adverse visual and noise effects, and the killing of birds and bats. With that being said, wind-energy plants do not kill enough birds to cause population-level problems, except perhaps locally and mainly with respect to raptors. The authors do caveat their study with the warning that if the number of wind-energy facilities continues to grow, bat and perhaps bird deaths could become more significant.

Another important outcome of their study was their finding that for the effects of solar and biomass generation of electricity, they saw no evidence that these sources currently produce adverse effects comparable in aggregate to those of larger sources of electricity.

What you need to know

This article looked into the hidden costs of renewable energy.

We looked into the advantages of wind energy, which is an exceptionally clean source of electricity.

We looked into some of the hidden costs of wind energy, which include visual and noise disruption as well as hazards for birds and bats. Overall, the benefits of this technology considerably outweigh the costs.

We looked into the National Academy of Sciences paper, which could find no hidden costs for biomass or solar power, which is even more reason to back these technologies.

Thank you for reading,

By Barnaby Nash

Please share your thoughts in the comments section below or reach out to me on social media. What do you think about the hidden costs of renewable energy?

Let’s stay connected

I can be reached on LinkedIn and on Twitter @FollowBarnaby

 

THE HIDDEN COSTS OF NUCLEAR POWER

This article looks into the hidden costs of nuclear power. This is a power source which is fraught with controversy. Some will argue that it is indispensable to a sustainable future, others say that it has no place in a sustainable energy mix.

nukes

As this series which looks into the hidden costs of driving, coal power and natural gas continues, it is important that we look into this controversial power source.

Again, we use the National Academy of Sciences landmark paper Hidden Costs of Energy as our point of departure.

In the U.S. and the UK nuclear accounts for over 20% of these countries energy needs. France, who have a very aggressive nuclear power strategy generate over 75% of their energy from nuclear power. Even at the lower end this is a major power source and its hidden costs should be investigated.

What is clear in the National Academy of Sciences literature review, is that damages associated with the normal operation of nuclear power plants are quite low compared with those of fossil-fuel-based power plants. This does however exclude the possibility of damages in the future from the disposal of spent fuel, which introduces some risks.

The main risks and hidden costs of nuclear power emerge in the lifecycle phase. Chief among these is that if uranium mining activities contaminate ground or surface water, this could expose the public to radon or other radionuclides through ingestion. However, these risks materialise in the country where the uranium is mined, not where the nuclear power plant is located.

One thing that the study made clear is that low-level nuclear waste does not pose an immediate environmental, health, or safety hazard. The process of storing it until it decays to background levels mitigates this risk.

The study also highlighted that for spent nuclear fuel, if full-cycle, closed-fuel processes that recycle waste and enhance security were developed, this could further lower risks.

The authors also point out that a permanent repository for spent fuel and other high-level nuclear wastes is the most contentious nuclear-energy issue. They recommend that considerably more study of the external cost of such a repository is warranted.

What you need to know

This article looked into the hidden costs of nuclear power.

What should be obvious, is that when nuclear power plants are operating normally, they introduce few hidden costs.

They do however introduce risks via the uranium mining activities and if the plants cease to operate in a normal way.

Thank you for reading,

By Barnaby Nash

Please share your thoughts in the comments section below or reach out to me on social media. Do you think nuclear power has a role to play in a sustainable future?

Let’s stay connected

I can be reached on LinkedIn and on Twitter @FollowBarnaby

THE HIDDEN COSTS OF NATURAL GAS

This article looks into the hidden costs of natural gas. Natural gas burns cleaner than its principal competitors’ coal and oil and so it is sometimes touted as a bridge fuel that can be used to smooth out a transition towards a renewable energy future.

flare

This article takes the National Academy of Sciences 2009 paper Hidden Costs of Energy as its point of departure.

Overall, gas tends to be a cleaner fuel, with less hidden costs than oil and considerably less hidden costs than coal. In the 2009 National Academy of Sciences paper, where they surveyed 71% of the USA’s gas-powered plants, these produced $740 million in aggregate damages from emissions of SO2, NOx, and PM. These are hidden costs not accounted for in the marketplace but which have a very real impact. The figure is however lower than the figure for coal, which amounted to $68 billion.

Their study did however reveal that coal plants tended to be much larger power sources than gas, with net generation at the median coal plant being more than six times larger than that of the median gas facility.

A similar conclusion was drawn to the coal powered plants, whereby a very small number of plants are responsible for a disproportionately large amount of the hidden costs. In the case of gas, the 10% of plants with the largest damages produced 65% of the air-pollution damages.

Whilst coal is far more damaging for the environment, which means that environmental pollution control measures can have a big effect. In the case of gas, they were predicting only a modest increase in the cleanliness of this fuel into the future.

What you need to know

This article looked into the hidden costs of natural gas. A lot is made of the cleanliness of natural gas. It is certainly abundant and somewhat clean, with the ability to play a role in a transition towards a sustainable future, but the more limited the role, the better.

We looked into the hidden costs of gas power plants in the USA, which was calculated at $740 million per year, not including climate change impacts. This number is overshadowed by the incredibly high figure for coal, which demonstrated that if gas replaces coal generation, then that is a win for the environment. Providing this does not stifle the development of clean renewable alternatives.

Thank you for reading,

By Barnaby Nash

Please share your thoughts in the comments section below or reach out to me on social media. What do you think the world needs to do to move beyond natural gas?

Let’s stay connected

I can be reached on LinkedIn and on Twitter @FollowBarnaby

THE HIDDEN COSTS OF COAL

This is another article which looks into the hidden costs of economic activity. This week we look into the hidden costs of coal fired power generation.

coal

Coal fired power generation gets a lot of coverage because of the large amounts of greenhouse gasses that are associated with this activity.

But what if there are other, more hidden costs that make this activity even more dangerous.

In the 2009 paper by the National Academy of Sciences in the U.S. Hidden Costs of Energy: Unpriced Consequences of Energy Production and Use, they looked for exactly these types of costs and their findings were very worrying.

Their landmark study found that the total annual health related damages from sulphur dioxide, nitrogen dioxides and particulate matter created by coal burning in the U.S. amounted to $68 billion in 2005.

These annual costs are simply incredible. These costs do not include damage to ecosystems or the health effects of other air pollutants such as mercury.

Their findings also made clear that there were many coal-fired power plants with modest damages per kWh, but that there were a small number of plants that were associated with large amounts of damages.

I think that the findings from this study are interesting, because in the atmosphere where there are still some who are sceptical about climate change and its human origins, these health impacts can help shape the debate and make the argument for cleaner sources of energy definitive.

What you need to know

This article looked into the hidden costs of coal fired power generation.

This type of power generation contributes to $68 billion worth of health damages in the U.S. alone every single year. The worldwide figure would be staggeringly high.

Once the ecosystem damages are accounted for, there is no business case for this wanton destruction of society and the environment.

Climate change was a good reason to look beyond coal, but these health damages make the case stronger still.

Thank you for reading,

By Barnaby Nash

Please share your thoughts in the comments section below or reach out to me on social media. What do you think the world needs to do to move beyond coal?

Let’s stay connected

I can be reached on LinkedIn and on Twitter @FollowBarnaby

THE HIDDEN COSTS OF DRIVING

This article looks into the hidden costs of driving. What if everything is not quite as it seems, what if there are hidden costs to driving that make this activity costlier than it is commonly perceived to be.

Iceberg

The correct academic term for these hidden costs is negative externalities. These are the unaccounted for or unpriced costs of an action. I however am no fan of the word externality, I much prefer the word hidden costs as it exactly represents what it means.

This article is based around the analysis of Amory Lovins in Reinventing Fire which itself was inspired by a paper by Delucchi and McCubbin, which you can find here.

There is an old saying that there is no such thing as a free lunch, let’s now turn to the hidden costs of driving.

Driving [Reinventing Fire] eds

These include congestion delays. These waste everyone’s time and they make vehicle movements average speed extremely slow in urban areas. This is also an indicator that is on the increase. This is a major hidden cost of driving.

The next is accidents. This is an indicator that has been declining per vehicle mile travelled, but thanks to the increasing number of vehicles, the total number of accidents has been rising. Accidents, both to the driver, the passenger, other drivers, pedestrians and cyclists are a significant hidden cost of driving.

Pollution and health are hidden costs of driving. These are areas where thanks to technology, even though the number of vehicles bring driven has risen, emissions of all air pollutants from highways in the U.S. have declined dramatically since 1990. But there is a caveat that road transportation has high hidden costs because it is energy intensive and because the emissions and noise disruption take place in areas with high population densities.

Climate change is another significant hidden cost of driving. Until such a point where the majority of vehicles are powered by electricity, which is generated from renewable sources, driving will remain an activity with an outsize climate impact. There are also energy security risks which come from importing oil from far off lands. Thankfully an EV and renewable energy solution puts a country in total control of its own energy and vehicle power needs.

These hidden costs of oil powered driving in the U.S. have been calculated at $820 billion a year. You can find a summary of the estimates in the Delucchi and McCubbin paper below.

Externalities [Delucchi and Mccubbin]

$820 billion is a staggeringly high figure and shows why a transition towards more sustainable forms of transport is needed so badly. This must include rapid public transportation options and roads that make walking and cycling feel safe and enjoyable.

What is not needed is continued expansion of dedicated vehicle parking spaces, and parking spaces being provided at below market rate. Changes in these areas would go a long way to reducing the hidden costs of driving.

What you need to know  

This article looks into the hidden costs of driving. We looked into a combination of the analysis of Amory Lovins, and Delucchi and McCubbin.

We looked into how driving in the U.S. creates external costs of congestion, accidents, pollution, climate change and noise which total $820 billion a year. Whilst the U.S. is one of the most car centric nations, these figures may be lower in other countries, but external costs will still be present in some capacity.

There is also the significant external cost for oil importing nations, who must rely on far off lands for the fuel that powers their vehicular transport. A much smarter solution would be for car transport to reflect the hidden costs that it imposes on society and the environment. This would make walking, cycling and public transport more competitive. A smart policy would also heavily favour electric vehicles which have lower hidden costs and can be powered with renewable energy which is generated domestically.

Overall, far from being a benign form of transport, oil powered cars create a significant burden through the hidden costs of driving.

Thank you for reading,

By Barnaby Nash

Please share your thoughts in the comments section below or reach out to me on social media. What are your thoughts on the hidden costs of driving?

Let’s stay connected

I can be reached on LinkedIn and on Twitter @FollowBarnaby