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The spectre of climate change evokes extreme reactions ranging from the sombre and sanguine to the silly and sensational. While denialists occupying one side of the schism cock a finger at the very idea of global warming, prophets of doom residing across the divide calculate the exact year when there would be the onset of an apocalypse. In February 2022, the Intergovernmental Panel on Climate Change (IPCC) issued what has until now been its direst warning to the world. In the words of Hans-Otto Pörtner, a co-chair of working group 2 of the IPCC, “Any further delay in concerted global action will miss a brief and rapidly closing window to secure a liveable future.” Turning a blind eye to increase in global temperatures beyond 1.5C above pre-industrial levels, would, according to the IPCC report lead to certain “irreversible” impacts. These include the melting of ice caps and glaciers, the drying of peatlands and the thawing of permafrost and setting off of wildfires with the potential to wipe out many endangered and abundant species of animal life from the Planet.
So can this alarming trend of greenhouse gas emissions be reversed? Do we still have time on our hands and hope in our hearts? Eric Lonergan and Corinne Sawers opine that we do indeed have the requisite time and technology to redeem our planet. But this would take instituting paradigm-shifting policies and changes at the individual, corporate, national and global levels, which can rapidly accelerate the pace of positive change. In other words, Lonergan, (economist and best-selling author), and Sawers, (a climate consultant), call for “supercharging” the business, consumer, nation and the globe.
The ideas advocated by the authors in their downright fascinating but provocative book, are epic – in a literal sense. Sawers and Lonergan have at the edifice of their arguments, the concept of what they term “EPICs”. An acronym that expands to read Extreme Positive Incentives for Change”, EPICs is founded on the logic that positive incentives work better than negative incentives (hence the proposal for a contingent Carbon Tax based on performance indicators that reduce emissions at the ground level rather than a convoluted mechanism of Carbon Tax that may be viewed as regressive), and extreme incentives can trigger rapid changes in collective behaviour (a slew of exemptions or concessions in tolling fees, parking charges etc for Electric Cars can attract consumers towards procuring more EVs). EPICs also can have a targeted focus by concentrating on the sectors that threaten to cause the maximum damage in terms of Green House Gas emissions. For example, global emissions would plummet by an astounding 75%, if electricity was to be generated with zero emissions, and transport, buildings and industry are all powered by such ‘green’ electricity.
EPICs combine technology with more than just a trace of activism. Technology needs to be responsible for promoting substitutes for polluting goods (plant-based burger or lab grown meat in place of existing forms of meat). Activism would encourage significant competing vested interests in the green sectors –wind farm and solar industries lobbying against oil. EPICs combat issues that can be categorised into three simple buckets –‘simple maths’, ‘mini-Musks’ and ‘herding sheep’. ‘Simple maths’ represent problems where the technology to solve them already exists, is scalable and all that is required is the right mix of pricing incentives. “mini-Musks” are problems where we need technological breakthroughs, ‘and a willingness to throw billions of dollars at research and development, with highly uncertain returns.’ ‘Herding Sheep’ represents activism targeted at social stigma to cancel consumerism. For example by entering into Global Trade Agreements (GTAs), the world’s largest importers of steel can, by promulgating exacting and uncompromising quality and environmental standards, phase out carbon-intensive steel and ‘create a global drive to produce green steel at scale.’
EPICs are further bolstered by the fact that every sector and every industry has the threat of a ‘transition risk’ looming over their heads like a Damocles sword, in addition to physical risk of climate induced catastrophe. Social stigma and shareholder exclusion are a headache for all businesses in general and listed behemoths in particular. Lonergan and Sawers place emphasis on public reporting Science Based Targets initiative (SBTi) as key elements in the EPICs framework. SBTis can incentivize a healthy ‘race to the top’. SBTis would mandate that the relevant companies report their emissions using the scopes framework. The State would then put companies on notice, and warn them that if they do not get close to industry best practice on emissions, they could face a windfall tax on profits within five years. This would incentivize companies to compete on cutting emissions. It also tackles vested interests in a fair and transparent way.
Yet another innovative solution proposed by the authors involve transferring the ownership of stranded assets owned by fossil fuel companies at peppercorn or bargain basement prices to impact funds incentivized by sovereigns, would be far more effective. The funds, in turn would decommission such assets, and return investors their expected capital over 10–15 years, rather than the 30 years of remaining operation.
A ‘serendipitous’ situation of rock bottom interest rates that are prevailing in most of the economies in the world, is a godsend in the process of supercharging, according to the authors. Such low or even negative interest rates can be used effectively in ushering in policy prescriptions for investment in the form of targeted lending, bank regulations, asset purchases, loan guarantees, and a green national endowment. In other words, central banks would proceed to lend to commercial banks at negative interest rates. However, such lending would be contingent upon the condition that those funds are on-lent fund new investment in sustainable energy infrastructure. An added caveat would be an inextricable linkage to such discounted lending and the ultimate benefits in the form of cost reduction being passed on to the end borrowers/customers.
EPICs would also see its fair share of losers. Assets owned by coal-fired power plants will over a period of time see their values completely eroded. Even though Lonergan and Sawers assert that such assets and the businesses to which they belong are “owned by a tiny percentage of the population”, this alarmingly reductionist approach is where my only bugbear with this otherwise compelling bouquet of out of the box solutions stems. According to Lonergan and Sawers, “less than 0.1 per cent of the global population owns coal, oil, and natural gas assets. Gas is a critical transition fuel, but it will eventually lose its value, if on a slower timeline than coal and oil. These assets tend to be owned by theocracies, thugocracies, and a fraction of the “1 per cent”.”
While I care a fig leaf about the unscrupulous corporates and their chieftains who have unjustly enriched themselves at the cost of society, fossil fuels still form the basis of sustenance and the livelihoods of millions will be imperiled if the industry was to be allowed to go bankrupt. Workers, whose livelihood depends upon working in hazardous climes and construction sites might not be well equipped to make an abrupt transition to a completely green alternative since upskilling is a gradual process. Hence there needs to be a handholding transitionary period wherein the State provides the necessary social and economical support to such displaced workers by way of welfare schemes such as a Universal/Conditional basic income, Minimum Guaranteed jobs during the stabilization period (akin to the MNREGA scheme in India) etc.
“Supercharge Me” is one amazing, breezy and cathartic read. The experience is further accentuated by a plethora of transformational real life examples. The Norwegian company Oersted’s transformation from an oil and gas company to one of the largest wind farming organisations in the world, Engine No.1 ‘s shareholder activism against the $250 billion dollar monolith Exxon, India’s jaw dropping advances in positioning solar power as a viable alternative to the fossil fuel industry (Between 2014 and 2020, India’s installed capacity of solar power burgeoned 13-fold, to 36 gigawatts. This increase within such a short span of six years, exceeded approximately four times Spain’s entire installed capacity!), all make for some riveting reading!
“Supercharge Me” is mandatory reading for market makers and mavens of policy alike. But most importantly this book needs to be read by every citizen who wishes to institute a change at the individual level in humanity’s existential combat against the cataclysmic consequences of climate change.