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Foreign Policy Analysis
Energy Leapfrogging or Carbon Imperialism? #SkollWF 2017

Energy Leapfrogging or Carbon Imperialism? #SkollWF 2017

My name’s Emily Wilson. I’m a journalist
at the Guardian and I’m responsible there, amongst other things,
for our environmental coverage and also our global
development coverage. The subject today is
Carbon Leapfrogging; should emerging economies
such as India be expected to go directly from where they are now
to a perfect clean-tech future, jumping over fossil fuel development? Should they? Can they?
And is it fair to ask them to do so when the current developed world
has been built on fossil fuel? The sort of ethical bit of it,
I know President Nasheed hates it, but it is a live argument
in bits of the world. I’ve just been living
in Australia and there the energy minister, Josh Frydenberg, last year talked about the strong
moral case for coal because Australian coal was giving electricity to
poor Indian children and lifting them up, and saving countless lives. So first we’re going to ask our two
speakers to introduce themselves, the work they’re doing right now, just to give an opening sally
on their reaction to the subject today. But we’ve lost one speaker,
but the other speaker, Dr. Dan Kammen, unfortunately, cannot be here
for family reasons. So first, President Nasheed
is the former President of the Maldives and is a man who’s been imprisoned
and tortured for his political beliefs. Would you tell us a bit
about your work now and what you think about
carbon leapfrogging? Well, thank you very much
and good morning. I am in exile now. We were toppled in a coup in 2012 and then I was later arrested. I spent another year in jail. I was fortunate to leave the Maldives,
leave the jail for medication and then I sought asylum
in the United Kingdom. So that’s where I stand. When we were in government
we had a view that we could make the country
carbon neutral. For the Maldives, electricity generation
through diesel is very expensive. Sometimes it goes to about
seventy cents a unit. And you would know today
renewables are far cheaper. It can be as cheap as —
I understand recently in India one of the bids were
cheaper than coal. If you take another country
in South Asia, Sri Lanka, it produces 1,300 megawatts of diesel-generated electricity
at a cost of thirty cents a unit. You can do the same in Sri Lanka
for twenty cents a unit. The Sri Lankan international reserves
or the Sri Lankan economy would save $1.1 billion if they switch. And for me, I have come to believe
and understand that there is a low carbon
development strategy. That development need not always
be equal to carbon emission. You can have the same economic outcomes
or rather, better economic outcomes, through a different economic path
or different way of governing a country. In the early part
of the last century, governments were run
on Keynesian economics, most of them were run
on Keynesian economics, with stimulus packages
stop-go policies, and so on. But when we came to the end
of the century, the late ’70’s and ’80’s, governments started running
their economies on monetary, through interest rates and so on. I have a view that these
received economic wisdoms are also obsolete as much as
the coal fossil fuel technology. And there is another economics, another view, another ideology,
a theory, that you could use
to run countries. What I am trying to do now
is to make climate change an election issue in countries. In my view, to do that
we must formulate a low carbon manifesto
or a political manifesto that political parties can embrace and hopefully politicians than can
make the same kind of pledges: full employment, housing, sewage systems,
embankments, and so on. But these political pledges to be
based on the new manifesto which would be an environment-friendly manifesto. We must find a name
for this manifesto first. You would remember at the beginning
of the last century communism came to be
a ruling method or rather, countries took that
to be a way of governance. And it went on until late this last
century and then it collapsed. So we are now in need
for a new thinking, a new manifesto,
a new political manifesto. So my work now centers around,
part of my work centers around, trying to formulate
that new manifesto and trying to see if political
parties who lose elections and who are now thinking on how
to win the next election, to give them ideas on how
to win an election. So I believe that you can win
an election through these new ideas, making new pledges, same pledges
but through a different path. I think I’ll stop there. I mentioned that
this is part of the work that I am doing. I’m still the leader of the opposition
in the Maldives, so I keep doing that work and I’m hopeful to be back
in the Maldives soon. Over to Dr. Samir Saran, who’s Vice President
of the Observer Research Foundation. Thank you, Emily.
So he’s been to prison, he’s in exile, and he’s also tortured himself by hosting
cabinet meetings underwater. I have not had these experiences and the closest I’ve been
to hardship was my time at the London School of Economics
and then in Cambridge here. I never had the privilege
of being in this town Oxford. So, I want to respond to a couple
of points made by you, Emily, in your opening introduction,
as well as by the President, and let me try and also respond to the theme:
energy leapfrogging or carbon imperialism. So in 2015, as we were moving towards what later became the Paris Agreement,
there was hectic negotiations on the sidelines leading up to the conference
between France and India, U.S. and India, U.S. and China,
France and China. India has always been the leader
of the global trade union; we are the opposition leader
of the world, so when we want a global
agreement we say no. So it was important
to get India on board, and under Prime Minister Modi
there seemed to be an opportunity. If he could appeal to his imagination
to take India towards a new direction there was hope that India this time
would agree to an agreement. So after one of the meetings with
the representative of the United States and one of the advisors to the Prime
Minister on climate change, the advisor asks me, “What was the U.S.
representative offering us?” He asked me this question,
what was the offer on the table? I said, “The offer was quite simple.”
The offer was one: China was the last country
that would use fossil fuels to lift its poor to a middle
income existence. India will be the first
country in the world who will have to do that same
task without using fossil fuels. That was the first proposition, that India
will be the first country in the world that will move millions out of poverty
to low-income and middle-income existence without using fossil fuels,
without bulk manufacturing, without huge exports over long distances
because that’s unsustainable. The second offer was that
because India has to lift 300 million people out of poverty, we are sorry, we don’t have the money
and the means to help you. So you have to do it
largely on your own; find your own solutions
and find your own answers. And third, even though you will be
the first country in the world of significant size to do this ever, and you will have to do it using
your own means and resources we want, in an agreement,
the right to judge you. We want to have the right
to monitor your progress. And this was the proposition to India
placed before the Paris Agreement. And then he asked me,
“So what should we do?” I said, “Accept it,”
because it is also the fourth and the unoffered part
of the proposition was that you will be the first country in the world
to create a new model of growth that which by itself will be exportable
to the whole world. So if the Japanese gave us
a certain kind of manufacturing; if the Chinese gave us
mass manufacturing; if the industrial models of Europe and
America were exported all over the world; this new Indian model of transformation
is by itself a deliverable. So yes, energy leapfrogging
is clearly a part of it. Let me share some
numbers with you. I did a study which was published
in that same year, 2015, by the Brookings Institute
in the U.S., and I found that every Indian
as a relative share of his expenditure spends nearly two and a half times
more than an average American on procuring renewable energy. So every Indian spends
two and a half times more than an American on procuring
renewable energy. They spend four times more
than every Japanese; they spend one and half times
more than every Chinese, and they spend just under
two-thirds of that of a German. The Germans are still the gold standard
when it comes to renewable. But let me complete that thought. By 2022, India is determined to have
175 gigawatts of renewable energy in play which is more than the entire
generation capacity of Germany. So we are going to,
in the next seven years, install 135 gigawatts
of renewable energy which is roughly what Germany
has installed over 200 years. That is the task in front of us. I’m just scoping the challenge of what
energy leapfrogging really means. We must start understanding this. But that does not mean…
and here I disagree with the title, I don’t agree with the word ‘or’. I think energy leapfrogging is happening,
is required, is ethical, but carbon imperialism exists. And let me share another
set of numbers for you. First of all, the proposition made
by the U.S. itself was imperial. I think itself was unethical. It smacked of three distinct
traits of imperialism. One, we know and you don’t,
so hence, do as we know. Two, that we have
the moral fabric to tell you this; we have the moral fiber or we have
the ethical high ground to tell you this because our actions somehow are through
enlightened politics and yours are not. And third, we have the courage
and we still have the capacity to patronize you by talking down on you.
And let me complete this thought again. During those negotiations when we asked
the block of the EU and Americans that why don’t they tell the banks
to divert more money for finance, why don’t they tell technology
companies to bring down IPR, they say — they don’t listen to us,
it’s market, it’s market forces. And the Brazilian negotiator tells them,
“But you believe that we will listen to you because you still believe that you
have the imperial power over us. That you can’t tell your companies what to do,
you can’t tell your banks what to do, but you can come to the emerging and
developing world and tell them what to do. So you still believe that there exists
this political equation where you can tell us what to do.” So carbon imperialism also exists,
and let me share a few numbers on that. Again, a study that
was published by the European Council on Foreign Relations
in 2016 beginning, my study on coal, I discovered that an average American burns
five times more coal than an Indian does; an average German burns three times
more coal than an average Indian does, and of course, the Chinese
are global champions on this, six times more than
an average Indian does. So what I’m trying to say is,
Emily, you raised the point that it is moral to export coal
from Australia to India… No… -Josh Frydenberg said it and you were quoting him.
-Yes. Let me qualify that.
I think it will be moral till such time that even one gigawatt
of coal capacity exists in Europe. I think for every plant that South Africa,
Rwanda, Kenya, Nigeria want to set up of coal, one must
shut down in Europe and the U.S. And I think the morality argument will remain
valid till we see dramatic action here. In fact, last year,
Germany has decided, has announced between 14 to 16 plants
depending on various news reports; the OECD has 58 gigawatts of coal capacity
in the last seven or eight years; and due to voodoo science,
by banning nuclear Germany today has ten times
dirtier electricity than France. Germany’s voodoo science that has
decided to ban nuclear is as voodoo as Trump’s voodoo science that
believes climate change is not happening. I think we are at two extremes here, and I believe that some of the
liberal ideologies are as rigid and will defeat solutions as severely as some of the policies of the right. And I will leave my opening
remarks here. Since you did raise President Trump, what impact do you think
he’s going to make on the world’s groping, however inadequate,
towards a carbon free future? -Groping?
-Well, you know, stumbling. Bad word. Bad word. Yes, bad word. My worry is whatever Presidents say, what’s happening in the world
is what the people are doing and the American people and a large
amount of people in a number of countries have decided that we have to change, that things can’t go
business as usual. And therefore,
I don’t think there is any politician or political leader who can
actually turn this around. You can love coal
as much as you want. You can be as imperial as you want to be,
but this will be ongoing. There is nothing,
nothing anyone can do about it. It’s already an economic argument. It’s the profit motive and the market
mechanism will save the planet. Unfortunately, it will not
include the Maldives because it’s a little bit
late for us. But by and large,
my view is that it doesn’t matter. It really doesn’t matter. We have set in motion a process that would deliver
another economics, that would deliver another
industrial path. And I am sure India’s going
to embrace that because India would be
the future leaders and if you are unable to embrace
the new technology, if you are unable to embrace the future,
you cannot be the future leaders. If the United States,
the people of the United States want to relinquish their world leadership,
well, they can do that. But that’s not going to stop
the rest of the world. And that’s not even going to stop
the United States from transforming. So, for me, political rhetoric is really
not part of this equation at all. It’s going, the train’s left,
and it will go to its destination. Are you — sorry,
thought you stopped. Yeah, I had. Are you… That’s really optimistic
and good to hear. Are you as optimistic? You know I agree with the President.
I think he’s right that countries like
India have decided that they are going to adopt a different
pathway and that was my opening point. But I probably, in a sense,
nuance his position and mine by saying that imperialism still exists
which means that you are going to see countries
try to derive maximum benefit and power and influence
by control of technologies; by control of returns on investment; by making sure that the benefits
of this new economic pathway still remain concentrated
in only a few economies. And I think those are questions
we need to think about. But on the issue of popular leaders
or populist leaders, like Trump,
and their impact on the debate, I think you have two examples
in recent times. You had two leaders who
were appealing to constituencies which were very different to the ones
that elected previous statesmen. One in India, for example,
and one in the U.S. And Prime Minister Modi used his popularity
amongst his cadre and the masses to actually shape the narrative
towards a solution at Paris. So he was able to bring
the culture and context that Indians traditionally
have lived as one with nature; the global community is one village;
our actions impact everyone; we have to do this for all
of the citizens on this planet; and he was able to move India from
being the head of the global trade union to being part of the global management
of this big crisis. So here is one instance
of a popular leader using his popularity for
creating a solution. And Trump is using popular rhetoric to cater to a different
basic primal vulnerability, fear or a need of
a different constituency. But he’s right.
I think institutions are strong enough not to be swayed by four years
or eight years of leadership. I think the primary question
for me is not Trump. The primary question
is only one actor who has actually not signed on
to the Paris Agreement. There is one major actor
in the world who has still not signed on
to the Paris deal or the climate deal, and unless we bring them on the table,
energy leapfrogging will be more difficult and carbon imperialism will exist. And that one actor
is the global banking community. I did not see the bankers sign
on to the climate agreement. The global banking norms still don’t allow
more than X percent of total lending to flow towards renewable energy
or to flow towards green infrastructure. They also don’t allow flow of money to certain geographies because
they’re considered risky. And they price the money so high that is becomes unaffordable
for certain other geographies. The bankers have not signed on
to the climate deal. And I think unless you
bring the bankers in you are not going to be able
to fully realize the potential that this moment offers us. So the Trump presidency could be
detrimental to – it may delay the socializing of certain
actors by a few years, but I don’t think he can deny it. So how can the global banking
community be brought on board? Who can make them?
How can it happen? Well, we have this strange situation
where I keep on agreeing with Saran, but ORF writes a running commentary
on the political situation in the Maldives. How? Who? We’re talking
about Bretton Woods, the IMF, and the World Bank, and basically these two
very important institutions. Now, if I completely
agree with Saran here, if the financial world
is unable to understand the financial returns
from the new economy – again my argument would be that
they’re doing this because they’re ignorant; they’re doing it because
they’re stuck in another century; they’re doing it because they are obstructed by vested interest,
especially fossil fuel industry and everything related to that. So unless the World Bank board
and the IMF board decides to allow finance to follow to developing countries this is,
of course, going to be difficult. So our question would be
how can we overcome this? Perhaps, again,
I think the market must do it. People must realize, investors must
realize that they have a better return by investing in this new economy. And I think it’s quite clear that your one dollar invested
in renewables produces a better return and
a faster GDP growth than a dollar invested
in fossil fuel. So we need to do this math,
an economist needs to sit down and do this math, and say, ”Well, this is the return
that you have.” I think we need to change the climate change argument
or rather bring the climate change argument to a more economics argument
than an ethical argument. I mean, I do understand the ethics
of it and I do believe that it’s a human rights
issue as well, but we will not get going with it until we anchor this properly
as an economic issue. So we must have auditors, financiers, and economists talking about
this issue and doing sums so it makes it very
clear to the banks that they would get a better return
by investing in India now than for instance,
investing in some other place. So how do you calculate returns and how would you do these maths? So we’ve come to this point always arguing, always arguing that there
is a moral argument here. Of course, there is a moral argument here,
but there is a financial argument. And I would like people to point out
the financial argument to the bank. Your question was how will we get
the banks to release their funds? My view is that by telling them
you’ll get a better return. But the World Bank has got a relatively
new leader and he talks a great green game. He says that all their
development projects, they’re keeping the environment
in mind at all times. So they talk as if
they’re truly green. No, they are. I mean,
to be fair to the Bretton Woods, I think they’ve swung to the other end of the spectrum
in the last three or four years to the detriment of basic infrastructure
requirements in many countries. So they now use the green equation
for everything including providing social rural roads and infrastructure and how is that going to contribute
to this green agenda? I think – let me answer your question
in a different way. Let me unclutter the conversation
on ensuring financial flows. So there are three main issues – there are many,
but three main issues. One, of course, is the international infrastructure finance
and development finance institutions, Bretton Woods and the new banks
that have come up; the Chinese Bank, the BRICS Bank,
and some other regional development banks. So you have this one set of actors
who I think, more or less have, to varying degrees agreed
that green is the path ahead. Whether it’s the AAIB which is
lending money on renewable projects or the BRICS Bank which is committed
to a number of green projects in the first seven —
and the World Bank, you see this secular trend
towards a green agenda. The second actor
is the commercial bank which lend you money
from London or New York, a syndicate from Paris,
and other places. And they work under what we call
the Basel norms for banking, and it is the Basel norms
that restrict or allow movement of capital
to certain sectors. So they say that a percentage
of your lending is to be given to
the infrastructure sector. Now, unless that percentage
is increased or changed you will not be able
to direct more money to renewables because renewables
will be competing with all other infrastructure as well. And countries in the Global South need to build roads, need to build ports,
need to build coastlines, need to safeguard themselves from
high tides and rising sea levels. And renewable energy is actually competing
with all of these baskets of challenges that the developing world is facing. So, is it time to think
of a green Basel? So can we think of a new
regulatory framework where a certain amount of lending should
go towards green infrastructure projects? So can we create a new classification and a new segment of laws that
flow towards these kinds of projects? And the third actor, and which I think
is again a part of why I say where I’m sitting and your
neighbors are imperialists because you still sit on
the world’s largest chunk of money, lazy money — what I call lazy money
which gives you no returns, which are your pension funds
and insurance funds, and which are criminal in ensuring that none of the money
goes towards these sectors which are most important and to these geographies,
the emerging world, where it is most required. There’s a IMF report – and this is not
an Indian report, this is an IMF report – it says there are over
$150 trillion of global savings in these kind of big funds and there is still a $3 to $4 trillion
infrastructure gap in the emerging world. Just by the interest
rates of this money, you would be able to meet
the infrastructure gap in emerging worlds and
earn a much higher rate of return. In the next five to seven
years the EU, UK – and not the U.S.,
they’ve been smarter – the EU and the U.K. will certainly be unable
to commit to their pension commitments, to people’s retirement commitments because they have parked
their money which is now earning zero. Because their political will,
their regulatory will to allow this money to be
deployed as productive capital in some of the emerging parts
of the world is lacking. And this stems from the same mindset
that I was talking about that that is a barbaric world, that is an uncivilized world, we
don’t understand their politics, we don’t understand their people,
we don’t understand their language, and how can I park my money in that terrible,
terrible part of the world? And that is imperialism for me. Is it a lack of will
or is it ignorance? It is imperialism
and it’s a mix of everything from ignorance, to fear,
to lack of political will, but it stems from fear. It stems from not understanding
that someone darker than you can be more smart, can use your money more wisely. It stems from that basic fear that my life savings are going
to be in a Nigerian hand. And I think this is racist, this is imperialist,
and unless we get over this fear of the other being able
to now manage money in ways that are going
to be productive for you, you’re not going to be able to move
this huge part of lazy money to the green agenda,
to the infrastructure agenda, the SGG agenda, you know,
the larger SGG agreements that we’ve reached. Can I – in the Maldives to build
a water breaker a meter of it costs $4000; a meter of water breaker
in traditional ways of doing it and this technology
is in the 1950’s. And every time we want to build another
water breaker we, of course, do a project and give it to the World Bank. And the World Bank would make sure that this is done in the 1940’s
and ‘50’s technology or rather, they would lend it
when it is done in a technology that they’ve been usually lending to. And they would ask to do a design and this design again would be done
by someone who’s been picked by the Bank. And they would have assessing
and monitory mechanisms on if the design is fine. And then they would ask for a tender and we would tender it, and then
it would be taken by someone else and built. My point here is, the Bank must understand that there is
new technology to do exactly the same thing. There is a lot of smart
methods of doing things. Growing a mangrove is as efficient
and effective as building a water breaker. And I was told by a very young
physicist the other day, that you can actually produce
another wave from shore and neutralize the coming wave and therefore have this damn thing
done without anything. But at the same time, you could also, apparently, use this gadget
to power the village. So there’s a whole lot of new science,
smart ideas available and cheaper, and far,
far more cheaper. I think the finance is not coming to these
new ideas, to these new methods. That’s what I would like to
call the new pathway. That’s the leapfrogging – that’s where I would really like to
call leapfrogging this carbon and coming out exactly with the same outcomes,
economic outcomes, but through these different methods. I would like to compile
a body of new knowledge that is already here,
it’s all over the place, and it’s already working, but we are not installing
these new plans and methods. Simply because there is a guy
somewhere, in some bank, who hasn’t got a clue
on what we are talking about. And this person, the banker,
is very familiar with concrete and steel and therefore every solution,
apparently, every workable solution
is concrete and steel. So your question was, how can we
release this money from the banks? Yes, ignorance and not understanding it,
and not believing this. So, we must then, therefore,
promote this new technology. And again, I would argue that this new
technology would give you a far better return than going to obsolete technology. Dr. Saran, haven’t you – you mentioned earlier about people
keeping tech for themselves. What are you suggesting?
That people do open sourcing on clean tech? Are there people who aren’t doing that
who could be sharing big tech companies? What did you mean by that? So I think this is the third element. So the first is politics, second is finance,
and the third is technology. And I think our treatment
of intellectual property and our treatment of technology
still is framed around the First and Second Industrial Revolutions,
not the Third and Fourth. So we still have patents and rights, and the ability to extract
value from technology which was based on practice and which
has provenance from the previous century. The challenge is this – and let me try
to add to what the President said. This is the challenge: one of the biggest hurdles
to ramping up say, energy systems in
countries like India, is not just that the bankers and the insurance funds
and the pension funds think India is still mystical and undissolvable,
but also that the technology hurdle is now a new animal;
technology changes every few years. And the banks are worried,
“Are we making a risky investment?” So, for example, President mentioned
that in the last solar bid we have achieved parity to an imported
coal power plant in India. And all of the investments that would have
been made at the previous tariff rates four or five years ago,
are now obsolete. So there is a technology risk and I don’t think we have yet reached
a solution to pricing technology. Do we backend
the intellectual property? Do we place it alongside
the loan tenure? Do we do a completely ran
through a global R&D fund where we give a one-off
lump sum to the inventor and then we make it
a global public good? We buy it off the person and then we
make it available to everyone to deploy? I don’t think we’ve heard solutions yet
because even the big companies — and they’re normally the fossil fuel
companies who own green technologies. That is another interesting paradigm. It is the big companies who have made
money off the old economy who own the new technologies. So, in a sense, the commercial viability
of these new technologies is still dependent
on the fossil fuel economy. They will decide at what
price point they will cede it; they will decide at what time
it will become deployed widely because they also have to protect
their old business interests. So I think the technology puzzle
is a big hurdle. And again, I believe that governments
in developed countries have not done their job and they have actually bowed
and they have surrendered to the big companies, and they have
not enforced what I would call the stick policy. You have carrots and sticks
where you give incentives, but you also have a command
and control economy where you, for example, come up with
certain norms and certain rules that force mass deployment of some
critical technologies. And again, I think, this is a case
where you’ve allowed rampant exploitation of poor countries
for economic gains for a global public good. Should we open it up
to questions from you guys? Maybe if you have a question
you could introduce yourself briefly as well. Anyone have a question? This is so fascinating
and I’m sorry that I came late. In the U.S. there’s a group
of companies that are rethinking their focus
or their model by ESG, correct? And my question to you is,
you’ve been talking about government investment, but if the Bank of America, for example,
takes those criteria seriously they’re actually going to be looking
for green investment because, in part, their young employees want them to. And I’m just curious what the role — one, do you see sort of individual companies
making a huge difference, individual, big, private
entities making a difference? And two, do you see the next generation
of managers are thirty-somethings actually caring about these issues
slightly more in a way that might shift the kind of paradigm
you’re talking about, in terms of who’s investing
in old technology? So, the answer is, for me,
greed is an intergenerational trait; young bankers, old bankers,
they still work on the principle of greed, and I don’t see any fundamental shift
in investment decisions based on age. I don’t see a causal relationship
between age and how you invest. I think profits and returns still seem
to be the determinant in the banking — in the investment sector,
and in the banking system post the crisis. I think capital adequacy has become
this new throttle which prevents you from deploying
capital liberally. On your point of Bank of America,
good question. I think Bank of America will have
some leeway if it decides to go green. It doesn’t have too much leeway because it still comes under
the larger rubric of the banking norms determined to the Basel process,
and they would still have sectoral caps. So it’s only so much money that
they can deploy to a certain sector and they can’t do more than that. So, yes, within the sector
they will have some leeway of enforcing carbon compliance,
but it’s not too much and it’s certainly not adequate
for the kind of transformation. Let me go back to my first point. In the next seven years,
India is going to build 175 gigawatts
of renewable energy capacity; something Germany took
200 years to do with all fuels. Germany, with oil fuels,
is going to be at that mark. India is going to do it
in seven years. The kind of money India needs requires a huge revamp
of how we rethink global finance. And we are not asking for aid;
aid cannot do this. I made that first point. The world has made us an offer which is that we will not help you
and we have accepted their offer in Paris. We have said that this is what
we will do; if you can ensure flows of finance and technology
we can do more and we can do better. But we have taken that base offer
that says we are on our own in creating a new model that
no one else has adopted before. So global finance requires
a huge revamp if we’re required to scale up
to our missions. I think the Paris Agreement
still falls short of what we need to do. It’s a good start.
It’s a good beginning, but I think we have to be
far more ambitious, even in the — so for example in the Paris Agreement,
India has made a commitment of this amount of renewable
energy in 2030; our national action plan is 2022. So we are not necessarily going
to be waiting for the Paris Agreement tenure to end to achieve our goals. Hopefully we’ll be able to do more, but that doing more
is going to be predicated by being able to galvanize
global capital, by being able to ensure that technology
for good is available to all, and I think some of these key questions
need to be answered in the next three years when the Paris Agreement
kicks in in 2020. I think Bank of America
and most of these banks and everyone else would get their act together
once this becomes an election issue. So my work is on trying to see how we can
make climate change an election issue. My view is that once we transform
this to be an economic issue then it’s easy to lodge these ideas
in political manifestos. While it remains an ethical issue
or a human rights issue it’s not so easy to have them
in your political manifestos. Just imagine if the next U.S. election
is based on this new manifesto; how much of debate that
would make it possible, the dialogue would make it possible. So I would like to work hard
on trying to see if we can lodge these ideas. Now, I’d say the British Labour Party
would like to win the next election and the Democratic Party in the U.S.
would like to win the next election, the Congress Party would like to
win the next election, and my party would like to win
the next election as well. So, how do we win elections?
We win elections by promising things to the people, by saying we will create full employment;
by saying I’ll build you a sewage system; I’ll build you an embankment,
a road; I’ll build you a school; I’ll do this, this, and that. So if we could base these pledges on the new manifesto,
on the climate change manifesto, then banks starts to understand this. Banks would lend,
not because their workers are young, but because of profit motive. And now, it’s greed in some language, it’s greed in some language. -English.
-In English it’s greed and more polished-ley
it’s called the profit motive and the market mechanism. So banks would start lending
when the profit motive kicks in and the market mechanism
tells it to lend. I think you could do this once
it becomes an election issue. Question there from the lady? Sharon Burke with New America
and a former U.S. Government Official, so I’m not in a position to speak
on behalf of my country in any case, certainly not now. But Mr. President, first,
I just wanted to thank you for your continued global leadership on these issues,
and especially your constructive, optimistic vision which is, I think,
amazing for me that you continue to hold it and to lead the way forward
from your current perch. So, thank you very much for that. Making it an election issue —
I’m feeling encouraged and I’m trying to hold in
optimism what you’re saying, but it was an election issue in the United States
and not in a very good way. -It was a moral argument.
-Excuse me? -It was a moral argument, an ethical argument in the election.
-Right Sounding a great deal like Dr. Saran. He sounds like a Trumpista as a matter of fact.
You sound very much like a Trump promoter in a lot of your comments
about the moral imperialism of America. But I think that the problem is with
the politics in the United States that climate change, for some time,
has been playing a distractive element. And our question is
how to depoliticize and how to get it back to what you were saying,
also, that it’s an economic issue and it’s an infrastructure
and an investment issue? And how to make it something
that benefits the American public? I’m not sure how we chart
the way back to that and I’m not sure if we can because
of the amount of money and other interests that are invested
in the current dialogue. But I hope you’re right, that it can be a constructive
election issue. I’m not so sure. Just one other comment,
Dr. Saran, is that I was not involved as a government official
in the negotiations so I can’t comment on
the conduct of our team, but I would say as an inside/outside
observer myself, that I think it was the leadership
of the government of India and the collaboration and the dialogue
between our countries, our governments that helped transform the Agreement
and helped transform that negotiation. So I think I saw that as a very
constructive partnership and it’s alarming to hear you
describe it in such destructive term because I think it was
that joint leadership that your Prime Minister deserves
a great deal of credit for, that helped deliver
results in that case. So, hopefully, that’s the spirit
we’ll go forward in. What did I say that gives you the impression
that I have not actually complimented the leadership and the passion of Mr. Modi,
of Mr. Obama, of Mr. Hollande? That was my opening proposition, that despite being given an offer
that was sub-par, India has accepted the deal
because it sees in this deal reality, that energy leapfrogging is real. It is perhaps the only way forward. And irrespective of what the world
may or may not do, India has decided for itself
that this is its path forward. But that does not mean that I have to
support and condone American hypocrisy, and it’s not about Trump. The deal was struck
when Obama was in office. So I have said nothing
that supports Trump and I have said nothing that
condones my Prime Minister’s actions. I have said India has moved from
being the global trade union leader, the Mr. No to a Mr. Yes,
and that is commendable. And it is doing so off its own steam. So my position on this debate
is quite clear: Energy leapfrogging? Yes.
Carbon imperialism? Yes. They both can co-exist.
That’s what I’m saying. Can I butt in here? Yes. And then I’ll offer you one last comment
on the United States. What I mean by making
it an election issue is Keynesian economics
or monetary economics — now we fight elections
sometimes based on interest rates; other times based on
stimulus packages. Now, these are economic ideas. -So can you shift this conversation to be an economic conversation?
-Correct. So climate change is not
the election issue. -Employment is.
-Employment is. Sewage systems are. So, what I’m suggesting is
that there is a new received – there must be a new received –
the received economic wisdom is obsolete. And so it is time that we
come up with a new economics. I think and before we come up
with new economics, Mr. President, we need to come up
with a new vocabulary. -We speak a language that is only understood in this room.
-Yeah, exactly. Now, I can tell you there exists
sufficient case studies that will demonstrate the employment potential
of the renewable sector, of green energy, is more
than the coal sector, but yet the Democrats fought the election
on the basis of saving the planet. The man on the street
does not understand. Now please start speaking a language
that some of us can understand and don’t blame Trump for it.
You lost the elections. And I would dispute that and say that is not how the Democratic Party
in the United States ran, but that is how they were characterized
by their opposition, so.. And you had the media as well. Just one last thing about the United States.
I think where you’re going with that, Mr. President,
I completely agree with and I think you can’t underestimate how dangerous
this moment is in the United States, and how destructive this President could be,
especially to this agenda. However, at the state level and at the
sub-national level, and in Bank of America, and other quarters in the United States
I think we’ll continue to see progress. And the question is – and also,
you know, just certain economic forces. We’re going to continue
to see natural gas driving out coal no matter what
in the United States. So I think you’ll continue
to see progress but it’s difficult to underestimate
how dangerous the moment is, and particularly on this set
of issues in the United Sates. And so we can all love
to hate the United States but now we’re going to find out
what it looks like when it is actually a pernicious and
destructive element, so. Another question from someone? Dr. Saran, David Allen
from the Yajilarra Trust in Australia. We do a whole bunch of granting and investing
to promote or arrest climate change. I was first to applaud
your speech about how the white male investors
are stupid and racist. I think there’s a lot
of truth in that, but let me just add a little bit
of maybe self-reflection as an investor looking across the world
as to where do we put our money and what technologies and
what products do we invest in. India looks like a hard place
to put your money with the capital controls
and the ownership rules. So I can’t defend the system but I think there’s a little bit
you can do to help yourself. And I will struggle to defend India on that.
I think we have to do a lot more and the next two years of my research life
I’ll be spending exactly on this. How do we allow three kinds of investors
to feel more comfortable with India? Our domestic investors because we’re not even seeing enough
domestic investors put the money. So what do we need to change in our own
laws and in our own regulations to unlock the potential
of our own markets? We need to create more
financial market depth within the country, and we have done
very badly there, poorly there. Second, how do we bring you guys into the country feeling safe, that your money
is not going to be captured and you’re going to be allowed
to take it back, and your returns are safe?
And we need to give you that comfort. Again, I think it’s both a fact because
our policies need to be tweaked and it’s also communication;
the way we speak to you also needs to change. I think we can’t believe that
we are doing you a favor by allowing you to invest in India. It has to be the other
way around. So I think the tone of our
relationship needs to change. And finally, how do we convince these big funds
and big government sovereign funds all over the world to shed
the credit rating business and join in the climate campaign and
therefore to create more green infrastructure? And we will do it.
I don’t think the challenge is India here. I think we are halfway
through that process. We are now – we’ve literally doubled
our solar capacity in one year, last year. I think we are on the road and I see
India being able to find its own answers. I am more worried about
South Asia generally and I am more worried
about countries in Africa because eventually our investments
will crowd theirs out, and that is my worry. And we need more money
in the global system otherwise we will capture
the next flows like China captured the past
twenty years of financial flows. We are probably going to capture the next
ten to fifteen years of financial flows. So how do we create
more money in the market, so as to speak,
for some of these countries? But I take your point.
I cannot defend some of our policies that have prevented investment. But I think we’re improving.
I think there is a realization that this can’t go on. Did you have a question? Two comments.
Megan Fallone from Barefoot College. The first one is,
I think it’s important to call out and to recognize that
the government of India has not only taken the direction
that it’s taken within India, it is actually investing through us
as an organization, a social enterprise, in renewable energy development,
technology transfer, and vocational skill building through technology
in the renewable energy sector in now 26 countries around the world
in the developing Global South. And I think that is not an accident.
I think that is very much a conscious decision on the part of the government of India
to walk the walk and talk the talk. I’d like to come back and make a comment,
Mr. President, about what you said about the financial thing. So, we’re social entrepreneurs in this room
and we know that people’s behavior generally only shifts when you look at both
rewarding good behavior and, of course, clearly delineating
the downsides of bad behavior. And I think we are not talking
about the cost in the right way. What is being left by the wayside
by not leapfrogging in this area is massive. And it has to do with access
and it has to do with the cost of health, lost economic development, and lost participation from 40%
of the world’s population. And this quantification of data,
for me, is now essential because that is the play. GDP is the business case
for energy access in renewables and in decentralized communities,
rural communities, in ways that are low cost and highly efficient,
and leverage economic output. Question, anyone? I’ve got a question. China –
what can be learned from – China’s often talked about now
as the world’s green leader. How true is that if at all? You know, my view has always been, you cannot challenge,
you cannot address climate change or any world problem unless
you have transparency; unless you have human rights;
unless you have democracy; unless you have a pluralistic society. So yes, China seems to be
doing a lot of things and apparently it’s getting very rich,
and apparently, it’s very good, but I fail to see that. India would do it and of course,
India’s going to take time doing it because they’re going to have
more conversation in it, and when they finally
start doing it – and I think they’ll be
doing the right thing. Okay China,
suddenly the Chinese Premier tomorrow decides that
he’s going to ban everything. And they turned on their heel
because they weren’t a democracy. And I don’t necessarily think that these
are effective policies and options. You can suddenly change but this sudden changes in jolts
don’t necessarily give you a sustainable development path. China has historically done
this many, many times. It’s gone into many directions. And I’m not confident that it would
remain in that direction. I would again argue,
for instance in South Asia and India first in foreign policy. It’s not because
it’s a favor to India, but it’s because we want
Indian Ocean stability. So, is China going to be the leader?
? Is China going to save the world? Is China going to –
I don’t think so. -Dr. Saran?
-I think this is also something about what my colleague from New America
pointed out, that it is actually – this is the Trump effect. If China is going to be
the defender of climate and if China is going to be the last man
standing in terms of the global projects, then it says something
about the domestic politics of some of our countries
around the world. And I think that’s one conversation
that needs to be had; that where are we as people if the ethical,
moral, and global leadership is going to be devolving down to Beijing?
I think we need to ask ourselves that. But now let me also use his term,
let me make an economic argument. I think that China has understood
the economic play. China is making a big push
for the economic gains that will come from the green endeavors. So I have no doubt that they see this
as a huge growth potential. They have reduced the prices
of renewable energy projects. They have created smart building initiatives.
They have created new technologies that can make efficient utilization and consumption of urban lighting
and urban heating etcetera. And they’re players in the market,
so as a green capitalist economy China is doing certainly very well. It is sometimes outpacing
many of their cousins in Europe and America. And they now have the financial muscle
and they have their own world bank to fund development pathways
where the Chinese technology, the Chinese solutions can
then be exported to the world. So to that extent that they’re doing well
in the green market business, really they are doing well, but going green
is more than just stopping carbon. It’s also about allowing people
choice and agency. Like Megan mentioned here,
it’s also about.. I’m sorry, without governance
they’re doing the wrong projects, at the wrong place, at the wrong price,
to the wrong people. For instance, if you take a Chinese aid
to the Maldives, they’re excellent at building
bridges to nowhere. We can’t get that bridge from India, we can’t because they’ll ask us
ten thousand questions. And we would have to go
through it every day and it just finally would
become a nuisance. But that is the nuisance that you have to have,
to have sustainable growth. And look at South Asia,
look at all these airports, airstrips, harbors; they’ve done all sorts of things
in many, many places, but I do not know if these are
what is required in many, many countries. They’re building a bridge in the Maldives for,
I think, $300 million while that is going to, in my view, consolidate population
into two little islands while we have two thousand islands. So, I still would argue that without governance
you will get it wrong. Governments finally do their infrastructure
through a tender process and a transparent tender process. The procurement orders
of governments have to be written and the issue is, I have to write
it according to World Bank stencils and the UNDP stencils,
and other stencils. And these methods are obsolete.
So the tender document itself is where you go wrong. Now, you come to the tender document
from the legislative agenda. You come to the legislative agenda
from your pledges during the elections. You come to your pledges
from the manifesto. So again,
I think this is fairly simple; to saving the world is,
I don’t think, a big difficulty. It’s just: write the proper
procurement order. So we need a procurement order
for Planet B or to create a new –
to renovate the planet, to repair the planet,
we need a procurement order. So how do you write
that procurement order? So the finance of it
and the science of it, the economics of it. But what, at the end of the day,
governments need is a procurement order. And how you write
that procurement order depends if you would be
saving the planet or not. And you know, in this context,
I still believe that amongst the countries who are emerging
or developing at this particular time and some of the developed countries,
I think the U.S/India partnership is seminal. I think if the two of us can continue to do
what we did in the last four years, of the second term
of President Obama, which is, accelerate our green partnerships,
our green energy partnership and agree on trilateral cooperation,
which means India and America in different geographies,
for example, Africa. I think those kinds of relationships
will be important. Bringing in India and the U.S to work together
in countries in the emerging world would be crucial for seeding
both solutions and for a degree of credibility
and acceptability from the geographies where we
are wanting to create change. I think it’s an important relationship –
Europe, of course, is the third leg
of this new triangle which has to find energy
leapfrogging solutions. Hi, I’m Laurie Goering. I edit climate change news
for the Thompson Reuters Foundation. I’m really interested
by this discussion about how the renewables
are getting cheap enough, that the market should actually
solve this problem for us, right? -Yes.
-But there seem to be these roadblocks in the way that are political, that are financial,
that are just sort of inertia in systems. And I’m curious at what point
you see those breaking or what we can do to make
those break faster so that it happens in time to actually
deal with this problem at the speed that it needs
to be dealt with? Please do the manifesto. -The procurement order.
-The procurement order comes from this so we must make it. Das Kapital was around
for a long time and then Lenin came around and said
we could run a country according to this. We have the same knowledge with us, similar knowledge.
The science is there. Everything is there. Someone needs to come and say,
“Look, we could run a country based on this.” So someone needs to do
the procurement order, all the government tendering
based on this new thinking. So I think that’s when we would
start seeing financial flows. That’s when we would
actually start seeing a major impact
to saving the planet. I think I would respond by saying
that it’s already happened in many parts of the world. And Megan just made — she intervened
a while ago and she will tell you that in many parts of the world
the only idea of energy is solar energy. They have seen nothing before that
and they’re unlikely to see any major grid arrive
at their village any time soon, and they will have to rely on
the renewable for changing their lifeline existences and
lifestyle existences eventually. So it’s already happened, one. Second, I also think there is
a bogus argument being made that markets can do it alone.
That’s your point. I think there has to be a regulatory empathy
which allows this to be scaled up. The same empathy
that we offer to big conglomerates in the past who were exploiting
the sources under the earth. And I think that empathy is emerging
and I think the Paris Agreement demonstrates through a few initiatives that
now there seems to be a new mood to create that favorable
regulatory environment. And my last point would be the third point
I made this morning which was, we need to get
the bankers to sign up to this deal. The bankers have not signed
the Paris Agreement and I still believe that unless we can change the way big funds,
and big banks, and lazy money views the world and prioritizes climate action we will perhaps achieve
what we seek to do today, but it might fall short of what we really
need to be doing, which is much more. You know, by saying that I agree
to one and a half degrees temperature rise is by condemning Maldives already. Please understand,
when we say one and a half degrees I’ve, in an inhumane political way
agreed to killing 500 million people. I signed their death warrant.
Please understand what it means. We don’t understand this simple fact that every degree rise in
temperature kills people. For us, it is acceptable
to lose 700 million people because they’re largely
going to be those who anyways have a life expectancy
of less than 45 years because the bottom 20% of the global population
has a life expectancy of that length. So it doesn’t matter to us
because we will find high ground and we will agree to one and a half
to two and a half. We play these number games
because eventually it just means a few people who we don’t know,
who we can’t see on the map, say goodbye. We need heavy adaptation now. The deed is done. So the Maldives
and many low-lying countries must find more innovative
adaptation measures. And these adaptation measures
also must be new based on the new technology
and not based on steel and concrete. And again, I would argue that
that new technology is available. We’ve literally got two minutes or one minute. At the risk of being presumptuous to
answer the last question on Dr. Kammen’s behalf, I think he would have
talked about putting a price on carbon and the article he directed us all
to in preparation for this session pointed out that for the first time
in the United States you do have a bipartisan consensus on that
and a Republican group that’s put forward a plan for putting
a price on carbon. So I think he would have pointed
to that were he here. I would also say that
the private sector commitment that was made at Paris,
it’ll be interesting to see where that goes, to put a significant amount
of private wealth into energy R&D. And I believe it was called
the Breakthrough Coalition — it’ll be interesting to see
where that goes. I think that was a very hopeful
development because it doesn’t depend on the action of governments alone. In this last minute we’ve got
if you had a crystal ball, what’s going to happen now? How hot will the Earth get?
And despite greed, racism, a sort of backing away
from global political efforts, is economic pragmatism about bringing
clean tech being the future? Is that going to save us whatever
President Trump does and however — even though climate change isn’t even
mentioned in this country anymore as part of political discourse? -President?
-Mine would be yes, my view would be yes,
we are going to save the planet. I believe in human ingenuity
and I think all of us might not survive, but we would, even the Maldives
would find floating islands or genetically modified coral, or we would probably do
all sorts of things and survive. We’ve been in the middle of the Indian Ocean
for the last 20,000 years and we have a written history
that goes back 1,500 years. And I don’t want to prepare
ourselves to leave, so I would be looking
for ways and means to stay. And that would involve new technology.
That would involve a lot of new technology. So that would involve
the new procurement orders and so I think, I believe,
we could write these procurement orders. I’ve fought against odds many times.
I’ve been tortured twice. I’ve lost my twenties in prison. And I’ve been able to
come back many times. And again, I’m down and under and hope to come back.
And so I very strongly believe that the planet will survive and then we will have a better
future for the next generation. So I think we have set up
the regularity architecture and we have institutional strengths
in many big economies today to continue doing what we are doing
irrespective of big politics. But if we need to do more I think
political leadership is definitely needed; it’s missing today. I think there is a fatigue in those who
have traditionally taken responsibility for promoting and protecting
global commons and the common spaces. I think that leadership
needs to be reintegrated or else we are going to fall short. Now, I always argue
that we have not had our big moment on climate change
which can galvanize collective action. I mean, I always argue that
if you follow the money climate is not a big deal;
if you follow the money. For me, it is but if you follow
where the money is, you will realize that you don’t really prize carbon
as a really serious global issue. And I always give
the example of 2009, when at the G20,
twenty global leaders met in London, a few months before Paris —
sorry a few months before Copenhagen, and committed to
— everyone walked to the mic and said, “I’m putting $1.5 trillion of fiscal stimulus
to save the financial system.” “I’m putting $2 trillion.”
“I’m putting half a trillion.” “I’m putting $300 billion.” They were all alpha males
pumping their chest and spewing out $6 trillion
of commitments to save the financial ecosystem
and to respond to the financial crisis. Six months later 107 global leaders
gathered in Copenhagen and they did not have the courage
and the wherewithal to commit $100 billion
for the next eleven years. In 2009 they said —
they wanted to tell me, they told me, “Climate is $100 billion problem.” It is eleven years later.
I think it’s time to change the discourse. The collective action has to be more urgent,
it has to be more ambitious, it has to be larger, and unfortunately,
markets will not do that. Maybe President Trump may not either.
We need new leadership. Climate demands new leadership. I think we have some positive
individuals around the world, one of them sitting next to me,
but we need many more if we need to price
this problem right. I think carbon tax,
taxing carbon is one solution. I think we should be more ambitious;
let’s tax consumption. When you tax carbon
you are socializing the bad. When you tax consumption you are taxing the rich.
So let’s tax consumption. Let’s be much more ambitious in making sure
that we get the priority right. Thank you both. I found that
really fascinating. Thank you.

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