Copenhagen Climate Summit: The Missing Billions
During this week and next, I and then Rishabh Kaul will be at the U.N. climate summit in Copenhagen that is intended to launch a successor to the Kyoto Protocol, and we hope to cover any relevant news and events. (That’s COP 15, or the 15th Conference of the Parties to the UN Framework Convention on Climate Change, for those of who you like UN acronyms)
This should be a huge job because the success or failure of mitigating and adapting to climate change will impact agriculture, health, water, sanitation, migration, urbanization, and more. And through the Clean Development Mechanism of the Kyoto Protocol, carbon finance could potentially move millions of dollars from the largest corporations in the world (looking to purchase carbon credits under a cap and trade scheme) to some of the poorest communities in the world (producing carbon credits through low-carbon development) – financing energy, cooking, and land use approaches that prevent the growth of carbon emissions. Companies like D.Light and investors like E+Co are already taking advantage of this.
But although they are often discussed here as the first and worst victims of climate change, the base of the pyramid is, at first glance, invisible in the negotiations in the shape of solutions to climate change. Except in the context of avoiding tropical deforestation, carbon finance relevant to the base of the pyramid is at best a niche conversation. If intensive energy use and land development equal carbon emissions, the base of the pyramid would by definition not appear to be terribly relevant.
This means I have less to blog about except for maybe some side events, but plenty to say. I would argue that there’s is a huge amount wrong with the orientation of these negotiations and the fact that the base of the pyramid is absent gets to the heart of the issue. In a vicious cycle, the weakening of the negotiations will lead to failure in their intended impact, simply hurting the poor even more.
The G77 bloc is angling to increase the $10 billion in annual aid that developed nations are promising to provide in funding for climate change adaptation and mitigation. But it seems likely that there will be plenty of double-counting of that aid money and it’s not enough to begin with to address either mitigation (i.e. low-carbon development) or adaptation. And it’s unclear what this will go towards, who will manage it, what it will truly be intended to do.
As they have in previous years, the negotiations pit the world’s wealthiest 1 billion people against the 3-4 billion who have gained a some level of prosperity and are rising quickly. Who will cut back on carbon – those who already emit a lot, or those who are emitting some and want to emit more in the future? With the negotiations set up like this, it quickly becomes a zero-sum game. Since the UN process relies on the commitment of the nations that constitute it, as a zero-sum game it becomes useless as a force to raise the bar towards clean and sustainable development.
Left out of this picture are the 2-3 billion people who are essentially not using modern energy – at best a little bit of electricity from an unreliable grid, a little bit of kerosene for lighting, diesel to operate machinery or transport, and maybe charcoal or LPG for cooking. But likely using firewood or other biomass for cooking and as likely as not having no access to electricity at all.
These are the people this blog concerns itself with. It seems counterintuitive that those who use the least energy currently are critical to an international agreement on reshaping our energy industries and ending deforestation as quickly as possible. But I believe they actually lie at the heart of any global deal to address climate change.
Where does this third of humanity actually show up in the negotiations?
They are the anonymous presence assumed to be within the growth curves in projected energy demand in Asia and Africa. They imbue these growth curves with moral force because basic services, health care, education and more must reach these billions in the decades that are in question in the negotiations.
These growth curves of energy demand in Asia, and to a lesser extent Africa, are the mountains that the negotiators must climb to reach an agreement. It is assumed that this demand will be met with fossil energy unless otherwise subsidized, by the West or at the expense of the poor. And these curves are steep.
They would probably be insurmountable except for a few things.
The biggest thing that the developed nations could do to flip this zero-sum mentality and unstick climate negotiations would be to act like they truly cared about access to energy in the developing world – particularly for those whose lack of access is most severe.
Most of the growth in energy demand in Asia and Africa will come from industry but the moral imperative of that growth comes from the people who are in energy poverty and need to get out of it. Yet this is a relatively small amount of energy demand – it is not the first kilowatt of electricity demand by households at the base of the pyramid that is going to push us beyond the safe levels of carbon in the atmosphere.
The truth is that it is quite likely that even with no climate treaty at all limiting carbon-intensive development, very few of the 1.6 billion people who are off the grid right now would get on the grid any time soon. From India to South Africa, electricity grids are going into blackouts straining to provide power to industrial customers, let alone people without access to electricity. When oil prices rise, try as they might by cutting other services and going into debt, developing country governments will not be able to subsidize fuels indefinitely. There is no imminent or clear path, under current patterns of fossil fuel and power sector development, for those living in energy poverty to smoothly emerge from this.
If the Copenhagen summit prioritized access to electricity and efficient, low-carbon cooking and heating to the 2-3 billion people it is currently ignoring, it would be a very different summit. Both developed and developing countries would be united in confronting the dual moral imperatives of addressing climate and development, rather than appearing to pit one against the other.
And the reality is that providing modern energy to these 2-3 billion people could be done with clean energy about as quickly as could be done with dirty energy – over the next 20 years – for about the same price or perhaps a minor subsidy from developed countries. Solar lighting and similar renewables are now basically at price parity with kerosene and diesel generators, and the variety of price-competitive renewables, such as small wind turbines, will only increase in coming years. The businesses that Next Billion covers regularly are demonstrating that these technologies can be commercially deployed. With greater investment and prioritization by the global community, they could start replicating, franchising and scaling dramatically.
This would not only be a development success, but a climate success, because three billion people cooking and heating with fuelwood and biomass is a significant contributor to climate change. There could be a billion households that don’t need to transition off of fossil fuels because their first electricity comes from solar.
Addressing the pockets – gaping holes really – of the deepest energy poverty would not only shave down the projected energy demand from fossil fuels. It would make negotiating between the wealthiest 1 billion and the 3-4 middle billion a more surmountable task. Not easy – but much more straightforward, dealing with a set of maybe fifteen major industrial economies that need to be brought into parity on carbon in the coming decades. In doing so they will create the utility-scale clean energy technology that can be deployed globally.
One of the key insights behind market-oriented development at the base of the pyramid is recognizing that there is a not a “First World” with one set of economic rules and a “Third World” with a different set. An extrapolation of this is seeing the world in terms of economic gradations rather than borders – there are “Third World” economic conditions in the poorest parts of the U.S. and “First World” conditions in Rio, Mumbai, and Shanghai. Seeing the gradation of needs that exist between the wealthy, the emerging middle classes, and the global poor in these climate negotiations would help move them beyond the impasse they have currently reached.