Category Archives: Social and Economic Systems

Why Russia Should Invest in Sustainability

Seven Reasons why Russia Should Invest in Sustainability — Three of Them Unconvincing

by Alan AtKisson

CEO, AtKisson Inc. & Author, The Sustainability Transformation

On Wednesday, 10 February, I made the second keynote presentation (after Ashok Khosla’s opening) to a conference in Moscow called “Innovative Russia: Responding to Global Challenges.” The other participants on the 11-person panel were a small who’s who of combined Russian and Silicon Valley leadership. You can view the program here:  http://gvacapital.com/ir.  Moderator Yermolai Solzhenitsyn’s affiliation is not listed there, but he’s the managing partner for McKinsey in Moscow. The photograph was taken from the stage, with my iPhone, during Ashok Khosla’s speech.

Response to the speech was positive enough that I turned it into an article text, published below, which will also be translated and published by the Russian on-line magazine gazeta.ru. Since my books were recently published in Russian translation, I also managed to slip in — during a final comment, about how venture capitalists could at least try to put some sustainability content into their investment decisions, instead of making money on anything at all and then giving some of their wealth to charity — a note of gratitude to Natalia Tarasova, a professor at Mendeleev University and good friend. She had overseen the translation.

Why “Seven Reasons”? Because Muscovites love the number seven. And why are “Three of them Unconvincing”? Read, and you’ll see …

These are exciting times in sustainability. In practice, sustainability involves reinventing business and governance processes so that they stop destroying key ecosystems, depleting irreplaceable resources, and increasing the gap between rich and poor. “Practice” is exactly what has been missing from sustainability work for most of the concept’s lifetime. But recently, sustainability has moved out of the category “something that academics, bureaucrats, and activists talk about” to the category “something that mainstream business leaders and investors do something about.” This is a monumental shift that has been gestating for some time, if you knew where to look. But it really began showing evidence of its exponential growth rates only in the past three to five years. Now, the evidence is overwhelming:

  • Countries like South Korea and China have embraced the concept of “Green Economy” or “Cyclic Economy” with serious policy initiatives and billions of dollars of investment
  • Global companies like Unilever or Siemens (and dozens of others) have set goals that combine ambitious revenue growth with strong reductions in environmental impact, impressive increases in corporate responsibility practice, and serious commitments to “sustainability innovation”
  • Global consulting and auditing giants such as Ernst & Young have been hiring hundreds of people to support new, growing divisions with titles like “Climate Change and Sustainability Services”
  • Investment in renewable energy grabs headlines every week, such as the recent deal between United Arab Emirates and Spain to invest USD 5 billion in Spanish solar technology
  • Oil and gas economic powerhouses such as Norway are redirecting more and more of their windfall fossil-fuel-generated capital into cleaner and more sustainable solutions (Norway recently pledged to increase its domestic renewable energy use to 67.5% of total by 2020, which translates to an increase of 9% every year in wind, hydro, solar and other sources)

These items are already commercial facts, but more visionary innovations and mega-projects are also taking shape in the world’s think-tanks and testing grounds. From South Korea’s large-scale tidal energy installations, to the bio-mimicry technologies erupting from the minds of biologists working in collaboration with engineers, to the giant-but-increasingly-realistic proposals such as “DESERTEC” (generating solar electricity in the Sahara) or mega-grids (e.g. linking up East Asia with a vast complex of underground, highly efficient mag-lev trains and supercables) … it is no wonder that anyone just waking up to this transformative revolution in humanity’s planetary management strategy might find it all a bit dizzying.

Of course, up to now, humanity had no “planetary management strategy” — and this was precisely the problem. Our activities, super-amplified through the power of cheap energy and technology, had become planetary in scale, but disruptive (and largely destructive) of the planet’s billion-year-old natural processes. And indeed, for decades, it was largely academics and citizen activists (plus a relative handful of visionary leaders in business, the United Nations, local government, and other arenas) who worried the most about what was happening, and tried to do something about it.

That “something” that these early leaders were trying to “do” was to change government policies, business practices, consumer attitudes, educational curricula, and other elements of our increasingly inter-connected global system. The request was actually simple:  Add sustainability to these things. Add systems thinking. Add a longer-term, more holistic perspective to the definition of “success.”

For many years, these efforts to change thinking (and practice, and policy, and investment) did not seem to be working, or at least not working fast enough, and certainly not working at anything like the right scale. But such is the magic of exponential growth:  what appear first as insignificantly small, incremental changes are in fact replication and multiplication processes. They grow by doubling. Things appear to go faster and faster, and at a certain point, things take off. Think cell phones, Internet, Total Quality Management. Few people remember that seeking to perfect quality, as a manufacturing practice, was still a new idea a few decades ago. The idea’s original proponents could barely get noticed by business leaders. But then the Total Quality Management movement started (in Japan), it grew exponentially, it took off … and by one decade ago, “Quality Management” was such a normal, mainstream concept that everyone stopped thinking about it.

That’s what’s happening in sustainability:  take-off. Sure, there are ups and downs even in the midst of take-off, which is exactly what you would expect in a maturing market of any kind. But the overall pattern in unmistakable. Wherever you look on the map of the world, from the renewable energy fields of Brazil, to the environmental accounting practices of shoe-maker Puma, to the spread of clean cooking stove technology to the smoked-out kitchens of the developing world, you can see transformative change accelerating before your very eyes.

But not in Russia.

Why is Russia missing from the emerging map of transformation to a greener and more sustainable economy? With its enormous amounts of money, resources, and brainpower, it could be leading the way, as several other oil and gas-based economies are doing. But analysts far more well-informed than myself — including Russia’s own leadership — have long noted with worry that Russia’s surging economy is almost entirely based on the export of raw resources. The country’s rising prosperity floats on that sea of oil and gas, as a few Google clicks (engineered partly by Sergey Brin’s Russian brainpower) will easily tell you. Easy wealth breeds indifference, and Russian innovators tend to take their inventiveness elsewhere, to places like Silicon Valley, resulting in a drain of capital, both financial and intellectual, from the country.

This situation could easily be reversed. I use the word “easily” in an entirely theoretical sense:  in practice, nothing is easy in Russia, as any Russian is quick to tell you. The entire nation seems to take pride in its enormous capacity for problems and difficulties — and by extension, its capacity for overcoming them. Nonetheless, in theory, Russia could change relatively quickly from being a sustainability laggard to a serious leader, especially in areas related to technology and large-scale industrial implementation.

What follows are seven reasons why Russian leaders in government and business — including that class of wealthy and powerful people known universally as the “Oligarchs,” together with the people who advise them — should take the opportunity for investing in sustainability far more seriously than they currently do. While all seven reasons are convincing to me, I am quite certain that the first three will not be convincing to anyone in a position of power in Russia. For that reason, I have clearly labeled these first three as “Unconvincing Reasons.”

But that leaves four reasons that seem to have the potential for unlocking a torrent of creativity, investment, and change in the way Russia pursues its economic destiny. Because many Russian economic leaders started their professional lives as physicists and scientists, I will use — starting from Reason #4 — the concept of Potential Energy as a metaphor for what I, as an outsider, see as possible in Russia. A small shift in thinking could result in large shifts in the real world, resulting in multiple benefits, not just for Russians, but for the world as a whole.

UNCONVINCING REASON #1:  THREATS TO NATIONAL SECURITY

Many sustainability issues have a national security dimension. If you are sitting on resources that others desperately need but don’t have — like oil, or water — you may find soldiers at your doorstep. UN diplomats quietly pointed to climate change and precipitation declines as underlying causes for the forced migrations and slaughters of Darfur. Australia has concerns about what happens on its Northern shorelines if refugees flee swamped coastlines or other disruptions. The US Department of Defense runs scenario exercises based on climate change, conflicts over resources, and other sustainability worries, and is moving aggressively into biofuels and solar energy to insulate defense operations from the vagaries of a global energy market. One would think that arguments like these would be compelling to anyone in the leadership of a nation with a permanent seat on the UN Security Council.

But Russia is vast. It has resources that it perceives, rightly or wrongly, to be virtually endless. It has an extremely strong defense (which, according to recent news reports, is slated to get even more budget support in coming years). No one in Russia worries seriously about hungry Finns or Latvians storming across the border, or even Chinese troops for that matter. No one worries about where the fuel to run tanks and warships and fighter jets will come from. Despite the echoes of Cold War saber-rattling in recent Russia-NATO exchanges, nobody worries about missiles falling on Moscow anymore. National security is truly not an issue for Russia. Arguing for sustainability “for the sake of national security” would generate nothing more than an ironic chuckle, so let’s cross that off the list.

UNCONVINCING REASON #2:  BREACHING THE PLANETARY BOUNDARIES

In a landmark article published in September 2009 in the journal Nature, an eminent international group of scientists concluded that humanity’s activities had already pushed several global ecosystems (climate, biodiversity, the nutrient cycle) over the limit of what those systems could tolerate. Other systems were heading quickly over the same precipice. The long-term consequences would be “detrimental or even catastrophic for large parts of the world” — strong language that reflects the seriousness with which they viewed the available data. They called for concerted action to bring humanities use of resources and emissions of waste back into the “safe zone” of what the planet can sustain. Their arguments were so compelling that political leaders have been sitting up and taking notice, including the United Nations High-Level Panel on Global Sustainability, which is chaired by two presidents.

But once again:  Russia is vast.  Even if the worst-case scenarios associated with these trends come to pass, the typical Russian leader is likely to think, “So what?” If water dries up in one place, we’ll shift agriculture to another. Too hot and dry in the south? Too much nitrogen in the water table? Too much climate change? We’ll just grow wheat in balmy Siberia. The rest of the world may have serious troubles, but Russia feels insulated by its size, geographic diversity, and resource wealth. Cross Reason #2 of the list as well.

UNCONVINCING REASON #3:  THE NEED TO “SAVE THE WORLD” FROM CATASTROPHE

A generation of sustainability champions (including myself) were inspired to act by the analyses contained first in a little book called The Limits to Growth, published in 1972 and updated twice, the last time in 2004. The original worries presented in Limits — that the exponential growth of population, resources, and pollution would eventually bump up against the boundaries of the planet (see Reason #2) — have been supplemented in recent years by the notion that there could be “tipping points” in the global system. Resource depletion, ecosystem disturbance, and other activities may seem “sustainable” for a while, but when they can cross an invisible line in the sand, they suddenly collapse like a house of cards, taking innumerable species (and humans) with them. An example might be the Amazon:  at what point does the number of trees lose critical mass and trigger a sudden shift from Rainforest to dry savannah? Unfortunately, such nightmare scenarios are the stuff of current serious scientific analysis.

When people use the phrase “save the world” in the context of sustainability, usually with a kind self-mocking (or just plain mocking) undertone, what they often mean is the effort to stop destructive processes before it is simply too late to prevent some sort of resulting catastrophe. People are emboldened in this work by remembering that, on several occasions, humans actually have saved the world, or at least important parts of it. The most famous example is the threat to the ozone layer caused by the production of CFCs:  production of this insidiously dangerous chemical was dramatically reduced, essentially just in time to prevent the loss of the planet’s one and only atmospheric shield against dangerous ultraviolet radiation. Even the phrase “Save the Whales!” from the 1970s can be celebrated now as a kind of world-saving triumph, at least for several whale species, which have bounced back from the brink of near-certain extinction.

But is “saving the world” a compelling reason for Russia to invest more seriously in the sustainability transformation? Hardly. Russia will be fine. See above: even in a truly worst-case scenario, Russia would adapt and survive, as it always has. (Remember that Russian affinity for surviving serious and complicated problems.) And as for saving the world for its own sake, well … what has the world done for Russia lately? Scratch Reason #3.

If you question my characterizations above, consider the data. While reading through the excellent English-language summaries provided by the organizers of the recent Russia 2012 Forum — an event that happens right after Davos, and manages to entice many of the global Davos stars to stop in Moscow on their way home — I came upon this wonderful tidbit at the end of a slide presentation on Russian attitudes to risk management in the financial markets. As the last item in an otherwise dull review of what Russian investors think about hedge funds, participants were asked, “Do you believe the world will end any time soon?”  “Yes,” said 4.3% of respondents. “No,” said 45.6%. But the majority response, 50.1%, was this:  “I don’t care, I’m hedged.”

Having dispensed with the unconvincing reasons for why Russia should invest in sustainability, let’s turn to the potentially convincing ones, and to that wonderful and relevant concept from basic physics:  Potential Energy.

REASON #4:  CAPTURING AN EXTRAORDINARY ONE-TIME FINANCIAL OPPORTUNITY

According to published analyses, there is a lot of money in Russia currently trapped in its antiquated buildings, equipment, and infrastructure. It is trapped there partly by energy price subsidies, but it is also trapped by a simple lack of attention and focus. There may be more exciting things to do on a Friday night in Moscow than improving the energy efficiency of buildings and machines; however, there are few things that are potentially more profitable in the long term.

The key word here is “potential.” An apple hanging by its stem has what physicists call “potential energy.” Break the stem — or better yet, if the stem is gripped between your two fingers, simply open your hand — and the potential energy is converted to kinetic energy, the energy of motion. The apple falls.

According to a report by McKinsey & Co. published in 2009 (“Pathways to an energy and carbon efficient Russia”), there are many such apples in the Russian economy. Relatively simple incentives and decisions, the equivalent of simply letting the apples fall, could create a very respectable flow of money, even in a country used to the torrential flows of petro-rubles. Consider the following:

  • An initial investment of €70 billion to upgrade buildings and construction would result in savings of €190 billion over a twenty-year period. This is equivalent to a 120% return on investment.
  • When it comes to producing heat and energy, a €20 billion investment produces €60 billion in savings over the same period, a whopping 200% ROI.

In fact, says McKinsey, “Russia has the largest relative potential among all the BRIC countries to reduce [CO2] emissions through implementing only measures that are economically attractive” [emphasis added]. While the savings in CO2 may not be a compelling motivator for Russia’s economic leadership, the potential for solid returns on investment should be — not to mention the jobs that could be created in order to do the work, and the pleasure of owning shiny new (or renovated) buildings and machines.

The benefits include health and safety: Russia’s own Geographical society reported last year (March 2011) that “we have fundamentally obsolete production facilities and communal infrastructures, which is [a recipe for] a major disaster.” Fully 60-80% of Russia’s energy infrastructure is estimated to be in need of maintenance and repair, and those repairs could be combined with efficiency upgrades. Around 90% of industrial waste is not recycled back into production: waste is going to waste, when it could be generating more economic value. These figures represent a great deal of financial potential energy that could be released by the right combination of incentives, policies, and forward-looking investors.

What is that combination, exactly? These are the kinds of big, complicated problems that Russians ought to love, because solving them could make some people quite wealthy. The potential exists not only in renovating the existing infrastructure, but in the new things that must be built just to meet projected demand. Over 60% of the infrastructure to provide Russia’s expected energy needs in 2030 has yet to be built. What choices will Russia make about how to build it? Wasteful ones? Or long-term profitable and sustainable ones?

In fact, it is entirely possible that the estimates of McKinsey and others may be conservative. For example, the rise of “passive house” technologies in Europe in recent years has produced many examples of extraordinary cost savings (which is another way of saying, extraordinary profit). A typical Soviet-era apartment complex in, say, the Czech Republic can now be rebuilt to save 90% of its previous energy consumption, while creating brighter and more attractive living environments. No one really knows what would happen if innovations such as these were serious deployed throughout the Russian economy, because no one has tried.

The apple is still clenched firmly in the hand.

REASON #5: THE COMPETITION FOR ECONOMIC AND GEO-POLITICAL POSITION

Like it or not, Russia is in competition for power and influence on the world stage. At the moment, the nation’s vast fossil fuel and other resource reserves are the primary platform on which it stands. But this powerful platform will not last forever, and its lifespan may be shorter than many believe.

The global energy market is changing with extreme rapidity. Many countries are embracing new (and environmentally controversial) methods of extracting oil and gas explicitly to reduce their dependence on the global market … and by implication, their dependence on Russia. Other nations, such as China and South Korea, are taking what might be called “hard positions” in sustainability and green economic innovation, partly as a way of increasing their “soft power”:  South Korea has been rewarded for the billions it invests in “Green Growth” with an enhanced profile as a forward-thinking technology leader envied by many. Meanwhile, the financial crisis continues to depress demand, and if high unemployment persists or deepens, the word “depression” may creep back into the global economic lexicon. Experts speculate openly about what will happen if these trends combine to create a “perfect storm” — from the Russian economic perspective — of dramatic drops in the price of oil and gas. The picture they paint is not rosy.

The reality of today’s energy market, as well as the future of how that market will develop, are both devilishly complicated. Some say “peak oil” will drive prices sky-high; others say depressed demand and diversification will send prices plummeting. Predicting the future is impossible. But that simply underscores the very real possibility that Russia may not have more than a decade left to enjoy its extraordinary fossil fuel capital windfall. If the petro-ruble river starts to run dry, what will Russia have to show for all its years of easy money? As more nations “frack” their own gas, install windmills and solar cells, super-insulate their houses, and start driving their cars on electricity generated off their own roof-tops, what will they buy from Russia? What will Russians buy from each other?

Investments in sustainability of the kinds described above — not just in the low-hanging fruit in Reason #4, but also in the more visionary directions described earlier, including the emerging fields of biomimicry, green chemistry, and sustainability-oriented nano-, bio-, and info-technology — would accelerate the kind of economic transition that everyone says Russia needs. Russia has the chance to transform itself from pipeline-and-oil-barrel hulk to a focus of technical and economic admiration, while renewing its economy on back of a much more diverse and robust industrial portfolio. Granted, the world’s hunger for oil and gas is not going to disappear any time soon; but the world’s hunger for sustainability-oriented innovation, and its respect for those who seriously invest in it, is growing exponentially. This has created a serious global race in which Russia is not currently competing.

And you have to be in it, to win it.

REASON #6: IMPROVED QUALITY OF LIFE FOR THE RUSSIAN PEOPLE

In a recent issue of Science journal, an international team of 24 researchers documented the benefits in every country, worldwide, of reducing tropospheric ozone and black soot. In brief, by taking action to improve a menu of 14 wasteful and pollution-generating industrial activities — of which all but one apply strongly to Russia — health will improve, food production will increase, and millions of premature deaths would be avoided (an estimated 40,000 of them in Russia). The cost? Negative. The whole exercise would generate net positive income by reducing healthcare expenditures and increasing agricultural output. The fact that these actions would also help reduce the impact of climate change is just a bonus (“Simultaneously Mitigating Near-Term Climate Change and Improving Human Health and Food Security,” 13 January 2012).

This is just the most recent in a long line of research papers, case studies, and living-proof models showing that “going green” is good for people as well as the planet. In buildings renovated to be sustainable and efficient, fewer people get sick and employee retention rates improve. If you make city streets or even parking lots more beautiful and pedestrian-friendly, people will walk more instead of driving their cars round and round looking for a parking spot that is 50 meters closer to the door.

Sustainability innovations of these kinds do not just save lives, make money, and stimulate economic development: they make people happy. They create optimism. They can help point whole societies squarely toward the future, and generate a feeling of hope.

What Russian leader, in government or in business, would not want this for the Russian people?

Which brings us to the seventh, and most compelling reason for why Russia should invest seriously in sustainability.

REASON #7:  BECAUSE YOU CAN

Russia, compared to most other countries on Earth, is in a privileged starting position when it comes to investing in sustainability. It has ample financial and intellectual capital to invest — much of which is leaving the country, at the moment, but that is a flow that could be reversed. It has surplus resources to such an extent that the word SURPLUS should be written in large letters. It has a relatively unchallenged position of national security, and no need to project power globally (because, among other reasons, it has all the resources it needs). It has a deep heritage of leadership in science and technology on which to draw. And it has plenty of low-hanging, money-making fruits to pick from its economic tree.

More importantly, Russia’s strengths give it the resilience needed to take some risks and absorb some losses — for as any entrepreneur will tell you, one has to be ready to take a loss once in a while, in order to accomplish a big win. Changing national economic habits, technologies, and infrastructures is going to require a lot of focused thought, domestic reform, strong incentives (e.g. to reverse human and financial capital outflows), and occasionally nerves of steel. Russia needs to find its niche on the global sustainability stage and, for its own sake, to do it quickly. As noted earlier, the theory is easy and straightforward. The practice will be challenging.

But Russians are a tough people. They like challenges, and they don’t like to lose. There is a great deal to be won by investing seriously in sustainability and economic transformation. Russia certainly should do this, if only because — in ways that truly are unique to this country — Russia can.

How I Created (Not) a UN Campaign

This article is about how I became obsessed with trying to create, or catalyze into being, an international campaign to dramatically increase renewable energy investment in the developing world — and why I now feel ready to let go of that obsession. The short version is this:  The campaign is happening, and the UN is doing it.

I have a hard time letting go of my ideas for initiatives, once they are hatched. And the UN campaign is not exactly what I imagined for the initiative we were calling “Big Push.” But it’s certainly close enough for me to say, okay, this is one project I can take off my plate. Here’s the link:

http://sustainableenergyforall.org

This campaign is about as high level as such a thing can get. The initiative comes straight from the Secretary-General’s office. The campaign was created by an act of the UN General Assembly, which has declared 2012 “The Year of Sustainable Energy for All.” (See Resolution 65/151)

What did I have to do with all this? Not much. But anyone who has been watching this space will recall the work I did in 2009 for UNDESA’s Division for Sustainable Development. The vision for the Big Push was not mine (it was Tariq Banuri’s, former director of DSD) nor were most of the ideas and analyses that went into it (I was building on the work of many people, inside and outside the UN, and especially the World Economic and Social Survey 2009). My job was to help assemble a coherent strategy document to take to the Copenhagen CoP-15 climate summit, in December 2009. Working with a number of colleagues, we pieced together something that I still think of as being beautiful and elegant in design:  a high-leverage, large-scale program for spreading renewables quickly in the world’s poor countries, with the effect of improving people’s lives, while also accelerating the renewables market in the rich countries and speeding the transition to a renewable energy future.

The “Big Push” strategy paper was well-received:  we quickly won the endorsement of many leading climate/energy researchers, plus WWF International and other NGOs. You can download that strategy document by clicking here.

Copenhagen did not work out as anyone hoped, of course, and the strategy paper just lay there for awhile. But I could not let it go. The vision and ideas may have originated from others (the “Innovators” in this specific case), but in classic “Change Agent” fashion, I had become thoroughly convinced that this was an idea that had to happen, if we were to achieve the transformation to a sustainable world in reasonable time.

So I began to make some noise about creating an independent, international “Big Push Campaign,” outside the UN system. I talked to friends in leadership positions, recruited the excellent help of an astrophysicist-turned-energy-researcher at Harvard (Achim Tappe, thank you!), networked with other experts, and even had the marvelous opportunity to present the Big Push concept as an opening speech to this year’s World Renewable Energy Congress (Anders Wijkman, thank you!). You can access the text of my speech to the Congress by clicking here.

At the heart of the original strategy is the idea of spreading, and globally subsidizing, the pricing mechanism called a “Feed-in Tariff,” or “FiT”. This involves guaranteeing that if you build a renewable energy installation, you can sell the resulting electricity to the grid, at a subsidized price. The mechanism works incredibly well, and has driven the explosion of wind and solar development in Denmark, Germany, Spain and other countries. New countries keep adding it (Japan just did), but others are also drawing in the brakes (as the UK just did), because it works too well (think some people).

There were many other technical, policy, and outreach aspects to this plan, which you can read about in the original paper, and in the more advanced technical ones that followed, such as Deutsche Bank’s studies for the Secretary-General’s advisory group 2010 and 2011, focusing on how to create a global “FiT” mechanism while managing the risks etc. How did all of this, and many other streams of activity, work together to become the new UN Sustainable Energy for All initiative? To be honest, I really have no idea; I moved on to other projects at the UN (like this one), and no longer have a direct window into that process. Did my work in 2009 have any impact in 2010 and 2011? I’d like to think so — I know UNDESA really spread that paper around, both inside the UN system and outside — but I really don’t know, one way or the other. That’s the consulting life:  you engage with a system, you do something, the system changes … and you never really know if those changes happened (even just in part, even just a tiny little bit) because you engaged with the system … or if the system would have changed anyway, with or without you. Understanding this basic truth keeps one feeling very humble about consulting work, even when it feels “important”. Perhaps especially then.

The most important question, however, is certainly not whether my work had any impact. Not even the technical side of renewable energy scale-up is much of a question at this point:  it’s well established now that the technologies work, the policy mechanisms work, the market works. There are exciting breakthroughs on sustainable energy happening, and being reported, nearly every day. (My current favorite is this one:  indoor solar lighting using only a plastic bottle, water, and a piece of tin or aluminum. It’s spreading like wildfire in the Philippines, where it was invented. Check it out on this short BBC video.)

The really big question is, will these strategies actually work? What clearly isn’t working yet is marshaling the political will to actually transform the global energy system, as the UK government’s recent pull-back on their highly successful FiT program illustrates all too dismally. What isn’t working yet is the serious mobilization of capital, at the scale we really need, and in the right direction. What isn’t working yet is the removal of fossil fuel subsidies that push the whole planet in the wrong direction, while helping the world’s richest energy companies get richer. Etc. etc. etc. There is certainly a lot to do … and there are a lot of powerful interests at play.

So at this point, it no longer makes much sense for me to try to recruit others into a new and separate global campaign, as one among a dozen projects on my plate. Instead, I’ve started putting my shoulder to the wheel of the UN’s Sustainable Energy for All initiative, promoting it through every channel I have access to. It’s not enough, as we all know, even to have a UN General Assembly resolution and the UN Secretary-General pushing an agenda like this.

It’s going to take a Big Push from all of us.

A Week in Super-Fast Green-Growth South Korea

My first visit to South Korea introduced me to a remarkable country. Everyone I met, from the taxi driver to government officials, was unfailingly kind and courteous. I came away very impressed, on many levels. But the trip certainly started out in an interesting way …

South Korea is in a hurry. I felt this first-hand. It started with a car accident.

When riding in a taxi in a new country, especially when I notice that the drivers of vehicles on the superhighways seem a little on the cavalier side, I have often found it a good policy to sit in the back, put on my seatbelt (like a good Swede), and get my computer out. Best not to look at the actual driving.

For that reason, I really don’t know why my taxi ended up plowed into the side wall of the tunnel after smashing into the car ahead of us and sending another car into a spin. I was shaken up, but fine. I was still holding my computer, and I calmly saved my work, closed it, and got out of the smoke-filled car. The driver, whose air bag had deployed and saved his face, was saying something to me in Korean. I assumed it to be “Are you okay? Get out of the car!” and so I did that.

I sat up on the wall inside this tunnel and marveled at how most cars, in such a situation, just try to figure out how to get by and keep going — even though there was a car in the middle of the middle lane, facing the opposite direction, which seemed to me a clear signal that something was amiss.

There are many additional colorful details to this story, such as the ride in the tow truck or the sign language conversation with Korean police. But given that I was unhurt, and unable to tell anyone anything about what had actually happened, someone simply called a new taxi for me and I continued on to my meeting at South Korea’s Government Complex.

Since I had left early — to allow for trouble, which I certainly did experience — I ended up arriving exactly on time.

After the day of meetings (which were pleasant and productive), I was in no mood to take another taxi, so I rode the excellent subway system, two hours, changing four times, to get from south Seoul to Incheon. What landscape I saw was essentially the same everywhere: urban Asia. Small manufacturing operations. Shopping opportunities. Dense dwellings. The occasional hilly area (this is Korea after all), and some lovely parkland (Koreans appear to greatly appreciate parks).

The trains in Korea run so smoothly that most people who are standing do not even bother to hold on to anything. They just stand there. Many of the passengers were engrossed with their smart phones. Whenever I could sit, I pulled out my laptop and worked.

Back in Incheon, I got off the train a few stations early in order to walk home to the Sheraton Incheon hotel and get some exercise. The station guard who helped me get oriented was amazed that I was going to walk. The distance seemed to him improbably far. I knew it to be about 25 minutes, through another pleasant park, in the cool evening.

Incheon is a huge metroplex, very diverse and spread out, southwest of Seoul. Part of the city is old and historic, the site of Western culture’s main interface with the Korean culture in centuries past. Part is brand, spanking new, and has been built on land reclaimed from the sea in just the last few years.

In these newer parts of Incheon, one almost feels a sense of vertigo at the pace of growth. In just a few short years, tidal flats and low waters have been turned into “Tomorrow City” (the name of just one of the many futuristic building complexes) and many other tomorrow-ish things. The designers of these new parts have certainly been informed by “green”/sustainable ideas. My hotel is the only LEED-certified hotel in Korea. Across the street is “Central Park,” whose name, strategic location, and size are a clear reference to Manhattan’s Central Park. Incheon’s ambitions are similarly New York-ish: Korea’s tallest skyscraper was just finishing construction next to the hotel. And some of the nearby buildings look like support structures to the inter-planetary transportation device that is featured in the Jodie Foster movie about humanity’s first communication with people on other planets (“Contact”).

For this reason, the enormous Christian Bible exhibition (see photo), which occupied a huge portion of Central Park, and which had been partially destroyed by a typhoon and left in shambles for months, seemed all the more surreal. From my hotel window on the 14th floor, I looked out over Moses parting the red sea, a life-size replica of Jonah and the whale, a full-size (and that means enormous) model of Noah’s Ark, and dozens more. Everything was in bright colors. Everything was frayed; some things (such as a huge temple made entirely of porcelain plates) were partially, even dangerously, collapsed. A literal “stairway to heaven” invited one to climb up a winding road into the air, with no guardrails and certainly no certainty that one would return: in fact, if one did try to climb it, one would certainly end up falling to one’s heavenly doom (or perhaps, for the non-believers, doom of a more fiery kind).

Otherwise Incheon, or the part of it where I was living, was full of coffee shops and quick-marts, branded restaurants and high-rise luxury apartments. The roads appeared to be 12 lanes across, but there were never more than two lanes of traffic: Incheon is planning, Incheon is built, for future growth.

How much of that growth is green? S. Korea is, after all, the leading country in the world in terms of “Green Growth,” the policy of directing public investment into low-carbon technologies. Incheon city officials promised to send me some of the technical specs on what is happening there, which I look forward to reviewing, with keen interest. Meanwhile, I found this fascinating article in the journal “Environment” which details a recent set of scientific debates and political conflicts between conflicting “green” goals in the Incheon area. An enormous tidal energy plant, for example, would be “low-carbon,” but would come at the cost of the tidal flats that serve as rich breeding grounds for marine biodiversity.

It is impossible to assess, from a first visit, what is actually happening in Incheon. How “green” is the growth? There are signs of green-ness (e.g. the LEED certification on the Sheraton hotel) visible to the trained eye, but otherwise one would have to look at actual data to know how to evaluate it. Fortunately, South Korea has an entire Global Green Growth Institute whose purpose, in part, is to study these things (http://www.gggi.org/About/About_01.php). And you can read more about the national Green Growth strategy of South Korea here:  http://www.greengrowth.go.kr/english/en_main/index.do

What I do know, about Incheon (my home for a week) and about S. Korea in general, is that the level of ambition — for growth, for green-ness, and also for being a promoter of Green Growth on the international stage — is impressive. The scale of what is happening there is enormous. And it is happening with extreme rapidity.

Whatever is happening in Incheon, it is very definitely the future of this part of the world, growing before our eyes. And that’s something that every serious student of sustainability should study and reflect on.

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Note: If you want to learn more of the basics of Incheon’s green city program, focused on the Songdo International City region where I was staying, here is Warren Karlenzig’s good blog post about a visit there in 2009. To see how the city describes itself, visit:  http://english.visitincheon.org/

“San-ten-ichi-ichi” — what March 11 means to Japan (so far)

I was on UN business in Korea this week, but on Friday, I took a day off to fly to Osaka and meet with friends Junko Edahiro and Riichiro Oda, at a hotel near Osaka’s Kansai airport. I wanted to find out how they were doing, and how the country was doing, since the last time I visited — which was the week before the earthquake. Both Junko and Rich are marathon runners; they looked the picture of health, and made me think once again about diversifying my exercise routine, which usually consists of pulling suitcases around in airports.

Junko is a well-known environmental advocate, writer, and translator. She wears many hats in her nation’s sustainability movement, including founder of the NGO Japan for Sustainability. Sometimes Junko is teaching classes on how to combine three e’s:  learning English, empowering oneself, and doing environmental work (one of her companies is actually called “e’s”). Sometimes she is advising the prime minister on options for climate change policy — among many other activities. Riichiro, or “Rich,” is a systems expert and consultant who teaches corporations and agencies how to apply systems thinking; he also manages the administration of Junko’s various enterprises and initiatives, which she seems to create at the rate of about one per year.

Most recently, Junko founded a new Institute for the Study of Happiness, Economy, and Society. A few days before the multi-disaster comprised of a mega-earthquake, a giant tsunami, and a nuclear meltdown, I had been in Japan to help her launch that Institute. Now, to say the least, the context within which that new institute is working has been utterly changed. I also went to Japan to find out how it has been changed, from Junko and Rich’s perspective.

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First, the language:  most Japanese now refer to the disaster in the same way that most Americans (and indeed, most of the world) refer to the events of September 11, 2001.  It is just called “San-ten-ichi-ichi,” or literally, “three-dot-one-one.” And the region where the disaster struck, and where it is in fact still striking in the form of uncontrollable nuclear reactor failures, is called “the Affected Area.”

“March 11 marked the true end of the post-War period in Japan,” says Junko. “Before that point, the country believed that we could eventually get back to the kind of economic growth we had experienced before. March 11 crushed any hope of return to growth, and has forced the country to face the harsh reality.” A society-wide process of deep consideration is under way, among government and corporate leaders as well as the general public.

If anything, the disaster has increased interest in sustainability, resilience, systems thinking, and any possible avenue to new insight about how to reorient economy and society in the post-“San-ten-ichi-ichi” period. The highly efficient “just-in-time” inventory and production system proved fragile. There were no stocks or buffers of materials and parts on which to draw when production was disrupted. Recent cost-cutting of staff also eliminated much of the Japanese “playable force” staffing system, in which companies always had a spare team of people who could be deployed to reinforce those functions that needed extra help. This new awareness of “system effects” is helping Rich’s business return to his normal, overloaded state of busy-ness.

March 11 has also had a number of unexpected social effects:  marriages are on the rise, as couples move to cement their relationships quickly to increase a feeling of security about the future. Community-based activity is also increasing. But at the same time, the Tokyo area has also experienced a wave of divorce and strained relationships, as families split over the question of whether to remain there, or move farther away, to Osaka or the west of Japan. When it comes to radiation exposure and young children, “mothers want to lower their risk to zero.” Many are moving away from Tokyo with their children, leaving behind their husbands, who are attached to jobs and other social roles. In doing this, Japanese mothers are following the example of foreign embassies such as France, which sent some people home and moved everyone else to Osaka. (The irony of Junko’s choosing France as an example, given how defiantly reliant France is on nuclear power, is worth considering.)

It was shocking to hear Junko’s descriptions about how much — or rather, how little — information was being given to the Japanese people through the official channels. Because she is a professional translator, she had access to multiple English-language sources on the internet that explained far more about the nuclear disaster itself, the radiation leaks and risks, etc. than was ever available in the Japanese press.  Junko took it on herself to explain this information in everyday Japanese, and recruited a radiation expert from a research hospital (i.e., someone not tainted by TEPCO, the fully discredited electricity company that owned the Fukushima nuclear plant) to check what she wrote. This information she broadcast on her already popular e-newsletter, the readership of which grew significantly.

As a result of both the mismanagement of the crisis and the authorities’ poor handling of information about what had actually happened, the traditionally submissive relationship between the people and the national leadership has become deeply frayed. The crisis revealed, said Junko, that the government did not really trust the public.  Authorities controlled the release of information in order not to “create panic,” but in doing so created more nervousness and panic, which created more distrust, more information control, and more nervousness and panic, in a vicious circle. “It is easy to make a systems diagram of this,” she notes with a hint of irony, “and I have drawn many of them.”

Why was it so difficult for people to get information on radioactivity and other nuclear power issues in Japan, in the midst of a nuclear meltdown crisis? And why does Junko — whose bridge-building work usually attracts positive attention from groups as diverse as deep-green environmentalists and big-industry representatives — start getting attacked her efforts to publish more of the facts on what was actually happening at Fukushima?

“Nuclear power is an emotional or ideological issue here,” said Junko, whose academic training was in psychology. “People, especially men, tend to equate nuclear power with power generally.” I note recent psychological research showing that when people have strong ideological commitments, fact-based counter-arguments often just harden their positions. This explains how even in the face of a meltdown — one that will make a large area sited only 150 km north of Tokyo uninhabitable for generations — nuclear power still has rabid defenders in Japan.

The electricity shortages themselves, common in Tokyo but not in Osaka or elsewhere, act as a continuous reminder of the situation. The lighting in train stations and other public locations is noticeably dimmer, Junko tells me. But this “dark side” has a “bright side,” because “people are realizing that they did not need all that light in the place. The dimmer light is more comfortable.” The directives to reduce energy are causing a kind of social transformation, in everything from direct energy usage (turning off Tokyo’s ubiquitous vending machines) to the way people dress at work (men are encouraged to ditch their suits in favor of a “super-cool,” tie-less look that requires less air conditioning).

“People are rediscovering the meaning of ‘enough’, and remembering that ‘enough’ is also comfortable,” says Junko.  This reminds me of the concept of a “teachable moment,” which I learned practicing social work years ago:  the moment when defenses come down and the person can actually learn something that changes their view of themselves and the context of their lives. Junko grabbed onto that term immediately. “This is such a moment,” she says, “so I am doing a lot of teaching.”

But she is also doing a lot of learning. In March and April, her usual busy speaking schedule was largely canceled, and Junko suddenly had a lot of time on her hands. So she used it to pursue a ten-year-old dream:  to study the Chinese classics (such as the “Analects of Confucius”). She found a teacher, signed up for classes, and started studying … which, among other things, involves learning 52,800 Chinese characters. “In the Edo period,” Junko tells me, “children would learn these characters. The saying was, 100 characters, 100 times a day.” That is, they would repeat each character a hundred times, until they had memorized it, and they would do that with a hundred characters, every day — usually before even learning what those characters meant. After one and a half years, they knew them all, and could start reading. “I think it will take me a bit longer,” she says with an impish smile.

In dialogues, Junko and her teacher learned that they share a common sense of purpose, even though they are promoting different things. Both are teaching in order to change and improve Japanese society.

And if ever any society was faced with a “teachable moment,” it is Japan, now.

Watching Egypt 1 – Private Worries, Public Hopes

It was a relief to finally hear my client’s voice on the phone. She was a bit breathless, but not sounding in distress. She had been out food shopping by taxi just that afternoon (this was Monday, 31 January), able to find what she needed, “though many people are just buying up whatever they can get, and hoarding it,” she noted. She was surprisingly worried about work, and about the project we’re working on, a major strategy document for economic competitiveness and Green Transformation in Egypt:  “No one is going to the office, because there is no point, the internet is shut down.”

And of course, there was the fire.

The first four floors of the office building had been damaged by a fire set in the shops on the ground floor, probably in connection with looting. Fortunately, the offices of the Egyptian National Council on Competitiveness (ENCC) are on the fifth floor. So the home of one of Egypt’s most important small think-tanks, a place where a true transition to sustainability was being mapped out in careful detail, is still intact.

Whatever happens in Egypt, the country is going to need that Council, and that new Green Transformation strategy, more than ever in the coming years. One of the many documents I had absorbed in trying to learn about the situation there (as part of my work as a strategic advisor to the ENCC) was the most recent national Human Development Report. The numbers on youth unemployment alone, and the accompanying quotes from young, educated people (whose needs for a meaningful life had clearly not been met), were enough to make the events that are happening now in Egypt all too easy to understand.

Not to mention the many comments I had heard from many people when I visited there, on three occasions last year. These comments were usually whispered, or voiced only after a quick look to the left and the right to see who might be listening (if one were in a public place). It reminded me of being in China in 1982, when people I met on the street literally dragged me behind bushes to have conversations about freedom in some European language they were studying. Egypt was not that extreme, but the feeling of caution, bordering on fear, about saying what one really thought was something I encountered regularly on my visits there.

Suddenly, the whispers have grown to a roar.

Hindsight is 20/20, they say. But in this case, many Egyptian experts had 20/20 foresight as well. No one could have predicted an uprising of this kind, of course; and no one I have met while working there predicted it to happen now. But almost everyone said, either subtly or directly, that something like this — a “phase shift” or “nonlinear event,” an encounter with unsustainable trends, building up to a breaking point — was inevitable if Egypt did not make major, transformative changes, and quickly.

The world, watching Egypt, now sees the demands for political openness and justice that are visibly driving the protesters. What is not so obvious is the array of other issues that have contributed to this enormous, tsunami-like outburst of “We’re not going to take it anymore” public emotion.

For example, Cairo was experiencing water shortages as well as sporadic blackouts when I visited last year. These are not usual; they were practically a first. Egypt has prided itself on its provision of energy and especially water to its people in modern times; they are serious matters of national security. But one man I met was embarrassed to be photographed, because newly imposed water restrictions had prevented him from shaving for a few days:  “The Quality Control Director of a food processing factory [his job] should not appear in a photograph unshaven,” he told me.

Meanwhile, prices of some common foodstuffs and other consumer goods were also suddenly skyrocketing, some friends said, and those price increases were not being reported publicly. They were just being felt, and they were so significant that even my wealthier friends were feeling it.

And these were just the pressures visible to anyone.  While energy prices were still heavily subsidized, Egypt had recently changed over from being a net oil exporter to being a net oil importer. It was meeting the deficit — and the needs of its fast-growing population of over 80 million — by pumping out natural gas faster than ever. The production curves literally turned almost straight up.

Were these the indicators of a sustainable future?  Not a chance.

I am convinced these and other pressures, both visible and less visible (but widely known), helped to create a general feeling of unease, and that this feeling combined with the much more visible calls for democracy and openness that are now playing out so very publicly on the world stage. All of it taken together created a pile of very dry social kindling. The dozens of self-immolations that followed on Tunisia’s example were literally the spark that lit a conflagration.

Today, the hopes regarding Egypt are many. Indeed the hopes of the people there, and the hopes of the world on their behalf, have already become highly documented history. World leaders are speaking out in support of the protesters demands in almost unprecedented ways — or at least, in ways not seen since 1989 and the fall of the Berlin Wall. The public statements of Egypt’s military are no less remarkable in their embrace of transition.

But I have private hopes, as we all do. First and foremost, as an outside observer with clients and friends in Egypt, I hope for their safety and security. (I could easily have been in Egypt the week the protests began, as I had been invited to the country for a work engagement, but felt the need to stay home for family reasons.)

And I also have private worries, more than I care to express in a public blog — worries for the safety of specific individuals I know and their family members. I join my voice to the prayers for safety that my client mentioned so many times, when I finally reached her on her mobile phone on Monday.

When it comes to the Egyptian transformation — for that is what we are witnessing — I think most engaged observers have both high hopes and big worries for its outcome. The opportunity for change is enormous now, and Egypt truly needs enormous changes:  this was a core message of the materials that had been presented to ministers and senior business and society leaders in May of last year. These Egyptian-born ideas about purusing a Green Transformation strategy — renewable energy, water consevation, sustainable agriculture, jobs and capacity development, innovation, education — were due to be presented in an even more strategic and practical way this year.  These were urgent matters before (they were being increasingly framed as national security issues) and they remain urgent, perhaps “super-urgent”, matters for the foreseeable future.

And now, one can add a phrase to the list of “super-urgent” matters, a topic that was essentially taboo just two weeks ago, a topic that numerous people essentially only whispered to me previously, a topic than anyone with access to a global news source can now plainly attest to as being the desperate longing of the Egyptian people, a topic that may even become the source of the accelerated sustainability transformation that Egypt desperately needs:

Democratic participation.

What is the GDP, Anyway?

As the world spins deeper into economic recession (is anyone formally using the word “depression” yet?), it seems appropriate to take a look at the number by which we measure such things:  the  Gross Domestic Product, or GDP.  This mega-statistic is the indicator used by countries since WWII to measure their growth, and is by far the dominant measure of overall national progress. And yet, the creator of the GDP, Simon Kuznets, actually warned the United States Congress against using it to measure national progress.  In this video excerpt (of a lecture given in Australia in 2001), I recount the history of the GDP.  I also once wrote a song about the GDP — yes, a song, sung to the tune of a lively Latvian melody — but more about that later.