Whether or not the United Nations-brokered talks on a global carbon-reduction agreement currently limping toward their conclusion in Cancun go anywhere, climate change isn’t waiting. Scientific assessments, such as the Intergovernmental Panel on Climate Change’s regular reports, have noted more significant climate change impacts than previously expected, and amplified their warnings of the changes to come. The environmental bad news is economic bad news as well: A mid-2009 report by the reinsurance giant Swiss Re found that climate change could shave off anywhere from 1 to 12 percent of GDP in many countries thanks to shifting climate zones, floods, droughts, and sea-level changes. The stakes are high, and it’s time we started treating climate change as a risk we insure against through investment, just as we treat national security, natural catastrophes, terrorism, and nuclear proliferation risks.

Governments, however, seem paralyzed. Some countries have actually retreated from the progress made in Copenhagen. Not all of their reasons for inaction are indefensible: In a world where just 15 percent of the population concentrated in the developed world accounts for half of all global carbon emissions, fairness and effectiveness in climate policymaking don’t often line up. The nations involved in the Cancun summit are trying to hammer out an agreement without many of the most basic bedrock questions answered: Who gets to make the rules governing global climate solutions? The countries with the biggest bulk and heaviest sticks? How do you strike a balance between a country’s needs today and its needs in 2050? Perhaps the only morally defensible “fair thing” to do is to give every person the equal right to pollute the air -- but this formula does not work well for the planet, or for the influence, politics, and self interest of the Western world.

COMMENTS (1) SHARE:

Twitter

 

Reddit

 

More...

Fortunately, while governments ponder what to do, the world’s best and brightest are inventing our way out of the climate crisis. This global race to create clean energy stands a better chance of helping us avert climate change than any political agreement. Thus, it is critical that technology investment continues -- or, better yet, accelerates.

What matters isn’t just technology investment, but also the kind of technology investment. Near-term carbon reductions -- such as switching from coal to natural gas, building wind turbines, or incrementally increasing residential energy efficiency -- are nice, but they’re not enough. What we need are more efforts to speed up and expand the search for “black swan” technologies: innovations that disrupt our current trajectory and establish economically feasible means of reducing carbon, to build what I call our “economic carbon reduction capacity.” These advances are crucial for the simple reason that the clean technologies we have now are not enough -- we are not yet at a point where we can simply “deploy” our way to a prosperous, ultra-low carbon future. Our current suite of policies makes the mistake of putting nearly all of our efforts into using the limited tools we have in our carbon-reduction toolbox today, when we should also be focusing on developing the better tools of tomorrow.

First, let’s look at the problems with the status quo approach. Given a 3.1 percent global GDP growth rate, McKinsey has estimated that the carbon efficiency of the world’s GDP needs to grow at about 5.6 percent per year to meet the recommended global targets of 80 percent carbon reduction by 2050. Many argue that since we already have some technology today, we should simply deploy it. I believe doing this alone runs the risk of spending a significant amount of money on infrastructure that will require continued subsidies to survive. By diving into ambitious deployment efforts -- for instance, massively scaling wind farms or today’s geologic carbon capture and sequestration technology -- too early, we will be yoking ourselves to a carbon-reduction plan that is massively expensive to build and maintain.

As an alternative, we could aggressively develop next-generation technologies which build our economic carbon reduction capacity, while continuing to deploy current technologies on a limited basis to drive continuous improvements. This shift in focus will help change the cost equation by developing more economic clean technologies, and increase the likelihood that economic gravity -- not subsidies or government imperatives -- drives large-scale deployment on a broad scale. This strategy may yield fewer emissions reductions in the short term, but will enable faster and more economic carbon reduction in the coming decades.

So what are these next generation technologies, these black swans of energy? These are risky investments that stand a high chance of failure, but enable larger technological leaps that promise earthshaking impact if successful: making solar power cheaper than coal, for example, or economically making lighting and air conditioning 80 percent more efficient. Consider 100 percent more efficient vehicle engines, ultra-cheap energy storage, and countless other technological leaps that we can’t yet imagine. Our portfolio at Khosla Ventures has several companies that are focused on each of those goals, and there are thousands more not in our portfolio targeting similar ones.

It’s unlikely that any single shot works, of course. But even 10 Google-like disruptions out of 10,000 shots will completely upend conventional wisdom, econometric forecasts, and, most importantly, our energy future. We should learn from Craig Venter; he sequenced the human genome faster and more cheaply than the government-funded Human Genome Project, by designing better tools for sequencing rather than relying on the brute force sequencing techniques that existed when he started his work.

12NEXT