IN DEPTH: Forget business as usual
Senior DNV GL executive Bjørn Haugland talks about the big issues facing renewables ahead of Recharge’s Holmenkollen summit in Oslo.
The journey towards a low-carbon society is raising many issues and challenges. How would you quantify the importance of these challenges and which are the bigger ones you think need to be addressed at Holmenkollen?
The main challenge, in my opinion, is to create and communicate a compelling and inspiring narrative of a sustainable, low-carbon future, and create a solid road map on how to manage the transition. This narrative must be created in a way that communicates with a broad range of people and touches their hearts.
The latest Intergovernmental Panel on Climate Change reports clearly state the risk of continuing “business as usual”. Still we are struggling to create the necessary awareness, establish frameworks and conditions for change and inspire the movement needed in the population.
We need to elaborate on the cost of “business as usual” and, by that, the total cost of the current energy system. A study by the Danish government’s environmental agency some years back suggests that emissions from shipping cost the Danish health service almost £5bn ($8.1bn) a year, mainly treating cancers and heart problems. A previous study estimated that 1,000 Danish people die prematurely each year because of shipping pollution. This is the true cost of “business as usual”.
I lived in China for four years and have been many times to Harbin [a city of ten million people in northeast China]. The images we saw there recently — of thick smog with schools and a regional airport shut, and poor visibility forcing ground transport to a halt — touched my heart.
These are the consequences of a consumer economy based on “spend money we don’t have to buy stuff we don’t need”, with high social and environmental costs.
Only large-scale awareness in society of the need to take action will lead to change, and there seems to be a gap between the data communicated and what people are ready to take on board. Too many like to ignore the facts. A change in behaviour is needed; from big companies to small communities and individuals. Also, the renewables industry needs to be much better at communicating the societal benefits of clean energy.
I hope the Holmenkollen dialogue can advance the renewables industry’s ability to communicate a holistic view of the transformation of the energy system and integration of renewables in a more compelling way. We should make our contribution to create a movement.
The issue of scaling is also important. We should review the improvements needed in key renewables technologies to drive down life-cycle costs and make renewable energy more competitive.
We shall also focus on “what’s next” and look at transformative technology such as floating wind, smart and supergrids and storage technologies.
In an age of financial austerity, particularly in Europe, there is growing pressure on renewable energy from an increasingly sceptical political class. How important is it to convince cash-strapped governments — under attack because of rising electricity bills — to continue supporting renewables?
Again, business as usual also comes with a cost. Today, the EU imports more than 50% of the energy consumed in member states.
[We need to convince governments that] making the EU economies energy-efficient and climate-friendly would lead to a massive shift from fuel expenses to investment expenditure. These investments would add value to and increase output from our domestic economy, whereas fuel expenses largely flow out of the EU. This will improve the EU’s security of energy supply and make the economies less vulnerable to oil price. Plus, renewable energy has a strong track record in job creation. In just five years, the renewables industry has increased its workforce from 230,000 to 550,000.
In the longer term, the creation and preservation of jobs will depend on the EU’s ability to lead in the development of new low-carbon technologies, as well as maintaining favourable economic framework conditions for investments. Changing the energy system, transport and the housing sector will increase demand for new skills and competences.
Are governments doing enough to provide the right framework for the transition to happen? Probably not. One of the barriers we are facing is the belief that the transition to a low-carbon economy will happen without investments. We need to start implementing solutions that, in the short term, are more expensive than continuing with “business as usual”, and here governments can certainly do more to provide stable and predictable frameworks.
Recharge Thought Leader Bjørn Haugland is executive vice-president and chief sustainability officer at DNV GL. He was previously chief technology officer at DNV