Some comments on the talk “Does Cheap Oil Weaken The Case For Energy Efficiency?” organized by the Business Circle

Last Friday I attended a talk organized by the Economic Transformation Programme’s Business Circle, through its platform Industry Speaks, a regular series of events which “aims to create dialogue between leaders and experts within the business sector, provide an avenue for immersive discussions, and share new ideas across a range of topics”. The talk, titled “Does Cheap Oil Weaken The Case For Energy Efficiency?”, had the following speakers:

From left to right: Dato' Ir. Dr. Ali Askar Bin Sher Mohamad, Mr Anand Menon, En Hamdan Abdul Majeed, Mr Umagapagan Ampikaipakan

From left to right: Dato’ Ir. Dr. Ali Askar Bin Sher Mohamad, Mr Anand Menon, En Hamdan Abdul Majeed, Mr Umagapagan Ampikaipakan

I attended the event enticed by the question in the title, with the intent to hear the facts provided from the invited business experts to help me understand the context of current economic trends. Environmentalists depend upon the government and industry to get their numbers and from there draw conclusions. I wanted to know, “Does Cheap Oil Weaken The Case For Energy Efficiency?”

But the question is never addressed

The moderator proceeded to pose diverse questions here and there to all three speakers. During this exchange, mainly opinions were provided, and a few scattered facts and numbers. The topics discussed included how effective any regulation on energy efficiency might be, who is to be blamed for our energy wastage, how externalities are not factored in the price of the fuel, among others. However, after a full 35 minutes of deliberations had taken place and the time for the Q&A had arrived, the one question we came to hear about, “Does Cheap Oil Weaken The Case For Energy Efficiency?”, had yet to be addressed.

Approaching the end of the Q&A session, one attendee pointed out that the question had yet not been answered, and aptly proceeded to ask it explicitly. The panel speakers, once again, provided just personal opinions. No facts, no data, no insider knowledge, no anything. Later on, another attendee would fill the gap to provide a response: “No, cheap oil will not weaken the case of energy efficiency, because the proportion of oil in the current energy mix is so low that even increasing this number will not make much difference”.

Somebody from the public had finally replied the question. But yet I couldn’t stop wondering, why hadn’t anyone from the panel actually addressed the question they had supposedly come to talk about?

Some Observations

The event was no big deal, but I happened to notice a few interesting issues here and there, coming from different speakers:

Observation 1: mostly opinions, very few actual facts

Except for a few exceptions, I was left with the impression that the speakers were not fully prepared for the topic in question. They didn’t provide much data or actual facts, but mainly opinions, and, in way too many cases, these were not even relevant to the issue they were supposed to discuss.

Observation 2: derailing from the topic

Think City’s Executive Director En Hamdan Abdul Majeed’s made repeated comments on why we can’t achieve energy efficiency, placing the burden on people’s moral responsibilities. As an example, he mentioned that we keep our TV in stand-by mode during the night, thus wasting energy. His remarks imply that we get what we deserve, as a consequence of our personal behavior.

Issue is, we were never talking about this issue, I see no connection to the price of oil affecting energy efficiency.

Observation 3: ignoring important issues

An attendee brought forward to debate a most-pressing issue: concerning the limit of 2 degrees Celsius of average global temperature raise. He asked to all three speakers: “Why aren’t we focusing on the one fact that we cannot burn fossil fuels anymore, independently of their availability, price, origin, or whatnot?” But his questions went by pretty much unanswered, pretty much ignored.

Giving sense to the observations

Some personal comments arising from these observations:

Anyone can give opinions. What matters are facts

Did their opinions of the speakers have merit? Possibly. Individuals who hold prominent positions within the industry (should) have access to quality data, so their expert opinion may carry more weight. Yet, we could similarly argue that their expert opinion could be skewed towards their own interests. This problem is mostly solved by providing actual facts or numbers, and these were mostly absent during the event.

So hopefully, their upcoming events will provide more specific information, and not just opinions from so called experts.

Inviting relevant speakers

The exceptional, indeed useful information was mostly provided by SEDA’s Chief Operating Officer Dato’ Ir. Dr. Ali Askar Bin Sher Mohamad. Among other things, he mentioned that the all-too-important Energy Efficiency Act, that is the energy efficiency regulation bill, had been dismantled, even though a full 95% of it had already been drafted. He could not give reasons why this happened (“maybe pressure from the industry”, he wondered out loud).

That’s certainly precious information to have. So I will suggest that the law-makers and congressmen and government officials in charge of drafting the energy efficiency regulation (or the current Energy Efficiency Action Plan, successor to the failed Energy Efficiency Act) be invited to be the speakers of upcoming events. That will really make us advance forward in the understanding of the situation.

Keeping focused on the conversation

I was troubled by Think City’s Executive Director En Hamdan Abdul Majeed’s constant blaming our behavior as profligate energy consumers (“We are choosing not to change”, he said). I think this was completely off topic, completely unneeded.

However, let’s assume for one moment that his comments were valuable. Then, I’d like to point out that this strategy of pointing fingers is harmful and will take us nowhere. We can easily justify our inaction on what others are doing (or not doing), because there will always be somebody in the wrong.

Take the case of climate negotiations: USA says they won’t reduce CO2 emissions if 3rd world countries don’t do the same, India and China state they have their right to pollute as much as developed nations have historically done, and smaller countries do not even try, what for if the big polluters can do as they please. It’s a stalemate, and all the while CO2 emissions keep climbing out of control. By having each country point fingers at others, this strategy is leading all of us to catastrophe.

So, I’d like to hear the solutions that each one of us can bring to the table, instead of the reasons why we don’t do much since others are not doing anything either.

The economy is not independent from the environment

I mentioned earlier about the 2-degree Celsius mark that average global temperatures cannot exceed. Here more elaboration on why this is so:

As unanimously agreed in Copenhagen 2009, if exceeding the 2-degree Celsius mark, there is a risk of triggering nonlinear tipping elements, such as the disintegration of the West Antarctic ice sheet leading to sea-level rise, large-scale Amazon dieback, and other catastrophic and life-threatening events.

To stay within this limit, we need to constrain the amount of CO2 released to the atmosphere. As explained in film Do the Math produced by climate action campaigner 350.org, the current fossil fuel reserves, buried underground, account for 2,795 gigatons of CO2 yet-to-be released into the atmosphere, however our limit is only 565 gigatons, or only about a fifth of the total reserves, before reaching the dreaded 2-degree mark. Which means that, if we are all keen on burning all the available coal and oil and gas buried deep underground, that’s game over for the planet (well, to be precise, it’s game over for humankind. The planet has survived worse calamities, it’s us who won’t make it through).

That’s why the attendee posed that question: “Why aren’t we focusing on the one fact that we cannot burn fossil fuels anymore, independently of their availability, price, origin, or whatnot?” This is the kind of questions we should be addressing since, if we don’t, then we don’t need to worry about anything else, including selling electric vehicles or smart grids, since there will be no planet to use them on.

But as I have mentioned, the question was not addressed. Maybe the “please-don’t-burn-any-more-fossil-fuels” argument, which demands a recipe to create a sensitive business plan that sits on top of these limitations instead of ignoring them, had been misunderstood, or maybe considered out of place, since this was a business-related event, not supposed to discuss “radical” environmentalist approaches.

However, the argument is not out of place: it is still talking business. Consider the following points:

1. We are living within environmental limitations, and no entity can ignore these. Economics is a realm that operates in this planet, and as such is affected by the planet’s limitations. To argue otherwise is non-sense. A business plan that does not take the environment into account is, in the long term, destined to fail anyway and not worth considering from the onset (that is, unless one is just interested in the short-term profits and not in the long-term sustainability of any action plan or in the conservation of the planet for later generations).

2. Climate change will bring business opportunities—like selling green technology—, and quite a few people and organizations will profit from it. However, if these profits come from actual aggravating the problem (eg: the 11th Malaysia Plan, in its chapter 7 “Strengthening infrastructure to support economic expansion”, puts forward plans to increase the production of energy from coal) then it is immoral and should be avoided. There is no wrong in making money, but it is wrong when it comes at the expense of everyone else’s suffering.

The market is part of the solution, not “the” solution

Related to the previous point: the speakers might have ignored the question on carbon emission limitations out of the belief there is no need to consider it, since green growth spurred by the market will actually deliver a solution to climate change (after all, the event was organized by ETP’s Business Circle).

However, to place all our hopes in the market is what writer/activist Naomi Klein calls “magical thinking”. In her book “This Changes Everything: Capitalism vs The Climate“, which exposes the connection between business-as-usual and the lack of response to address climate change, Klein highlights how many environmentalist organizations are being misguided by advocating for-profit market solutions, instead of dealing with the roots of the problem—such as overconsumption or unsustainable energy use. Klein writes:

“In my experience,” writes [Scottish author and environmentalist Alastair] McIntosh, “most international climate change agency personnel take the view that ‘we just can’t go there’ in terms of the politics of cutting consumerism.” This is usually framed as an optimistic faith in markets, but in fact it “actually conceals pessimism because it keeps us in the displacement activity of barking up the wrong tree. It is an evasion of reality, and with it, the need to fundamentally appraise the human condition in order to seek the roots of hope.” Put another way, the refusal of so many environmentalists to consider responses to the climate crisis that would upend the economic status quo forces them to place their hopes in solutions—whether miracle products, or carbon markets, or “bridge fuels”—that are either so weak or so high-risk that entrusting them with our collective safety constitutes what can only be described as magical thinking.
Naomi Klein, This Changes Everything, from chapter 6: “Fruits, Not Roots: The Disastrous Merger of Big Business and Big Green”

Technology is important for energy efficiency and for climate change mitigation and we need to be aware of the capabilities the industry is able to deliver. However, green technology is not the one and only solution, but part of a cocktail of solutions, some of them more pressing than others. If we only depend on green technology as the solution to battle climate issues, we are certainly wasting our time.

And time is indeed running out: 2017 is considered Decade Zero for the climate, starting then, any increment of CO2 emissions will close the window we have to avert climate disaster.

Featured image by Anji Johnston

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