When the UN awarded the Nobel prize to the scientists who make up the IPCC and Al Gore in 2008 for their work in documenting climate change from greenhouse gases, in the eyes of most of the world, the science on this issue was solved. In recent months, however, a number of events have given heart to climate skeptics who never went away. First hacked emails of scientists at the Climate Research Unit in East Anglia England contained statements that caused the institute's director, Phil Jones to resign. Then the IPPC's chairman, Rajendra K. Pachauri became embroiled in conflict of interest questions. The weather itself turned cold at least in influential places like Washington, DC which received a huge snowfall last week. And Phil Jones recently told the BBC there is no statistically significant different in warming trends now and in the 19th Century. The cascade of events brought the issue to the editorial page of the New York Times which this week published an editorial on the controversy, saying the stakes are so high that scientists need to act in a way that is beyond reproach. The new datapoints are not enough to change the views of experts, but they have given the skeptics ammunition with which to launch a full scale offensive in the conservatie media and led, Donald Trump, for example, to call for Al Gore's Nobel prize to be revoked.
While I am not a climate scientist, to my mind abornormally cold weather could be as much an argument for climate change as abnormally hot weather and what happens in Washington DC is not representative of the planet as whole. But I believe these questions are best left to scientists. The question I want to address is whether cold weather this year has any bearing on the need to build a cleaner more efficient economy. In my view, the answer is no. The business and policy case for clean technology is compelling whatever may be happening to global temperatures year to year.
Clean technology is not just about greenhouse gases. It is about reducing conventional pollutants--particulate matter, mercury in fish from burning coal and other byproducts of burning fossil fuels. It is also about promoting peace through renewable power since resource economies are notoriously unstable and undemocratic. (Oil is a virtual magnet for violence and the fact that the oil states tend to be anti-democratic is a special case of this general rule.) And it is about bringing the energy sector into the 21st Century. Something often forgotten in talking about clean technology is the fact that the energy industry--in particular the electricity industry is unique in the modern global economy in having been starved for decades for money for research and development. The R&D deficit in the electricity industry--the industry at the center of the wider energy network--is severe and it has been severe for decades. This is the deficit that more than climate change or anything else has created the clean technology opportunity.
It is sometimes said that Thomas Edison would recognize today's electricity system it has changed so little in the past century. And one of the main reasons clean tech garnered $5.4 billion in investment last year according to the Cleantech Group, much of it in energy, is that the sector has been neglected for so many years. Switches remain mechanical and wires are often undersized. But the next question is why does the electricity industry spend less than 1% on R&D each year compared with 10% or more in technology industries? The answer is that its highly regulated structure provides no reward for risk and, indeed, creates a bias in favor of legacy technology. The decades old innovation deficit in electricity is what makes the category such a deserving one for investment today. But the cause of that deficit is the chief obstacle to modernizing the industry.
For the investments in clean electricity to achieve their full potential, the underlying reward risk profile of the industry needs to change. The electricity industry requires an upgrade to Electricity 2.0, a new modernized, open architecture to allow more players to participate in electricity markets, democratize global energy and unleash a renewable revolution. Those changes and upgrading our electricity system to Electricity 2.0 need to happen no matter what occurs with global temperatures.
In short, while climate change remains a presssing and perhaps existential concern it is only one of many reasons to create a new clean energy future. Clean technology will be central to America and the world's economic future, regardless of what happens to temperatures in a given month or year.