Thursday, 11 February 2021

The Economics of Biodiversity

 

On 2nd February 2021 a major review was produced by Sir Partha Dasgupta, Professor of Economics and Cambridge University – “The Economics of Biodiversity”.

 

This is an expertly articulated 600-pagetome which does what it says on the tin – it looks at the economics of biodiversity, but it does so in a quite fundamental way.  Fortunately, there is also an abridged version (100 pages) and much shorter summary of headline messages.

 

Most media reports about this Review lead with the idea that it is “putting a price on nature”.  This has been picked up by both those promoting the concept and those opposing it, but as far as I can see this is a severe miss-representation of the Review.  Putting a price on nature implies reducing nature to tradable assets – putting a financial number against species and habitats so we can trade them for something else if something else has greater value for us.  This is the model of seeing nature as fitting within, and being subordinate to, the economy.  This is the opposite of what the Review actually says.  The Review develops the economics of biodiversity “on the understanding that we – and our economies – are ‘embedded’ within Nature, not external to it”.  So, the economy fits within the environment, not the other way around.

 

The leading message from the Review is therefore that we depend entirely on nature; it is our most important asset, but our demands far exceed the capacity of nature to supply the goods and services we rely on.  We should all know the problem – we “mine” what we want from nature with little respect for the repercussions.  The result is climate and ecological collapse. 

 

The Review concludes that we must change the way we think, act and measure success.  And this is perhaps its most important message.  At present societies measure their success by measuring GDP (Gross Domestic Product).  But this is just a measure of all financial activity and bears little relationship to the wealth of society.  Whether producing something, causing pollution, driving ill health, or clearing up the mess afterwards, this is all added together and counted as positive using GDP as a measure.  Instead, the Review says that we should develop a new metric – one of “inclusive wealth”.  This metric would measure wealth in terms of 3 capitals – produced capital (machines, buildings, stuff etc), human capital (knowledge, health, skills etc), and natural capital (plants, animals, soil water etc).  So, we measure our “wealth” in terms assets, not in terms of the speed of money turnover.

 

We have been thinking this way in Sussex for over a decade and the Sussex Local Nature Partnership, with over 25 member organizations, is based on exactly this premise.  Take a look at the Sussex Natural CapitalInvestment Strategy to read more about how this works at a local scale.

 

Currently, nature is considered to have zero value, so any extraction or development does not pay the price of the natural capital it is destroying.  This is skewed accounting that is inevitably to the unfair advantage of destructive industries.  In future, however, not only must decision-making consider that nature has a huge value, but it will also need to recognise that this value is often non-tradable.  Nature has value as an entire working system, however its components (species, habits, spoils, cycles etc) cannot be priced and traded away.  The concept is good but let us now see whether, in practice, the value of nature turns into price, the price then is reduced and the untradable is traded in order to carry on with business as usual.

 

The sceptic in me realises that this is not new, however.  The UK National Ecosystem Assessment back in 2011 came to very similar conclusions.  International reviews such as “the Economics of Ecosystems and Biodiversity” and the “Millennium Ecosystem Assessment” also said similar things up to 2 decades ago.  Our leisurely approach to the gathering ecological crisis has meant that we have wasted decades while the need for action has become ever more vital.  And it is not as though there has been no warning.  Why should this Review succeed while others lie gathering dust on the shelf?

 

Hopefully, however, there are differences.  First the climate and ecological crises have become impossible to ignore.  Skewed accounting can no longer hide the huge losses to humanity from the destruction of nature.  But perhaps most significant is that not only was this report written by a leading professor of economics (not ecology) but that it was contracted by The Treasury (not DEFRA).  Maybe we are now recognising that the ecological crisis is not only affecting humanity, it is affecting the economy – now we might take it seriously!  It’s a shame that it is money that talks, not human well-being.

Tuesday, 5 January 2021

Electric Vehicles – the answer to all our transport woes – or not?

 

It’s tempting!  We all seem to love our cars, but wouldn’t it be great if they could run on something that didn’t cook the planet.  Along come EVs and - hey presto – problem solved.

 

But maybe it’s not that simple. 

 

There is a tiny proportion of EVs on the road and even if we changed tomorrow all those ICE (Internal Combustion Engine) cars will still be there for at least the next decade or two – the time in which we will have to reduce their emissions to zero.  If we were going to change to EVs we should have done it 30 years ago.

 

And maybe they are not as good as made out.  The so-called “Astongate” (the story goes that this emerged from an Aston Martin advert) claimed that EVs emit almost as much CO2 as ICE cars, but this has been well and truly busted.  EVs are inherently better.  As a technology, ICE cars belong in the dark ages – slow, noisy, inefficient, complex, temperamental, polluting.  But there are still huge environmental costs in EV production.  And a change to EVs will do little to help congestion.  Indeed, having cars that are expensive to buy but cheap to use will force up both inequality and congestion (if you’ve spent all that money on a car then you will be keen to use it).

 

The problem with EVs goes far deeper than “they are not quite as good as we thought they were”.  Furthermore, the problem with EVs extends to other technological fixes to transport, indeed to technological fixes in general.  To understand this, we need to understand "Jevons pardox"– bear with me….


This paradox dates back to 1865.  At the time it was thought that the invention of more efficient steam engines would reduce the demand for coal.  William Stanley Jevons, however, observed that it had the opposite effect.  Better, more efficient technology reduces relative resource costs increasing the quantity demanded more than outweighing any possible reduction of resource use from efficiency savings.  More efficient steam engines effectively drove the industrial revolution – and that did not reduce the demand for coal!  This is not an isolated occurrence with rebound effects often coming from improvements in efficiency causing increase (not decrease) in demand.

 

EVs fit into this category.  Imagine if we all had gas-guzzling, polluting, expensive (but pretty) monsters.  We’d leave them in the garage (perhaps polish them on Sundays) and find other ways to get access to our needs and services – the congestion problem would be solved.  EVs, however, give us an easy, efficient, cheap (to use) method of transport.  So, their use will shoot up, congestion will shoot up, and emissions will increase from EV production.

 

Jevons’ paradox will also extend to other transport issues.  If we still insist on traveling everywhere, even without EVs, our countryside could be covered in infrastructure for electric busses, trams, and high-speed railways.  Environmentalists hoping that “modal shift” will solve our problems, will probably also fall foul of this rebound effect.  Making these things far better (by themselves) will probably make life far worse.

 

As with many of our global problems, faith in technology alone is a dangerous diversion – dangerous because it gives the impression that we are solving a problem when we are not.  For transport problems the solutions are more likely to lie in reducing the need to travel. This will require far more complex, but desirable, changes to society.  How do we keep access to our needs and services local?

 

Improvements in efficiency alone will be insufficient, indeed counter-productive to the low resource-use society we need to move to.  As environmentalists we often forget this, we focus too much on technology and not enough on the context within which it must sit.  Technological improvements are vital but at best they buy us more time to address the underlying problems – time which, so far, we have simply wasted.  EVs are the same – a step-change improvement on the old technologies that have hung around for far too long.  But they are a diversion, we must address our underlying societal problems that drive ever-increasing demands for travel.

 

You may be wondering – what do I drive?  And yes, I do drive an EV.  It’s great!  From now on any new car should be an EV.  But I do not kid myself that this is the solution.  Shopping locally, buying local produce, working remotely, using the bike more and walking to local green space rather than driving to distant countryside might help.  But EVs might only help once we have solved our transport problems, they are not the solution in themselves.  Our EV has a range of just over 100 miles – plenty for our needs.  But EVs are not new.  About a century ago there was an EV – the “Baker Electric” – smooth, reliable, comfortable.  It seems that vested interests in oil pushed a superior technology into the background.  The Baker Electric had a range of – just over 100 miles!  Progress?

 

Thursday, 8 October 2020

Your Better Nature – Our new human story

 

Our world is broken. The current human story (the tale we tell ourselves of how human nature is meant to be) is toxic, suicidal and, more importantly, FALSE.  This was the premise of a series of 5 webinars entitled “Your Better Nature” that we held through September 2020. 

 

A strong environmental vision is vital, and effective actions to deliver it are equally important.  But what the environmental movement may have lacked is a human story, or narrative that brings these together.  A vision for a sustainable future will never be achieved if we see human nature in the same toxic way that has dominated society in recent history.  This is what our “Your Better Nature” discussions challenge.  COVID-19 has shown us that the myth of the selfish, competitive, uncaring human is just that – a myth.  When put under pressure, we do not turn into monsters, we return to our inherent caring, sympathetic better nature.  We need to develop a new story about what it means to be human. 

 

Our online discussions attracted more than 150 people in total and the YouTube videos have been viewed over 300 times.  This was, however, trialled on a limited audience to judge interest and get some feedback.  Indeed, the series has proved popular and the quality of the feedback is inspiring us further.  We therefore aim to develop these discussions and we are now making plans to roll it out to different audiences. 

 

Watch this space!

 

In the meantime, see the article Tuning in to Your Better Nature by Viviane Doussy in Sussex Bylines on 23rd September 2020 .

 

Take a look at how our first set of discussions went on YouTube

https://www.youtube.com/channel/UCfaCtY2izi7RzEzHXF6XTlA

and follow us on Facebook

https://www.facebook.com/yourbetternature/