thank you very much I’m Dimitri zangulus and I’m an economist us sound like a
and I’m an economist us sound like a
and I’m an economist us sound like a confession I’m afraid it is we we are
confession I’m afraid it is we we are
confession I’m afraid it is we we are the world is about to undergo a
the world is about to undergo a
the world is about to undergo a revolution our economies are about to
revolution our economies are about to
revolution our economies are about to become decarbonized and I’m going to
become decarbonized and I’m going to
become decarbonized and I’m going to argue that economists have failed to
argue that economists have failed to
argue that economists have failed to predict the scale of this revolution the
predict the scale of this revolution the
predict the scale of this revolution the degree to which we are going to
degree to which we are going to
degree to which we are going to transition to a low-carbon economy I’m
transition to a low-carbon economy I’m
transition to a low-carbon economy I’m going to argue that economists not only
going to argue that economists not only
going to argue that economists not only get the future wrong but economists make
get the future wrong but economists make
get the future wrong but economists make the future wrong to the extent that we
the future wrong to the extent that we
the future wrong to the extent that we are believed we become part of the
are believed we become part of the
are believed we become part of the problem to understand this we have to
problem to understand this we have to
problem to understand this we have to understand a little bit about the
understand a little bit about the
understand a little bit about the underlying problem of climate change
underlying problem of climate change
underlying problem of climate change greenhouse gases which cause climate
greenhouse gases which cause climate
greenhouse gases which cause climate change sit in the atmosphere for decades
change sit in the atmosphere for decades
change sit in the atmosphere for decades in some cases hundreds of years this
in some cases hundreds of years this
in some cases hundreds of years this means it’s the stock of greenhouse gases
means it’s the stock of greenhouse gases
means it’s the stock of greenhouse gases that causes climate change not the
that causes climate change not the
that causes climate change not the annual flow not the annual emissions so
annual flow not the annual emissions so
annual flow not the annual emissions so if you want to control the temperature
if you want to control the temperature
if you want to control the temperature you have to stabilize the stock it
you have to stabilize the stock it
you have to stabilize the stock it doesn’t matter whether you want to
doesn’t matter whether you want to
doesn’t matter whether you want to control it to two degrees which is where
control it to two degrees which is where
control it to two degrees which is where our world leaders at what our world
our world leaders at what our world
our world leaders at what our world leaders agreed to in Paris a couple of
leaders agreed to in Paris a couple of
leaders agreed to in Paris a couple of years ago four degrees or six degrees or
years ago four degrees or six degrees or
years ago four degrees or six degrees or toast degrees you have to bring
toast degrees you have to bring
toast degrees you have to bring emissions the annual flow close to zero
emissions the annual flow close to zero
emissions the annual flow close to zero to stabilize the stock or we can either
to stabilize the stock or we can either
to stabilize the stock or we can either do this the easy way by managing that
do this the easy way by managing that
do this the easy way by managing that transition or we can do this the hard
transition or we can do this the hard
transition or we can do this the hard way by generating such a hostile climate
way by generating such a hostile climate
way by generating such a hostile climate it severely compromised as humanity’s
it severely compromised as humanity’s
it severely compromised as humanity’s ability to exist on the planet so well
ability to exist on the planet so well
ability to exist on the planet so well let’s say we were to try and meet the
let’s say we were to try and meet the
let’s say we were to try and meet the globally agreed target of two degrees
globally agreed target of two degrees
globally agreed target of two degrees how much more carbon could we squeeze
how much more carbon could we squeeze
how much more carbon could we squeeze into the atmosphere without breaching
into the atmosphere without breaching
into the atmosphere without breaching that ceiling and that’s what the little
that ceiling and that’s what the little
that ceiling and that’s what the little blue circle shows on this chart these
blue circle shows on this chart these
blue circle shows on this chart these are just scaled circles and what you see
are just scaled circles and what you see
are just scaled circles and what you see in the black circle is the amount of
in the black circle is the amount of
in the black circle is the amount of readily accessible fossil fuel reserves
readily accessible fossil fuel reserves
readily accessible fossil fuel reserves coal oil gas that you can extract easily
coal oil gas that you can extract easily
coal oil gas that you can extract easily from the ground most of that if we’re to
from the ground most of that if we’re to
from the ground most of that if we’re to meet the two-degree target has to stay
meet the two-degree target has to stay
meet the two-degree target has to stay in the ground or if we burn it we have
in the ground or if we burn it we have
in the ground or if we burn it we have to capture the tarp that the carbon this
to capture the tarp that the carbon this
to capture the tarp that the carbon this is revolutionary the economy of the
is revolutionary the economy of the
is revolutionary the economy of the world will very quickly shift from
world will very quickly shift from
world will very quickly shift from fossil fuels to renewables and energy
fossil fuels to renewables and energy
fossil fuels to renewables and energy efficiency and I hope to explain why
efficiency and I hope to explain why
efficiency and I hope to explain why this is going to touch all of us this
this is going to touch all of us this
this is going to touch all of us this isn’t just the fossil fuel companies
isn’t just the fossil fuel companies
isn’t just the fossil fuel companies gonna feel this so an obvious question
gonna feel this so an obvious question
gonna feel this so an obvious question then at this stage is given that we’ve
then at this stage is given that we’ve
then at this stage is given that we’ve got to make such a large transformation
got to make such a large transformation
got to make such a large transformation how much is it gonna cost well that’s
how much is it gonna cost well that’s
how much is it gonna cost well that’s easy this is where economists come in
easy this is where economists come in
easy this is where economists come in they can tell you the answer and there
they can tell you the answer and there
they can tell you the answer and there it is
it is
it is don’t try and read out okay you’re not
don’t try and read out okay you’re not
don’t try and read out okay you’re not gonna make any more sense out of it than
gonna make any more sense out of it than
gonna make any more sense out of it than I am
I am
I am bizarrely enough this is the summary
bizarrely enough this is the summary
bizarrely enough this is the summary table and the summary for policy makers
table and the summary for policy makers
table and the summary for policy makers from the international panel of climate
from the international panel of climate
from the international panel of climate change the most authority Vande
change the most authority Vande
change the most authority Vande respected body in the field of climate
respected body in the field of climate
respected body in the field of climate economics and climate studies and what
economics and climate studies and what
economics and climate studies and what it says is that in 2100 the cost of
it says is that in 2100 the cost of
it says is that in 2100 the cost of meeting a two-degree target every year
meeting a two-degree target every year
meeting a two-degree target every year is going to be of the order of two point
is going to be of the order of two point
is going to be of the order of two point nine to eleven point four percent of GDP
nine to eleven point four percent of GDP
nine to eleven point four percent of GDP so there you have it thank you wait a
so there you have it thank you wait a
so there you have it thank you wait a minute this is just this is nonsense
minute this is just this is nonsense
minute this is just this is nonsense right I mean alarm bells should begin to
right I mean alarm bells should begin to
right I mean alarm bells should begin to ring when you see the Comedie decimal
ring when you see the Comedie decimal
ring when you see the Comedie decimal place you know we struggle to predict
place you know we struggle to predict
place you know we struggle to predict GDP to three years ahead let alone 80
GDP to three years ahead let alone 80
GDP to three years ahead let alone 80 plus years ahead yeah this is a period
plus years ahead yeah this is a period
plus years ahead yeah this is a period of a which the world economy will have
of a which the world economy will have
of a which the world economy will have expanded by between 300 and 900 percent
expanded by between 300 and 900 percent
expanded by between 300 and 900 percent so already
so already
so already something’s not right but this just
something’s not right but this just
something’s not right but this just doesn’t pass the sniff test let’s think
doesn’t pass the sniff test let’s think
doesn’t pass the sniff test let’s think about what we’re saying here right this
about what we’re saying here right this
about what we’re saying here right this is a scenario where from tomorrow we all
is a scenario where from tomorrow we all
is a scenario where from tomorrow we all aim to meet the two-degree target we put
aim to meet the two-degree target we put
aim to meet the two-degree target we put the best minds in the world all most
the best minds in the world all most
the best minds in the world all most creative innovators are best
creative innovators are best
creative innovators are best entrepreneurs we spend billions maybe
entrepreneurs we spend billions maybe
entrepreneurs we spend billions maybe trillions of dollars and investments in
trillions of dollars and investments in
trillions of dollars and investments in these renewables and we have a perfect
these renewables and we have a perfect
these renewables and we have a perfect policy framework with a single global
policy framework with a single global
policy framework with a single global carbon price and yet it’s still expect
carbon price and yet it’s still expect
carbon price and yet it’s still expect more expensive in every single scenario
more expensive in every single scenario
more expensive in every single scenario to employ people in far-flung parts of
to employ people in far-flung parts of
to employ people in far-flung parts of the world to dig this stuff up to put
the world to dig this stuff up to put
the world to dig this stuff up to put these fossil fuels on ships in pipes on
these fossil fuels on ships in pipes on
these fossil fuels on ships in pipes on trains transport them halfway around the
trains transport them halfway around the
trains transport them halfway around the world earn them in 19th century
world earn them in 19th century
world earn them in 19th century technology and in most cases lose much
technology and in most cases lose much
technology and in most cases lose much if not most of that energy on the grid
if not most of that energy on the grid
if not most of that energy on the grid and that apparently is going to be
and that apparently is going to be
and that apparently is going to be cheaper than actually extracting this
cheaper than actually extracting this
cheaper than actually extracting this stuff for free from the wind from the
stuff for free from the wind from the
stuff for free from the wind from the Sun and from the oceans it just doesn’t
Sun and from the oceans it just doesn’t
Sun and from the oceans it just doesn’t pass the sniff test ok there’ll be
pass the sniff test ok there’ll be
pass the sniff test ok there’ll be difficult bits for sure in buildings in
difficult bits for sure in buildings in
difficult bits for sure in buildings in industry and land use and forestry it’s
industry and land use and forestry it’s
industry and land use and forestry it’s going to be very difficult to squeeze
going to be very difficult to squeeze
going to be very difficult to squeeze carbon out of those sectors but
carbon out of those sectors but
carbon out of those sectors but transport and energy it really isn’t
transport and energy it really isn’t
transport and energy it really isn’t that much of a challenge economists get
that much of a challenge economists get
that much of a challenge economists get this wrong all the time they fail to
this wrong all the time they fail to
this wrong all the time they fail to understand the rate of deployment that
understand the rate of deployment that
understand the rate of deployment that we see in these renewable technologies
we see in these renewable technologies
we see in these renewable technologies this is a chart from the International
this is a chart from the International
this is a chart from the International Energy Agency one of the most respected
Energy Agency one of the most respected
Energy Agency one of the most respected organizations in this field the red line
organizations in this field the red line
organizations in this field the red line shows the actual rate of deployment and
shows the actual rate of deployment and
shows the actual rate of deployment and electrical capacity the other lines show
electrical capacity the other lines show
electrical capacity the other lines show you the forecasts at the ia put out they
you the forecasts at the ia put out they
you the forecasts at the ia put out they no just get it wrong in one year or two
no just get it wrong in one year or two
no just get it wrong in one year or two years or three years they get it wrong
years or three years they get it wrong
years or three years they get it wrong year after year after year after year I
year after year after year after year I
year after year after year after year I mean yeah you all know Einstein’s
mean yeah you all know Einstein’s
mean yeah you all know Einstein’s definition of madness right it’s
definition of madness right it’s
definition of madness right it’s repeating the same thing and expecting
repeating the same thing and expecting
repeating the same thing and expecting different results well that’s what
different results well that’s what
different results well that’s what they’re doing unfortunately this is a
they’re doing unfortunately this is a
they’re doing unfortunately this is a disaster because one of the key elements
disaster because one of the key elements
disaster because one of the key elements of technological revolutions is what is
of technological revolutions is what is
of technological revolutions is what is called learning by doing when you learn
called learning by doing when you learn
called learning by doing when you learn through deployment you learn to make
through deployment you learn to make
through deployment you learn to make your innovations better you experiment
your innovations better you experiment
your innovations better you experiment with them you learn through good
with them you learn through good
with them you learn through good practice you engineer them better and so
practice you engineer them better and so
practice you engineer them better and so on and the costs come down and the
on and the costs come down and the
on and the costs come down and the productivity and efficiency of the
productivity and efficiency of the
productivity and efficiency of the product goes up the ia understand
product goes up the ia understand
product goes up the ia understand learning by doing but like most
learning by doing but like most
learning by doing but like most economists they’ve really misunderstood
economists they’ve really misunderstood
economists they’ve really misunderstood the amount of doing and this is a
the amount of doing and this is a
the amount of doing and this is a disaster because you miss out this this
disaster because you miss out this this
disaster because you miss out this this charts a little busy but what it shows
charts a little busy but what it shows
charts a little busy but what it shows are two of the leading renewable
are two of the leading renewable
are two of the leading renewable technologies solar photovoltaic on the
technologies solar photovoltaic on the
technologies solar photovoltaic on the left and wind power on the right the
left and wind power on the right the
left and wind power on the right the cost of solar photovoltaic have come
cost of solar photovoltaic have come
cost of solar photovoltaic have come down by a factor of five in as many
down by a factor of five in as many
down by a factor of five in as many years now wind is a more mature
years now wind is a more mature
years now wind is a more mature technology but the cost of wind power
technology but the cost of wind power
technology but the cost of wind power have also haft over the same period both
have also haft over the same period both
have also haft over the same period both are now what’s called close to grid
are now what’s called close to grid
are now what’s called close to grid parity that is they are fully
parity that is they are fully
parity that is they are fully competitive with oil the coal and with
competitive with oil the coal and with
competitive with oil the coal and with gas okay the wind doesn’t always blow
gas okay the wind doesn’t always blow
gas okay the wind doesn’t always blow the Sun doesn’t always shine so we need
the Sun doesn’t always shine so we need
the Sun doesn’t always shine so we need some kind of storage to bridge the
some kind of storage to bridge the
some kind of storage to bridge the intermittency well the good news is that
intermittency well the good news is that
intermittency well the good news is that solar that lithium-ion battery costs
solar that lithium-ion battery costs
solar that lithium-ion battery costs have also fallen by about 40 percent
have also fallen by about 40 percent
have also fallen by about 40 percent over the same period with very
over the same period with very
over the same period with very encouraging and exciting new innovations
encouraging and exciting new innovations
encouraging and exciting new innovations in battery storage on the way it’s not
in battery storage on the way it’s not
in battery storage on the way it’s not just energy most big auto manufacturers
just energy most big auto manufacturers
just energy most big auto manufacturers have now stopped spending money on
have now stopped spending money on
have now stopped spending money on research and development in the
research and development in the
research and development in the combustion engine they’ve got narrow
combustion engine they’ve got narrow
combustion engine they’ve got narrow research budgets it’s almost all going
research budgets it’s almost all going
research budgets it’s almost all going into electric vehicles the combustion
into electric vehicles the combustion
into electric vehicles the combustion engine is over the era of the combustion
engine is over the era of the combustion
engine is over the era of the combustion engine car has finished this is a
engine car has finished this is a
engine car has finished this is a revolution it is a transformation why do
revolution it is a transformation why do
revolution it is a transformation why do economists get it so wrong why don’t
economists get it so wrong why don’t
economists get it so wrong why don’t they understand how quickly we are
they understand how quickly we are
they understand how quickly we are deploying these things well the answers
deploying these things well the answers
deploying these things well the answers reasonably simple they miss out the key
reasonably simple they miss out the key
reasonably simple they miss out the key linkages between investment innovation
linkages between investment innovation
linkages between investment innovation behaviors and cultures these feedback
behaviors and cultures these feedback
behaviors and cultures these feedback mechanisms that means that when a
mechanisms that means that when a
mechanisms that means that when a revolution happens it can happen a lot
revolution happens it can happen a lot
revolution happens it can happen a lot faster than you otherwise predicted and
faster than you otherwise predicted and
faster than you otherwise predicted and as a result they overestimate the costs
as a result they overestimate the costs
as a result they overestimate the costs of the Revolution and they underestimate
of the Revolution and they underestimate
of the Revolution and they underestimate its scale let me give you an example
its scale let me give you an example
its scale let me give you an example many of you will have been to Copenhagen
many of you will have been to Copenhagen
many of you will have been to Copenhagen or to Amsterdam and you go there and you
or to Amsterdam and you go there and you
or to Amsterdam and you go there and you ask you know you see that everybody
ask you know you see that everybody
ask you know you see that everybody cycles and you ask people why do all
cycles and you ask people why do all
cycles and you ask people why do all cycle and they will usually tell you
cycle and they will usually tell you
cycle and they will usually tell you something along the lines of well we
something along the lines of well we
something along the lines of well we have fantastic cycling infrastructure
have fantastic cycling infrastructure
have fantastic cycling infrastructure and you look around and true enough they
and you look around and true enough they
and you look around and true enough they do and then you might follow up and ask
do and then you might follow up and ask
do and then you might follow up and ask well how comes you have such great
well how comes you have such great
well how comes you have such great cycling infrastructure this point they
cycling infrastructure this point they
cycling infrastructure this point they start to look at you as if you’re a bit
start to look at you as if you’re a bit
start to look at you as if you’re a bit thick and they say well everybody here
thick and they say well everybody here
thick and they say well everybody here cycles well all right it doesn’t really
cycles well all right it doesn’t really
cycles well all right it doesn’t really matter which came first the chicken or
matter which came first the chicken or
matter which came first the chicken or the egg you can tell a similar story
the egg you can tell a similar story
the egg you can tell a similar story with renewable vehicles if you want to
with renewable vehicles if you want to
with renewable vehicles if you want to buy a renewable vehicle you want to know
buy a renewable vehicle you want to know
buy a renewable vehicle you want to know that there’s electric charging points
that there’s electric charging points
that there’s electric charging points and not petrol stations but if you want
and not petrol stations but if you want
and not petrol stations but if you want somebody to build electric charging
somebody to build electric charging
somebody to build electric charging points and not petrol stations you need
points and not petrol stations you need
points and not petrol stations you need to know that there’s enough people
to know that there’s enough people
to know that there’s enough people driving electric vehicles you’ve got
driving electric vehicles you’ve got
driving electric vehicles you’ve got these network effects you need to tap
these network effects you need to tap
these network effects you need to tap into but expectations are what drives
into but expectations are what drives
into but expectations are what drives this change in both cases expectations
this change in both cases expectations
this change in both cases expectations really matter economists tend to miss
really matter economists tend to miss
really matter economists tend to miss this out social psychologists on the
this out social psychologists on the
this out social psychologists on the other hand have known for years that if
other hand have known for years that if
other hand have known for years that if you want to solve complex coordination
you want to solve complex coordination
you want to solve complex coordination problems like climate change you need to
problems like climate change you need to
problems like climate change you need to manage and understand expectations likes
manage and understand expectations likes
manage and understand expectations likes and dislikes are not fixed
and dislikes are not fixed
and dislikes are not fixed they are influenceable social norms
they are influenceable social norms
they are influenceable social norms they’re not fixed they’re influenceable
they’re not fixed they’re influenceable
they’re not fixed they’re influenceable technologies they’re not fixed they’re
technologies they’re not fixed they’re
technologies they’re not fixed they’re influenceable and they all feed off each
influenceable and they all feed off each
influenceable and they all feed off each other in this fantastic spiral this has
other in this fantastic spiral this has
other in this fantastic spiral this has been a problem for some times for
been a problem for some times for
been a problem for some times for economists and it’s something that we
economists and it’s something that we
economists and it’s something that we really need to understand imagine for
really need to understand imagine for
really need to understand imagine for example that you’re a mayor or aura or
example that you’re a mayor or aura or
example that you’re a mayor or aura or or a politician or a business leader and
or a politician or a business leader and
or a politician or a business leader and you’re thinking of investing heavily or
you’re thinking of investing heavily or
you’re thinking of investing heavily or pushing for policies to invest heavily
pushing for policies to invest heavily
pushing for policies to invest heavily in renewables and energy efficiency and
in renewables and energy efficiency and
in renewables and energy efficiency and you think everybody else is going to do
you think everybody else is going to do
you think everybody else is going to do this if you if sorry and you actually
this if you if sorry and you actually
this if you if sorry and you actually think nobody else is gonna do this right
think nobody else is gonna do this right
think nobody else is gonna do this right so you expect the technology cost to
so you expect the technology cost to
so you expect the technology cost to stay high you expect the financing to be
stay high you expect the financing to be
stay high you expect the financing to be niche and you don’t see any huge market
niche and you don’t see any huge market
niche and you don’t see any huge market now say all things remain the same but
now say all things remain the same but
now say all things remain the same but actually you now expect everybody else
actually you now expect everybody else
actually you now expect everybody else is going to move into this very rapidly
is going to move into this very rapidly
is going to move into this very rapidly it’s the best thing since sliced bread
it’s the best thing since sliced bread
it’s the best thing since sliced bread every one of their dog wants a piece of
every one of their dog wants a piece of
every one of their dog wants a piece of it suddenly you expect the technologies
it suddenly you expect the technologies
it suddenly you expect the technologies cost to come down very quickly the
cost to come down very quickly the
cost to come down very quickly the financing will become mainstream and you
financing will become mainstream and you
financing will become mainstream and you see these fantastic new market
see these fantastic new market
see these fantastic new market opportunities so you invest and so does
opportunities so you invest and so does
opportunities so you invest and so does everybody else and the very process of
everybody else and the very process of
everybody else and the very process of investing generates the deployment that
investing generates the deployment that
investing generates the deployment that brings the cost down that makes it more
brings the cost down that makes it more
brings the cost down that makes it more attractive you start this virtuous site
attractive you start this virtuous site
attractive you start this virtuous site spiral you reach this tipping point and
spiral you reach this tipping point and
spiral you reach this tipping point and that’s and note that nothing has changed
that’s and note that nothing has changed
that’s and note that nothing has changed to accept people’s expectations in both
to accept people’s expectations in both
to accept people’s expectations in both scenarios it’s psychology it’s in the
scenarios it’s psychology it’s in the
scenarios it’s psychology it’s in the head and this is what economists tend to
head and this is what economists tend to
head and this is what economists tend to miss out and that’s exactly what we’ve
miss out and that’s exactly what we’ve
miss out and that’s exactly what we’ve seen happening on the world political
seen happening on the world political
seen happening on the world political stage over the last ten years some of
stage over the last ten years some of
stage over the last ten years some of you will remember ten years ago the
you will remember ten years ago the
you will remember ten years ago the Copenhagen conference on climate change
Copenhagen conference on climate change
Copenhagen conference on climate change which raised hopes and aspirations of an
which raised hopes and aspirations of an
which raised hopes and aspirations of an ambitious deal but it failed why did it
ambitious deal but it failed why did it
ambitious deal but it failed why did it fail because at the time the language
fail because at the time the language
fail because at the time the language was about cost it was about burden
was about cost it was about burden
was about cost it was about burden sharing it was about sacrifice it was
sharing it was about sacrifice it was
sharing it was about sacrifice it was about everyone pulling their weight to
about everyone pulling their weight to
about everyone pulling their weight to save the planet
save the planet
save the planet of course what you’ve got was distrust
of course what you’ve got was distrust
of course what you’ve got was distrust everyone wanted to free ride on the
everyone wanted to free ride on the
everyone wanted to free ride on the actions of others people waited for
actions of others people waited for
actions of others people waited for other people to move and you got a rates
other people to move and you got a rates
other people to move and you got a rates to the bottom and no deal or at least
to the bottom and no deal or at least
to the bottom and no deal or at least not an ambitious deal emerged why in the
not an ambitious deal emerged why in the
not an ambitious deal emerged why in the clock forward eight years to Paris and
clock forward eight years to Paris and
clock forward eight years to Paris and we have that ambitious deal and what’s
we have that ambitious deal and what’s
we have that ambitious deal and what’s more it’s voluntary and that deal is
more it’s voluntary and that deal is
more it’s voluntary and that deal is based on an understanding that there are
based on an understanding that there are
based on an understanding that there are opportunities and let me explain why
opportunities and let me explain why
opportunities and let me explain why that is what for a start we’ve seen the
that is what for a start we’ve seen the
that is what for a start we’ve seen the technology costs come down and that
technology costs come down and that
technology costs come down and that changes the equation commercially quite
changes the equation commercially quite
changes the equation commercially quite substantially we’ve also begun to
substantially we’ve also begun to
substantially we’ve also begun to understand that there are substantial
understand that there are substantial
understand that there are substantial gains from energy efficiency by
gains from energy efficiency by
gains from energy efficiency by definition that saves you money but
definition that saves you money but
definition that saves you money but there are other benefits as well
there are other benefits as well
there are other benefits as well pollution the World Health Organization
pollution the World Health Organization
pollution the World Health Organization and the World Bank together estimate
and the World Bank together estimate
and the World Bank together estimate that the cost of pollution through death
that the cost of pollution through death
that the cost of pollution through death through ill health through hours lost
through ill health through hours lost
through ill health through hours lost out of work in a country like China
out of work in a country like China
out of work in a country like China amounts to something like 12% of annual
amounts to something like 12% of annual
amounts to something like 12% of annual GDP twelve percent I mean that is
GDP twelve percent I mean that is
GDP twelve percent I mean that is literally metaphorically eye-watering
literally metaphorically eye-watering
literally metaphorically eye-watering excuse the pun in the European Union
excuse the pun in the European Union
excuse the pun in the European Union it’s of the order of five to seven
it’s of the order of five to seven
it’s of the order of five to seven percent these are not trivial numbers if
percent these are not trivial numbers if
percent these are not trivial numbers if we dedicated that amount of resources
we dedicated that amount of resources
we dedicated that amount of resources every year to solving climate change
every year to solving climate change
every year to solving climate change we’d probably have this licked in a
we’d probably have this licked in a
we’d probably have this licked in a matter of decades but it doesn’t stop
matter of decades but it doesn’t stop
matter of decades but it doesn’t stop there once the private sector and
there once the private sector and
there once the private sector and businesses got a whiff of
businesses got a whiff of
businesses got a whiff of the opportunities associated with this
the opportunities associated with this
the opportunities associated with this kind of change they also began to see
kind of change they also began to see
kind of change they also began to see reason to act and reason to invest don’t
reason to act and reason to invest don’t
reason to act and reason to invest don’t squint too hard at this what you need to
squint too hard at this what you need to
squint too hard at this what you need to are the only thing you need to note here
are the only thing you need to note here
are the only thing you need to note here is the figure of six million this is a
is the figure of six million this is a
is the figure of six million this is a an advert that went out in the financial
an advert that went out in the financial
an advert that went out in the financial times just prior to the Paris agreement
times just prior to the Paris agreement
times just prior to the Paris agreement in 2015 and it says six million
in 2015 and it says six million
in 2015 and it says six million companies around the world want an
companies around the world want an
companies around the world want an ambitious climate deal at the conference
ambitious climate deal at the conference
ambitious climate deal at the conference in Paris that December this is six
in Paris that December this is six
in Paris that December this is six million companies seeing opportunity and
million companies seeing opportunity and
million companies seeing opportunity and money and profit these are new lobbies
money and profit these are new lobbies
money and profit these are new lobbies new voices to counter the existing
new voices to counter the existing
new voices to counter the existing lobbies in fossil fuels they will have
lobbies in fossil fuels they will have
lobbies in fossil fuels they will have influence on political systems that will
influence on political systems that will
influence on political systems that will change policies that will change
change policies that will change
change policies that will change investments and it’s no surprise well
investments and it’s no surprise well
investments and it’s no surprise well trade in renewable sectors has outpaced
trade in renewable sectors has outpaced
trade in renewable sectors has outpaced world trade in other sectors by double
world trade in other sectors by double
world trade in other sectors by double since the financial crash sustainable
since the financial crash sustainable
since the financial crash sustainable sectors have outperformed the market by
sectors have outperformed the market by
sectors have outperformed the market by about ten percent over the same period
about ten percent over the same period
about ten percent over the same period whereas those sectors that are deeply
whereas those sectors that are deeply
whereas those sectors that are deeply entrenched in fossil fuels have lagged
entrenched in fossil fuels have lagged
entrenched in fossil fuels have lagged the S&P 500 by in some cases a very
the S&P 500 by in some cases a very
the S&P 500 by in some cases a very large margin this is a commercial
large margin this is a commercial
large margin this is a commercial opportunity and it’s commercial
opportunity and it’s commercial
opportunity and it’s commercial opportunities together with things like
opportunities together with things like
opportunities together with things like pollution but it’s mostly the commercial
pollution but it’s mostly the commercial
pollution but it’s mostly the commercial opportunities of fabricating
opportunities of fabricating
opportunities of fabricating manufacturing exporting this kind of kit
manufacturing exporting this kind of kit
manufacturing exporting this kind of kit in solar in wind and other sectors but
in solar in wind and other sectors but
in solar in wind and other sectors but led the Chinese to agree a comprehensive
led the Chinese to agree a comprehensive
led the Chinese to agree a comprehensive landmark deal with the Americans the
landmark deal with the Americans the
landmark deal with the Americans the year prior to Paris and now you see what
year prior to Paris and now you see what
year prior to Paris and now you see what we’re going to this right we’ve got
we’re going to this right we’ve got
we’re going to this right we’ve got China moving with ambitious
China moving with ambitious
China moving with ambitious decarbonization we’ve got the u.s.
decarbonization we’ve got the u.s.
decarbonization we’ve got the u.s. cutting emissions and we’ve got Europe
cutting emissions and we’ve got Europe
cutting emissions and we’ve got Europe cutting emissions that’s three-quarters
cutting emissions that’s three-quarters
cutting emissions that’s three-quarters of the world the rest of the world just
of the world the rest of the world just
of the world the rest of the world just has to pay attention because this is
has to pay attention because this is
has to pay attention because this is going to happen this is where the new
going to happen this is where the new
going to happen this is where the new markets are and it’s no surprise
markets are and it’s no surprise
markets are and it’s no surprise therefore that a year later you had this
therefore that a year later you had this
therefore that a year later you had this ambitious and comprehensive deal in
ambitious and comprehensive deal in
ambitious and comprehensive deal in Paris to try and limit temperatures to
Paris to try and limit temperatures to
Paris to try and limit temperatures to two degrees with an aspiration to keep
two degrees with an aspiration to keep
two degrees with an aspiration to keep them below one and a half now I saw
them below one and a half now I saw
them below one and a half now I saw quite a few of you or I sense quite a
quite a few of you or I sense quite a
quite a few of you or I sense quite a few of you straining there were that
few of you straining there were that
few of you straining there were that picture of a bomb and you’re kind of
picture of a bomb and you’re kind of
picture of a bomb and you’re kind of thinking under your residence right look
thinking under your residence right look
thinking under your residence right look at it now actually Donald Trump is
at it now actually Donald Trump is
at it now actually Donald Trump is another example of why the momentum is
another example of why the momentum is
another example of why the momentum is unstoppable ten years ago if the US had
unstoppable ten years ago if the US had
unstoppable ten years ago if the US had failed show leadership on this the
failed show leadership on this the
failed show leadership on this the Indians the Chinese and others would
Indians the Chinese and others would
Indians the Chinese and others would have said well you know what you’re one
have said well you know what you’re one
have said well you know what you’re one of the richest countries one of the
of the richest countries one of the
of the richest countries one of the biggest emitters if you’re not
biggest emitters if you’re not
biggest emitters if you’re not to be paying for this when we’re
to be paying for this when we’re
to be paying for this when we’re certainly not gonna handicap our
certainly not gonna handicap our
certainly not gonna handicap our economies to pay for this and the whole
economies to pay for this and the whole
economies to pay for this and the whole process would have stopped we’ve not
process would have stopped we’ve not
process would have stopped we’ve not seen that this time it’s been very
seen that this time it’s been very
seen that this time it’s been very different
different
different the US has talked about backpedaling
the US has talked about backpedaling
the US has talked about backpedaling China India Europe and the rest of the
China India Europe and the rest of the
China India Europe and the rest of the world I said well fine we’re gonna we’re
world I said well fine we’re gonna we’re
world I said well fine we’re gonna we’re gonna move on regardless with our
gonna move on regardless with our
gonna move on regardless with our voluntary agreements why because they no
voluntary agreements why because they no
voluntary agreements why because they no longer see this is of course they see it
longer see this is of course they see it
longer see this is of course they see it as an opportunity they see this as a
as an opportunity they see this as a
as an opportunity they see this as a chance to steal a march on the American
chance to steal a march on the American
chance to steal a march on the American competitors who are hamstringing
competitors who are hamstringing
competitors who are hamstringing themselves by slowing down and creating
themselves by slowing down and creating
themselves by slowing down and creating the new technologies and new goods and
the new technologies and new goods and
the new technologies and new goods and services for the fastest-growing market
services for the fastest-growing market
services for the fastest-growing market in the world all of this stuff all of
in the world all of this stuff all of
in the world all of this stuff all of this expectations all of these feedbacks
this expectations all of these feedbacks
this expectations all of these feedbacks these tipping points these understanding
these tipping points these understanding
these tipping points these understanding that you can invest in physical assets
that you can invest in physical assets
that you can invest in physical assets and that changes mindsets it changes
and that changes mindsets it changes
and that changes mindsets it changes cultures it changes institutions is what
cultures it changes institutions is what
cultures it changes institutions is what economists tend to miss out and so they
economists tend to miss out and so they
economists tend to miss out and so they they overestimate the cost of this
they overestimate the cost of this
they overestimate the cost of this revolution and like I said already they
revolution and like I said already they
revolution and like I said already they tend to underestimate the scale now
tend to underestimate the scale now
tend to underestimate the scale now don’t get me wrong
don’t get me wrong
don’t get me wrong economic models have a very important
economic models have a very important
economic models have a very important role to play they enforce a discipline
role to play they enforce a discipline
role to play they enforce a discipline on the modeler to be very clear on their
on the modeler to be very clear on their
on the modeler to be very clear on their assumptions they impose some degree of
assumptions they impose some degree of
assumptions they impose some degree of internal consistency and they’re good
internal consistency and they’re good
internal consistency and they’re good descriptions of the workings of the
descriptions of the workings of the
descriptions of the workings of the economy and so they act as very good
economy and so they act as very good
economy and so they act as very good sources of simulations for risks in an
sources of simulations for risks in an
sources of simulations for risks in an as if world what if things develop like
as if world what if things develop like
as if world what if things develop like this how might the world looked like but
this how might the world looked like but
this how might the world looked like but they useless at forecasting because all
they useless at forecasting because all
they useless at forecasting because all they tell you is the prior assumptions
they tell you is the prior assumptions
they tell you is the prior assumptions of the forecaster who makes the
of the forecaster who makes the
of the forecaster who makes the assumptions on the things you care about
assumptions on the things you care about
assumptions on the things you care about like I said at the beginning there’s
like I said at the beginning there’s
like I said at the beginning there’s plenty that economists can do to help in
plenty that economists can do to help in
plenty that economists can do to help in this story we can look at the risks we
this story we can look at the risks we
this story we can look at the risks we can try and help in assessing how much
can try and help in assessing how much
can try and help in assessing how much money should be put into research and
money should be put into research and
money should be put into research and development into deployment we can try
development into deployment we can try
development into deployment we can try and format formulate the standards and
and format formulate the standards and
and format formulate the standards and regulations we can help design our
regulations we can help design our
regulations we can help design our cities to make them more efficient but
cities to make them more efficient but
cities to make them more efficient but economists really need to learn the
economists really need to learn the
economists really need to learn the lesson but if they’re to stay relevant
lesson but if they’re to stay relevant
lesson but if they’re to stay relevant to this most important story they have
to this most important story they have
to this most important story they have to spend a lot less time trying to
to spend a lot less time trying to
to spend a lot less time trying to predict the future and a lot more time
predict the future and a lot more time
predict the future and a lot more time helping design it thank you
helping design it thank you
helping design it thank you you
”
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