The Carbon Crunch [Kindle Edition]

The history of international attempts to address global warming can be traced back to the Rio conference of the early 1990s, which led to the UN Framework Convention on Climate Change. In the twenty years since Rio, agreements have been signed, targets set, laws passed and speeches made. Whole industries have grown up to tackle the problem. But for all the time and money that has been expended, the result so far has been utter failure. The unspinnable fact is that carbon emissions relentlessly continue to rise; the rate of increase is if anything getting faster.

Why? Who's to blame? What should be done? These are the three questions which lie at the heart of Dieter Helm's provocative and entertaining monograph.

The main reason for the relentless increase in emissions is, of course, the build out of coal burning power stations, particularly in China.

It is common therefore to hear China being blamed for the lack of progress on climate change. European leaders often point to the fact that emissions are falling in most European countries and argue that they are 'leading' on climate change, while implying that sadly nothing can be done about Chinese emissions.

Helm doesn't buy this smug European line. Take the example of Britain. Our production of carbon in the last twenty years has fallen; our consumption of carbon has not. Essentially we are outsourcing our emissions to China and other less developed economies. We let China pollute on our behalf, and then pretend it is nothing to do with us.

One of the key problems with the targets that have been set in Britain and Europe is that they focus on the wrong variable: carbon production rather than carbon consumption. These targets have been at best useless, and possibly even counterproductive: if the carbon intensive goods that are consumed in Europe are produced in China then the total carbon cost is even higher than if they had been produced using coal power stations in Europe due to the carbon used in transporting the goods here.

What should be done? Helm suggests a three pronged strategy. First, introduce a credible carbon price, which must include border taxes to choke off our consumption of carbon intensive goods from China. Second, switch rapidly from coal fired power stations to gas (which produces about half the emissions). Third, fund R&D into improved renewable technologies.

While Helm is optimistic about future renewables, he is scathing about the effectiveness of current renewable technologies and regards the subsidies to support them as deeply wasteful. Wind power, for example, is 'one of the most expensive ways known to man to marginally reduce carbon emissions' (p.76).

The Carbon Crunch was written quite quickly, and there are a few outbreaks of industry conference style talk about 'game changers' and 'level playing fields' (not to mention split infinitives: 'to marginally reduce' indeed: standards are slipping among the Oxford professorship). But it is a thought provoking book. It deserves a wide audience.

Helm has recently become something of a poster boy for the anti-wind farm lobby which prompted me to read this book. He's not however a climate change skeptic. Although Helm is convinced that we are heading towards potentially disastrous global warming if we don't do something to reduce emissions he's far from persuaded that our current carbon reduction strategies will be effective.The first part of the book gives an excellent overview of the problem we face dealing with carbon emissions around the world, particularly those from developing economies like China and India. Helm then goes on to critique current policy and lays out his own solutions to the problem.

While I don't agree with all his criticisms of current renewable energy systems you can't argue with Helm's passion. For anyone involved in renewable energy this book is essential reading, if only to understand the where the opposition is coming from. Nice and short too!

This is an extremely interesting book and should be read by all with an interest in combating anthropogenic climate change - particularly policy makers. It lays out the history of climate change talks from Rio, through to Kyoto and on to recent talks in Copenhagen and Durban, explaining why they are hailed as successes, even though they have produced little in the way of visible results. Helm also dispels many prevalent myths such as the potential contribution current renewable technologies and energy efficiency measures can make - typically vastly overstated by environmental groups. He comments on the damage which results from picking energy generation winners, such as spending enormous amounts of money on wind power programmes which can only ever provide energy intermittently and are therefore normally backed up by fossil fuel plants. This approach means that money is not being put into other technologies where we would get more bang for our buck. After clarifying why past policies have failed and current policies will have little positive effect, he sets out his own short, medium and long term plans to address climate change.

He rightly states that the first objective of every country is to stop using coal for energy generation. From a carbon dioxide perspective, coal produces roughly double the emissions per unit of energy production when compared to gas. Gas (e.g. CCGT) power plants are a well developed technology which can be built quickly and relatively cheaply. Increasing gas energy production would lead to a reduction in emissions, especially in countries like China and India. He correctly identifies why carbon taxes in the developed world are explicitly flawed, since manufacturing is increasingly being exported to the developing world along with the associated emissions. This penalises countries with a strong manufacturing base such as China and is part of the reason they are so reluctant to sign up to a global climate treaty which would limit their emissions. Helm cites a study which concluded that while UK emissions had officially dropped from 1990 - 2005, UK consumption of foreign products had increased so much that the UK caused a net increase of carbon dioxide emissions in that period. Many European countries claim similar victories.

There are gaps in this book. These are not gaping holes which cause his logic to collapse, but areas that I think should have been discussed. A key point is that his carbon tax is purely based on energy production. He expands this so that imported products are taxed based on the energy production ratio in the country of origin, but does not comment on other forms of emissions: energy is only one part of the puzzle. Deforestation was responsible for 17% of global GHG emissions in 2007 (IPCC). This should also feature on the carbon border tax, as should other factors such as whether the country uses progressive waste treatment technologies such as incineration or archaic solutions such as landfill.

Helm comments on The Stern Review, criticising the discount rate used, but never clarifies he thinks this rate should be.

His point that enormous amounts of public money has been put into low carbon technologies, such as windfarms, is well made. Politicians, with the help of lobbyists, have picked winners in the current scramble to reduce emissions. The result of this is that we have not reduced emissions as much as we could have and that we have spent far more money than we needed to. Spending this money in one area means that it is not being spent in another, probably more fruitful area. I agree that more money needs to go into R&D, but a lot of R&D ends up being fruitless and it is unlikely that R&D will produce a silver bullet. I think that R&D in tandem with executing more emissions reduction projects (including low carbon energy production) is a better solution, since most technological progress is down to incremental improvements which are made in successive installations.

Finally, increased gas use over coal and oil is proposed to reduce emissions, but energy security should also be part of this discussion. An economy which relies primarily on any energy source (be that coal, gas, nuclear, hydroelectricity, biomass or anything else) is at risk of experiencing a serious shock. I would like to see some figures on the percentage of energy he proposes providing from gas for a typical country.

Overall, an excellent and important book. A must read for policy makers and anyone interested in energy or climate change!