Don't believe the hype

| 1st October 2008
The current economic downturn is hard, but it’s also filled with opportunities to remake the world in a more sustainable way, says Stephen Hale

The prospect of a global recession has given the opponents of environmental action a new lease of life. They claim, wrongly, that the downturn in the economy is a reason for politicians, business and the public to abandon the environment.

In fact, the downturn is a perfect opportunity for a radical transformation of energy, transport, housing and the economy.

The case for such a transformation has been building in recent years. Climate change and, to a lesser extent, other environmental issues, finally reached the top of the agenda in 2005, and they’ve been there ever since. Now it seems the media is tiring of it and wants to write a new story about the end of the ‘environment bubble’ – and the economic downturn has given it an excuse. Tellingly, the Guardian’s climate change summit in July was titled ‘Fighting climate change fatigue: how to keep stakeholders engaged’.

The media is currently peddling three dangerous myths. The first is that the downturn makes green choices unaffordable – but this downturn is partly driven by high oil (and gas) prices that now make some green alternatives such as energy efficiency, public transport and fuel efficiency much more attractive to drivers, home owners and businesses. However, without new incentives from government to take these actions, people are unlikely to make the change.

The second myth suggests that since the recession of the early 1990s led to a collapse in concern for the environment, the same must therefore be true today. That recession did squeeze the environmental agenda, but it was people’s inability to act, not their concern for the environment, that stalled it.

Today, public understanding, concern and ability to act is very different. Car clubs, recycling rates, Transition Towns, farmers’ markets and Freecycle are evidence from the real world that 2008 is not 1990.

Myth number three is that the public sees environmental issues as a luxury to be put aside in tough economic times. The evidence shows us otherwise. A poll for ICM in June found that, when asked whether, given global economic problems, tackling the environment or the economy should be the Government’s priority, 52 per cent said the environment and 44 per cent said the economy.

Corporate commitment is also far greater than in the 1990s. Company-facing companies such as Marks & Spencer and Tesco will doubtless trim when times are hard, but continued pressure from consumers and an increased framework of government regulation will help limit the extent to which they will abandon their green commitments in a downturn.

Oil prices are also stimulating energy efficiency in the private sector, and a rapid increase in investment in renewable energy and other low-carbon options. The oil price hike means energy investments that offer security of supply are seen as a safe haven. Europa says global investment in sustainable energy increased by 43 per cent in 2007. The Government is now talking of a £100 billion private sector investment in renewable energy, while a recent Climate Group study noted that China invested £6 billion in renewables during 2007, second only to Germany.

Real change in the real world

Never mind predictions, how is the downturn playing out in reality? The signs are that high oil prices are changing people’s behaviour.

At the time of writing, a 50-litre tank of petrol costs £59, a big increase from £48 this time last year. The AA estimates a two-car family would need to pay an extra £46.50 a month for the same amount of fuel. These prices are having an impact that transport policy has so far failed to make: two-thirds of motorists are cutting back on their journeys.

In addition, more people are shopping locally. Another recent survey by Populus showed that 29 per cent of motorists had cut back on trips to out-of-town retail parks and a third had even stopped driving to local shops, preferring to walk, cycle or take the bus.

As fuel prices rise, even North Americans are rethinking their habits. They drove 11 billion fewer miles in March 2008 than in March 2007 – a 4.3 per cent drop, and the first downward trend in 30 years. Public transport is growing as a result. There were 10.3 billion trips on US public transportation in 2007, the highest level in 50 years, an increase of 2.1 per cent. The hybrid market is booming, while SUV sales are plummeting. By 2015, hybrids alone are expected to make up one in 10 vehicles on US roads. The big US car manufacturers are struggling, and companies such as Ford are shifting investments into smaller vehicles.

Our holiday choices are changing, too. One sure sign is that budget airlines are suffering. Ryanair’s profits recently tumbled 85 per cent, EasyJet is cutting its capacity at Stansted by 12 per cent and Zoom has gone into receivership. Meanwhile, domestic holiday bookings at are up 12 per cent on last year.

Action now that helps now

These are enforced changes in behaviour, and they may not be seen all that positively by many of the people making them. It is for that reason that we need to create a society in which these and the many other changes we need to make are easier and more attractive to people. To do this, and to turn these trends into something far more positive and sustainable in every sense of the word, we desperately need strong political leadership.
Climate change makes this imperative, of course, but the threat of peak oil is another powerful driver. A recent New Scientist survey of oil industry experts found that most believe global oil supplies will peak by 2010. A 2005 report by the US Department of Energy argued that unless the world begins a crash programme of replacements 10 or 20 years before oil peaks, a crisis ‘unlike any yet faced by modern industrial society’ is unavoidable.

We’re in the crash programme zone right now, and that means we need radical action from government that helps people and businesses make these changes.

The high and rising cost of fuel and energy make efficiency a critical part of a politically sustainable strategy, and action here is one of the few areas in which governments can actually help families cope with rising prices. High oil price should be the springboard for an efficiency revolution at home, at work and in all forms of transport, and government should use its immense power to make this happen.

Many people can take the actions that make sense in a downturn, but it is the poor, who suffer most from high prices and rising bills, who are least able to act. A Labour government ought to be helping them with this, and it has belatedly got at least part of this message. While we can expect a push on energy efficiency from the Prime Minister after the summer break to help with winter fuel bills, this is likely to be piecemeal.

As the IPPR/British Gas initiative ‘Green Streets’ brilliantly illustrates, the UK has the potential to save more than £4.5 billion on energy bills, cutting energy use by 30 per cent and CO² emissions by 20 per cent. Spending an additional £500 million per year on 10,000 neighbourhood energy advisers would produce potential savings of £4.6 billion. The Government ought to be adopting the IPPR’s proposals now, as well as encouraging new green mortgage packages to pay for the installation of energy-saving technology.

Low-carbon is the answer

Given the potentially devastating impact of climate change, the long-term route out of the downturn will have to include a transition away from oil and towards a low-carbon future. This requires a seismic shift in energy and transport infrastructure and investment.

There are, however, some encouraging signs that the case for this is reaching the mainstream. Even that bastion of the global economy, the Organisation for Economic Co-operation and Development, now agrees with it. Its secretary general, Angel Gurría, said in a recent BBC interview that the longterm damage of the world doing nothing about greenhouse gases would far outweigh the short-term problems of the credit crunch.

An important attempt to sketch a green route out of the current downturn has been made by the New Economics Foundation in its ‘Green New Deal’, authored by economists and environmentalists including former Friends of the Earth director Tony Juniper, Guardian economics editor Larry Elliott and Green Party MEP Caroline Lucas. The manifesto calls for every home and office to become a renewable energy power station, for the creation of new green-collar jobs and a ‘carbon army’ to make the changes needed in renewable energy and energy efficiency. It also advocates an oil legacy fund supported by a tax on the windfall profits of the energy companies.

The May local elections and the state of the economy were widely seen as signalling the end of environment as a public and political priority. Immediately after the elections, Number 10 rushed to reassure journalists that it had heard the message and would drop the environment to focus on the issues that hard-working families really care about. Gordon Brown’s trip to Jeddah to plead for higher oil-production from the Saudis and other OPEC countries was a particular low point. Fortunately, he returned empty-handed.

The Prime Minister and David Cameron have both changed their positions in recent months. Gordon Brown is now belatedly focusing on some of the solutions that could get us out of this mess, with a far more aggressive push on renewable energy and energy efficiency (and also, wrongly, nuclear power). He was spurred on by a speech in June by David Cameron, in which the Conservative leader said the choice was not between economy and environment.

Cameron made a strong case for environmental policy as the way through current pressures, and made a commitment to a carbon standard for new power-generation. It was a much-needed statement of intent after a period of no significant Tory green initiatives. The Prime Minister’s rhetoric on the downturn has been markedly greener since, but continuing support for new  unabated coal power stations at Kingsnorth and elsewhere shows just how fragile such  commitments can be, and how far there is still to go.

Politicians must deliver
Environmentalists (Green Alliance included) worry too much about which political party will take up our cause and who might win the next election – the economic downturn is already making a bigger difference than anything that will follow it. The environmental movement in the UK has been critical in securing government actions, from the Climate Change Bill to the Renewables Obligation, but there is a long way to go, regardless of who wins the next election, and we will be bitterly disappointed if we simply sit back and wait for politicians to deliver.

To win the day, we urgently need to win the argument on two levels. First, ideology. Regulation and green tax are both out of fashion, but we will need to use both far more ambitiously to help make the necessary changes. Carbon trading alone is not the silver bullet the Government makes it out to be.

Second, we need the public with us. There are some tough challenges facing advocates of ambitious action; people are anxious about the economy and the impact on their lives of rising fuel, energy and food prices. Our job is to help them incorporate this new way of thinking into their day-to-day lives.

Some of the behaviours we want to encourage will cost more, and will seem out of reach. The ICM poll quoted earlier found that only 19 per cent of people said they would pay more for an environmentally friendly product. We have to demonstrate the bigger picture and the personal benefits of action now, and government has to support them to change.

Taking on the doom-mongers

We will face far more severe recessions than this if we don’t tackle the environmental crisis now. A world of runaway climate change would be far more traumatic than anything we have experienced so far. The global economy would be shattered by the cost of falling food production, environmental refugees and extreme weather events.

Whether this is a recession or a downturn, it can be the turning point. We can and must chart a better course and come out of this storm with a greener, more progressive and stronger economy, and a fairer society.

This can only be achieved by developing new arguments, making tougher demands on our politicians and developing new alliances. We’re on the right side of the debate about the future, so let’s take on the doom-mongers. They don’t know the way out. We do.

Stephen Hale is director of Green Alliance.

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