What’s a Carbon Trust? Why it’s the Pommy genesis of such radical, climate saving, innovative grants as a £198,910 research subsidy to replace spark plugs with a laser:
Unlike the venerable sparkplug ignition system, which fires just one or at best two sparks right next to the combustion chamber roof, it is possible to ‘aim’ a laser ignition system to ignite the fuel anywhere in the combustion chamber, therefore focusing the beam where the fuel is most concentrated.
Exhibit B: The Hogsmill Tavern Refurbishment. There’s got to be something about this kind of pissweak QUANGO to piss off everyone: Conservatives and various stripes of economic rationalists (so few grants would pass a cost-benefit analysis), Libertarians (moral interventions into the economy) and Greens (propping up unsustainable technologies with greenwash). Though with news that, just like every piece of environmental regulation before it (yes, shock horror, Christian, the CPRS is no exception), businesses aren’t ready for carbon trading, and a relentless stream of reports pointing the market failures around energy efficiency, maybe it’s a necessary – if stupid – evil. Whatever happened to building standards and ruling out redundant technologies (like coal)? Oh right: we need teh innovation to do it for us. What’s really going on here is one of those worst-of-both worlds compromises that characterizes Third Way thinking. Will Davies, as usual, provides the beef:
The preacher’s – and profiteers – of ‘change’ take Schumpeter’s material-economic analysis and transform it into a discursive-cultural one. The gospel they sell their clients implores them to delay or out-source real ‘creative destruction’, and replace it with rhetorical, managed, normal ‘change’. As Bob Jessop notes, the 1980s and 90s saw a pronounced attempt to internalise and normalise Schumpeterian principles in Western economies – a paradoxical venture, given the external, abnormal nature of the Schumpeterian entrerpreneur. But if change can be normalised and instated as the founding constitutional principle of an organisation, then, it is hoped, that organisation can avoid being destroyed by the very forces it claims to believe in. A weird bargain is struck: as long as change is worshipped, witnessed and celebrated everywhere, things can remain largely the same.
I’m also reminded of the Lisa vs. Malibu Stacy episode of The Simpsons, where the inventors of Malibu Stacy foil Lisa’s attempt to introduce a positive, affirmative doll to the sexist marketplace only to have its launch foiled by a Malibu Stacy with a new hat: “She still embodies all the awful stereotypes she did before!” Smithers is quick to point out, “But she’s got a new hat!”
Update: Just to clarify, I’m not against efficiency or the government correcting market failures. But, as richard has argued:
Lets go back to the beginning of why we (allegedly) wanted to go down the emissions trading path – if we got the price signals right it would be simple and elegant and we wouldnt have to worry about all that inefficient regulation and government spending…
and where are we now? apart from pathetic targets and enormous compensation we have the government spending billions of dollars on solar, billions on clean coal, billions on insulating our houses, lots of new regulation on energy efficiency…all good ideas, but all a bit pointless when you have already proposed to cap the level of emissions. We have wound up with the worst of both worlds.
The only way you can make sense of the CPRS is to look at it as a mechanism for protecting Australian polluters from the costs of tackling cliamte change. There will be no avoiding the costs to the Australian people and the Australian economy, but if the government can sneak the CPRS through before people really understand what it is (and what it isnt) then the polluters will have secured their certainty at our expense.
Remember how the farmers locked in their ‘rights’ to water just before the water ran out? well the polluters are following the same strategy, and the only thing that stands between them and avoiding responsibility for another 11 years is the Senate.
but…but… lasers make everything better
Sounds like it’s a loan scheme to reduce the use of energy in buildings. Are you against that, dk.au?
Not convinced on the substantive point, but I did find it amusing that the managing director of the British Carbon Trust has the unfortunate moniker of…Tom Delay.
Which I gather is what you think bodies like this have been set up to do, dk
Wow, that looks terrible…
The whole idea of capitalism is to reward companies/individuals that change/adapt/innovate quickest for the least cost. This looks like the absolute oppisite. Pick the biggest bloated most whiney and give them money to go slower.
As you say something bad for everyone.
Is this a Manhatten Island deal? Lots of low value but sparkly and interesting eco bling to buy off public perception, a kind of Jedi-like environmental hand wave for the weak minded? “Global Warming is under control”…..”Global Warming is under control”. “You should go home and rethink your life”….”I will go home and rethink my life…..”
Did I read correctly somewhere, that he will be encouraging households to offer up their savings from any energy efficiency programs they might undertake?
Goodness me, what a terrific idea! I expect there will be a frightful rush to queue up for that one…
More spin, political fairy floss, and symbolism.
How many more non-productive public servants can Rudd pile onto this flimsy platform?
Yep, here it is:
“The Energy Efficiency Savings Pledge Fund will provide a web-based calculator so that households can calculate their energy use and the dollar savings that result from energy efficiency activities,” Mr Rudd said.
“Individuals will be able to pledge the resulting savings, or any other amount, to the Pledge Fund to buy and cancel carbon pollution permits. This will enable individuals to directly contribute to achieving Australia’s emissions reduction targets.”
I did find it amusing that the managing director of the British Carbon Trust has the unfortunate moniker of…Tom Delay.
You mean the Tom Delay who was indicted for fiddling campaign funds and implicated in other scandals? the one who accepted donations from USSR oil companies? The one who referred to the American EPA as “the Gestapo of Government”? The opponent of public transport and environmental regulation? The crusty Republican apparatchik and friend of Newt Gingrich? That Tom Delay?
Yes, very amusing. It doesn’t bode very well at all for this mickey mouse-appearing outfit.
People, please. The CPRS is supposed to be a carbon price that will take care of these market failures. To be a little less obtuse: what is the point of the CPRS if we’re going to keep implementing programs that undermine its basic premise? (see update)
It’s a serious question: why should I, as a citizen – not shareholder, lobbyist etc. – support the passage of a bill that is handing over such a vast amount of public money with such flimsy promises attached?
Elise, the pledge fund is a different program aimed at households.
Actually DK, the carbon price doesn’t take account of the various information failures/asymmetries that can prevent households and firms from using energy efficiently.
And I cannot remember anyone in the ALP in the run-up to the last election saying that if you priced carbon it would mean avoiding having to use any other regulatory mechanism. Indeed, Rudd promised complementary demand management policies as one of the pillars of his strategy for tackling climate change.
Most specialists in this area sees carbon pricing and targeted CAC mechanisms that pass cost-benefit tests as complements, not substitutes! Of course we can argue over whether this particular idea is meritorious, but I’m surprised you problems with the general principle.
I guess your main problem is that you see things like this as akin to putting lipstick on a pig…
Discussion all over the place. Must admit I tuned out somewhat after reading the comment of Grumphy@1. My train of thought was caught up in wondering whether Grumphy might be interested in an old laser I’m trying to offload. It’s had many alterations to the original, bits added, bits taken away and bits decayed by erosion of time. Nothing like the bright new shiny Laser I drove away in 1986. What about it Grumphy – it’s going cheap. Come to think about it there are many parallels with the CPRS issue. Hmmm….wonder what kind of car Robert Hill drives. Perhaps he might be interested. Oh, ROBERT please ring if you are. Cheap at twice the price.
Fair cop, Labor Outsider. Even Wilkins recommended a “independent investment vehicle to be called the Carbon Technology Trust” right before suggesting we get rid of those pesky ‘regulatory barriers’ to CCS. For Wilkins, it was a question of emphasis: “The point of emissions trading scheme is not to raise revenue but to change relative prices and create an incentive for that transformation to occur.”
But you really have to wonder the point of a body designed to ‘accelerate our transition towards a low carbon economy’ if all these measures won’t make any direct difference to our national emissions because the emissions cap is also a floor. I mean, will it actually mean that ‘it will make it easier to set a lower cap in the future’ as the minister has promised? What kind of metrics would ensure that promise isn’t just a hollow one? There’s a bigger question here: at what point does top down regulation like national emissions trading become a toothless waste of space and more direct, punitive measures become necessary?
DK, I guess this is how I think about it.
There is a lot of misinformation about the costs of moving to a near-zero emissions economy. And those costs are almost certainly greater in the short-run than in the long-run because we have a capital stock that has adapted to relative fossil fuel prices that don’t internalise the externalities.
If governments can demonstrate over time that they were able to make measurable reductions in our carbon intensity and emissions at low and barely noticeably cost to consumers and most firms, then it should be much easier to set more ambitious targets in the future.
As I have suggested before, there is no real problem with the emissions cap being an emissions floor if the cap itself is aligned with what will be necessary to significantly reduce the probability of dangerous climate change. In that world, one simply wants to find the most cost-effective way of achieving the cap.
While I’m not happy with many elements of the design of the ETS, and think the targets could have been a bit more ambitious, I also think there is tremendous value in commencing a scheme, demonstrating that it can work without much economic dislocation, and then improving its efficiency over time.
Remember also that punitive measures also have to come out of a democratic political process so if you’re unhappy with the shape of the CPRS I’m not sure there is much reason to expect you’ll be happy with what CAC mechanisms they dream up should it fail…
That world sounds lovely. Do you know when the shuttle leaves?
Seriously though, I don’t see how the kind power (well beyond any individual) wielded by Multi-Nationals over the modern state and mass-mediated publics resembles – even remotely – the assumptions of classical liberalism. Compare the pathetic press release journalism I’ve documented in Emo Watch with any substantive ideals of a public sphere. How many consult public-interest advocates?
I know punitive measures would have to be democratic too. But I think we need a different kind of state to deal with the problem Anthony Giddens has humbly called the ‘Giddens Paradox’
Anyway, I appreciate your comments, LO. Just struggling (like many) to reconcile people’s advocacy of emissions trading-as-experiment with the abysmal scheme design before the Senate.
In the update to the main post, the criticism by “richard” of current climate policy enumerates these supposed defects: “pathetic targets”, “enormous compensation”, billions to be spent on specific technologies, and “new regulation”.
I won’t quibble regarding the targets, though I have to regard even 2020 targets (to say nothing of 2050 targets), announced in 2009, as rather theoretical. One would hope that these big companies planning multi-decade projects understand that the 2010s are going to be hotter than the 2000s, just as the 2000s were hotter than the 1990s, and that the future will not feel bound by 2009’s definition of political realism. But:
1 – To my knowledge the “enormous compensation” consists of certain emitters (the EITEs) *not* having to pay for their emission permits. It irks me to see this described as compensation. No-one else is paying them a cent (especially since this is all revenue-neutral); they are merely getting to keep some of the money that is already theirs.
2 – That specific technologies should be federally supported, and new regulations enacted, even as emissions trading is introduced, is apparently regarded as a defect, because emissions trading was supposed to solve the problem without any further government action being required. Maybe I’ve just become too open-minded in the wake of the GFC, but the mere fact that a market-based policy is combined with regulation and direct expenditure does not inherently strike me as a flaw. Yes, emissions trading may have been *portrayed* as a hands-off self-sufficient solution, but recent experience should make us skeptical about whether governments can delegate everything to the market, even to markets they have designed and created themselves, and still expect to see their agendas realized.
If you have a carbon-intensive economy, your aim is a low-carbon one, and the transition isn’t happening by itself, as a government you have two basic methods of inducing change, direct and indirect. The direct method is where you allocate the money yourself, nationalize the power stations, etc. The indirect method is where you change the incentive structure and hope for the best. It isn’t surprising that the methods actually being adopted are a mix of the two extremes.
I am still waiting for someone to find a specific opportunity for reducing nett emissions for which CPRS or some other system for putting a price on carbon is more effective than some of the alternatives. While we are waiting for this minor miracle it might make sense to get on with the serious business of doing something about the significant opportunities that don’t depend on technical breakthroughs.
For example, we can get on with reducing the carbon footprint from new buildings, cars etc by the use of regulations when appropriate. We can also get on with encouraging large investments in clean alternatives by negotiating price and sales guarantees for the clean alternative. (More price effective than the converse approach of puting a price on the dirty alternative.)
However, both the examples given above have their limitations. It is much harder to use regulations to drive the clean up of existing buildings and cars. It is also harder to use price and sales guarantees to encourage investment in rooftop solar panels, insulation etc. Action in these areas is going to require strategies such as subsidies, special campaigns, data on what could be saved by doing X etc.
I guess I share DK’s fear that the government trust will be just another bit of environmental bling that gives the impression that something is being done without acheiving anything. However, it does have the potential to be a tool for identifying small scale low cost opportunities for reducing net emissions. It also has the potential to be an agent for sorting through the innovations coming up out there that could have a real impact in Australia.
The danger is that the carbon trust will fall into the trap of being the supporter of the last resort. I have no idea re the merits of laser spark plugs but I have to suspect that this would be an example of what I am talking about.
In the meantime the government should put the CPRS on hold and start thinking what its answer will be when they are challenged at the next election to demonstrate that they have actually reduced emissions more than Howard did in his last term.
Who knows – laser spark plugs might by better focusing and controlling ignition make for petrol engines that run closer to their Carnot efficiency. It’s probably worth a small grant to explore the idea.
On the wider issue of the usefulness or otherwise of a “Carbon Trust”, I’ve no idea. But on the face of it does sound like the sort of symbolic substitute for effective but politically painful action that pollies are ever prone to.
… and not one word about the fact that Robert Hill is a War Criminal? LP rocks on.
Good to see you back gandhi, but you better be careful. Don’t criticise the Catholic church on a post about Tony Abbott’s views on divorce (WTF?), remember that uranium mining is a good thing and all but inevitiable, and don’t you dare criticise farmers.
But you should feel free to comment on the cricket without much approbation.
disapprobation, perhaps?
John D “However, it does have the potential to be a tool for identifying small scale low cost opportunities for reducing net emissions. It also has the potential to be an agent for sorting through the innovations coming up out there that could have a real impact in Australia.”
I agree, it has this potential and therfore it needs trying out, rather than blanket derision. It may be very small-scale, but it surely cannot INCREASE C emission? So it may be “one small step” for (hu)mankind. Every small step is a step worth taking I think.
What care I for neo-Schumpeterian discourse? There are C emissions to reduce, ladies and gents.
This is going to piss off everyone? Economic rationalists, Libertarians and Greens – is that everyone? What about social democrats? We probably make up a bigger chunk of the electorate than all three of those groups combined.
This social democrat thinks it’s a good idea.
is it online anywhere? i missed it. anybody?
whoops! that was meant to go in the ‘liberal rule’ area. as you were.
P.S. Unlike Howard who purged the senior public service of anyone who had the slightest taint of being ideologically incorrect, I think what Rudd is doing is very smart.
This tactic has been used by a lot in the US by presidents and governors – and it is devastating. It makes you look statemanlike and open-minded, avoids “jobs for your mates” accusations, and is demoralizing to your opponents. It makes it harder for oppositions to get stuck into “one of their own” too.
Has to be used with care, though.
Ginja, you shouldn’t forget the ABC’s (and presumably News Ltd’s) ability to turn anything that Rudd does into a negative. On the ABC this morning it was being characterised as a political appointment with the sole motivation to minimise the opposition’s ability to criticise the government. Or something.
blockquote> … a political appointment with the sole motivation to minimise the opposition’s ability to criticise the government …
But I reckon that’s exactly what it is, adrian. Unfortunately, Rudd has learnt a lot of lessons from Howard, and (frighteningly) he’s even more effective at wedging the opposition than Howard ever was.
poop.
Ginja, I don’t think I have ever read a criticism of Rudd government policy on this blog from you. I’m going to assume that you are an ALP member. But even then it is strange. In over 15 years of ALP membership nearly every activist I spoke to has some problems with aspects of ALP policy. Is it that you think that party policy needs to be defended on the blog? Or were you and the Ruddster separated at birth and you really do think that all his policy ideas are great?
David, I would argue that it’s not the sole motivation, but anyway it’s not something that Howard did, as he was too consumed by hatred to allow anyone with even vaguely Labor leanings to be given anything approaching a position of power.
You just get the feeling sometimes that with some people Rudd simply can’t do anything right. Had he given the position to a Labor insider he’s be criticised as well. If he’d given the position to someone with no political affiliations he’d be criticised for some other reason.
If Robert Hill is a war related criminal get used to grimacing about Labor too.Or hasn’t anyone noticed,within the ALP as members and outside as voters.What are we doing in Afghanistan!? And Iraq still!On the matter of the Carbon Trust..if there is a need for an organization like this..what legal entity form is required!? Robert Hill could also surprise,even though I am opposed to Carbon Trading and cap stuff,the reason why Robert could surprise is like ex-N.S.W. Premier who took over the anti doping matter up within sports.He is making a fair fist of it,without a camera up his arse.I think however, the people I saw on the video,as much as I could stand it,are just simply overstating the matter,and,I doubt very much,if the business communities of Dear Old England haven’t thought about the issues.Really!?Sounding intelligent about what you are wanting to achieve,is normal ,and sometimes unrelentingly so.There is nothing wrong with the spark plug research,that may have many spin offs,yet to be determined.And spark plugs are very useful things,and may play some other role within the car of the future,even more effectively than present.After all its nature as an invention is directly electrical,and thus,maybe, transferable even into present building design.Neither Lasers or spark plugs are loser technologies so, forget that snipe,it isn’t worth it.
The above isn’t what I typed.Spark plug research was supposed to mean laser, and both types of products are not losers.I need a word audio thing whilst I finish a word.Where do I get one of those!?
Labor Outsider@29 a bit below the belt IMHO.
Agreed joe2. A strange and unwarranted comment.
…I meant statesmanlike in previous post.
Labor Outsider: it’s good to see you’ve torn yourself away from your dynamic stochastic general equilibrium models – or whatever it is economists do for fun – to join us.
Look, it’s true I defend a social democratic viewpoint fairly consistently. And we just happen to have a social democratic government at the moment. But I do it for a simple reason: very few others do it.
It’s my educated guess that those suscribing to a broadly social democratic viewpoint make up about a quarter to a third of the electorate. Yet you wouldn’t guess it reading the press or blogs. This very blog is a good example – apparently “everyone” doesn’t include that huge chunk of the electorate.
As an ALP member, I would have thought you would have picked up on that.
I hope I’ve never engaged in intellectual dishonesty to defend a Labor policy. Any previous stoushes we’ve had on policy I would still defend (that seems like a fair gauge of integrity).
Also, I like annoying Green supporters.
…..but you’re a worthy foe, Labor Outsider.
Carbon Trust UK
The trust is a Taxpayer supported fund which essentially provides interest free (repayable) loans/grants to the business sector and others, for the purpose of upgrading and or replacing energy inefficient lamps and lighting equipment with latest energy saving products.
Repayment is funded via savings resulting from the upgrade.
EG: Where a company elctricity account for lighting was formerley
$30,000 pa
After upgrade and retro-fitting work is completed the account is reduced to say
$ 15,000 pa
Then repayment will be set at a max of $1250 pm until the loan/grant is totally repaid.
While an average loan/grant maybe be rapaid within 2 years other bigger projects may be from 1 – 7 years.
The key point is that as each project is completed repayment commence after the 1st month and so on.
So immeadiately the trust is instantly able to recycle $$$ perpetually ( perpetual motion if you like )
Thus this Carbon trust loan/grant scheme is perhaps the most instant and efficient form of assisting the country reduce electricity consumption and Greenhouse gas emission in one strike…!!
.
1kwh of electricity saved equates to approx 1kg of GHG emission
.
Think about it
Carbon Trust Australia
If based on the Carbon Trust UK scheme, Rudds approach may revolutionise the energy efficiency of commercial / industrial and community premises here.
The cost to the Taxpayer is in reality absolutely zilch…
Essentiall the funding of upgrades to lighting equipment and retro-fit lamps is a simple equation.
Before upgrade electricity consumption is X
After upgrade electricity consumption is Y
The saving due to upgrade provides the funds to meet the cost of the same.
Realistically a modest interest rate should be charged to cover wages of carbon trust staff and administratiobn of the scheme.
This in itself further insulates the taxpayer from funding those legitimate costs and indeed would eventually mean taxpayers initial funding could be retrieved in full, while the scheme would continue to grow, as a say ( its the closest I see to perpetual motion )
So who is to be the loser? The power generator or electricity wholesalers??
IF the power generating companies wish to maintain current or increased output to meet current/future demand, they will have to fund substatial infrastructure and higher maintenance costs etc.
But increased output means increased carbon emission.
Result:
Risk of additional and unsustainable financial penalties.
.
Electricity wholesalers are the ones likely to feel a crimp due to
the fact that lighting upgrades drastically reduce consumption.
Reduction can be up to 2/3 of existing monthly account.
.
EG: A major logistic company next door to us, uses 400 x 456watt MV lamps (very inefficient and highly hazardous ) operating 24hrs x 365 days.
For lighting alone that little lot equates to consumption of approx:
1.6million Kwh/pa @ a cost of around $192,000 pa
.
A retro-fit project undertaken for these premises would result in:
Energy savings of around 1,000,000Kwh pa and around $ 120,000 pa.
GHG emission saved equate to around 1000 tonne pa.
Cost to implement: approx $ 300,000 + interest say 10%
ROI = 3years.
Thereafter the company pocket savings of $120,000pa. Had the upgrade not been implemented, the annual tariff increases of say 10%pa would likely show that the initial saving of $120,000, becoming 159,000pa after 3years.
Which is to say that the annual account of $192.000pa now may increase @ 10%pa resulting in annual an energy bill of $255,552 3 years later.
In not upgrading for 3yrs the company will have needlessly wasted
> $300,000. of profits.
Ohh and they would have emitted another 3000 tonne of GHG in that time.
This is but one real live example. All be it a major one, but next time you go to bunnings or officeworks or DFS, glance up and count the Highbay lamps.
.
Its likely few if any any upgrades have been done recently because most major companies with numerous oulets are awaiting start of this Carbon trust scheme.
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Other countries have had such or similar schemes successfully in operation for years.
Its past time we had the same incentive.
.
The loan or grant is to be subject to standard commercial approval criteria and repayment schedule.
There are few if any certainties in life, and there are few gov schemes which succeed delivering real benefit to the average bear, but this system is so simple it is virtually impossible to corrupt or fail.
It should be win, win, win, For the Taxpayer, for the consumers and for the community as awhole.
.
Ohh and the energy wholesalers… Well wont they just add a bit to their fees to cover some loss..
I may well stand corrected and so seriously welcome any comment, pro or adverse
thanks