What is to be done? — this was the title of the pamphlet by Vladimir Lenin in 1902. The key message of the pamphlet was that the proletariat (workers) will not be able to wrest concessions from their employers regarding working conditions and wages unless they organised themselves into a “vanguard of dedicated revolutionaries”.
I thought of this pamphlet while ruminating about global warming recently. For, this is a challenge that cannot be tackled without such a vanguard, at least in my view. Everyone other than the most diehard of contrarians agrees that global warming presents an existential crisis. More pertinently, they accept that solutions exist for curbing carbon emissions. People, however, differ on “what is to be done” to bring such solutions to scale. The problem is that the planet is fast exhausting its carbon budget. Time is running out.
It is against this backdrop of ruminations that I found the book Climate Capitalism: Winning the Global Race to Zero Emissions by Akshat Rathi refreshingly comforting.
Rathi is an optimist. His book is about interventions in the clean energy space that made a materially positive difference. He writes about these interventions under pithy two-word chapter headings that encapsulate the drivers for scaling up green solutions.
Rathi is not a market fundamentalist. He does not whitewash the contribution of “unfettered capitalism” to global warming. On the contrary, he quotes the admonition by the economist Nicholas Stern that “not pricing in that negative externality has been the greatest market failure of all time”. But, as the title of the book suggests, and his stories establish, he holds the view that carbon emissions can most effectively be curbed under the canopy of capitalism, albeit under a patient and reformed capitalism, designed to respond to the longer lead times associated with climate economics.
Chapter 2 is titled ‘The Bureaucrat’. It is about Wan Gang who, after a stint with Audi Motors as an engineer/designer, returned to China to evangelise the transition from internal combustion engines to battery-operated Electric Vehicles (EVs). Wan was the Minister of Science and Technology. He leveraged his bureaucratic clout and technical expertise to empower entrepreneurship and incentivise public and private investment into EVs. He was successful. It is estimated that between 2009 and 2017, he was able to channel approximately $60 billion into the sector. Wan is the reason China is today the world’s leading manufacturer of EVs.
Chapter 3 is captioned ‘The Winner’. Here too the subject is Chinese — Zeng Yuqun, the founder/CEO of Contemporary Amperex Technology Co., Limited (CATL) — currently the largest manufacturer of lithium ion batteries in the world. Zeng’s success derives from multiple factors, but the two most relevant are his focus on domestic R&D and his skill in managing partnerships with western car manufacturers (original equipment manufacturers). The former is the reason CATL has upended US’ first mover advantage over battery technology; the latter the reason for its rapid penetration of the market.
Chapter 5 is ‘The Fixer’. Fatih Birol, the executive director of the International Energy Agency (IEA) may not be happy with the appellation, but the chapter is about how Fatih navigated the geopolitical and geoeconomic tightrope of the energy transition to stretch the mandate of the IEA from “caring about carbon underground” to caring about it “everywhere”.
The IEA was set up in 1974 in the aftermath of the oil crisis of 1973 to help industrial countries manage oil supply disruptions. Its mandate was energy security. Not surprisingly, the stretch to caring about it everywhere has attracted criticism. But, Fatih is unfazed. His response (as conveyed by Akshat) is, “there is a growing gap between the people who care about climate issues and those who care about energy issues”. His priority is to “bridge this gap”.
Whether he succeeds or not remains to be seen, but what Fatih and his team of technocrats have achieved so far is to heighten the sense of urgency with regards to the energy transition and to provide empirical data, climate scenarios and tools to countries struggling to mitigate and adapt to global warming.
Chapter 6 is ‘The Billionaire’. It is about Bill Gates and his multibillion dollar fund “Breakthrough Energy Ventures” (BEV). The fund incubates start-ups that are experimenting with technologies that can potentially reduce GHGs by at least 500 million tons when operating at full scale. Gates is hopeful that by reducing risk, BEV’s seed investments will trigger the flow of additional private capital. Gates knows, however, that money can at best fulfill the necessary conditions for a successful scale-up. It is not sufficient.
What is also required is the creation of a market for “green products” and innovation. To achieve these objectives, Gates has leveraged his name and network to lobby for a policy ecosystem that, at one level, reduces the “green premium” attached to green hydrogen, sustainable aviation and carbon removal through tax credits, carbon pricing and regulation and at another, stimulates innovation through non-monetary support.
The book contains several more stories. ‘The Reformer’ is about the CEO of a US oil MNC who is investing cash generated from the production of oil in carbon capture. ‘The Enforcer’ is about a Danish energy company that through “accident, timing, policy and entrepreneurship” has become the largest offshore wind farm company in the world. ‘The Campaigner’ is about politicians, bureaucrats and climate activists campaigning for legislation and organisational change to accelerate the pace of decarbonisation and ‘The Capitalist’ is about companies whose strategies have balanced investments in solutions to solve global warming and profitability.
These are disparate stories linked by the common thread of success in shifting the needle of climate policy in a positive direction. Their progenitors are not revolutionaries but they do represent the vanguard of change. More importantly, their experience provides pointers for answering the question “what is to be done”. All of the above stories are built around the drivers of leadership, policy, technology, entrepreneurship and collaboration. And subject to the proviso power and politics, are supportive of the direction of change.
The writer is chairman and distinguished fellow, Centre for Social and Economic Progress
All of the stories are built around the drivers of leadership, policy, technology, entrepreneurship and collaboration
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01.04.2024
What is to be done? — this was the title of the pamphlet by Vladimir Lenin in 1902. The key message of the pamphlet was that the proletariat (workers) will not be able to wrest concessions from their employers regarding working conditions and wages unless they organised themselves into a “vanguard of dedicated revolutionaries”.
I thought of this pamphlet while ruminating about global warming recently. For, this is a challenge that cannot be tackled without such a vanguard, at least in my view. Everyone other than the most diehard of contrarians agrees that global warming presents an existential crisis. More pertinently, they accept that solutions exist for curbing carbon emissions. People, however, differ on “what is to be done” to bring such solutions to scale. The problem is that the planet is fast exhausting its carbon budget. Time is running out.
It is against this backdrop of ruminations that I found the book Climate Capitalism: Winning the Global Race to Zero Emissions by Akshat Rathi refreshingly comforting.
Rathi is an optimist. His book is about interventions in the clean energy space that made a materially positive difference. He writes about these interventions under pithy two-word chapter headings that encapsulate the drivers for scaling up green solutions.
Rathi is not a market fundamentalist. He does not whitewash the contribution of “unfettered capitalism” to global warming. On the contrary, he quotes the admonition by the economist Nicholas Stern that “not pricing in that negative externality has been the greatest market failure of all time”. But, as the title of the book........
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