If everything was decided on cost and efficiency, then we would still have slavery (to extra-polate matters a lil) because it was convenient to all and required “sacrifice” to find alternative means i.e. technology to do their work. I also repeat that the playing field for energy sources is not level with a strong oil lobby that would squelch any exploration of other alternatives. If you are not aware, Ford and GM bought patents that would have increased fuel efficiency tremendously and then simply let them languish and now are ruing the fact that they are losing customers to Toyota’s Hybrids. Unfortunately, it is a tad late and Detriot is on the brink of bankruptcy.

If preserving the environment and hoping for a sustainable planet is considered as sacrificing cost and efficiency, then I suppose we have our priorities wrong.

I am not saying that the markets and the people ushered in CNG. And notice, I said “comparitively easy”. I know the court ordered, and the government stalled and all that. But the fact remains that the change has been sustained because running vehicles on CNG does not affect the cost and efficiency too much in the long run. If instead the court had ordered those electric ‘tempos’ that chug along at 25-30 kmph and take hours to charge, the change would not have been sustained. And I don’t think the Supreme Court would have ordered it either.

Pollution and Global Warming are two separate issues, though not mutually exclusive. The SC’s judgement was more in tune with reducing the pollution. I do not recall there being an element of “global warming” in it.

I am not saying that we should sit on our hands and keep drinking oil. We should, and will shift to other fuels, but not at the cost of economics and efficiency. And yes, we “should” try to innovate, but you would know realistically how deep our pockets need to be to actually come up with a full scale alternative.

India is doing its part for sure. Suzlon is a great private sector initiative in wind energy, though recently they’ve been involved in some controversy of a different nature.

Anyway, my point was that idealistic measures which require “sacrifice” are not going to work. No matter how much consensus is built on global warming. The measures need to be such that cost and efficiency are not sacrificed. Third time I am repeating it, but well, it bears repetition. :D

is a Manhattan Project-like drive to achieve oil independence. Space travel wouldn’t have been possible if only market forces were allowed to operate but then we all are enjoying its spillover effects in form of a large technological jump.

Great point – I was trying to make a similar point, but glossed over it. The other good example is the Human Genome Project – while the main objective was sequencing the human chromosome – both the public and subsequent private enterprise by Craig Venter has produced many technological innovations of immense benefit to the biological sciences on the side. We probably need a multinational effort on similar lines for a technological breakthrough in the field of energy efficiency.

The West can and should lead the struggle against pollution not because they created the problem but as you mention, they have the resources and technical skill to do so. So does that mean that if they share those resources and technical skills with developing countries like India and China, they have no reason to opt out? Arguing that there is no other way to progress other than rampant industrialization that pollutes is misleading. Alternative energy sources like nuclear and methanol are not as polluting as their nonrenewable counterparts and often the choice to move is more political than economical. Public subsidies have manipulation of the market has kept the prices of fuel low. If free market was allowed to operate, it would be impossible to drive a car economically.

Gaurav B, I do not suggest that market mechanism is not appropriate for this problem. I am just suggesting that market in its current form is not helping much. The environment is unfortunately treated as a public good and in short-term economical terms, it doesn’t amount to much. By the time, it is a problem we blame our ancestor and cry out, not fair…just like developing countries are doing now. The cycle goes on.

Of course, remedial measures can be piecemeal but such efforts can only be bolstered by subsidies similar to the way fuel was promoted when it was perceived to be abundant. Like I commented above, if pure market was allowed to exist, then gas prices would be through the roof. At what point do you stop driving your car? Those prices are in effect in Europe.

I guess what Confused is alluding to is a Manhattan Project-like drive to achieve oil independence. Space travel wouldn’t have been possible if only market forces were allowed to operate but then we all are enjoying its spillover effects in form of a large technological jump.

You mentioned about CNG being adopted in Delhi because the cities were getting unbearable to live in. Atleast in Delhi, the CNG conversion was ordered by the Supreme Court. How did the govt react? It went to the Supreme Court, keep begging for more time-in short as usual buckled down to pressure groups. I still remember the bus strikes in Dekhi during those days. It was only because SC refused to stand down, monitered the situation to the extent of ordering the IGL to open new CNG stations, the situation changed. So it was not market which decided that the cost of pollution was too high and took remedial measures, it was the Courts.
Just one article, a more detailed search will give you plenty other articles.

http://www.hinduonnet.com/fline/fl1808/18081190.htm

I am not sure about Mumbai, but as far as I remember the CNG conversion was ordered by the Mumbai High Court.

As far as India and China goes, I agree that ideally US should lead the development of new sources of energy. It has the money and the scientific talent for it. Unfortunately, the Bush administration does not have the guts to taken on the Oil lobby. Who wants to invest money when cheap gas is available? Even in real term pricing, gasoline is about the half the price in US compared to India.

Why cant India try to develop new sources of energy? I know it is a diffcult challenge and it is much easier to maintain the status quo, but at the same time it is a huge oppurtunity. The reason why US is the richest country in the world is simply because all technological innovations seem to come from her. How about India? Atleast let us give it a shot while US sleeps.

About you not being sold of global warming, that is a seperate issue. I suggest some more readings on the subject might help you in changing your opinions.

regards

Just a general point, but before that let me make my declarations: “I am a global warming skeptic” but “I like the idea of cleaner air/water for its own sake.”

You mention that markets are not the best way to handle this problem. No matter what government actions take place, the only viable way to effect changes in people’s real behaviour is the information passed on through prices. If trend prices are low, people will use more of that thing, as trend prices rise two things happen. First people might start conserving their usage, using better more efficient machinery to do the same jobs. The other is that the alternatives to oil will become commercially viable, and so will research into making these alternatives cheaper. Hydrogen for instance seems promising.

Looking at it this, one could argue that India and China raising their demand for oil has helped make alternatives viable. I think that would be a bit of a logical leap, but high oil prices certainly bode well for those concerned about a clean environment as well as those who fear global warming.

Although I think Kyoto-style political solutions are overambitious and unworkable. I think there is a problem with arguing that developing countries necessarily must follow a dirty path to development. I think it is entirely possible, given high trend prices for oil for India and China to develop cleanly. I am fairly sure that our current industries are cleaner than those in the developed world at comparable stages of development.

Any shift towards such “greener” measures is thus going to happen only if it is selfish like it was in Delhi and Mumbai. A “wise” choice which you hope future generations will make can work only if the “wisdom” shows some direct benefit, or at least no substantial harm. Switching from diesel and petrol to CNG in public transport did not affect the speed, the convenience or the long term cost. So the switch was comparitively easy.

I don’t see how exactly the ball is in India’s and China’s court. If anything, the ball is in the West’s court. They have funds for research, they have corporations with deep pockets, and they have rich governments. India and China have a right to and will continue to buy cars and build industries, buying as much of the cost effective and efficient fuel as possible. If that fuel happens to be fossil-fuel, then so be it.

And I don’t think that the argument of the developing nations is an emotional one at all. It is practical and indeed survivalist. If we dont use petrol, we can’t survive. And we do not have the means to build an alternative.

It is the West which should invest in alternatives to which we can switch to without any pains. Not out of any philanthropic or tree-hugging desire, but simply because it makes good business sense. The civilian nuclear deal, though a small step, is the right one in that direction.

Oh, and for the record, I am not sold on global warming. That is not the same as saying I support pollution.

Nice piece. I am sold on Global Warming too, though like BP I am not a tree-hugging liberal. I recognise that some envorionmental degradation is inevitable, but it cannot be indiscriminate.

What India and China should do is a trick question. But, if they remember that ultimately, US ended up paying a much larger cost for cleaning up-it might help. I am not even sure that envoironment is bad economics. Whats wrong with sustainable sources of energy, to give an example.

You guys might want to read ”Ntural Capitalism”, a book by Paul Hawken. Hawken argues that when we extract oil from the Earth, what we are paying for is just the extraction price and not the cost of the good itself. It is simply not sustainable just like it wont make sense if we just paid for what it costs to transport a consumer good and not what it costs to make it.

Makes sense to me.

Nice post – although I can see that your “I am sold on global warming” early statement will raise quite a few heckles ;-) ! It is very difficult to talk sensibly about this topic and unfortunately most people seem to have extreme viewpoints. I am especially suprised by the anti-global warming brigade. Their arguements are always based on ‘the data is inconclusive’, ‘the scientists cannot seem to agree on the causes of warming’ etc and therefore lets forget global warming and consume and pollute at will ! With this approach , we should also forget about evolution and start giving equal time to creationism !

Now, I for one am not sold on global warming and neither am I a tree-hugging liberal – BUT I do agree that our consumption of fossil fuel and the rate at which we are polluting the planet are not sustainable. It just makes a duh!-type common sense – you don’t need a scientist telling you something bad will happen. In the long run, it also makes an economic sense to recycle and have more fuel efficient machinery. I am also confident that invesment in the R&D of technologies like increased fuel efficiency will also have important side benefits. So even if global warming is not a man-made phenomenon – why not err on the safe side – the cost will not be that high.

As I mentioned in a comment to another post, China and India seems to labor under a belief that it is their right to pollute with impunity just because the developed Western world did it before them. However, these countries can easily take advantages of the technological short-cuts and the lessons learnt to make sure that the planet actually exists for their future ‘developed’ generations to enjoy.

Cheers,
BP.