The third & final part of the Janco masterclass… (Part I, Part II if you missed them)

Here are the notes from the last lecture, which basically covers the bolded part below:

1. What is energy and why is it so important?
2. What are the main problems we’ll face in the 21st century as a result of our growing energy consumption?
3. How can we resolve these problems?
   1. At a societal level (reducing energy use, decarbonising energy)
   2. At a corporate & personal level

What I particularly loved was the practical nature of looking at an individual’s emissions quota: what would you need to give up to live with the emissions we need to get to, say 3x lower by 2050? The flaw in the estimates that they don’t factor in technology breakthroughs (which is in general something Janco’s course is too light on, it’s my main criticism) but they do provide an idea of the scale of the change needed (whether it comes from de-growth and/or R&D, and of course it will be a mix).

The case studies from 20+ years of consulting at Carbone4, trying to help a water utility, telco, construction co, and bank lower their emissions were also really interesting as they reveal the depth of the problem (and the results are not published, but you get the impression not much changed)

Anyway, this has been a mind-blowing course, and I’ll no doubt be writing more about the subject in the future… thanks for following along!

Externalities

• Remember all natural resources and the Earth is free / not priced in
• Climate change externalities not priced in
• We should:
  • Depreciate all assets which are reliant on fossil fuel reserves to reflect reserves reducing
  • Add provisions for risks for upcoming perturbations due to climate (provision for risks system is already used in accounting eg for upcoming legal risk)

Global Warming Potential

• Global warming potential (GWP) is the heat absorbed by any greenhouse gas in the atmosphere, as a multiple of the heat that would be absorbed by the same mass of carbon dioxide. GWP is 1 for CO₂
• For other gases it depends on the gas and the time frame.

• The Global Temperature change Potential (GTP) is another way to compare gases. While GWP estimates heat absorbed, GTP estimates the resulting rise in average surface temperature of the world, over the next 20, 50 or 100 years, caused by a greenhouse gas, relative to the temperature rise which the same mass of CO₂ would cause. Calculation of GTP requires modeling how the world, especially the oceans, will absorb heat. GTP is published in the same IPCC tables with GWP.
• “with cc fb” = with carbon feedback modelling. If you factor in carbon stocks getting depleted
• The above is critical in any carbon accounting. The time-frame you’re shooting for impacts which gases you’re trying to reduce.
• For example, 100 year timeframe you care less about cattle farming (CH₂) than on a 20 year timeframe

Existing National Inventories

• Required from each country since 1992 UNFCCC (climate convention)
• Includes the 6 main gases CO2, CH4, N2O, HFC, PFC, SF6
• And forestry reserves
• Carbon accounting in private sector takes into account what the company has done, but not everything upstream in the supply chain
  • France is an exception, asked this from its companies. First country to do this.

Materials Emissions

Transports Emissions

• Tout compris = all included
• Amont = upstream emissions, eg to refine the gas
• Fabrication = production
• Have to factor in everything in the car, including the electronics (equivalent of 2 personal computers in car)
• If your gas-based train (old one) is very empty may be worse emissions per passenger km than car. Same with bus often being empty
• Big motorbike (up to 600kg) can actually emit more than small cars
• Emissions per km from car manufacturers are always the super optimised version (empty car, slight downhill etc). Reality is ~2x
• These numbers will depend country per country based on how decarbonised the electricity network is there

Adding in planes & ferries:

• Remember that flights you typically do 100x longer distance than car
  • 75% of aerial traffic is leisure
• Ferries are actually worse, “de nuit” (at night) here assumes there’s other cargo on board (not well named)
• Recent French law proposal to ban flights if there’s a train route with <2.5 more hours
• Also think about whether the train line is already built / amortized

Food

• Shrimp you need a lot of diesel per kg picked because they’re small and there’s a lot of other stuff you pick and have to sort & throw back
• Beef the biggest source for CO2 is fertilisers (CH4 is from enteric fermentation)
  • Eat 1kg of beef, equivalent to eating 1kg of fossil fuels
• Nitrous oxyde. From fertilisers too
• Hard cheese more emissive than soft, because needs more milk. Ouch, I ♥ Comté

Carbon Accounting

These are the key “buckets”:

• Intrants = inputs
• More and more there’s a move to classify your footprint as all the emissions from what you use (and their upstream imapct), rather than what you emit directly

Case Studies

Water Utility (Veolia agency)

• (Says equivalent carbon – older metric than CO2e)
• Biggest sources for them:
• #1 Electricity to pump the water
• #2 Renewing the network, counters, services
• #3 Replacing pipes (having to dig with a gas-powered vehicle) etc. For instance everything was moved from lead pies to PVC
• What would you do to reduce emissions 3x in 20 years?
  • Do we need to replace pipes as often?
  • Can ask pipe makers to make them in least emissive materials possible, eg recycled plastics
  • Can reduce leaks
  • Can group the works together, eg changing pipes + electricity + installing fiber all in same hole

Telephone Operator (Orange)

• #1 Investments in the network, upgrades
• #2 Making phones
• 80% of their network bandwidth is video
• Electricity from the phone is nothing
• What would you do to reduce emissions 3x in 20 years?
  • Propose to your boss not to go to 5G. Less network investment
  • Try to get people to renew phones less frequently. Problem is this is antithesis of your marketing message
  • Making phones reusable / recyclable “right to repair”

Construction Company

• #1 Steel & cement
• #2 Heavy equipment
• #3 Trucks
• What would you do to reduce emissions 3x in 20 years?
  • Make more stuff with wood. But deforestation you hit a limit
  • Less cement per m³. For instance currently same density at ground floor and 4th floor
  • Recycle more steel. Take from past projects.
  • Move business model less from new construction to using/updating existing stuff

Bank

• #1 Heating buildings
• #2 Staff transport
• #3 Services
• #4 Making buildings & IT systems
• What would you do to reduce emissions 3x in 20 years? (excluding activity from your customers)
  • Change the heating source & building isolation
  • More remote working. Smaller office and less travel

Personal Quota

• Different emission buckets for a typical French person
• From left to right: building housing, energy from housing (90% heating), food, other consumption (33% electronics), transport, services

• 3x reduction in our emissions = 20B tons C02-eq emissions per year
• With 9B humans this would mean ~2 tons per person per year
• What does this get you? Given current emissions from what we do, ONE OF:
  • Paris-Chicago return
  • 4000 kWh electricity in Germany (or 20 000 in France)
  • Buying 10-500 kg of manufactured products
  • Building 4-5m² of new housing
  • Burning 7.000 kWh of natural gas (a few months of heating)
  • Doing 6-8k km of driving in an urban area in normal-sized car (2x less in a “heavy” car like a 4×4)

😯

Interesting Tidbits

• 80% of cultivated surface in France is to feed animals not humans!
• In Singapore 60% of the electricity is used for air conditioning
• Buying vegetables in the winter which are made in France but under a heated greenhouse is much worse than buying from Marocco and comes over by truck
• US is 25% of global airplane miles.
• After 9/11 all flights grounded for a few days, we noticed a drop in temperatures of a few degrees globally. This is from the condensation trails of flights. Not factored into Kyoto gases

Government Intervention

• Global total emissions is what matters for the atmosphere.
• Emissions per widget going down, but companies incentivised to make more widgets

• Government intervention
• Precedent: if a company can’t pay its taxes today, they go bankrupt.
• If we give objectives in absolute value (not relative) to companies this will for sure happen to some companies

Summary of Part III

• When you do robust carbon accounting you realise the extent to which emissions are everywhere in the supply chain. Reducing the total emissions is not just a function of efficiency, but also of total production volume
• There is a market failure as these emissions externalities are not priced in currently. It may be in your interest to improve the energy efficiency of your widgets, but not the total number sold
• If we introduced quotas based on total aggregate emissions, many companies would go bankrupt. There is a precedent to this with taxes, where we favour the “greater good” (pensions, healthcare)

Resources

All the below in French:

1. Youtube playlist (20 hours) – audio only
2. Slides
3. Resumé du cours (30 pages, en Francais) <– highly recommended