Green Business Basics: 24 Lessons for Meeting the Challenges of Global Warming. Nick Dallas. McGraw-Hill, 1st edition (August 6, 2008). 128pp. $12.95. (ISBN-10: 0071603573, ISBN-13: 978-0071603577) It wasn't until ten years ago that most people started to care about the issue of climate change. In the past decade, we have seen the Earth's temperature rise, icebergs melt, and sea level rise. Climate change has also brought a lot of impacts in human lives and ecosystems, such as food shortages, species loss and extinction, reduced availability of fresh water, and etc. Today, we are facing not only the issue of climate change itself, but also the problem of natural resource scarcity which is caused by climate change. This book aims to give the reader a fundamental understanding of the issues and challenges of climate change by 24 short, but insightful, lessons. The reader will have a bigger picture of the whole issue after reading this book, and they can find concepts in this book including climate change, sustainability, alternative energies, green economy, risk management, and investment opportunities.
First of all, the author talks about the two terms, climate change and global warming, that are usually used interchangeably. Global warming is the major factor causing climate change, and climate change is the most important problem as a result of global warming. Therefore, when talking about the issue of climate change, we are also talking about global warming. To illustrate what global warming is, the author briefly introduces the gas composition in the Earth's atmosphere and points out that the so-called greenhouse gases play a critical role in balancing the Earth's temperature. Among the greenhouse gases, carbon dioxide and water vapor are the two most important ones that help keep the Earth warm. However, the atmospheric concentration of water vapor is not changing directly due to human activities. Therefore, scientists have put a lot of efforts focusing on the research of carbon dioxide which results from the burning of fossil fuels and deforestation, both are human activities. According to the study of past climate, it shows that the more the heat-trapping carbon dioxide exists in the atmosphere, the higher the Earth's temperature. In addition, scientists have found that the atmospheric level of carbon dioxide has increased by 30 percent since the Industrial Revolution. The increase of carbon dioxide has been attributed to lots of human-derived activities during the last few hundred years.
"The most worrying thing about climate change is that scientists cannot be sure of the exact response of the world's climate system to global warming." (p. 21) The author points out that the relationship between the atmospheric level of carbon dioxide and the Earth's temperature is still not fully understood. He suggests that with so much uncertainty, the best way for human beings to respond to the issue of climate change is to act as early as possible.
After introducing climate change and global warming, the author brings up three terms that people should know regarding the climate change issue: the Intergovernmental Panel on Climate Change (IPCC), the Kyoto Protocol and the Stern Review. First, the IPCC is an organization established by two United Nations organizations in 1988 to assess the risk of climate change caused by human activities. Second, the Kyoto Protocol is an international agreement that was adopted in 1997. The major feature of the Kyoto Protocol is having the industrialized nations commit to reduce greenhouse gas emissions by 5.2 percent against 1990 levels by 2008-12. One thing worth mentioning is, although 186 countries have signed and ratified the Kyoto Protocol, the United States, as one of the world's largest polluters, has not ratify the Kyoto Protocol. Third, the Stern Review on the Economics of Climate Change was released in 2006 by Sir Nicholas Stern, the Head of the UK Government Economic Service and a former Chief Economist of the World Bank. The main conclusion of the report is that failure to actively make investment in mitigating the damage of climate change could lead to global GDP being 20 percent lower than it might be otherwise. This report demolished the argument that reducing greenhouse gas emissions would impede economic growth. Stern urges that people should act immediately; otherwise the whole human society would have to devote more forces and costs in the future.
"This is the greatest market failure the world has seen¡K.There is still time to avoid the worst impacts of climate change, if we take strong action now." - Sir Nicholas Stern (p. 39)
The author addresses that pollution represents market failure, because people will have to pay more price for unpredictable climate change if we do not restrict carbon dioxide emissions from fossil fuel use. He proposes that one way of restricting carbon dioxide emissions is to use the "cap and trade" system. This system works in the way that the government sets caps on the amount of carbon dioxide emissions. Polluting companies are assigned carbon credits, which are the permitted quantities of carbon dioxide emissions. Since companies' pollution level has been "capped", if they want to expand their productivity, they will have to either make themselves more energy efficient or buy carbon credits from other companies who pollute less. Here carbon credits become tradable at a transparent price. In order to reduce the carbon cost, polluting companies will devote themselves to developing more innovative and energy efficient technologies. In this way, they not only avoid incurring a carbon cost but also make a financial profit by selling their carbon credits in the open market.
In addition, the author mentions that developing countries are more vulnerable to the impacts of climate change because they are already in the place lacking enough resources to respond adequately to climate change. Fortunately, the Kyoto Protocol has assigned respective emission targets to countries depending on each country's degree of industrialization. It gives developing countries more space to hasten their economic development to the extent that they can well respond to climate change and people can afford basic goods and services. In the mean time, developed nations are responsible of assisting those less-developed countries by various ways such as accelerating technology transfer, financing developing projects, and etc.
"If you think mitigated climate change is expensive, try unmitigated climate change." - Dr. Richard Gammon, University of Washington (p. 51)
Although people currently have the consensus that global warming is really happening and it is caused by human activities, no one has the answer about what atmospheric levels of carbon dioxide are acceptable and manageable. However, if we do not act now, we are just exacerbating climate change. The author suggests that big reductions of carbon dioxide emissions are necessary, so we should take immediate action and stop procrastinating. He points out, "solutions to reducing atmospheric greenhouse gas levels fall into six categories: reducing consumption, modifying consumption, improving energy efficiency, optimizing the energy production mix, carbon dioxide removal/storage, and strengthening education." (p. 53)
After talking about the six categories of solutions to carbon reductions, the author discusses some issues regarding a variety of energy sources. First, he brings up the challenges of reducing transport emissions. Take hybrid vehicles for example, although they are much cleaner, not everyone can afford their high costs. As for biofuels, the biggest problem is, when more agricultural land is switched to grow biofuel stocks, it could cause food shortage and higher food prices. Second, the author talks about nuclear energy. Nuclear energy is problematic for three reasons: (1) the public is still worried about its safety issues, (2) it might enhance the development of nuclear weapons, and (3) the way of dealing with the hazardous radioactive wastes is not convincing. Therefore, nuclear energy is definitely not the right solution to climate change. Third, he discusses that coal, as one of the primary energy sources currently, must become cleaner. The idea is "turning coal into gas before using it to generate electricity, and then later on capturing and storing the carbon dioxide emissions. Gasification increases the thermal efficiency of coal, improving its energy conversion." (p. 70) However, it is obvious that storing the carbon dioxide is not the long-term solution. It is just buying us time to switch to other less carbon-emitted energies. Finally, the author mentions that the three renewable energies offering hopes to the challenges of climate change are geothermal, wind, and solar. However, there are still lots of technical problems that need to be solved, such as improving conversion efficiencies and energy storage technologies, reducing costs, and etc.
In the last few sections of this book, the author addresses that climate change in fact brings a lot of investment opportunities. Because people already have a consensus that we need to do something to alleviate climate change, market favorites start going to products and services that have improved efficiency and commit to use renewable and low-carbon energy sources. With this kind of demand, many companies must put their efforts on developing new technologies. In the meantime, the companies affected by climate change would need advices to help them manage costs and develop hedging strategies. Under this circumstance, companies who can see climate change mitigation as opportunities instead of costs will succeed. The opportunities are for those who can act now and move fast to formulate new strategies against climate change impacts. Moreover, the author talks about governments definitely have a leading role to play in dealing with climate change, such as setting up a legal framework for the carbon reduction mechanism, encouraging innovation and investment in alternative energy sources, setting new industry and building standards, and etc. Once governments lead to act and the positive effects become apparent, private funding will follow. In the end of this book, the author once again appeals that we as global citizen must stop procrastinating and act now!
"Every global citizen has a responsibility to sensitize themselves to the challenge, to monitor the debate, to remain informed, to psychologically prepare themselves for changes, and to put pressure on governments to establish a more activist agenda in addressing this planetary emergency." (p. 98)
In conclusion, this book is definitely worth reading for anyone who cares about the Earth and wants to acquire more knowledge about climate change. This is a short primer with 24 lessons that allow the readers to quickly understand the challenges of global warming. The concepts that the author addresses in this book are easy to understand and very insightful. As members of global citizen, it is our responsibility to know what we human have done that causes global warming and how we should do from now on to mitigate the climate change impacts. This book strongly motivates people to act from now! In addition, by reading this book, it is also a great chance for manufacturers, industrialists, and businesspeople to better understand how they should react to the trends of green business, what investment opportunities will be brought into their field.
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