Cheers!

A short piece I wrote for Work Style Magazine‘s Jan 2012 issue.

Nearly two decades of UN talk about climate change have not produced much in the way of concrete results. For businesses, the status quo of endless conventions presents a real problem. Many companies with significant carbon emissions are increasingly desperate for clear guidance on coherent, transnational climate policy, whether it comes through the United Nations or not. The EU’s carbon market is a case in point. While it has been in place since 2005, price volatility and outright low prices for carbon have not made investment decisions any easier.

2011 has been a record-breaking year in terms of losses, providing a sense of how chaotic climate change itself may unfold. Many companies are exposed to environmental risks especially via their global supply chains. Unfortunately, public resistance in the United States is a major problem for moving forward, even with the extreme drought in Texas and the steady march of convincing science. Businesses are in a position to take a much stronger leadership role, but they must think broadly about what they should advocate for.

Business needs clear climate policy because in a competitive system no one can act first without exposing themselves. Consulting, finance and insurance industries have all made significant strides in creating the right knowledge infrastructure for assessing regulatory and environmental risk. Institutional investors like mutual fund managers increasingly demand emissions data from the companies they invest in, but there is little comparable for smaller firms in spite of the potential cost savings.

Of course, the dirtiest industries, especially fossil energy extraction firms, are more than willing to forestall climate policy while still ramping up new investment in discovery, infrastructure and technology. Carbon Tracker estimates that a serious global climate policy will require 80% of proven fossil fuel reserves to remain locked underground. Risk for non-fossil energy commerce is amplified without a clear exit from the carbon trap.

Climate change means we must unwind from this dangerous situation. Everyone around the world can look toward a future of diminished expectations. People who are already economically and politically marginalized have little choice but to face increasingly restricted options. For Americans, addressing climate change represents a loss of important and pleasurable cultural symbols. Dirty industries must also recognize the diminished futures they can expect. We need an open acknowledgement of change, acceptance of diminished futures and a process of public mourning.

The IEA estimates climate investment postponed beyond 2020 will cost 4.3 times investment now, while the fossil fuel industry received six times more subsidies than renewables in 2010. In this context, stiff national carbon taxes look increasingly attractive for providing market and climate stability.

There is no reason businesses can’t advocate for strong climate commitments with governments and even the public. Leadership on climate requires a much more subtle, committed relationship with governments, the countries they operate in, and the people they depend on and serve. Companies like Nike or Alcoa are already very clear that climate is an important issue for them. To take one  example, how might Americans step to the challenge if high profile companies were publicly to champion clear, durable and robust climate rules?

It is a hallmark of the Clean Development Mechanism that it is still happy producing HFC offsets even though no one wants to buy them.

In the meantime, CDM Watch has pushed its decisive activist methodology into new dimensions. Most notably, they have spearheaded the campaign to eliminate financing for coal infrastructure in the Clean Development Mechanism.

Bloomberg recently caught up with Anja Kollmuss, formerly of the Stockholm Environment Institute, who spends her time detailing the numbers games that have made the CDM into a rotten institution.

Writes Catherine Airlie (subscription only): “Loopholes in current policies to tackle climate change may add as much as 27 billion metric tons of carbon dioxide by 2020, according to a report from CDM Watch, a Brussels-based environmental group.”

“Countries may get away with ruses and ploys in the world of politics,” Anja Kollmuss, a policy analyst at CDM Watch, said in an e-mailed statement. “But nature does not go for accounting tricks.”

The EU ETS has systematically failed to induce investment in low-carbon technologies. This is true in both phases, and it has been true both during and before the euro crisis.

The EU ETS has been repeatedly subject to fraudulent practices, not simply by fringe or criminal elements but also by financial actors at the center of carbon trading. The European Commission recently accepted there would be inevitably some stolen allowances circulating in the markets, and made provisions to legally protect traders. The EC and national law enforcement have been unable to recover the vast majority of stolen credits or lost tax revenue.

Before the euro crisis, the glut of allowances in the ETS was projected to be over 1.1 billion tons of emissions at the beginning of phase 3 in 2013. The price of carbon is far below the cost of implementing new technologies for reduction. Financial actors are quickly abandoning carbon markets due to their dysfunction.

The ETS is highly susceptible to widespread lobbying, with the effect of completely unrealistic market pricing, windfall profits for industrials, political imbalances in who receives free allowances, and inability to include new sectors, such as airlines, into the market.

Carbon markets have especially failed to reduce CO₂. Markets treat all GHGs as equivalent even when they are not, and subsequently avoid the real problem of reducing reliance on fossil energy. The ETS is simply an industrial subsidy for polluters, a fact which helps explain why the economic recovery has increased CO₂ emissions to record levels.

Among other perverse incentives, the ETS has provided a major incentive distortion in favor of new dirty power plants, while the CDM has provided a major incentive to generate HFCs.

Environmental integrity is systematically undermined in the rule making surrounding carbon markets. The only partial exception is when NGO actors, using their own funds, research and initiative, are able to forcefully criticize specific market failings. There is no internal process to maintain or even verify the environmental integrity of carbon markets.

Carbon offsets are rights to pollute. The CDM is a market formally organized to transfer a new ‘natural’ resource asset from the developing world to Europe.

Carbon offsets create more problems for poor people, and make marginalized groups and developing countries bear the climate burden.

The CDM does not reduce emissions and is not designed to reduce emissions. At best, it produces a net zero balance of emissions, but with any error it actually increases emissions.

Widespread error in additionality requirements virtually guarantees that a very high proportion of CDM projects actually increase emissions, while concentrating wealth among a financial elite.

CDM investment is not ‘development,’ but cash payments to existing elite. Its idea of development is highly reductive, focused only on indices of FDI and GDP, with little awareness of the factors that encourage broad social development on an equitable basis. In some cases, CDM projects actively harm the lives of already marginalized groups.

Renewable energy standards have been far more important than carbon markets for investment in China and in Europe.

Forestry offsets are essentially law enforcement programs designed to kick marginalized groups and indigenous people off their land, often by enriching some local elite, promoting plantations and consolidating land grabs. They are incapable of curtailing commercial logging.

Private sector investment in ‘low-hanging fruit’ uses up the most valuable opportunities for developing countries to participate in carbon reduction activities. If and when developing countries have reduction commitments, they will be obligated to pay for far more expensive reductions.

The CDM Executive Board is unable to make necessary changes when environmental integrity of carbon offsets is against the interests of individual member states. Its inability to curtail HFC-based offsets is an excellent example.

The political organization of the CDM perpetuates the marginalization of smaller developing countries.

Instead of acknowledging the problems with carbon markets, the World Bank and related financial bodies have worked to create more carbon markets with lower standards and less transparency. The use of tools like Programme of Activities (PoA) and creditable NAMAs, and the proliferation of Pacific Rim domestic markets stand to make markets ungovernable.

Land use and forestry credits are systemically faulty and highly dangerous. Biospheric carbon cycles are not equivalent to geological carbon cycles, and the substitution of agricultural and forestry projects for fossil fuel extraction is a failure to confront the climate problem.

A global volume cap on fossil energy extraction will give a clear price signal to the market, without any need to commodify emissions. A cap on fossil energy extraction will efficiently distribute costs between fossil energy producers, distributors and end-users, all of whom benefit from cheap, dirty fuels. A volume cap on extraction will allow for a planned phase out of fossil fuels by providing a clear signal about available reserves and their value.

By correctly aligning the expected harm caused with the volume of supply, the price of fossil fuels at market should correctly reflect their danger to human lives and to the planet. A volume cap on extraction attaches the value of CO₂ emissions directly to the price of energy by making fossil fuel energy sources artificially scarce, without a separate emissions-based mechanism.

In contrast, carbon markets and clean energy subsidies risk lowering demand for fossil fuels, paradoxically making them cheaper and weakening the effect of a carbon price, because they place the whole burden on energy consumers without decommissioning fossil energy assets. Carbon markets trust that competition will drive reductions in fossil fuel use, but they fail to recognize that fossil fuel producers are political actors.

Fossil fuel producers do not have the right to continue extraction unabated. There is no right to property that supersedes the right to climate security. Fossil fuels are only safe when they remain unmined in their natural state.

Fossil energy companies are unresponsive to any current regulatory signals. They do not believe that any existing policy proposals will reduce the use of fossil fuels in the foreseeable future.

Development of non-fossil energy solutions may simply increase energy use without curtailing fossil energy extraction.  In addition to giving incentives for development of renewable energy, explicit decisions must be made about how much and which reserves will be left untapped.

Atmospheric carbon dioxide from fossil fuels is not equivalent to carbon already in the biosphere, or other GHGs. Carbon markets enable continued mining of dirty fuels on the false assumption that biotic carbon is equally safe as unmined fossil carbon. It is not possible to adequately substitute protection of forests for continued fossil fuel extraction. Likewise, carbon capture and storage represents a highly risky and temporary solution that can only ever counter a small portion of fossil carbon emissions. These false solutions fail to answer questions of scale and risk.

A planned phase out of fossil fuels eliminates the role of the financial services industry as a de facto regulator of climate policy and the carbon price. In the United States, even while major NGOs and finance corporations eagerly lobbied for a cap-and-trade system, there has been significant apprehension about handing a $2 trillion market to an industry which traffics in other people’s risk. There are very serious political implications to anointing this class of people to be the arbiters of an economic transformation.

The proposal will allow for wise choices to be made about which reserves will be exploited. Dangerous extraction techniques such as mountaintop removal coal mining, hydro fracking for natural gas, tar sands and deepwater oil drilling will be irrelevant with a volume cap. By putting a cap on fossil extraction, energy companies could put their R&D dollars into non-fossil energy technology.

Since taxes and markets are meant to generate revenues for public investment in climate mitigation and adaptation, the proposal raises a significant hurdle. The best approach might be a windfall tax for fossil fuel producers, levied internationally and used to support calls for climate debt as an alternative financing mechanism. The fund could also be used to support energy costs for economically marginalized consumers. Regardless, this is an important issue to be studied.

We cannot avoid the political implications of climate change by fudging the numbers or assuming that an abstract carbon market will confuse the real cost of dealing with climate change for rich-world consumers. The developing world and millions living in environmentally distressed areas are inevitably facing a future of constrained options and diminished hopes. There is no reason the fossil fuel industry should be exempt from this constrained future at their expense.

It was already on the table last December, but this swift death to Kyoto, which contains the only currently operational principle of historical responsibility, is quickly being realized.

On the other hand, for climate justice activists the miserable condition of the UN negotiations can lead for a much stronger statement of the necessity of directly confronting the causes of climate change.

Working with the Climate Justice Research project, I have created a proposal  to directly cap fossil fuel extraction. ‘Keeping the coal in hole’ is a long-standing demand of climate activists. This proposal suggests we can use a ban on fossil energy extraction as a price driver with a direct effect on the climate and on the economy.

Climate Justice Policy Brief – Fossil Fuel Phase Out

We know that climate policy will be effective only if the vast majority of fossil fuels stay untouched, safely and geologically intact. The science is very clear. Here is a proposal to make it happen.

Of course the carbon market investors have been upset to see them go. Here’s what Bloomberg had to say about it, including a comment from me:

CO2 Investors say Ban on Certain Offsets Raises Risk
2011-01-24 16:18:12.475 GMT

By Catherine Airlie
Jan. 24 (Bloomberg) — The European Union’s vote to ban
certain types of United Nations offsets raises investment risks
and the cost of borrowing money, the Carbon Markets and
Investors Association said.
“It cannot be emphasized enough that stable regulation is
central to the ability to raise money for the fight against
climate change,” CMIA said in an e-mailed statement today. The
EU’s ban on some offsets goes against that, they said. “Doing
otherwise will reduce the pool of capital that is available, by
increasing the risk, and also the cost of capital.”
The EU’s 27 national governments agreed to ban as of May
2013 the use of UN-sponsored offsets linked to
hydrofluorocarbon-23 and some nitrous oxide credits. EU Climate
Commissioner Connie Hedegaard welcomed the member states’
decision on industrial gas offsets, saying the credits that are
to be banned created a perverse incentive for investors.
Environmental groups including CDM Watch support the
restrictions. Investors in HFC-23 projects, including Italy’s
Enel SpA, had called on the commission and member states to
limit the scope of the ban and delay its entry into force.
“If investors want a durable, long-term, stable carbon
market they need to champion the regulations that will best
address climate change,” Jerome Whitington, a climate
specialist at Dartmouth College in Hanover, New Hampshire, said
by e-mail. “Their protest over the change in rules now seems
disingenuous at best, and the short-term interests of investors
should remain low priority for policy makers.”

Incidentally, some anthropologists have argued for a similar dynamic regarding social conservatism and transgression, in which transgression is analogous to the dire warnings some climate communicators have used. Transgression functions as a liminal practice which ruptures established social order only to re-affirm that social order as a consolidated formation. I don’t think any of that is particularly surprising from an anthropological perspective, but it does imply – if I’m right that different modes of futurity are in circulation – that the target for research should be climate change practices which do not hinge on belief per se.

I have an article submitted to American Anthropologist which argues that uncertainty is a perspective. Uncertainty is not the absence of certainty as a problem of philosophical foundations or adequate scientific knowledge, but rather a normative claim or orientation toward action. In this sense its primary mode is evaluative (I draw on Canguilhem to make this claim) and it posits a politics in terms of a normative determination of the future. I look toward environmental entrepreneurialism in Lao hydropower management to make the argument that uncertainty becomes a relevant term for practice because there has emerged an ethos that is much more comfortable working with uncertainty rather than fighting it all the time. One sees this transformation in certain practices of expertise, for instance, which take a certain pleasure in getting into the weeds. Their’s is more exuberance than jouissance.

I also get into why I think Michel Callon et al miss the mark in their recent book Acting in an Uncertain World. They pose uncertainty as a problem of action but they do not recognize how actors deliberately create uncertainty, how uncertainty becomes a potential for play or dynamism or how in some cases it is to be minimized whereas in other cases it is to be elaborated. For instance they rail against vested interests who present manipulated scientific results, who use the veil of science to confuse honest public debate about science. And they hold up sincerity of public debate as the hallmark of a reasoned participatory technical democracy. But like Latour’s Dingpolitik, what they present attempts to guarantee neutrality for a ‘flat’ ecology of practices. And to do so they think they can reliably exclude manipulated science from real science, insincerity from sincere engagement. Isn’t that simply to re-inscribe the problem of belief?

Determining the repercussions of the changing climate is a field of great unknowns.

But what I really like is that she doesn’t assume the only objective is to get rid of uncertainty. She asks, “should the quest for ‘certainty’ be the focus of our attention?” Truth be told, as a problem for management climate change and climate adaptation must necessarily involve finding ways to grapple productively with uncertainty rather than attempting overarching control. People who work with nature understand this, and climate adaptation is precisely this.

I love it that she positions this as a problem of information technology. I would like to put up what Lev Manovich calls remediation as a concept to think through. Remediation involves translating a relation into different media in order that it may be manipulated in different ways. New media technologies are paramount for this, and as I’ve been arguing carbon markets are meant to remediate human intervention in the carbon cycle. Markets as information strategies must be understood as integrated in the geological carbon cycle (to the extent that they work!). Rabinow points out that remediation involves subjecting an existing relationship to a new form of mediation, but that it is a matter also of improvement or positing a remedy as a practical matter. For Thacker, remediation inevitably involves creative manipulation. Hence Ospina concludes:

The need to reduce uncertainty should not substitute efforts to foster creativity and flexibility, which lie at the core of resilient responses to the ongoing challenges posed by climate change.

That implies a different relationship to nature.

Bryant writes:

Whitington’s remark is too brief to be sure, but he seems to be suggesting that worries about climate change are yet another variation of apocalyptic fantasies. This would be a way of reducing climate change to a phantasmatic entity.

In fact I was trying to give due analytical space for apocalyptic fears within a materialist-mathematical-technological assemblage that is essentially different. I think this confusion also drove Tim Morton‘s comments. My research is about accountants and carbon market makers. They don’t have apocalyptic fears, but they also don’t necessarily understand climate science. Not believing is not the same as not knowing all the science. Still, belief is a social fact. Especially in the United States, but also in other Anglophone countries, one must contend with beliefs about climate change that are beliefs per se. (One DC energy broker told me – I never talk about climate change. It doesn’t matter who I’m talking to, I only ever refer to emissions reductions or greenhouse gas management. I’m not going to make any comments about the legitimacy of the science or whether climate change is real.)

One matter I’ve been exploring extensively is the future temporality of climate policy instruments, including the corporate anticipation of policy instruments (i.e. how climate policy will make or cost them money). The market types – in business or neoliberal policy makers – reject the closure of an apocalyptic futurity and, in many cases, openly anticipate a future that is uncertain precisely because it is subordinated to material technologies. They constantly index that no one knows what is going to happen.

Bryant pursues an analysis of apocalyptic closure through Freud’s work on repression, offering the implication that real fears are displaced onto and hence, by-and-by, also expressed through the apocalyptic. The vision in turn is properly understood as a symptom. Instead I turn to science fiction because many of the carbon market makers and carbon accountants I talk to for my research offer fanciful visions of hypothetical futures in which ‘carbon’ operates as a global currency, carbon markets will function as global information networks capable of regulating the earth’s temperature, etc etc. The point, however, is that these hypothetical futures circulate as dynamic possibilities, which indeed do drive decisions, investments or practices but not as matters of belief. They are speculative in a different way, as matters of logical extrapolation, and especially of the logical extrapolation of material technologies.

For example, during most of 2010, because the climate negotiations faltered in Copenhagen, many market makers were extremely anxious about the lack of a forward curve in the market after 2013. ‘Right now the word is uncertainty,’ the head of environmental markets at one of the world’s largest banks told me. ‘What little forward curve there is after 2012 has no liquidity because of regulatory uncertainty.’ The human subject in this configuration is essentially subordinate to the material calculative technologies of the market.

In November I gave a paper at the US anthropology conference in which I contrasted this materialist ethos with what Frederick Jameson writes about science fiction, namely that for him it involves the narration of allegories about contemporary social fears and desires projected onto imaginary events in the future. For me, for most of the activity involved in climate change & climate policy, this is precisely not the case. Instead one must have a theory of play in which one is willing to try things to see what happens. (I’ve been influenced a lot in this by the work of Philip K Dick, who simply doesn’t fit Jameson’s argument.) Ultimately this is an argument about thinking, specifically about one way in which it is possible to think through material-technological relationships, i.e. what they enable us to think.

Consider this comment by Richard Branson, CEO of Virgin, who fancies himself a leader on climate change:

So we put up a $25m prize to get engineers, technicians, scientists to start thinking, Is there a clever way of extracting carbon out of the earth’s atmosphere? And hopefully someone will win the prize because obviously if somebody wins that prize we could literally in the future regulate the earth’s temperature. You know when the earth’s getting a little too hot we could take some carbon out, and the reverse, so we could actually keep the temperature round about what it is today which is obviously generally acknowledged as a pretty good temperature. (Laughter) Depending on where you live. If you live in Canada you might want to put a bit more carbon… (Comments at World Climate Summit in Cancun, 5 Dec 2010)

The logical possibilities here stem from the manipulation of material possibilities. It is both – What can we get away with? and – What can we make these relationships do?

Speculative uncertainty is integral to that formation. Its functional operation is seduction, and seduction involves a play, a gambit or wager of uncertainty. (Is Branson serious?) What can we get the atmosphere to do? How can we materially manipulate engineers & technicians into playing our game? These are the same question, for Branson. Is it a joke? Can we tell the difference? Climate change is seductive at the level of technological potential. If the technology was developed (there are patents!), would it matter if Branson, the person, was only joking? Wouldn’t someone, somewhere, be itching to use it? Do we really think – after all this – that we’re in control of these things we make?

See my forthcoming paper, The Prey of Uncertainty, in Ephemera.

The point I was trying to make in my blog post, which seems to have been largely lost on all but a couple people, is that the skeptics and the naysayers are doing something basically different that involves quasi-apocalyptic envisioning of dire futures. BUT because climate change involves an inherent aspect of anticipating an uncertain future, these similar but different temporalities get easily caught up in each other. They too are seduced, but they don’t think of themselves as seduced (which is not the same as being duped, ‘believing’ instead of knowing the facts [Branson knows very little about climate change, I'm sure]).

Hence, far from a relativism, I am proposing an inside-view of a commercial, materialist, speculative ethos that apprehends the future as uncertain. The skeptics and the naysayers have a very different relation to technology; they interpret the future as terrifying, dangerous, etc., in a way that essentially marks their powerlessness. If belief then points toward a displacement or a symptom at the core of climate change, it is a symptom of powerlessness.