Fordham university march 1 2012


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Fordham university march 1 2012

  1. 1. Global Thermostat and the Carbon Market Key Note Presentation Graciela Chichilnisky Climate Change Economics & Energy Finance Fordham University New York March 1 2012
  2. 2. Human Dominated WorldHuman Beings are the largest geological force inthe planetWe are changing the planet’s atmosphere, itsbody of waters, and the complex web of speciesthat makes life on earth Climate Change
  3. 3. Global Risks• Climate Change• Biodiversity Extinction• Clean Water scarcity• Life in the Seas going extinct Avoiding Extinction
  4. 4. URGENCY Why are we being called to respond toThe Climate Question
  5. 5. Catastrophic Risks• Global sea level raise threatens the survival of 43 island nations• Polar Caps melt - accelerating warming trend• Record breaking tornadoes, floods, droughts and devastating fires• 30 million climate migration in 2011• National Security at Risk US Pentagon 2009 Oceans - the origin of life – going extinct
  6. 6. Are Humans Next?• Need Action Now• Waited too long• Industrial economies 20% of world population cause most of world’s C02 emissions Energy from fossil fuels is the issue - 45% of global emissions Clean Energy is the Only Solution
  7. 7. Why Economics?• Why Finance?• Why the Carbon Market? We need to change economic values – the Oscar Wilde moment
  8. 8. The AnthropoceneThe change we are producing will be read in rock formationsfor thousands of yearsA new geological era - the ‘Anthropocene’ – follows theHolocene –it started in 1945 The Bretton Woods Institutions after WWII led to Globalization of Resource Intensive Industrialization and Western Economics
  9. 9. Western Market Economics based on – Competitive Markets - individualistic consumers and private goods: no connection between people – Optimal Growth Theory -- exponential growth of population and resource use – a frontier society without limits: no connection between the economy and ecological systems – Cost Benefit Analysis and Financial Models Discount the Future – a short term vision: no connection between the present and the future Dictatorship of the Present
  10. 10. So far Western economics• Lacks connections between people• Lacks connections between economy and environment• Lacks connections across generations Sustainable Development requires building connections WHY?
  11. 11. Because humans dominate the planet• For the first time in recorded history• Following an era of rapid globalization Humans dominate Planet Earth• We are connecting and changing the planet’s atmosphere, its bodies of water, and the complex web of species that makes life on Earth
  12. 12. This means natural resource limits• As we reach natural resource and environmental limits The survival of humankind is at stake• Need connections with the ecology, between people and with the future of our species Can Western Economics adjust? Can Markets become Sustainable?
  13. 13. Sustainable Economics How to do it
  14. 14. Changes Articulated by the United NationsKyoto Protocol
  15. 15. The Missing Signal• If we destroy all trees & make toilet paper our economy improves – why?• Because Toilet Paper has Market Value & Trees do not. We lack Market Prices New Market prices = New Values New costs and New benefits The Carbon Market Provides the Missing Signal• 1996: KP Placed Limits on industrial emissions• 2005: KP Carbon Market International Law
  16. 16. December 2011: Kyoto Protocol extended 3 years in Durban COP 17• Existing KP limits extended to 2015• New limits pledged for 2015
  17. 17. The Carbon Market• What is it?• What it is not
  18. 18. Emission Limits are the basis of Carbon Market How does it Work Carbon Makes Clean Energy CARBON CHANGES THE Dirty pays profitable PRICES ARE $25/TON ENTIREclean – ZERO Dirty Energy THE Missing EMITTED GLOBALoverall costs expensive and Signal ECONOMY Undesirable
  19. 19. The Carbon Market• Trades $200 Bn/year• Reduced 30% EU emissions• CDM transferred $50 Bn clean energy projects in poor nations• EU ETS
  20. 20. Carbon Market Links to Global Economy Everything is made with energy Economic growth = Energy Use Link to EnergyCarbon Market provides Missing Signal New Market Prices = New Values
  21. 21. FOCUS of Carbon Market• Capping Emissions• We can’t get there without emissions reductions Markets for trading a Global Public Good: Using the planet’s Atmosphere Creating Equity and Efficiency
  22. 22. Where are We?What comes Next?
  23. 23. Green Capitalism in the 21st Century • The basis exists: international law and economics • Theoretically and in practice • New markets for the global commons, new growth theory, new cost benefit analysis and new GDP measures, new international law
  24. 24. The Global Commons New Economics From maximizing profits to economic progressthat ensures survival of our species
  25. 25. The Word needs Energy Clean energy for industrial & developing nations How to do it? Technology Urgently Needed• To Reduce Carbon from the Atmosphere• In a Profitable Way
  26. 26. Global Thermostat Pilot Plant, SRI International - Menlo Park California February 2011
  27. 27. Why a Carbon Negative Solution Carbon Neutral is not enough Reducing CO2 Concentrations in • Neutralizing emissions does not prevent the Atmosphere CO2 Parts per Million (PPM) 800 further increases in atmospheric CO2 700 • Even the most aggressive efficiency Business as Usual improvements and renewables adoption 600 are unlikely to keep CO2 concentration at 500 Constant Growth the generally agreed 450ppm to avoid 400 catastrophic climate risk Wedges 300 Approach / Negative Carbon is the solution1 200 Stabilization Global • Air capture enables direct and rapid 100 Thermostat reduction of CO2 concentration 0 Hazardous Level • GT allows for the capture of even more CO2 450 ppm than we are loading into the atmosphere or that the earth’s systems can absorb – Negative Carbon GT’s technology directly reduces1 United Nations Headquarters, New York, November 12, 2009. Presentation by G.Chichilnisky on"The Rising Tide at Copenhagen: carbon concentration in theA Win-Win Solution for Industrialized and Developing Nations" air, making carbon negative possible Global Thermostat Company Confidential Page 27
  28. 28. Closing the Carbon Cycle• GT Technology Captures Carbon from Air• Inexpensive: Uses Low Process Heat• Cogenerates Power Production withCarbon Capture• The More Power is Produced – the More Carbon is reduced• Makes Coal Plants Carbon Negative• Makes Solar Power Plants even more Carbon Negative
  29. 29. GT’s Air Capture TechnologyThree-Step Process Produces Concentrated CO 2 Stream Step 1 Step 2 Step 3 Air Input CO 2 Capture CO 2 Regeneration Key to GT’s technology is cogeneration using Transport and Compression Other low temperature Injection Applications process heat to capture CO 2 Subsequent steps are shared by all CO 2 capture methods though pipelining costs can be reduced by co-locating where CO 2 is stored or used
  30. 30. UP Absorbing CO2Pipes to oil well or algae
  31. 31. DOWN Releasing CO2Pipes to oil well or algae ponds
  32. 32. Applications & Markets for Captured CO2 Storage Enhanced Oil Algae-Based Recovery* Biofuels* *EOR and Algae-based biofuels represent most significant opportunities for commercial applications of CO2 captured using GT’s technology Hydrogen- Products Based Fuels cement, fertilizer, plastic s, greenhousesGlobal Thermostat Company Confidential Page 32
  33. 33. Unique Advantages of GT’s Technology Measurable advantages over other forms of carbon capture Carbon Negative SolutionLow-Cost Provider •An energy or industrial plant can•Powered by low cost & widely capture even more CO2 than isavailable process heat emitted – a carbon negative solution Flexible IntegrationScalable Design • Fossil, renewable, nuclear•Modular design adapts to plants, industrialdifferent sized applications plants, (cement, steel) – anywhere heat is available
  34. 34. GT Pilot Plant at SRI - October 1, 2010Global Thermostat Company Confidential Page 34
  35. 35. Strategic Partners
  36. 36. GT - Small Island States GT developing fully-integrated biorefinery in Hawaii • Produces carbon negative transportation fuels • Treats municipal wastewater and produces drinking water • Generates green electricity and biochar fertilizers CO2 Fuels, Algae Fuel Solar Dewatering Electricity & Production ProductionEnergy Biochar Waste water Treated Drinking Desalination Wastewater Water Provides critical municipal services while producing energy Global Thermostat As Green As It Gets Company Confidential Page 36
  37. 37. Economics & Energy Finance• CDM of KP Carbon Market – now trades $200 Bn/year• Provide funding for a Green Energy Fund investing in private projects that are carbon negative – eg Global Thermostat• Build Carbon Negative Power plants in Developing Nations + small island states• Increase energy where needed + clean the atmosphere
  38. 38. Global Finance + Energy• $200 Bn/year profitable Green Power Fund• Can renovate $55 trillion global power infrastructure in 15-20 years• Build Carbon Negative Power Plants• Resolve Climate Change• Provide energy for industrial & developing nations• Enhance industrial exports & create jobs• Foster a safer climate
  39. 39. Global Thermostat and theCarbon Market