Escaping the Hell’s kitchen of climate change

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The fires consuming Australia give a glimpse into the Hell’s kitchen of tomorrow’s climate change. The fires have scorched 24 million acres, an area larger than West Virginia, releasing carbon dioxide equivalent to two-thirds of Australia’s annual emissions, and is growing. Scientists fear that an estimated 1 billion animals have perished, that some may go extinct and that sensitive ecosystems will face long term damage.

This, sadly, is just the beginning.

Last December, the United Nations Climate Change Conference sounded another grave warning. The world is facing a climate crisis and urgent action is imperative. The 2019 Emissions Gap Report finds that global carbon emissions have risen 1.5 percent nearly every year this past decade, driven in large part by the combustion of fossil fuels for energy and industrial activities for G20 countries.

In the years ahead, emissions will likely grow, thereby accelerating the pace of climate change — particularly for more than a billion people in South Asia, the Arabian Peninsula, and the Horn of Africa. Climate stress will also be a massive threat multiplier as the most vulnerable people in fragile states compete for water, power, food, and security.

Undoubtedly, climate change will also have a profound effect on the United States. In fact, President Trump’s own administration argued that communities across the country are already experiencing its effects — from intensified risk of wildfires in California to droughts slowing agricultural production in Iowa and much more.

While there are solutions to keep the rise of global temperatures below the threshold of 2 degrees Celsius from pre-industrial times, the investments required are significant and diffused. Further, citizens, businesses, and investors often feel powerless and unable to affect the consequences of climate change. To help drive solutions, we offer “carbon insets” and “carbon transparency” as two proposals that can reduce emissions today.

A new era of carbon offsets: carbon insets

In an attempt to mitigate climate impact, companies such as Amazon, Shell, Lyft, Etsy, Formula One, UPS and many others are pledging hundreds of millions of dollars for carbon offsets. In fact, the entire aviation industry is expected to invest $3 billion over the next decade. Offsets that support clean cookstoves or tree plantings do help lower emissions. These offsets, however, are typically disconnected from the actual industrial emissions. Instead, companies and individuals could direct their investment in carbon offsets to the sector and source of the pollution — by insetting, not offsetting. 

Here are three opportunities.

First, focus carbon insets on freight transportation. The demand for trucks, ships, planes, and trains is expected to triple in the next three decades, leading to a doubling in carbon emissions. Over 60 percent of global transport emissions come from trucks; the majority from old, polluting equipment primarily running in developing countries. Imagine a kickstarter for dirty trucks — as Suzanne’s recent article in Nature Sustainability showcases — so that entrepreneurs in frontier markets could use inset funds to decommission or retrofit outdated equipment, directly reducing the climate and health impacts of transport today.

Second, decarbonize metals and minerals production. Metals and minerals are key materials required for the renewable energy revolution, as well as for infrastructure within burgeoning cities. To achieve the balancing act of global climate goals, industry must simultaneously decarbonize mineral production while scaling outputs. Insets could electrify mining equipment and energy infrastructure or advance the uptake of lower-carbon steel production.

Third, invest in regenerative agriculture. Agriculture, forestry, and land use changes account for  roughly 20 percent of total global carbon emissions. Consumers can support the growing trend to use sustainable agriculture methods to sequester carbon through farms. Restaurants, consumer packaged goods companies, and others in the food business may look to these insets to advance farming techniques that reduce carbon today — not just in hipster urban centers but also in rural towns across America.

Investors and consumers are starting to demand carbon transparency

Despite the increasing consciousness about climate change, investor and consumer knowledge of corporate and product carbon emissions is woefully lacking — preventing climate-smart decision making in our business practices and daily lives. Yet, a new generation of social impact investors, large financial houses, and environmentally-conscious buyers are mandating that product firms track and disclose carbon emissions along complex global supply chains. As a result, the consumer marketplace will likely transform in the decades ahead as corporate practices for carbon accounting and product labelling become commonplace.

This week offered a compelling example. BlackRock, the world’s largest asset manager, vowed to make climate change central to its investment strategy and is pressuring other companies to reduce their carbon footprints by disclosing its climate risk and emissions. As BlackRock and other high powered finance firms now acknowledge, transparency in corporate carbon emissions is critical to set and track meaningful climate goals. Private capital has the financial muscle to compel their portfolio companies to evolve as potential climate stewards.

Product labeling is widely acceptable today. Thirty years ago, however, this was not the case. President George H.W. Bush responded to a new era of health consciousness when he signed The Nutrition Labeling and Education Act into law to make the lives of Americans better. Today, there is a growing demand for carbon labelling for consumer products. While companies can relatively easily calculate their own emissions, it remains a struggle to find useful data along today’s global supply chains. In fact, there are many significant initiatives that have emerged to help drive transparency forward, but more work needs to be done. Voluntarily asking companies for transparency in product carbon footprints — or advocating for a legislative policy fix — must be the first step to reduce emissions in a consumer-dominated market economy.

The wildfires in Australia — eight times more destructive than the 2018 California fires — is our children’s future, a Hell’s kitchen.

Individuals, communities, and businesses do not need to wait for government action; carbon insets and transparency can start now. Every one of us can adapt to this new 21st century reality and build a collective backdoor out of Hell’s kitchen to mitigate the worst consequences of climate change.

Suzanne Greene manages the Sustainable Supply Chains initiative at the Massachusetts Institute of Technology Center for Transportation & Logistics. She collaborates with industry and stakeholders to develop new methods to calculate, report, and offset carbon emissions, improving our understanding of the climate impact of products we use every day. Follow her research group on Twitter @MITSustainChain.

R. David Harden is managing director of the Georgetown Strategy Group and former assistant administrator at USAID’s Bureau for Democracy, Conflict and Humanitarian Assistance, where he oversaw U.S. assistance to all global crises. Follow him on Twitter at @Dave_Harden.

Tags Carbon accounting Carbon finance carbon insets Carbon offset Climate Change Climate change policy Donald Trump Global warming
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