Learning the Stern lesson

When in the latter stages of last year, Sir Nicholas Stern in his review ‘The economics of climate change’ highlighted the impact on the world's GDP of climate change, there was considerable scepticism in some quarters. The spread of his predictions was very wide — ranging from unabated climate change costing the world at least 5% of GDP each year right up to over 20% if more dramatic predictions come to pass. At the very best, he believes that the impact of climate change on GDP can be limited to around 1%. His report was huge, at 700 pages, and even the executive summary is nearly 30 pages long. It is less than a year since the publication of this epic review, but every day there is more and more evidence that the economics of climate change is spawning the business of climate change. One of the first organisations off the blocks was the Chartered Institution of Building Services Engineers with the setting up of its register of low-carbon consultants as a important link in achieving the aspirations of Part L of the Building Regulations. Another example, highlighted elsewhere in this issue is the recently rebranded living environmental systems division of Mitsubishi Electric in the UK, formerly the air-conditioning division. This company has spent the last few months developing its ‘Green gateway initiative’ as the foundation for driving its future business direction on the basis of reducing carbon emissions. The sales force will be rewarded not just on turnover but on how many products they sell from a ‘green list’. It is also extremely noticeable how many companies with product ranges based on the burning of fossil fuels are embracing renewable energy. Is there a company left which specialises in commercial-scale domestic hot water that is not in some way involved with solar thermal. And if you want an example of just how far solar thermal can go in heating water, turn to page 35 and read about an installation with an output of 56 MWh a year! Boilers to burn biomass and biofuel are increasingly available and, indeed, becoming accepted and installed. What is apparent, however, is that the business of climate change depends implicitly on technology. Without the technology to mitigate the effects of climate change, there can be no business opportunities.