April has been an eventful month with a lot of stories from High Frequency Trading (HFT) to climate change grabbing the headlines. Even though HFT garnered more than its fair share of time in the press and as even the U.S. Supreme Court decision to strike down overall limits on campaign donations garnered a lot of press, but there is this one news that we should all be learning, thinking, talking about but that is the one that seems to get the least coverage. I am talking about the latest climate change report released by Intergovernmental Panel on Climate Change (IPCC). There seems to be general lack of urgency and curiosity about climate change across the globe. But, I have a feeling that is about to change. Just like what Rahm Emanuel likes to say and I quote: “You never let a serious crisis go to waste. And what I mean by that it’s an opportunity to do things you think you could not do before.” Climate change is a crisis that needs the entire world to come together to solve it and there in lies great opportunities for innovation in business. Over the past few weeks I have read quite a few articles on climate change and global warming that I think would be of interest to the readers of my blog. The first one is by Thomas Friedman of the New York Times titled – Parallel Parking in the Arctic Circle. Friedman talks about how if the warming trends continue the Arctic’s ice cap will melt enough for it to become a navigable ocean for commercial shipping year around. Mr. Friedman was in a U.S. Navy submarine under the Arctic ice cap. Justin Gillis of the New York Times has written about the IPCC report in his article – Panel’s Warning on Climate Risk: Worst Is Yet to Come. Justin highlights some alarming things from the IPCC report. He talks about the fact the poorest countries and poorest people will be most to suffer and there is huge threats to the world’s food supply because of the warming. As the organic matter frozen under the Arctic now decays more global warming gases will be released hastening climate change.
Charles Mann has published a very insightful article on the dependency of the world on energy produced from coal and the challenges associated with carbon capture and storage technologies (CCS). Given the amount of energy produced by coal, we will be dependent on it to provide most of the power for another century. So, we better figure how to make it really (truly) clean. I thought CCS was a very mature technology and process. It is not. It is still in its infancy. China is investing a lot to figure out CCS. Currently, to successfully implement CCS, a power plant would need 20%-30% of the power plant’s output. Since a power plant can only convert 50% of energy from coal, we would need to 40% to 60% more coal to implement CCS. The industry calls this parasitic costs. Given how hungry China is for energy to power its growth, it has been investing in everything and anything associated with energy. Simon Hall writes about how China is dabbling in generating energy from the ocean in his article titled “China’s New Wager: Pulling Energy From the Ocean“.
I will write another blog post on climate change in the coming weeks.