Mining Tibet

Last weekend I had a conversation with a Chinese friend of mine in which we wondered what long-term impact of the new Tibetan railway (completed in 2006) would have on Tibetan lifestyle and culture. We were both concerned that the closer link between Lhasa (the capital of Tibet) and the central government would lead to increased pressure for Tibet to develop along Western lines, possibly at the expense of their environment and cultural traditions.

An article in yesterday’s Time Magazine suggests that our fears are not unfounded. The article reports on a recent announcement by the Chinese government of the discovery of large mineral deposits, including 1 billion tons of iron ore, 40 million tons of copper, and 40 million tons of lead. The findings represent a doubling of China’s copper, zinc, and lead reserves. Unfortunately, “the potential reserves, with an estimated value of $128 billion, are spread over more than 600 sites on the Tibetan plateau.” The article goes on to say that, without the Tibetan Railway, it would not be affordable to transport the minerals back east.

The Tibetan government-in-exile and environmental groups are opposed to mining, which would be very damaging to the fragile alpine environment. The Tibetan government further fears that the profits from mining would all go east with the minerals, leaving little benefit to the Tibetan people.

It appears that the Chinese government is now facing its first major test of its professed commitment to sustainable development in Tibet. In previous posts I have touched on the increasing friendship and trade between China and Africa, which sometimes comes at the expense of human rights and true development assistance. Let’s see if the Chinese government can do any better within its own country.

Solar Boom?

Did you know that we’re in the middle of a solar economic boom of sorts? Even though this is a story that ought to interest and tickle environmentalists, it seems that the environmental community hasn’t accorded the topic nearly as much attention as the business community has. Indeed, this has been a business story with a heavy financial market angle, but is that all it should be?

So, what’s been happening? In the last two years numerous solar companies have begun to trade publicly on Wall Street, with a burst of solar initial public offerings in the past three months alone. If their growing market presence is notable, though, their market performance is even more so. Many of these solar companies’ stocks have soared. A look at a comparative chart of some of these stocks shows that their value has jumped up anywhere from 20% to 100% in the last three months alone. To get an idea of how impressive that is, compare those percentage gains to the single-digit interest rate that you earn in your savings account and then imagine what would have happened to your money had it been invested in those solar stocks. Furthermore, a look at the three major U.S. market index stocks (the Dow, Nasdaq, and S&P500) shows overall market gains of 2% – 4% over that same three month period, indicating that the solar stocks have truly been on fire.

Of course, this solar story is not without blemishes. There are some companies involved in the solar industry whose stocks have not done that well in the same period. A look at this chart reveals three such examples. Nevertheless, the number of solar stocks surging seems to outnumber the number of sluggish ones thus suggesting that a boom might be more of the rule and the sideways action or decline more of an exception. The other impressive angle to this story is that this recent boom took place when oil prices have been trading at relatively low prices compared to the summer highs near 80$/barrel. My impression has been that market leaders tend to favor alternative energy stocks when the price of oil spikes and brush it aside when the price of oil slides down to more tolerable levels–though that shortsighted trend might be decoupling.

What all this makes me wonder, then, is what should this story mean to the environmental community? To the environmental movement? The environmental community has focused on the dangers of climate change and with regard to energy, the need for governments to pass stronger pollution regulations and do much more to support alternative energy initiatives. The environmental community has, at times, also been willing to give pats on the back to corporations that show some kind of leadership in improving their energy efficiency and in supporting alternative energy. What the environmental community seems to shy away from is blatant attention to and support for the private sector companies that have made it their business to develop and sell the technologies that environmentalists want to see adopted on a larger scale.

It’s tough to pin-point the exact reason why the environmental community keeps its distance from the business sector. There are probably many reasons, some deeply ideological and value-based, others more plain. The thought of environmental non-profits cozying up to for-profit businesses seems like an unnatural fit, and perhaps might even be limited by tax laws(?). The lack of attention to industry trends might also have to do with the fact that environmentalists might feel let down by a corporate-dominated landscape which built a U.S. economy so heavily reliant on fossil fuels and so averse to environmental protection.

Times have changed, though. Green is more chic than it used to be and companies have started to discover that “going green” can pay off. To bring us back full circle, my question, then, is now that the  market seems to be sending us the right signals about solar power, what can we do to make sure that the market won’t let us down again? 

Natural Capitalism, Ch. 5

This chapter is all about green buildings.  Again H&L emphasize a recurring theme in this book – that the whole is different from just the sum of its parts.  A design framework in which each engineer or architect individually optimizes his own component of the building doesn’t necessarily result in the optimum building.  This is one of the greatest challenges of good green design.  If it were merely about putting the right technologies together in the right way, that would be a fairly simple task; the real challenge is to implement a new framework with which to approach building design.  H&L emphasize the need to “have the architects, engineers, landscapers, hydrologists, artists, builders, commissioners (specialists who get the building working properly between construction and occupancy), occupants, maintenance staff, and others who have a stake in a particular building all design the building together.”

H&L emphasize that, in contrast to conventional wisdom, green buildings, if done right, can have lower capital costs than traditional construction – largely by saving on infrastructure and by using passive heating and cooling techniques.  Companies can also get surprisingly large returns from increased worker productivity.  But these savings for green buildings don’t just apply to commercial buildings – green homes can also be much more efficient at no net additional cost.  In their most impressive example, H&L write:

“A Pacific Gas and Electric Company experiment eliminated cooling equipment in two normal-looking tract houses. The first, in Davis, California, where peak temperatures can reach 113°F, was a mid-range ($249,500), 1,656-square-foot speculative home, completed in 1993. During three-day, 104°-plus heat storms, the indoor temperature didn’t top 82°, and the neighbors came into the house with no air conditioner to take refuge from their own inefficient houses, whose big air conditioners couldn’t cope. Yet if routinely built, rather than as a one-off experiment, the Davis house would cost about $1,800 less to build, and $1,600 less to maintain over its life than a comparable but normally inefficient home, because it had no heating or cooling equipment to buy or maintain.” 

In addition to energy savings, natural resource savings can be achieved by retrofitting existing buildings or reusing materials from prior structures.  H&L note that internet markets are appearing for trading construction materials / waste. 

H&L also discuss the need to correct the incentive structure that governs building design.  That is, the contractors and designers can get away with installing cheap and inefficient equipment because they’re not the ones paying the electricity and heating bills.  (Also, at least in some countries, the way the building is initially designed and the way it is finally built are not necessarily the same, as contractors try to cut costs.  A recent report by the Chinese Ministry of Construction found that in 2005, 75% of new buildings in Beijing were designed to follow the energy efficiency code … but only 5% were actually built that way!)  For example, designers and contractors who design a more efficiency building could be allowed to recoup a portion of the yearly savings.  Leases could stipulate a sharing of the energy efficiency savings between landlords and tenants to encourage both to be more efficient, both in purchasing and using the appliances.

H&L conclude the chapter by discussing the larger context – building green buildings in mixed-use, non-sprawling developments.  They note that these “new urbanist” models are often more popular than traditional suburban developments: “the opportunities they create for ‘negacars’ and ‘negatrips’, for convivial communities, and for safer and better places to raise children can be welcome … to developers’ bottom lines.”

President Hu’s African tour

Chinese President Hu Jintao is currently in Sudan, as part of an 8-nation tour of Africa.  Hu’s visit to Africa follows quickly on the heels of November’s China-Africa Summit in Beijing, emphasizing China’s growing role in the region.

China, which purchases 60% of Sudan’s oil exports, has a huge influence in the region and has been widely criticized for blocking the UN Security Council from taking a more active role against the Sudanese government actions in Darfur.  For the last several months, it has been unclear whether Sudan will be willing to allow 20,000 UN peacekeepers into Darfur.  It is too soon to say what will come of Hu’s visit to Sudan this weekend, but some are optimistic that the Chinese will use their influence to promote an end to the violence and closer cooperation with the UN (largely due to increasing international pressure on China).  Hu reportedly urged the Sudanese president to bring more rebels into the peace process (http://www.wilmingtonstar.com/apps/pbcs.dll/article?AID=/20070203/NEWS/702030347/-1/State).  However, Hu made no reference to Darfur in the statement he released after meeting with Sudan’s president.  (http://www.earthtimes.org/articles/show/26864.html)

Before Sudan, President Hu visited Zambia where, according to the Chinese newspaper The People’s Daily, he announced an aid package that includes some debt relief, increasing the number of zero-tariff Zambian exports to China, and money for a stadium, hospital, and two schools (http://english.people.com.cn/200702/04/eng20070204_347422.html).  However, western papers are quick to point out that not all Zambians are appreciative of this aid.  According to the Economist, African governments like China because China’s aid money (which Hu has promised to double over the next 3 years) comes without any “political conditions”, i.e. insistence on reducing corruption or improving human rights improvements.  But the Economist further points out that anti-Chinese sentiment is rising among the general populace:

“In Zambia, where China has big copper-mining interests, a candidate in last year’s presidential election promised, if elected, to chase out Chinese investors after lethal riots at a Chinese-controlled mine. In Nigeria, Chinese oil workers and engineers have joined Western counterparts in being kidnapped and ransomed by insurgents in the country’s Niger Delta region. And there have been protests in South Africa and Zimbabwe against cheap clothing imported from China.” (http://www.economist.com/displaystory.cfm?story_id=8649776)

Indeed, Zambia’s chief opposition party was prevented from attending any events associated with President Hu’s visit; the party has made no secret of its displeasure at increasing Chinese involvement in Zambia (http://somalinet.com/news/world/Africa/7201).