1 Tackling systemic questions BELS, London Simon Roberts Associate Director, Foresight Group

2 can quickly could our carbon- based economy become a low- then zero-carbon economy?

3

4 how does our economy need to adjust to persistently high oil prices?

5 if we reduce demand for carbon-intensive goods, can we still have a healthy growing economy?

6 can we afford to radically scale up renewable energy?

7 desirable objectives are low carbon emissions, energy security, economic growth and low unemployment; can they all be achieved together?

8 smooth transition

9 beehive financial account income current account transfers financial account reproduction (queen) fertilization (drones) cleaning the hive feeding the larvae receiving nectar and pollen guarding the hive foraging

10 which bee owns which cell?

11 flow of stuff /y services £/y concepts energy PJ/y stocks of stuff trade in goods trade in fuel financial account income current account transfers trade in services working population capita financial account transport km/y

12 all physical assets Agriculture Basic metals Chemicals, chemical products & man-made fibres Coke, petroleum products & nuclear fuel Construction Conventional power plants Education Electrical & optical equipment Electricity distribution Fabricated metal products Financial intermediation Food, beverages & tobacco Health & social work Hotels & restaurants Housing Leather & leather products Mineral products Mining Nuclear power plants Public admin. & defence Publishing & printing Pulp, paper & paper products Real estate Renewable power plants Rubber & plastic products Social & personal services Textile & textile products Transport equipment Transport, storage and communication Water Wholesale & retail trade Wood & wood products

13 INDUSTRY Transport equipment Electrical & optical equipment Chemicals, chemical products & man-made fibres Rubber & plastic products Wood & wood products Food, beverages & tobacco Construction Pulp, paper & paper products Publishing & printing Basic metals Fabricated metal products Mineral products Coke, petroleum products & nuclear fuel Leather & leather products Textile & textile products SERVICES Real estate Health & social work Transport, storage and communication Education Public admin. & defence Financial intermediation Social & personal services Wholesale & retail trade Hotels & restaurants DWELLINGS OTHER SECTORS Agriculture Mining Conventional power plants Renewable power plants Nuclear Electricity distribution Water sectors dwellings services industry nucl. RE, etc 2009

14 £ or $? quantifying stuff: satellite view

15 numbers of houses? £ or $? quantifying stuff: satellite view

16 £ or $? numbers of houses? m²?m²? quantifying stuff: satellite view

17 embodied energy? £ or $? numbers of houses? m²?m²? quantifying stuff: satellite view

18 flow of stuff VPJ/y services £/y embodied energy energy PJ/y stocks of stuff VPJ trade in goods financial account working population capita transport km/y

19 data sources Blue Book (Office of National Statistics) Pink Book (Office of National Statistics) DUKES (BERR)

20

21 employment

22 sector sizes

23 jobs ÷ sector size = employability

24 direct energy use

25 energy efficiency

26 direct energy use

27 output of goods

28 sector investment

29 service demand

30 service demand indices

31 transport

32 primary fuel

33 household consumption

34 GDP

35 CO2

36 balance of payments

37 win-win on the BoP!

38 International Investment Position

39 city trader: fixed interest dealing “They’re mad!”

40 flow of stuff VPJ/y services £/y add trade etc. energy PJ/y stocks of stuff VPJ trade in goods trade in fuel financial account income BoP £/y current account transfers trade in services working population capita domestic liabilities £ foreign assets £ financial account transport km/y income

41 news items Royal Mail dispute Jinjao: CO2 intensity of energy OFGEM consumer bills UK & USA protect bankers’ bonus Jinjao: energy intensity of industry OFGEM rising gas imports

42 scenarios: hierarchy of drivers 1.employment 2.service provision responds to demand 3.industry investment 4.house building 5.North Sea production

43 scenarios: indices jobs energy service demand ÷

44 services indices

45 reactive: sector investments

46 employability

47 unemployment

48 reactive: GDP

49 reactive: energy efficiency

50 reactive: transport volume

51 reactive: primary fuel

52 fuel prices

53 reactive: balance of payments

54 proactive scenario! Energy efficiency: more investment Renewables: more investment Transport: aggressive volume reduction

55 proactive: sector investments

56 proactive: energy efficiency

57 proactive: energy types

58 proactive: transport volume

59 proactive: primary fuel

60 proactive: balance of payments

61 scenario observations Reactive: unemployment 4% growth 1%/y sterling 1%/y devaluation CO 2 no change Proactive: unemployment 4% growth 1%/y sterling holds value CO2 40% reduction

62 time to zero-carbon? -40% by 2025 possible tackling systemic questions increasing oil prices? can "afford" but just reduce km! demand reduction with growth? allow services to expand afford more renewables? just reduce consumption a little