[MUSIC] Of course, one argument might be that actually fossil fuels don't all have to stay in the ground. If we applied technology, such as carbon capture and storage at scale, we would be able to bring a lot more, the coal, gas and oil that's currently in the ground, out of the ground. Burn it, use it for our purposes, and just make sure that the CO2 that this process emits do not end up in the atmosphere, but we're actually storing it underground. Is that a potential solution? >> It's certainly a solution that's received a lot of interest over the last 20 years. One of the challenges is the enormously energy intensive nature of a lot of the carbon capture and storage technologies. What you're often seeing is it takes as much as twice as much energy. Sorry, twice as much fuel to create the same unit of energy in a power station with CCS attached. Now there are different technologies, and there is investment in different areas. The challenge you have with CCS is that those backers of that technology, for example, the US did a big push on CCS, but then, actually, withdrew the funding. The European Commission had a great interest in CCS, the UK government has a great interest in CCS. What we’re not really seeing is an effective translation of investment in those areas to technology being deployed at scale. Now, I’m not saying it’s not possible, but I think we can see that the approach that's been taken at the moment isn't really translating into a scalable commercial technology. >> It's much easier to look at the opportunity to manage the agricultural sector and soil absorption rates than it is for me to suggest that people aren't going to drive cars anymore. >> Is there any credence to the argument that much of the fossil fuels or most of the fossil fuels that are currently in the ground, the oil, the gas, and the coal, would have to remain there if climate change is to be addressed? The unburnable carbon issue? >> No, I know that it's been espoused by many. I would suggest that although the science of climate change has given us a very firm budget on the basis of their understanding of where we would need to be for a 50/50 chance of 2 degrees. I think that that's quite clearly understood and has been exhausted in short order. Again, the role of sinks looking outside just the sources and where we emit towards where we can absorb and how we might off-set. For me offers a different vocabulary and I think that there's many, many clear flaws in some of the theses which have been built around that budget. The idea of the carbon bubble in company valuations in particular. But I think we need to move the conversation forward. Away from just focusing on the energy industry and just focusing on production of emissions. Towards a more economy-wide life cycle approach and looking at all sectors of the economy and where the clear opportunities for carbon absorption happen to lie. And I'm not talking about geo-engineering or very flights of kind of science fiction fancy. I think that there are some basic ways that we could do things much, much better, that would relieve pressure on that budget in a way which we're just not pursuing those opportunities at this point. >> But surely you're not talking about forests or oceans either. I mean, the oceans are acidifying because they're already acting as a major sink. And forests, well, we're getting rid of forests rather than planting new trees especially in those countries that are, if you will, ground zero, if you want to use that analogy, in that fight against global climate change. Places like Indonesia, for example. We're losing forest rather than gaining more so where are the sinks coming from? >> For the sake of the global agriculture and food industry that requires a certain amount of palm oil to put into a candy bar that costs 50 pence. And I think that if the candy bar costs three quid because actually the emissions intensity of the product is properly taxed. Or indeed the longer term role that a sink like the Indonesian Rainforest, what that could play in the global budget. That's a failure of a business model and a policy failure, clearly. There's nothing more to it than that as far as I'm concerned. It may be Optimistic to presume that such business models can emerge. I think that truly there's a great opportunity for us to do a great deal more, and to intervene in markets in different ways. And we do indeed have the tools to do that. Fiscal policy, certain types of, lets say, removal of subsidies for very emissions-intense practices. Leveling the playing field in a carbon-constrained world would take us a long, long way towards where we need to be. I love a steak as much as the next man, Harold's, you know, but if it costs me 15 quid for a half a kilo of mince or what have you, then I'm not likely to buy it twice a week. I might buy it twice a month. And if you can inflect consumers behavior, then there's very little that you can't do. >> I would put against that no politician would ever support a system in which citizens would get charged 15 pounds or $15 for a small pack of minced meat because they would get into so much trouble. So they wouldn't want to do that, so they'd want to try and exert pressure on those companies. Well the companies wouldn't want to do it either, because they'd want to sell their product. So? >> Well there's, yeah, again there's the momentum of social expectations in practice, which is one of the obstacles that we clearly need to overcome to realize the Paris Agreement. It's not going to be just about Renewable capacity investments, or indeed retirements, because I think that's a clear point. You need to basically clear space for different types of supply to come to market. It is fundamentally about demand. If you look at the longer term transition literature base, such as it is, the need to improve the overall emissions intensity and energy intensity of The global economy is the single most important contributor. It is the biggest wedge. And there are no studies that suggest we need to do anything less than double the rate of final energy intensity over the course of the next 25 years. It absolutely has to happen. So This is the challenge. Having made the pledges at Paris, implementation is going to rely on a type of political commitment and consistency and intervention in markets which we've never seen before. That was one of my opening comments and I think that is fundamentally what's going to drive these prices. Without it, it's impossible. So you speak about changing the conversation and moving it towards a better understanding of sinks rather than on the production side. So what we've discussed just now in terms of where possible sinks are, and there's limits to what we can do. Are you advocating technology solutions creating sinks? i.e. Carbon capture and storage, that is a sink, isn't it? >> Yeah, certainly yeah. >> I mean we would sink it into the ground. What's the role of CCFs? >> Well I would say two things. One, the potential is largely unrealized. It's basically been a conversation about enhanced oil recovery in the United States to this point, and we need to bring the technology out of that discussion, into power and into industry. and there is a contribution for it to make, I think particularly in certain large and medium Asian markets there's great opportunities for CCS, and indeed, carbon capture use and storage, the development of different types of carbon based aggregates and whatnot, fascinating technological developments which would allow us to sequester and utilize CO2 in ways which, you know, a few years ago when you and I were studying, we would have never considered these things possible. But there is some great great business models that are emerging. And I hope will become the focus of more R&D. Ultimately you'd want, as I said, less thermal and fossil fuel, thermal generation in the system. So the call for CCS should be reduced over time. But making all new fossil fuel generation at least CCS ready, as a standpoint, something that the OECD should definitely be taking. I think it's Unmitigated, kind of unfettered missions. Capacity installations must become a thing of the past. But politicians have not necessarily embraced the technology the way that one would hope. The British experience provides great example. Very bullish on the technology. Very strong academic background. Great commercial opportunity. Wonderful resource base. And policy and consistency, which makes investors extremely wary. And I think it'd be a very brave person, indeed, to forecast. The use of the technology in sequestration in the British Isles, as a result of that. But that doesn't mean the technology's off the table. As far as I'm concerned, everything has to be be on the table, for that more holistic response to actually emerge. [MUSIC]
