1 Tackling systemic questions BELS, London2009.10.12 Simon Roberts Associate Director, Foresight Group.

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Tackling systemic questionsBELS, London 2009.10.12

Simon Roberts Associate Director, Foresight Group

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

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

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

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can we afford to radically scale up renewable energy?

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

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smooth

transition

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beehive

financial account

income

current account transfers

financial account

reproduction (queen)fertilization (drones)cleaning the hivefeeding the larvaereceiving nectar and pollenguarding the hiveforaging

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which bee owns which cell?

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flow ofstuff

/y

services£/y

concepts

energyPJ/y

stocks ofstuff

trade in goods

trade in fuel

financial account

income

current account transfers

trade in services

workingpopulation

capitafinancial account

transportkm/y

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all physical assets

AgricultureBasic metalsChemicals, chemical products & man-made fibresCoke, petroleum products & nuclear fuelConstructionConventional power plantsEducationElectrical & optical equipmentElectricity distribution

Fabricated metal productsFinancial intermediationFood, beverages & tobaccoHealth & social workHotels & restaurantsHousingLeather & leather productsMineral productsMiningNuclear power plantsPublic admin. & defencePublishing & printing

Pulp, paper & paper productsReal estateRenewable power plantsRubber & plastic productsSocial & personal servicesTextile & textile productsTransport equipmentTransport, storage and communicationWaterWholesale & retail tradeWood & wood products

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INDUSTRYTransport equipmentElectrical & optical equipmentChemicals, chemical products & man-made fibresRubber & plastic productsWood & wood productsFood, beverages & tobaccoConstructionPulp, paper & paper productsPublishing & printingBasic metalsFabricated metal productsMineral productsCoke, petroleum products & nuclear fuelLeather & leather productsTextile & textile products

SERVICESReal estateHealth & social workTransport, storage and communicationEducationPublic admin. & defenceFinancial intermediationSocial & personal servicesWholesale & retail tradeHotels & restaurants

DWELLINGS

OTHER SECTORSAgricultureMiningConventional power plantsRenewable power plantsNuclearElectricity distributionWater

sectorsdwellings

services

industrynucl.

RE, etc

VPJ @ 2009

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£ or $?

quantifying stuff: satellite view

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numbers of houses?

£ or $?

quantifying stuff: satellite view

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£ or $?

numbers of houses?

m²?

quantifying stuff: satellite view

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embodied energy?

£ or $?

numbers of houses?

m²?

quantifying stuff: satellite view

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flow ofstuff

VPJ/y

services£/y

embodied energy

energyPJ/y

stocks ofstuffVPJ

trade in goods

financial account

workingpopulation

capita

transportkm/y

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data sources

• Blue Book (Office of National Statistics)• Pink Book (Office of National Statistics)• DUKES (BERR)

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employment

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sector sizes

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jobs ÷ sector size = employability

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direct energy use

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energy efficiency

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direct energy use

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output of goods

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sector investment

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service demand

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service demand indices

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transport

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primary fuel

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household consumption

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GDP

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CO2

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balance of payments

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win-win on the BoP!

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International Investment Position

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city trader: fixed interest dealing

“They’re mad!”

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flow ofstuff

VPJ/y

services£/y

add trade etc.

energyPJ/y

stocks ofstuffVPJ

trade in goods

trade in fuel

financial account

income

BoP£/y

current account transfers

trade in services

workingpopulation

capita

domesticliabilities

£

foreignassets

£

financial account

transportkm/y

income

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news items

Royal Mail disputeJinjao: CO2

intensity ofenergy

OFGEMconsumer

bills

UK & USAprotect bankers’

bonus

Jinjao: energyintensity of

industry

OFGEMrising gasimports

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scenarios: hierarchy of drivers

1. employment

2. service provision responds to demand

3. industry investment

4. house building

5. North Sea production

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scenarios: indices

jobs

energy

service demand

÷

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services indices

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reactive: sector investments

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employability

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unemployment

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reactive: GDP

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reactive: energy efficiency

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reactive: transport volume

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reactive: primary fuel

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fuel prices

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reactive: balance of payments

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proactive scenario!

• Energy efficiency: more investment• Renewables: more investment• Transport: aggressive volume reduction

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proactive: sector investments

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proactive: energy efficiency

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proactive: energy types

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proactive: transport volume

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proactive: primary fuel

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proactive: balance of payments

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scenario observations

• Reactive:• unemployment 4%• growth 1%/y• sterling 1%/y devaluation• CO2 no change

• Proactive:• unemployment 4%• growth 1%/y• sterling holds value• CO2 40% reduction

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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