Green Growth?
2 November 2023
Earlier this month, the Executive Director of the International Energy Agency, Fatih Birol, made a provocative statement to accompany release of the agency’s latest World Energy Outlook, perhaps the most comprehensive analysis of the state of the global energy system and where it is heading. Looking at the data, Dr. Birol concluded that “…the transition to clean energy is happening worldwide and it’s unstoppable. It is not a matter of ‘if’, it’s just a matter of ‘how soon’ – and the sooner the better for all of us.” He goes on to exhort governments, companies and investors to redouble their efforts, citing the great benefits on offer, of which “new industrial opportunities and jobs” are first on his list.
Dr. Birol is among the most preeminent spokespersons for the virtues of green growth, the overwhelmingly dominant paradigm which states that the energy system can be transformed and climate change solved by operating within the existing global economic framework. Economic growth is not threatened by the green energy transition, the paradigm holds, because the clean technologies can be profitably built and operated, assuring investors that there is nothing to fear. Within the green growth paradigm, the bad guys are those seeking to prolong the era of fossil fuel dominance, and the strategy to win them over is to show that even greater profits are available elsewhere. Financial inducements by governments, such as the US Inflation Reduction Act’s generous tax credits, are a key way to accomplish this. The technical expertise of fossil fuel companies is also transferable to greener industries like offshore wind, geothermal power, blue hydrogen manufacture, biofuels and carbon sequestration, offering many options for reimagining business models while maintaining profitability.
The green growth paradigm may dominate thinking about the renewable energy transition, but it is not accepted by everyone. Many people and organizations identify capitalism as the main culprit in creating the climate crisis, and so do not easily accept that it should provide the framework for the solution. There is also little question that the capitalist-friendly policies enacted so far are not enough to prevent warming from exceeding the best-estimate planetary boundary of 2°C. As extreme weather and other impacts continue to offer regular reminders of the emergency bearing down on us, it is not surprising that social movements rejecting green growth have begun to emerge.
On first thought, it might seem that the Green New Deal represents one such movement, especially since it originated as a critique of capitalism. UK economist Ann Pettifor and her colleagues point out that the privatized and largely deregulated global economic system creates financial incentives to accelerate the extraction of all types of natural resources – including fossil fuels. This creates an “all of the above” energy world where movement away from fossil fuels is too slow to avert climate chaos. The Green New Deal’s assignment of capitalism as the cause of the climate crisis implies that a much greater role for the public sector in the energy economy is necessary. And since climate change has caused disproportionate harm to low-income and vulnerable communities with less resiliency, energy policy should also be coupled to creating a socially just, inclusive economy that will help redress these injuries.
Five years after it rose to public prominence in the US, it seems clear that the version of the Green New Deal promoted by New York Representative Alexandria Ocasio-Cortez and her Democratic colleagues has had substantial impact, increasingly imbuing climate and energy policies across the country with principles of social equity. President Biden has embraced these ideals, establishing the Justice40 initiative by executive order in his first week in office. Justice40 directs 40% of the benefits from many federal investments, including clean energy, to flow to disadvantaged communities. The Department of Energy also requires project applicants to describe Community Benefits Plans, including how new energy projects will advance diversity, equity, inclusion and accessibility. It seems plausible that these and other similar programs will help reduce the disparate impacts of climate change. However, they have been enacted as regulations that do not bind future administrations, and certainly don’t fundamentally challenge the green growth paradigm. Democrats who might have favored more transformative laws were forced to accept the Inflation Reduction Act, with its market-friendly emphasis on industry tax breaks, as the best they could do. So while we see some updating of capitalism to incorporate ecological and social equity concerns, there is nothing here to upset the paradigm of economic growth.
One way to look at the dominance of the green growth narrative is through a basic impact analysis, the well-known I=PAT equation. In this analysis, the climate impact (I) of human action depends on multiplying three variables: population (P), affluence (A) and technology (T). For a lack of a better measure, GDP per capita is usually used to measure affluence. So GDP per capita multiplied by population (capita) just gives dollars. The technology term comes in two parts: energy expended per dollar of GDP, and CO2 emissions per unit of energy. Energy per dollar measures how efficiently energy is used, and the last term is an estimate of the carbon intensity of energy. Multiplying all four terms then yields the human impact on climate simply in terms of total carbon emissions, as all the other units cancel out. Committing to the green growth paradigm amounts to betting that clean energy technology will enable the last term to be reduced effectively to zero, including “negative emissions” like capturing and sequestering CO2 from the atmosphere. Although detailed roadmaps for the energy transition suggest that this is achievable with existing technology at reasonable cost, there are many who question whether it will be possible to muster the political will necessary to bring this about.
The I=PAT analysis captures all the possibilities for reducing climate impacts, so if technology doesn’t get us all the way there, perhaps it is possible to work with affluence. This is the basis for the degrowth movement, which rejects the green growth paradigm in favor of a planned approach to lowering GDP. The premise of degrowth is that a sharp reduction of energy and resource use can not only help solve the climate problem but also temper inequality and bring about greater human wellbeing along the way. Unlike the Green New Deal, which focuses on equitable solutions to climate change and does not reject economic growth in that context, the degrowth movement instead emphasizes the need to selectively downscale in areas where consumption does not benefit human wellbeing. In their recent book The Future is Degrowth, Matthias Schmelzer and colleagues summarized some common ideas shared by degrowth’s proponents: that sustained economic growth (whether equitable or not) necessarily involves the continued destruction of Nature, that as a consequence the downscaling of many aspects of production and consumption (concentrated, for reasons of equity, in the global North) is necessary, and that the transformation away from our present exploitative capitalism must be peaceful and come from grass roots elements of society. These ideas are elaborated in a large and growing academic literature on the subject.
Degrowth encompasses both a radical critique of economic growth and a utopian vision of a sustainable and just future society that has abandoned the pursuit of material wealth in favor of more nourishing forms of wellbeing. Degrowth proponents advocate transformational change that includes elements such as democratic ownership of essential common resources (water, electric power), guaranteed access to essential services like education and health care, disincentivizing and eventually eliminating ecologically harmful industries, and a massive transfer of resources from developed nations to the Global South.
The thinking about degrowth is still concentrated largely in academia, and the strategic planning and political mobilization necessary for ultimately achieving its aims is still in its infancy. However, the envisioned grass roots leadership may now be emerging from the Deep Adaptation movement. Deep Adaptation has grown out of the work of academic Jem Bendell, whose 2018 paper on the inevitability of near-term civilizational collapse from climate change has been downloaded over a million times. The dark side of this “doomist” message is clear (Earthward, July 6) – by casting collapse as inevitable, it can easily create a sense of despair and hopelessness that demotivates action for a healthy climate. Moreover, Bendell cherry-picks recent findings from climate science that support his message, which leads him to prognostications about catastrophic methane release and runaway warming that are far out of step with scientific consensus. Notwithstanding, the Deep Adaptation Forum and interactive seminars that are emerging offer, as Bendell states in his paper, useful frameworks for community dialog. The agenda is built around the “four R’s” of resilience, relinquishment, restoration and reconciliation. Taking action to preserve as much as possible and creating a new beginning after the collapse are part of this. The resonance of this agenda with degrowth seems evident.
Part of the strategic agenda for degrowth might include confrontational tactics, such as the protests led by Extinction Rebellion, an activist group with ties to Deep Adaptation. Extinction Rebellion has sponsored climate protests involving the defacing of art works, as well as large marches in major cities that snarl traffic and direct attention to the cause. Probably more effective, though, are policy actions that fall under the heading of “non-reformist reforms,” which do not accept the status quo but rather challenge existing power relations and pave the way for the more ambitious societal transformations. Substituting bicycles for motorized transportation and restricting automobile access in inner cities are oft-cited examples, as they reject the car-centered paradigm and create spaces where a different culture can arise. Degrowth scholar Jason Hickel has also written favorably about a potential transformation in Europe, which he calls the Eurogreen degrowth model. This starts with investments in renewable energy technology that are also compatible with green growth, but then adds other social policies such as job guarantees and wealth taxes. In this way European society might begin to approach degrowth ideals by slow unraveling of the capitalist status quo. Put like this, the degrowth agenda starts to look a lot more feasible.
Green growth and degrowth might seem to exhaust the options for reducing human ecological impact, but there is another term in the I=PAT analysis that we have yet to consider – population. The rate of growth in the human population peaked in the late 1980s and has been decreasing since, with a plateau somewhere in the vicinity of 11 billion humans now forecast to occur as early as the 2060s. Analysis of birth rates shows that three-quarters of the remaining population growth will occur in sub-Saharan Africa, as much of the rest of the world is already approaching or already past zero population growth. This much is well-known, but less appreciated is that demographic analyses show that, once reaching a plateau, the population does not remain there but rather begins to shrink. Demographers have not reached a consensus about how rapidly population will contract, but continued choice to maintain small family size might result in a decline as fast as the 20th century rise. The implications are anybody’s guess at this point, but it seems intuitive that economic growth has been based in large part on population growth, so a sharp population decline clearly implies economic contraction. If this analysis is even close to correct, then degrowth advocates seem very likely to get at least part of their wish. A century from now, the world will look very different. The inflection point is approximately now.
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Ann Pettifor, The Case for the Green New Deal (London: Verso 2019), https://www.versobooks.com/products/2544-the-case-for-the-green-new-deal
Matthias Schmelzer et al., The Future is Degrowth. https://www.versobooks.com/products/2620-the-future-is-degrowth
https://earth.org/the-role-of-degrowth-in-the-low-carbon-energy-transition/
https://www.bloomberg.com/news/articles/2023-09-27/why-the-degrowth-movement-is-on-the-rise
https://monthlyreview.org/2023/07/01/on-technology-and-degrowth/
https://lifeworth.com/deepadaptation.pdf
https://insideclimatenews.org/news/24122021/deep-adaptation-climate-change-jem-bendell/
https://www.gq-magazine.co.uk/article/jem-bendell-deep-adaptation-climate-change-interview-2023
Michael Mann, The New Climate War: The Fight to Take Back Our Planet (Hachette, 2021). https://michaelmann.net/books/climate-war
https://www.nytimes.com/interactive/2023/09/18/opinion/human-population-global-growth.html
First I've heard of the I=PAT formula. It is useful framework for thinking about the various approaches to climate change.