South Africa on the brink

This blog first appeared on the Mail & Guardian Thought Leader website

Two weeks into the truckers’ strike and South Africa stands on the precipice of serious societal breakdown. The Marikana massacre was undoubtedly a tragic event in its own right, although it may prove to have merely been the spark that lit the fuse.

The powder keg waiting to explode is the imminent shortage in liquid fuel supplies. Unless the country pulls itself back from the brink, we are in for a national state of emergency.

It may play out something like this.

As fuel supply lines further constrict, many motorists will understandably choose to fill up their tanks “just in case”. Filling stations will quickly run dry, supermarkets operating at the end of complex just-in-time supply chains will see their inventories deplete, exacerbated by panic buying brought on by sensationalist media coverage. Within days, severe food shortages will result, and we’ll be running a real-time nationwide experiment to test the veracity of the adage that civilisation is, at any one time, only nine meals away from anarchy.

Factories will close their doors as production lines grind to a halt, with companies unable to procure raw material supplies or shift burgeoning product inventories. More and more banks and ATMs will run out of cash; emergency services will find themselves simultaneously inundated with calls for assistance as violence and desperation spreads, yet unable to respond due to their own fuel shortages; hospitals will cancel all but the most critical operations as remote doctors and nurses struggle to reach their place of work; burials will be postponed and corpses will pile up in morgues. The country will come to a complete standstill and many of the characteristics of modern civilised society that we take for granted – trust, human decency, a lawful majority – will evaporate.

If all this sounds rather fantastical and unlikely, recall that it has already happened.

In the United Kingdom (UK), just 12 years ago last month, a protest by road hauliers against high diesel prices led to blockades of refineries and fuel terminals, and culminated in a week-long social experiment that will be remembered by anyone who experienced it. The world’s fourth largest economy (at that time) unravelled within a matter of days.

The challenge facing South Africa today is not identical, though situational differences should not lead us to a position of complacency. The UK dispute specifically targeted transport fuel supplies at source, whereas the current crisis involves the road haulage sector (which is but a critical component of the supply chain) as a whole.

However, throw in some extremely combustible kindling created by entrenched social inequalities and legitimate labour grievances – which have found their most recent violent expression in the extractives sector disputes – and we have all the conditions necessary for collapse.

The extent of our dependency on liquid transportation fuels – overwhelmingly derived from oil, more often than not from unstable parts of the world – becomes vividly apparent only when they no longer flow freely.

Until this moment, we scarcely give a moment’s thought to how pervasively oil seeps through every aspect of our lives.

Note also that absolute physical shortages are not necessary; with the human tendency to hoard in anticipation of a crisis, all that is required is for the notion to take hold that limited fuel supplies are a distinct possibility.

It becomes a case study in self-fulfilling prophecies.

Of course, none of the above is inevitable in the coming weeks. What is likely, however this plays out, is that we will recover from the crisis and return to some semblance of normality without properly facing up to – much less addressing – this pernicious dependence on liquid fuels.

To the extent that we pretend to deal with it, our “answers” will probably be found in synthetic oil substitutes – coal liquefaction and Karoo shale gas – proffered as a pathway to national energy security that insulate us from undemocratic regimes in faraway desert lands. It’s a shell game – a confidence trick designed to keep our eyes away from the real prize. It’s methadone for our collective heroin addiction.

Priming the Pump at Durban

This blog first appeared on the website of think tank and strategy consultancy SustainAbility

Another year, another COP, another step closer to the brink. It must seem to the casual observer that the UN climate negotiations are an exercise designed explicitly to create gridlock and failure. Judging by many of the blogs, comments and tweets I’ve been reading since bleary-eyed delegates stumbled out of the Durban ICC on Sunday, the most recent episode has provoked some strong but mixed reactions: politicians claiming a triumph of multilateralism, NGOs decrying the lack of progress on issues of substance. Both views hold some merit. As someone who was present in Durban for the regulation fortnight – but missed the 36 hours of injury-time – I’d like to weigh in with my personal reflections.

Before that, a confession: I’ve always had a ‘thing’ for prime numbers. I find their indivisibility immensely satisfying, suggestive of an eternal significance which shows up in unexpected places. For instance, I could never quite put my finger on why the game of rugby is such a dire spectacle, until I realised: there are 15 players on each side! The prime numbered 11-a-side codes of football and cricket are self-evidently superior. In a similar vein, when a football club wins five European Cups (as my Liverpool did in 2005) it gets to keep the trophy in perpetuity and UEFA commissions a new one, to be tossed around cheaply among subsequent winners of the tournament… until that magical prime number is reached once more.

Back to climate change. A brief review of previous UNFCCC COPs reveals a curious pattern in which significant moments of progress are marked by prime numbers. At COP3 in Kyoto, negotiators hammered out the eponymous Protocol, which to date remains the only legally-binding international climate treaty ever brokered (although as I write this, news filters through that Canada has withdrawn due to its failure to meet commitments – a bit like skiving off your final exams the day before because you didn’t show up at any lectures). In Marrakech, COP7 reached an agreement on how to implement the Kyoto Protocol among 193 of the 194 signatories of the UNFCCC, the sole absentee being the nation that is by far the largest historic contributor of GHGs to the atmosphere. Montreal’s climate summit in 2005 was significant for being the first meeting of the Parties to Kyoto, namely COP11/MOP1 – two prime numbers in one conference! Two years later, in another prime double-header, it was at COP13/CMP3 in Bali where the intransigent US was famously shamed by Papua New Guinea’s Kevin Conrad, who issued the challenge to either lead, or “get out of the way”. The US backed down, opening the way for the Bali Roadmap that was intended to deliver a “Kyoto 2” in Copenhagen.

I won’t lay the blame for COP15’s failure to deliver entirely at the door of composite numbering. At least the signature text of the summit went as far as to declare – for the first time at a UNFCCC conference – what was meant by the Convention’s ultimate objective to “avoid dangerous anthropogenic interference with the climate system”. By introducing the 2°C threshold – with deep emissions cuts guided by science and on the basis of equity – the Copenhagen Accord (PDF) was not entirely useless, setting the tone for the Cancun Agreements issued at the low-key COP16. As for the rest of the even-numbered COPs, they were undoubtedly necessary staging posts on the way to the prime events, but honestly, who remembers what happened at COP14 in Poznan? Anyone? How about COP12 in Nairobi? Like the World Cup group stages, there’d be no knock-out phase without them, but barring the occasional seven-goal thriller they’re generally pretty tedious affairs.

So what of COP17? Despite hosts South Africa receiving widespread and deserved praise for saving the talks from total collapse, many have correctly asserted that the Durban Platform contains nothing of substance that helps steer the world from its catastrophic business-as-usual 4°C trajectory. No international legal framework has been agreed (yet), national voluntary pledges made in the wake of Copenhagen have not been tightened, business leaders may still claim paralysis owing to a lack of regulatory certainty. On the flip side, the most complex political negotiations ever attempted remain intact, with all 194 Parties – including the world’s largest absolute emitter, the world’s fastest growing emitter, the world’s largest per capita emitter, and the world’s largest historical emitter – committed to negotiating by 2015 a legally-binding deal to cut emissions that will enter into force by 2020. Perhaps it will take the IPCC’s Fifth Assessment Report (PDF), due towards the end of 2014, to provide the fresh impetus to the negotiations.

Meanwhile, national governments continue to enact domestic laws to penalise GHG emissions, irrespective of the perceived failure of the international negotiations. The UK’s landmark Climate Change Act set the ball rolling in 2008, but now even carbon-intensive emerging economies like South Africa are on the verge of introducing carbon taxes, hot on the heels of Australia’s recent legislation. From a business perspective, surely the drums are now beating loud enough for companies to start planning for success rather than failure in humanity’s collective efforts to address climate change. If we think mitigation for 2°C is expensive and complex, just wait until we start adapting for 4°C. As one observer wrote in the aftermath of Durban, “It’s not a choice between a climate change deal and economic development; it’s really a choice of both or neither.”

Durban may not have been the emphatic breakthrough that most of us wished for, but I’m convinced future historians will judge it to have been an historic COP: the one at which the pump was primed.

Fracking Irresponsible Development

A year ago, I asked a middle manager at a multi-national liquid fuels company why its sustainability report didn’t contain any discussion of peak oil.  He shot back with a withering “I think we’ve got beyond that.”  I believe he was right, though not in the way he intended.  

Amidst all the outcry and outrage provoked by the prospect of fracking natural gas from the Karoo, insufficient thought has been given to how the fossil fuel resource is intended to be used.  What’s the real motivation behind Big Oil’s attempts to get its hands on those methane molecules?

Energy, of course!  You know, the Energy Dilemma?  The world needs more energy with less CO2, so “we are producing more cleaner-burning natural gas and using advanced technologies to develop new resources” – it says it right there in Shell’s 2010 Sustainability Report.

But let’s examine that statement carefully.  There’s nothing factually incorrect in what Shell says.  Natural gas is the cleanest-burning fossil fuel, and Shell (and many of its Big Oil brethren) is producing more of it year after year.  However, there’s something about the choice of language that might be opportunist at best, disingenuous at worst.

First, it’s hard to take at face value the notion that Shell’s steady drift into natural gas is the result of a deliberate strategic decision to turn away from dirtier fossil fuels.  Consider that the company’s relative growth in gas has occurred over the same period of time that it was investing heavily in the Albertan tar sands.  Far easier to swallow is the idea that Shell has simply not been very successful at finding conventional oil resources – recall the reserves scandal of 2004 – so that over time its portfolio has diversified in both directions: simultaneously growing in cleaner-burning natural gas and filthy bituminous hydrocarbon deposits.  The next time you meet a Shell executive, ask the question: when was the last time your company (or any other oil major, for that matter) walked away from economically-recoverable conventional oil resources because of a strategic decision to focus on natural gas?  They would have a job explaining that one to their shareholders who focus on replacement of reserves as a key indicator of company performance.  

Second – here is the crunch – what do Shell (and Sasol) have in mind for all that Karoo shale gas?  The clue lies in Qatar.  It’s based on an elegant piece of chemical process engineering whereby carbon atoms are stitched together to synthesise the longer hydrocarbon chains that comprise petrol and diesel.  The really neat thing is that, technically, you can use anything containing carbon, including cleaner-burning natural gas, filthy dirty lumps of coal, wood chips, my mother’s bathroom curtains, or even the finest Persian carpet.  The choice of feedstock informs the economics of the process – rug-to-liquids being at the high end of the cost spectrum – as well as the energy required in the conversion steps.  So flexible is this technology platform Shell gave it the label XTL, where X = any source of carbon atoms.  When X = natural gas, it’s called GTL.  Which brings us back to the Karoo.

Why does this matter?  Because in the context of our global Energy Dilemma, what’s important is maximising the energy services – heating, cooling, lighting, mobility, communications – delivered to society while minimising the associated CO2 emissions.  This is where the term “cleaner-burning” appears disingenuous.  True enough, GTL diesel fuel burns with lower sulphur dioxide, lower nitrous oxides, and lower particulate matter than conventional oil-based diesel (based on current fuel quality standards).  This is directionally beneficial in terms of improving urban air quality.  However, exactly the same is true of coal-to-liquids diesel, or rug-to-liquids diesel; the “cleaner-burning” character of natural gas has precisely nothing to do with it.

In terms of CO2 – the most important form of pollution wrapped up in this Energy Dilemma – GTL is essentially no better than regular fuel.  Which is to say: it’s considerably worse, because by far the most rational use of natural gas in addressing the more-energy-with-less-CO2 conundrum is using it to displace carbon-intensive coal to generate lower-CO2 electricity.  In parallel, by investing in electromobility, we simultaneously do away with those nasty tailpipe emissions at a stroke.  If instead we allow natural gas molecules to enter the liquid transport fuel supply via GTL plants, we pointlessly fritter away all the carbon advantage inherent in the resource.  From a climate change mitigation perspective any decision to follow the GTL path is nothing less than irresponsible.

Then again, the potential use of natural gas as a lower carbon bridging fuel in the struggle against rising CO2 emissions was never the driving force behind Big Oil’s attempts to open up the Karoo.  They are not in the electricity business, they are in the liquid transport fuels business.  All forms of energy are not the same.  For them, the Energy Dilemma is about securing more hydrocarbon resources and leveraging their enormous chemistry sets to create synthetic petrol and diesel that will be set on fire in desperately inefficient motor vehicles.  I think we’ve got beyond that.