Energy and the UK OBR Fiscal Sustainability Report

The second Fiscal Sustainability Report published by the UK Office of Budget Responsibly appears to make no reference to energy other than to falling North Sea Revenues. Important though this is, it is the statement that productivity will continue to increase at the long run 2%, without justification, that is the critical issue.

Productivity has been, and is, intensely energy dependent and here is significant discussion about the amount of easily won energy moving forward from this point, and the value of the useful net energy it yields; not least within the International Monetary Fund.

Energy use and GDP are historically closely correlated and projections that ignore this are suspect at best and probably meaningless.

This a strategic mistake as it fails to focus the available National creativity on the search for energy and resource intensity reduction in UK economic activity at system level.

At the moment, all efforts are aimed at marginal energy and resource intensity improvements at micro level.

dd

See also Energy, economy and the impending rite of passage

 

Why the military must(n’t) invade our schools

In yesterday’s Telegraph there was an article titled ‘Why the Military must invade our schools’ and whilst this might have a simplistic attraction in the situation we find ourselves in as a society, it fails to address the reality we are now in. Fragmented as society of’ individuals’ in a future where the Common Good must be placed centre stage as the energy and resource intensity of our society, SystemUK, inevitably falls.

Radio and Television programmes abound, Panorama last night for instance, but none recognise this fundamental reality. The Seventies were the beginning of the future we are now in, only with outcomes differed was a result of the exploitation of North Sea Oil. Which we squandered on Business as Usual, creating no reserve for the transition to the future we are in.

As a consequence, neither did we educate for this reality and the common purpose and action this future requires. The ‘Service for the Nation’ required of us all.

We are now in a world of fire-fighting failure demand and looking for End of Pipe solutions to Society’s Failure Demand. Such is the reasoning behind ResPublica’s genuine concern. Failing schools, send in the military to sort out the problems.

But we are all in this together for the Common Good, and whilst it is eminently sensible to encourage military personnel to take up the work mentioned in the article, dealing with the issues in separate boxes does not solve the problems at system level, SystemUK.

We thought resources were plentiful, to squander as we thought fit as individuals, rather than the reality; limited and needing to be marshalled for the Common Good.

In this future we must all be expected to act for the Common Good, bankers included!. This can only be achieved by educating for and implementing, universal and compulsory ‘Service for the Nation’ , not military discipline in a forlorn attempt to contain the Failure Demand created by not doing the right thing right as a Society.

There are difficult times ahead but we must start now if we are to ensure a coherent and competitive society rather than a failing one. There are scenarios out there we do not   need to let happen.

dd

 

Greece and Essential Value, a letter to a friend

To Catarina Tully at From over Here

Hi Cat

Sir David King has just made the following statement: Sir David King lambasts Treasury for preventing green economic recovery http://bit.ly/M1AxgG

How do we get the message across that it is not about ‘resource efficiency’ but about the ‘effective’ use of resources creating ‘essential value’. This is not an easy discussion to have, but if we don’t face up to this as a society we will end up in the situation in the book just released. http://www.guardian.co.uk/business/2012/jun/08/why-uk-no-longer-superpower

If we continue to muddle along on the basis that completely free enterprise can find a way forward when the marginal cost of producing a barrel of oil is over $90 and the useful energy remaining is on a downward trajectory, we are deluded. http://vimeo.com/43261566

We see in Greece the effects of the reducing Energy and Resource Intensity of a Society and Economic Block that does not recognise what is really happening.

Chandran Nair does recognise this and is doing his best to make Asia aware of the situation: as Asia tries to grow using the multi-planet paradigm this contagion can only spread. http://www.youtube.com/watch?v=5_CL2imxmeE

These are Global issues but we must act as SystemUK if we are to be competitive and provide inspiration to others on the art of the possible. Are we the innately ingenious people we think we are, or was our prosperity purely a result of the Energy and Resource Intensity we were able to exploit?

The answer is probably a lot of both and we need to recognise this if we are not to squander this innate creatively and ingenuity as the Energy and Resource Intensity of SystemUK inevitably falls.

Regards

Derek

http://trailblazerbusinessfutures.wordpress.com/governance/seminar-resources/lc/

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My letter in the Professional Engineering Journal 2007

Engineers are supposed to be mathematically literate but a simple understanding of compound interest is all that is needed to see that the current predictions of growth are the pipe dreams of economists.

Take a chess board and put one unit on the first square, 2 on the second and 4 on the third and continue doubling up. The time to each doubling is 70 divided by the rate of growth i.e. 7%/annum is equal to 10 years.

Add the squares together 1+2+4 = 7 i.e. the sum of all previous doublings is less than the value on the next square – 8

Oil was first commercially exploited in 1859 and we are now at around 30 billion barrels/year and on the 32nd square. At the present rate of growth we will need more oil in the next 20+ years than in the previous 150!

Even if this amount of oil exists, finding, extracting and applying unknown technologies to turn the poor quality, heavy, and polluted crude we obtain into useable product is clearly not possible on this time scale.

And that’s without the climate crisis and the fact that we need a fair amount of the remaining oil to create a low carbon future.

Derek

Derek Deighton MIQA AIEMA AMIMechE

Coordinator, Northwest Engineering Institutions, Sustainability Joint Venture

Northwest Energy Forum

Trailblazer Business Futures, Business and Built Environment Systems Integration

Helping create the One Planet World through creative partnerships

 

‘Essential Value’ and Resource Intensity

It is now widely acknowledged that global resources are increasingly constrained, most recently on the 16th March by the US, where the president signed the National Resource Preparedness  Order

As resources become more constrained, we, as societies, organisations and individuals will decide what is the ‘essential value’ that gives us a satisfactory ‘Quality of Life’, within the affordable resources available to us. Spending on ‘non-essential value’ will of necessity fall; although in the real world it will not completely disappear as incomes will always be unequal. (luxury car sales to China for example)

We can see at  http://trailblazerbusinessfutures.wordpress.com/the-one-planet-equation/ that Resource Intensity decides the Consumption (Value) creatable for a given consuming population. Past circumstances that allowed a disproportional level of consumption in the West for given availability of resources no longer apply.

In the limit, most available resources will be used creating ‘essential value’ and we can thus define Resource Intensity as ‘the resource use per person per unit of ‘essential value’ created’.

Although there will always be transient niche markets; in this One Planet World, only organisations that create ‘essential value’ can hope to survive and grow over time.

What we can say is, tomorrow’s successful, sustainable organisations will help maintain the Essential Value Created on Energy Invested by

• Satisfying emotional and spiritual need rather than gratuitous wants – self-actualisation
• Satisfying the essential needs in the lower orders of Maslow’s Pyramid
• Employing people rather than energy
• Creating or using renewable energy and other resources
• Minimising water use or creating the technologies that do
• Creating/deploying climate stabilising and mitigation technologies
• Being increasingly local
• Providing a service rather than a product
• Practising life-cycle stewardship of their resources
• Managing value rather than cost
• Being able to operate at continually reducing resource intensity

Defining the ‘essential value’ you and your organisation add to society is the first step in deciding a viable business strategy and this is best seen as an organisational ‘Quality’ issue http://trailblazerbusinessfutures.wordpress.com/2011/10/26/re-defining-quality/

DD

 

Strategic Thinking in UK Governance

The UK Public Accounts Committee has recently carried out a consultation exercise on ‘Strategic Thinking in Government’. A link to the submission made by me can be found below.

dd

Background to the consultation

Reasons for the inquiry

 In October 2010 PASC published a report, ‘Who does UK National Strategy?’, which concluded: The answer we received to the question, “Who does UK Grand Strategy?” is: no-one … As things stand there is little idea of what the UK’s national interest is, and therefore what our strategic purpose should be.

 Background

 The global system is increasingly multipolar, with power shifting East, potentially diffusing to international institutions and to different non-state actors (like civil society, business, high-net worth individuals, cities and regions, sovereign wealth funds, Diaspora groups, international multi-stakeholder fora).

 The development in social media that harnesses the ‘wisdom of crowds’, cyber-advances, and other technological progress is transforming the context of policy making. This challenges the capacity and nature of government but also provides opportunities for both stronger engagements with the public and clearer national leadership.

 The complex and unpredictable nature of many global issues, which stem from multiple and interrelated problems, require systems-based and evidence-based analyses if emergent strategy is to be effective and efficient. Within this context, many countries (including the UK) face implicit, diffuse and unpredictable risks, rather than explicit and identifiable threats.

 In a previous report, we identified a deficit of strategic capacity across Government. In its initial inquiry, the Committee found “little evidence of sustained strategic thinking or a clear mechanism for analysis and assessment. This leads to a culture of fire-fighting rather than long-term planning”.

 We wish to assess what progress has been made since then.

 Response to the PASC Consultation on Strategic Thinking in Government v2

 

Reducing the ‘Resource Intensity of Society’ ~ the critical driver for HE and FE

“In the #oneplanetworld how do we continually reduce the #resourceintensity of society? Do we rethink everything, or do we let the Earth do it for us?”

Resource Intensity of Society – “the resource used per person per unit of ‘essential goods and services’ created”.

Two things flow from this

1. Non-essential processes add no value to society in a resource constrained world, their RI is effectively infinite
2. The least resource intense process is the one that doesn’t exist.

The Oil Drum 30^th July http://www.theoildrum.com/node/8210

It has been a constant theme in these columns that the global oil supply is under real threat. The facts to confirm this are everywhere if one were interested in pursuing the topic. (Google “Peak Oil” and see what comes up). A clear indication of a shift in supply is that Saudi Arabia, while it increased its output by 700,000 barrels per day, has kept more of its oil at home to benefit its own citizens with air-conditioning and desalinization projects.

So how do we confront a shrinking economy at work and at home? Brutal assessments will be the order of the day. Even though the top 10 percent of the population will manage to keep luxury businesses going for a time, the economy must shift away from businesses that feed the public’s desires to those that address what people need to survive.

Small enterprises will fare better. All businesses should start wondering whether their employees could get to work if they couldn’t afford to fill the gas tank. Is your business near a transit network? These are tough questions”.

“So how do we confront [and avoid] a shrinking economy at work and at home?” We do it by decoupling ‘service availability’ from ‘resource use’ as viewed from a ‘SystemUK’ perspective, by rethinking FE and HE to enable the creative reduction in the processes ’essential ’ to maximising our Quality of Life with the resources competitively available to us. We become continually more ‘effective’ as a society.

We don’t do it by trying to do what we are doing now more ‘efficiently’

Competitively winning constrained resources requires us to evolve and create organisations that can innovate as expressed in the presentation. Enabling the Future v1

Let’s not change a Challenging Adventure into an Impossible Challenge

dd

 

R we 2 remain fixated on cuts, or will we start creatively reducing the #resourceintensity of SystemUK?

Yesterday in the Mail on Saturday Iain Martin contributed an article “Sorry to depress you but there will have to be even harsher spending cuts“. This perpetuates the myth that the world is still a multi-planet one without limits, as economics, as presently constituted assumes.

The reality is, however, that it is a ‘oneplanetworld’ where we are now bumping against resource limits and the balance of economic influence is shifting from the West to the East. ‘Cuts’ are now not the answer to our predicament and our future, not that they ever have been, if had had but the whit to realise.

We have to rethink ourselves as SystemUK against future of a limited and reducing access to energy and other resources, both in an absolute and competitive availability.

Critically we have to rethink how we govern ourselves in a oneplanetworld which is increasingly local and with the resource availability per person per unit of goods and services reducing.

Intelligent and creative Resource Intensity reduction, not knee-jerk ‘Cuts’ is the only way to retain a democratic, coherent and competitive SystemUK in the oneplanetworld.

dd

Iain Martin Mail on Saturday 19 July 2011

…But it’s becoming increasingly clear that the present problems will not be a temporary phenomenon. This week, the newly-created Office of Budget Responsibility released a chilling report on Britain’s longer-term economic prospects. It said that our already high levels of debt will climb to more than 100 per cent of national output shortly after the middle of this century.

The cost of an ageing population — with more and more demands on the NHS — will increase pressure for much deeper spending cuts or big tax rises…..

 Read more: http://www.dailymail.co.uk/debate/article-2015365/IAIN-MARTIN-Sorry-depress-harsher-spending-cuts.html#ixzz1SO6Sxm2Z

 

Thinking Aloud ~ Meeting the exponential demand for creativity, ingenuity and Tacit Skills in the #oneplanetworld

An email to a friend

Hi Andrea

 It good to catch up again last night at the Lancashire Construction Best Practice Club event; This was a really interesting meeting and after  I mentioned Sugata Mitra’s new experiments in self-teaching. Here is the link to the TED Talk he gave last year. http://www.youtube.com/watch?v=dk60sYrU2RU

He has virtually proved that learning is an emergent property when small groups of students have access to information they can share.

I feel we are failing our learners if we do not lever the potential of social media and the internet to liberate the creativity all children possess and largely lose as they grow up with the educational model we have used since the beginning of the Industrial Revolution  . Ken Robinson makes this point in probably the most watched TED Talk at http://www.youtube.com/watch?v=iG9CE55wbtY

Alison’s ideas and work with her Classofyourown Project www.classofyourown.com  is similarly inspirational and a vital tool in engaging children in the STEM subjects.

The problem, of course, as Alison has pointed out, is not with the children, it is with the Teachers and the industry, simply because they were not exposed to this concept of ‘emergent learning’ and the unlimited expectations of their mentors as they grew up.

In reality this educational model never served, but in this time of exponential change, where more children will be passing through education in the next fifty years than have ever done, we cannot create inspirational teachers fast enough to liberate the necessary creativity that will enable us to solve the problems presented in the One Planet World we now inhabit.

The other key issue of course is the necessity we have to reduce the resource and carbon intensity of the built environment by considerable amounts. We must liberate the creativity to do this by design, or resource availability at a price we can afford to pay as a society, will do it for us.

In all this a key point is being missed and this is the need to maintain and generate the ‘tacit’ skills our society requires as my generation passes from the scene. These are not created by this ‘Mitra’ process, powerful and vital though it is. Initiatives like Classofyourown are key to liberating these tacit skills as well.

These thoughts apply to all sectors of society of course not just construction, but the built environment does consume 50% of our resources.

Attached are two articles  that were in the Professional Engineers’ Handbook in 2005 and 2006. There is no point in my being unduly modest at this critical time and I feel they are both prescient and could have been written last week.

The third article attached is from the May 2008 edition of the CIBSE Journal and addresses the other key issue, our need to understand, as an industry the concept that the sustainability journey is just one of continual improvement towards perfect quality.

Kind regards

Derek

 Attachments

Sustainability and the Energy Gap sustainability-and-the-energy-gap2005

Building Towards the Future Sustainability, Building Towards the Future 2006

The Double-headed Coin Double Headed Coin – unformatted – BS

 

The Earth Equation by Jolito Ortizo Padilla ~ my appropriated words

 They say that “Imitation Is The Sincerest Form Of Flattery” and I take Jolito’s appropriation of my words, below, in that vain and with thanks. 

dd

The Earth Equation by Jolito Ortizo Padilla

All around us we are bombarded with messages telling us that we need to change, that the the earth is warming up. The messages are insistent and shrill but diverse, incoherent and all about our symptoms rather than the addiction we suffer: the hugely ineffective use of the resources that our one planet provides.

Clearly the earth as a system is dynamic and complex. Any attempt to describe it quantitatively and accurately is unlikely to lead to any clearer picture of useful action. What we need is a mind model, something that is powerful and evocative enough to provoke the right questions of societies, communities and organizations. Such a conceptual or mind model is the earth equation.

We are told that we are enjoying a “three planet lifestyle”- a lifestyle that consumes so many resources that we need three planets in order to cope. This tells us that what we are doing is not a sustainable state of affairs , but it is not clear what we need to do. 

We have in fact only one planet. If we look at consumption as an equation, the left hand side of the equation in a resource -constrained environment is always fixed at one. The right hand side of the equation is made up of population (P), its consumption of goods and services (C) and the factor that balances the equation -the resource intensity (I).

So at our starting point we have I=P x C x I, or I=I x Ix I. As we move forward from this point , the one planet remains the same, which means that the right hand product always needs to equal one. The only way this can happen in a resourced constrained environment is if the resource intensity is never allowed to be more than I divided by PC. In round terms, on predicted growth scenarios, we will need to reduce resource intensity by a factor of between ten and 100 by the year 2050.

Genichi Taguchi inspirationally made the observation and processes without loss were of perfect quality and, conversely , that less than perfect quality created a loss to society. In terms of this article, that loss results in an increased resource intensity.

We have thought of over the last 20 years or so that we can treat losses in processes and systems as separate. We have looked at quality as a function within an organization , focused on the customer, rather than that which maximizes the value added to society that results from the creation , use and disposal of products and services. Losses in processes and systems can be environmental, social or economic and are best minimized by seeing the goal of resource intensity reduction as a journey of integrated , continual , quality improvement.

These are the drivers of virtuous circle that using an organization’s stakeholders and their combined knowledge and skills, will enable process learning. This will then drive the process in the direction of sustainability. As the process becomes more sustainable , the losses are by definition minimized , reducing the need for appraisal costs and eliminating the costs and risks of internal and most importantly , external failures.

The message is clear: we have to change, but how? Our symptoms are plain for all to see but our addiction, the ineffective deployment of resources to create, use and dispose of the products and services we consume, remain untreated. Our task is simple, if not easy to accomplish, and can be reduced to key questions:
- Is our business model relevant to such future?
- Does our leadership and management enable the liberation of the creativity
required to continually reduce the resource intensity of the goods and 
services we produce , consume and dispose of?

This will need the most massive effort of quality improvement the world has yet seen. The earth equation is immutable , it drives our futures whether we choose to ignore it or not, and e have no option but to enter the future, either by design or negligence.

http://joepads.blogspot.com/2010/12/earth-equation-by-jolito-ortizo-padilla.html

see also The Big Q http://trailblazerbusinessfutures.wordpress.com/2009/12/17/the-bigq-%e2%80%93-leading-for-competitive-advantage-in-the-one-planet-world/

 

The end of ‘conventional’ growth

While it is true that Economic ‘growth as we have known it is over and done with’ as Richard Heinberg states below, it is important to recognise that in the resource constrained future we face, growth is possible within the limitations of the ‘First Law of Sustainability’ – that – goods and services can only grow at the rate at which their ‘Resource Intensity’ can be reduced beyond that needed to balance the ‘One Planet Equation’; see tab above.

Viewing our position this way gives us a clear focus on the actions we must take

• Reduce the resource intensity of non-essential processes to zero – eliminate them
• Work to continually reduce the resource intensity of those essential processes remaining by improving the ‘Quality’ of their creation, use and disposal.

dd

The End of Growth

Posted Nov 12, 2010 by Richard Heinberg

This article is an excerpt from Richard’s new book which has the working title ‘The End of Growth’ and is set for publication in July 2011. Given the urgency and fragility of the global economic crisis, we will be serializing the rough content as Richard writes it. Additionally, Richard will be offering ‘live peeks’ at the events and information that inform his writing process through Facebook and Twitter accounts created expressly for this publication.

The article was originally published as the MuseLetter #222

Introduction: The New Normal

The central assertion of this book is both simple and startling: .

The “growth” we are talking about consists of the expansion of the overall size of the economy (with more people being served and more money changing hands) and of the quantities of energy and material goods flowing through it.

The economic crisis that began in 2007-2008 was both foreseeable and inevitable, and it marks a permanent, fundamental break from past decades—a period during which most economists adopted the unrealistic view that perpetual economic growth is necessary and also possible to achieve. There are now fundamental barriers to ongoing economic expansion, and the world is colliding with those barriers…………

Full article http://www.postcarbon.org/article/178709-the-end-of-growth