A Review of “Energy and the Common Purpose – descending the Energy Staircase with Tradable Energy Quotas (TEQs)” – David Fleming. The Lean Economy Connection (2005)
Here is a review of David Fleming’s new book. It is highly recommended.
On the surface, the issues of climate change and peak oil call for very similar responses. It is, after all, about reducing the use of fossil fuels. However, there are differences, highlighted in the Government’s recent announcement that it will begin a new programme of nuclear power plant building. On the face of it a good solution to climate change, it brings the UK’s carbon emissions in line with international agreements and business-as-usual can continue. From a peak oil perspective however, it is no solution at all. Nuclear power plants take 20 years to come on stream, peak oil is estimated for sometime between now and 2010. Our transport based economy needs cheap oil, not nuclear power. Running the nations cars on hydrogen made from nuclear power would require 100 new nuclear power plants, not the 10 that are proposed.
Thinking about both climate change and peak oil requires new thinking and new mechanisms. David Fleming’s “Energy and the Common Purpose” is an excellent example of new thinking in response to a new problem. Economist David Fleming has designed a mechanism for a 21st century rationing system which he calls Tradable Energy Quotas or TEQs, (pronounced ‘tex’). TEQs take the concept of rationing and bring it up to date combining modern technology and the need for drastic cuts in energy consumption.
Fleming’s approach is well thought through and offers the clearest such mechanism yet outlined. In brief, it is an electronic system for rationing energy. Every adult is allocated an equal number of units whereas the Government and industry have to bid for theirs at a weekly tender. Everyone has a card, like a credit card, which must be produced every time energy is purchased. Your account is then debited accordingly. If you use more energy than your quota you can buy them from those who haven’t used all of theirs. This all happens electronically, with the minimum of hassle. The number of units available is set out in a 20 year budget, which sets out how every week they get slightly less, in keeping with the pre-agreed 20 years Energy Budget.
Colin Campbell of the Association for the Study of Peak Oil recently proposed what he calls the Oil Depletion Protocol (it can be read online at www.peakoil.ie). This would essentially be an international agreement by which oil exporting nations would agree to restrict their exports in line with an internationally agreed depletion rate. At the same time oil importing nations (a club the UK recently joined) agree to gradually reduce their imports accordingly. The Protocol would seek to reduce profiteering among exporting nations, and also ensure that the poorer importing nations still had access to oil rather than being priced out of the market. Campbell’s Protocol was recently presented at a conference of the international oil industry, but found itself sidelined and has yet to be ratified. It is similar in many ways to the Contraction and Convergence mechanism which aims to reduce climate change through international agreement to cut carbon emissions, but which is better known and which seemingly has more chance of being ratified.
What is required to enable us to be in any kind of a position to withstand the imminent contractions in oil supply is a mechanism that achieves the necessary cuts in oil consumption required for a steady contraction of the economy and which also brings CO2 emissions down to the 80% reduction required by 2050. Any mechanism that enables us to do this must be easily implementable, capable of being marketed as a positive step that isn’t a hassle, and widely seen as fair?
The much touted Carbon Tax, while it may bring about the required reductions in CO2 emissions, is a grossly blunt weapon with which to achieve it. It penalises the poor, while the wealthier are more able to continue their lifestyles unfettered. It is widely seen as unfair, and can generate a great deal of bad feeling towards both the mechanism and its objectives. Also, Carbon Taxes are only appropriate when oil supply is guaranteed. The time to tax something is when there is a lot of it about but you want to reduce demand. Taxing a diminishing resource makes no sense at all. The alternative to a Carbon Tax is a rationing system. When rationing was last introduced in the UK, circumstances were very different, and so was society. People were less individualistic, more likely to endure what is seen as State ‘interference’, and, of course, we were faced with the imminent possibility of invasion.
Fleming argues that for the first few years after the introduction of TEQs, people will hardly notice any difference. Indeed, for people living more efficiently it amounts to a rebate rewarding good practice. What TEQs do over the first few years is start to focus the mind – as Fleming writes, “they call on each of us to be (at least) a little bit of an energy expert, a little bit of a visionary”.
If you run a small business, your TEQs can be counted as a business expense in the same way as other such expenses are at present. Again, it focuses the mind on how the business will need to adapt to what is a clearly laid out timetable of diminishing oil availability. As Fleming argues, TEQs ‘concentrate the mind; they make planning ahead a necessary business skill; they make it second nature”.
One of the things that TEQs can do is create the basis for a collective motivation, a common purpose of living within an energy budget. It means that it is in individuals’ interests to help others reduce their carbon dependency. It incentivises co-operation over competition. This is seen especially clearly in the possibilities for neighbours or communities to pool their TEQs into a local fund for energy conservation or renewable projects.
Fleming’s book is an excellent overview of the TEQ concept and its practical implications. It is short, its 34 pages fit within most peoples’ attention spans. It is clear and concise and it answers most of the questions you might have on the subject. This is an idea that is extremely well thought through and could be rapidly implemented.
It offers the promise of the Oil Depletion Protocol via a different avenue. It means that in the absence of an internationally binding agreement to begin to reign exports and imports within the curve of depleting resources, communities and local authorities can take these depletion rates as the benchmark against which to measure the success or otherwise of Energy Descent Action Plans or whatever ground-up mechanism is designed to facilitate this transition. The Oil Depletion Protocol and our bottom up efforts can meet in the middle.
When the UK Government appears to have decided that the future is nuclear, and that our standard of living is non-negotiable, TEQs could well constitute the key for a national Powerdown process, if there was the political will to implement it. It would be a very skilful Government that could get elected on the promise of offering a contracting economy – however if the will for living within the decline curve of the depletion protocol was demonstrated at the community level, it would appear more feasible to Government.
Once again, this boils down to the essence of our work as permaculturists, that is showing by example, story, myth, lifestyle, speech, images, song, film or natural buildings that life without oil can be a preferable place to where we are now. If I have one criticism of this book it is that Fleming doesn’t really articulate how life could be at the end of this process. If you want someone to go on holiday with you, you don’t tell them about how great the airports are that you’ll be passing through and about the inflight magazines, you tell them what a lovely place it is that you are going to and what a great time you’ll have when you get there. This book offers an excellent, workable and common sense mechanism for making this transition smoother, but what might life look like when we reach the end, and have made the 80% reduction? For most people it is impossible to imagine.
It came up in conversation with a friend recently that neither of us could think of any film that showed a vision of the future that was in any way like the kind of future that we are talking about here. Star Trek’s visions of Earth in 2070 or whenever are all about technology running rampant, or other films that show apocalyptic wastelands, science gone mad; Star Wars 2 with its multilevel traffic jams, Mad Max, even the children’s’ film Transformers (truly the worst film I have ever had to endure) which portrays the future as endless war between half-men/half-robots. We could think of no film that showed a future of people living in a low energy way, with food gardens and localised economies. Funny how more able we are to visualise that than what could actually be a desirable future for us all. I think that is an essential part of this work, articulating that vision of the future in a way that makes it easy for others to see it too. In fairness that is what Fleming does in his magnum opus, The Lean Economy, which is yet to be published but which sets out a bold vision of how a low energy future might feel, look and function.
I recommend this book without reservation, and David deserves all our praise and support for thinking this approach through in such a way that it is this watertight. It is an idea that deserves to be spread as widely as possible, as it is an idea of its time. Take the time to read and understand this mechanism thoroughly, it is a powerful tool to counter the arguments that the only way to maintain our ‘standard of living’ is to build new nuclear power stations or introduce unpopular and self defeating Carbon Taxes. New situations require fresh thinking.
This review will appear in the forthcoming issue of Permaculture Magazine (issue 47)
Update - 5th December 2005. You might like to look at this article which appeared on the BBC website the other day about Qutoas