Interview

TO SPEED UP POLICY CHANGE GREENTECH MUST ENGAGE WITH BIG BUSINESS

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Connie Hedegaard, as Denmark’s first Minister for Climate and Energy from 2007 and the EU Commissioner for Climate Action from 2010 to 2014, pushed spending on climate change mitigation into the political mainstream. Under her watch the climate-related share of the EU budget was raised to 20%. Having laid the groundwork for Europe’s climate policies, she is calling for the “externalities” of energy use to be included in economic modelling and for greentech to step up and make its voice heard. In conversation with FORESIGHT, Hedegaard explains how.

Q: What are the main barriers hindering the global transition towards a fossil free economy?

A: I think one of the biggest challenges is that we need to get better at pricing externalities. Externalities need to be incorporated in tax systems and we need to improve the way we use life cycle assessments in public procurement. These instruments ought to be integral to how finance ministries conduct economic modelling. Too often recommendations from finance ministries are short-sighted and we need to include long-term effects.

But as we speak, some of the largest barriers have actually already fallen. The price of renewables has fallen drastically in recent years and in combination with the Paris Agreement, the UN Sustainable Development Goals, and the fact the all EU countries are presenting national energy plans, this shows that we have overcome many of the earlier barriers. That is why I think the most pressing obstacle right now is to maintain the political focus. Politicians are overloaded with all sorts of serious and pressing problems. For example, just consider the amount of time, resources and political focus that goes into preparing Brexit. So it’s very important not to lose focus on the long-term challenge of climate change.

Another important and often overlooked barrier is the mental barrier. The science of climate change has been done. The economic case for a renewable-based energy system has more or less been done. What we are missing is the behavioural case. What is it that ensures that we act on what we know and that we are willing to change our behaviour? I don’t believe in top-down policies. It’s absolutely crucial that we as citizens get engaged. One thing is to price pollution and get our national climate policies aligned with tax systems, but even then, there is the component of the individual’s choice. And we need to improve our understanding of this component.

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Q: As EU commissioner you succeeded in mainstreaming climate action into the relevant policy areas and getting 20% of the EU budget focused on climate change in the midst of a global financial crisis, high unemployment and other pressing issues. How did you succeed in not only maintaining a climate focus but getting it to the top of the agenda?

A: To begin with I did not think the idea would have a chance. It just goes to show how important it is that you have a critical mass of high-level politicians who are aware and talking about these issues. It is also very important to note that climate action is not about de-growth. It’s a new way of generating growth and when you’re able to show the economic case for action then it is possible to succeed and persuade others. This is how we succeeded with the mainstreaming agenda. It was a major arm wrestle within the Commission. A lot of preparation and political capital went into that process.

“It is almost built into the system that
large companies will lobby to avoid
too many changes”

Q: Well, that sounds relatively easy. Prepare your case and reason will eventually prevail. If that’s the case why would we need to stress the importance of climate policies even more now than back in 2010?

A: It was essential that we could show that investing in a greener economy would create more jobs, give us a technological edge, improve innovation and potentially weaken our dependency on Russian gas. You need to present different arguments for the different stakeholders. It probably took one-and-a-half years from when we first introduced the idea of mainstreaming climate action into the relevant sectors at a seminar in the Commission until it ended up included in the EU budget. To get climate policy mainstreamed into the entire EU budget is a pretty big thing.

The take-away is that these systems are not as bureaucratic and complex as they are often made out to be. And sometimes the EU Commission is able to think more long term than, for example, member states. Many industries might not be the biggest advocates of ambitious climate policies. It is almost built into the system that large companies will lobby to avoid too many changes, but new companies that might be big companies five years ahead do not have the strength to roll out a targeted lobbying effort. So, there is a problematic asymmetry between those that defend the current set up and the green companies of the future.

Q: What would your advice be to the future companies that focus on selling renewable energy?

A: They should continue to push their agenda and try to find common ground with like-minded companies. One of the main challenges is counteracting the influence of some big pan-European lobby organisations. BusinessEurope is a very large lobby organisation and sometimes they tend to represent the interest of fossil fuels instead of renewables. I think it is very important that companies selling renewables increase their focus and effort within these organisations to make sure that their voice is heard. I understand that this is not the first priority for the entrepreneur who just invented a new smart device, or a small greentech company, but it is very important to get engaged in these industry associations and the political process if you want to get heard.

Q: You have spent a large part of your adult life dealing with energy and climate issues. Why did you choose to dedicate so much of your time to this particular cause?

A: The more you learn about the challenges posed by climate change, the more you realise how serious it all is. I became energy minister in 2004 and I attended my first climate conference in Buenos Aires, Argentina, and I thought it was a nightmare. I hated it. I had recently learned about how urgent the matter was and then you enter the UN system, which is anything but fast. But a small group of dedicated people can change things and I thought it was fascinating to try to change things for the better at an international level, but also at the European and national level. •

PHOTO Lars Just