5 difficult but feasible steps to reverse the climate crisis

The actions called for will be hard and complex, but they are ultimately essential to any serious solution to the climate crisis

By Darden School of Business

Published: Jul 5, 2023 10:32:30 AM IST

Updated: Aug 14, 2023 03:04:47 PM IST

A series of actions require cross-sector collaboration to create immense value for our society — and the world Image: Shutterstock

Canada is on fire, California is flooding and Greenland’s glaciers are rapidly retreating. The effects of climate change are everywhere, and yet a coordinated and cohesive response to the single biggest threat to life on Earth is nowhere to be seen. The scale and scope of the crisis leads many to paralysis. The only rational way to deal with a crisis of unfathomable proportions is to ignore it, many have decided.

We don’t fault those who simply refuse to consider solutions to a problem that inevitably comes with a heaping side of existential dread.

In an effort to chart a course both dramatic and pragmatic, a broad set of experts at this year’s Jefferson Innovation Summit at the University of Virginia looked through the other end of the telescope to identify a series of actions that require cross-sector collaboration in service of the ultimate moonshot. The actions called for will be hard and complex, but they are ultimately essential to any serious solution to the climate crisis.

Here are five key opportunities to create immense value for our society — and the world — pulled from the final report.

1. Modernize the Electric Grid.

Wind and solar power are increasingly becoming the cheapest form of electricity generation around the world. And the clean energy transition is looking increasingly likely. Now we have the opportunity to increase its speed by redesigning our electric grid to be nimble and more responsive to multiple point sources that are intermittent by nature.

Investment in long-duration energy storage and grid-edge technologies would allow for energy trading and bidirectional communication, a critical improvement. Reducing demand through energy efficiency measures closes the gap between where we are now and decarbonization.

This isn’t just a technological challenge. It is also a regulatory one, which gets us to our second action.

2. Reform Electricity Permitting.

In 2021, the interconnection queue — a database of power generation and transmission projects requesting grid connection — held 1,400 gigawatts of generation and storage projects, 90 percent of which were renewable energy projects. On average, however, new grid capacity projects take four years to be approved.

But with regulatory changes, we can move clean energy projects through the pipeline more quickly. Improving coordination across state lines and between state and federal agencies while prioritizing projects with robust financial backing would reduce the time it takes for a project to move from application to breaking ground.

Energy storage projects often face additional delays from out-of-date zoning ordinances. Business leaders can lend a strong voice and perspective to updating regulatory review processes.

Also read: Financial time bomb: The risks of climate inaction to the global economy

3. Reform Agriculture Policy.

Agriculture is both greatly impacted by drastic weather changes driven by global warming and a significant contributor to climate change, accounting for 25 percent of global greenhouse gas (GHG) emissions. From indoor vertical farms and genetic crop breeding to drones and lab-grown meat, there is significant technological innovation already happening in this sector.

But targeted public and private investment can help rapidly scale these new technologies while simultaneously halting further deforestation of critical carbon sinks, valuable for absorbing more carbon than they release.

Perhaps the biggest influencer in this sector is the consumer. Shifting purchasing and eating habits will ultimately determine the speed in which we decarbonize this sector.

4. Promote a Circular Economy.

Plastic waste captures headlines around the world. What is often missing from these stories is recognition of the climate impact of carbon-dioxide-emitting plastic manufacturing. Recycling has been in play for decades, but absent customer demand for goods made with recycled materials, we’re still left with mounds of plastic.

The answer could be creating a circular economy, which is a win-win for material waste and climate change. Simply put, if you design a product with recycling in mind and use materials from the old to create the new, you can both eliminate waste and reduce manufacturing emissions, thus closing the loop.

A change in consumer behavior combined with changes in the retail business model can help make circularity commonplace.

5. Establish a Price on Carbon.

Carbon pricing has been debated for decades. In recent years, we have seen widespread adoption of carbon reduction policies around the world. In 2022, more than 70 carbon pricing initiatives were in-play, impacting potentially 23 percent of global GHG emissions. Yet in the U.S., proposals for carbon pricing continue to be met with resistance.

We need a different tactic. A tactic that provides the business community with the opportunity to lead in lieu of government action. The E-liability system is a novel approach that applies accounting principles to GHG emissions, treating them like liabilities and requiring companies to track and balance them at each step of the value chain. The idea is that firms will then manage their emissions liabilities against company assets.

Transparency in disclosure and buy-in from the investment community can jumpstart this approach and generate broader acceptance.

This article was developed with the support of Darden's Batten Institute. Lenox and Duff co-authored the book The Decarbonization Imperative: Transforming the Global Economy by 2050.

[This article has been reproduced with permission from University Of Virginia's Darden School Of Business. This piece originally appeared on Darden Ideas to Action.]