Thursday, September 27, 2007

Friedman On Energy Efficiency - Walmart Style

NVDL: I enjoyed The World Is Flat, but I have to agree with James Howard Kunstler. Friedman may be the golden boy of the New York Times, but sometimes it's patently obvious that a substantial fraction of logic just isn't there. The same of course is true for the majority of Earth's human population.

Take this article on Energy Efficiency. Is Wal-Mart a poster child for energy efficiency? Not on this planet? On which planet are you Mr Friedman?

You see to even start talking about Energy Efficiency, the last company you want to give a badge is WalMart. Why? Because it's entire substrate is based on wasting energy. The Walmart's and Pick 'n Pay's may be the darlings of suburbia, but if you remember, it was these supermarkets that put local producers out of business in the first place. The bakers, the butchers and the candlestick makers all disappeared. In their place we got everything we wanted at low low prices - but shipped from far away. Canned goods, fishing rods and toilet seats from China, maize flower from the USA, wool from Australia and eletronics from Japan and Korea. Try get those things made locally. Try to find the local expertise. It's gone.

So all these things have to get packed and insulated - there's an energy input in itself - and then conveyed in massive metal crates on ships. These horizontal skyscrapers then lug all this stuff to harbors around the world, and then this stuff is trucked around to cities and stores. Who carries the cost? The planet. Cheap and abundant Oil runs these warehouses on wheels. So what happens when oil is no longer cheap, and no longer abundant? Answer: no more warehouses on wheels. Simple.

In fact far more efficient in the scheme of things is local farming doing its thing well and selling at local markets. It's healthier, and in the grand scheme of things, the overall costs - and YES THIS INCLUDES ENERGY COST! - is lower.

The future by the way portends the end of WalMart. When energy costs reach a certain critical level, globalisation will shift gears until it hits reverse. Then we return to local industries, and we turn to organic systems around us. Let's hope by then the planet's weather systems are still benign enough to allow us to try the local route. Given the neverending belching of exhaust fumes, and the temptation to turn to coal after oil, it's probable that we will attempt to farm the whirlwind.

Lead, Follow or Move Aside

China today is entering a really delicate phase on the climate-energy issue — the phase I like to call “The Wal-Mart environmental moment.” I wish the same could be said of America and President Bush.

Fred R. Conrad/The New York Times
Thomas L. Friedman
Go to Columnist Page »
The “Wal-Mart environmental moment” starts with the C.E.O. adopting a green branding strategy as a purely defensive, public relations, marketing move. Then an accident happens — someone in the shipping department takes it seriously and comes up with a new way to package the latest product and saves $100,000. This gets the attention of the C.E.O., who turns to his P.R. adviser and says, “Well, isn’t that interesting? Get me a sustainability expert. Let’s do this some more.”
The company then hires a sustainability officer, and he starts showing how green design, manufacturing and materials can save money in other areas. Then the really smart C.E.O.’s realize they have to become their own C.E.O. — chief energy officer — and they start demanding that energy efficiency become core to everything the company does, from how its employees travel to how its products are manufactured.
That is the transition that Lee Scott, Wal-Mart’s C.E.O., has presided over in the past few years.

Last July, Mr. Scott was visiting a Wal-Mart in Las Vegas on a day when the temperature was more than 100 degrees. He happened to notice that a Wal-Mart staple — inexpensive Styrofoam coolers — were not being promoted by the store’s associates. As Andrew Ruben, Wal-Mart’s vice president for sustainability, told me: “Lee walked into the store and said, ‘It’s 105 degrees. Why aren’t we selling any coolers?’ The associates said, ‘We don’t want to sell Styrofoam coolers because of their impact on the environment.’ So Lee called us afterwards and said: ‘We’re going to have to figure this out.’ By that he meant innovation of a different kind of cooler” that doesn’t come from petroleum-based Styrofoam, which is not biodegradable and usually not recycled.

Wal-Mart on Monday also announced a partnership with the Carbon Disclosure Project (C.D.P.) to measure the amount of energy used to create products throughout its supply chain — many of which come from China.

Said C.D.P. Chief Executive Paul Dickinson: “Wal-Mart will encourage its suppliers to measure and manage their greenhouse gas emissions, and ultimately reduce the total carbon footprint of Wal-Mart’s indirect emissions. We look forward to other global corporations following Wal-Mart’s lead.”

China’s leadership is not where Lee Scott is yet. Chinese officials still put their highest priority on growing G.D.P. — their bottom line. But for the first time, the costs of this breakneck growth are becoming so obvious on China’s air, glaciers and rivers that the leadership asked for briefings on global warming. Many Chinese mayors are looking to get clean-technology industries — like wind turbines and solar — started in their cities.

At such a key time, if the U.S. government adopted a real carbon-reducing strategy, as California and Wal-Mart have, rather than the obfuscations of the Bush team, it would have a huge impact on China and only trigger more innovation in America.

Mr. Bush will be convening his climate photo op — oops, I mean “conference” — in Washington tomorrow, which will include Chinese and Indian officials. But, as Rob Watson, the C.E.O. of EcoTech International, which works on environmental issues in China put it: “The Chinese are not going to take anything we say seriously if we don’t set an example ourselves.”

David Moskovitz, who directs the Regulatory Assistance Project, a nonprofit that helps promote green policies in China, was even more blunt: “The most frequent and difficult question we get in China with every policy initiative we put forward is: ‘If it is so good, why aren’t you doing it?’ It’s hard to answer — and somewhat embarrassing. So we point to good examples that some American states, or cities, or companies are implementing — but not to the federal government. We can’t point to America.”

Too bad. “It was America which put environmentalism on the world’s agenda in the 1970s and ’80s,” recalled Glenn Prickett, a senior vice president for Conservation International. “But since then, somehow, the wealthiest and most powerful country on the planet has gone to the back of the line.”

Leadership is about “follow me” not “after you.” Getting our national climate regulations in order is necessary, but it will not be sufficient to move China. We have to show them what Wal-Mart is showing its competitors — that green is not just right for the world, it is better, more profitable, more healthy, more innovative, more efficient, more successful. If Wal-Mart can lead, and California can lead, why can’t America?

NVDL: Because the thinking there is faulty. The thinking is based on previous investment, when everything must be overhauled. Lifestyles must change, and naturally, Americans don't know how to do that. Not many do.

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