Timmermans is Europe’s climate Czar, even if names refering to Russia may not be in vogue. Fossil Europe is preparing to utilize gas from Russia, and Holland, the country Timmermans is from, maintains a balance between criticism and expressions of friendship to Russia (and most if not all other countries). Timmermans is an EU machine. A worker that committed to the EU and its democratic processes. Now he has presented an interesting carrot and stick to get climate action moving : A Trillion Euro fund.
The trick works like this : Many will say “How can we reserve such vast amounts of money”. But in the back of their minds they will think “Wow, that is a nice fund. If we lobby to create it, we can also take money out!”. Member states will find themselves arguing how to pay for it while also fantasizing what to do with the cash! We hope that will work!
At the same time we know that the economy can not fix climate change. The simple reason is that the economy is based on fossil credit, carboncredit as we call it. If you want to produce something, a car for example, you need energy to make machines work, to heat the homes of your workers, to melt the steel. And that energy is distributed through our Euro. The Euro is still 75% Nuclear/fossil credit in Europe. If you say “We will reserve a trillion for climate action” you are taking an enormous cut out of the fossil reserves and allocate it towards fixing climate change. But of course you will burn those fossil fuels. So there are three problems with the 1 Trillion :
- It represent fossil fuels you don’t want to burn
- Banks influence the value of that trillion by printing more money
- Companies want the money to go towards business as usual
So the likely scenario in the current economy is that there will be about 400 Billion to dole out at first. Maybe less. Then that will be doled out towards fossil intensive projects (they are always preferred by banks because they generate more cashflow). Infrastructure builders will be on the first row with some mega project. Massive amounts of CO2 will be emitted. Little will be achieved in time to have true effect. The economic doctrine is deeply ingrained in so many that there really needs to be a clear alternative approach, that takes a little time to grasp. Back to school so to say!
If you take a Tesla approach, and you are mentally paving a road over greenfields (or grayfields) because you consider the fossil based system obsolete, you need to create the conditions for speed in the future now. Like Tesla started a Giga factory because it understood batteries would be the limiting factor, the first order for Timmermans is to establish a calculation of battery solution feasibility for essential industries (not GDP essential but real economical!) and plan construction of battery production, solar panel production, wind turbines for a massive growth curve. This will give bankers a heart attack, it makes their carboncredit obsolete, but it also ensures execution can be fast and living standards can remain high.
As the above happens the search must be for ZERO fossil input ways to deal with climate change. You can’t support CCS, it is a temporary measure and the transition to renewables is for eternity. Solve the problems in one step, not in economically attractive (cash flow generating) non- solving ministeps, such as moving from coal to gas, from gas to gas-hydrogen. That’s just the fossil banking system wanking.
The transition to organic farming, soil carbon sequestring methods, ways to capture carbon at sea, etc. have to be rolled at scale, while solutions are found for the increasing droughts and floods. Scientific institutions can prove worthless if they are kept afloat by fossil industry money, or if they have been put into debt by banks. They will sell ideas they get handed by those banks. Looking at the basic research though is not expensive and so it makes sense to create young teams to figure things out. Let them use models to simulate the effects of choices, in fact we think the EU should reach out to Microsoft to develop an Earth Sim, based on the new MS flight sim that has real time weather and hyperdetailed maps.
So how do you really sequester large amounts of CO2 without using a lot of fossil fuels? We think the solution can be found offshore, in growing seaweed or other plants. This needs to be given a real budget, with the aim not to be profitable but to be self sustaining and effective. This is possible because if seeweed will grow (water not to hot), the yield per hectare is considerable. Processing it at sea means the BCS (Biomass Carbon Sequestration) effect can be optimal. The size of this operation has to be as large as possible. A 1 billion Euro fund can really get this going.
But to get to the title of this post, we thought about how to extricate the activities from the influence of the carboncredit system, the banking system. We wrote about this in 2012.
The Euro is fossil fuel credit. Its ability
to buy fossil fuels is key to its value
The basic idea is that money is meant to make asynchronous trades possible. That means that if you have a loaf of bread, and I have a piece of chees, I can first sell my piece of chees, get a Euro, then use the Euro to buy your loaf of bread, and you can use the Euro to also buy a piece of cheese. The amount of money has to somehow follow the ability to produce goods and services to avoid inflation. Not to little or people get stuck with stuff, not to much or paying will be a hassle. This use of money is the most important for the real economy.
The question then becomes, what are the dynamics of different sources of productivity. you have human labour, fossil energy, renewable energy (and others of course). In principle each should have their own currency. The big problem with loss of jobs and income at the moment is partly because people get payed in the same currency as machines : Fossil fuels, but machines need much less! Humans compete with fossil fuels for the same money (an automation company can say “Our machine does the job of three humans, it’s value is at least one human times five years!”).
There should therfore be a separate currency for human labour, the Auro. The amount of which should track the true productivity of the population. This way humans do no longer compete with machines, and there is no dependency on fossil credit to exist at all.
The Auro is named after gold, because historically the amount of gold was relatively constant, just like the population and its productive capacity
The same goes for renewables. The productive value of wind turbine electricity depends on how far away you are from the turbine. It has no storage so the line losses mean that if you sell 1 kWh you need to produce more the further away you sell it. Even if a gas powerplant in the South of Holland needs to power a factory in the North it has to produce more MegaWatts than the factory will register. Also renewables can be bought and payed for. Then the energy can be sold by the owner, no bank debt or credit should be involved. That means there should be a currency for such renewables : The Joule.
Renewable localised energy is traded in Joules. The Joules are allocated by the tax office because the calculation needs to be precise. It is then up to the owner of the RE source to ‘sell’ them. Of course the government or EU can have a Joule bank based on EU RE sources
Now if Timmermans wants to create a new RE based economy, he is wise to also create a new bank, the Joule bank. He can then organize the mass production of RE energy sources, to be owned by memberstates, and introduce a Joule based credit system that is run by the same. To by the new RE one needs Joules. This way the new system does not feed into the existing fossil banking system, with all kinds of deleterious effects.
The use of the Auro is a more complex matter, basically anyone will have three balances, for the Euro, Auro and Joule, and apply them in combinations. For instance a european flight costs Euro for kerosine and Auro for the stewardess and ground crew.
Even if the above seems complex, there is truth in its necessity. It makes no sense to keep mixing the trade of fossil energy (the price of which is arbitrary because production of one barrel can cost between 1 and 10 barrels of oil) with that of renewable energy. Like with human labour, fossil fuels is unfair competition.
The way a carbon tax works can then be translated into Euro’s from the fossil economy being made available to the Joule economy. Fossil energy resources that can be used to make Renewable energy sources. That means that the transition has a steady control over fossil resources, even if banks decide to try and inflate the CO2 cost away. To be continued!
If anyone wants to create a virtual currency we own realcarboncredit.com and climatecoin.nl 😉