Sustainability moving up the agenda
By stephendavis on Nov 06, 2006
The debate surrounding climate change and how businesses and individuals can help reduce their carbon emissions seems to be gathering pace. Last week, Nicholas Stern published his committee's report for the UK Treasury on the economics of climate change. In the report, he called for urgent action by governments and corporations around the world to reduce the current level of CO2 emissions.
His findings necessarily require changes in the economic framework that will impose costs on those activities that create the most environmental damage, i.e. green taxes. It is a fact of social life that the majority of people will not change their behavior for purely altruistic reasons. Even if some do, it is argued that their actions will be offset by others who continue for example, to drive 4x4 cars around the streets of Central London.
Politicians know that voters will tell pollsters that they are willing to pay additional taxes to help fund improvements in the health and education systems but at the ballot box will invariably vote for lower taxes. This is despite the fact that in the past 20 years, the main party that has promoted lower taxes has subsequently raised them for the vast majority of voters when in office.
At the current point in the debate, it will still take a brave (and some might say foolish) politician to advocate raising taxes on air travel. As loss leaders, low cost airlines regularly advertise £1.00 return flights to many European destinations that clearly are offered at below cost price. At present, Kerosene the main aviation fuel used by airlines is not taxed anywhere in the world. If the UK were to impose a tax on aviation fuel ahead of the rest of the EU member states, in the longer term it could adversely affect the UK's position as the main hub for long haul international travel out of Heathrow.
For Google, energy costs are now their second largest cost behind computer hardware. It has been reported that Google is locating its datacentres near to steel plants to ensure a stable, high power electricity supply. Similarly, the financial district in Canary Wharf in London now consumes the same amount of electricity as the whole of Wales. Energy costs are now moving up the business agenda for many companies that until recently considered them only to be a political issue.