Carbon Economy Summit, Washington
| GBS Bindra, Global Innovation Director, Logica, addressed the distinguished gathering at the Carbon Economy Summit held at Washington DC on November 18, 2009 | Key Events |
For as long as we can see back in history, man has derived his wellbeing from burning things. Warmth, Light and Mobility have been fundamental to our economic prosperity. And for the last 150 years, carbon has been the fundamental basis of our economic prosperity. We have to decarbonise this world, if we don’t want to do irreparable damage to our planet. Clearly, we are all here because we know we have to decarbonise this world.
A careful look at controllable emissions from every American household shows that 51% of all emissions come from motoring. Emissions from Transportation in EU increased 25.8%. The transport sector remains a major cause of emissions.
The challenge cannot be solved only by innovation in technology areas. We have to have a holistic approach to solve these challenges and attack them from various directions. Scientists and engineers need to solve technology issues around creating new kinds of transport devices, or new kinds of power plants based on renewable sources, or reformulate gasoline.
The challenge could be solved by changing how we think, live, work and play. To a very large extent the trend would be arrested by people changing their behaviours. And also to a very large extent by altering behaviours.
Leading the way is innovation in new business models for a low carbon, resource efficient economy.
We are all here in the session to debate and discuss if the new business models can indeed create the biggest economic opportunity for this world...for not only the industralised world but also the developing world. This requires an innovation in collaborative eco-system.
The new model – Logica EMO - provides feedback on your driving style in real time while you are driving so you can alter it for better driving rather than wait for the output at the next tank fill.
We all ought to consider carefully how we drive our car because every citizen should bear the full cost of driving along with wear and tear, and the congestion and emissions we cause. To encourage all motorists to switch to better driving, Logica EMO will reduce carbon emissions by 1.7 million tonnes of carbon. This is how it will work.
Fuel Price = Cost of fuel + Fuel tax
- A country equipped for the future should also have a modern tax system based on that principle
- The tax system sends critical signals about the economic activities that a society wishes to promote and deter
- Shift the burden of tax from “good driving behaviour” to “bad driving behaviour”
- This is different from one time road tax currently in vogue
- One time tax does not alter long term behaviour
- Government could expand the scope for using the tax system to deliver environmental objectives - as one of the key instruments in combination with others like regulation and voluntary action
Logica EMO creates a multi-pronged financial incentive infrastructure. It can significantly reduce global emissions, but enabling frameworks and specific policy responses are needed to support their rapid deployment, in both developed and developing countries. This is aided by capturing driving behaviours and corresponding emissions in real time and transmitted over a wireless network. Now the back-end data could be used by Oil companies and Governments to offer differential fuel price and or by Oil companies to accelerate Fuel Loyalty Points. Or the Insurance companies can use this data to realign the vehicle premium.
The case for differential fuel pricing - The idea of using price to regulate people’s behaviour grew in popularity in the 1980s, when at least in the US and UK, free market economics replaced government regulation as the favoured means of achieving social objectives. A favourable differential for unleaded petrol since 1987 has significantly reduced the use of leaded petrol - which was the major source of lead in the atmosphere over the last decade. The success of this policy helped facilitate the phasing out of leaded petrol on 1 January 2000, in line with the EU directives. As a result of these measures, lead emissions from traffic have been cut to almost zero, with older cars which are unable to use unleaded petrol switching to lead replacement petrol.
Fuel taxes reduce carbon dioxide emissions in two ways: they have a short-term impact on the number of miles driven and, in the longer term they encourage more fuel efficient vehicles and inculcate good driver behaviour. It is by giving this incentive for cleaner fuels that we can both advance our environmental principles and ensure--with the 3p cut per litre in all ultra-low sulphur duty--a cheaper cleaner fuel available in every garage, a better deal for drivers and cleaner air across the world.
And how do you drive the right behaviours: again there could be multiple approaches and business models - could be to reward compliance rather than penalise non-compliance; make it financially attractive to be compliant; develop a business model in which private good drives public good. But clearly for an individual citizen across the industrial divide, it needs to cost less to be green than not to be.
Let’s examine what drives consumer behaviour with respect to societal good. Humans want “to participate, to play a role in what is going on around them”. They however do not want to feel “incompetent and helpless” when they do. Logica EMO facilitates “participatory problem solving” to motivate desired behaviours by enlisting people to be a part of the solution. It tracks and reports on results – on an individual or collective basis – to create a sense of accomplishment. For example, tracking net reduction in greenhouse gas emissions from hybrid car or renewable energy use may motivate others to participate rather than remain on the sidelines. Logica EMO allows you to celebrate success.
Logica EMO green index will become a benchmark in the future for differential fuel pricing, tax on the vehicles, insurance premiums and many more. How green we are will be measurable.
There would be readings from the EMO Green Index on various social media. It will become the new statement on “who you are”. Visualise people wearing their Logica EMO rating with pride on their social profiles (on facebook, myspace, twitter). They compare their rating with others and friends, also enabling the entire ecosystem to be aware. This could be our future. It also becomes a benchmark for new offerings to drivers.
It is clear that any new business model to change behaviour in a significant way must – Enlighten, Engage and Empower.