If you haven’t yet come across the comedian David Mitchell’s short ‘SoapBox’ on climate change then I recommend you take a look. But behind the humour lies some serious points. Much of the environmental challenges that we face “aren’t much fun”, as he puts it, and mean that we can’t enjoy “fossil fuel burning big fast metal things” as much as we might like. The other point that he makes is that policies addressing climate change are often championed by people who seem “at least a little bit pleased by it” as an opportunity to wag their fingers and say ‘I told you so’.
It is difficult not to have some sympathy with his position, but his advice to confront the grim and depressing facts of climate change for what they are, does also obscure the scope and potential for new technologies to help solve the problem while also improving lives. This potential exists because of the incredible wastefulness of the way we currently run our economies. Fully two-thirds of all primary energy is wasted through the process of conversion into actual useable electricity.
In part this is due to the laws of physics, but it is also because we’ve never really cared that much before. The opportunities for massive improvements in efficiency are virtually endless. When a person uses an average car to travel, approximately one quarter of the available energy is used to move the car down the road. If the person is using the car to get from A to B then approximately one per cent of the energy consumed is actually used for transporting the person, the rest is used to transport the car.
There are similar opportunities for electric motors, which are the single biggest consumer of electricity and account for about 45% of global power consumption. In the UK alone some 10 million motors consume £4 billion worth of electricity annually. Often these motors have a single speed – they are either running 100% or they are switched off. By simply installing variable speed drives that can alter their capacity to suit the task at hand, savings of in excess of 60% of the energy used can be made.
LED lighting, a technology that we have covered in previous blogs, is another area where savings in excess of 80% can be made while simultaneously providing higher quality, more adaptable lighting. Sending food waste to landfill has already largely been eliminated by several of the UK’s large supermarkets. Instead the waste is being fed into anaerobic digestors that produce biogas as an energy source and digestate as an agricultural fertiliser.
I am not pleased about climate change, but David Mitchell is right about one thing, climate change is definitely “a really depressing thing that is happening”. Lifestyles already are adapting both to accommodate the climate as it changes, and to alleviate the more severe impacts. But to treat combatting climate change as a dreadful chore overlooks two things: the enormous capacities for technological innovation that are only just beginning to be directed at increasing resource efficiency, and the incredible and unnecessary profligacy with which most economies are currently run.
Risks include: the price of shares (“Shares”) in FP WHEB Sustainability Fund (“Fund”) may increase or decrease and you may not get back the amount originally invested, for reasons including adverse market and foreign exchange rate movements. Past performance is not a guide to future returns. The Fund invests in equities and is exposed to price fluctuations in the equity markets, and focuses on investments in mid-sized companies in certain sectors so its performance may not correlate closely with the MSCI World Index (the Fund’s benchmark). For full risks, please see fund prospectus on www.whebgroup.com.
General: This blog, its contents and any related communication (altogether, the “Blog”) is issued by WHEB Asset Management LLP (“WHEB Asset Management”). It is intended for information purposes only and does not constitute or form part of any offer or invitation to buy or sell any security including any shares in the FP WHEB Sustainability Fund, including in the United States. It should not be relied upon to make an investment decision in relation to Shares in the FP WHEB Sustainability Fund or otherwise; any such investment decision should be made only on the basis of the Fund scheme documents and appropriate professional advice. This Blog does not constitute advice of any kind, investment research or a research recommendation, is in summary form and is subject to change without notice. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming shares. WHEB Asset Management has exercised reasonable care in preparing this Blog including using reliable sources, however, makes no representation or warranty relating to its accuracy, reliability or completeness or whether any future event may or may not occur. This Blog is only made available to recipients who may lawfully receive it in accordance with applicable laws, regulations and rules and binding guidance of regulators. WHEB Asset Management LLP is registered in England and Wales with number OC 341489 and has its registered office at 7 Cavendish Square, London, W1G 0PE. WHEB Asset Management LLP is authorised and regulated by the Financial Conduct Authority with Firm Reference Number 496413. FundRock Partners Limited (formerly Fund Partners Limited) is the Authorised Corporate Director of the Fund and is authorised and regulated by the Financial Conduct Authority with Firm Reference Number 469278 and has its registered office at 8-9 Lovat Lane, London EC3R 8DW. The state of the origin of the Fund is England and Wales. The Representative in Switzerland is ACOLIN Fund Services AG, Affolternstrasse 56, CH-8050 Zurich, whilst the Paying Agent is Bank Vontobel Ltd, Gotthardstrasse 43, CH-8022 Zurich. The relevant documents such as the prospectus, the key investor information document (KIIDs), the Articles of Association as well as the annual and semi-annual reports may be obtained free of charge from the representative in Switzerland.
The MSCI information may only be used for your internal use, may not be reproduced or re-dissseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis should not be taken as an indication or guarantee of any future performance analysis, forecast or prediction. The MSCI information is provided on an “as is” basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the “MSCI Parties”) expressly disclaims all warranties (including, without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages (www.msci.com