Introduction:

This was a seminar held on the 8th of November with an illustrious panel including Colin Matthews, CEO at BAA, Paul Nash, Head of Airbus New Energies, Martin Powell, Advisor on the Environment to London Mayor Boris Johnson, Jonathan Counsell, Head of the Environment at British Airways and Steve Howard, CEO at The Climate Group. British Airways CEO, Willie Walsh, presented the introduction.

I found the seminar a rather gloomy affair that neither covered the subjects of economics, low carbon or enablement. Instead, the discussion centered around how the industry was going to cope with a rapid massive expansion in the demand for air travel, whilst tipping its hat to the ecological needs of our environment. The message was clear; ‘London business first and foremost’.

The statistics from the panel stacked up as follows:

• Global population growth is going to go from its current 6 billion people to 8.9 billion by 2050.
• Global consumers will increase from around 1.5 billion people to a forecast 5 billion during this time.
• Emissions from the aviation industry will continue to rise for the next ten years at least.
• Jet engines will become 1.5% more efficient at burning fuel per year.
• Bigger aeroplanes and a 3rd runway at Heathrow will increase the throughput of people leading to efficiencies in fuel used per customer unit.
• Other technologies, such as biofuel may help reduce emissions.
• The industry has a target to reduce emissions by 50% in about 40 years time.

Really, none of these statements and statistics from the industry adds up to a reduction in carbon emissions or a real investigation into the economics of sustainability for the industry’s future. A cursory glance without doing any mathematics suggests that the airline industry will increase its pollution into the environment driven by its growth and has very little chance of effecting the targeted 50% reduction at any time.

Let’s Talk Economics:

Our current economic model is based on growth as its primary driver towards a greater state of stability and prosperity. It is considered blasphemy in political and business circles to suggest that growth does not lead to prosperity. The concept was founded in a time when the planet was less populous and an understanding of resource limitations and consumerism was barely understood. It is now fairly consensual that continual growth has limits and that we are at that point now. Oil for jet fuel will soon become very expensive and replacing it with bio-fuel is not a viable option if we look at the global resource situation as a whole. In order to grow bio-fuel, farmland normally allocated for food production will have to be used, and with a growing population, presumably all wanting to fly somewhere, there will be competition for fertile land. Remember, we’re reducing our fertile arable land at the moment through deforestation, topsoil erosion and desertification. This along with an over use of ground water will mean bio-fuels will be grown at the expense of food.

Growth economics has proved itself time and again not to provide prosperity if we understand this to mean subjective well-being or happiness.

Factors influencing subjective wellbeing

• 47% Partner / Spouse and family relationships
• 24% Health
• 8% A nice place to live
• 7% Money and financial situation
• 6% Religious and spiritual life
• 5% Community and friends
• 2% Work fulfillment
• 1% Other

Growth economics also presents society with unstable global economies leading to regular boom-bust cycles. Our recent financial crisis is an example in point, caused by runaway growth activity, which caused an unsustainable activity bubble.

Whole system economics, or as EF Schumacher called it, “Buddhist Economics” may be the answer. I doubt that anyone is seriously suggesting that we return to an agrarian way of life, but certainly doing much less of the things that destroy our only ecological home may be a good alternative.

The list of statistics presented by the BAA, BA and London Mayors office panelists did not show any reduction in the use of carbon fuels, but within the next 40 years they may be forced to by fuel shortages.

My suggestions to BAA, BA and the London Mayors Office are as follows:

Look at the prosperity of their businesses and that of London as a whole, not in terms of traditional GDP, but as subjective wellbeing and devise their business strategies to suit people rather than growth figures.

• Look at modeling a profitable and sustainable business on being a transport company rather than flying aeroplanes.
• What would a smaller Heathrow be like?
• What would happen if London lost its place as a major world capital but gave its population a better standard of living?

Thousands die in the capital each year due to carbon emissions. Reducing this number should surely become a priority!

• Analyse the diminishing marginal returns (DMR) on flying based on subjective data as well as objective. Fuel and material costs are relevant issues, but so is a change in public perception about flying and airports.
• It was mentioned that the people of Putney, West London don’t trust BAA as they are on the flight path to Heathrow. Is this because the airport isn’t working for them? What does that mean for DMR over 10 years? Notice food stickers that say, “We don’t air freight food”. Are people’s perceptions changing?

My hope is that the panellists actively participate in modeling ‘doing less’ rather than ‘exploiting more’ or they may get a nasty shock as the world changes.

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