As the vast government stimulus packages roll out, there is growing interest in how "green" they are. How much do they prop up old, geriatric industries, or spur investment in new technologies, business models and economic clusters? And how might we plan for—and achieve—a "green" recovery?
Banking giant HSBC has concluded that most countries are still in the planning phase, with only a small fraction of the money promised released to invest in wind farms and other green ventures. Of nearly £300bn HSBC has identified in green fiscal programmes in the 20 countries it tracks, only three per cent had been spent by the end of the first half of 2009. As HSBC's report noted, "considerable time can elapse between the announcement of high-level spending programmes and actual disbursement".
The US has spent just $355m, out of a total of $64bn committed to energy efficiency, renewable power and other green investments. Whatever environmental and clean-technology entrepreneurs may hope, many of the programmes that have been announced in the US, China and other countries are not likely to be implemented until 2010 and 2011.
But while they may be slow on implementation, some governments have been promising more green funding. Since its last report in May, HSBC reports that the total amount of money spent on energy efficiency and other programmes has increased from $478bn to $512bn by the end of July.
Green spending accounts for about 16 per cent of the $3.1trn in total global fiscal spending governments have committed. Some see this as too little, too late. But optimists stress the potential impact of the "multiplier effect". HSBC itself calculates that around $546bn in private spending will be delivered on top of the known green spending plans from governments, suggesting a total global stimulus of more than $1trn. Two questions, though: In terms of financial sustainability, how will we pay that huge sum back; and, in ecological sustainability terms, will it be enough?
John Elkington is co-founder of SustainAbility (www.sustainability.com) and Volans (www.volans.com).
