The price of postponing the sustainable agenda is paid with the health of the whole society

by Erasmo Carlos Battistella

The transition from an energy matrix based on fossil fuels to one that uses advanced biofuels has a cost analysis component that is totally false or absolutely poorly conducted.
I have no doubt that we are comparing pineapples with bananas, since biofuels are not combustible.

Seems strange? I explain, but first I would like to highlight the following scenario.

I have already dealt with in other articles on this blog how the pandemic crisis – which is still ongoing – has awakened a new awareness in society for the issue of sustainable development. I see this as an opportunity to transform good intentions into concrete actions.

And the economic benefits will be clearly accounted for in the medium and long terms.
These benefits were named in economics. These are “externalities”, a concept that considers the social, economic and environmental effects indirectly caused by a decision on those who did not participate in it.

It is the difference between private costs and social costs or between private profits and social profits. Externalities can be positive or negative for society. Air pollution from a vehicle is an example of negative externality. The costs of this air pollution are not offset by any producer or consumer of the vehicle.

Worldwide, the continuing rise in chronic illnesses and risk factors related to bad habits and exposure to pollution has created the backdrop for the impressive number of deaths during the Covid-19 pandemic.

“Most of these risk factors are preventable and treatable, and combating them will bring enormous social and economic benefits,” said Christopher Murray, leader of the Global Disease Burden Study (GBD).

Opposite directions

When we look at investing in advanced biofuels, externalities make fossil diesel and green diesel absolutely distinct elements with diametrically opposite impacts.

And here I come back to my initial observation: biofuel is not fuel because it allows the reduction of greenhouse gas (GHG) emissions, reduces pollution in cities and reduces the country’s dependence on oil imports.

Whenever we face the need to adopt a new technology or a product that represents an advance for the construction of a cleaner energy matrix, we face arguments of the cost that involves this tradition.

The question must be another: what would be the cost of not adopting biofuels?

Imagine today a world without biofuels, how would we be? Imagine then with the consequences of a world without biofuels in the future. What are we putting at risk?

It is such externalities that raise the question of how much biofuel should cost. We cannot compare, it is neither more expensive nor cheaper than current fuel.

They are different products and, depending on the raw material to be used, the generation of greenhouse gas is negative, with CO2 capture from the atmosphere. We are talking about a powerful instrument, which involves a complete chain to build a sustainable development process that benefits society as a whole.

The sustainability agenda is a solution to the environmental crisis that we are experiencing, instead of representing a cost increase.

In this scenario, the debate is contaminated by business managers who should plan for the long term, but are charged for immediate results. Although we clearly perceive a growing commitment to the climate issue, companies are not yet at the pace necessary for the transition to take place quickly.

The pandemic has strengthened an awareness of change, a special focus on the environmental issue, a focus on the adoption of sustainable energy and pressure from the new generation for a more sustainable world.

If sustainability is on the agenda, strategies and commitments are not directly reflected in organizational practice. We have a more aligned discourse, but decisions that reflect short-term purposes.

What are we willing to invest in this process of setting a sustainable agenda?

If the pressure on costs is greater in times of recession such as the one we are experiencing, it is undeniable to see that there are increasing volumes of resources that go towards sustainable investments.

We found in this pandemic that “externalities” are not abstract items and foreign to the cost spreadsheets. We realize that the impacts of what we do in the short term affect everyone with a price to be paid by the whole society.

It is necessary to extend the look to this broader horizon.

May this new mentality infect the new generation of company managers worldwide and that our children can benefit from this vision of the future that is born now.

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1 comment

Júlio valente Júnior 31 de October de 2020 - 20:17

Esse o desafio a ser perseguido com determinação

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