The new El Dorado?

Article published on Nov. 18, 2009
Article published on Nov. 18, 2009
The name of El Dorado came to be used metaphorically of any place where wealth could be rapidly acquired - although another metaphor used to represent El Dorado as an ultimate prize or "Holy Grail" that one might spend one's life seeking… When it comes to climate change, both metaphors can be applied to California.
Back to the 70’s, the 1973 energy crisis could be seen as the starting point of the ‘Green Revolution.” The United States faced shortages of electricity, gasoline, and heating oil. Blackouts plagued a few cities and industries, most spectacularly in New York City during July of 1977. The oil crisis was the driving motivation for California to adopt a first package of measures aiming to improve the energy efficiency of the economy. Climate change was not a public issue at this stage and this is only since the end of the 90’s that the link between climate energy efficiency has been made.

A key player is named Jerry Brown, the Democrat Governor who succeeded Reagan as governor (and who could be, ironically, the Democrat candidate running for Governor in 2010). Brown’s policies were encouraged by people like Ed Rosenfeld (the "Father of Energy Efficiency") who helped him to realize the potential of energy efficiency. Brown and his successors have imposed energy efficiency standards for products and buildings which have become a reference for the rest of the world since then. Another big step was to decouple energy utilities’ revenues from the amount of energy they sell. This arrangement creates a fundamental conflict between a utility’s interest in selling more energy and the public interest in conserving it. Energy efficiency and decoupling have helped California to consume electricity far more thriftily than the rest of America.

Lately, California has taken a more proactive approach toward climate change by adopting ambitious objectives in term of CO2 reductions and increasing the share of renewable energy. The latest step in the green revolution has been to attack the problem from all angles (skill, job, funding etc). As outlined in a very interesting article published in The Atlantic a few months ago, the key lesson is that “California has transcended the assumption that sustainability requires scarcity.” (

Another important lesson in the context of today’s debate around the US Climate bill is that regulation can create markets. And whilst the collapse of the state’s real-estate bubble has infringed California’s economy, one of the only sectors giving signs of hopes is the green economy (some will argue that it is mainly because they are heavily subsidies especially with the recent Obama’s stimulus plan).

But the green revolution has not been achieved yet and there are still worries about backlash, especially in today’s context. Some republicans in California are now starting to argue about the zero-sum game between the benefits of sustainable products and the costs involved. For example, Meg Whitman, the former CEO of EBay, former W Bush supporter and one of the republican candidates to be the next governor of California, said she would consider suspending California’s landmark climate-change legislation.

The next front of the battle will most likely be on the growth & job front. To win the battle, California would have to prove the inaccuracy of the perceived disjunction between the optimism of the top-tier boomers and the social and economic realities facing most people. This can be done. According to San Francisco Chronicle, the largest share of jobs in California today - about 49 percent - and the largest share of future green job openings require more than a high school diploma but not necessarily a bachelor's degree. These are high-wage, high-skill jobs like operating engineers, electricians, laborers, plumbers, other construction craftspeople etc. These skills could be translated into the green economy (through large retrofitting programme for buildings for example). But would they? This is only going to happen by a combination of a set of factors such as most likely the price of fossil fuel.

In California like in the rest of the world, it seems that it is business reality, which is likely to become the major driver of the fight against climate change.