Oil-guzzling China has a positive spin-off: Green tech

Richard Woods

At the Lotus engineering works in Norfolk, eastern England researchers are working on an idea that seems almost too good to be true: a car that runs on CO2

The very gas that comes out of exhausts and poses the threat of climate change could, they believe, be extracted from the atmosphere and used as a source of synthetic fuel. Hey presto: a carbon-neutral car, planet saved.

From theory to practice is a bumpy road, of course, and Mike Kimberley, chief executive of Group Lotus, readily admits that some alternative fuels “could be more easily implemented than others”. He is optimistic, however, and determined to make Lotus a “world leader in green transport engineering”. All sorts of initiatives for clean, green and renewable energy are being supercharged by oil prices that hit a new record last week of $146 a barrel — and may well go higher.

What is bad news for businesses and consumers, however, is good for investors in green energy. Vast sums of money are pouring into technologies that until relatively recently were the preserve of niche businesses and environmental campaigners. This year should see a record £73billion or more invested in “clean technology” despite the credit crunch, according to a report published last week by the consultants New Energy Finance for the United Nations.

“The green energy gold rush is attracting legions of modern-day prospectors in all parts of the globe,” said Achim Steiner, head of the UN environment programme. Dotcom entrepreneurs, Wall Street financiers and venture capitalists of every hue are piling in.

While the demand for oil in most western countries has flatlined or even declined over the past 12 months as economic conditions have worsened, in China it is powering away. This demand, and for other commodities, is driving up prices — but also spurring investment in technologies that might unlock a new era of clean, affordable energy.

It prompts several questions: are consumers finally beginning to change their habits? Will alternative energy sources become economically competitive? And could China’s thirst for oil in fact save the planet?

That high oil prices are changing consumers’ habits is clear. In the US the latest figures show that American motorists drove 1.4billion fewer miles in April than in the same month last year. It was the sixth consecutive monthly drop. Bus and train use has jumped 10-15%. In Britain similar concern is evident. Petrol sales are down and an AA survey shows that 48% of drivers are considering cutting out short journeys by car and 62% would consider buying a more fuelefficient model. SUNDAY TIMES