HEC4Climate: "We are heading towards a smart green digital economy" Jeremy Rifkin

20 November 2015

On October 1, Jeremy Rifkin, a leading economic and social theorist, and a political advisor was part of “The 2°C Challenge” event organized at HEC Paris. In an enthralling keynote speech, he shared with the HEC community his insights on the new digital green economy that could stem from the “Third Industrial Revolution.”

Jeremy Rifkin - HEC4Climate 2015

For more than an hour, Jeremy Rifkin lived up to his reputation as an extraordinary speaker able to captivate and motivate an audience with his inspiring ideas, even as he introduced his talk with an alarming observation: “GDP growth is slowing down in every country of the world, unemployment remains high, productivity has been waning for twenty years… and this dire economic reality is now compounded by the rapid acceleration of climate change brought about by increasing emissions of industrially induced global warming gases.” Rifkin then recalled basic climate phenomena: “The Earth's temperature could rise more than 3.5° and possibly 4.5°C or more by 2100 – temperatures not seen on our planet for millions of years. Remember, human beings have only inhabited Earth for 175,000 years!” The consequences of this rise in temperature are already being felt in various eco-systems: they include bitter winter snows, more dramatic spring storms and floods, more prolonged droughts, and a rise in sea levels. “We could witness the extinction of half of Earth’s species by the end of the current century–and on average it could take upward of 10 million years to recover the lost biodiversity,” he warns.

Welcome to the Third Industrial Revolution

So, is humanity doomed to disappear? No! Jeremy Rifkin has hopes that the new economic paradigm currently emerging, the so-called “Third Industrial Revolution,” can dramatically transform the way human beings organize economic life on the planet and thus stop the process of climate change. “Industrial revolutions are based on three elements: new communication technologies, new sources of energy, and new means of transportation,” he explains. “In the 19th century, the first Industrial Revolution was founded on steam-powered printing, the telegraph, abundant coal, and locomotives on national rail systems. In the 20th century, centralized electricity, the telephone, radio and television, cheap oil, and international combustion vehicles on national road systems converged to create an infrastructure for the second Industrial Revolution.” According to Rifkin, we are now heading towards a smart green digital economy, based on digitalized communication, digital renewable energy, and digitalized automated transportation and logistics that will create a super Internet of Things (IoT) and lay the groundwork for the third Industrial Revolution. “14 billion sensors are already attached to resource flows, warehouses, road systems, factory production lines, the electricity transmission grid, offices, homes, stores, and vehicles, continually monitoring their status and performance. By 2030, there should be more than 100 trillion sensors connecting the human and natural environment in a globally distributed intelligent network. For the first time in history, the entire human race can collaborate directly with one another, democratizing economic life.”

The Rise of the Sharing Economy

The Internet of Things is a huge opportunity. “Using smartphones, millions of people, especially the young generation, are already transferring bits and pieces of their economic life to the sharing economy. They use Airbnb and Couchsurfing to share their homes with millions of travellers, and Blablacar ridesharing services to make short or long distance journeys. They produce and share music on collaborative platforms, and use MOOCs instead of attending physical courses in classrooms. In the sharing economy, social capital is as vital as financial capital, access is as important as ownership, sustainability supersedes consumerism, cooperation is as crucial as competition and 'exchange value' in the capitalist marketplace is increasingly supplemented by 'shareable value' in an extended network. 62% of Gen Xers and Millenials are attracted to the notion of sharing goods, services, and experiences in collaborative commons.” Jeremy Rifkin is well aware of the potential dangers of this revolution: “It raises privacy and social issues.” But he is strongly convinced that the opportunities it opens are worth the challenges.

Handling Climate Issues

The unleashing of extreme productivity wrought by the digitalization of communication, energy, and transportation is leading to a new understanding of ecological sustainability. “Millions of people are already producing their energy at zero marginal cost in Germany, using solar panels and windmills. A decade ago, four giant vertically integrated companies – E.ON, RWE, EnBW and Vattenfall – produced most of the electricity in that country. In recent years, farmers, city dwellers and small and medium businesses established electricity cooperatives that installed solar, wind, and other renewable energy infrastructures on site. The “big four” are now producing less than 7% of new green electricity in Germany. By 2020, 35% of the electricity powering the country will be generated by renewable energy.” If the European Union is laying the groundwork for a smarter and greener economy, developing nations are also leapfrogging into the third Industrial Revolution: “The lack of infrastructure from the second Industrial Revolution is both a liability and a potential asset for them. Families across Africa are installing solar panels, and other green micro-generation technologies are on the rise.” China is already spearheading an economic paradigm shift in Asia: “After my visit in September 2013, the Chinese government announced an $82 billion, four-year initial commitment to establish a digital energy internet across the country, so that millions of Chinese people and thousands of Chinese businesses can produce their own solar and wind-generated green electricity, and share surpluses with each other.”

Praise for Youth

To conclude his speech, Jeremy Rifkin spoke about his trust in young people: “I am hopeful that they can achieve this transition. They have different ideas than we do about freedom, power, and community. They share on complex networks, give their talent open source to the community, and are well aware of their ecological footprint. They know that everything they do intimately affects their fellow human beings, the ecosystem, and our planet. In the United States we say 'one nation indivisible.' In fact the motto should be 'one biosphere indivisible' and youth today understand that. They will spread the revolution and make sure sustainability is not greenwashing; they will change businesses, and they will change the world.”

More about....

Jeremy Rifkin
Jeremy Rifkin is a leading economic and social theorist, and a political advisor. He is a senior lecturer at the Wharton School’s Executive Education Program at the University of Pennsylvania, and studies the impact of scientific and technological changes on the economy, the workforce, society, and the environment. His vision of a sustainable, post-carbon economic era based on a third Industrial Revolution has inspired a growing number of world leaders and decision makers in the past decade, including German Chancellor Angela Merkel and Chinese head of government Li Keqiang. An advisor to the European Union on issues related to economy, climate change, energy security, and sustainable development, he is the bestselling author of twenty books, including The Zero Marginal Cost Society (2014) and The Third Industrial Revolution (2011).

The 2°C Challenge: Success for HEC Paris
The conference entitled “The 2°C Challenge, Climate is our Business,” held on October 1 at HEC Paris, was a unique opportunity for the HEC community to come together to discuss the vital issue of climate change. From noon until 9:00 PM, the campus buzzed with a vibrant forum for entrepreneurs, a series of riveting workshops, and two major conferences. Students, alumni, scientists, and economic and business leaders attended, all wanting to find tangible solutions to tomorrow's biggest environmental challenge.

Climate is our business logo 2015

This article was originally published by HEC - Hommes & Commerce Magazine

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