China’s New Green Plan: the Local Angle

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To get a
better view of what was happening at the local level in terms of China’s new
national low carbon and ecological planning
, I recently traveled to Jiaxing, Zhejiang Province. Jiaxing (above–click on photos for full size) is a
“small town” of about four million that is now only 21 minutes (80 kilometers)
from metro Shanghai on a new high-speed electric train line, the fastest in the
world
–the line, which will eventually extend to Beijing, recently set a test
record of 259 miles per hour
.

I was traveling with other strategic advisers from the Institute for Strategic Resilience, Irv Beiman and Daniel Zhu. Jiaxing is Zhu’s hometown, and he helped arrange our two-day visit.

Jiaxing sees itself as a “Garden
City” (with more than 40 percent forest cover), and truly it felt
that way thanks to extensive landscaping and forests planted on the site of
former rice fields. Jiaxing is also billing itself as the “Oriental Silicon
Valley,” which embodies China’s plans to transform its economy, particularly in
eastern coastal areas such as the Yangtze Delta, from manufacturing to service
industries, such as IT and green technologies, to supplant its product-export-dominated
industrial base.

Jiaxing is
the home of the first official Communist Party of China meeting. It occurred in
1921, with Mao Zedong and a few others from Shanghai on a boat playing Mahjong
for cover out in the middle of the city’s South Lake.

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South Lake and a replica
of the famed boat (above) have long been the site of pilgrimages from Chinese
citizens, which may account for the town’s relative superior level of historic
and cultural preservation.

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South Lake still hosts traditional fisherpeople who
rhythmically clap boards on the gunwales of their sampans in order to scare fish
into awaiting nets.

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Jiaxing has been engaged in careful restoration and reuse of its city center’s large 500+ year-old historic district (above). Starting with the canal that encircles its ancient district, the city is attempting to restore the ecology of its deltaic
landscape and waterways through applied research of the Yangtze Delta Research Center of Tsinghua
University, which is also located in the city. Jiaxing was a north-south node on the great Beijing-Hangzhou Canal, parts of which date back to 2,500 years, the longest engineered water body worldwide.

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In Jiaxing
City Hall, a five-story building passively daylighted with great artistry (above) and
surrounded by acres of naturally looking forest planted eight years ago, we met
with officials. City leadership included the mayor and representatives from the
National Development Reform Commission, or NDRC, to which the mayor reports. They explained
how the city wants to improve its environmental management and clean industry attraction.

They read us
the new goals being dictated from the draft 12th Five Year Plan for 2011-2015,
including how they will need to reduce carbon emissions and decrease fossil
fuel use, SO2, CO2 (and other more toxic emissions), water pollutants (measured primarily through chemical oxygen demand levels, or COD) and acid
rain, while maintaining or restoring forests. While the United States regulates about 1,200 chemicals or pollutants, China currently only regulates about 200.

Water quality is a key national initiative,
especially in the Yangtze River and Pearl River deltas. Poor water quality–at the Fourth World Forum on China Studies that I also presented at, Zhu spoke of water quality in some regional lakes as being 2,000
times over national standards for heavy metals–has been impacting not only the
industry and residents, but also is degrading the estuarine fisheries of the
East and South China Sea. The NDRC party official told us that the city’s water quality
in its canals is a “three or four” on a seven-point scale, with one being the
best. The water in the canals did not stink, but it was an opaque dark brown
indicating possible overload of fertilizers and other organic material.

We toured a
new Science and Industry research center, which had a display on green
chemistry. We also visited a state-of-the-art “living machine” type wetland of
dozens of acres that the city designed to biologically clean its drinking water
while providing open space for recreation. Water fowl and numerous plants
species were abundant in the wetland.

Near the ancient city center, an intact
island city of 500 years old, university-sponsored researchers were using an
experimental technology to oxygenate the organic material-laden canals (from
rice and other fertilizers) that flowed around town from the nearby Yangzte
River.

Officials
told us that Jiaxing is the first city in China as part of national pilot
project to reduce SO2 emissions using a market-based emissions reduction
program. At the city’s pollution exchange center, an official explained how the
price of $20,000 Renminbi ($3,000 US) was assessed per ton on SO2 for the next 20
years for existing industries. Industries or operations that produce too much
air pollution are being discouraged from locating in the city by much greater emissions
fees, three or four times more, that would apply to them.

Highly polluting and energy-intensive plants are being shut down around Jiaxing and throughout
the nation, in China’s east coast in particular. And true to the goals of the
Twelfth Five Year Plan, Jiaxing, instead of pursuing more primary or secondary
manufacturing, the “Oriental Silicon Valley” (there has to be a better way to
translate that nickname!) is vying for software, telecommunications and service
industries.

Though Jiaxing is making strides as a center of research and applied research for environmental management and low-carbon approaches and technologies, its new green evolution is not without hurdles.

Like many local and regional governments, the city and the Zhejiang Province, have been struggling to meet the energy efficiency mandates of the national 11th Five Year Plan that officially that ends December 31. In order to achieve the goals of the 11th Five Year Plan for energy-use reduction, rolling blackouts were occurring throughout the area, forcing industry to use dirtier diesel generators for electricity, which contributed to local air pollution as well as shortages of diesel gasoline used by trucks.

As Jiaxing illustrates, no one expects China’s new greener path to be easy or without conflicts. The implications for this new direction, however, augers well on a number of fronts. China’s new National 12th Five Year Plan should be a boon for greater technological innovation, greener economic growth and greater attention to global (climate change) and national environmental degradation, as well as international cooperation.

Warren Karlenzig is president of Common Current. He is a fellow at the
Post-Carbon Institute, strategic adviser to the Institute for Strategic Resilience and co-author of
a forthcoming United Nations manual on global sustainable city planning and management. 
 




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The Exurban Meltdown: We Are Goldman Sachs

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Did runaway exurban sprawl–particularly in hypergrowth Sunbelt communities–help create the conditions for gaming in the financial industry? In other words, Goldman Sachs and other financial firms gave us what we wanted as a nation and then bet against us when they saw too many suckers entering the game. 

These issues loom large as the Securities and Exchange Commission (SEC) accused Goldman Sachs of fraud last week tied to collateralized mortgage debt
obligations that contributed to the worst financial crisis since the
Great Depression.

Goldman made large profits on the housing boom through 2006
, then essentially bet on the market to fail so it could profit on the national housing bust, which raged in 2007-2009.

The first domino of that financial panic was the 2006 spike of foreclosures in the most sprawled, car-dependent communities such as Phoenix, Las Vegas, San Bernardino-Riverside, California and Tampa, Florida.

Goldman started betting against the mortgage market in 2007, which thereafter began its well-publicized death spiral, particularly in newly developed suburbs located far from city centers of public transportation and jobs. 

The Post Carbon Institute will soon be publishing my report examining the sustainability impacts of such “easy credit terms” and subsequent speculation. The study also provides planning solutions for greater metro area resilience, which The Natural Resources Defense Council recently highlighted: “NRDC has chosen sustainable communities as a strategic objective for the next five years. Karlenzig’s advice seems right on target as we further refine that agenda.” 

Here’s an exerpt from, “The Death of Sprawl: Designing urban resilience for the 21st century climate and resource crises.” (The study profiles a fast-growing exurban city in Southern California, Victorville. Victorville, now wracked by foreclosures, grew in population from 60,000 in 2000 to 107,000 by 2007, largely due to zero downpayment home loans for newly built subdivision homes):

Relatively cheap real estate, flat land, and single-purpose zoning meant big profits for real estate developers and construction companies. Builders could easily and quickly build vast residential neighborhoods without thinking about where residents would work or how they would get there. Relaxed federal regulations on the financial industry meant first-time homebuyers could “own” their home without a downpayment, and sit back while home prices climbed. 

And for a few years, climb they did. When home prices were rising in the region in the early 2000s, Victorville seemed like a sound investment. But by 2006 the price of gasoline began its steady ascent above $2 a gallon and a bubble burst in Victorville and other exurban market housing prices creating the first wave of foreclosures that helped set off a national economic crisis.


A complex and devastating chain of events began with people losing confidence in the seemingly ever-upward growth of exurban economies. Across the country, home foreclosures began to appear overnight in exurban hyper-growth markets, most notably inland Central and Southern California, Las Vegas, Phoenix and much of Florida.


The nationwide exurban decline that ensued may prove to be the last gasp of the Sunbelt's decades-long development frenzy. We will be absorbing or trying to erase the unwanted surplus of this end-of the-twentieth century building spree for years, if not decades.
Whether Goldman was guilty or not, we are all paying a high price for unfettered housing growth and financial speculation. The impacts of the financial and housing sector "gone wild" includes a much greater carbon footprint, wasted resources, significant traffic and air quality impacts, not to mention now-blighted communities. We can learn much from such lessons, but who will take responsibility so that it won't happen again? Local, regional and state government that allowed the crazy-quilt growth surely are to share the blame with national financial oversight agencies. But to a certain degree, this chapter in our nation's history was a reflection of ourselves. We sacrificed our domestic jobs so people could instead live off their housing deal or "property flipping" income and home equity loans. We built over our best farmland, forests and watersheds, greedy for tax revenues from endless housing subdivisions and strip malls. And we sacrificed our historic communities and walkable neighborhoods for mass-produced completely car-dependent chimeras. Make no mistake about it, we are Goldman Sachs. Warren Karlenzig is president of Common Current, an internationally active urban sustainability strategy consultancy. He is author of How Green is Your City? The SustainLane US City Rankings and a Fellow at the Post Carbon Institute.  



 

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EPA to Regulate Greenhouse Gases in Big Boost for Copenhagen

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EPA Adminstrator Lisa Jackson and President Obama

The US Environmental Protection Agency (EPA) Administrator Lisa Jackson announced today that EPA will regulate greenhouse gases as a dangerous pollutant, which comes as a big boost to perceived US-commitment to the kick-off of Copenhagen COP 15 climate talks.

Because the Senate was not able to pass the greenhouse gas cap-and-trade regulations in time for Copenhagen, the Obama Administration has turned to Plan B to regulate greenhouse gas emissions–having the EPA regulate greenhouse gases from major industrial sources and from tailpipes.

Greenhouse gas emission regulations are expected to be finalized by the EPA in March and would begin to go into effect by May.

Cities and local government agencies will need to closely monitor the new federal EPA development as it will have large impacts on municipal greenhouse gas sources such as power plants, transportation fleets and other large emission sources. Until now, the federal EPA only has provided guidelines and third-party resources to local governments on such issues as greenhouse gas inventories.  

While the Senate still has a few months by which to pass cap and trade before its spring sessions ends in March, the EPA regulatory approach versus Congressional legislation is likely to increase regulatory costs and be “messy,” according to Tim Newell, senior adviser at private equity firm US Renewables.

“Having regulations by EPA (versus Congressionally approved cap and trade) raises the costs of high-carbon fuels and power production,” said Newell.

Other non-partisan sources such as the Congressional Quarterly claim that EPA regulation of greenhouse gases under The Clean Air Act will be a “blunt instrument” that will cause court challenges and additional red tape for industry, as well as state and local government.

The move by the EPA might also force the Senate to pass cap-and-trade regulations as a less-onerous form of greenhouse gas compliance.

Most importantly, the EPA’s move today demonstrates that the US “has teeth” to regulate greenhouse gases, which is more likely to tip Copenhagen toward a successful binding agreement including the US and other nations.

Passage of a successful treaty in Copenhagen would then put more even pressure on the Senate to take action, which presents a situation where the nation might have to comply with both Congressional cap-and-trade and EPA Clean Air Act greenhouse gas regulations. 

Warren Karlenzig is president of Common Current, an internationally active urban sustainability strategy consultancy. He is author of How Green is Your City? The SustainLane US City Rankings and a Fellow at the Post Carbon Institute.

 

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Common Current’s Top Ten 2008 Sustainability Stories

Here are the top ten sustainability related stories of 2008 that we have been watching and participating in at Common Current, a global sustainability consultancy. True to sustainability system dynamics, most of these items impact the other items on the list, and they will continue to unfold in 2009 and beyond.


1. Election of Barack Obama


After Barack Obama’s historic November 2008 election, he continued to demonstrate a sophisticated understanding of the risks posed by  global climate change and the nation’s dependency on foreign energy. In addition to making green jobs and clean technologies a major part of a national economic stimulus package and a precondition for many cabinet appointments, Obama’s view of sustainability as an opportunity shows he will take on vexing problems with new solutions.

 

Obama’s statement on “60 Minutes” when asked about his energy priorities with oil going from $147 a barrel to under $60 a barrel was telling: “We go from shock to trance. You know, oil prices go up, gas prices at the pump go up, everybody goes into a flurry of activity. And then the prices go back down and suddenly we act like it’s not important, and we start filling up our SUVs again. And, as a consequence, we never make any progress. It’s part of the addiction, all right. That has to be broken. Now is the time to break it.”

 

Obama’s dipping into the Clinton well to appoint former EPA politcal warhorse Carol Browner as Energy and Climate Czar demonstrates that his new solutions don’t necessarily mean new people will be addressing them.

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Barack Obama with new Energy Secretary Steven Chu, EPA chief Lisa Jackson and “Energy and Climate Czar” Carol Browner (AP photo)

 

One of Obama’s sustainability-related appointments, though, does demonstrate how multi-sector collaboration will reshape the US economy to be more energy efficient and less carbon intensive. Steven Chu as Secretary of Energy is a savvy choice. Chu, a Nobel-prize winning director of Lawrence Berkeley National Laboratory, has piloted economic-development enhancing climate change solutions with the energy industry, the green building sector, venture capital firms and alternative fuel academic researchers. He also supervised the Helios Project, which is trying to bridge the gap between transportation and solar energy technologies.

And to bolster the administration’s science-based approach on policy further, Obama selected Harvard’s John Holdren as Chief Science advisor. Holdren is respected as one of the leading experts on global climate science (he advised Al Gore on An Inconvenient Truth), and is well versed in clean technologies.



2. The 2008 Presidential Campaign

Unlike previous elections where “The Environment” garnered nary a mention, the months leading up to the 2008 election of Barack Obama saw the big-time advent of sustainability topics.

 

Both McCain and Obama supported carbon cap and trading for industry to reduce greenhouse gases. Obama also made a vague campaign pledge of investing $150 billion over 10 years on clean tech and energy efficiency.

 

But the most memorable sustainability campaign moments came in spring when gas prices began to hit their historic high of more than $4 a gallon. McCain’s call for a consumer federal gas tax holiday was met with derision from most including Obama, as it would only make foreign oil dependence worse, not to mention increase carbon emissions. The McCain “gas tax holiday plan,” supported by then-candidate Hillary Clinton, died on the vine during the heat of June.

3. 2008: The Highest Gas and Oil Prices Ever

When oil reached $4-5 a gallon at the pump and more than $145 a barrel in July, a future of energy volatility and potential energy scarcity came into sharper focus. Record numbers of Americans took to public transit, while others reconsidered where and how they could use less gas not only in their cars but in their lives: “Mixed-use” real estate (neighborhoods with shops, jobs and homes) with good public transit were suddenly hot tickets. Meanwhile, people started using web tools such as “WalkScore to judge whether potential jobs and homes were easy walking distances to shopping, schools and entertainment. Offices or homes that were too car-dependent were suddenly out of fashion.

 

4. 2009: The Lowest (Relative) Gas and Oil Prices Ever?

The world economic meltdown of 2008-2009 demonstrates how closely energy supply, particularly oil, greases the gears of commerce–and vice versa. As the stock market and demand plunged, so did oil prices. Oil reached a year low of under $40 a barrel in late December, when OPEC’s announcement of production cuts did little to stop the slide.

The real hand on the throttle of pricing is the economy, as global demand has slowed considerably. When the economy does pick up, scarce supply (or speculation about scarce supply) might again force steep price hikes, as private oil companies and nationally owned oil producers are canceling development plans for refineries and exploration because of the large drop in prices. In the meantime, alternative fuel development will be hurt as this emerging market, when unsubsidized, requires a minimum oil price of about $50 a barrel to be competitive with crude.

 

5. Arctic Ice Cap Melting Accelerates Wildly

The surprising loss noted by scientists in 2008 of the Arctic ice cap and inland Arctic ice is major cause of on-going global environmental, economic and geo-political concern, with the area now up to ten degrees Fahrenheit warmer than it was in the 1980s. The newly open Arctic waters will cause even warmer temperatures in the region and beyond, as water absorbs far more heat from the sun than does ice.

 

Besides releasing the trapped methane (worse than carbon dioxide in terns of greenhouse impacts) from permafrost, melting inland ice is raising global sea levels. Two trillion tons of arctic ice has melted since 2003, according to NASA. Sea ice in the arctic region broke up earlier in the season, opening up a potential permanent shipping lane around the former polar ice cap and precipitating an international scramble for the region’s energy resources.

 

6. Super Storms and Global Climate Change Adaptation

The strength, duration and location of major storms in 2008 led many to speculate how much global climate change is contributing to deadly and economically devastating events.

 

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Burma’s southern coast before and after (May 2008) Typhoon Nargis. A present day image providing a snapshot of what many climate change forecasts project for some coastal areas.


On the Gulf Coast, Hurricane Ike came ashore as a dangerously large hurricane (though only officially Category 2 strength) near the Houston-Galveston area, killing at least 17, and destroying or damaging thousands of homes as well as knocking out refineries, oil platforms and major supply pipelines. Southeastern US cities such as Atlanta and Charlotte, NC were hit with severe price hikes and gas shortages for the month that followed Ike, demonstrating the vulnerability of the nation’s economy to storms that may be intensified by climate change.

 

7. China’s Industry Impact on Olympics, Consumer Products, Global Food and Air

(Thanks to Jared Press on this)

After taking up a “Blue Skies” campaign and relocating or ceasing industrial production and much of Beijing’s downtown traffic, China barely cleared its polluted skies in time for the opening Summer Olympic ceremonies. Air, water and toxic waste pollution have been increasing steadily in the nation as a result of consumer demand in the United States for inexpensive products. Only one tenth of the nation’s sewage is treated, according to a University of Hong Kong scientist. This “ask no questions” mentality has created runaway cancer rates, turned rivers bright green or black, and smudged the atmosphere so much that at times in Beijing airplanes have not been allowed to land.

 

China also by 2008 became the world’s largest emitter of greenhouse gases. It spews a dangerous blend of particulates, sulfur, mercury and other deadly compounds, as new coal plants are fired up at a rate of two per week. Air pollution on the West Coast of United States and Canada has been recently shown to contain as much as one-third of its air pollutants directly from China.

 

Then there is product contamination from China, which began with lead-tainted toys and jewelry, and spread to exported poisonous toothpaste by 2007. In 2008 the industrial and agricultural by-product melamine, first detected in animal feed for chickens, cattle, and fish has now gone up the food chain into eggs and milk. The tainted baby formula has caused kidney failure and illness in 294,000 Chinese infants and six deaths. Tainted chocolate, chickens and hogs have been found in the US, though the meat was not recalled, so it’s likely that many Americans have been unknowingly exposed to China’s dangerous practices not only in the air that they breathe, but in the food they eat.

 

As for the ballyhooed “Eco-City” of Dongtan that China was said to be developing with Arup Engineering, groundbreaking has not occurred and the permit for development has lapsed.

 

 

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8. Foreclosure Crisis: Recipe for Smart Growth?

 

The foreclosure crisis that started in 2007 when gas prices began to skyrocket and that magnified in 2008, had its beginnings in the areas of the United States that largely lack public transit, walkability and mixed real estate uses. Meanwhile as gas prices rose to record levels, metro areas that had housing and jobs close to good transit and walkable amenities saw their value hold steady. Any plan for preventing future housing sector meltdowns needs to include an analysis of how gas and transportation prices pushed many over the financial edge, despite the plentiful supply of distant housing from job markets that seemed (or seems) affordable with low gas prices.

One smart move in policy in 2008 was California’s Senate Bill 375, the nation’s first law designed to limit sprawl and provide communities and developers incentives to build transit-oriented “infill.”

 

9. US Auto Fleet to go Electric? 

With the survival of the current US auto industry in doubt, whatever rises from the ashes will likely be greener and cleaner than anything Detroit ever thought possible before the 2008 downturn. Leading the “charge” for an electric US fleet is none other than Ford Motor Co. Chairman William Ford III, grandson of Ford founder Henry Ford. Bill Ford met privately with Obama during the campaign and with Obama and his advisors after the election: Ford is reportedly advocating for a mostly consumer electric fleet as a way of restructuring the industry to be competitive with imports while reducing climate change emissions.

 

10. Green Jobs

Through the leadership of Van Jones, president of Green For All, the reality of “Green Collar Jobs” came roaring into the United States during 2008, culminating in the “Green Jobs Act” which could be included in Congress’s 2009 economic stimulus package. The act aims to provide 25,000 jobs in solar panel installation, home and business energy retrofitting and other high-paying jobs for Americans, launching new training centers and education programs in high unemployment areas with disappearing manufacturing jobs. The US Conference of Mayors estimates growth of 4.2 million new “green collar” jobs in the nation over the next 30 years. Welcome news after a sobering year.

 

 

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San Francisco Considers Nation’s First Congestion Pricing

After New York City failed to pass a congestion pricing scheme last year, San Francisco is considering tomorrow a way to charge incoming traffic a fee to reduce congestion and address climate change

San Francisco was ranked the fourth most-congested US city in 2008 by the Texas Transportation Institute, after #1 Washington DC. Besides the city’s concern with reducing downtown traffic congestion by trying to get more commuters into the city on public transit, congestion pricing can reduce local air pollution and greenhouse gas emissions.

Other cities that have successfully implemented congestion pricing include London, Stockholm, and Singapore.  Since London’s program went into effect in 2005, downtown congestion has decreased 26% while local CO2 air pollution has decreased 16%.

It’s a tough time for any US city to be considering such a measure (London visitors pay a flat eight British Pounds, or about $13, when they enter the city), but the price of congestion alone can have signficant negative impacts on local economies: estimates for NYC’s congestion annual economic impacts on lost time, fuel and revenue were $13 billion.  

On top of congestion, when one considers public health costs from air pollution and compliance risks to upcoming greenhouse gas regulations, congestion pricing seems like a much better deal than business as usual. 

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Tour of the “Souths”: Korea and Carolina Sustainability Quests

My lack of posting here is the result of travels the past few weeks.

First, I went to South Korea, where the Asian Institute for Energy, Environment and Sustainability invited me to speak at its opening conference, “New Vision and Strategies of Research Institutes for Sustainable Development.”

Just yesterday I returned from Charleston, South Carolina, where I spoke as part of series of sustainability talks put together by Eve Blossom, founder of Lulan Artisans in Charleston. Eve, a diplomat and networker par excellence, guided me to meetings with longtime (32 years!!) Mayor Joe Riley, the Charleston Green Commitee, the Executive Directors of the South Carolina Coastal Conservation League and Sustainable Charleston, and others.

 

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The South Korean event, held at Seoul National University was put together by Professor Ki-Ho Kim, of Seoul National’s Graduate School of Environmental Studies. The Asian Institute for Energy, Environment and Sustainability (AIEES) is launching a cross-discipline research and applied research body that will draw upon urban design, engineering, forestry, arhcitecture, environmental studies and materials sciences.

The approach of AIEES is to to collaborate with other universities (the Yale School of Forestry and Seoul National inked an agreement while I was there), business (we had dinner with the CEO of Samsung), government (South Korea’s Environmental Minister attended, as did the planning director for Boston, Kairos Shen) and NGOs (a Chinese NGO was represented by a Peking University professor). 

In Charleston, that city has been kicking around sustainability in multi-stakeholder committees for the past year. My presentation showed how cities can be benchmarked according to sustainability indicators, which can then help prioritize where to begin taking action.

I recommended transit-oriented smart growth and reduced dependence on coal power as the two focal points for sustainability planning, and gave a few best practices and management approaches as to how this might be accomplished.

In any case, Charlestonians were in fine form–curious, intelligent, practical and enjoyable to visit with. I look forward to heading back there, either as a sustainability facilitator or as a tourist. The ”City of Manners” is a fine showcase of antebellum architecture, all accessible over bluestone-paved sidewalks in a gorgeous bayside setting.  

 

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