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Energy-saving incentives for Iran

By Mandeep K Bhandal, on 21 February 2013

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ISRS Senior Research Fellow, Chris Cook comments in the FT on 19 February 2013 regarding a new policy of constructive energy co-operation with Iran.

A full transcript can be found here:

Sir, Further to your editorial “Iran’s intransigence” (February 15): I have visited Iran several times in the last couple of years in relation to energy policy; have met many influential Iranians up to and including the oil minister; and have gained some insights into the view of Iranian decision makers.

When even Iran hawks such as John Hannah and Richard Perle agree, as they did recently at a conference in London, that spare parts for superannuated Boeings are not exactly an appetising incentive, then it is clearly the case that attention is overdue to the carrot, rather than the stick.

Perhaps energy co-operation may be such a carrot. Even through the darkest days of the cold war, the USSR reliably supplied natural gas to Europe, which reliably paid for it: ironically, it took privatisation and the advent of oligarchs and opaque middlemen to cause interruptions in supply. Likewise, even during the radical Khomeini years from 1979 to 1993, Iran reliably supplied crude oil to Israel via intermediaries.

I believe that the US in particular (and Israel) should offer to flood Iran with the technology, knowledge, equipment and skills necessary for investment on a massive scale in renewable energy and above all in the low-hanging fruit of carbon fuel and other energy savings. The supply of such equipment and technology will not only benefit the environment but will be highly profitable for suppliers whose EU, Chinese and Japanese competitors court Iran despite sanctions. But more importantly, such technologies will – as in the UK – compete with nuclear energy to the extent that Iran will rapidly come to the conclusion that further nuclear development is uneconomic by any standard.

So my advice to US and Israeli policy makers is to focus on a new policy of constructive energy co-operation – which transcends religion and ideology – with Iran. Based upon my experience there I have no doubt that energy co-operation through technology transfer and investment would be received warmly by a country with probably one of the greatest pools of untapped human and intellectual resources on the planet.

 

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