How to save the planet without too much pain

The secret to cutting carbon emissions is not so much how the power is generated but how it is used

The Government's new energy white paper reminded me of the present I want to buy myself next birthday. It is an LED torch.

The Government's new energy white paper reminded me of the present I want to buy myself next birthday. It is an LED torch.

The paper, which sought to promote the shift to cleaner energy, was met by the usual growls of dissent. The headlines told the story. "Switch to cleaner energy will lead to higher bills, says Hewitt," read one. Or "Blair stepped in to block plans for new nuclear power stations". And, more predictably, "Critics accuse ministers of fudging key issues".

So we are going to have more giant windmills instead of nuclear plants, and we are all going to have to pay more for electricity. But wait a minute, what we as a country do or don't do about our energy policy is not really going to have a huge impact on the planet. Britain accounts for 4 per cent of global GDP, which is useful, but the tail will not wag the dog.

There are the most profound reasons for seeking a world that relies less on fossil fuels, that does not risk the uncertainties of global climate change and – frankly – is less dependent on the Middle East for its energy supplies.

But what really determines whether the world has a more sustainable approach to energy use is not what some here today, gone tomorrow, British cabinet ministers write in a white paper. It is what technology can achieve over the next generation globally.

And so to my LED torch. The many readers (or writers) of The Independent who ride bicycles will of course need no introduction to the light emitting diode lamp. I have a colleague's sitting on my desk now. It is called a Cat Eye, and very beautiful object is too: silver, tiny, bright, and with batteries that last forever. The environmentally correct cycling community is the pioneer user of a technology that will, over the next generation, revolutionise the way we light our homes, factories, offices, hotels, streets – indeed our whole lives. When it comes, it will be as big a change as the switch from gas lighting to electric a century ago.

LEDs use a tiny fraction of the power of regular light bulbs and far less even than the current generation of low-energy fittings. It will become virtually free to light a home and there will be such huge savings for office blocks that once the technology is available, no new commercial building will use anything else. To be sure, the technology is not quite there yet. It has taken a long time to get a proper, comfortable white. Red was easy; blue came next. But even now, the white that is available is not really suitable to light a home.

Moreover, all the fittings have to be redesigned, because LED light is qualitatively different from the conventional sort: much more diffuse, more of a glow. It also costs much more, for now. So for a while it will still only be early-adopters who use it. But at some stage in the next 15 or 20 years there will be a tipping point, just like the switch from gas to electricity, and quite suddenly we will move over. And the world bill for artificial lighting will drop by a factor of 10.

The reason for dwelling on this is that it is one example, probably the best around now, of the potential of technology to bring a step-change in energy conservation. The difficulty is that lighting is not a particularly large user of energy: transport, eating and, in some parts of the world, air-conditioning are all much more important. But it does show the potential of a technology to change lives. Somewhere out there in some laboratory (or maybe garage) will be other technologies that have the potential to save energy for other functions in equally radical ways.

Incremental improvements will continue to cut the energy-intensity in uses such as transport. The most fashionable car to have in California now is not some gigantic four-wheel-drive pick-up but the modest Toyota Prius. It and the new Honda Civic IMA (Integrated Motor Assist), are hybrids, with a petrol engine and an electric one. The petrol engine (and the brakes) are used to charge the battery and the electric motor takes over in nose-to-tail traffic. The result is a low-emission car that is much more efficient than a petrol-only one of similar size.

Incremental improvements in aircraft technology are similarly cutting their energy use. The super-jumbo Airbus will be the first plane to have the same fuel consumption per seat mile as a family car, while the next generation of Boeings will be about 20 per cent more efficient than the present line-up. (Trains seem to be the one area where fuel consumption is rising rather than falling: the new ones in the Southern region have had to be mothballed because the power supply cannot cope with their needs.)

The central point here is that the secret to cutting carbon emissions is not so much how the power is generated but how it is used. You have to work on both sides of course, but clever technology applied to global conservation is much more likely to have a global impact than one country deciding to build some more windmills.

So how is that to be done? The market has a huge role to play, for the market will signal to consumers and producers alike, where the most promising opportunities for conservation lie. At an individual level most of us are a bit sloppy about this. I know that if I fixed the draught from the front window and fitted thermostats to the radiators the house would be warmer and the fuel bill lower. But it is one more thing to have to do.

At a commercial level the market ought to push companies into wiser policies. Investing in conservation can bring enormous financial returns: paybacks in two years or less. The fall in interest rates also helps because it makes more sense to borrow money to finance energy-saving investment.

Governments, at the very least, can stop the market giving perverse signals. Here in Britain it was mad to cut tax on energy use in the home. US fuel pricing is of course ridiculous. In some less developed countries, governments have increased taxes on paraffin with the effect that poor people switched back to firewood for cooking, thereby encouraging deforestation.

Getting market signals right is a necessary but insufficient condition for energy conservation. There are areas where regulation can give a push. Where regulation runs counter to the market, expect a disaster such as happened in the US with car fuel consumption. Regulation forced the companies to produce gutless cars, so the great American driving public switched from cars to trucks and four-wheel-drives. But – as in California now – regulation can give a nudge to people considering switching to the Toyota and Honda hybrids. It will be intriguing to see the effects of Ken Livingstone's congestion charge exemptions for environmentally friendly vehicles: Will significant numbers of people switch to liquid petroleum gas?

But the bigger point here is that technology really can help. Once the world becomes frightened about the amount of energy it is using it will find all sorts of ways of using it more wisely. Somewhere out there will be the technology that replaces our present oil-based economy, just as oil replaced coal.

We don't yet know what that technology will be – sadly, history is littered with examples of apparently promising technologies (such as nuclear) that fail to realise that promise. Meanwhile we should not despair, and we should embrace the technologies that are available to help us do a bit less damage to the planet while we wait.