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Flight to Simplicity
Transition
Chris Cook
23 July 2012
Financing – Clearing Union Peer to Peer trade credit - banks as service
providers not lendersBank capital requirement is only for operating
costsGoods and services change hands by reference to
$, not necessarily in exchange for $ currencyCredit risk shared by sellers and buyers
collectively No 'interest' (money for the use of money)Default costs and operating costs shared
Conventional Banking
Seller
IOU
Buyer
Bank
Value
IOU
Clearing Union - Seller accepts Buyer's IOU
Seller Buyer
IOU
Value
IOU is guaranteed by Clearing Union of Sellers & Buyers collectively
Seller Buyer
IOU
Value
Pool
GuaranteeGuarantee
Seller & Buyer pay guarantee charge into Pool held by Custodian
Seller Buyer
IOU
Value
Pool GuaranteeGuarantee
Fee Fee
1/ Buyer settles credit in money or 'money's worth' eg energy stock
Seller Buyer
Value
Pool GuaranteeGuarantee
Fee Fee
2/System identifies a 'chain' of IOUs A<B<C<D<E<A and 'nets' them out
Seller A Buyer B
PoolGuaranteeGuarantee
Fee Fee
Buyer C
Buyer D
Buyer E
IOU
IOU
IOU IOU
IOU
3/ Buyer defaults: system pays sellers and collects from buyer if possible
Seller A BuyerDefault
Pool
Collects
Pays
Seller B
Default
Pays
Service provider sets guarantee limits, handles defaults & manages system
Seller Buyer
IOU
Value
Pool GuaranteeGuarantee
Fee Fee
ServiceProvider
FeeService
Financing – Capital Partnership Investment to a common purpose in people
businessesProduction and/or revenue sharing between
investor and user of investment for as long as the investment is used
No 'interest' (money for the use of money)Sharing of risk and reward – no default
Capital Partnership
CustodianCustodian
Investors
Payment
% %
Use
Managers
Users
Capital Partnership reinvents Equity
Equity Shares - % age shares in flows of revenue or production
03/04/10 14
Stock – returnable in payment for use value eg rentals, Kilowatt Hours
Example: “The Art of Flirting” – a film incorporated as an LLP
31/05/10 16
The actors received nth’s of gross revenues
31/05/10 17
I got 5%...and the producer the rest
31/05/10 18
But we needed lights, cameras, pizza, coffee
31/05/10 19
Capital Partners invested £ for 20% of the revenues....
31/05/10 20
...if there are any
31/05/10 21
Art of Flirting Partnership
CustodianCustodian
Financial Capital(Investors)
Financial Capital(Investors)
ViewersViewers
Human Capital(Actors, Producer, Me)
% %
£
31/05/10 22
Capital Partnerships are not Organisations
03/04/10 23
They do not own anything, do anything, employ anyone, or contract with anyone...
03/04/10 24
Associative agreements require no legislation
Custodians(National)
Custodians(National)
Financial Capital(Money, IP etc)
Financial Capital(Money, IP etc)
UsersUsers
Human Capital(Developers, Operators)
% %
Payment
03/04/10 25
Transition
16/06/10 26
Energy subsidies in the Middle East alone cost trillions of dollars
16/06/10 27
Investment in the global transition to renewable energy needs trillions of dollars
16/06/10 28
How do we make the connection?
16/06/10 29
Energy Stock
CustodianCustodian
InvestorInvestor
UserUser
Energy Energy
Energy
ManagerManager
Stock - returnable in payment for energy
05/04/10 31
Mega Watts: renewables funded by unitising Energy Pool of production.
05/04/10 32
Nega Watt energy savings - the cheapest energy - funded by an Energy Loan in Units
09/03/10 33
Energy Loans in KwH made to properties & repaid via utility bills out of energy saved
09/03/10 34
Funded by investors who invest through buying Units in Energy Pools
09/03/10 35
Energy Loan of £5,00050 Units of 1 Megawatt Hour @ £100 per Unit
09/03/10 36
5,000 Units of 10 Kilowatt Hours @ £1.00 per Unit...and so on
09/03/10 37
Reduced energy bill for energy consumed
09/03/10 38
Energy Loan repaid through buying Units from the Pool at the market price
09/03/10 39
The UK 'Green Deal' – Compound interest and Jevon's Paradox
09/03/10 40
Stock: saving energy is saving money
09/03/10 41
But how do we transition from a carbon economy?
09/03/10 42
Transition through Gas
09/03/10 43
Carbon Levy - initially on gas - funds Energy Pool investment in renewable Mega Watts
09/03/10 44
…and Green Deal investment in Nega Watts
09/03/10 45
An Energy Dividend is paid in Stock
09/03/10 46
The outcome is that those with above average carbon fuel use ...
….make a net transfer to those with below average use of carbon fuel
“If you want to keep a cow healthy, you don’t regulate what comes out of it……”
“……you regulate what goes in….”
Energy Pools enable Carbon currency based upon the intrinsic value of energy…
..rather than a market in value-less Units of CO2 emissions, imposed by governments
No dollars change hands but transactions are priced against the dollar
The $ may come to be fixed against a unit of energy – an Energy Standard
Thank You
03/04/10 55
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