Posts filed under ‘Green Marketing’
Companies involved in offsetting their carbon footprint have access to over twenty tools to calculate their emissions, most of which have been launched in the last year. So far, the voluntary carbon offsetting market is dominated by European players. Reviews of their efforts have not been all too positive, so US companies following in their footsteps do best to avoid the pitfalls.
The main criticism centers on what´s left out of the equasion. Companies embarking on greening up their business practices are faced with a daunting task and most go about it the `easy way´ at first. There´s the option to simply offset carbons on the Chicago Climate Exchange, the European Climate Exchange or on the newly established NYMEX venture, the Green Exchange. Businesses have access to these exchanges if they wish to reduce their overall greenhouse gas emissions by as little as 1%.
European carbon traders are eagerly awaiting benchmark numbers on European greenhouse gas emissions during 2007. European countries ought to have submitted the data in a central system yesterday but many failed to meet the deadline.
That is why the Brussels authorities in charge of the central system have not yet released the information on the Community Independent Transaction Log (CITL), the central system. The numbers are key because they allow market traders to know the right level of demand for the instruments they trade.
EU regulations mandate that energy-intensive companies involved in carbon offsets submit one emissions permit for every ton of carbon dioxide emissions they create. The permits are called EU Allowances (EUAs) and since 2005 there’s been a healthy trade in them. Traders have created futures and options derived from the EUAs. Volumes as well as the prices on the European Climate Exchange have been going through the roof in the past year. During March 2008, almost 120 million tonnes EUAs were traded, an increase of 61% compared to March 2007.
Reuters interviewed a Deutsche Bank analyst, Mark Lewis, about his expectations for the 2007 emissions levels. Lewis expects 2007 carbon dioxide emissions to be between 2,180-2,220 million tons. 2007 levels were between 2,100-2,140 million tons.
The 2008 permit supply is 2,083 million tons, which means there’s a shortage of supply. EUA prices will likely rock once the data is released. Lewis estimates the price is likely to go up to 35 euros per ton during 2008-12. Last Friday, EUA futures contracts were trading down 14 cents at 22.12 euros ($34.87).
During the first phase of the carbon market (2005-2007) trading was characterized by an oversupply of permits which caused the carbon price to fall.
The UK has independently already released its estimates for 2007 emissions levels. Government officials published provisional figures showing UK emission levels reached 639.4 million tonnes, which was 2 percent lower than the 2006.
The authorities in charge of CITL reported that not enough data had been submitted for them to release it. At least 80% of the data entered for the 2006 emissions needs to have been reported before the numbers will be released. This is so the markets don’t trade on false information.
CITL announced that it won’t ‘give public access to installation-level verified emissions data today [April 1]’. Instead, the data will be released as soon as enough submissions have been registered to make the 80% grade.
The officials in charge will release the numbers until at least 80% of the data that was submitted in 2006 has been entered.
Angelique van Engelen writes http://Amplifiedgreen.wordpress.com, a blog about micro green options, macro perspectives.
The green marketing hype has great potential for cutting it real thin when it comes to alcohol. No regulators are interfering yet, so McCormick Distillery will likely inspire other minds with the campaign for its new -ultra luxerious- 360 Vodka brand. The company says it will donate $20 for each case of bottles sold in Florida to the Coastal Conservation Association (CCA) in that state. On top of that, McCormick donates $1 to an environmental cause per case sold nationwide.
The marketing message is so powerful you’d think they were selling milk; McCormick’s newly established Earth Friendly Distilling Co. says the 360 Vodka has been ‘sustainably developed and packaged’. The company ‘establishes new standards’ in the distilling industry. Bottles are made from 85% recycled glass and the New Leaf label is made from 100% PCW paper. The inks used in both the label and the rest of the package prints of the 360 Vodka are not petroleum but water based.
The list goes on. Distillation facilities meet all EPA air and water quality standards. That means that sulfur dioxide emissions are down 99%. Volatile organic compounds output is slashed 70%. Fossil fuel energy saved? 250%, according to the company. All is great! What’s even better, the company will find a willing ear among consumers; research just out by Mintel, the consumer research organization, shows that consumer appetite for ‘green’ food is driven by health considerations.
Mintel’s Green Living report points out that there is a link between health concerns and a desire to eat organic food. The market is booming, Mintel says, estimating the natural food and drink products market to be $19.6 billion this year, up from $11.9 billion in 2007. Producers play into this by becoming ever more innovative in new product development.
The research document singles out ‘green’ alcoholic beverages as particularly fast growing. Other than spirits, locally produced wine is experiencing growth due to the industry’s efforts to counter worries about its heavy usage of glass and impact on the environment due to huge producer-consumer distances. ‘Roll out the barrel’ never sounded so giddy.
We’ve landed in an era that environmentalists 40 years ago could only dream about. It ain’t science fiction but these days the game’s all about timing nevertheless. As companies embark on going green, there’s a need for guidance on what makes production processes green. Banks and credit institutions appear to be taking over from governments in setting benchmarks.
For a long time the onus has been on government institutions to stimulate businesses to ‘green up’. But the agenda appears to have been hijacked by credit institutions. So if you’re interested in environment matters and are not so familiar with the boys in the pin striped suits, you might soon be. Even though the world is largely ruled by official policy makers, politicians have a knack for being too slow when it comes to the environment.
Complaints environmentalism might have been declared dead by Michael Shellenberger and Ted Nordhaus (authors of The Breakthrough) but let’s not drop the donkey just yet.
True, the Wallstreet is putting much-needed momentum in the efforts to reduce greenhouse gas emissions, all the more so because the Yanks will want to outcompete European efforts. But a nasty side effect of competition is that it’s too ruthless for balanced judgements on what is fair. The European financial markets have been involved in environment based products for much longer and have developed a competitive edge that will be difficult to beat.
Last week, the Green Exchange, started trading. The new exchange, part of the New York Mercantile Exchange (NYMEX) will have a hard time competing with the European climate exchange. Last year, $62 billion (E40 billion) worth of carbon credits were traded in Europe, which was a massive hike of 80% compared to the year before.
In the absence of practical regulations aimed at reducing corporations’ carbon emissions, trading carbons might be one way of getting the rule structures in place. But this is where the business gets tricky. The funds that invest in these carbons are imposing their own requirements of what makes a carbon neutral business.
And it’s the Wild West all over; invent a common sense bunch of rules and shout loud in the industry and to shareholders and you won’t even have to market your fund. Now that sensible humans no longer risk their personal reputations if they take global warming threats seriously, the free for all is really taking off. Everybody involved knows that there is no such thing as a non-ulterior motive in the investment business. And many awkward situations arise.
The run on everything green is massively driven by oil prices. At the moment there are some 75 environmental funds compared to only a few three years ago. These are mostly hedge funds (derivatives contracts funds).
Skepticism voiced from within the world of finance itself underline that these funds are merely investment opportunities which are cleverly marketed. But they don’t necessarily resolve any of the world’s problems. The same banks that run the environmental hedge funds have dual policies in place; on the one hand their fund management department will invest in ‘ethical’ companies that have been subjected to rigorous research and the corporate finance department will finance the very companies that are responsible for heavy handed pollution, often without any ethical issue questions asked.
True, the ratings agencies are going to provide new ratings on how green a company is and link their credit risk to global environmental issues. All that is great, but who mandates the rules? Who assures that these assessments are implemented in a fair way? When regulation is left up to the finance industry itself, conflicts of interest easily arise.
One high profile official of Duke Energy, the US power company, recently complained to The Economist that the same banks that stipulate new rules on funding of (polluting) power-plants are failing to tighten loan terms for the power plants’ parent companies.
One finance expert and climate change skeptic, Steve Milloy of the Free Enterprise Action Fund, claims the banks’ environmental initiatives are “at best greenwashing, and at worst value-destroying”.
Theoretically it’s of course up to the government legislators to eke out the rules. But, as so often, reality by-passes politics. Climate change is increasingly seen as a major risk and due to the European finance sectors’ longer track record, the Americans are jumping on the bandwagon now with reckless abandon.
“Corporate boards have a ‘fiduciary duty to analyze risk’, according to Mindy Lubber a fund manager responsible for $5 trillion worth of ethical funds who recently spoke at the Wall Street Journal’s ECO:nomics conference. She argued that the way forward is by getting the market to put a price on carbon so that companies can take the lead to limit emissions. Lubber bets on the prospect that a technological revolution will result from this type of herding, something that’s very much alive in the Green IT sector itself, judging from the address by a Sun Microsoft Systems official at a Vancouver conference yesterday.
Steve Milloy, who shared the stage with Lubber, said that this ain’t nothing but hot air. He believes that so-called social activists are simply by-passing the government and going directly to the corporate sector with a bunch of false claims. The result, he said, is that companies are failing to really execute change. He also has little time for the few initiatives in Capitol Hill and slagged off the Lieberman-Warner Bill as ‘an economy killer’ on a par with ‘Don Quixote technology’ wind turbines.
The need for proper guidelines was underscored last month, when a group of the 40 top institutional investment houses (with combined funds of $1.5 trillion) officially requested that the US Congress introduce a mandatory national policy to reduce greenhouse gas emissions by up to 90% below 1990 levels by 2050.
If anything is clear from the viewpoints of these two people who both make investment decisions every day that affect the world in ways we have yet to discover, it is that there’s a huge dichotomy between opinions and investment styles. The strange thing is that both are supported and can carry the day even in a total absence of regulations. But both the experts know that the winner is no longer automatically the one that makes the most money. This is where real values take on a new kind of meaning.
There is lots more to report on these issues. Stay posted here for updates on how the rules for corporations are taking shape. Or better still, subscribe to our RSS feed.
A Welsh eco community have been granted permission to build a settlement of nine eco-smallholdings on a plot of 76 acres close to the village of Glandwr. The community submitted plans for five detached houses as well as a row of four dwellings built from straw bale, mud and timber. Water will be collected from an existing spring and rain captured from turf-made rooftops.
The community, made up of the low-impact lifestyle group calling themselves Lammas will build their off-grid, earthy homes using renewable energy derived in part from a water turbine system. They will also capture bio gas from composting all organic waste through compost toilets, compost heaps and wormeries.
The nine families plan to create fuel from coppiced willow and elephant grass which they are going to grow in the community. For their daily needs they will depend on small scale farming by producing goods such as flax-made linen shawls, compost worms and vegetables and fruits that they will sell on site and via local shops.
“We plan to be largely self-sufficient, growing most of our food. We will keep cows, geese, chickens, ducks and bees. We plan to grow hazelnuts, apples, plums and strawberries as an income. All our fuel will be grown on the plot using a willow short rotation coppice. We intend to supplement our income by continuing to work one day a week,” the village’s co-founder Paul Wimbush, told a Welsh newspaper. He added that the nine families will be 75% self sustainable.
The Lammas’ eco community is the first to be granted official approval in the UK, where thus far only two local authorities have legislation in place that promotes ecological living. After submitting their plans for the first time, the Lammas were rejected because of lack of detail and Pembrokeshire county council planning authorities’ worries that some of the building materials used and the potential graffic generation of the plans were not low impact. The group then took five months to draw up a second batch of plans, which were approved. “We made the whole application electronic and we had the idea of putting it on our website so that people can see what we are talking about,” Wimbush was quoted as saying on NewBuilder.co.uk.
It appears that most Asian companies attempting to ‘green up’, start off in their IT departments. A survey of businesses and consumers published today in Korea IT News reveals that green IT has ‘commercial value beyond the conceptual level’, but that companies have yet to wholly embrace eco friendly strategies.
“The concept of Green IT is emerging as a substantial market for producers and consumers”, reports Korea IT News. The paper’s survey into green IT values included over 140 business representatives and more than 600 consumers about eco friendly IT. Some 52.9% of all respondents said that they will choose a green IT product if its price is 5% more expensive than non-environmental product. And half of all surveyed people said that they will buy a green-IT product at a price that is 10% higher.
Company efforts to improve their green status are focused on commissioning their IT departments to develop energy-saving technology and to incorporate eco-friendly parts into electronics. Of 142 business employees, 15% said that their companies have an exclusive team for green IT and 33% said that their companies were considering such plans.
“Still, many companies did not implement the enterprise-wide eco-friendly strategies. Only 20% of respondents said that they established the environmental management system and 11% said that they provide the green IT education to employees”, according to the newspaper.
Organic photoelectrochemical, dye-sensitized cells, a new type of solar energy, is expected to hit the market this Summer. The technology, which is easy and cheap to use, will be embedded in hundreds of day-to-day consumer products. The dye cells can be used for windows, building facades, gadgets and even in clothing. The pioneer behind the technology is a Swiss professor named Michael Gratzel, who claims that his invention is more robust than regular photovoltaic panel solutions.
Dye based solar cells are made of titanium oxide nanochrystals. These are coated with light absorbing dye that can be used in various materials including glass and plastic. The dye is immersed in an electrolyte solution. When light reaches the surface, the dye sets free electrons which in turn create ‘holes’ – positive charges as a result of ‘lost electrons’. The titanium dioxide semiconducts and transfers electricity to an electrical circuit and energy is created.
The solar cells convert light to electricity with an efficiency of 7.2 percent, which is a record for this type of cell. Solar panels typically convert 16 percent to 20 percent of light into energy. But the advantage of the organic dye cells is that they also convert low light and that they can be ‘tuned’ for specific wavelengths.
The first company manufacturing dye sensitized solar cells is Konarka, which is based in Lowell, MA. This company announced it had successfully conducted the first-ever demonstration of manufacturing solar cells by highly efficient inkjet printing ten days ago. Konarka is focusing on getting the technology embedded in hundreds of day to day products. In the Summer Konarka is planning on shipping out its first products, mainly gadgets, lights and smart cards.
One drawback of the solution’s first editions was that the electrolyte could start to leak in cases of high temperatures. This has been redressed by altering the electrolyte liquids. Grätzel and his team refined this original design by optimising the sensitiser and using organic dyes based on indoline. This allows the titanium oxide to be thinner, which reduces the electron path length.
Michael Gratzel explained in a recent scientific paper published in Inderscience’s Angewandte Chemie how he’s sophisticated his technology.