SUSBIZ Sustainable Business Strategies.
A few notes on how climate change and sustainability affect business. I’m going to talk about the Archbishop of Canterbury, Lord Stern and the Institute of Directors. I’m running a teleclass with a few places left on Tuesday, and next week I shall be going up to the Low Carbon Best Practice Exchange in Newcastle. The RPI has come down, the CPI has gone up but the COBRA Matrix will help you deal with it, and at the beginning of May the Prince of Wales has his Mayday Summit on Climate Change.
Although the economy is in a state that nobody has seen for many, many years, it hasn’t pushed climate change and sustainability off the agenda. Pressure is coming from all quarters. The latest is the Archbishop of Canterbury who said that the case for action on climate change was a moral as well as a practical one. On Tuesday’s Radio 4 Today Programme he warned that billions could die if governments and individuals did not take moral responsibility for climate change now. Didn’t James Lovelock say much the same a few weeks ago? This comes after Lord Stern’s presentation to the Copenhagen Climate Conference when he said that the situation was very much worse than he had thought when he prepared his report on the economic consequences of climate change back in 2006.
But let’s not be negative! At a recent Institute of Directors event addressed by IOD environment spokesman David Boomer and by Todd Holden from Enworks we were told how adopting environmental policies could lead to a direct improvement in the bottom line. On the basis of studying more than 2000 companies it’s been shown that they saved 8% on energy, 2% on materials, 13% on water and up to 50% on waste. You can do a lot of this without spending any money. Apparently 70% of savings come from behaviour change. If you do need to invest to save, there’s a range of low carbon grants and soft loans. I’ve recently been looking at the work of Bob Willard who is a specialist in sustainable business based in Canada who also talks about the savings on staff costs which can be made from environmental policies; from improved morale and productivity to lowered recruitment costs and less turnover. It all depends on the structure of your business, of course, but anything that can make a quantifiable improvement to your bottom line, particularly in the present economic climate, must be valuable regardless of where it comes from.
Next Tuesday 31st March I’m running a teleclass which will cover these points and expand on them. This event is by invitation only but there are one of two places still available so if you want to take part please log on now to this link and you’ll find full details. The session will take place at 18:00 BST but if you can’t make it there will be a recording which will be available the following day.
Next week on 2nd April I shall be running a roundtable discussion session at the Low Carbon Best Practice Forum in Newcastle. If you haven’t already registered for the event go to www.Carbon–innovation.com
The big news this week is that inflation is going up, or at least it is as far as the Consumer Price Index is concerned. It’s risen from 3% to 3.2% while the Retail Price Index has declined to zero; no change. The difference is that the RPI includes housing costs which have been falling as house prices fall and mortgage rates are cut. Both these inflation indices are very crude instruments; it all depends on your lifestyle as to whether your costs are rising or falling. The other issue is the oil price. It peaked at $147 last July and crashed to $36 in January. Now it’s on the rise again - and after adjusting for the exchange rate in the UK it’s halfway back to last year’s peak.
In business, each organisation has its own set of risk factors and I’ve derived the COBRA Matrix to help managers balance impact against possibility. I’ll be covering this in Tuesday’s teleclass and there will be examples of the COBRA approach in the accompanying working papers. Download them here.
As I said to start with, pressure and the realization of the impact of climate change are coming from all quarters. On 1st May the Prince of Wales’s Mayday Summit on Climate Change takes place for the third year running. It brings together businesses at regional centres all over the country to report on progress and to commit to Carbon Reduction and environmental improvements for the year ahead. You can sign up here.
Government regulations demand that business become environmentally responsible and despite the economic environment, consumers are continuing to demand that organisations are green as well. You can find details of a survey published by the Carbon Trust here.
You don’t have to look far to find people who say how dreadful, how terrible, how earth-shattering the risks from climate change are. I prefer to concentrate on the opportunities for staying in business and staying in profit. In the coming weeks I shall be interviewing people from the Carbon Trust and Virgin Media among others to reinforce the positive message.
If you want to add your comments I look forward hearing from you. Add them to this blog or give me a call.
My name’s Anthony Day and my number is 01904654986. I hope we’ll talk soon.
Showing posts with label carbon neutrality. Show all posts
Showing posts with label carbon neutrality. Show all posts
Friday, March 27, 2009
Monday, March 16, 2009
The Age of Stupid
Do we need another misery movie?
Review: The Age of Stupid - premiere at Leicester Square and 65 cinemas across the country.
In The Age of Stupid Pete Postlethwaite addresses us from the wrecked planet of 2055 and asks how we could be so stupid as to let climate change destroy humanity. He flicks through endless archives showing us the obvious clues to catastrophe from 2009 and before. It seemed a long film, partly because technical problems meant that about 30 minutes of footage was played twice. Partly, too, because it replayed the breast-beating and lamentations already seen in Al Gore’s An Inconvenient Truth, Leonardo di Caprio’s The Eleventh Hour, The Day After Tomorrow and all the rest.
What these films lack, and that includes the live debate following The Age of Stupid, is a credible call to action. Watching this film you might conclude that the best thing to do is to run your car on chip fat, live self-sufficiently on a small holding and protest against the nasty nimbies who oppose wind farms. It goes without saying that there’s not enough chip fat and not enough smallholdings. The effectiveness of wind farms is also very much in doubt. After the film Pete Postlethwaite pledged to give back his OBE if the government approved the proposed new Kingsnorth coal-fired power station. Ed Milliband was there to respond, but they let him off extremely lightly by not once mentioning government support for Heathrow’s third runway. Surely that’s a much more powerful national political issue than some power station down in Kent.
Sustainable economic growth is still possible in a low carbon economy, but if we are going to solve this problem we must all drive less, heat less and consume less. Life will be very different - potentially much more pleasant - if we take the low-carbon route. The Age of Stupid has missed the opportunity to show what ordinary people can do to safeguard our future, and to show what sort of future we can all enjoy if we act now. Certainly the showing raised enthusiasm both in Leicester Square and in the cinema where I was, but I fear that people will be rushing off to protest, rather than rushing off to change their lives.
Review: The Age of Stupid - premiere at Leicester Square and 65 cinemas across the country.
In The Age of Stupid Pete Postlethwaite addresses us from the wrecked planet of 2055 and asks how we could be so stupid as to let climate change destroy humanity. He flicks through endless archives showing us the obvious clues to catastrophe from 2009 and before. It seemed a long film, partly because technical problems meant that about 30 minutes of footage was played twice. Partly, too, because it replayed the breast-beating and lamentations already seen in Al Gore’s An Inconvenient Truth, Leonardo di Caprio’s The Eleventh Hour, The Day After Tomorrow and all the rest.
What these films lack, and that includes the live debate following The Age of Stupid, is a credible call to action. Watching this film you might conclude that the best thing to do is to run your car on chip fat, live self-sufficiently on a small holding and protest against the nasty nimbies who oppose wind farms. It goes without saying that there’s not enough chip fat and not enough smallholdings. The effectiveness of wind farms is also very much in doubt. After the film Pete Postlethwaite pledged to give back his OBE if the government approved the proposed new Kingsnorth coal-fired power station. Ed Milliband was there to respond, but they let him off extremely lightly by not once mentioning government support for Heathrow’s third runway. Surely that’s a much more powerful national political issue than some power station down in Kent.
Sustainable economic growth is still possible in a low carbon economy, but if we are going to solve this problem we must all drive less, heat less and consume less. Life will be very different - potentially much more pleasant - if we take the low-carbon route. The Age of Stupid has missed the opportunity to show what ordinary people can do to safeguard our future, and to show what sort of future we can all enjoy if we act now. Certainly the showing raised enthusiasm both in Leicester Square and in the cinema where I was, but I fear that people will be rushing off to protest, rather than rushing off to change their lives.
Tuesday, July 17, 2007
Let’s go carbon neutral!
Channel 4 was severely criticized for its programme about the "Great Global Warming Swindle" and last night turned its attention to carbon offsetting. This was an altogether more balanced documentary and demonstrated that the ideas of carbon offsetting and carbon neutrality need to be approached with scepticism.
Many big names on the high street, including HSBC, Barclays, Sky and Marks and Spencer either claim to be carbon neutral or to be on the way to achieving that state. What does this mean? Every individual, household or organization causes a certain amount of carbon dioxide, the principal greenhouse gas, to be emitted. The major trigger is energy; we all use energy and most of it is created from the combustion of fossil fuels – oil, gas or coal.
Organizations that want to be carbon neutral try and reduce their use of energy as far as possible. For the energy that they cannot avoid using, they deal with the emissions caused by buying offsets. For example, if a lorry travelling the length of the country day in and day out creates ten tons of carbon dioxide, planting a specified number of trees will cause that CO2 to be absorbed. The programme showed other offsetting projects: the pig farm where methane from the pig manure was trapped and prevented from escaping into the atmosphere; the hydroelectric power station in Eastern Europe which emits no CO2 at all. If an organisation buys enough offsets it can claim that the net effect is neutral - overall it is adding no CO2 to the global atmosphere.
The problem is that there are inconsistencies and imprecision at every stage of the process. To start with, you need to define exactly how much carbon dioxide is being emitted before you know how much you have to offset. There are no universally agreed standards and this can lead to farcical situations. If you want to offset the emissions created by your air travel, British Airways will sell you offsets provided by Climate Care. However, if you approach Climate Care directly to offset your flights, they will charge you more because they use a different method of calculation from British Airways and they believe that the emissions caused by flights are greater.
Suppose we have agreed on how much carbon dioxide needs to be offset. How effective are the proposed solutions? There is no doubt that trees absorb CO2 as they grow. It will, however, take several decades to absorb the CO2 that your flight emits in an afternoon. Some of the trees shown on the programme were far more heavily subsidized by the Forestry Commission than by the purchasers of offsets. If the trees would have been planted anyway, they cannot be considered as truly offsetting a particular purchaser’s emissions. There is also the problem that trees do not live for ever and while they may a lock up the carbon dioxide for a time, it will be released when the tree eventually dies and rots or is burnt. In any case, when you think of the hundreds of thousands of people in the UK who make flights every day, it is clear that trees cannot be the whole solution.
What about the hydroelectric power station in the Eastern Europe? Suppose the developer has the choice between a fossil fuel power station emitting CO2 and a hydro station which emits none. If this is a new development, building the hydro station avoids a certain amount of CO2 emissions, but it does not reduce emissions unless a fossil fuel station of the same size is closed down. There was no suggestion in the film that this was the case, (and by the way it seemed unlikely that the carbon offset payments made by Sky to the project had had any effect on whether it was going to be built or not.) The scheme does not appear to have reduced the global CO2 burden so it cannot be considered as an offset. Sky’s claim to be a carbon neutral organization is difficult to support.
As I said at the start, there is no clear universal definition of carbon footprints or carbon neutrality. Organizations can define them as they wish and can, in their own terms, claim to be carbon neutral. This is good marketing and attractive to responsible consumers. The problem is that it is doing practically nothing to reduce the CO2 in the atmosphere or to have any effect on climate change.
It is very much like rearranging the deck chairs on the Titanic. It may make people feel more comfortable and make them believe that something is being done about the dangers ahead. In fact there are icebergs ahead – only this time the problem is that they’re melting!
Many big names on the high street, including HSBC, Barclays, Sky and Marks and Spencer either claim to be carbon neutral or to be on the way to achieving that state. What does this mean? Every individual, household or organization causes a certain amount of carbon dioxide, the principal greenhouse gas, to be emitted. The major trigger is energy; we all use energy and most of it is created from the combustion of fossil fuels – oil, gas or coal.
Organizations that want to be carbon neutral try and reduce their use of energy as far as possible. For the energy that they cannot avoid using, they deal with the emissions caused by buying offsets. For example, if a lorry travelling the length of the country day in and day out creates ten tons of carbon dioxide, planting a specified number of trees will cause that CO2 to be absorbed. The programme showed other offsetting projects: the pig farm where methane from the pig manure was trapped and prevented from escaping into the atmosphere; the hydroelectric power station in Eastern Europe which emits no CO2 at all. If an organisation buys enough offsets it can claim that the net effect is neutral - overall it is adding no CO2 to the global atmosphere.
The problem is that there are inconsistencies and imprecision at every stage of the process. To start with, you need to define exactly how much carbon dioxide is being emitted before you know how much you have to offset. There are no universally agreed standards and this can lead to farcical situations. If you want to offset the emissions created by your air travel, British Airways will sell you offsets provided by Climate Care. However, if you approach Climate Care directly to offset your flights, they will charge you more because they use a different method of calculation from British Airways and they believe that the emissions caused by flights are greater.
Suppose we have agreed on how much carbon dioxide needs to be offset. How effective are the proposed solutions? There is no doubt that trees absorb CO2 as they grow. It will, however, take several decades to absorb the CO2 that your flight emits in an afternoon. Some of the trees shown on the programme were far more heavily subsidized by the Forestry Commission than by the purchasers of offsets. If the trees would have been planted anyway, they cannot be considered as truly offsetting a particular purchaser’s emissions. There is also the problem that trees do not live for ever and while they may a lock up the carbon dioxide for a time, it will be released when the tree eventually dies and rots or is burnt. In any case, when you think of the hundreds of thousands of people in the UK who make flights every day, it is clear that trees cannot be the whole solution.
What about the hydroelectric power station in the Eastern Europe? Suppose the developer has the choice between a fossil fuel power station emitting CO2 and a hydro station which emits none. If this is a new development, building the hydro station avoids a certain amount of CO2 emissions, but it does not reduce emissions unless a fossil fuel station of the same size is closed down. There was no suggestion in the film that this was the case, (and by the way it seemed unlikely that the carbon offset payments made by Sky to the project had had any effect on whether it was going to be built or not.) The scheme does not appear to have reduced the global CO2 burden so it cannot be considered as an offset. Sky’s claim to be a carbon neutral organization is difficult to support.
As I said at the start, there is no clear universal definition of carbon footprints or carbon neutrality. Organizations can define them as they wish and can, in their own terms, claim to be carbon neutral. This is good marketing and attractive to responsible consumers. The problem is that it is doing practically nothing to reduce the CO2 in the atmosphere or to have any effect on climate change.
It is very much like rearranging the deck chairs on the Titanic. It may make people feel more comfortable and make them believe that something is being done about the dangers ahead. In fact there are icebergs ahead – only this time the problem is that they’re melting!
Tuesday, July 03, 2007
Mac mileage
So McDonalds are going to use waste cooking oil to power their vehicle fleet. This is a company we all seem to love to hate, and at first sight we could be critical and point out that biofuels are certainly not carbon neutral and that growing crops for biofuel is already having an effect on the price of wheat. Nevertheless, McDonalds deserve congratulation for this initiative because they are using waste cooking oil to create the fuel; oil that would otherwise have to be disposed of carefully to avoid creating pollution.
A plant already exists in Scotland which creates biodiesel from organic waste. It’s pure recycling. It’s getting a useful product from material which otherwise would be dumped.
In the north east of England two major plants are under construction for the production of biofuel. These will use specially grown – and imported – raw materials and there is already much doubt and debate about the effects that growing these crops will have on rainforest clearance and on food production in poorer countries. I also wonder how long the producer countries will be prepared to export the raw materials. If they harvest and process the biodiesel at home, they have a much higher value product to sell, and surely it makes more sense to export finished goods than vast quantities of bulky primary goods.
Biofuel from waste is truly green – so three cheers for Ronald McDonald!
A plant already exists in Scotland which creates biodiesel from organic waste. It’s pure recycling. It’s getting a useful product from material which otherwise would be dumped.
In the north east of England two major plants are under construction for the production of biofuel. These will use specially grown – and imported – raw materials and there is already much doubt and debate about the effects that growing these crops will have on rainforest clearance and on food production in poorer countries. I also wonder how long the producer countries will be prepared to export the raw materials. If they harvest and process the biodiesel at home, they have a much higher value product to sell, and surely it makes more sense to export finished goods than vast quantities of bulky primary goods.
Biofuel from waste is truly green – so three cheers for Ronald McDonald!
Thursday, May 31, 2007
Good Housekeeping
More and more organisations are adopting environmental policies and taking specific actions to implement them.
Eclipse Internet, the ISP within Kingston Communications, has recently announced that it is carbon-neutral. The main input to an IT company is power and in calculating the organisation’s footprint Eclipse also included the emissions due to the daily commute of the workforce. This proved to be a not insignificant 23% of the total. Beyond making sure that heating and lighting in the offices is as efficient as possible there is only so far that such a company can go to reduce its carbon footprint without offsetting.
Carbon neutrality has been achieved in collaboration with the CarbonNeutral Company, by investing in projects which will either produce power without CO2 emissions or positively reduce CO2. Eclipse has invested in wind-farm technologies in India, a methane capture project in Pennsylvania and a Ugandan forestry project. All of these are designed not only to reduce carbon dioxide but also to support the local economies.
Carbon neutrality has a money cost – the cost of investing in the offsetting projects. The return is more difficult to quantify, but consumers are becoming more insistent that everything they buy should be “ethical”, “green” and “eco-friendly”. In response many big names on the High Street are making the investment. In time carbon neutrality may become the norm - or at least the aim - for every company (though not every company will be able to achieve it). Some progress towards carbon neutrality is likely to be expected of any organisation seeking public contracts.
Those who are first into this area will probably find their goals easier to reach through a wide range of offsetting projects. Later converts will have a smaller choice, but hopefully will sign up anyway.
Hopefully too, the market will be regulated so that the marginal operators who have been giving offsetting a bad name will be squeezed out.
Eclipse Internet, the ISP within Kingston Communications, has recently announced that it is carbon-neutral. The main input to an IT company is power and in calculating the organisation’s footprint Eclipse also included the emissions due to the daily commute of the workforce. This proved to be a not insignificant 23% of the total. Beyond making sure that heating and lighting in the offices is as efficient as possible there is only so far that such a company can go to reduce its carbon footprint without offsetting.
Carbon neutrality has been achieved in collaboration with the CarbonNeutral Company, by investing in projects which will either produce power without CO2 emissions or positively reduce CO2. Eclipse has invested in wind-farm technologies in India, a methane capture project in Pennsylvania and a Ugandan forestry project. All of these are designed not only to reduce carbon dioxide but also to support the local economies.
Carbon neutrality has a money cost – the cost of investing in the offsetting projects. The return is more difficult to quantify, but consumers are becoming more insistent that everything they buy should be “ethical”, “green” and “eco-friendly”. In response many big names on the High Street are making the investment. In time carbon neutrality may become the norm - or at least the aim - for every company (though not every company will be able to achieve it). Some progress towards carbon neutrality is likely to be expected of any organisation seeking public contracts.
Those who are first into this area will probably find their goals easier to reach through a wide range of offsetting projects. Later converts will have a smaller choice, but hopefully will sign up anyway.
Hopefully too, the market will be regulated so that the marginal operators who have been giving offsetting a bad name will be squeezed out.
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