31 December 2009

Green Decade: Were the Aughts All for Naught?

It was the best of decades; it was the worst of decades. Any way you slice it, the Aughts were a surprising decade for the green movement.

Janus-headed, the Aughts were, as entrepreneur and hedge-fund blogger Howard Lindzon pointed out in his end of the decade post, the "decade was all about two things, creative and greedy destruction."

From the Clinton/Gore failures to act on climate change when they had the opportunity, if not the Congress, to the Bush Administration's eviscerating the EPA and altering documents while encouraging quiet progress on emissions reductions, doesn't seem like a decade of progress.

Still, the Aughts saw "sustainability" and "green" move decidedly more mainstream, but it didn't start out that way.

In early 2000, just before the dot-com bubble burst, I was being romanced by a start-up called "Verde.com," which billed itself as "a 360-degree media company, like Martha Stewart." Unfortunately, there was no Martha Stewart in the model, and the idea was seven years too soon. It flamed out by summer.

By 2007-08, Al Gore became the Martha Stewart of Green, and Discovery Communications launched "planet green," which had a lot of similarities to the Verde model. Green became the new Black.

Celebrities jumped on the bandwagon, driven by Mr. Gore, and the environment even had its own rock extravaganza. But despite its celebrity staying power, and some traction even in the wake of recession, at decade's end consumer choices still have "more to do with the personal benefit as opposed to having some sort of general sense that we have to save the planet," as GfK's Tim Kenyon told Joel Makower.

And there is a growing sense that, despite the scientific "consensus" on climate change and heightened public awareness brought about by Mr. Gore's Academy Award-winning film, "An Inconvenient Truth," environmentalists and climate scientists alike may have played too heavy a hand when it comes to the "climate crisis."

At the end of the Aughts an increased number of Americans believe global warming is exaggerated and fewer see solid evidence of global warming. In fact, as a 2009 Pew study revealed, more Americans believe in angels than human's role in global warming.

Meanwhile, on the practical side, Green Buildings LEED the way. The US Green Building Council launched its certification in 2000 and in the ensuing years it became not only the gold standard, but ubiquitous in the building trade.  So much so that a survey of commercial real estate executives conducted by Turner Construction Company in late 2008 showed that plans to build green would not be affected by credit market conditions.

Biodiversity loss continued to spiral through the decade, with the latest update of the IUCN Red List of Threatened Species cataloging 17,291 out of 47,677 assessed species being threatened with extinction.

While a 2004 study by World Wildlife Fund, Status of Coral Reefs Around the World, found that 20 percent of the world’s coral reefs have been effectively destroyed and show no immediate prospects of recovery, another 24 percent are under imminent risk of collapse through human pressures, and a further 26 percent are under a longer term threat of collapse.

Still, some progress was made on the conservation front with Brazil leading the way. Brazil accounted for 60 percent of total terrestrial conservation during the decade, according to Mongabay.com's analysis of global conservation data. Unfortunately, Brazil also topped the list of forest destroyers, losing 175,000 square kilometers of Amazon rainforest over the decade.

The Aughts may also mark the end of big, global plans, treaties and conventions that fail to inspire or make progress. One of the hard lessons of this decade has been that globalization of environmental action is doomed to failure by entrenched interests. In the teens, big treaties and plans must give way to local action, stewardship, and adaptation.

I learned this the hard way at the Nature Conservancy as we pushed forward with a big hairy audacious goal that was not, ultimately, achievable. When I pressed others on what would happen if we didn't meet our targets by 2015, I was told "we'll just revise the goal." That sounded too much like the UN and World Bank for my taste.

We also watched with horror as centralized decisions to protect forests in one country led to increased destruction in other countries and biofuels production led to unintended consequences, from skyrocketing food prices to forest destruction.

Yet, I have seen how local people from Indonesia to Ecuador and India to the Caribbean are taking action despite big global pronouncements. I remain convinced that conservation needs to be local to be global -- or "glocal," to use Tom Friedman's coinage. We need local action with a global understanding and a heavy dose of scenario planning.

By the end of the decade, the Copenhagen Climate Summit laid a big goose egg on the UN's efforts to get a global agreement on reducing emissions. Tolling the death knell for top-down, government-led negotiations, in my opinion.

This was also the decade when green became gold. Venture investors poured money into clean tech innovations in the latter half of the decade, reaching a record $7.6 billion in 2008 and only dipping to around $5 billion in 2009, as entrepreneurs and investors tried to help lead the economy back to health.

Wal-Mart surprised everybody in the 00s by leading the way with new standards for sustainability on its shelves, in its stores, and up and down its supply chain. Industrial carpet manufacturer Interface made progress on climbing "Mt. Sustainability," and GE re-envisioned itself as a purveyor of "ecoimagination," bringing good and green things to life.

The Toyota Prius hybrid was introduced in July 2000 and, in its peak year of sales 2007, Toyota sold 180,000 units in the United States. But the Aughts truly were the decade of the "other 2-axle 4-tire vehicle," which includes SUVs and light trucks.

In 2000, there were 79,084,979 such vehicles on US roads; by 2007 there were more than 100 million, according to the Bureau of Transportation Statistics. In 2004 alone, GM sold 28,898 gas-hog Hummers, many of them to suburban families and even city dwellers.

Despite the resistance and doublespeak of US auto-manufacturers, by decade's end, Ford saw its hybrid sales increase and was betting its future on cars like the Escape Hybrid, Fusion and Focus, while GM, limping along with the help of a government bailout, promised the plug-in hybrid Volt and was looking for a buyer for its Hummer division.

In 2005, I wrote that the green tent needed to be expanded. Over the decade, the tent expanded, but is it yet big enough? At the start of the decade, green was seen as a pursuit of elite, white highly educated liberals. The complexion has changed a little, thanks to environmental leaders like Van Jones, Majora Carter, and Jerome Ringo, along with religious leaders like Ted Haggard, Jim Ball, and Rick Warren, but has it really become more inclusive?

In many ways, it seems the movement is even more liberal than it was last century as, other than Governors Schwarzenegger and Crist, the GOP has largely abandoned the environment despite the legacy of Republicans Teddy Roosevelt and Richard Nixon. And, in my view, the more partisan this issue becomes, the more ground it will lose.

Were the Aughts all for Naught? I'm guessing not. Really some progress has been made in a decade of extreme triumphs and failures, tragedies and excess. But we've still along way to go.

What lessons have I learned this past decade? I've learned that private, direct action really is the best way to make change happen; that a new green economy is possible only when we figure out how to make it profitable; that neither big governments nor big NGOs are the game-changers and we should put our trust in the entrepreneurs (social or otherwise); and, finally, that efficiency and innovation can help lead the way to a better future.

May the teens, be a decade of progress and prosperity. Happy New Year!

(Thanks to James Bedell of build2sustain and Jamie Burdett of Worn Again for suggestions that led to the focus of this post.)

Reblog this post [with Zemanta]

29 December 2009

Cantwell-Collins: Want $100/month with Your Emissions Cuts?

The Cantwell-Collins "cap-and-rebate" climate bill, known as the Carbon Limits and Energy for America's Renewal Act (CLEAR), proposes refunding 75 percent of all revenue collected back to U.S. residents in a monthly check of about $100 per family of four.

Tim Hurst over at Ecopolitology has a good analysis of the bill proposed by Senators Maria Cantwell (D-Wash.) and Susan Collins (R-Maine), which they claim would reduce greenhouse gas emissions of 20 percent by 2020 and 83 percent by 2050. And without the messy offset program that would be hard to monitor and regulate.

As Peter Barnes wrote in On the Commons, Cantwell-Collins provides "a simple, transparent cap-and-dividend system that returns higher carbon prices directly to consumers and allows only minimal carbon trading. It would cap fossil fuel suppliers like Exxon-Mobil and Peabody Coal, rather than emitters like utilities and steel plants, because it's much easier to catch carbon when it enters our economy than when it leaves."

Barnes explains "it would auction all carbon permits and avoid giveaways, market distortions and offsets. And it would put a 'collar' on the price of carbon permits in order to limit market volatility."

Critics of the bill, however, argue that it will be slower to deliver on reducing emissions (see chart) and will leave little revenue left for investments in clean technologies.

This Bill has garnered some interesting support, such as Dr. Kenneth P. Green at the American Enterprise Institute, which may give it a leg-up over the Kerry-Lieberman-Graham Climate Bill. But, as Tim Hurst rightly points out, "getting any climate legislation passed before November, 2010 is going to be problematic, to say the least."

Camille Ricketts also takes a hard look at the two Senate proposals in VentureBeat's GreenBeat

Reblog this post [with Zemanta]

24 December 2009

Santa: Takes on the Climate Change Skeptics

A few Christmases ago, I published this email from Santa, which arrived on the night before the night before Christmas. Readers had so much fun with it, it's become an annual tradition. Enjoy!

And have a Happy Holiday.

Scott, aka The Green Skeptic


TO: Global Warming Skeptics
FROM: Santa Claus
DATE: A few nights before Xmas
SUBJECT: My Christmas List

This is Santa, writing from the North Pole. Soon I'll be gathering all the toys for all the good little girls and boys and packing them in my sleigh to begin our journey, our night of nights.

The reindeer, however, are starting to complain about hoof-rot. Apparently, they've been standing around in too much slush. This has put me in a decidedly prickly mood this Christmas.

You know me; I'm not a single-issue guy. I believe that as long as you are good, and I mean good for goodness' sake, you deserve some slack on the other stuff. I'm an equal opportunity distributor. I know whether you've been bad or good or just plain evil. You also know I'm not one to discriminate against one group of people or another, believers or non-believers.

But this year is different. This year, I'm making a few changes to my list. I'm checking it twice and have decided that the naughty include any one of you out there who do not believe in global warming. All you climate change skeptics out there, you are on the naughty list this year.

Oh, you know who you are. And I've got one special gift for you: Nothing but COAL. You like the stuff so much -- and it's such a big part of what's leading to climate change -- you might as well have bags and bags of it and nothing more.

Make no mistake. Global warming is happening. You don't have to show me any scientific reports, although some nifty ones have shown up in my email box lately, sent to me from the National Center for Atmospheric Research and the National Snow and Ice Data Center.

No, you don't have to convince me; I'm a believer. All I have to do is look out my window to my back yard, what's left of it! It's a soupy mess out there.

We usually have a good bit of ice up here at the North Pole -- and early. That's important, too; you see, every year the elves and I construct a temporary workshop up here where we make the toys and assemble the other goodies. The earlier the ice, the sooner we get started.

Although I have figured out a way to deliver the entire shipment of gifts on my list in one night, I still haven't perfected the manufacturing process. I can't speed it up. (Some of that I blame on the unions.) We need all the ice we can get up here for there is no solid ground.

But this year, the ice cover was the lowest it's been in almost 30 years. And at least one of those science groups studying this stuff tells me that, according to their models, by 2040, we'll have mostly open water up here. (They sent me this short animation clip, which sends chills up my spine: Arctic Ice Melt.)

Mrs. Claus has even started looking for Houseboats on Craig's List!

So, dear boys and girls, you better not pout or cry or whine or deny climate change any longer. And I'm telling you why: because climate change is coming to town. Time's a wasting. We need to do something about this now, before it's too late. Or before I have to move all of my operations to the South Pole!

Here's wishing a carbon-neutral Christmas to all, and to all a good night.

S. Claus, North Pole

Reblog this post [with Zemanta]

23 December 2009

Green Conflict at UN? The Green Skeptic Weighs-in on Fox Business

Questions about business connections of UN climate chief Dr. Rajendra Pachauri and potential conflicts of interest surfaced in the Telegraph earlier this week. The Green Skeptic talks with Elizabeth MacDonald of FoxBusiness:

Reblog this post [with Zemanta]

21 December 2009

e3bank Reorganizes; Plans New Equity Offering in 2010

Last week, e3bank's Chairman Sandy Wiggins and President/CEO Frank Baldassarre announced tactical changes to their business plan in order to comply with the changing regulatory environment, which will have a direct effect on the bank’s current equity investment offering.

In accordance with the bank's guiding principle of Transparency, e3bank will be closing the current escrow account and will be refunding the full amount of investors' subscriptions with interest before reorganizing and commencing a new amended offering.

"We have decided to withdraw our current capital campaign due to modifications that we are making to our business plan," said Baldassarre. "These modifications reflect extensive discussions with the regulatory agencies and our advisors regarding the new de novo bank process. e3bank is not changing our mission, products or our delivery system."

e3bank currently anticipates starting a new equity offering in the New Year once amending the Offering Circular to reflect changes in the application, and are targeting being able to commence operations by the end of the second quarter of 2010.

I had a chance to catch up with Frank Baldassarre about the changes affecting the bank and the financial markets:

GS: Tell me about the changes in e3bank's structure?
e3: We decided to scale back from having a national scope to focusing on the Metro-Philadelphia area. And the time-frame for regulatory scrutiny has changed from 3 years to 7 years for what's considered a de novo bank, so those changes allowed us to reorganize.

GS: You had an ambitious offering in a tough environment this past year, what will happen with those investments?
e3: We're returning 100 percent of the investments to the investors, plus some interest that was earned.

GS: And what was the reaction from investors?
e3: They were disappointed, as we were, but they also appreciated the transparency. We were living up to that core value. There's been a very favorable response to the way we've handled this change.

GS: What's your outlook for 2010?
e3: We're looking to get regulatory approval as soon as possible and expect to open in the second quarter of 2010. This is the right time for our business model, and our mission will remain identical.

GS: What milestones are you hoping to reach by this time next year?
e3: We hope to be a huge success in the Philadelphia region. Our market research shows that e3bank has strong potential in this market. And we'll have well-managed deposit and loan growth. There's a lot of unmet demand for banks, especially those with a more responsible focus.

GS: Are you seeing the triple-bottom-line (TBL) market expanding or contracting at this time?
e3: We see it continuing to expand, and interest in what we're trying to do has been great. I continue to get asked to speak at conferences, most recently to a group called the Environmental Bankers Association. Overall, I feel strongly about the reception we've received from investors around the world.

GS: Do you think they are responding to the message?
e3: The message of TBL in the financial services sector is resonating; people want to do the right thing and the TBL approach is the right thing. We even had an encouraging note from a banker who was watching our model closely and hoping to adopt some of the principals to his own bank.

GS: I know you can't tell me what bank he was from, but what did he say?
e3: He said, "Keep up the good work!"

And from what we've seen of e3bank thus far, that's just what they will do.

For more details on e3bank, check out: www.e3bank.com.

Reblog this post [with Zemanta]

18 December 2009

Maya Lin's "Unchopping a Tree" from "What Is Missing?"

A few years ago, Maya Lin told me about a project she was conjuring. She said it would be her last memorial. I've been amazed and privileged to see it develop over the years.

Maya takes a complex subject and makes it simple. In her words:

What is Missing? will make the critical link between global warming concerns and habitat protection: if 20% of global warming emissions are caused by deforestation then What is Missing? will integrally connect these issues, asking the question:

Can we save two birds with one tree?

The project will have a number of components, including sound and media installations, permanently installed sculptures at select science institutions, and even some branded products.

With all the brouhaha going on at Copenhagen, it is refreshing to just let an artist challenge our way of thinking about this subject.

Here is Maya Lin's video "Unchopping a Tree," which premiered at the Copenhagen Climate Summit this week:

Maya Lin - Unchopping a Tree from What is Missing? Foundation on Vimeo.

For more information, visit What is Missing?

And here is a link to the poem by W.S. Merwin that inspired the title "Unchopping a Tree"

Reblog this post [with Zemanta]

15 December 2009

The Green Skeptic on Fox Business: "Cash for Caulkers"

President Obama launches yet another "Cash for..." program, this time "Cash for Caulkers" for weatherization and retrofitting.

The Green Skeptic wonders when the "Cash for Stash" anti-drug program is going to start, but thinks perhaps this program may just put contractors and construction crews back to work.

Reblog this post [with Zemanta]

14 December 2009

Not Ready for Cap-and-Trade: US Manufacturers

The carbon cap train may be leaving the station, whether aboard the EPA, White House & Congress Railroad or on the high-speed rail from the Copenhagen Circus.

But left behind and potentially dead on the tracks may be US manufacturers, especially those in the industrial equipment sector.

There are nearly 46,000 industrial manufacturing companies in the US and Canada ranging in focus from machinery, aerospace, and petroleum refining to printing, chemicals, food, and medical devices, to computer systems and peripherals, pharmaceuticals, and paper. (These are the Dunder Mifflins of the world.)

Imagine you are the CEO of a small to mid-size company with under a billion dollars in revenue that supplies a part or product for a larger original equipment manufacturer (OEM).

The OEM is charged with reducing its carbon footprint, but there is only so much it can do at the home office, facilities, and transportation. So the OEM turns to its suppliers and says, "What are you doing to reduce my carbon footprint?"

Suddenly, you are charged with meeting those targets or potentially losing their business. But your company is ill-equipped to track reductions or even to establish a benchmark against which to measure reductions.

"Well," one government official familiar with the situation said to me. "You can use your enterprise software to track various components, just like you do with other management issues."

Maybe, or maybe not.

A new survey conducted by Reed Business Information for IFS North America, a global enterprise applications company, shows that US manufacturers, even large ones, are not ready to measure their environmental impact. (The survey will be available December 28th.)

Many of these companies are currently not tracking environmental metrics, and most lack the technological or management infrastructure to do so in a cost-effective manner.

One survey respondent, who works for an aerospace and defense manufacturing company with more than $2.5 billion in revenue, said his company would "like to have this embedded, versus buying and integrating a third party package or writing my own solution."

Currently, neither Oracle nor SAP, the most widely used enterprise business software applications have built-in environmental footprint management tools.

Oracle recently entered into a partnership with OMRON to "create a solution that will help companies track and reduce energy consumption in manufacturing and non-manufacturing environments," according to a spokesperson with the company.

SAP has several solution modules, including SAP Carbon Impact, but as of this writing it is unclear whether they offer a fully integrated product.

IFS, which commissioned this survey, released a product with an embedded "eco-footprint" tool last February, but they only serve a fraction of this market in a specific niche.

"We are not an ERP solution for every manufacturer," says Chuck Rathmann, a spokesman for IFS North America. "We are kind of a niche player for complex, engineer-to-order manufacturing, asset intensive industry, aerospace and defense and a couple of other verticals."

So, even if the major enterprise solution providers are working on tools to help with the transition, many companies will need time to adjust to new regulations and expectations.

Middle-market companies, especially those doing under $1 billion in revenue, are in a particularly tough position. They simply can't afford the costs of consulting and integration necessary to track environmental metrics.

With only 20 percent of the over 260 mid-size companies in the IFS survey indicating they are tracking their eco-footprint, it could be a long process. And what about companies over $1 billion? Only 36 percent say they are currently tracking it.

Few would argue that tracking this stuff isn't important. In fact, 83 percent of those surveyed said it was important. However, the number one reason for that importance was compliance.

The timeline, however, is a different story. Regulators and government officials need to take into account that people can't just flip a switch and make this happen.

But is anyone in Washington or Copenhagen considering the unintended consequences of their decisions on this sector? I doubt it.

In fact, I'd be surprised if any one of these companies has a seat at the table in the global climate summit in Denmark -- they typically aren't heavy on marketing or lobbying budgets. But once again they may be left out in the cold.

Reblog this post [with Zemanta]

07 December 2009

"Hide the Decline" Sends Up ClimateGate

As the Copenhagen Climate talks begin, this video send-up of the ClimateGate issue came across my in box.

Regardless of your position on global warming, you ought to get a chuckle out of this:

Reblog this post [with Zemanta]

05 December 2009

Why I'm Not Going to Copenhagen

Why am I not going to Copenhagen? Because it's a waste of time, money, and CO2.

Seriously. Over the years, these large gatherings of nations, NGOs, scientists, policy brokers, lobbyists, celebrities, and demagogues has continued to spiral into irrelevance in my mind.

The result is always the same: a bunch of hot air, posturing, and agreements to agree to meet again, while everyone scrambles around vying for attention and trying to make their position the leading argument.

Copenhagen promises to be more of the same, and now there will be even more drama with President Obama, fresh from his Nobel Prize acceptance, showing up like Santa Claus bestowing presents to the delegates. Or not.

But the real reason I have no interest in being in Copenhagen next week is that I think the delegates there will be focused on the wrong things.

More than ever, I'm convinced that the climate crisis campaign has given way to climate chaos and that it has led to two very bad trends revealed in the news media of late: the "Climategate" scandal, which reveals some climate scientists behaving badly and the steep decline in public sentiment about whether global warming is really happening.

As I've said elsewhere, I do believe the climate is changing and there is a genuine risk posed by potentially escalating changes. Some of the dangers could be catastrophic, especially for some coastal and island communities or for any community that relies on glacier-fed streams.

The poor and vulnerable may be at the greatest risk, because there is very little safety net for them, but they are often forgotten in the debate.

What I'm not convinced about is whether anyone really knows what extent the changes will be, despite the dire predictions we all hear about and that are often represented as the "consensus" view.

I think it's time for a change in the way we think about global warming and climate change. We need to get beyond the doom-and-gloom hysteria and focus on adapting to a range of changes that will likely happen, investing in innovations that will help adapt and even mitigate some of those changes, and looking for creative ways to help people change their behavior that will facilitate both adaptation and innovation.

That last point is illustrated by The Fun Theory, a web site that was brought to my attention by Kim Larson, who is a leader in bringing healthier food to school children around the country.

The Fun Theory is a program developed by Volkswagen (yes, a car company) "dedicated to the thought that something as simple as fun is the easiest way to change people’s behavior for the better. Be it for yourself, for the environment, or for something entirely different, the only thing that matters is that its change for the better."

How much better Copenhagen would be better if it was about creating fun, innovative ways of reducing CO2 rather than prescriptions.

But it won't happen; so I'll stay home next week.

Reblog this post [with Zemanta]

01 December 2009

Mulling Over ClimateGate

"It's Sunday evening, I've worked all weekend, and just when I thought it was done I'm hitting yet another problem that's based on the hopeless state of our databases. There is no uniform data integrity. ..."

That quote comes from the log of a computer modeler known as HARRY_READ_ME, which documents a struggle to make sense of a database of historical temperatures. The log, along with emails from prominent climate researchers, is at the center of the "ClimateGate" controversy.

Depending upon your point of view, hacked computers at the University of East Anglia's Climate Research Unit reveal either a pattern of deceit, cover-up, and double-dealing or a bunch of grumpy, insular scientists frustrated by distractions to their multimillion dollar research, such as answering climate skeptics or exposing their data to public scrutiny.

Whichever side you're on, you've got to admit this stuff is brilliant.

And while climate skeptics have seized on these emails as the work of "a priesthood protecting the temple from barbarians," as John Tierney put it in the New York Times, others have tried to dismiss it as irrelevant to the UN's advice on global warming.

Bret Stephens, writing in the Wall Street Journal, suggests we "follow the money," positing that an entire industry has grown up around proving the validity of the global warming data and its attendant economic ecosystem.

"Why did the money pour in so quickly?" Stephens asks. "Because the climate alarm kept ringing so loudly: The louder the alarm, the greater the sums. And who better to ring it than people like Mr. Jones, one of its likeliest beneficiaries?"

The "Mr. Jones" to whom Mr. Stephens refers is Phil Jones, a climate researcher whose emails initiated the controversy. In one email he refers to a "trick" he applied to raw data to "hide the decline" in global temperatures. He and others may even have lobbied for the firing of a journal editor who published papers questioning scientific consensus on global warming.

These are the kinds of mean-spirited, dirty tricks that were once associated with the Bush Administration. Remember the hew and cry over former Chief of Staff of the White House Council on Environmental Quality Phillip Cooney's tampering with scientific reports to minimize the anthropogenic connection to climate change?

It just shows that no one is averse to cajoling, tricking or brow-beating to get their point across and win the mindshare game. Does it damage their credibility? It sure does. I thought scientists were supposed to be above politics and positioning, and held themselves to a higher standard.

Don't get me wrong. I do believe climate change is happening. I've seen the results in my back yard and places as far away as India and Indonesia. I'm just not sure that the predictions of doom-and-gloom and disaster deserve to be considered without challenging the assumptions that go into making them.

After all, aren't computer models only as good as the data that goes into them?

These emails call into question the validity of assertions that the global warming hypothesis has been proved. Is it not, despite the concordance of a wide array of climate scientists, still only a hypothesis?

The question remains why did the scientists feel compelled to manipulate raw data in order to prove what they wanted to prove rather than defend their assertion that short-term fluctuations have little relevance in the face of long-term trends?

One solution to all of this has been suggested by Judith Curry, a specialist in climate-hurricane interactions at Georgia Tech, writing on Stephen McIntyre's Climate Audit site.

Dr. Curry identifies "two broader issues raised by these emails that are impeding the public credibility of climate research: lack of transparency in climate data, and 'tribalism' in some segments of the climate research community that is impeding peer review and the assessment process."

Hers is a cogent and sober set of recommendations and I applaud her openness and willingness to engage both sides in that forum. She ends her post by calling for the "climate research enterprise" to adapt to the "need for public credibility and transparency" in the wake of the increasing "policy relevance of climate research."

Let's hope this is the beginning of a new chapter where reasonable dialogue and common sense -- and scientific method -- prevail.

27 November 2009

The Trouble with Cap and Trade

SUN VALLEY, CA - DECEMBER 11:  The Department ...Image by Getty Images via Daylife

On Tuesday, the State of California announced its plans for its own cap-and-trade program as part of Assembly Bill 32, which aims to cut Greenhouse Gas Emissions 15 percent by 2020.

The California Environmental Protection Agency's Air Resources Board released its scoping plan, which was praised by governor Schwarzenegger, environmentalists, and utilities.

But is all the praise deserved?

The California plan follows the same outline of other such plans: a cap limits the amount of GHG emitted by power plants, refineries, cement factories and the like, and requires a permit for every ton of CO2 released into the atmosphere.

The trouble with a California program -- or a Western States Program or a Regional Greenhouse Gas Initiative like we have in the Northeast -- is that it's a patchwork approach.

If you're a company with a national footprint, you have to react to all sorts of different regulations, that's why some companies want a national program.

Yet even a national cap-and-trade program is a flawed scheme for dealing with CO2 emissions. Despite the prevailing sentiment that cap-and-trade is market-based, most of the proposed programs will hand out a significant portion of the permits for free, which could have the unintended consequence of keeping the price of permits lower than desirable.

The EPA estimates that the average price per ton will be around $15 for possibly the next two decades. That's until 2030 folks.

Some analysts say that utilities need a carbon price of $50/ton before they'll commit the billions needed for new technologies, such as carbon capture and storage and alternative energy resources. When will we get to a $50 price for carbon? When it's too late.

At that rate, the price of carbon won't be enough to create incentives for investments in low-carbon energy infrastructure, energy efficiency, and transportation.

The potential for gaming the system is equally troubling. There is little agreement about monitoring and accounting of the permits and projects that qualify, which could provide an avenue for unscrupulous speculators to take advantage of the situation.

A cap-and-trade program potentially creates windfall profits for utilities, but it is unclear whether it will generate significant reductions in emissions or investments in clean technology.

And some analysts think it is doubtful that cap-and-trade will even put a dent in fossil fuel's price advantage. Others fear that much of the transactional value of the assets created by any cap-and-trade program will be in the hands of some of the same folks who gave us the subprime mortgage and credit default debacles.

Finally, if we are going to have a cap, and that seems to be the way it's going, I'd rather see a cap-and-invest structure where you auction of the permits to the highest bidder and use profits to create an R & D investment fund rather than giving the permits away for free.

It seems to me these flaws need to be addressed in any scheme that gets adopted before we head down the road of future regrets.

Reblog this post [with Zemanta]

25 November 2009

The Green Skeptic on Fox Business: On Copenhagen, ClimateGate and Falling Polar Bears

Today I appeared on Fox Business speaking with Stuart Varney about ClimateGate, Copenhagen, and a horrible television commercial that shows polar bears falling out of the sky.

Here it is:

Reblog this post [with Zemanta]

24 November 2009

Still Skeptical After All These (5) Years

Today marks the 5th Anniversary of "the green skeptic." The blog, if not the person.

People often ask me why I'm skeptical and what I'm skeptical about.

Well, the answer is, I believe that skepticism is a hallmark of human nature. Without it, we are sheep.

I think we need to constantly challenge our assumptions about the way the world works or how others tell us it works. We must question even what our leaders tell us, regardless of what side of the aisle their derriere rests upon or what side of the issue they claim to represent.

As the recent controversy around emails sent by and among climate scientists reveals: we are none of us -- left, right or center -- averse to cajoling, tricking or brow-beating to get our point across and win the minds of others.

So, I'll remain a skeptic and try to stop the bleating where I can.

20 November 2009

Philly's Startup Phinest Rock at Founder Factory

WXPN's World Cafe Live regularly features rock bands, but on one day in November, Philly Startup Leaders' Founder Factory gives entrepreneurs, from earnest beginners to successful experts, the chance to be the rock stars.

The small stage and close proximity of the audience makes for an intimate setting, differentiating it from the large, cold and poorly lit venues that usually host company showcases.

For the experts who have made it -- as entrepreneurs, investors or both -- Founder Factory provides a chance to regenerate the entrepreneurial ecosystem. The experts share stories, impart wisdom, and lend an objective ear in "Fishbowl" problem-solving sessions with young startups.

For the startups, it's a chance to meet other like-minded entrepreneurs, receive advice that would cost thousands if they had to pay for it, and maybe even find an investor or adviser.

And for the audience, many of whom are entrepreneurs working on their own ideas, they benefit from hearing the types of questions facing young companies and those asked by investors and others who may be in a position to lend a hand to them some day.

This year's speakers included Doug Alexander of Internet Capital Group. Doug has seen it all over almost 30 years as an investor and entrepreneur. He offered an investor's perspective on what it takes to build a successful company.

Success may be determined by how a startup answers a few essential questions, Alexander noted: 1.) Are you solving a problem that is keeping someone up at night? 2.) How are you going to make money? and 3.) What is your go-to-market strategy?

Dr. Jeremy Siegel, the Russell E. Palmer Professor of Finance at the Wharton School, arrived with some good news on the economic front. He analyzed everything from the relative value of the dollar to what level of inflation our economy can handle (3-4 percent, in his view), and even criticized former Fed Chairman Alan Greenpsan for not foreseeing the collapse of the credit markets due to highly leveraged credit default swaps.

"Greenspan saw the balance sheets," Professor Siegel said. "He could have told us to watch out." Siegel's bullish optimism on the resilience of our economy was well received.

The sold-out crowd of 200-250 people also heard from Alan Kraus of Ben Franklin Technology Partners Geoff Cook of myyearbook.com and David Brussin of Monetate.

The Fishbowl companies this year were Revzilla, an ecommerce site for motorsports enthusiasts, mobile language learning system PlaySay, and Kidzillions, an allowance and chore rewards platform that lets kids spend and save their money online.

Kendra Gaeta, founder and CEO of Kidzillions stole the show when she demonstrated the art of winging it during her presentation. Her team did not make it due to car trouble on the Turnpike and then her PowerPoint couldn't load. With a sigh of resolve, Gaeta plowed ahead, impressing both the Fishbowl panel and the audience.

The sophomore outing of Founder Factory was not without kinks: some of the presenters need to sharpen their presentation skills and focus on the story rather than every technical issue they wrestled with in establishing their business.

I'd also like to see some cleantech representation in the program next year, either as presenters or Fishbowl companies. There were several interesting cleantech companies in the audience this year, so perhaps one will hit the PSL radar.

And the program would benefit from having a "where are they now?" session recapping what happened with last year's Fishbowl companies and what they learned after Founder Factory.

In the end, Founder Factory is a good reminder that celebrating the entrepreneur can lead to inspiration and value creation. More than one entrepreneur in the audience with whom I spoke shared that Founder Factory helped them renew the spark that got them excited about starting a business in the first place.

And perhaps one of those startups will one day be invited back as an expert imparting his or her wisdom to the next generation of entrepreneurs.

Reblog this post [with Zemanta]

17 November 2009

Global Entrepreneurship Week: "Unleash Your Ideas"

The 2nd annual Global Entrepreneurship Week was launched yesterday:

"From November 16-22, Global Entrepreneurship Week (GEW) will connect young people everywhere through local, national, and global activities designed to help them explore their potential as self-starters and innovators. Students, educators, entrepreneurs, business leaders, employees, non-profit leaders, government officials and many others will participate in a range of activities, from online to face-to-face, and from large-scale competitions and events to intimate networking gatherings."

GEW has four goals (from their web site):

* Inspire. We introduce entrepreneurship to young people under the age of thirty who otherwise might not have considered it as a career path.
* Connect. We network young people and organisations across national boundaries to discover new ideas at the intersection of cultures and disciplines.
* Mentor. We enlist active and inspiring entrepreneurs around the world to coach and mentor the next generation of enterprise talent as they pursue their dreams.
* Engage. We demonstrate to opinion leaders and policymakers how entrepreneurship is central to a nation's economic health and culture, and give them the opportunity to learn about each other's entrepreneurial policies and practices.

Pretty cool goals, if you ask me.

Here's a 5-minute video about Global Entrepreneurship Week:

Of particular interest to readers of the green skeptic is the Global Cleantech Open competition, which solicited ideas from around the world, "anything from revolutionary ways to generate clean energy, to better ways to filter water, to ideas about how governmental policies around climate change can foster new businesses."

Winners will be announced tonight at a gala reception in San Francisco: Gala

There are many events around the world marking Global Entrepreneurship Week, and other events that are happening coincidentally, such a Philly Startup Leaders' 2nd annual Founder Factory, which takes place on Thursday, November 19th at World Cafe Live.

The Founder Factory was created by Philly Startup Leaders to help foster growth of an ecosystem of entrepreneurs, mentors, angels, VCs, students, schools, and government groups in the Philadelphia area.

This week it's all about unleashing ideas.

Reblog this post [with Zemanta]

12 November 2009

REDD Ain't the New Black: 10 Concerns About Paying Countries for Forest Protection

Jungle burned for agriculture in southern Mexico.Image via Wikipedia

I was asked the other day why I think the UN's Reducing Emissions from Deforestation in Developing Countries (REDD) is a flawed, if not bad idea.

Here are 10 concerns I have about the REDD scheme:

1.) I've said it before, but will say it again: Entrusting governments to protect their forests in light of competing interests of growth, feeding hungry, and poverty reduction is very risky.

2.) We can't ensure that forest protection won't lead to shutting out the interests of local people and lining the pockets of corrupt government officials, corporations, or even NGOs. Better to trust the local community to manage their forest assets -- or at the very least, make sure they have a seat at the table.

3.) Underdeveloped monitoring and accounting could lead to unscrupulous speculation and gaming the system. How can we protect against the Bernie Madoff of the carbon market or the Enron of global forest protection? (And don't forget organized crime: Interpol, the world's leading policing agency, raised concerns in early October that chances were very high criminal gangs could take advantage of REDD schemes, according to an article in the Guardian.)

4.) We need to raise standards of living by valuing and maintaining natural capital not converting it and not, necessarily, setting it aside. And we need to ensure that the local communities have more influence and power over how their resources are managed for the multiple uses they require for access to pathways out of poverty.

5.) Right now REDD is only about reducing emissions: the money goes to those nations with high rates of deforestation. This could lead to perverse incentives or unintended consequences. If a nation has a low deforestation rate, they can't participate. What's to stop them from thinking, "Hey, if I accelerate my deforestation rate, I'll get paid to stop..."

6.) We need market mechanisms to drive protection. People won't protect it if there is no money in it, especially when cutting it down pays. We need to put a dollar value on the services forests provide: watershed protection, stabilizing soils, flood protection, as well as generating rainfall, storing carbon, and moderating the climate. What is that worth? Nicholas Stern suggested a $15B market value – that's a pittance compared to global insurance business of $3T -- a relatively cheap insurance policy.

7.) Could creating forest bonds, insurance products or user-fee water funds be tied to the ecosystem services provided by forests, ensuring that such things as agricultural productivity or water supplies linked to rainfall coming out of forests? (Some conservation groups have tried this, such as The Nature Conservancy's Water Funds in Ecuador.)

8.) We need an investment grading system for countries that participate in schemes like REDD: Those with good governance, clear land title law, and high forest protection receive AAA rating; those with high levels of corruption, conflict, and high deforestation are relegated to subprime. (This has been suggested by others, but I don't think it has been implemented.)

9.) I've said this before, too: Philanthropy and government taxes are not going to be able to protect the world's forest assets – you need viable market mechanisms and the will to unleash the entrepreneurial spirit of the people who depend upon the forests.

10.) The solutions must be market-based: If someone is getting paid $5 to cut down a tree, you're going to have to pay him $6 to leave it there; if you can pay him $10 to not cut and make some money off a related product or service, even better. We need to figure out how to make that happen and ensure there are proper financial incentives for the 1.6B people who depend upon forests for water, food, and livelihoods.

To date, rich countries have put up $52M to establish nine UN-sanctioned REDD pilot schemes in Asia, Latin America, and Africa -- and private schemes are forming through a consortia of banks, conservation groups, and other businesses.

I just don't think handing out what essentially amounts to aid to developing countries is the right solution. I do hope the Copenhagen delegates consider the unintended consequences of their bold actions. (Remember the food vs. fuel issue created by jumping on the ethanol bandwagon!)

REDD ain't the new black, at least not to this green skeptic.

Reblog this post [with Zemanta]

06 November 2009

"What Keeps You Up at Night?"

Lou Rappaport of Blank Rome asked me a disturbing question the other day at the MAC Alliance Conference in Philadelphia.

On the face of it, Lou's question was a simple one:

"What keeps you up at night?"

We were interrupted before I could answer, but Lou's question lingered with me.

In fact, it kept me up the past couple of nights.

By way of an answer now, here are seven things that keep me up at night:

1.) We will fail to embrace change and tackle the new green economy.

2.) We are so deeply entrenched in partisan politics that we will blow this opportunity to lead in a sector (alternative energy) that we invented.

3.) The Dems have made climate and energy a "left" issue and the right has ceded it to them. Where is the GOP leadership stepping up to fill the McCain void on these issues?*

4.) Enviros and NIMBYs will kill the energy economy transformation by blocking efforts on clean coal, nuclear, natural gas exploration, and the new electric grid just as they did with wind farms and offshore drilling.

5.) We don't have time to dither, yet we are a nation of inveterate ditherers.

6.) While we dither and dawdle, China is ready to seize the day.

7.) I don't know Mandarin.

*(Note: This is deeply disappointing for the party of Teddy Roosevelt and Richard Nixon, which once led on issues now considered clean and green – and that now seems blind to this incredible opportunity for wealth generation.)

05 November 2009

MAC Alliance: Promise of Clean Tech in Region

Day Two of the 2009 Mid-Atlantic Capital Alliance Conference this week featured the first clean tech track in the history of the conference, an indication that the sector is emerging in this region.

The clean tech track opened with a "financing panel," a good mix of investors, analysts, and utility service companies, including the publicly traded demand-response play Comverge and PJM, which operates the largest regional electricity transmission grid in the country.

Rob Day, a partner at the venture capital firm Black Coral Capital, came down from Boston, and Tucker Twitmyer of local heroes EnerTech Capital offered the investor perspective, along with John Roy, an energy analyst from Janney Montgomery Scott.

Day opened the session with a humorous take on the myths of clean tech in the US.

"If you read national media or the New York Times," Day opined. "You know that the only good clean tech is happening in Silicon Valley -- and it's only solar, wind, and cars. You also know that it is a capital-intensive business that is only for whiz-bang PhDs, and has nothing to do with service providers or implementers."

After letting the audience in on the joke, Day countered that, in fact, "What we're seeing is a growing awareness of clean tech innovation around the country. Real value chains are emerging here in the Mid-Atlantic region and up and down the east coast, not just the left coast."

Twitmyer agreed, suggesting that the "trend is positive for clean tech: there will be fundamental changes in our energy infrastructure; some chosen, some forced. Carbon will be priced in."

With Comverge and PJM at the table, the talk turned to demand-response and systems that will monitor and control energy assets. The panel could not come to agreement about who will benefit more: central generators and the utility industry or distributed generation resources.

But all agreed that subsidizing the advanced metering infrastructure (AMI) and smart grid, will enable a range of ancillary energy assets: transportation, reserves, storage; indeed, the entire enabling infrastructure stands to benefit.

As with everything in this sector, however, it will come down to price. (What isn't about price?)

How is the Mid-Atlantic region positioned for clean tech development? The panelists agreed it is well positioned.

"But it isn't really about one region or state over another, " John Ray of Janney reminded the audience. "It is really the US against the rest of the world -- and we have some catching up to do."

My three take-aways from the 2009 MAC Alliance Conference, especially the clean tech track:

1.) The Mid-Atlantic region has great potential, but is competing globally;
2.) We need to keep up the momentum presented by events like this and the REBN events we've held over the past year;
3.) We need more clean tech investors in the region and need to build on existing assets to attract more investors and companies.

(Eleven companies also presented at the conference. I'll write about a few of them in a future post.)

04 November 2009

Mark Zandi to MAC Conference: "The Great Recession is Over"

Mark ZandiImage by New America Foundation via Flickr

"The Great Recession is over," Mark Zandi, founder and chief economist of Moody's Economy.com, told a crowd of investors, entrepreneurs, and others gathered at the 2009 Mid-Atlantic Capital Alliance Conference in its opening keynote Tuesday.

"In fact, it ended on August 23rd," Zandi quipped. "If you want to know the precise time, you have to buy my book."

Zandi was referring to Financial Shock, his new book about the subprime crisis.

"It was no accident that the recession ended just as the stimulus kicked in," Zandi related. "The maximum impact was felt just when the maximum contribution was made: 3Q of this year."

And that's not a bad thing, Zandi said. In fact, this former economic advisor to GOP presidential candidate John McCain said he hopes that policymakers will be more aggressive in trying to rise the tide.

"The policy response was aggressive, but it needed to be," said Zandi. "Now they need to do more."

He cautioned that "recovery will be a bit of a slaw." (I first thought he said "slog," but then he repeated "slaw," by which I think he meant a salad of mixed bag.)

The foreclosure crisis will continue and we'll start to see it hit the commercial real estate market soon, according to Zandi, perhaps by the second quarter of next year.

Zandi wasn't all doom-and-gloom and tried to reassure the crowd gathered in the grand ballroom at the Pennsylvania Convention Center in Philadelphia.

This year's conference location was significant, in Zandi's opinion, because the region weathered the recession better than other parts of the country.

In part, this is due to the fact that it didn't have very far to fall, and partly due to relatively stable real estate prices -- especially outside of New York City and Washington, DC -- but also because the region boasts healthy components that are critical to getting out of the recession and building beyond it: health care and education.

"50 year olds are the single largest age group in the US," Zandi remarked. "And they will be sucking up a lot of health care."

The second largest age group? The 20-year-old firstborns of that top group, most of whom are setting out on their secondary and tertiary educational paths. Both education and health care will be engines of growth in the future -- and the future is here.

The MAC Conference is the annual venture capital gathering for the Mid-Atlantic region, which comprises the area between New England and the South, and can include states such as Delaware, Maryland, New Jersey, New York, Pennsylvania, Washington D.C., and sometimes Virginia and West Virginia.

The Conference runs through 4 November, with company presentations and other speakers and panels. (I'll be covering the clean tech track and reporting on it here later.)

For more information, visit the MAC Alliance website.

Reblog this post [with Zemanta]