Green Business Development

by Seleyn De Yarus

THE UNITED NATIONS AND LEADING RESEARCHERS CONCLUDE THAT ORGANIC FARMING IS A VIABLE OPTION FOR GLOBAL FOOD SECURITY, ECONOMIC DEVELOPMENT, AND SUSTAINABILITY.

There are an estimated 6.9 billion humans on planet Earth. Of those, there are an estimated 3 billion people living on less than $2 a day. Access to healthy food, housing, and drinkable water challenges nearly half of our species. However, evidence is mounting that organic agriculture can feed and provide income and sustainability to a growing number of the world’s poor while also ensuring healthier ecosystems and more nutritious food.

A shining example of how organic agriculture provides sustenance on many levels is the Tigray Project in Ethiopia.
Local and national experts have cooperated with farmers in the Tigray region and tapped the rich knowledge of the farmers to understand and utilize local ecosystem elements rather than depend on fertilizers. Tigray has achieved higher yields, higher groundwater levels, better soil fertility, increased household income, and stronger livelihood opportunities for farmers than previous efforts with conventional agriculture. The Ethiopian government has now adopted this approach to mitigate soil damage and alleviate poverty in 165 local districts in the grain producing parts of Ethiopia.

A report showing further evidence that organic farming can feed the world was presented in October 2008 by the United Nations Environmental Program. In a statement to The Independent, the head of the UN’s Environment Program, Achim Steiner, said the report “indicates that the potential contribution of organic farming to feeding the world may be far higher than many had supposed.”

The report analyzed 114 projects in 24 African countries and found that yields had more than doubled where organic or near-organic practices had been used as compared to conventional crops. Additionally, the study found that organic practices provided environmental benefits such as improved soil fertility, better retention of water, and resistance to drought. The research also highlighted the role that organic farming could play in improving in areas such as local education, agro-ecological knowledge, leadership training, adult literacy, computer knowledge and experimental farming programs. The report can be found at www.unep.org.

Out With The Green Revolution, In With The Organic Revolution

The Green Revolution, so named in the 1960s and 1970s, offered a package of hybrid seeds, farm technology, better irrigation techniques, and chemical fertilizers and pesticides. It was successful at meeting its primary objective of increasing crop yields and augmenting aggregate food supplies. Yet, despite its success, the Green Revolution as a development approach has not necessarily translated into benefits for the lower strata of the rural poor in terms of greater food security or greater economic opportunity and well-being.

Research shows that the latest scientific approaches in organic agriculture offer developing countries affordable, immediately usable, and universally accessible ways to improve yields. Rodale Institute is a 60-year-old research and education nonprofit with the longest ongoing comparative agricultural field trials in the world.

“Yield data just by itself makes the case for a focused and persistent move to organic farming systems,” explains Dr. Tim LaSalle, CEO of the Rodale Institute. “When we consider that organic systems are building the health of the soil, sequestering CO2, cleaning up the waterways, and returning more economic yield to the farmer, the argument for an Organic Green Revolution becomes overwhelming. These methods also build the soil, increase drought and flood resistance as well as adaptability to climate change,” LaSalle says.

Remember the high yield goal of the Green Revolution? The quest for maximum yield in conventional agriculture has often resulted in declining nutritional quality, says Dr. Donald Davis of the University of Texas, Austin. He and his team analyzed 50 years of USDA nutrition data. According to a study published in 2004 in the Journal of the American College of Nutrition, 13 major nutrients in fruits and vegetables tracked by USDA from 1950 to 1999, six showed significant declines—protein, calcium, phosphorus, iron, riboflavin, and vitamin C.

Dr. Davis noted that over many years of using yield potential as the dominant criterion in developing improved varieties, while average yields have risen, plant root systems have not been able to keep pace in drawing more needed micronutrients from the soil. When breeders selectively breed for one resource, using a selected trait like yield, fewer resources remain for other plant functions, the study explains.

Organic fruits and vegetables on other hand, are on average 25% higher in 11 key nutrients than their conventional, chemically produced counterparts, according to research published in March 2008 by The Organic Center. Organic fruits and vegetables also are 30% higher in antioxidants when compared to their conventional counterparts. The higher levels of antioxidants in organic food may also contribute to better taste, according to a 2006 Organic Center report.

Both international and national research is substantiating that food security, human health, economic development and ecological sustainability are better served through organic agricultural methods than previously recognized. The increased recognition of the downsides of chemically intensive agriculture combined with the growing body of evidence for the benefits of organic agriculture provides new momentum for more sustainable agricultural practices to be adopted globally. This is good news for the burgeoning populations of the developing world and their local environments.

Seleyn DeYarus is the development director of The Organic Center and has been an advocate of organic farming and ecological sustainability for 25 years. For more information, visit www.organic-center.org.

At a time when the U.S. economy is facing its biggest crisis in decades, clean technology offers the promise to be the next big engine of business and economic growth.

What is clean tech? At Clean Edge, a firm that covers the clean technology market, our definition refers to any product, service, or process that delivers value using limited or zero nonrenewable resources, and/or creates significantly less waste than conventional offerings. Clean technology comprises a diverse range of products and services—from solar power systems to hybrid electric vehicles—that:

• Harness renewable materials and energy sources or reduce the use of natural resources by using them more efficiently and productively
• Cut or eliminate pollution and toxic wastes
• Deliver equal or superior performance compared with conventional offerings

Clean tech covers four main sectors: energy, transportation, water, and materials. It includes relatively well-known technologies such as solar photovoltaic (PV) and concentrated solar power (CSP), wind energy, biofuels, advanced lithiumion batteries, and large-scale reverse-osmosis water desalination. It also includes emerging technologies such as wave and tidal power, silicon-based fuel cells, distributed hydrogen generation, plug-in hybrid and all-electric vehicles, and nanotechnology-based materials.

So how did clean tech go from the stuff of back-to-the-earth utopian dreams to its current revolution among the inner circles of corporate boardrooms, Wall Street trading floors, and government offices around the globe?

We’ve identified six major forces—what we call the six Cs—that are pushing clean tech into the mainstream and driving the rapid growth, expansion, and economic necessity of clean tech across the globe: climate, costs, capital, competition, China, and consumers.

Costs. Perhaps the most powerful force driving today’s clean-tech growth is simple economics. As a medium to longterm trend, clean-energy costs are falling as the costs of fossil fuel energy, despite the drop in the price of oil in the second half of 2008, are going up. The future of clean tech is going to be, in many ways, about scaling up manufacturing and driving down costs. Recent advances in core technology and manufacturing processes have significantly improved performance, reliability, scalability, and cost of clean energy sources, primarily solar and
wind.

By contrast, in conventional fossil-fuel power such as coal and natural gas (which together provide approximately 60% of the world’s electricity), the generating technologies are mature, stable, and already widely deployed—so their technology costs are relatively steady and predictable. What determines the price of conventional power is the cost of fuel—and the price of fossil fuels, while certainly experiencing directional gyrations as we’ve seen in the past year, has nearly always moved in the same general direction over the long term: up.

With solar, wind, small-scale hydroelectric, geothermal, and even the nascent technology of ocean tide and wave generated electricity, the price-determining formula is just the opposite. There is no cost of “fuel”—the sun, the breeze, the heat of the earth, the tides and waves arrive free of charge daily.

Climate. Alarm is growing about the climate-change consequences caused by our continued dependence on carbon-intensive, greenhouse gas (GHG)–emitting energy and transportation sources, and manufacturing processes. The United Nations’ Intergovernmental Panel on Climate Change warned in 2007 that global GHG emissions must be in decline by 2015 to avert disastrous “runaway” climate change. And with insurance giants such as Swiss Re and Munich Re thinking twice about climate impact on the issuance of their policies (try getting an insurance policy for an oil rig in the Gulf of Mexico), the climate issue is coming front and center for companies, governments, and individuals.

This is driving clean-tech investment and deployment and becoming an increasingly important factor in assessing
investment risk factors. Global companies from DuPont to Wal-Mart are investing heavily to promote energy efficiency and clean tech in their operations to reduce their GHG contributions. “As an investor, do you believe that we’re going to take climate change seriously in terms of legislation?” asks Mark Trexler, president of Trexler Climate + Energy Services, a firm in Portland, Oregon, that advises companies and utilities on carbon-reduction strategies. “To completely ignore it, in terms of investment decisions, would be a terrible thing.”

Consumers. Rising energy prices, polluted ecosystems, and growing awareness of climate change and the geopolitical costs associated with fossil fuels are driving a shift in consumer attitudes and consumer demand for clean-tech products and services. That’s forcing companies that sell to consumers – from appliance makers to auto manufacturers to Wal-Mart – to produce and sell cleaner, more efficient products and to market them aggressively.

Who is driving this demand and growth, which is also evidenced by the steady expansion of the LOHAS demographic sector? Both early adopters, who installed the first solar PV system in their neighborhood or purchased an early-model Toyota Prius, and mainstream customers, who are installing high-efficiency water heaters, buying higher-mileage cars, insulating their homes with recycled denim, and demanding efficient EnergyStar appliances and windows.

These 21st century consumer preferences don’t seem to be slowed by the dramatic drop in gasoline prices that began in the fall of 2008. A Consumer Federation of America survey in February 2009 found that 76 percent of U.S. adults were still concerned about high gas prices and an equal number worried about American dependence on oil from the Middle East.

Capital. An unprecedented influx of capital is changing the clean-tech landscape, with billions of dollars, euros, yen, and yuan pouring in from a myriad of public and private sector sources. Since the 1970s, investments in clean technology have moved from primarily government research and development (R&D) projects to major multinationals, well-heeled venture capitalists, and savvy individual investors.

General Electric, the world’s largest diversified manufacturer, plans to invest up to $1.5 billion a year in clean-tech R&D by 2010 as part of its “Ecomagination” business strategy. Spain-based energy giants Iberdrola and Acciona are both poised to spend billions of dollars building out their clean-energy portfolios, primarily wind power, over the coming years. Toyota reportedly spends some $8 billion annually in R&D, much of it for hybrid and fuel-cell development. Sanyo, the fourth largest solar cell manufacturer in the world behind Sharp, Q-Cells, and Kyocera, has said it will invest $350 million over 5 years to expand its solar operations as well.

The trend is significant. In 2008, despite its fourth-quarter downturn, venture capital investments in clean tech (in North America, Europe, China, and India) grew 38% to $8.4 billion, according to research firm The Cleantech Group in San Francisco.

China. Clean tech is being driven by the inexorable demands being placed on the earth not only by mature economies but also China, India, Brazil, Russia, and other rapidly developing nations. Their expanding energy needs are driving major growth in clean-energy, transportation, building, and water-delivery technologies.

China is emblematic of the resource-constraint issues facing our planet; China will not be able to sustain its growth if it doesn’t widely embrace clean technology. The Chinese government is starting to understand this and in 2006 committed to investing more than $200 billion over 15 years to meet nationally mandated targets for clean energy. China is planning to have 60 gigawatts of renewable energy (not including large hydroelectric) by 2010 and 120 GW by 2020.

Competition. This refers to competition among cities, regions, and nations to attract and grow clean tech as a core industry for job creation and economic development. Thrust into the national spotlight in the past year with the focus on “green jobs” as a major component of U.S. economic recovery, clean tech as a development tool is gaining significant traction. Whether promoting the retraining of laid-off steelworkers to build wind turbines or employing inner-city job seekers to weatherize homes in their neighborhoods, more governments are seeking (and seeing) the benefits of clean tech-focused development efforts.

These powerful global forces—the six Cs—have put clean tech onto center stage and awakened a diverse range of stakeholders across the world. From Beijing to Berlin, from San Francisco to Bangalore, the clean tech revolution is well under way. It will determine which regions lead and prosper and which regions are left drowning in their own effluents, choking on their own emissions, and struggling to compete in a world that is leaner, greener, and less reliant on fossil fuels.

We believe the choice for investors, companies, governments, and individuals is simple, especially as we seek a dramatic transition out of our current financial crisis. Be part of one of the greatest business and economic shifts in recorded human history, or become extinct like the dinosaurs whose fossils fueled the last great industrial revolution.