Sunday, 22 March 2009
Ashwoods LPG vans
Car drivers who want to go green can buy electric, hybrid or biofuel-powered vehicles straight from the manufacturers, but van drivers have no such off-the-shelf option – which is why Ashwoods of Fulham in London (ashwoods.org) converts commercial vans to run on liquefied petroleum gas. LPG is a byproduct of the oil and gas industry and is both a cheaper and a more efficient energy source than petrol or diesel.Ashwoods claims that its LPG vans achieve fuel cost savings of about 40%. Such vans are also exempt from London’s congestion charge, which could save a company up to £2,000 a year on each vehicle. A converted Ford Transit would cost £14,555, or 20% less than the list price. LPG is on sale at more than 1,200 refuelling stations around the country.Ashwoods is also developing a hybrid drive, which it believes will reduce carbon-dioxide emissions by more than 14%. The drive will come in two parts – a system that recovers energy lost during braking plus an electric engine – and can be fitted in less than three hours to many popular van models. The company hopes to start offering the conversion kit at a cost of about £3,000 later this year.greenideas@sunday-times.co.uk
Why the sun is sinking for ethical investors
Funds that target recycling and sustainable energy companies are suffering heavier losses than their more traditional rivals, writes Harriet Meyer
Harriet Meyer
The Observer, Sunday 22 March 2009
Ethical investors who pick green investment funds in an effort to balance profits with protecting the environment are suffering heavier losses than their counterparts in ordinary funds. Hit by exposure to smaller companies pummelled by the stockmarkets and unable to rely on ballast from the recession-proof tobacco and drug giants, those prepared to put their money where their mouth is have come unstuck.
The typical green fund that might invest in a mix of "clean" industries, recycling operators and suppliers of sustainable energy such as solar and wind power, slumped by nearly a third over the 12 months to the end of February, according to figures from financial analyst Moneyfacts.co.uk. The 30% fall compares with an average decline of 25% for non-ethical funds.
Similarly, over the past three years to the close of last month, £1,000 in an ethical fund would have seen you lose an average £269 compared with a loss of £218 if you'd placed your cash in a non-ethical investment fund. Over the same period, the FTSE 100 fell by some 34%.
"The big downside to ethical funds is that they [often] exclude defensive stocks, such as pharmaceuticals, certain commodities and tobacco," says Darius McDermott of IFA Chelsea Financial Services, and these are some of the strongest performers.
When a country enters recession, the stockmarket sees mid-sized and small companies marked down the most because of their higher susceptibility to going under, says Lee Coates, director of the Ethical Investors Group (EIG).
"As renewable energy and green companies tend to be smaller and ethical funds tend to be made up of more of such companies than mainstream funds, so performance may suffer until these companies return to profitability."
But that's not all: a number of large, mainstream companies that had managed to tick all the boxes for good governance in the past have also imploded.
For example, former banking giant HBOS previously scored well with ethical investors - but that didn't stop it, or other banks, from taking huge risks on the money markets and ending up being bailed out by the taxpayer.
"A lot of ethical funds include banks in their portfolios, which has partly led to their poor performance," says Richard Eagling of Moneyfacts. "So people are digging deep into ethical funds to ensure they're only exposed to the companies they want."
Plenty of ethical investors will have also been hurt by their habit of sticking with their funds for longer than ordinary investors who are happier to switch to a better-performing rival fund.
A key characteristic of people who invest in ethical funds is that they are more "sticky", says Mark Robertson from the Ethical Investment Research Service (EIRIS), because they pick their investment in accordance with their principles so are less likely to run for cover due to volatility in the market.
However, with many resigned to the detrimental impact of recession on investments, dipping a tentative toe into a stockmarket in the doldrums can be a good move, says Gavin Haynes, investment director at independent financial adviser Whitechurch Securities. "It's time to start searching through the wreckage for value," he says.
And you may be keen to shun more traditional stocks in favour of those that have the potential to do well by doing good. There are numerous "ethical funds" that back good causes, with around 95 environmentally and ethically screened funds worth more than £8bn, according to EIRIS.
When it comes to picking a fund, it is up to you to first decide just how "green" you want to be and whether certain areas, such as animal testing and arms manufacture, are justifiable.
"You've got to match your individual beliefs with the funds," says Eagling. "You may be bothered about gambling companies, for example, but not so much about those that produce alcohol. You're considering what you're happy to invest in and then seeing what choice you've got."
Coates at EIG says his clients complete a questionnaire so he understands which conviction has driven their interest in ethical investment. "One extreme we've had, for example, is somebody who was a strict vegan and wanted to avoid all companies involved in meat transport, animal testing and battery farming, but they were happy to invest in alcohol, gambling and human rights abuse."
There remain stellar funds that show strong long-term performance. Funds that have proved popular among financial advisers include Jupiter Ecology, F&C Stewardship Income fund - the oldest ethical fund - and Aegon's Ethical Equity.
Eagling also recommends CIS Sustainable Leaders. "It consistently performs well, trying to find companies that are leaders in sustainable industries," he says. For people seeking a fund with a particularly stringent screening process in place, he suggests Aegon Ethical Equity.
The Jupiter fund, favoured by Ben Yearsley at IFA Hargreaves Lansdown, has risen by 28.6% over five years. "Once an investor has narrowed down the list of funds to those fitting their criteria, they should look at the manager and their track record for performance," he says.
In spite of recent poor performance, ethical funds should perform well over the long term, says McDermott, as they are looking at companies that are, in most cases, sustainable businesses that have growth prospects.
His view is shared by Janet Rawlings, project manager for a green business park, from Chepstow. She has invested about £55,000 across six of the most popular ethical funds: Jupiter Ecology, Aegon Ethical Equity, Aberdeen Ethical World Income, Standard Life Ethical, Aviva Sustainable Future and F&C Stewardship Income.
"I invested in these in the mid-1990s, and drip-fed money into them over a few years," she says. "I chose these funds as I strongly believe that we have to take responsibility for our actions, so I try to shop and save ethically."
While the value of her ethical investments has plummeted in recent years, she remains confident these funds will perform well over the long term. "They are not sinking any more than the rest of the market, and avoid investing in dodgy practices such as sub-prime mortgages, but lean towards technologies for the future such as renewable energy and companies with good ethical policies."
• EIRIS has developed an Ethical Funds Directory that can be downloaded from www.eiris.org
Harriet Meyer
The Observer, Sunday 22 March 2009
Ethical investors who pick green investment funds in an effort to balance profits with protecting the environment are suffering heavier losses than their counterparts in ordinary funds. Hit by exposure to smaller companies pummelled by the stockmarkets and unable to rely on ballast from the recession-proof tobacco and drug giants, those prepared to put their money where their mouth is have come unstuck.
The typical green fund that might invest in a mix of "clean" industries, recycling operators and suppliers of sustainable energy such as solar and wind power, slumped by nearly a third over the 12 months to the end of February, according to figures from financial analyst Moneyfacts.co.uk. The 30% fall compares with an average decline of 25% for non-ethical funds.
Similarly, over the past three years to the close of last month, £1,000 in an ethical fund would have seen you lose an average £269 compared with a loss of £218 if you'd placed your cash in a non-ethical investment fund. Over the same period, the FTSE 100 fell by some 34%.
"The big downside to ethical funds is that they [often] exclude defensive stocks, such as pharmaceuticals, certain commodities and tobacco," says Darius McDermott of IFA Chelsea Financial Services, and these are some of the strongest performers.
When a country enters recession, the stockmarket sees mid-sized and small companies marked down the most because of their higher susceptibility to going under, says Lee Coates, director of the Ethical Investors Group (EIG).
"As renewable energy and green companies tend to be smaller and ethical funds tend to be made up of more of such companies than mainstream funds, so performance may suffer until these companies return to profitability."
But that's not all: a number of large, mainstream companies that had managed to tick all the boxes for good governance in the past have also imploded.
For example, former banking giant HBOS previously scored well with ethical investors - but that didn't stop it, or other banks, from taking huge risks on the money markets and ending up being bailed out by the taxpayer.
"A lot of ethical funds include banks in their portfolios, which has partly led to their poor performance," says Richard Eagling of Moneyfacts. "So people are digging deep into ethical funds to ensure they're only exposed to the companies they want."
Plenty of ethical investors will have also been hurt by their habit of sticking with their funds for longer than ordinary investors who are happier to switch to a better-performing rival fund.
A key characteristic of people who invest in ethical funds is that they are more "sticky", says Mark Robertson from the Ethical Investment Research Service (EIRIS), because they pick their investment in accordance with their principles so are less likely to run for cover due to volatility in the market.
However, with many resigned to the detrimental impact of recession on investments, dipping a tentative toe into a stockmarket in the doldrums can be a good move, says Gavin Haynes, investment director at independent financial adviser Whitechurch Securities. "It's time to start searching through the wreckage for value," he says.
And you may be keen to shun more traditional stocks in favour of those that have the potential to do well by doing good. There are numerous "ethical funds" that back good causes, with around 95 environmentally and ethically screened funds worth more than £8bn, according to EIRIS.
When it comes to picking a fund, it is up to you to first decide just how "green" you want to be and whether certain areas, such as animal testing and arms manufacture, are justifiable.
"You've got to match your individual beliefs with the funds," says Eagling. "You may be bothered about gambling companies, for example, but not so much about those that produce alcohol. You're considering what you're happy to invest in and then seeing what choice you've got."
Coates at EIG says his clients complete a questionnaire so he understands which conviction has driven their interest in ethical investment. "One extreme we've had, for example, is somebody who was a strict vegan and wanted to avoid all companies involved in meat transport, animal testing and battery farming, but they were happy to invest in alcohol, gambling and human rights abuse."
There remain stellar funds that show strong long-term performance. Funds that have proved popular among financial advisers include Jupiter Ecology, F&C Stewardship Income fund - the oldest ethical fund - and Aegon's Ethical Equity.
Eagling also recommends CIS Sustainable Leaders. "It consistently performs well, trying to find companies that are leaders in sustainable industries," he says. For people seeking a fund with a particularly stringent screening process in place, he suggests Aegon Ethical Equity.
The Jupiter fund, favoured by Ben Yearsley at IFA Hargreaves Lansdown, has risen by 28.6% over five years. "Once an investor has narrowed down the list of funds to those fitting their criteria, they should look at the manager and their track record for performance," he says.
In spite of recent poor performance, ethical funds should perform well over the long term, says McDermott, as they are looking at companies that are, in most cases, sustainable businesses that have growth prospects.
His view is shared by Janet Rawlings, project manager for a green business park, from Chepstow. She has invested about £55,000 across six of the most popular ethical funds: Jupiter Ecology, Aegon Ethical Equity, Aberdeen Ethical World Income, Standard Life Ethical, Aviva Sustainable Future and F&C Stewardship Income.
"I invested in these in the mid-1990s, and drip-fed money into them over a few years," she says. "I chose these funds as I strongly believe that we have to take responsibility for our actions, so I try to shop and save ethically."
While the value of her ethical investments has plummeted in recent years, she remains confident these funds will perform well over the long term. "They are not sinking any more than the rest of the market, and avoid investing in dodgy practices such as sub-prime mortgages, but lean towards technologies for the future such as renewable energy and companies with good ethical policies."
• EIRIS has developed an Ethical Funds Directory that can be downloaded from www.eiris.org
Wool comes back as the cool new packing material
The Sunday Times
March 22, 2009
Polystyrene will become a thing of the past if the founder of Woolcool has her way
Andrew Stone
GREEN PIONEERS: Angela Morris
WOOL is supposed to keep things warm, but for Angela Morris it is doing the opposite. The founder of Woolcool has developed a way to use nature’s best insulation material to create eco-friendy packaging that is more effective than plastics at keeping heat out.
Woolcool already has some high-profile customers, including River Cottage, the organic-food firm owned by Hugh Fearnley-Whittingstall, as well as the National Trust and Daylesford Organics.
She claims that her material could one day replace polystyrene and polyethylene as the packaging used to transport and store many perishables, such as fresh food.
“It actually performs better “Health and safety guidelines call for it to keep food at 5C for 24 hours and Woolcool can double that.
“Now we are working on ways to improve the design, making the packing lighter and more cost effective.”
By using 100% wool packing inside cardboard boxes, every element of the food boxes can be recycled, composted in the garden or reused. “It is also completely sustainable,” said Morris. “There are 22m shearable sheep in this country and they grow new fleeces every year.”
Woolcool’s sales are growing strongly from £150,000 in the first year to a projected £250,000 this year, and Morris thinks the product has the potential to reach sales of millions of pounds. But for such an expansion she would need to raise more funds, and this could be a problem. “The banks have been terrible lately,” she said. “Working capital has been a big issue holding back our growth and product development.”
Morris maintains that the trend towards greener products could help to take Woolcool into the mainstream. “It's not just about the financial bottom line anymore. Woolcool is much less costly in environmental terms and such things may well be reflected in the price of polystyrene one day. Local councils are increasingly reluctant to take it as waste.
“The plastic industry is very clever at presenting its packaging as somehow green and reusable, but it gives off toxic gases even while you are storing it and it never breaks down. It is also highly flammable and it is much bulkier to transport and store.
“Woolcool takes up a third of the space of polystyrene and this helps to cut its carbon footprint. And, of course, its totally sustainable – oil is not going to last for ever.”
Morris’s search for more sustainable packaging began in 2005 after the National Trust asked her to create greener boxes to ship the home-delivered chilled food sold by its tenant farmers. Discovering that the only nontoxic alternatives to oil-based packaging did not keep food cold enough, she set about looking for something else.
“I soon realised there was nothing else out there,” said Morris. “It’s understandable the National Trust didn’t want to use polystyrene. The problem with it and other oil-based products is that it’s toxic, it’s bulky to transport and it is not biodegradeable.”
Hearing that wool was being used in loft insulation, she ordered a roll and started experimenting, reshaping the material and putting it into fibreboard bags. “I didn’t really expect much from it but when we did the first temperature tests it performed amazingly well and I realised there might be something in it,” said Morris.
The main problem she faces is price. A Woocool box costs about 50% more than a polystyrene one. “When we start selling much larger quantities we can bring the price down but at the moment it is a premium product,” she said.
March 22, 2009
Polystyrene will become a thing of the past if the founder of Woolcool has her way
Andrew Stone
GREEN PIONEERS: Angela Morris
WOOL is supposed to keep things warm, but for Angela Morris it is doing the opposite. The founder of Woolcool has developed a way to use nature’s best insulation material to create eco-friendy packaging that is more effective than plastics at keeping heat out.
Woolcool already has some high-profile customers, including River Cottage, the organic-food firm owned by Hugh Fearnley-Whittingstall, as well as the National Trust and Daylesford Organics.
She claims that her material could one day replace polystyrene and polyethylene as the packaging used to transport and store many perishables, such as fresh food.
“It actually performs better “Health and safety guidelines call for it to keep food at 5C for 24 hours and Woolcool can double that.
“Now we are working on ways to improve the design, making the packing lighter and more cost effective.”
By using 100% wool packing inside cardboard boxes, every element of the food boxes can be recycled, composted in the garden or reused. “It is also completely sustainable,” said Morris. “There are 22m shearable sheep in this country and they grow new fleeces every year.”
Woolcool’s sales are growing strongly from £150,000 in the first year to a projected £250,000 this year, and Morris thinks the product has the potential to reach sales of millions of pounds. But for such an expansion she would need to raise more funds, and this could be a problem. “The banks have been terrible lately,” she said. “Working capital has been a big issue holding back our growth and product development.”
Morris maintains that the trend towards greener products could help to take Woolcool into the mainstream. “It's not just about the financial bottom line anymore. Woolcool is much less costly in environmental terms and such things may well be reflected in the price of polystyrene one day. Local councils are increasingly reluctant to take it as waste.
“The plastic industry is very clever at presenting its packaging as somehow green and reusable, but it gives off toxic gases even while you are storing it and it never breaks down. It is also highly flammable and it is much bulkier to transport and store.
“Woolcool takes up a third of the space of polystyrene and this helps to cut its carbon footprint. And, of course, its totally sustainable – oil is not going to last for ever.”
Morris’s search for more sustainable packaging began in 2005 after the National Trust asked her to create greener boxes to ship the home-delivered chilled food sold by its tenant farmers. Discovering that the only nontoxic alternatives to oil-based packaging did not keep food cold enough, she set about looking for something else.
“I soon realised there was nothing else out there,” said Morris. “It’s understandable the National Trust didn’t want to use polystyrene. The problem with it and other oil-based products is that it’s toxic, it’s bulky to transport and it is not biodegradeable.”
Hearing that wool was being used in loft insulation, she ordered a roll and started experimenting, reshaping the material and putting it into fibreboard bags. “I didn’t really expect much from it but when we did the first temperature tests it performed amazingly well and I realised there might be something in it,” said Morris.
The main problem she faces is price. A Woocool box costs about 50% more than a polystyrene one. “When we start selling much larger quantities we can bring the price down but at the moment it is a premium product,” she said.
The white weddings turn green
The Sunday Times
March 22, 2009
NEVER mind a white wedding – many couples now want to turn their big day green and Britain’s £5.5 billion wedding industry is cashing in. The average UK wedding costs £21,000 (twice as much as 10 years ago) but, surprisingly, no multinational brand has yet managed to dominate the market – it is served almost exclusively by small businesses.
The greenunion.co.uk website pulls together dozens of such small suppliers, from marquee-hire firms to cakemakers. Another site, eco-friendlyweddings.co.uk, offers links to such things as biodegradable tableware and recycled stationery.
Now couples are able to calculate the environmental footprint of their nuptials with the aim of creating a zero-carbon event.
The online calculator at carbonfund.org/weddings allows planners to input the number of guests, any flights and hotel stays involved, plus car hire and mileage estimates. It then tots up the carbon emissions generated and gives users the option of buying carbon offsets through the website. For an event taking place 75 miles outside of London with 150 guests, some flying, others driving and taking the train, the calculator estimates a carbon footprint of about 20 tons.
Other companies are offering green honeymoons for those who don’t want to undo all the good work they have done on the big day. Go Differently (godifferently.com) offers alternative honeymoons where newlyweds can combine short-term volunteer activities in developing countries, presumably alongside more traditional romantic activities.
March 22, 2009
NEVER mind a white wedding – many couples now want to turn their big day green and Britain’s £5.5 billion wedding industry is cashing in. The average UK wedding costs £21,000 (twice as much as 10 years ago) but, surprisingly, no multinational brand has yet managed to dominate the market – it is served almost exclusively by small businesses.
The greenunion.co.uk website pulls together dozens of such small suppliers, from marquee-hire firms to cakemakers. Another site, eco-friendlyweddings.co.uk, offers links to such things as biodegradable tableware and recycled stationery.
Now couples are able to calculate the environmental footprint of their nuptials with the aim of creating a zero-carbon event.
The online calculator at carbonfund.org/weddings allows planners to input the number of guests, any flights and hotel stays involved, plus car hire and mileage estimates. It then tots up the carbon emissions generated and gives users the option of buying carbon offsets through the website. For an event taking place 75 miles outside of London with 150 guests, some flying, others driving and taking the train, the calculator estimates a carbon footprint of about 20 tons.
Other companies are offering green honeymoons for those who don’t want to undo all the good work they have done on the big day. Go Differently (godifferently.com) offers alternative honeymoons where newlyweds can combine short-term volunteer activities in developing countries, presumably alongside more traditional romantic activities.
Climate-change damage may double cost of insurance
The Sunday Times
March 22, 2009
Weather-related problems have been underestimated by scientists
Tricia Holly Davis
INSURANCE companies are set to raise their estimates for future premiums because of the effects of climate change.
Firms that operate in areas where floods and storms cause a growing amount of damage are likely to see the cost of cover rise by as much as 100% in the next 10 years.
The findings by the Association of British Insurers (ABI) reflect a growing belief in the industry that the consequences of changes in weather patterns have been underestimated.
A report to be published by the ABI this year argues that previous predictions of climate-change damage made in 2005, on which the industry now relies, are too low. “We are concerned that our estimates in our [last] report were too conservative,” said Swenja Surminski at the ABI. “Climate change is likely to have a more severe impact on the future price, affordability and availability of insurance coverage.”
There is a growing sense among scientists that climate-change predictions have been too cautious and that the world faces threats of a different order than was thought even a year ago.
At the Copenhagen climate summit this month, delegates warned that “the worst-case scenario trajectories, or even worse, are being realised”.
Last year was one of the costliest catastrophe years in history. Globally, large-scale events including floods, storms and hurricanes as well as man-made disasters such as explosions or oil and chemical spill-ages, led to economic losses of $269 billion (£186 billion), representing more than a threefold increase from 2007, when losses were $70 billion, and more than five times the losses in 2006, according to a report by Swiss Re, the reinsurer.
The resulting cost to property insurers last year totalled $52 billion. The bulk of this, some $44 billion, was due to natural catastrophes, with storm damage causing the greatest number of claims.
In Europe, the costliest natural catastrophe was Emma, a winter storm that crossed large parts of Europe with wind speeds of up to 95mph, causing insured losses of $1.5 billion and overall losses of $2 billion.
Businesses that have outsourced their production to developing nations such as China and India to save on labour costs may be the hardest hit by worsening weather because these regions are among the highest-risk locations. It is estimated that by 2050, 80% of China’s GDP will emanate from areas that are at some risk of flooding.
“If you are in a high-risk area, you could see premiums double,” said Andrew Dlugo-lecki, an authority on the impact of climate change on the insurance industry and a visiting research fellow at the University of East Anglia’s Climatic Research Unit. “This depends on the severity and frequency of bad weather and how well protected properties are from the increased risks.”
As the impact of climate change on weather patterns becomes clearer, many companies could start to feel the effects. Matthew Grimwade of Aon, an insurance broker and risk-assessment firm, said: “We are already seeing rates for natural disasters increasing by about 10%, and prices will probably increase more than that by the end of this year.”
The inability to afford or secure an insurance policy for a particular property – be it an office building on the coast of Britain or a manufacturing plant in Asia – poses a number of problems for businesses. It could result in companies shifting their assets to safer locations that are less prone to climatic disasters and it could lead to shifts of employment and economic growth.
There are also likely to be financial implications for governments. A forthcoming report by the International Institute for Applied Systems Analysis, funded by the European Commission, will show that the EU Solidarity Fund, which is worth €1 billion and is supposed to cover “uninsurable risk” for government-owned infrastructure such as roads and bridges, is not enough to cover the damage caused by the more frequent storms and flooding that are expected.
According to Reinhard Mechler, one of the report’s researchers, annual losses from floods alone could rise to as much as €1.2 billion by 2030. “With a worsening climate an increase in fund resources is needed,” said Mechler.
March 22, 2009
Weather-related problems have been underestimated by scientists
Tricia Holly Davis
INSURANCE companies are set to raise their estimates for future premiums because of the effects of climate change.
Firms that operate in areas where floods and storms cause a growing amount of damage are likely to see the cost of cover rise by as much as 100% in the next 10 years.
The findings by the Association of British Insurers (ABI) reflect a growing belief in the industry that the consequences of changes in weather patterns have been underestimated.
A report to be published by the ABI this year argues that previous predictions of climate-change damage made in 2005, on which the industry now relies, are too low. “We are concerned that our estimates in our [last] report were too conservative,” said Swenja Surminski at the ABI. “Climate change is likely to have a more severe impact on the future price, affordability and availability of insurance coverage.”
There is a growing sense among scientists that climate-change predictions have been too cautious and that the world faces threats of a different order than was thought even a year ago.
At the Copenhagen climate summit this month, delegates warned that “the worst-case scenario trajectories, or even worse, are being realised”.
Last year was one of the costliest catastrophe years in history. Globally, large-scale events including floods, storms and hurricanes as well as man-made disasters such as explosions or oil and chemical spill-ages, led to economic losses of $269 billion (£186 billion), representing more than a threefold increase from 2007, when losses were $70 billion, and more than five times the losses in 2006, according to a report by Swiss Re, the reinsurer.
The resulting cost to property insurers last year totalled $52 billion. The bulk of this, some $44 billion, was due to natural catastrophes, with storm damage causing the greatest number of claims.
In Europe, the costliest natural catastrophe was Emma, a winter storm that crossed large parts of Europe with wind speeds of up to 95mph, causing insured losses of $1.5 billion and overall losses of $2 billion.
Businesses that have outsourced their production to developing nations such as China and India to save on labour costs may be the hardest hit by worsening weather because these regions are among the highest-risk locations. It is estimated that by 2050, 80% of China’s GDP will emanate from areas that are at some risk of flooding.
“If you are in a high-risk area, you could see premiums double,” said Andrew Dlugo-lecki, an authority on the impact of climate change on the insurance industry and a visiting research fellow at the University of East Anglia’s Climatic Research Unit. “This depends on the severity and frequency of bad weather and how well protected properties are from the increased risks.”
As the impact of climate change on weather patterns becomes clearer, many companies could start to feel the effects. Matthew Grimwade of Aon, an insurance broker and risk-assessment firm, said: “We are already seeing rates for natural disasters increasing by about 10%, and prices will probably increase more than that by the end of this year.”
The inability to afford or secure an insurance policy for a particular property – be it an office building on the coast of Britain or a manufacturing plant in Asia – poses a number of problems for businesses. It could result in companies shifting their assets to safer locations that are less prone to climatic disasters and it could lead to shifts of employment and economic growth.
There are also likely to be financial implications for governments. A forthcoming report by the International Institute for Applied Systems Analysis, funded by the European Commission, will show that the EU Solidarity Fund, which is worth €1 billion and is supposed to cover “uninsurable risk” for government-owned infrastructure such as roads and bridges, is not enough to cover the damage caused by the more frequent storms and flooding that are expected.
According to Reinhard Mechler, one of the report’s researchers, annual losses from floods alone could rise to as much as €1.2 billion by 2030. “With a worsening climate an increase in fund resources is needed,” said Mechler.
Why Coca-Cola’s commitment to water sustainability is the ‘real thing’
Sunday, 22 March 2009
Guha: 'There are still some people who doubt just how genuine is the conversion of business to the ideas of sustainability or who fear the downturn will see environmental concerns downgraded by companies. They misunderstand the business imperative.'
The stress on the world’s water resources is a grave concern. Experts, political decision-makers and leading businesses gathered in Istanbul this week to search for solutions.
Our population is growing and, as we become more prosperous, the amount of water we use is growing too. Climate change is increasingly adding to the pressures, making agricultural land unproductive, forcing the mass movement of people and inflaming tensions and conflict.
As the Independent on Sunday highlighted last week, by 2030 over half the world’s population, mostly in developing countries, could be living in areas where water is running short. The World Economic Forum warned that the problems we face from the current economic turmoil could be dwarfed by those stemming from a water crisis which could see harvests cut by a third.
These bleak forecasts should push water scarcity right to the top of all our agendas. It is a particular concern to a company like Coca-Cola. Water is the most important ingredient in all our beverages. It is essential for the production of sugar and other crops we rely on. Without it, we simply don’t have a business.
But the importance of water for us – and the reason for our support for World Water Day today– goes beyond this direct relationship with our products. Across the private sector there is now a recognition that access to clean and sufficient water supplies is necessary for sustainable communities without which there can be no long-term, sustainable future for our businesses.
There are still some people who doubt just how genuine is the conversion of business to the ideas of sustainability or who fear the downturn will see environmental concerns downgraded by companies. They misunderstand the business imperative.
The sceptics are right that companies like ours have not overnight become charities. Our aim remains to sell more drinks. But if we intend to celebrate our bi-centenary in 2086 in good health, our growth has to be achieved in a way which is sustainable.
So what does this mean in practice for a company like Coca-Cola? Does our support for World Water Day and sustainability go further than just some well-chosen words?
We believe it does. This doesn’t mean that we have, by any means, got everything right yet, let alone can defend every decision we have made in the past. Indeed, it is to benefit from outside expertise and turn our aspirations into solid improvement on the ground that we have entered into a global water partnership with WWF.
We are now committed to do what we can to promote good water stewardship and husband precious resources in all the 200 countries in which we operate. Our public goal is to return to communities and nature the amount of water equivalent to all we use in our drinks and their production.
When 1.5 billion of our drinks are enjoyed every day, this is not a goal which can be met overnight. But through reducing water use in our plants, stepping up the recycling of water use in our manufacturing process and playing our part in replenishing water reserves, we are already making progress.
In many ways, cutting our own direct water consumption is the easy part. Through more efficient practices, our water consumption fell by 2% between 2002 and 2007 while the global volume of drinks we produced grew by more than 20%. We want to go further and, as part of our partnership with WWF, have set ourselves a global target to improve water use efficiency by 20% by 2012.
On waste water recycling, too, we have a good record. Our aim is to return to nature all the water we use in our manufacturing processes in a state which can support agriculture and aquatic life. We already do this in 85% of our bottling plants and intend to match this performance everywhere by the end of next year.
We accept, too, we have to look beyond our operations, not least to help rebalance the water contained in our drinks. Across the world, we are working with a whole range of partners from schools to the United Nations to protect and improve water resources and provide access – often for the first time – to clean water for communities.
We are involved in more than 200 projects in over 60 countries from community reservoirs in India to cleaning up Lake Malawi. With the WWF in particular, we are working to protect and improve some of the world’s most important freshwater sources including the Danube, the Yangtze, the Rio Grande and Mekong.
We understand as well that there is little point in cleaning our plant’s water only to pump it back into a stream which is already heavily polluted. It might allow us to tick our own corporate box but it does nothing to solve the problem of water scarcity. So we are increasingly involved in tackling water pollution outside our operations. It is why, for example, we have just committed ourselves to spend another $30 million dollars to provide clean water and proper sanitation to two million more people in Africa.
Water sustainability is also now central to our investment decisions. Potential markets and ease of distribution were once the key factors in deciding where to build plants. Now it is the long-term supply of water. We consult widely with community groups, as well as local and central government, before going ahead. We understand that water challenges are local and that pointing to the progress you are making in Scandinavia where there is plenty of rainfall is no good if you are doing too little in drought-hit Africa.
We are also looking at our indirect use of water with WWF, and other partners, in order to manage our overall water footprint. We know that sugar, some of which is irrigated, is one of our most water intensive ingredients. So we are reviewing how best practices can be applied to irrigated sugar - especially in water stressed regions and where water is withdrawn from aquifers.
Businesses across a whole range of sectors are taking a similar approach to water and sustainability. Our consumers must press us to go further and faster. It is in our interests as well as the planet’s to continue on this journey.
Sanjay Guha is President of Coca-Cola Great Britain
Guha: 'There are still some people who doubt just how genuine is the conversion of business to the ideas of sustainability or who fear the downturn will see environmental concerns downgraded by companies. They misunderstand the business imperative.'
The stress on the world’s water resources is a grave concern. Experts, political decision-makers and leading businesses gathered in Istanbul this week to search for solutions.
Our population is growing and, as we become more prosperous, the amount of water we use is growing too. Climate change is increasingly adding to the pressures, making agricultural land unproductive, forcing the mass movement of people and inflaming tensions and conflict.
As the Independent on Sunday highlighted last week, by 2030 over half the world’s population, mostly in developing countries, could be living in areas where water is running short. The World Economic Forum warned that the problems we face from the current economic turmoil could be dwarfed by those stemming from a water crisis which could see harvests cut by a third.
These bleak forecasts should push water scarcity right to the top of all our agendas. It is a particular concern to a company like Coca-Cola. Water is the most important ingredient in all our beverages. It is essential for the production of sugar and other crops we rely on. Without it, we simply don’t have a business.
But the importance of water for us – and the reason for our support for World Water Day today– goes beyond this direct relationship with our products. Across the private sector there is now a recognition that access to clean and sufficient water supplies is necessary for sustainable communities without which there can be no long-term, sustainable future for our businesses.
There are still some people who doubt just how genuine is the conversion of business to the ideas of sustainability or who fear the downturn will see environmental concerns downgraded by companies. They misunderstand the business imperative.
The sceptics are right that companies like ours have not overnight become charities. Our aim remains to sell more drinks. But if we intend to celebrate our bi-centenary in 2086 in good health, our growth has to be achieved in a way which is sustainable.
So what does this mean in practice for a company like Coca-Cola? Does our support for World Water Day and sustainability go further than just some well-chosen words?
We believe it does. This doesn’t mean that we have, by any means, got everything right yet, let alone can defend every decision we have made in the past. Indeed, it is to benefit from outside expertise and turn our aspirations into solid improvement on the ground that we have entered into a global water partnership with WWF.
We are now committed to do what we can to promote good water stewardship and husband precious resources in all the 200 countries in which we operate. Our public goal is to return to communities and nature the amount of water equivalent to all we use in our drinks and their production.
When 1.5 billion of our drinks are enjoyed every day, this is not a goal which can be met overnight. But through reducing water use in our plants, stepping up the recycling of water use in our manufacturing process and playing our part in replenishing water reserves, we are already making progress.
In many ways, cutting our own direct water consumption is the easy part. Through more efficient practices, our water consumption fell by 2% between 2002 and 2007 while the global volume of drinks we produced grew by more than 20%. We want to go further and, as part of our partnership with WWF, have set ourselves a global target to improve water use efficiency by 20% by 2012.
On waste water recycling, too, we have a good record. Our aim is to return to nature all the water we use in our manufacturing processes in a state which can support agriculture and aquatic life. We already do this in 85% of our bottling plants and intend to match this performance everywhere by the end of next year.
We accept, too, we have to look beyond our operations, not least to help rebalance the water contained in our drinks. Across the world, we are working with a whole range of partners from schools to the United Nations to protect and improve water resources and provide access – often for the first time – to clean water for communities.
We are involved in more than 200 projects in over 60 countries from community reservoirs in India to cleaning up Lake Malawi. With the WWF in particular, we are working to protect and improve some of the world’s most important freshwater sources including the Danube, the Yangtze, the Rio Grande and Mekong.
We understand as well that there is little point in cleaning our plant’s water only to pump it back into a stream which is already heavily polluted. It might allow us to tick our own corporate box but it does nothing to solve the problem of water scarcity. So we are increasingly involved in tackling water pollution outside our operations. It is why, for example, we have just committed ourselves to spend another $30 million dollars to provide clean water and proper sanitation to two million more people in Africa.
Water sustainability is also now central to our investment decisions. Potential markets and ease of distribution were once the key factors in deciding where to build plants. Now it is the long-term supply of water. We consult widely with community groups, as well as local and central government, before going ahead. We understand that water challenges are local and that pointing to the progress you are making in Scandinavia where there is plenty of rainfall is no good if you are doing too little in drought-hit Africa.
We are also looking at our indirect use of water with WWF, and other partners, in order to manage our overall water footprint. We know that sugar, some of which is irrigated, is one of our most water intensive ingredients. So we are reviewing how best practices can be applied to irrigated sugar - especially in water stressed regions and where water is withdrawn from aquifers.
Businesses across a whole range of sectors are taking a similar approach to water and sustainability. Our consumers must press us to go further and faster. It is in our interests as well as the planet’s to continue on this journey.
Sanjay Guha is President of Coca-Cola Great Britain
British firm barcodes trees to save the world’s forests
The Sunday Times
March 22, 2009
A system developed by Helveta will prevent illegal logging by keeping track of timber
Kate Walsh from Liberia
BARCODING every tree in an African rainforest sounds as plausible as counting grains of sand on a beach, but this is exactly what one British company has set out to do. Helveta, a technology firm based in Oxford, is developing a system for tracking timber that will help prevent illegal logging and could become a template for forest management all over the world.
Using a system of barcoding similar to that used by supermarkets for stock control, Helveta aims to tag all 90m trees in 4.3m hectares of rainforest in Liberia. The marking process will allow customers in Britain and elsewhere to trace every timber plank or piece of garden furniture back to its stump. The Liberian government has awarded the company a £1m, four-year contract to implement the system.
A 14-year civil war destroyed much of Liberia’s forestry sector, along with the country’s infrastructure. At the height of the fighting, the country’s fragile forests were being stripped to pay for weapons. Niangon and Lovoa, high-quality timber used in furniture making and worth up to £180 a cubic metre, was sold to buy guns and ammunition.
Helveta claims its system of mapping is the only one in the world that can guarantee the “sustainability and legality” of timber. Climate change is making the protection and management of forests a priority – the provenance of timber is therefore becoming “critically important” to retailers such as B&Q and Habitat, the company said. “Our appetite in the West for ethically-sourced goods – whether it’s coffee or chocolate – is growing and retailers are responding to that,” said Derek Charter, Helveta’s project manager in Liberia. “There is also a raft of different legislation being put in place – at EU and UK-government level – that will enforce the legality of timber on the retailer. In other words, if retailers cannot prove where the timber has come from, they could be penalised.”
The process of barcoding each tree – about 1m of the 90m tagged trees will actually be harvested – is fairly simple. A 4cm plastic tag, which has a unique identity number, is hammered into the tree trunk. Only trees over 40cm in diameter can be tagged; anything smaller than that is protected.
After the tree has been felled, another tag (carrying the same identity number) is hammered into the stump.
“The barcode gives a record of where exactly the tree stands in the forest,” said Charter. “Ultimately, it will create a map of the forest. It also records the species and what that tree would be expected to yield. All this information is stored in our database in Reading.
“If you went into a furniture retailer on the high street and asked where a garden table came from, they will look at the ticket and say it is from a forest in Bolivia but they have no proof – that’s just where they have been told it is from or where the invoice was paid.
“With our system you could go to our website, type in the tree’s identity number and it will show you a map of Liberia and then zoom into the stump where your timber was harvested from. The current principle is that the country can use that information to market its natural resources to the buyer.”
The process of tagging trees would be time-consuming in any country, but is even more so in Liberia where the infrastructure is so degraded that roads have to be built to get into the forest. In addition, the level of education in the country is very low – people have to be trained to do the most basic tasks.
The government hopes that the first tagged log will be exported before the end of the year.
Some conservationists have criticised Liberia’s plans to cut down trees – sustainably or not – instead of setting aside its rainforest for carbon offsetting. Employment is the government’s biggest argument in favour of logging, together with the tax revenues it will generate. It is estimated that the forestry sector could employ 10,000 people directly by 2012 and another 30,000-40,000 indirectly.
US Aid, the American development agency, together with the UN and the World Bank, have invested $20m in the country’s forestry sector to prevent a return to the days of illegal logging. The result is that not a single log has been exported from Liberia since the lifting of the embargo three years ago.
Peter Lowe, forestry co-ordinator at the World Bank, said: “Liberia really has bravely taken the challenge to set regional standards in forest conservation. [Barcoding] is the most sophisticated system I’ve seen because it requires levels of transparency that don’t normally exist.”
March 22, 2009
A system developed by Helveta will prevent illegal logging by keeping track of timber
Kate Walsh from Liberia
BARCODING every tree in an African rainforest sounds as plausible as counting grains of sand on a beach, but this is exactly what one British company has set out to do. Helveta, a technology firm based in Oxford, is developing a system for tracking timber that will help prevent illegal logging and could become a template for forest management all over the world.
Using a system of barcoding similar to that used by supermarkets for stock control, Helveta aims to tag all 90m trees in 4.3m hectares of rainforest in Liberia. The marking process will allow customers in Britain and elsewhere to trace every timber plank or piece of garden furniture back to its stump. The Liberian government has awarded the company a £1m, four-year contract to implement the system.
A 14-year civil war destroyed much of Liberia’s forestry sector, along with the country’s infrastructure. At the height of the fighting, the country’s fragile forests were being stripped to pay for weapons. Niangon and Lovoa, high-quality timber used in furniture making and worth up to £180 a cubic metre, was sold to buy guns and ammunition.
Helveta claims its system of mapping is the only one in the world that can guarantee the “sustainability and legality” of timber. Climate change is making the protection and management of forests a priority – the provenance of timber is therefore becoming “critically important” to retailers such as B&Q and Habitat, the company said. “Our appetite in the West for ethically-sourced goods – whether it’s coffee or chocolate – is growing and retailers are responding to that,” said Derek Charter, Helveta’s project manager in Liberia. “There is also a raft of different legislation being put in place – at EU and UK-government level – that will enforce the legality of timber on the retailer. In other words, if retailers cannot prove where the timber has come from, they could be penalised.”
The process of barcoding each tree – about 1m of the 90m tagged trees will actually be harvested – is fairly simple. A 4cm plastic tag, which has a unique identity number, is hammered into the tree trunk. Only trees over 40cm in diameter can be tagged; anything smaller than that is protected.
After the tree has been felled, another tag (carrying the same identity number) is hammered into the stump.
“The barcode gives a record of where exactly the tree stands in the forest,” said Charter. “Ultimately, it will create a map of the forest. It also records the species and what that tree would be expected to yield. All this information is stored in our database in Reading.
“If you went into a furniture retailer on the high street and asked where a garden table came from, they will look at the ticket and say it is from a forest in Bolivia but they have no proof – that’s just where they have been told it is from or where the invoice was paid.
“With our system you could go to our website, type in the tree’s identity number and it will show you a map of Liberia and then zoom into the stump where your timber was harvested from. The current principle is that the country can use that information to market its natural resources to the buyer.”
The process of tagging trees would be time-consuming in any country, but is even more so in Liberia where the infrastructure is so degraded that roads have to be built to get into the forest. In addition, the level of education in the country is very low – people have to be trained to do the most basic tasks.
The government hopes that the first tagged log will be exported before the end of the year.
Some conservationists have criticised Liberia’s plans to cut down trees – sustainably or not – instead of setting aside its rainforest for carbon offsetting. Employment is the government’s biggest argument in favour of logging, together with the tax revenues it will generate. It is estimated that the forestry sector could employ 10,000 people directly by 2012 and another 30,000-40,000 indirectly.
US Aid, the American development agency, together with the UN and the World Bank, have invested $20m in the country’s forestry sector to prevent a return to the days of illegal logging. The result is that not a single log has been exported from Liberia since the lifting of the embargo three years ago.
Peter Lowe, forestry co-ordinator at the World Bank, said: “Liberia really has bravely taken the challenge to set regional standards in forest conservation. [Barcoding] is the most sophisticated system I’ve seen because it requires levels of transparency that don’t normally exist.”
Shell goes to paradise in search of cheap biofuel
The Sunday Times
March 22, 2009
One of the survivors in the oil giant’s slimmed-down green drive
Danny Fortson
The Hawaiian island of Kona, a volcanic stump with white sand beaches and aquamarine waters in the middle of the Pacific, has long drawn adventurers and paradise-seekers. It was here that Captain James Cook was stabbed by islanders and left to die face down in the surf.
More than two centuries on, new pioneers are stalking its shores. Last week a small company backed by the oil giant Royal Dutch Shell provided the first batch of a locally made oil to the American government for testing as aviation fuel. It has the combustion properties of fuel derived from crude oil but it is made from algae.
The advantages over conventional biofuels are clear – it is not made from crops grown on agricultural land so it cannot be blamed for driving up food prices or using scarce fresh water.
It sounds almost too good to be true. It probably is. The technology to convert algae into usable fuel on a large scale is still at least a decade away, and it is unclear if it will ever be practical on a large scale.
Shell refuses to say how much it has invested in the project. Nonetheless, it has put the full weight of its PR machine behind this and the handful of other renewable technologies it is developing, giving it a nice green sheen even as it deepens its involvement in controversial areas such as the Canadian tar sands.
The company has had to deal with a $100 drop in the price of oil and lower demand for its products, so it is cutting spending and has pulled out of several renewables sectors altogether. Chief executive Jeroen van der Veer confirmed last week that the company will stop investing in hydrogen technologies and wind power – it has pulled out of all its British projects in the past year. Solar has gone the same way. That leaves clean coal technology and “second generation” biofuels such as algae as its primary focus.
The fast-growing algae are native to the seas off Hawaii – cultured in tanks fed with sea-water in a pilot plant run in collaboration with the local firm HR Biopetroleum. If its scientists can perfect the algae-to-oil process, Shell says it will fund an industrial facility of 20,000 hectares, built by Cellana, the Shell-HR Biopetroleum joint venture, on coastal land unsuitable for farming.
A facility of that size could produce 16,000 barrels of oil equivalent a day. At that rate, seven such plants would be needed to generate as much oil as one reasonably productive offshore platform. The good news is that algae can double their mass several times a day using sunlight alone and the supply would never run dry.
On the Kona coast, Cellana has already built some photo-bioreactors – essentially high-tech greenhouses that use natural light and a carbon-dioxide injection system to speed up natural growth rates. The company is testing new strains of the plant to find the most oil-rich and fast-growing varieties. The conversion process is similar to that for other biofuels: the algae are dried and broken down into oil and protein.
The process is still in development. Gordon MacManus, an analyst at the research firm Wood Mackenzie, said that, as a biofuel source, algae hold great potential but the technology is at a “very early stage”. He said that it could be “more than a decade” before it is commercially practical.
It is one of several “second-generation” biofuels that could one day overtake Shell’s other efforts in making biofuels from crops. It has recently increased its stake in Codexis, an American group that develops enzymes to improve the process of creating ethanol from lignocellulose, the woody part of plants, that another Shell partner Iogen is working on.
Such fuels are many years from making it to the market – if, indeed, they make it at all. And Shell leaves most of the scientific challenges to its partner organisations; it provides the cash and research support. Meanwhile, the company remains one of the world’s biggest providers of often-ma-ligned “first generation” biofuels such as corn-based ethanol.
Just as the first drum of algae-produced oil was flown from Kona to America’s Defense Advanced Research Projects Agency, Shell said that it was abandoning renewables, except for some biofuels.
When the announcement was made last Tuesday, critics accused Shell of a sell-out. But the company said it was responding to a change in the economic climate and the new reality that crude oil is now about $100 a barrel cheaper than a year ago.
Shell was never that green in the first place. It has the largest investment programme of any private enterprise in the world, spending $90 billion (£62 billion) in the past five years on projects ranging from the Gulf of Mexico to Iraq. Over that same period it gave back $68 billion to shareholders through dividends and share buybacks.
By comparison, its investment in alternative energy is tiny, amounting to only $1.7 billion – less than 2% of its total spending over the same five years. That investment programme is about to dwindle further. Van der Veer’s message last week was straightforward: it’s not that renewables don’t make money, it’s that they don’t make enough. “We do not expect [renewables] to grow much from here, due to portfolio fit and the returns outlook compared with other opportunities,” he said.
Far from abandoning renewables, Shell said, it is simply narrowing its focus on the areas where it has the most expertise and can effect the most change.
Environmentalists fear that Shell’s efforts to go green could end up like Captain Cook on the shores of Kona – left to die in the surf.
GREEN IDEAS
Zenex Gas Saver
Domestic gas boilers can lose up to half of their energy efficiency because the flue gases they vent into the air are hot – up to 85C. Zenex (zenexenergy.com), a Plymouth company, aims to recapture much of that wasted energy by passing the flue gases through a heat exchanger before they are released into the atmosphere.
Zenex’s Gas Saver system sits on top of the boiler and reduces the heat of exiting flue gases to a typical 25C. It uses the reclaimed heat to warm the water entering the boiler. This saves an estimated 3kW of energy, or about 20p worth of gas, for every hour of operation.
The Gas Saver unit costs £600.
Got a great green idea? E-mail it to us at greenideas@sunday-times.co.uk and share it with the world.
March 22, 2009
One of the survivors in the oil giant’s slimmed-down green drive
Danny Fortson
The Hawaiian island of Kona, a volcanic stump with white sand beaches and aquamarine waters in the middle of the Pacific, has long drawn adventurers and paradise-seekers. It was here that Captain James Cook was stabbed by islanders and left to die face down in the surf.
More than two centuries on, new pioneers are stalking its shores. Last week a small company backed by the oil giant Royal Dutch Shell provided the first batch of a locally made oil to the American government for testing as aviation fuel. It has the combustion properties of fuel derived from crude oil but it is made from algae.
The advantages over conventional biofuels are clear – it is not made from crops grown on agricultural land so it cannot be blamed for driving up food prices or using scarce fresh water.
It sounds almost too good to be true. It probably is. The technology to convert algae into usable fuel on a large scale is still at least a decade away, and it is unclear if it will ever be practical on a large scale.
Shell refuses to say how much it has invested in the project. Nonetheless, it has put the full weight of its PR machine behind this and the handful of other renewable technologies it is developing, giving it a nice green sheen even as it deepens its involvement in controversial areas such as the Canadian tar sands.
The company has had to deal with a $100 drop in the price of oil and lower demand for its products, so it is cutting spending and has pulled out of several renewables sectors altogether. Chief executive Jeroen van der Veer confirmed last week that the company will stop investing in hydrogen technologies and wind power – it has pulled out of all its British projects in the past year. Solar has gone the same way. That leaves clean coal technology and “second generation” biofuels such as algae as its primary focus.
The fast-growing algae are native to the seas off Hawaii – cultured in tanks fed with sea-water in a pilot plant run in collaboration with the local firm HR Biopetroleum. If its scientists can perfect the algae-to-oil process, Shell says it will fund an industrial facility of 20,000 hectares, built by Cellana, the Shell-HR Biopetroleum joint venture, on coastal land unsuitable for farming.
A facility of that size could produce 16,000 barrels of oil equivalent a day. At that rate, seven such plants would be needed to generate as much oil as one reasonably productive offshore platform. The good news is that algae can double their mass several times a day using sunlight alone and the supply would never run dry.
On the Kona coast, Cellana has already built some photo-bioreactors – essentially high-tech greenhouses that use natural light and a carbon-dioxide injection system to speed up natural growth rates. The company is testing new strains of the plant to find the most oil-rich and fast-growing varieties. The conversion process is similar to that for other biofuels: the algae are dried and broken down into oil and protein.
The process is still in development. Gordon MacManus, an analyst at the research firm Wood Mackenzie, said that, as a biofuel source, algae hold great potential but the technology is at a “very early stage”. He said that it could be “more than a decade” before it is commercially practical.
It is one of several “second-generation” biofuels that could one day overtake Shell’s other efforts in making biofuels from crops. It has recently increased its stake in Codexis, an American group that develops enzymes to improve the process of creating ethanol from lignocellulose, the woody part of plants, that another Shell partner Iogen is working on.
Such fuels are many years from making it to the market – if, indeed, they make it at all. And Shell leaves most of the scientific challenges to its partner organisations; it provides the cash and research support. Meanwhile, the company remains one of the world’s biggest providers of often-ma-ligned “first generation” biofuels such as corn-based ethanol.
Just as the first drum of algae-produced oil was flown from Kona to America’s Defense Advanced Research Projects Agency, Shell said that it was abandoning renewables, except for some biofuels.
When the announcement was made last Tuesday, critics accused Shell of a sell-out. But the company said it was responding to a change in the economic climate and the new reality that crude oil is now about $100 a barrel cheaper than a year ago.
Shell was never that green in the first place. It has the largest investment programme of any private enterprise in the world, spending $90 billion (£62 billion) in the past five years on projects ranging from the Gulf of Mexico to Iraq. Over that same period it gave back $68 billion to shareholders through dividends and share buybacks.
By comparison, its investment in alternative energy is tiny, amounting to only $1.7 billion – less than 2% of its total spending over the same five years. That investment programme is about to dwindle further. Van der Veer’s message last week was straightforward: it’s not that renewables don’t make money, it’s that they don’t make enough. “We do not expect [renewables] to grow much from here, due to portfolio fit and the returns outlook compared with other opportunities,” he said.
Far from abandoning renewables, Shell said, it is simply narrowing its focus on the areas where it has the most expertise and can effect the most change.
Environmentalists fear that Shell’s efforts to go green could end up like Captain Cook on the shores of Kona – left to die in the surf.
GREEN IDEAS
Zenex Gas Saver
Domestic gas boilers can lose up to half of their energy efficiency because the flue gases they vent into the air are hot – up to 85C. Zenex (zenexenergy.com), a Plymouth company, aims to recapture much of that wasted energy by passing the flue gases through a heat exchanger before they are released into the atmosphere.
Zenex’s Gas Saver system sits on top of the boiler and reduces the heat of exiting flue gases to a typical 25C. It uses the reclaimed heat to warm the water entering the boiler. This saves an estimated 3kW of energy, or about 20p worth of gas, for every hour of operation.
The Gas Saver unit costs £600.
Got a great green idea? E-mail it to us at greenideas@sunday-times.co.uk and share it with the world.
Wave energy firm agrees £2m deal
Published Date: 22 March 2009
By Nathalie Thomas
SCOTLAND'S ambition to become a leader in marine energy will take another step forward tomorrow with the announcement of a £2m contract to install the UK's first near-shore wave energy generator off the coast of Orkney.
Aquamarine Power, a renewable energy firm based in Edinburgh, has signed a £2m contract with marine construction group Fugro Seacore to install its 'Oyster' convertor at the European Marine Energy Centre (EMEC) in Orkney.The technology, designed for waters of between eight and 16 metres in depth, is expected to be installed 500 metres offshore by the autumn.It is hoped that it will contribute between 300kW and 600kW to the National Grid, a small step towards the Scottish Government's goal to source 50% of the country's electricity from renewable sources by 2020. The scheme in Orkney is the first in what Aquamarine hopes will be a string of projects after it last month agreed a joint venture with a subsidiary of Scottish & Southern Energy to develop one gigawatt of wave and tidal power off the coast of the UK and Ireland by 2020. The deal with Airtricity, the renewable energy firm acquired by SSE in 2008 for £1bn, was heralded as "the biggest deal in the history of marine energy". Work has also begun on another unnamed location and Aquamarine is investigating several other sites. Aquamarine's Oyster converter consists of a single pump which, when hit by a wave, sends high-pressure water through a pipeline beneath the sea to an onshore generator. This then converts the water into electricity using hydroelectric generators.Martin McAdam, chief executive of Aquamarine Power, said: "The future of electricity generated from wave energy starts now."So far marine energy has been slow off the starting block compared with more developed technologies such as hydro and wind power, but experts predict that Scotland could eventually account for 25% of Europe's total tidal electricity generation and 10% of wave energy generation. The Scottish Government-backed EMEC already plays host to two other marine energy technologies including a deep-water floating device designed by Edinburgh firm Pelamis Wave Power.However, it is thought it will be several years before marine energy becomes a credible, commercially viable force in renewable energy generation. According to figures from the Scottish Government, there are currently 0.5 megawatts (MW) of installed and planned wave capacity in Scotland compared with 1,550MW for wind, 1,380MW for hydro and 79MW for biomass.At a renewable energy conference held in Edinburgh last month, Neil Kermode, managing director of EMEC, admitted: "The industry is much closer at the moment to the Wright brothers than to Airbus
Published Date: 22 March 2009
By Nathalie Thomas
SCOTLAND'S ambition to become a leader in marine energy will take another step forward tomorrow with the announcement of a £2m contract to install the UK's first near-shore wave energy generator off the coast of Orkney.
Aquamarine Power, a renewable energy firm based in Edinburgh, has signed a £2m contract with marine construction group Fugro Seacore to install its 'Oyster' convertor at the European Marine Energy Centre (EMEC) in Orkney.The technology, designed for waters of between eight and 16 metres in depth, is expected to be installed 500 metres offshore by the autumn.It is hoped that it will contribute between 300kW and 600kW to the National Grid, a small step towards the Scottish Government's goal to source 50% of the country's electricity from renewable sources by 2020. The scheme in Orkney is the first in what Aquamarine hopes will be a string of projects after it last month agreed a joint venture with a subsidiary of Scottish & Southern Energy to develop one gigawatt of wave and tidal power off the coast of the UK and Ireland by 2020. The deal with Airtricity, the renewable energy firm acquired by SSE in 2008 for £1bn, was heralded as "the biggest deal in the history of marine energy". Work has also begun on another unnamed location and Aquamarine is investigating several other sites. Aquamarine's Oyster converter consists of a single pump which, when hit by a wave, sends high-pressure water through a pipeline beneath the sea to an onshore generator. This then converts the water into electricity using hydroelectric generators.Martin McAdam, chief executive of Aquamarine Power, said: "The future of electricity generated from wave energy starts now."So far marine energy has been slow off the starting block compared with more developed technologies such as hydro and wind power, but experts predict that Scotland could eventually account for 25% of Europe's total tidal electricity generation and 10% of wave energy generation. The Scottish Government-backed EMEC already plays host to two other marine energy technologies including a deep-water floating device designed by Edinburgh firm Pelamis Wave Power.However, it is thought it will be several years before marine energy becomes a credible, commercially viable force in renewable energy generation. According to figures from the Scottish Government, there are currently 0.5 megawatts (MW) of installed and planned wave capacity in Scotland compared with 1,550MW for wind, 1,380MW for hydro and 79MW for biomass.At a renewable energy conference held in Edinburgh last month, Neil Kermode, managing director of EMEC, admitted: "The industry is much closer at the moment to the Wright brothers than to Airbus
Wave power project hits the rocks
From The Sunday Times
March 22, 2009
Mechanical setbacks on a key project have come at the same time as the collapse of one of its backers
Alan Copps
A pioneering £8m British green energy project has been halted because of a series of setbacks, including malfunctioning of the innovative equipment designed to turn wave energy into electricity and the financial collapse of one of the scheme’s backers.
Pelamis Wave Power, based in Edinburgh, said its equipment had been towed back to shore in Portugal after it broke down. It will not be repaired immediately. Pelamis’s wave-energy converters are considered to be the most advanced of their kind, and the future of the technology is now in doubt.
If the problems persist they could threaten a similar deal between Pelamis and Eon, the energy group. The partnership was the first instance of a big utility ordering a wave-energy converter for installation in British waters. The equipment was to be tested off Scotland next year.
Energy analysts say the difficulties over the Portuguese project, named Agucadoura, call into the question the viability of this type of wave power.
The technical problems were compounded by the collapse of Babcock & Brown, the Australian company that has a 77% stake in the project and which went into administration last week.
“We are in limbo,” said Max Carcas at Pelamis. “We are progressing and sorting out some problems on a cash-manage-ment basis. But we can’t get the equipment back in the sea on our own.” Carcas was confident the project would continue but could not say when.
Agucadoura was launched amid a lot of hype last summer as a joint venture between Pelamis, Energias de Portugal (EDP), Efacec, the Portuguese electrical engineering company, and Babcock & Brown.
The official unveiling in September was attended by the Portuguese economy minister. The venture was hailed as “the world’s first commercial wave-power project” and began transmitting electricity to the national grid.
Named after the sea snake Pelamis, each machine is 140 metres long, 3.5 metres wide and is partially submerged in the sea. The sections are linked by flexible joints and each section contains a hydraulic pump. The wave motion drives the pumps, which in turn work hydraulic motors that generate an electric current.
In the first phase, three Pelamis wave-energy converters were towed three miles out to sea with the aim of generating 2.25MW of power. If successful, a second phase was planned in which energy generation would rise to 21MW from a further 25 machines – enough to provide electricity for 15,000 Portuguese homes.
Even before the launch, though, the installation was plagued by problems. The date had to be set back after part of the structure sprang a leak.
In November, after two months of generating electricity, the three converter units developed further problems and the apparatus had to be disconnected from the grid and towed back to shore. Then came the news about Babcock & Brown.
Anthony Kennaway at Babcock & Brown, said: “Our business is winding down over the next two years. Agucadoura is one of the assets that we hope to sell.
“This is early-stage technology and you would expect the machines to be in and out of the water. It would be deeply disappointing if people start writing it off at this stage.”
The problems in Portugal cast a shadow over plans to repeat the experiment in trials at the European Marine Energy Centre in Orkney. Last month Eon announced that it had ordered a more advanced P2 machine from Pelamis which, at 180 metres long, is about 40 metres longer than the Pelamis units in Portugal. It will be built at Pelamis’s Leith Docks facility in Edinburgh.
Both companies claim that the deal will go ahead. A spokesman for Eon said: “We still expect to be the first utility company to test a full-size wave-powered generating plant in UK waters. But we have to bear in mind that this technology is in its early stages. It’s where wind power was a decade ago.”
The failure of the Portuguese project highlights the problems engineers have in attempting to harness the power of the sea to create renewable energy. It could also put a question mark over the future of wave energy in the EU’s plan to get 20% of its energy from renewable sources by 2020.
Ian Fells of Newcastle University, who has his own energy consultancy, said: “Wave power is very immature and very expensive compared with other renewable resources because you have to overengineer it to cope with extremes of weather.
“We have to get these things in perspective. Throughout the world wave power generates about 10MW of electricity. You would need something like 10,000 wave power units to replace one nuclear power station.”
GREEN IDEASAshwoods LPG vansCar drivers who want to go green can buy electric, hybrid or biofuel-powered vehicles straight from the manufacturers, but van drivers have no such off-the-shelf option – which is why Ashwoods of Fulham in London (ashwoods.org) converts commercial vans to run on liquefied petroleum gas. LPG is a byproduct of the oil and gas industry and is both a cheaper and a more efficient energy source than petrol or diesel.Ashwoods claims that its LPG vans achieve fuel cost savings of about 40%. Such vans are also exempt from London’s congestion charge, which could save a company up to £2,000 a year on each vehicle. A converted Ford Transit would cost £14,555, or 20% less than the list price. LPG is on sale at more than 1,200 refuelling stations around the country.Ashwoods is also developing a hybrid drive, which it believes will reduce carbon-dioxide emissions by more than 14%. The drive will come in two parts – a system that recovers energy lost during braking plus an electric engine – and can be fitted in less than three hours to many popular van models. The company hopes to start offering the conversion kit at a cost of about £3,000 later this year.greenideas@sunday-times.co.uk
March 22, 2009
Mechanical setbacks on a key project have come at the same time as the collapse of one of its backers
Alan Copps
A pioneering £8m British green energy project has been halted because of a series of setbacks, including malfunctioning of the innovative equipment designed to turn wave energy into electricity and the financial collapse of one of the scheme’s backers.
Pelamis Wave Power, based in Edinburgh, said its equipment had been towed back to shore in Portugal after it broke down. It will not be repaired immediately. Pelamis’s wave-energy converters are considered to be the most advanced of their kind, and the future of the technology is now in doubt.
If the problems persist they could threaten a similar deal between Pelamis and Eon, the energy group. The partnership was the first instance of a big utility ordering a wave-energy converter for installation in British waters. The equipment was to be tested off Scotland next year.
Energy analysts say the difficulties over the Portuguese project, named Agucadoura, call into the question the viability of this type of wave power.
The technical problems were compounded by the collapse of Babcock & Brown, the Australian company that has a 77% stake in the project and which went into administration last week.
“We are in limbo,” said Max Carcas at Pelamis. “We are progressing and sorting out some problems on a cash-manage-ment basis. But we can’t get the equipment back in the sea on our own.” Carcas was confident the project would continue but could not say when.
Agucadoura was launched amid a lot of hype last summer as a joint venture between Pelamis, Energias de Portugal (EDP), Efacec, the Portuguese electrical engineering company, and Babcock & Brown.
The official unveiling in September was attended by the Portuguese economy minister. The venture was hailed as “the world’s first commercial wave-power project” and began transmitting electricity to the national grid.
Named after the sea snake Pelamis, each machine is 140 metres long, 3.5 metres wide and is partially submerged in the sea. The sections are linked by flexible joints and each section contains a hydraulic pump. The wave motion drives the pumps, which in turn work hydraulic motors that generate an electric current.
In the first phase, three Pelamis wave-energy converters were towed three miles out to sea with the aim of generating 2.25MW of power. If successful, a second phase was planned in which energy generation would rise to 21MW from a further 25 machines – enough to provide electricity for 15,000 Portuguese homes.
Even before the launch, though, the installation was plagued by problems. The date had to be set back after part of the structure sprang a leak.
In November, after two months of generating electricity, the three converter units developed further problems and the apparatus had to be disconnected from the grid and towed back to shore. Then came the news about Babcock & Brown.
Anthony Kennaway at Babcock & Brown, said: “Our business is winding down over the next two years. Agucadoura is one of the assets that we hope to sell.
“This is early-stage technology and you would expect the machines to be in and out of the water. It would be deeply disappointing if people start writing it off at this stage.”
The problems in Portugal cast a shadow over plans to repeat the experiment in trials at the European Marine Energy Centre in Orkney. Last month Eon announced that it had ordered a more advanced P2 machine from Pelamis which, at 180 metres long, is about 40 metres longer than the Pelamis units in Portugal. It will be built at Pelamis’s Leith Docks facility in Edinburgh.
Both companies claim that the deal will go ahead. A spokesman for Eon said: “We still expect to be the first utility company to test a full-size wave-powered generating plant in UK waters. But we have to bear in mind that this technology is in its early stages. It’s where wind power was a decade ago.”
The failure of the Portuguese project highlights the problems engineers have in attempting to harness the power of the sea to create renewable energy. It could also put a question mark over the future of wave energy in the EU’s plan to get 20% of its energy from renewable sources by 2020.
Ian Fells of Newcastle University, who has his own energy consultancy, said: “Wave power is very immature and very expensive compared with other renewable resources because you have to overengineer it to cope with extremes of weather.
“We have to get these things in perspective. Throughout the world wave power generates about 10MW of electricity. You would need something like 10,000 wave power units to replace one nuclear power station.”
GREEN IDEASAshwoods LPG vansCar drivers who want to go green can buy electric, hybrid or biofuel-powered vehicles straight from the manufacturers, but van drivers have no such off-the-shelf option – which is why Ashwoods of Fulham in London (ashwoods.org) converts commercial vans to run on liquefied petroleum gas. LPG is a byproduct of the oil and gas industry and is both a cheaper and a more efficient energy source than petrol or diesel.Ashwoods claims that its LPG vans achieve fuel cost savings of about 40%. Such vans are also exempt from London’s congestion charge, which could save a company up to £2,000 a year on each vehicle. A converted Ford Transit would cost £14,555, or 20% less than the list price. LPG is on sale at more than 1,200 refuelling stations around the country.Ashwoods is also developing a hybrid drive, which it believes will reduce carbon-dioxide emissions by more than 14%. The drive will come in two parts – a system that recovers energy lost during braking plus an electric engine – and can be fitted in less than three hours to many popular van models. The company hopes to start offering the conversion kit at a cost of about £3,000 later this year.greenideas@sunday-times.co.uk
Energy firms demand £2bn to save wind farms
The Sunday Times
March 22, 2009
Danny Fortson
ENERGY COMPANIES have warned the government that unless they get £2 billion in “immediate” state aid several offshore wind farms will be scrapped – and this would leave Whitehall’s pollution-reduction targets in tatters.
Companies have put off giving the green light to several big projects, such as the £3 billion London Array in the Thames estuary and Npower’s £2.2 billion Gwint y Mor farm off the coast of Wales, until the government decides whether it will stump up more cash to offset building costs that have doubled in the past three years.
The British Wind Energy Association (BWEA), the industry body, wrote to the government last week warning that the industry is on a knife edge because the credit crisis has made financing these projects prohibitively expensive.
Rocketing costs and the credit crisis opened up a funding gap of about £2 billion for nine projects that have planning consent but haven’t been built. These will cost an estimated £12 billion to complete.
The BWEA warned that, if the government does not take urgent action to fill the funding gap, these farms, which would provide enough capacity to power about 4m homes, will be cancelled.
The plea comes at a critical times for the industry. Eon and its partners Dong Energy and Masdar are expected to decide by June whether to build or abandon the London Array, the largest proposed wind farm in the world. Centrica and Npower also have projects that they have yet to approve.
The energy industry has made three suggestions to the government. One would be to double the per-megawatt subsidy – so-called renewable obligation certificates (ROCs) – that offshore wind receives. Increasing the subsidy from one ROC per megawatt to two would triple the revenue that power companies collect for wholesale electricity. The second suggestion would allow for direct aid through government grants or tax breaks on construction costs.
The third would be to distribute the cost of building the offshore grid – expected to be about £10 billion – among all power companies, whether they have offshore farms or not.
The energy industry wants clarity soon.
The Crown Estate is running an auction for swathes of sea bed that it hopes will be the sites for new wind farms that will be much bigger and thus more expensive.
If the government doesn’t support those on the edge, that process will collapse and deal a big blow to Whitehall’s carbon-reduction targets, companies have warned.
Some have taken a harder line. Both Eon and Centrica argue that generous subsidies have to be paid out over the 20 to 25-year life of an offshore farm for such projects to make economic sense.
Centrica has three projects worth more than £3 billion on which it has yet to make final investment decisions.
Phil Bentley, managing director of British Gas, said: “We haven’t pulled the trigger yet on new projects because it doesn’t make sense under the current terms.”
The BWEA declined to comment on the request for state aid but said: “The government needs to provide quick solutions to today’s problems, and today’s problems are the flow of credit. We are concentrating on measures that will aid the projects that need financial closure this year.”
March 22, 2009
Danny Fortson
ENERGY COMPANIES have warned the government that unless they get £2 billion in “immediate” state aid several offshore wind farms will be scrapped – and this would leave Whitehall’s pollution-reduction targets in tatters.
Companies have put off giving the green light to several big projects, such as the £3 billion London Array in the Thames estuary and Npower’s £2.2 billion Gwint y Mor farm off the coast of Wales, until the government decides whether it will stump up more cash to offset building costs that have doubled in the past three years.
The British Wind Energy Association (BWEA), the industry body, wrote to the government last week warning that the industry is on a knife edge because the credit crisis has made financing these projects prohibitively expensive.
Rocketing costs and the credit crisis opened up a funding gap of about £2 billion for nine projects that have planning consent but haven’t been built. These will cost an estimated £12 billion to complete.
The BWEA warned that, if the government does not take urgent action to fill the funding gap, these farms, which would provide enough capacity to power about 4m homes, will be cancelled.
The plea comes at a critical times for the industry. Eon and its partners Dong Energy and Masdar are expected to decide by June whether to build or abandon the London Array, the largest proposed wind farm in the world. Centrica and Npower also have projects that they have yet to approve.
The energy industry has made three suggestions to the government. One would be to double the per-megawatt subsidy – so-called renewable obligation certificates (ROCs) – that offshore wind receives. Increasing the subsidy from one ROC per megawatt to two would triple the revenue that power companies collect for wholesale electricity. The second suggestion would allow for direct aid through government grants or tax breaks on construction costs.
The third would be to distribute the cost of building the offshore grid – expected to be about £10 billion – among all power companies, whether they have offshore farms or not.
The energy industry wants clarity soon.
The Crown Estate is running an auction for swathes of sea bed that it hopes will be the sites for new wind farms that will be much bigger and thus more expensive.
If the government doesn’t support those on the edge, that process will collapse and deal a big blow to Whitehall’s carbon-reduction targets, companies have warned.
Some have taken a harder line. Both Eon and Centrica argue that generous subsidies have to be paid out over the 20 to 25-year life of an offshore farm for such projects to make economic sense.
Centrica has three projects worth more than £3 billion on which it has yet to make final investment decisions.
Phil Bentley, managing director of British Gas, said: “We haven’t pulled the trigger yet on new projects because it doesn’t make sense under the current terms.”
The BWEA declined to comment on the request for state aid but said: “The government needs to provide quick solutions to today’s problems, and today’s problems are the flow of credit. We are concentrating on measures that will aid the projects that need financial closure this year.”
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