Future Energy

Green Oil?

Source: Fast Company

Newsweek recently ranked 500 U.S. companies on their environmental credentials (see The Greenest Big Companies in America, September 28th).  Only one oil and gas company, Marathon Oil, is included in the top 100 companies and it was number 100. 

After Marathon, you would have to travel down the list to the 154^th spot to find the next oil and gas company, Baker Hughes, an oil and gas service company.  Notably, the coal fired utilities grabbed 13 of the bottom 20 spots in the ranking - NRG Energy ranked 499^th.  Clean coal anyone?

Newsweek relied on three partners to construct the ranking, including:

• Trucost - calculated environmental impact scores;
• KLD Research & Analytics - calculated green policy scores;
• Corporate Register.com - conducted a reputational survey.

The overall scores combined all three of these components and from the limited information on the methodology each partner followed, the scoring looks to be fair.

Back in February 2008, Fast Company magazine went through a similar exercise and ranked the sustainability of the world's 10 largest oil and gas companies (see Fast Company Looks At Oil, February 4, 2008).  In a subsequent post I put together a table comparing Fast Company's rankings with those from the Dow Jones Sustainability Index and the Global 100 Most Sustainable Companies.  I've updated here to include the Newsweek rankings.  Not a lot of overlap.

Companies	Newsweek	Global 100	DJSI	Fast Company
BG Group		√	√
BP			√	1
Royal Dutch Shell		√	√	2
Chevron	√ (371)			3
Marathon Oil	√ (100)			4
ConocoPhillips	√ (238)			5
Total			√	6
ExxonMobil	√ (395)			7
Encana			√
Eni S.p.A.				9
Neste Oil OYJ		√	√
Nexen		√	√
Petroleo Brasileiro			√
Repsol			√	8
Saipem		√
Sasol			√
StatoilHydro		√	√
Suncor			√
TransCanada		√
Valero Energy	√ (332)			10
Woodside Petroleum			√

 

Climate Change Affects Beer? Now its getting serious!

Source: Irritated Tulsan blog

The New Scientist reported last week that a Czech climatologist has concluded that higher temperatures are reducing the quality of the Saalz hops found in the region's classic lager beers (see Climate Change Depresses Beer Drinkers, September 13, 2009).  And this effect is being felt in the traditional hop growing regions of Germany and Slovakia as well. 

Warmer air temperatures are blamed for reducing concentrations of alpha acids in the hops - the element that provides the slightly sharp/bitter taste of good lager - since 1954.

And to add insult to injury, in a somewhat dated article, the Australian Broadcast Corporation, reported that the price of beer is likely to rise as some sources of malt barley are lost to changing temperatures and water shortages (see Scientist: Climate Change to Impact Beer Production, April 8, 2008 and Climate Change Will Impact Beer Production: Scientist, CTV.ca, April 8, 2008).

Achieving Nirvana .. oops, Sustainability ... or Something Like That

Source: Fast Company

Looking around these days, its hard to be optimistic for the future ..... global climate change, ocean acidification, declining freshwater resources, deteriorating world fisheries, growing concentrations of environmental pollutants, peaking oil, concerns for agricultural productivity .... and the list goes on.  In a world with 6 billion people growing inexorably to 10, a little stress is to be expected, but are we doing enough to manage them?

Yvon Chouinard doesn't appear to think so.  In a recent interview with Fast Comapny magazine (see Patagonia's Founder on Why There's "No Such Thing as Sustainability", July 2009) Chouinard had this to say:

“If you keep your eyes open as you travel around, you realize we are destroying this planet. I'm very pessimistic about it."

"Patagonia now exists to put into practice all the things that smart people are saying we have to do not only to save the planet but to save the economy."

"In the broadest sense, working on causes rather than symptoms. If you get down to the real causes, a lot of our society's biggest problems are happening because we're destroying the planet. As we cut down the forests in the Congo, diseases start jumping over to humans. The Pentagon says new wars are going to be resource wars. We're a long way from having a sustain-able society. That's why One Percent for the Planet gives strictly to environmental causes. You can give money all day long to symptomatic things and you're not going to solve the problems."

  "There's no such thing as sustainability. It's just kind of a path you get on and try .... each day try to make it better.”

Mr. Chouinard talks about working on the causes not just the symptoms.  And while sustainability is generally considered to be a balanced focus on environment and social concerns and the economy, I interpret his concern for focusing on the "real causes" to mean a focus on the environmental aspects.

A recent article in the Harvard Business Review seems to agree with this approach, looking at how a company can become environmentally sustainable - and coming closer to Chouinard's "real causes" (see Why Sustainability Is Now the Key Driver of Innovation, September 2009) (Note: the link is courtesy of the NYTimes Green Inc. blog).

Ram Nidumolu, C.K. Prahalad and M.R. Rangaswami look at the benefits of environmental sustainability (e.g. cost reduction, increased revenues, new markets, etc.) and outline a five-stage pathway for companies to follow.  They conclude that sustainability is now the key driver of innovation among corporations today.  Briefly, their 5 steps include:

• Viewing compliance as an opportunity;

• Making value chains sustainable;

• Designing sustainable products and services;

• Developing new business models; and

• Creating next-practice platforms.

The article is good but if you are trying to figure out where to get started, it does tend to look at the issues from 60,000 feet. 

Losing a bit of altitude (but not much), the CERES Principles provide a "code of conduct" of sorts.  The Principles, originally released as the Valdez Principles, are the product of CERES (the Coalition for Environmentally Responsible Economies) a coalition of companies, investors and public groups.  A key focus of the Principles is on the importance of regular reporting on corproate environmental management programs and results. 

If you really want to get your hands dirty (and actually make some changes), you will need to start digging into the specifics of the company and its circumstances.  The earliest practitioner I'm aware of is John Elkington and the UK consultancy he created, SustainAbility.  The Economist recently profiled Elkington/SustainAbility and their coining of the phrase "Triple Bottom Line" as part of a series on management gurus (see Triple Bottom Line, August 27th).  The "Triple Bottom Line" refers to a focus on people and the planet in addition to the usual focus on profits. 

While SustainAbility was the first, sustainability advice is a growth industry now.  Hopefully some of the practitioners and companies can begin to acheive some of the kind of progress that Messrs. Nidumolu, Prahalad and Rangaswami advocate (and that Chouinard seems to be making).

P.S. Today the NYTimes Green Inc. blog has an interview with C.K. Prahalad that focuses on the innovation portion of the authors' message (see Innovation at the Bottom of the Pyramid).  Its definitely worth a read.

 

An Algae Fuel Future? Not for a While yet.

Source: Sustainable Design Update

In October 2007, I looked at algae based biodiesel and several start-up companies that were attempting to establish commercially viable algae to biodiesel technologies (see A View to the Future: Algae-Based Biodiesel?).  At the time, algae based fuels looked to be on the bleeding edge of biodiesel development.  Two years later, has there been any progress towards something like a commercially viable product?  Based on recent commentary its tough to know. 

Last week the Wall Street Journal's Environmental Capital blog highlighted an announcement by Solazyme Inc. of a contract with the US Defense Department to supply 20,000 gallons of algae based biodiesel (see Green Force: US Military's Interest in Algae Fuel Grows, September 8).  Solazyme is a privately held company that as far back as June 2008 claimed that it had  developed an algae fuel that met the specifications of the American Society for Testing and Materials for diesel fuel.  The contract is only for US$8.5 million but several articles I've read commenting on this announcement hint that with DARPA support, a viable fuel source is just a matter of time.

Robert Rapier, writing recently in his R-Squared Energy Blog, has a less optimistic viewpoint.  Writing in a post he entitles "Biofuel Pretenders", he has this to say ...

 "Like many, I was initially enchanted by the possibility of weaning the world away from fossil fuels by using fuel made from algae.  Proponents wrote articles suggesting that we could do just that, provided the necessary investments are made.

Sadly, the story is much more complex than that. The U.S. DOE funded a study for many years into the potential of algae to produce fuel. (For an overview of where things stand from John Benemann, one of the men who co-authored the close-out report of that study (see Algal Biodiesel: Fact or Fiction?) The problem is again one of needing to surmount multiple technical hurdles, and the close-out report states that reality.

While it is a fact that you can produce fuel from algae, the challenges are such that John has written that you can't even buy algal biofuel for $100/gallon.  He said that if you want to separate the reality from the hype, just try to secure a contract with someone to supply you with algal fuel."

(The DARPA/Solazyme contract looks to be valuing algae based biodiesel at $425 a gallon - well north of the $100 level cited by Mr. Rapier)

Noteably, Mr. Rapier, who appears to know more about the difficulties and economics of producing biofuels than I ever expect to, ranks algae based biofuels with the "biofuel pretenders", i.e. those technologies unlikely to provide economic fuel sources anytime soon.

Despite R-Squared's scepticism, there remains lots of interest in algae biofuels.  PG&E's Next100 blog indicated last week that at least 57 firms are competing to develop algae fuels and they are joined by Exxon, BP and Chevron as well as the USDE and Bill Gate's Cascade Investments (see Algae: The Original Solar Cell, September 8).  (It looks like Next 100 gets the number 57 from a GreenPoint Media article entitled How to Rate an Algae Company, August 19).

And last but not least, Greg Breining, writing in Yale's Environment 360 blog, highlights a research project which looks at algae used to produce biofuel and at the same time cleaning sewage wastewater - two products in one process (see From the Sewage Plant, the Promise of Biofuel, July 1)  Maybe that's one way to side-step the difficult economics of algae.

I started my career as an aquatic biologist and I would dearly like to see an algal future at the gas pump.  However, with natural gas at US$3.20/MMBtu today (Henry Hub Spot - Bloomberg.com) and fields like B.C's Horn River likely to remain undeveloped for a while (see In a Glut, Encana's Big Find Untapped, Globe and Mail, September 12) I have a hard time seeing how algae fuels (and most other biofuels) can hope to reach commercial viability in the foreseeable future.  I have to agree with Mr. Rapier on this one.