2011 November 07

4 Ways to Power Your Home with Green Energy

With the rising cost of electricity people are starting to look to alternative ways to power their homes. Think about the increased rent you could charge on your investment properties! The need to provide electricity using more environmentally friendly methods is also becoming more important. Having solar panels for your home (or investment property) is one method of producing alternative power and many people have already taken this on board. If you go to sell your home there are certain real estate agencies that deal specifically with environmentally friendly homes, but it is also worthwhile speaking to conveyancing services who can offer you professional advice.

Solar Energy

Solar energy is created by collecting the sun’s energy in the cells of solar panels and transferring it to power. Solar panels can be installed on the roof of your home and power your lights and your appliances. It can be used to heat your hot water system and your swimming pool and solar energy can even power cars. Small appliances like calculators can run on solar power. Solar power is a green alternative and does not create any carbon emissions in its production. Solar power is an extremely effective way of creating electricity.

Hydro Electricity

Harnessing energy created by moving water has been done for thousands of years. People would use flowing water to push a wheel that would then go on to grind grain. Today hydro electricity is created in much the same way. Water is directed to flow through a turbine which causes it to spin which then powers a generator. Much of the United States’ energy is created this way. Hydro electricity is a greener option and it is a recyclable energy source as the water can be directed back up through the turbine.

Wind Power

Australia has the resources to provide a substantial amount of energy created by the wind. The southern states are subject to the Roaring Forties and wind speed is enough to create a large portion of energy. Currently about two percent of Australia’s energy demand is being met by power created by wind turbines. There are fifty-two wind farms in Australia.

Geothermal

While it might only seem appropriate for those living near volcanic activity, geothermal power is actually viable anywhere you have some space to dig deep. Six feet down, the earth holds a constant of around 50° and 60° all year. By laying some pipes underground, running fluid through a “heat exhanger” – or heat transfer from one medium to another – and adding a compressor to the mix, it is possible to produce a consistent air flow that keeps you cool in the summer months and warm during the winter. To boot, a geothermal heating and cooling system provides better air quality than you get by circulating an A/C or heater.

Shared value: Is there a there there?

If you pay attention to business, strategy and global issues, you’ve surely heard about “shared value.” The idea has been put forth by business guru Michael Porter and consultant Mark Kramer, both Harvard faculty members, most prominently in a January 2011 article in the Harvard Business Review.

They write:

The principle of shared value…involves creating economic value in a way that also creates value for society by addressing its needs and challenges. Businesses must reconnect company success with social progress. Shared value is not social responsibility, philanthropy, or even sustainability, but a new way to achieve economic success. It is not on the margin of what companies do but at the center. We believe that it can give rise to the next major transformation of business thinking.

The purpose of the corporation must be redefined as creating shared value, not just profit per se.

Yes, shared value is being promoted as a big idea, as a way to augment outmoded thinking about corporate social responsibility (CSR), sustainability, corporate citizenship, the triple bottom line, and EHS, even as a way to “reinvent capitalism.” Yikes.

I wish Michael Porter and Mark Kramer much success. Really. They have access to the most powerful CEOs in the world, and the fact that Porter, an enormously influential business thinker, wants to focus on business’s social and environmental impact has to be good.  Why not try to re-frame social and environmental problems as business opportunities?

But I don’t see much, if anything, that’s new here. And I see some danger in substituting the language of  “shared value” for the goal of “sustainability” – a corporate pursuit that is more powerful, more radical and easier to define.

I learned a bit more about shared value today (Nov. 7) at a conference sponsored by the World Environment Center where Kramer spoke. It was hard to argue with anything he said.

“Business, if it wants to redeem itself, if it wants to earn society’s trust, has to demonstrate the positive impact that it’s having,” he told the gathering of corporate execs and NGO leaders. Well, sure. But how?

That “shared value” isn’t new is evident from Porter and Kramer’s own work. The examples they cite of companies that create shared value–GE with Ecomagination, Walmart’s with its sustainability campaign, Mars’ work decoding the cocoa genome–all predate the “shared value” construct. So did the work of management theorist Peter Drucker, who told business school prof David Cooperrider  in 2003: “Every single social and global issue of our day is a business opportunity in disguise.” A Notre Dame business school professor (and Catholic priest) named Oliver Williams put it even more simply to me about a decade ago,  saying that the purpose of business is to “enable human flourishing.” Yes.

Notwithstanding what Porter and Kramer wrote in HBR,  I don’t know of any company that defines its purpose as generating “profit per se.”

An idea like shared value is best understood by seeing what it means in practice. Two companies — Nestle and Royal Dutch Shell — sent executives to the event to talk how about shared value aligns with their strategies.

Nestle’s John Bee talked about how the company has added essential vitamins and minerals to its products, like fortified milk, to address nutrition problems in poor countries. “We’re delivering a social benefit, and we’re delivering double digit growth in markets where we are selling these fortified milk products, for example,” he said.

Shell’s Allard Castelein described the company’s commitment to hiring and training local workers at its oil and gas facilities in Nigeria, about promoting energy efficiency, about its auto-safety programs, and about its support for carbon limits to deal with the climate crisis. Nothing wrong with any of that, but those efforts all sound like conventional CSR.

What’s more, Nestle this year brought Kit Kat bars to Brazil along with fortified milk and Shell’s core business is selling fossil fuels that drive climate change. Nothing wrong with that either–I like chocolate and drive a car–but are those products creating shared value? Who gets to define which social and environmental problems are worth solving? Facebook, iPads, blue jeans, bottled water, candy bars, the dry cleaner, a gas station–don’t these all solve problems and thus create shared value?

After all, any company  that is not solving a problem that matters to people won’t survive for long. That’s what markets are all about.

During a break at today’s event, Mark Kramer told me shared value depends, in part, on intention. Nestle, for example, saw nutrition problems and designed products to solve them. “There’s a difference between solving problems by default and doing it by design,” he said.

Shared value, he went on, means “going above and beyond business as usual, and setting specific objectives.” His nonprofit consulting firm, FSG, is working with Nestle, Intel and Intercontinental Hotels on measuring shared value.

What’s more, it may turn out that companies would prefer to talk about shared value, which emphasizes opportunity, than to talk about CSR, which is more about risk and reputation.

If Porter and Kramer bring more companies into the conversation about solving big global problems, great. Goodness knows we’ve got plenty of problems to solve.

Flying green? Yes, say Alaska and United

Technological progress is impossible to predict, but it’s safe bet that we won’t be flying solar- or wind-powered airplanes anytime soon. So the best hope of flying without emitting large volumes of greenhouse gases lies with biofuels.

This week, there’s good news on bringing biofuels in the air. Beginning Wednesday, Alaska Airlines will fly 75 commercial passenger flights in the U.S. powered in part by biofuels. “This is a historic week for aviation,” declared Alaska Air’s CEO, Bill Ayer, in a press release. Today (Nov. 7), United Airlines make the first U.S. commercial flight using an advanced biofuel made from algae, according to Reuters.

Keith Loveless, vice president of corporate and legal affairs, who oversees sustainability, told me: “These fuels will make a meaningful contribution towards reducing the aviation industry’s environmental impact, and towards reducing fuel volatility, which is an incredible problem for the airline industry.”

But–and you knew there would be a but–biofuels remain way too expensive to replace jet fuels today. That’s why Tom Vilsack, the agriculture secretary, got on the phone with me last week so that the Obama administration will do all it can to advance progress on aviation biofuels. “We are engaged right now in aggressively promoting research to determine the most efficient non-food feed crop that can be used,” he said.

Biofuels remain controversial, of course. The U.S. Senate, in a symbolic vote, overwhelming expressed support last summer for an end to massive corn ethanol subsidies, in what the NRDC’s Nathanael Greene called “a victory for taxpayers and the environment.”

But both the industry and environmentalists say that biofuels for aviation make sense. That’s because the only practical way to dramatically reduce CO2 emissions from planes (other than grounding them) is with biofuels. Plant-based jet fuels emits as much carbon pollution as traditional, petroleum-based jet fuel–indeed, they are chemically almost indistinguishable–growing new plants recaptures those CO2 emissions.

And airplanes matter. Aviation accounts for about  1.5 percent of global man-made GHG emissions per year, and gains in aircraft efficiency have been entirely offset by growing demand for air travel, according to the Pew Center on Global Climate Change.

The industry supports biofuels for business as well as environmental reasons, Loveless told me. Creating an alternative to traditional get fuel will increase supply, drive down costs and reduce price volatility. “We are probably more affected by the price of fuel than any other industry,” he said.

“This will help create jobs in rural America,” Vilsack told me. “It should also save money for the airlines, which will reduce the cost of flying….and it’ll reduce our reliance on foreign oil.”

All true, but let’s remember there’s a long way to go before biofuels become mainstream. According to Loveless, Alaska Air will pay about $17 per gallon for a biofuel made from discarded cooking oil that will replace 20% of the jet fuel on the 75 flights, between Seattle and Washington, D.C., and Seattle and Portland, Oregon. Despite that boost in cost, the environmental benefits of a 20% blend will be modest, according to the airline:

Alaska Air Group estimates the 20 percent certified biofuel blend it is using for the 75 flights will reduce greenhouse gas emissions by an estimated 10 percent, or 134 metric tons, the equivalent of taking 26 cars off the road for a year.

The company also said:

The fuel was supplied by SkyNRG, an aviation biofuels broker, and made by Dynamic Fuels, a producer of next-generation renewable, synthetic fuels made from used cooking oil. The synthetic high-performance airliner fuel made by Dynamic Fuels — a $170 million joint-venture between Tyson Foods Inc. (NYSE: TSN) and Syntroleum Corp. (NASDAQ: SYNM) — meets aviation and military safety, sustainability and performance standards.

United Airlines, meanwhile, is using biofuels to power a flight from Houston (oil country!) to Chicago. According to Biofuels Digest, the fuel produced by Solazyme is a 40/60 blend of sustainable biofuel and traditional petroleum-derived jet fuel. (See my 2010 blogpost, Gee whiz algae! for more on Solazyme.)

To speed adoption of biofuels, Vilsack and the ag department this fall announced a $136 million research program of grants to universities in Washington, Iowa, Louisiana and Tennessee to develop next-generation biofuels from such feedstocks as switchgrass, woody biomass and sugarcane. Separately, the ag department, energy department and the navy have plans to invest up to $510 million in partnership with industry to produce advanced, drop-in biofuels to power military and commercial planes and ships.

Said Vilsack:  “We may have to provide some encouragement [meaning money] at the beginning, until the market becomes a mature market.”

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Two updates: I emailed Jonathan Wolfson, the CEO of Solazyme, to ask him what feedstock was used for the United flight, as well as the cost of the biofuel. He replied that it was made from domestic sugarcane and wrote:

Solazyme sold the fuel to United at current aviation fuel prices. We announced at our IPO in May of this year that we achieved the key performance metrics that we believe would allow us to manufacture oils today at a cost below $1,000 per metric ton ($3.44 per gallon or $0.91 per liter) if produced in a built-for-purpose commercial plant.

I also had an email from a PR woman from Honeywell UOP saying that “the algal oil, provided by Solazyme, was refined into biofuel using process technology from Honeywell’s UOP.”  Here’s more from Honeywell.