Sustainablog

This blog will cover some news items related to Sustainability: Corporate Social Responsibility, Stewardship, Environmental management, etc.

29.4.06

Brazil struggles to put the brakes on rampant deforestation without throwing tens of thousands of loggers and farmers into poverty


The Brazilian Amazon

How green was my valley

Apr 27th 2006 | SÃO PAULO
From The Economist print edition



Brazil struggles to put the brakes on rampant deforestation without throwing tens of thousands of loggers and farmers into poverty


Reuters

Reuters

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“MONSTROUS misery and hunger.” That is the lot of people dwelling in the Amazonian state of Pará since Brazil's government cracked down on loggers and others who earn their livelihoods in the rainforest, says Luiz Carlos Tremonte, who heads a loggers' union. Businesses are idle, thousands are losing their jobs, food aid has not come. The loggers' suffering is no cause for celebration, but to environmentalists the government activism that gave rise to it is.

Brazil loses an average of around 20,000 square kilometres (nearly 8,000 square miles) of rainforest every year. This is because the state lacks the will and the means to control loggers and—more importantly—ranchers, farmers and landgrabbers. This may now be changing. In the year to last August, 19,000km2 of rainforest were destroyed, almost a third less than the 27,000 the year before. “The idea of any country controlling what goes on along an agricultural frontier is completely new,” says Stephan Schwartzman of Environmental Defence, an American NGO.

There are reasons to be wary. Last year's lower rate of deforestation means that the Amazon lost a Kuwait-sized slab of forest rather than nearly a Belgium's worth. This was partly because of a drop in soya and beef prices, the main motors of destruction; when prices bounce back, so may deforestation. The federal government's green contingent is an insecure minority that could be out of office after next October's presidential election. Environmentalism in state governments is even shakier. Yet enough is changing in the way government deals with the Amazon—including new conservation reserves, a new forest law and tougher enforcement—to hope that this marks progress rather than merely a pause in the destruction.

The idea that the Amazon needs saving is relatively new. Mr Tremonte points out that the government once summoned Brazilians to the region to “integrar para não entregar” (integrate the Amazon into Brazil to save it from falling into foreign hands). It remains largely isolated—the main thoroughfares are dirt tracks—but not intact. Nearly 40% of the “legal Amazon”, covering all Amazonian states, consists of protected areas, such as national parks and “indigenous” (Indian) reserves. A quarter is private property, which is supposed to be kept 80% forested but often is not. Most of the rest is unprotected “empty land”, nominally federal property but prey to speculators who assert their claims by despoiling it. Lack of effective ownership often provokes violence: in February 2005, Sister Dorothy Stang, an American nun, was murdered by landgrabbers in Pará.

That prompted the government to send in the army. More effectively, Brazil's president, Luiz Inácio Lula da Silva, has created 150,000km2 of new conservation areas. Earlier reserves were concentrated in remote areas with little attraction for developers. The newest ones stand athwart the “arc of deforestation”—a great swathe of agricultural development, some 400km wide and 3,000km long, that has eaten into the forest—in the hope of discouraging further incursion.

Presidential decrees alone will not disrupt the Amazon's illicit economy, let alone implant a law-abiding and forest-friendly one. That will come from the combined effect of new laws, police operations, regulatory tinkering, institutional reform and pressure by NGOs. Something is happening in most of these areas.

Last year, federal police arrested 148 people in the high-deforestation states of Mato Grosso and Rondônia, a third of them employees of Ibama, the corruption-riddled federal environment agency. Loggers are screaming because the government suspended 3,000 licences to harvest wood on public land. Protocolos—official recognition of a land claim—are now being issued as bar codes rather than as documents similar to title deeds that can be sold or used as collateral for bank loans. That short-circuited the trade in protocolos, a prime tool in land grabbing. As a result, 600,000km2 of land claims have disappeared, says Tasso de Azevedo of the federal environment ministry.




Mato Grosso is better equipped than most states to control deforestation, with a state-of-the-art system for licensing properties and satellite technology to monitor its use. After a purge of the state environment agency, the system is now working well, says André Lima of Instituto Socioambiental, an NGO. But in the areas of enforcement and transparency, there are still problems. Fines are not being paid, nor has the state government put deforestation data on the internet. To encourage enforcement, a group at the Federal University of Mato Grosso plans to report on cases against the 60 largest deforesters.

A federal law passed last month “will change the rationale that leads to deforestation,” says Mr de Azevedo. Under the law, empty land will be preserved as “public forest”. Part of this—due after ten years to total about 3% of the rainforest—will be handed to forest-friendly companies through concessions; 6% will be reserved for harvesting by communities; and 12% will be turned into new conservation areas. A new forest service will manage the concession contracts; private certifiers will check that firms and government agencies are doing their jobs. Mr de Azevedo sees in this the end of a 500-year tradition of seizing and razing the forest.

But this vision is still a long way from being realised. A judicial and political backlash is likely. Despite provisions for “sustainable” forestry, Mr Tremonte is convinced that the government wants to drive loggers out, while Greens grouse that it is not doing enough. Although the environment ministry is eager to control the frontier, other ministries seem unenthusiastic. A recent bailout of struggling farmers, for example, did not require that they obey the environmental law. On the rescue of the Amazon, the government is clearly still of two minds.


Giving credit
Apr 27th 2006 | SÃO PAULO
From The Economist print edition



Rewarding rainforest conservation to help global warming

Get article background

TROPICAL deforestation accounts for a fifth of greenhouse gases emitted by human activity. Yet the Kyoto protocol, which seeks to control global warming, does nothing to discourage it. Carbon credits will be available for planting new forest but not for preserving what is already there. This may change. At a climate meeting in Montreal in November, nine rainforest countries, led by Papua New Guinea and Costa Rica, proposed that countries that reduce deforestation below a given baseline be eligible for carbon credits, which others could then “buy” instead of cutting their own emissions.

The idea seems to be gaining diplomatic traction. It would be a way to set voluntary targets for developing countries, which are now exempt from Kyoto's emission caps. That might encourage rich countries to accept new targets after the current ones expire in 2012. Hard as it is to reduce deforestation, it is easier than changing the way economies burn energy.

Brazil, which had flatly rejected payments for avoiding deforestation, has softened. It has said it will consider incentives, though not carbon credits (which would compete with the nascent business of selling other carbon-reduction projects through Kyoto's “clean development mechanism”). IPAM, a Brazilian research institute that is pressing for another scheme for using carbon credits, calculates that the country could earn nearly $500m a year from them. That would go a long way toward paying for conservation of the Amazon.

Rex Tillerson, the new head of Exxon Mobil, thinks soaring oil prices are no big deal


Texan sangfroid
Apr 27th 2006
From The Economist print edition



Rex Tillerson, the new head of Exxon Mobil, thinks soaring oil prices are no big deal


AP

AP

THESE are dramatic times in the oil business—but you wouldn't know it from speaking to Rex Tillerson, who took over as the head of Exxon Mobil at the beginning of the year. Over the past five months, the price of oil has hit $75 a barrel, Exxon has announced the biggest profits in corporate history, and George Bush has declared his intention to overcome America's addiction to the stuff it peddles. Yet Mr Tillerson claims that none of this upheaval has much bearing on how Exxon is run. The firm will stick to the same strategy, he insists, making the same investment decisions based on the same assumptions about the future of the industry as it did last year. In fact, he goes even further: Exxon's strategy has not changed since 1998, when oil sold for as little as $10 a barrel.

That is quite an assertion at a time when many are arguing that the oil industry is on the verge of a cataclysm. Skittish analysts fear that the big Western firms will run out of oil, or be turfed out of their most lucrative fields by nationalist governments, or see high prices erode demand and stimulate the development of alternative fuels. Even more optimistic souls assume that oil will remain dear for some time to come, justifying lavish spending to develop marginal reserves in difficult terrain. But as far as Mr Tillerson is concerned, this is just the typical hyperbole that always accompanies upswings in oil's boom-and-bust cycle.

As a lifelong oilman, Mr Tillerson should know. He grew up in a former oil boomtown, Wichita Falls, Texas (“the city that faith built”). He has worked for Exxon for the past 31 of his 54 years. In fact, he joined the company straight out of the University of Texas, where he had studied engineering. During the course of his career, he has managed oilfields everywhere from Arkansas to Yemen.

What is more, Mr Tillerson is the chosen successor of Lee Raymond, Exxon's previous boss. Mr Raymond's 12-year tenure was a period of unparalleled success for the company. Its market capitalisation rose from $80 billion to $360 billion, making it the most valuable listed firm in the world. (It has added another $30 billion-odd since Mr Tillerson took over.) Ruthless financial discipline underpins that rise: last year, for example, Exxon earned 31 cents on every dollar it spent, half as much again as its nearest rival, BP. That helps to explain those record profits, of more than $36 billion last year.

Exxon pursues only projects that will turn a profit even in the leanest years, Mr Tillerson explains; so in the fattest ones, the returns are eye-catching. True to that policy, he will not be seduced into making expensive investments on the assumption that the oil price will remain high. Indeed, he assumes the reverse: that it will inevitably fall. Traders, he argues, are pushing the price up on speculation about possible future supply shocks, rather than any actual shortfall. Exxon, after all, refines even more oil than it pumps, yet has never had any trouble buying supplies to feed its refineries.

Anyway, oilfields take so long to develop, and are in production for such a long time, he says, that the oil price of the day, whether high or low, “is almost entirely irrelevant” to investment decisions. So last year, despite the high price, Exxon returned more money to its shareholders than it spent on exploration and development. But in the late 1990s, when the price was in the doldrums, Exxon did the reverse, starting construction on several of the projects that are only now coming onstream in West Africa and the Arctic.

Although the oil price has risen sevenfold in the intervening years, Mr Tillerson claims that the threshold at which Exxon considers a project commercially viable has not budged at all. The firm revisits a scheme that it has previously discarded only if improvements in technology change its economics—not simply because the oil price has spiked.

Despite this choosiness, however, Mr Tillerson maintains that Exxon is not short of opportunities. Far from being shut out of the best real estate by nationalist governments, it is helping to tap the world's biggest gas field in Qatar, and has just signed a deal to develop an oilfield in the United Arab Emirates. Unlike most other Western firms, it recently sold its stake in a Venezuelan field rather than submit to higher taxes—suggesting that it is not desperate for oil to pump. Exxon estimates its total “resource base” of possible, probable and proven reserves at 73 billion barrels, which would last 49 years at the rate it is pumping.

There is a self-serving political element to this line, of course. If Exxon's record profits are the result of years of shrewd and disciplined investment, rather than an unexpected and undeserved windfall, it is harder to argue, as some American politicians have, that they should be taxed away. It is also harder to complain about Messrs Raymond's and Tillerson's record pay.


Untroubled by addiction

By the same token, if there is still plenty of oil in the ground, then there is less reason to worry about America's or any other country's addiction to it. And if there will still be plenty of cheap fossil fuels around in 30 years, then those who are worried about global warming should concentrate on making them cleaner, rather than dabbling in alternatives such as biofuels.

All the same, Mr Tillerson is making a genuine—and risky—choice. Some rivals, such as BP, are piling into renewables such as solar power. Others, including Chevron, have bought rival oil firms despite the cost. Still others, such as Royal Dutch Shell, have rapidly increased their spending on exploration and development. But Mr Tillerson says that he plans to run the company without making any bets on the oil price. That, in itself, is a gamble: if it remains high, and he sticks to his guns, then Exxon will lose ground to its competitors.

Two-Thirds of Industrial Manufacturers Are Absorbing Higher Energy Costs

Two-Thirds of Industrial Manufacturers Are Absorbing Higher Energy Costs


PricewaterhouseCoopers Survey Predicts Rising Energy Prices Will Pose Barrier to Growth


The following findings from PricewaterhouseCoopers’ Manufacturing Barometer, a quarterly survey report, are based on interviews with 60 senior executives of large, U.S. industrial manufacturers about the business climate. This release summarizes results for Q1 of 2006, from interviews conducted through April 14, 2006.



NEW YORK, April 27, 2006— Two-thirds (67 percent) of U.S. industrial manufacturers are absorbing higher energy costs, rather than passing them through to customers, according to PricewaterhouseCoopers’ latest Manufacturing Barometer. These companies predict that energy costs will rise further over the next 12 months, and the majority is concerned that the higher price of energy will serve as a potential barrier to growth.

Sixty-seven percent of industrial manufacturers surveyed by PricewaterhouseCoopers are able to pass along some, very little or none of the increased energy costs. Only 27 percent are able to pass along all or most of the cost (six percent did not report). Overall, 63 percent anticipate further increases in energy expenditures over the next year. The same number - 63 percent - think rising energy costs could hurt the growth of their companies.

In spite of energy concerns, industrial manufacturers remain confident of their financial futures. Those surveyed projected an average revenue growth of 7.8 percent during the next year, due in large part to international prospects. Optimism about the world economy has increased to 77 percent of respondents (versus 71 percent last quarter). Although optimism about the U.S. economy remained high at 67 percent, the number of optimistic respondents decreased by nine points from last quarter.

“The growing optimism about overseas markets likely stems from increased sales in strengthening European and Asian economies,” said Jorge Milo, leader of PricewaterhouseCoopers' U.S. industrial manufacturing practice. “Some companies are probably expecting that the weak dollar will continue to make U.S. exports attractive, while others appear to see local growth opportunities warranting increased operations abroad.”

More than half of companies marketing abroad recorded increased sales last quarter, while only eight percent had a decrease. International marketers now expect sales abroad to contribute 33 percent of their total revenue over the next 12 months – up from 30.7 percent projected last quarter. Thirty-five percent with operations abroad expect to expand to new overseas markets over the next 12 months, and 30 percent are planning new manufacturing or distribution facilities abroad.

Industrial manufacturers reported a decrease in planned investments. Forty-seven percent expect to make major new investments of capital over the next 12 months, down from 57 percent in the prior quarter and 60 percent a year ago. Investments are expected to average 8.4 percent of revenues, versus 9.8 percent in the prior quarter. However, increased investments are expected in three key areas: new product/service introductions (53 percent, up 8 points), research and development (42 percent, up 8 points), and information technology (38 percent, up 6 points).

While revenue projections held steady at 7.8 percent, compared to 7.7 percent last quarter and 6.5 percent a year ago, executives indicated other reverberations from climbing costs. As a group, industrial manufacturers now expect the size of their workforce to decrease by an average of –1.7 percent in the year ahead, a turnabout from the positive growth of 2.0 percent projected last quarter– attributable to several large manufacturers planning sharp employee cutbacks. Currently, 58 percent are planning to increase their workforce over the next 12 months—similar to 61 percent in the prior quarter, and ahead of the 52 percent of a year ago.

“Although strong revenue growth is expected, some industrial manufacturers are taking a more cautious approach concerning investments of capital and human resources, likely due to the lack of stability in energy costs,” said Milo.

Escalating energy prices continue to challenge strong, profitable growth for most U.S.-based industrial manufacturers. Of the nearly two-thirds citing energy prices as a potential barrier, growth was estimated at a 7.3 percent pace, versus 8.8 percent for their peers, or 17 percent slower. Overall, 70 percent say that higher energy prices have had a negative impact on the profit margins of companies in their industry, including 35 percent citing a strong impact, and 35 percent a moderate one.

Despite increased energy costs, three-quarters of respondents were able to either increase margins (35 percent) or at least keep them the same (40 percent) over the past quarter.

“These companies are holding the line or even increasing margins, in spite of escalating energy costs,” said Milo. “They are expecting solid revenue growth, and if they can continue to find new ways of dealing with increasing energy prices, these companies can continue to thrive.”

The full Manufacturing Barometer report is available at www.pwc.com/mb.

PricewaterhouseCoopers’ Manufacturing Barometer is a quarterly survey of executives in large, U.S.-based industrial manufacturing companies that measures opinions on subjects ranging from the domestic economy, barriers to growth, margins and pricing, new investment strategies, hiring plans and business initiatives under consideration. It is developed and compiled with assistance from the opinion and economic research firm of BSI Global Research, Inc.

If you have a question about this Manufacturing Barometer survey, please contact Jim Clayman, Industrial Products marketing director, at 636-405-1672, or e-mail to: jim.clayman@us.pwc.com.

PricewaterhouseCoopers (www.pwc.com) provides industry-focused assurance, tax and advisory services to build public trust and enhance value for its clients and their stakeholders. More than 130,000 people in 148 countries work collaboratively using connected thinking to develop fresh perspectives and practical advice.

"PricewaterhouseCoopers" refers the network of member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity.

PricewaterhouseCoopers' Industrial Products practice is a global network of over 1,000 partners and 17,000 client service professionals who provide industry-focused assurance, tax and advisory services to over 1,000 public and private companies in the aerospace & defense, chemicals, forest & paper, industrial machinery, and metals sectors.


Apple Offers Free Recycling With Mac Purchases


Apple Offers Free Recycling With Mac Purchases

The program begins in June. Apple says it already recycles over 90% of the electronic equipment it has collected since 2001.

By
K.C. Jones
TechWeb.com

Apr 27, 2006 12:00 PM

Apple Computer will take-back and recycle products free with the purchase of a new Macintosh system from an Apple Store. The plan, announced late last week, will begin in June. It comes after the Sierra Club and its investment advisor Forward Management named Apple one of the top 10 environmentally progressive companies.

Apple boasts of recycling more than 90 percent of the electronic equipment it has collected since 2001. The company operates a free drop-off recycling station at its headquarters in Cupertino, Calif. Computer systems and home electronics are recycled domestically.

The fifth-generation iPod, iPod nano and iPod shuffle are completely compliant with upcoming restrictions of hazardous substances in California and Europe, according to Apple, which says it eliminated mercury, cadmium, chromium VI and brominated flame-retardants from the device years ago. iPod power adapters also meet California's strict appliance-efficiency regulations, scheduled to take effect July 1, 2008, the company said through a prepared statement.

Other computer companies, including HP and Dell also tout their recycling and reuse programs, which help cut down on waste.

28.4.06

EU "must end use of oil for transport" - MEPs


EU "must end use of oil for transport" - MEPs

Environment DAILY, 23 March 2006 - The EU must wean its transport sector off oil entirely within a generation, the European parliament's environment committee said this week. In a non-legislative resolution on the European commission's energy efficiency green paper MEPs said the move was essential to ensure the EU becomes the world's most energy efficient economic bloc by 2020.

"The EU's energy strategy should concentrate initially on the total substitution of fossil fuel use in the transport sector by 2030," says the resolution, adopted on Tuesday. The demand will be forwarded to the parliament's energy committee, which is coordinating the assembly's position on the green paper, and then voted on by its plenary session.

Among the measures proposed are "early introduction of an 'energy consumption per kilometre' label" giving consumers a more informed choice between modes of transport. The committee also said the commission's target of a 20% cut in energy use by 2020 should be strengthened because high oil prices meant more cost-effective potential for energy savings.

In other committee business this week MEPs nodded through changes to import quotas for HCFCs in the EU's ten newest member states (ED 28/10/05), and voted their second reading position on the proposed Inspire spatial information system (ED 24/01/06). Both files now go for a plenary vote.

* Meanwhile at a plenary session on Thursday, the full parliament urged EU heads of government gathering in Brussels for their spring summit to redouble efforts to meet existing renewable energy generation targets and to set "ambitious" follow-on targets once they expire in 2010.

Airlines seek to downplay global warming impact of aviation


[Are airlines ready for a fight? Because they might have to get into the ring pretty soon]

Airlines seek to downplay global warming impact of aviation

EurActiv.com, 26 April 2006 - The International Air Transport Association (IATA) wants to "kill some persistent myths" on the issue. Their arguments are rebutted by environmentalists who claim that the figures are biased.

Background:

With air traffic and related greenhouse gas emissions growing steadily, the Commission suggested last year capping CO2 emissions for all airplanes departing from EU airports (EurActiv 27 Sept. 2005). The proposal, expected to be formally tabled later this year, would set a cap on CO2 emissions from airlines and allow them to trade their surplus 'pollution credits' on the EU-wide 'carbon market' (Emissions Trading Scheme, EU-ETS).

Issues:

The UN Intergovernmental Panel on Climate Change (IPCC) estimated in a 1999 report that air traffic contributes to about 3.5% of the total human activities linked to climate change. This share is expected to grow to 5% by 2050.

In Europe, the share of aviation in greenhouse gas emissions is still modest, at about 3% of the total, according to the European Commission. But it is concerned that emissions are growing faster than in any other sector and risk undermining progress achieved through emission cuts in other areas of the economy, mainly in the energy sector and energy-intensive industries.

Positions:

The International Air Transport Association (IATA), which represents the global airline industry, on 25 April issued a 5-point brief aimed at killing what it describes as "some persistent myths" about the environmental impact of aviation.

The five "myths" identified by IATA centre around allegations that air transport is a major source of greenhouse gas emissions. Here are some of the figures that IATA puts forward to "debunk" the myths:

  • Air transport contributes a small part of global CO2 emissions-2%
  • Over the last 40 years emissions per passenger kilometre have decreased by 70%
  • Airline fuel efficiency improved 20% in the last decade
  • 80% of aviation emissions are related to flights over 1,500 km for which there is no alternative mode of transport
The IATA arguments are however contested by the European Federation for Transport and Environment, an environmental NGO. In a point-by-point rebuttal, T&E argues that:
  • The 2% figure refers to CO2 emissions, not other climate impacts such as aviation-induced cirrus clouds
  • The 2% figure is from 1992 which fails to include the explosion in growth of global aviation in the last fifteen years
  • The true global contribution to climate change of aviation is between 4 and 9%, depending on the impact of aviation-induced cirrus clouds
  • Aircraft fuel efficiency has not improved at all. Typical passenger aircraft of the 1950s were as fuel efficient as typical modern jets.
Latest & next steps:
  • First half 2006: Commission expert group to submit report on technical aspects of integrating aviation in EU-ETS
  • End 2006: Commission to table a formal legislative proposal to integrate aviation in EU-ETS. It would have to be adopted by the European Parliament and member states at the EU Council of Ministers, a process which usually takes two to three years
Links

EU official documents

EU Actors positions

Tally puts value of Skeena wild salmon at $110-million annually (Globe and Mail, 03/29/06)


Tally puts value of Skeena wild salmon at $110-million annually (Globe and Mail, 03/29/06)
MARK HUME
 
VANCOUVER -- Wild salmon have long been considered an icon in British Columbia, but until now there have been few hard facts on how much the fish that pour into coastal rivers each year might be worth.


However, in a new study by IBM Business Consulting, the value of wild salmon in the Skeena River system in northwestern B.C. is pegged at nearly $110-million annually.


The study, commissioned by the Northwest Institute and to be released today, bases its conclusion on an analysis of revenue from recreational tourism, sport-fishing, commercial harvesting, wholesale values, added-value processing, retailing, value to natives and values to Alaska. (Many fish are caught in the Gulf of Alaska as they return to spawn in the Skeena.)


Pat Moss, a director of the Northwest Institute, said she hopes the study will help governments as they weigh the often conflicting interests surrounding salmon rivers.


"It's important to finally have some accurate numbers in terms of what the value is in this region," Ms. Moss said in an interview from Smithers.


"So often the numbers are all on the other side of the debate -- forestry, mining -- but now we have numbers of our own to put forward. Now we have some firm numbers to back up our arguments about how important salmon are to this region."


Ms. Moss said the Skeena system, widely considered B.C.'s second-most-important salmon river after the Fraser, is threatened by resource developments, including pipeline construction, logging and mining.


But the biggest immediate concerns, she said, are provincial government plans to approve fish farming pens in the approach waters to the Skeena. In other areas on the West Coast, concerns have been raised about how densely packed salmon in open ocean farm pens can transmit diseases and lice to wild salmon as they migrate past.


Ms. Moss said three salmon farming licences are up for approval at the mouth of the Skeena and 15 more may be proposed.


"Fish farms are obviously the most immediate threat," she said.


"With this study we can now make the argument that we have a very significant, healthy wild salmon fishery here in the Skeena and we should be doing everything that we can to protect it," Ms. Moss said.


The IBM Business Consulting report states that all study numbers represent only direct revenues to the region and that multipliers and other indirect spin-off values have not been calculated.


The study also does not consider many intangibles, such as the value of salmon as feed for wildlife, or the value the fish resource has in attracting people to move to or stay in the area.


Ms. Moss said that, if anything, the $110-million value is low.


"The value attributed to first nations is certainly low, because it doesn't reflect the enormous cultural and social importance salmon have," she said.


The salmon species evaluated are sockeye, pink, chum, coho and Chinook. Steelhead are evaluated under the recreational fishing category.


The study calculates the following annual values: freshwater angling ($9-million); saltwater angling ($6-million); commercial fishing ($13.8-million); fish processing ($32.8-million); added value processing ($8.7-million); salmon-related tourism ($7.6-million); natives ($4.2-million) and Alaska ($27.8-million).


The complete IBM study and methodology can be viewed at:
http://www.northwestinstitute.ca

The Northwest Institute is a non-profit agency with an interest in conservation issues.




High energy prices spur green roofing boom


High energy prices spur green roofing boom

Greenwire, 26 April 2006 - Washington, D.C., is known for green space -- from the National Mall to Rock Creek Park, which meanders through the heart of the city. But some of the city's most interesting green spaces aren't visible at ground level.

Washington has the second-highest expanse of green roof area in North America.

The popularity of green roofs has soared nationally as property owners try to save energy and improve air and water quality. The total area covered by green roofs in the United States grew by 81 percent between 2004 to 2005, to 2.1 million square feet, according to the industry group Green Roofs for Healthy Cities. And that number is likely underestimated, the group said, given the limited number of contractors who participated in the survey.

North American cities ranked by green roof area in 2005:

Rank/City - Square feet

1. Chicago 295,600

2. Washington, D.C. 206,900

3.Suitland, Md.205,000

4. Ashburn, Va. 120,000

5. New York 119,895

6. Culpepper, Va. 100,000

7. Austin 97,384

8. Arlington, Va.96,768

9. Des Moines 94,750

10. Ottawa 84,600

Source: Green Roofs for Healthy Cities.

Among notable green roof projects: Chicago City Hall, completed in 2000; Ford's Rouge Dearborn Truck Plant in Dearborn, Mich.; and a just-announced effort to green Minneapolis City Hall.

The federal government is also getting into the act. The General Services Administration's green roof projects include a 146,000-square-foot planting atop the National Oceanic and Atmospheric Administration's new satellite center in Suitland, Md., and a planned 68,000-square-foot green roof atop the Transportation Department's new headquarters in downtown Washington.

"The benefits of green roofs are undeniable," said Chris Counts, a landscape architect with Michael Van Valkenburgh Associates Inc.

Green roofs differ from roof gardens, Counts said, because they typically use much shallower soil depths -- between 3 and 6 inches -- with an emphasis on lightweight aggregate soils like shale, rather than the rich brown dirt most people are familiar with.

According to U.S. EPA, planting a green roof can reduce a building's roof temperature by up to 90 degrees Fahrenheit on a hot summer day. That cooling often significantly reduces demand for air conditioning, said Nancy Somerville, who heads the American Society of Landscape Architects.

The architect group is set today to unveil its own green roof, atop its downtown D.C. headquarters -- a renovation that is expected to save ASLA up to 15 percent in air conditioning costs, Somerville said.

The cooling effect of green roofs also extends their lifespan, by reducing the temperature fluctuations experienced by roofing materials. Whereas a conventional roof typically lasts for 10-20 years, a green roof can survive 40 years or more, said Counts.

That durability counteracts the higher price of green roofs -- which one study, by the government of King County, Wash., put between $10-$15 per square foot, compared with $3-$9 for a conventional roof.

ASLA's green roof cost the association $1 million, or about $115 per square foot -- a cost elevated by the group's decision to utilize the most advanced technology. But even with that higher cost, the longer life of the green roof should allow the group to avoid two repair cycles it would face with a conventional roof, making the project cost-effective.

"Once you look at the economics of it, you realize it's such a good investment," Somerville said. "Over time, it becomes easier to talk to people about it."

Green roofs can also help reduce the amount of runoff water after rainstorms, a plus for cities like Washington, which has a combined sewer and drainage system that sometimes vents raw sewage during periods of heavy system use.

The bottom line, Somerville said is that "green roofs really have long-term potential for helping cities with lots of their air and water problems. And while green space is at a premium, roofs and buildings are not."

60mph green machine may be the answer to city traffic jams


The Times
April 25, 2006







60mph green machine may be the answer to city traffic jams
By a Correspondent


This three-wheeled vehicle, part-motorbike and part-car, is being hailed as the future of city driving. Called the Clever, it is half the width of a conventional car, can carry a passenger and, as it runs on gas, would be exempt from the congestion charge in London.




It does more than 100 miles (160km) per gallon, three times that of most cars, and emits a third less carbon dioxide. The EU-funded project involved a team from the University of Bath, where it was showcased yesterday. The Clever has a top speed of 60mph and will cost from £5,000 to £10,000 if it makes it into production.

Geraint Owen, a mechanical engineer from Bath university, said that the Clever had been successfully crash-tested. He added: “The next step is to get EU funding to create a batch of 100 of the vehicles for trial in European cities.” Jos Darling, a team member, said smaller vehicles were a solution to the “relentless increase in traffic”.


Solar thermal on the rise in Canada


Solar thermal on the rise in Canada
OTTAWA, April 19, 2006 GLOBE-Net) - A detailed survey of the active solar thermal (ST) industry in Canada shows that installations have increased over 50% during the three-year survey period from 2002-2005. Unglazed liquid collectors, mostly used for swimming pools, represents the largest product area sold in Canada, although glazed and air collectors account for roughly one-third each when measured by revenue totals. In 2004, solar thermal installations contributed to a reduction in 23,200 tonnes of CO2 equivalent.

The survey reveals annual sales of 24.2, 26.4 and 37.5 MWTH in 2002, 2003 and 2004, respectively. These new installations, when added to the approximately 170 MWTH of systems in place at the end of 2001, yields a total of 258 MWTH of operating solar thermal installations in Canada.

The survey was undertaken in the period from January through March, 2005. Its primary focus was to determine the size of the Canadian solar thermal industry and market. This data was then used to derive thermal energy output and avoided greenhouse gas (GHG) emissions from solar thermal systems.

As the first survey of this type in over a decade, the questionnaire was distributed widely, to 268 recipients across Canada. The low participation rate by small retail operations was compensated by participation of the majority of larger businesses. This resulted in obtaining reliable data for analysis, and the results provide a solid base of information on which future surveys can build.

Sales of all collector types grew substantially during the three-year survey period, with 2004 being an excellent year for the industry, with total sales growth of over 40%, in terms of both area and value. Further to this growth, the survey respondents are expecting 20% growth in both 2005 and 2006. Approximately 10% of all sales were exported during 2002 - 2004. The survey confirmed that the markets and applications for different collector types are distinct:

  • Almost all liquid unglazed collectors are sold into the residential sector, for swimming pool heating (97%).
  • The vast majority of air collectors are sold into the industrial/commercial/institutional (I/C/I) sector (90%), with most of these being used for space heating.
  • Sales of liquid glazed and evacuated tube collectors were split between the residential and I/C/I sectors, with approximately 67% in the residential sector. The residential sector sales were primarily for domestic water heating, although in 2004 23% of sales in the residential sector were for combination domestic hot water (DHW) and space heating applications, indicating strong growth in this application. Sales of these collectors into the I/C/I sector were primarily for DHW applications.
Calculations of the greenhouse gas emissions avoided due to active solar thermal systems currently operating in Canada were made based on historical estimates of solar thermal installations, including when systems were decommissioned. A model developed to calculate an operating base, by collector type, from 1979 to the present, shows that the estimated GHG emissions avoided from all active solar systems operating in Canada during 2004 were 23,200 tonnes of CO2 equivalent.

Similar calculations show that the expected avoidance of CO2 emissions, from solar collectors sold and installed in Canada during 2004, over their 20 – 30 year life, will total 122,600 tonnes.

Read the full survey results here (PDF).

Japan developing world's first fuel-cell train: report


Japan developing world's first fuel-cell train: report

AFP, 4 April 2006 - Japan is developing the world's first train to be powered by environmentally friendly fuel-cell batteries, a press report said Tuesday.

East Japan Railway Co., the world's largest passenger railway company, will shortly complete a prototype fuel-cell train for test runs, the Jiji Press news agency said.

The test train will be made up of a single car and carry two 65-kilowatt fuel cells, the report said. It can travel at 100 kilometers (62.5 miles) per hour.

No official was immediately available at the company to confirm the report. Fuel cells produce electricity through a chemical reaction between hydrogen and oxygen, leaving water as the only by-product.

Fuel-cell batteries in cartridges can be easily replaced in contrast to conventional batteries that take hours to recharge.

The company plans to operate fuel-cell trains sometime in mid-2007 on its lines in mountain regions west of Tokyo, the report said. The world's leading carmakers have been developing fuel-cell vehicles which have been hailed for their lower gas consumption.

A Future Without Oil? Once the hydrogen's captured, there's the challenge of transporting and storing it. And people need places to fill up.


A Future Without Oil?

Los Angeles Times, 16 April 2006 - Jon Spallino drives a $1-million car to work. Banish any thought of a flashy red Ferrari. Since June, the Redondo Beach resident has been tooling around in a rather pedestrian-looking, two-door Honda FCX.

What matters is on the inside: hope for a future without oil. The Honda runs on electricity from a hydrogen-powered fuel cell tucked under the seats.

"I was sure I would be giving up something in terms of utility or comfort or performance," Spallino said. "As it turns out, I haven't given up anything."

Spallino is part of an accelerating push toward alternative forms of energy. Researchers and investors -- and President Bush -- are talking hopefully about powering cars and trucks with hydrogen and fuels made from corn, prairie grass, even French fry grease. Despite scientific advances, increased investment and unprecedented political backing, plenty of potholes remain.

The most daunting of those is the magnitude of the task. Cars, trucks, trains, planes and other vehicles account for 7 of every 10 barrels of oil consumed in the U.S.

With such a deep reliance on oil, the transportation world has been nearly impervious to change. Electric-hybrid vehicles are barely a blip, alternative fuels have made only tiny inroads, and a push for more fuel-efficient cars has stalled under the Bush administration.

"In the transportation sector, we've essentially made no progress in the last 25 years," said Daniel Sperling, director of the Institute of Transportation Studies at UC Davis.

Bush's Advanced Energy Initiative, which he promoted in a February tour of research sites, would inject badly needed money into alternative-fuel programs.

Critics say the commitment is paltry. Bush's fiscal 2007 budget seeks about $150 million for biofuels and $290 million for hydrogen-related research. By comparison, the government spends an estimated $150 million a day in Iraq.

But proponents believe the decades of inertia could be broken by a rare convergence of technology, money, political will and motivated motorists.

"I see a broader base of interest and support now than ever before," said James Boyd, a member of the California Energy Commission.

Even the president, a onetime oilman, shifted his stance by declaring in January's State of the Union speech that the country was "addicted to oil" and that it should "move beyond a petroleum-based economy."

Renewable fuels such as ethanol and biodiesel hold the greatest promise of immediately reducing oil consumption because they are available today for use in existing vehicles.

Ethanol is made from organic material such as grain crops, wood chips and agricultural waste. A distillation and fermentation process, similar to what goes on in a brewery, converts corn kernels and the like into ethanol.

The fuel is made from renewable sources, boosts octane levels and pollutes the air less than gasoline does. Regular vehicles can run on gasoline blends of as much as 10% ethanol without changing anything, and the nation's more than 5 million so-called flex-fuel vehicles can use gasoline blends with as much as 85% ethanol.

Government subsidies help keep the cost of ethanol close to that of gasoline, and last year, oil companies blended ethanol into about one-third of the nation's car fuel. In California, ethanol has been widely used as a component of cleaner-burning gasoline since 2004, when the state banned the use of methyl tertiary butyl ether because it contaminates groundwater.

About 4 billion gallons of ethanol were used last year, replacing 170 million barrels of oil. Under a federal mandate, ethanol consumption could almost double by 2012.

"It is the only option we have today in terms of a liquid fuel alternative to gasoline that can be used in the existing distribution system," said Neil Koehler, who has spent half of his 48 years pushing ethanol as a way to loosen crude oil's hold on cars.

Fresno-based Pacific Ethanol Inc., where Koehler is chief executive, recently won an $84-million pledge from Microsoft chief Bill Gates' investment firm. The company plans to open the first of five ethanol plants this year in Madera County.

Still, ethanol is no silver bullet.

Growing corn consumes oil products -- fertilizers and tractor diesel -- and processing equipment runs on natural gas or coal. Ethanol contains less energy than gasoline, so vehicles won't go as far on a gallon of fuel. And ethanol comes with its own air pollution headache -- although much smaller than gasoline's -- because ethanol makes gasoline evaporate more easily, releasing volatile organic compounds, a component of smog.

Today, fuel ethanol is made mostly from corn and other grains in the United States and from sugar in Brazil. But because farm land is limited and those source crops are arguably more valuable as food, experts say the long-term value of ethanol is that it can also be made from plant fibers of all kinds.

Researchers are experimenting with making ethanol from agricultural waste, wood chips and common prairie grasses using enzymes and bacteria. They also are probing termite innards to tap the insect's ability to digest wood. Experts say producing ethanol through those means would use less energy than current methods. But perfecting the process and making it affordable could take as long as six years.

Biodiesel is another alternative fuel gaining momentum.

It is most commonly produced from animal fats or natural oils such as those found in corn and soybeans. Some biodiesel is made from used vegetable oil tossed out by restaurants, giving a vehicle's exhaust the faint smell of fried food.

Production of biodiesel requires simple chemical reactions, which can be carried out in a good-sized refinery or a backyard contraption. The finished product can be sold as is to motorists, but it's more commonly blended into regular petroleum-based diesel in concentrations of 2% to 20% biodiesel. A company backed by country singer Willie Nelson has drawn attention to the fuel by selling BioWillie, a 20% biodiesel blend.

Stephen Flynn is among the converts. More than a year ago, the Valencia resident dumped his gasoline car for a 1996 Chevy Suburban diesel he found on EBay, and he's been filling up with 99% biodiesel ever since. Flynn, a prop master for television commercials, says he goes as much as 500 miles before refueling.

Any diesel engine can operate normally on a low concentration of biodiesel; a high concentration can require minor modifications.

"It runs great and clean," Flynn said. "I don't see any cons."

Biodiesel not only reduces consumption of petroleum-based diesel, thereby cutting harmful vehicle emissions, but also boosts the diesel equivalent of octane and improves lubrication in the engine.

The principal drawback is its expense compared with that of traditional diesel, though the gap has closed substantially with government incentives, tax breaks and the recent rise in diesel prices. In addition, biodiesel can be difficult to find because it is sold at only about 600 filling stations nationwide.

Flynn solved the problem by joining a co-op in West Los Angeles, where members fill up with 99% biodiesel from a self-serve dispensing trailer set up in a leased section of a parking lot. The group's 40 members pay an average of $3.40 a gallon for the fuel, a slightly inflated price to help offset overhead costs, according to co-op founder Colette Brooks.

"I'm not going back, even if I have to make it myself," Flynn said of biodiesel.

The most tantalizing alternative fuel of all is hydrogen. It's abundant, packed with energy, doesn't pollute and can be burned by itself or used to power battery-like devices known as fuel cells.

Hydrogen "has the potential of completely eliminating oil use and drastically reducing greenhouse gases," said Sperling of UC Davis. "It's also the most complex in terms of needing to transform both the energy industry and the automotive industry."

Thanks to a proliferation of experimental programs, there are more than 100 vehicles on U.S. roads powered by hydrogen fuel cells or liquid hydrogen, according to the National Hydrogen Assn.

The Spallinos got one of them because they owned a natural-gas-fueled Honda, demonstrating to the car company that the family's members were adventurous and environmentally conscious. When a Honda representative called to offer them the chance to become "the world's first fuel cell family," Spallino said, they promptly signed up.

"I was interested because it's an alternative to oil ... but also because the environmental benefits of a car that emits just a few drops of water were intriguing to me," Spallino said. Hydrogen gas, stored aboard the car in tanks, flows to a stack of fuel cells that create electricity to drive the engine. Unused water drips from the exhaust.

The family leases the car for $500 a month and must supply critiques of its performance. Spallino uses the FCX to commute to his job as chief financial officer of Southland Industries, an Irvine engineering and construction company.

The roadblocks to the hoped-for hydrogen heyday are considerable. Producers must find cheap and environmentally benign ways to extract hydrogen, and a whole new fleet of cars and fueling stations must be built.

Nearly all of the hydrogen in use today is separated from natural gas using steam and a catalyst. It's the cheapest method but emits some carbon dioxide, a greenhouse gas believed to cause global warming. In addition, using natural gas as a hydrogen source doesn't cut the nation's ties to finite fossil fuels.

Once the hydrogen's captured, there's the challenge of transporting and storing it. And people need places to fill up.

Honda handles refueling for the Spallinos with two hydrogen-making test units in Torrance. One strips hydrogen from water, using electricity collected through solar panels. The other collects hydrogen from natural gas. The Spallinos' car goes about 190 miles before it needs a hydrogen refill. Honda estimates that the price of each fill-up could range from less than 10 cents to 39 cents a mile depending on the process used.

"We should place some bets on hydrogen," said Peter Smith, chairman of the National Assn. of State Energy Officials. But, he added, not at the expense of funding near-term solutions.

"Right now we have the best opportunity we've had in a while," Smith said. "Energy is on the news every day."

*

------

Fueling transport

Cars, trucks, planes and trains consume most of the nation's oil. Sales of alternative vehicles are projected to remain relatively small.

U.S. use of petroleum products by sector

  • Transportation -- 70%
  • Industrial -- 24%
  • Residential -- 4 %
  • Commercial -- 2%
Copyright 2006 Los Angeles Times
All Rights Reserved
Los Angeles Times

26.4.06

Mobile technology - a catalyst for social and economic growth in developing economies


Mobile technology - a catalyst for social and economic growth in developing economies

Keynote speech by Arun Sarin, Chief Executive, Vodafone Group, at the British Museum (London, 20 February 2006)

In this speech (see full transcript below), Vodafone's Chief Executive Arun Sarin announces a commitment of £5 million to the company's Social Investment Fund. The fund facilitates the development of commercially viable products and services with high social value, particularly those that increase accessibility.

One of the products currently in development is M-PESA, which is exploring the potential for mobile to increase access to banking, particularly within developing countries. It allows customers to borrow, transfer and pay money using SMS text messaging. Virtual loan accounts can be accessed by customers through their mobile phones by following text (SMS) instructions.

The value from the virtual loan is then turned into cash through an authorised retailer (either an air-time reseller or a local shop). These retailers effectively act as 'cash points' and receive a commission for each deposit and withdrawal. The customer can also pay for goods and services by an electronic value transfer to suppliers using the same mobile technology.

M-PESA is currently being piloted with 1000 people in Kenya in partnership with the Department for International Development, Vodafone's affiliate Safaricom, the Commercial Bank of Africa and Faulu Kenya, a local micro finance organisation.

A video introduction to M-PESA is available here.

In his speech Mr. Sarin explains further how mobile technology can be a catalyst for social and economic growth in developing economies.

------------------------------------

Full transcript:

In preparation for this talk I looked at some of the other conversations which have taken place in this impressive and imaginative environment. My thanks to Business in the Community and Accenture for inviting me. I am honoured to speak, alongside others such as Sir Martin Sorrel, John Browne, Allun Leighton and Neil Fitzgerald. Their insights, both from a business and cultural perspective, have shed fresh light on the challenging world of global corporations and, guided by Neil MacGregor, have also brought to life treasures from this museum which perhaps we would not otherwise have considered. How then can I augment the discussion?

Communication is my business and in particular the development of different ways to communicate. In our lifetimes this has made the world seem a very small place. Networks and satellites providing 24/7 connectivity now ensure that there is such as thing as real time global news – it’s not the news yesterday that we listen to over our breakfast cereal it’s the news now. If knowledge is power, then modern day communication tools have surely democratised power.

Indeed, the revolution in communications has been such, that at first I thought it challenging to find an historical analogy to use in this context. But as I chatted with Nigel, Richard and Irving it became clear to me that history really does repeat itself – more or less – and that 7,000 years ago a similar sort of revolution took place in the cradle of civilisation itself, Mesopotamia. This was where perhaps the most significant communication tool of all time was first discovered, the written word.

Somewhat unromantically, most scholars now believe that writing began with accountancy. It seems that the compelling demands of an expanding economy stimulated the need to produce written accounts. Administrators in the early cities of Mesopotamia reached a point where memory alone was not sufficient and, in the 4th millennium BC, cuneiform script became part of the arsenal of state governance. Unlike today, change was slow and although writing became a government standard, it took over 1,000 years for the Egyptian poets and people of culture to catch up with the accountants.

Significantly, because it was a tool of government and the elite, only a limited number of people were ever able to write and understand these scripts. The objective was not to share knowledge with everyone but contain it amongst the privileged few. As the dominant powers changed, this “closed shop” approach to the written word fell out of use as Aramaic scripts became more widespread under the invading Assyrian Empire.

Cunieform script, however, was the first step in a long journey to widespread universal communications. But it was the invention of the alphabet that heralded a real step change. The first alphabet was invented over 3,500 years ago in the Near East by the Canaanites. It contained only twenty-two letters. Its relative simplicity meant that it became the model for hundreds of other phonetic alphabets including English, French, Latin, Greek, Latvian, Russian, Romanian, Arabic, Turkish, Persian, Sanskrit, Korean, Hebrew, and Swahili. This was the ultimate communication revolution of the era. The sheer convenience of this form of communication is certain to have assisted the progress of interstate trade in the ancient bazaars and facilitated widespread entrepreneurial activities. It wasn’t all plain sailing however - look at the Rosetta stone. There you see the same message written in three different scripts – a fantastic example of how access to information was limited to different groups in a multicultural society.

It is this transformation in the way people communicated with each other and the consequent blossoming of economic and cultural exchanges which has resonance with the communication revolution we are experiencing today. Developments in communication channels, and access to communications - particularly through the spread of wireless devices in emerging markets, provide similar opportunities to those which were on offer in the ancient world, more than 5,000 years ago.

So, let me jump to our own age. Connectivity to a wider world, first “one way” through traditional print and broadcast media and more recently, interactively via the internet, through email and via the telecoms networks, has for the first time given everyone, irrespective of location or economic status, the opportunity to exploit the benefits of communication networks. This ability to interact has, in turn, expanded market boundaries and opened up information flows.

In the West, for example, it has taken less than twenty years for mobile phones to have gone from being rare and expensive pieces of equipment used by the business elite to become a pervasive, low-cost personal item. Many of us cannot leave home without our mobiles and often have a personal and a business phone. This means that in some markets, including the UK, where the number of mobile phone sales outstripped that of cars as early as 1998, there
is over 110% mobile ownership.

The trend looks set to continue. The roll out of the 3G network provides a significant increase in voice capacity and data rates. Mobile phone customers can now take pictures, and videos, send pictures, browse branded entertainment, listen to audio files, watch video clips, play games and customise ring tones with their favourite songs. There is also a strong business benefit to mobile technology. The freedom to communicate whilst on the move enables us to be more responsive, more productive and fundamentally more organised. Mobile applications are also evolving – you can now vote, confirm medical appointments, receive location advice and make payments from your handset.

So much for the West. What of developing economies such as those in Africa, India and South America? It is here that the impact of mobile technology has had the most dramatic effect.

As a global organisation, with interests in Democratic Republic of Congo, Lesotho, Mozambique, Tanzania, Kenya, Egypt, China and most recently India and Turkey, we have a clear need to understand the economic and social impact of our technology in developing markets. This is not for altruistic purposes - we have no desire to undertake the role of governments or NGOs or embrace an exclusively philanthropic approach to “do good”. Rather we recognise that around 20% of the world’s mobile phone users are from low to middle income countries and can see that the next billion mobile phone users are likely to live in markets which have very different needs from those we are used to.

The first cellular call in Africa was made in Zaire in 1987. Now there are more than 52 million mobile users in the continent (compared with 25 million fixed lines) and mobiles account for at least three quarters of all telephones. This extraordinary jump, 5000% between 1998 and 2003, is due mainly to the relatively low cost of rolling out a mobile network in comparison to that of a fixed line network. This means that Africa has seen faster growth in mobile telephone subscriptions than any other region in the world over the last 5 years; mobile phone usage in Nigeria for example grew 143% between June 2003 and June 2004. India is not far behind; its sheer size means it is the largest mobile market in Asia with 65.1 million customers despite low penetration levels.

A mobile network is peculiarly suited to roll out in a developing market. It is more flexible than a fixed line system as it can be easier to deploy and can therefore adapt to the challenges of an inadequate infrastructure or difficult geographical terrains. Other benefits for operators include early pay-back on investment when compared to fixed line; in India it is up to six times lower than the estimated $1,000 variable cost per additional fixed line. For customers, on the other hand, the flexibility offered by sharing handsets and the pre-pay business model helps to overcome credit barriers.

But what does this actually mean in socio-economic terms? We commissioned a report on the impact of mobile phones in Africa, which was published in March last year. It identified that between 1996 and 2003, a country which has an average of 10 more mobile phones per 100 population has enjoyed a per capita GDP growth that is 0.6% higher than an otherwise identical country. This is twice the size of the growth impact of mobiles in developed countries.

Put simply I believe that mobile technology has enabled people whose views and needs were previously unheard to be active participants in the market place – looking back to Egypt much like the invention of pen and ink must have given the opportunity to expand trading networks.

By providing access to information about products and services consumers in developing markets can exercise choice in their buying power. The value of this, something that we in the West take for granted, is demonstrated by the amount consumers in developing countries spend on connectivity - at least 2% of the monthly expenditure. In fact, in 2004 in a sample of Indian villages it was 3%; in Bangalore it was up to 7%; and in Chile poor people spend more of their incomes on telecommunications than on water and electricity combined.

Access to information not only influences what people buy but also how they sell, thus driving economic growth and stimulating entrepreneurial activity. Research shows for example, that fishermen in India use mobile phones to find out which port is offering the best prices before deciding where to land their catch. Mobiles also provide security with direct economic benefits – talk to the maize farmers in the Democratic Republic of Congo who have provided phones to security guards and now say that the reduction in looting has had a positive impact on yields. Social capital, or the strength of social networks and contacts in rural communities have benefited from increased access to mobile technology. The Africa research showed a clear majority of respondents said owning a mobile had improved their relationship with family members living elsewhere. This in turn led to a positive correlation between mobile phone ownership and life satisfaction and a willingness to help others.

One of the most important findings of the Africa report is that it is wrong simply to extrapolate our developed world models of needs and usage patterns to poorer nations. Take texting as an example. In the UK the number of outgoing voice calls made to the number of text messages is 0.6:1; in South Africa as a whole the ration is 3:1 for pre pay phones; and in rural communities the average ratio is 13:1. Text messages are cheaper than phone calls so this data, looked at from a western perspective, seems surprising. However when considered in the context of a community where a significant number of people are illiterate it is more understandable. The combination of illiteracy and indigenous languages clearly has dramatic effects on the use of text messaging and may have further implications on other types of written usage, for example the Internet. It is this sort of learning which has helped us to drive usage using different propositions from those we offer in Europe for example.

The easy and personal access to communication provided by mobile technology can drive sustainable economic growth and build social capital. It is with this in mind we have launched a Social Investment Fund which focuses on the development of products and services which have both social and business benefit. The fund, which as far as I am aware is the first of its kind in the telecoms industry, enables us to use our technical expertise on areas which have a direct impact on people with identifiable social needs. I am fully supportive of this initiative and have committed in excess of £5 million to support its growth over the next 3 years.

One of the first products in development is MPesa, a solution for mobile banking. The project is currently being piloted in Kenya in partnership with the Department for International Development, the Bank of Central Africa and Faulu, a local micro finance organisation.

Mpesa allows customers to borrow money and use their mobile phone much like a bank and a debit card. In countries where a banking infrastructure does not currently exist outside the main cities and where carrying cash can, quite literally, be a life threatening experience, the benefits of this system are obvious. Mpesa, if successfully managed, could provide banking services to millions of people who otherwise have no access to conventional retail banking. Working with microfinance institutions stimulates entrepreneurial activity and brings people into the economy. It is also of benefit to the banking industry as it offers a cost effective mechanism to access a new market place. It’s a great example of the flexibility and potential of mobile
technology.

And there are other Microfinance initiatives. We have also introduced airtime transfer systems in Egypt, Kenya, South Africa and Albania. These provide the ability for customers to give airtime to one another. This means for example that the primary wage earner can “top up” his or her family’s credit even if they are separated – a situation which is all too common in developing markets. Incidentally, airtime transfer also has a direct benefit to small businesses because it allows them to have effective control on usage.

This brings me almost full circle to our friends in Mesopotamia and the development of the alphabet. I am sure the scribes managing the salary of their workforce, or writing the terms of a trade agreement had no concept of the way in which writing would evolve to produce beautiful works of art, such as the Dead Sea Scrolls or the poetry of Shakespeare. In some ways we are in the same position. We cannot predict all the applications that our customers will want in the next 5 years. But we can listen to them and learn from them. We can therefore anticipate their needs and in response build the infrastructure and platforms. The opportunity which providing access to communications presents is in creating real, relevant benefits for all our customers. We cannot, however, take the credit for all the innovations - that honour belongs to our customer - they are the true champions of modern communications technology.

Developing a supplier’s Code of Conduct: Hewlett-Packard


Developing a supplier’s Code of Conduct: Hewlett-Packard

Hewlett-Packard, headquartered in Palo Alto, California, is a technology solutions provider to consumers, businesses, and institutions. It operates in 178 countries and employs approximately 160,000 people across the globe.

This case study describes how a technology company developed a Human Rights and Labor Policy within their Global Citizenship strategy, and is engaged in the complex and unclearly defined issues of human rights within their business. The case also describes ongoing development and challenges, and examines how the company has been implementing the United Nations Global Compact, specifically the principles that deal with human rights.

The company contractually obliges its top 40 suppliers to commit to HP's supply chain code of conduct. This includes 100 sites and accounts for 80% of HP’s spent dollars. HP is in the process of increasing the number of suppliers it requires making this commitment and strengthening the means by which it ensures compliance with the obligation. Eventually, this code of conduct will be explicit in all new supplier contracts, so compliance will be a necessity to do business.

In developing its supply chain code of conduct, HP did its own extensive benchmarking and research, and worked with Business for Social Responsibility, a think tank and consultancy around CSR based in San Francisco, California. The Director of Supply Chain Services stated that HP scoured the landscape of supplier codes of conduct, looked at the various international standards, even looked at the UN Global Compact- but none were satisfactory or entirely relevant to HP. So it developed its own code.

The "HP Supplier Code of Conduct" professes to focus on compliance with local laws in the areas of environment, worker health and safety, and labor and employment practices, and in intended to work in conjunction with management systems to measure, improve and communicate progress in these areas. The treatment of labor issues is fairly comprehensive and, despite the use of headings that refer to compliance with local laws, contains standards, for example, in relation to non-discrimination and prison labor, which may or may not be covered by local legislation. The focus on these issues is positive and its effectiveness will be greatly enhanced by the planned improvements in compliance monitoring. To meet HP's human rights obligations, the supplier code of conduct should be expanded to cover human rights matters beyond labor issues, matters such as:

  • Performance and monitoring of security guards by suppliers;
  • The impact on the local community of supplier operations;
  • The penalization of suppliers for corrupt or human rights-abusive regimes.
Currently, HP monitors its supply chain using a self-assessment questionnaire completed by HP's top 40 suppliers. HP then works collaboratively with suppliers to achieve the required standards in any area that is identified as falling below HP requirements. HP's Director of Supply Chain Services reports that HP's suppliers take this process very seriously given the importance to them of their relationship and business with HP. HP is moving to expand and strengthen their supply chain monitoring. They are extending self-assessment beyond the top 40 suppliers to the suppliers HP regards as "high risk".

At the same time it is strengthening the monitoring of the top 40 suppliers by utilizing HP's own procurement auditing capacity to conduct site assessments of supplier performance, moving beyond the self-assessment model. In time, this model will also be extended to the high-risk suppliers. Finally, HP is currently researching appropriate entities to conduct third-party assessment of supplier performance. Selective third party assessment will be the final stage in the evolution of supply chain monitoring at HP.

This case study is part of Raising the Bar: Creating Value with the United Nations Global Compact. Designed to help companies understand the Global Compact framework and its principles, Raising the Bar is the only publication that provides a catalog of available tools and implementation guidelines that companies can use to implement the Compact’s principles.

Further information

In search of responsible market leadership: Article by Mallen Baker


* In search of responsible market leadership

 Article by Mallen Baker

 Corporate social responsibility remains a disputed term, but
 increasingly it is now defined by how businesses make money, not just
 by how they give some of it away. What we have lacked to date has been
 any kind of framework to map out what the objectives of responsibility
 in the marketplace should be.

 Over a year ago, Business in the Community brought together a group of
 senior business leaders - the Marketplace Taskforce - to address the
 issue. The group has now produced a draft set of marketplace
 principles which are out for consultation.

 The issues are defined into four overall themes, which are effectively
 about different kinds of relationships that the business has in this
 sphere.

 The first theme relates to the rules of the marketplace. There is no
 such thing as a free market. Everything is regulated to some extent,
 and the impact of market activity is shaped or mis-shaped as a result.
 Of course, businesses are therefore key stakeholders of the lawmakers,
 and consequently lobby for how those rules should be framed. This can
 range from negative, purely short-term self interest, or indeed for
 seeking to promote progressive solutions that will help the market to
 deliver the best social outcomes. In addition, there are questions
 about how companies behave in environments where some fairly basic
 rules are either absent or not enforced, and there is something as
 well about corporate culture. A monopolist business may operate within
 the letter of the law, but is there something about how companies
 operate within the spirit of fair competition as well?

 The second theme is about the relationship with the customer. Within
 this area, you are talking about basic respect for the customer, both
 in terms of providing honest and accurate information, marketing with
 integrity and honouring your promises. It also includes issues around
 customers that may be unusually vulnerable in some way, either to
 interruption in the supply of the product, or to exposure to the
 product. Examples might include solvent abusers for aerosol
 manufacturers, or people living in poverty for retailers of essential
 utilities such as energy or water.

 The third theme focuses on the relationship with the supplier, both in
 terms of risk down the supply chain relating to labour or human rights
 but also in terms of fair treatment of suppliers. Obviously, this is
 one area where there is a great many existing initiatives and
 activities. However, there remains by common consent a great deal of
 progress still to be made in finding solutions to the problems of
 audit-led processes. And the second aspect remains the most elusive.
 In recent months in the UK, several retailers generally seen to be
 leaders in supply chain risk management have unilaterally imposed
 unfavourable terms on their suppliers - one extending their terms of
 payment to 90 days, the other shaving off 10 percent from the prices
 they will pay suppliers in future.

 The final theme focuses on impacts on third parties of products or
 services. When you drive a car, it produces emissions which contribute
 to an overall impact on the health of people that never took part in
 your decision to buy that car or indeed to drive it. That is about the
 inherent impact of the product - used as described on the tin. There
 is also, of course, the possibility of mis-use or abuse of the
 product. Addiction or anti-social use is an example of this, or indeed
 easy susceptibility to theft (the mobile phone companies were heavily
 criticised for being slow to build in security to their phones, for
 instance).

 The Marketplace Principles make the starting point assertion that
 businesses do better when they proactively manage these issues. It can
 be the difference between being a confident market leader, or being
 perpetually on the back foot, surprised by every criticism and
 controversy.

 Consequently, the draft Principles lay out 8 very simple aims covering
 the issues. In the simplest possible terms, these are:

 (i) Work with the rule makers
 (ii) Have consistent standards
 (iii) Respect your customers
 (iv) Support vulnerable customers
 (v) Actively manage responsibility in your supply chain
 (vi) Treat suppliers as partners
 (vii) Manage the impact of product use
 (viii) Mitigate the effects of product misuse

 In addition to these, along with the commentary that expands each of
 them, the Principles contains a number of management behaviours that
 are proposed as improving the likelihood of success in these areas.
 The CSR movement has been guilty in the past of proposing activities
 without clarity about what constitutes skill in execution. In this
 area, however, there must be just as many ways to get this wrong as
 there are to get it right, and the reputational risk is high since
 this is where many of the really controversial issues live.

 So the eight management behaviour seek to frame what should improve
 success in this area. In simplest form, these behaviours are:

 (i) Be consistent
 (ii) Anticipate trends
 (iii) Skill in execution
 (iv) Core to business strategy
 (v) Parts of the culture
 (vi) Reward the right behaviour
 (vii) Mainstream not niche
 (viii) Share within the business

 Some are easier than others to achieve. The 'be consistent' point
 draws from some of the learnings of the Collins / Porras 'Built to
 Last' research, which identified that enduringly great companies were
 built on a consistent base of values that remained within the company
 regardless of the comings and goings of the person at the top. For
 every genuinely values-driven company you can find, you'll find ten
 others that have a statement on the chairman's wall, and yet those
 values make no difference to how people make decisions within the
 business. Can you do responsible things in the absence of a
 values-culture? Of course you can - but you can't guarantee that the
 corporate entity will do responsible things next year, or the year
 after, or in its operations in Vietnam - because it is purely down to
 the integrity of individuals not the group as a whole. But to create a
 genuinely values-driven culture is not a small or easy task.

 The consultation continues until July this year, both with invitations
 for responses to the draft Principles document, and a series of
 UK-based senior executive breakfasts. There is also a detailed series
 of case studying being undertaken to test some of the assumptions
 against real life best practice. The final official Marketplace
 Principles will be published and launched in September.

 Interested to feed back into the consultation, or to find out more
 about the process? You can download a copy of the Principles from
 http://www.bitc.org.uk/marketplace or from the resources section of
 the mallenbaker.net website.


Sweden Goes for Green as Nordics Mull Energy Future


Sweden Goes for Green as Nordics Mull Energy Future

STOCKHOLM - Twenty years after Sweden alerted the world to the meltdown at Chernobyl, it aims to phase out nuclear power and end dependency on fossil fuels, putting the country in the vanguard of green energy policy.

With soaring oil prices, rising demand, uncertain supply and the need to cut greenhouse gas emissions, energy is in focus and the European Union is calling for coordinated policy.

But the Nordic region -- united by history, a shared concern for the environment and a harsh climate which puts heavy demand on power -- is divided on energy, not least nuclear power.

When a reactor at a nuclear plant in the Ukrainian town of Chernobyl exploded in 1986 and spewed radioactivity across Europe, the Nordic region was on the front-line: its pristine lakes and forests were polluted and Arctic reindeer meat and lichen contaminated.

Long before radiation on a Swedish power worker's shoes alerted the world to history's worst nuclear accident, Sweden had voted to get rid of atomic energy, in a 1980 referendum.

It now aims to break with fossil fuels by 2020, when it also wants greenhouse gas emissions, blamed by many for global warming, cut by 25 percent against 1990 levels.

"We have to transform into a non-oil economy," said Stefan Edman, who heads the Swedish government's oil dependency panel. "We have very high ambitions, although I don't think it is realistic that not a drop of oil will be used in 2020."

Sweden has already cut oil use in home heating by 70 percent in the last 20 years and has kept consumption flat in industry since 1994, despite a 70 percent increase in production.

The big challenge will be to do something about oil used in the transport sector, where it accounts for 98 percent of energy used, said Professor Christian Azar at Chalmers University of Technology in Gothenburg, also on the oil panel.

"If we could achieve a 50 percent reduction, that would be an enormous achievement."

While worries about oil prices and supply and climate change are major drivers, the government also hopes that environmental technology will be a money-spinner for Swedish companies.

"Sweden has a chance to be an international model and a successful actor in export markets for alternative solutions," said Mona Sahlin, minister for sustainable development.

"The aim is to break dependence on fossil fuels by 2020. By then, no home will need oil for heating. By then, no motorist will be obliged to use petrol as the sole option available. By then, there will be better alternatives to oil."

Sweden produces around 35 percent of its energy from oil and with nuclear power on the way out, finding alternative power sources is a priority.


DIFFERENT STROKES

In Finland, however, nuclear power is seen as part of the future and its fifth atomic power plant -- the first built in Europe for more than a decade -- is due to come online in 2009.

"The main reason was increasing demand for energy," said Anneli Nikula, spokesman for private power generation firm Teollisuuden Voima, which owns the new power plant.

Finland does not want to rely on neighbours Russia, Sweden and Norway for power and has many old fossil fuel plants which have to be replaced in order to meet climate change goals.

"Cutting down carbon dioxide emissions has sparked debate on nuclear energy in many European countries," said Nikula. "The second coming of nuclear energy is true."

In Norway and Denmark, atomic power has never been an option.

In the 1970s, when other Western nations were building nuclear plants, Norway started developing the vast oil and gas reserves that make it the world's third biggest oil exporter behind Saudi Arabia and Russia.

But the fact that hydropower dams still generate almost all the nation's electricity has dampened environmental concerns.

Controversy surrounds opening up new areas of the Arctic for oil exploration, and using natural gas to supplement hydropower to meet growing demand. But opposition to nuclear power is so entrenched that the centre-left government did not even mention it when outlining its policies on taking office in October.

"Nuclear power is not an option for Norway", Oil and Energy Minister Odd Roger Enoksen told Reuters.

Denmark -- home to Vestas, the world's largest wind turbine maker -- hopes use of sustainable sources such as wind and biofuels will reach 36 percent by 2025, from 25 percent in 2003.

It also uses oil and gas from its North Sea fields and the government's 20-year energy plan emphasises keeping that industry competitive.

Iceland also aims to become the world's first oil-free nation, setting its sights on 2050, by shifting cars, buses, trucks and ships over to non-polluting hydrogen.

By then, in theory, the only oil used on the volcanic North Atlantic island would be in planes. About 70 percent of energy needs are already met by geothermal or hydropower -- only the transport sector is still hooked on oil.

For all these countries, the speed of change will depend on the price of oil. As Azar at Chalmers Unversity put it: "The political momentum will drop as fast as the oil price."

(Additional reporting by Laura Vinha and Terhi Kinnune in Helsinki, Alister Doyle in Oslo, Kim McLaughlin in Copenhagen)

Story by Simon Johnson

Story Date: 24/4/2006


Free Email Goes Green - New Webmail Service Powered by Renewable Energy


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Free Email Goes Green - New Webmail Service Powered by Renewable Energy
Download this press release as an Adobe PDF document.

Free email services are nothing new, but Portland based web hosting company ThinkHost, Inc. has recently launched a service with a twist - free webmail accounts powered by 100% renewable energy.

Portland, OR (PRWEB) April 24 2006 - Free email services are nothing new, but Portland based web hosting company ThinkHost, Inc. has recently launched a service with a twist - free webmail accounts powered by 100% renewable energy.

The new service, CommunityMail.net (
http://www.communitymail.net), is one of the very few email providers offering environmentally conscious consumers with a totally free and green webmail alternative.

ThinkHost's Executive Director, Vladislav Davidzon, explains. "Given our expertise in web hosting, our solid history of sponsoring community oriented projects and utilizing renewable resources wherever possible in our business, it seemed a natural extension to develop CommunityMail.net. What's most pleasing to us is that we are able to offer this environmentally friendly webmail service to all; absolutely free of charge."

CommunityMail.net, powered by wind and solar derived energy sources, offers subscribers a choice of domain names for their free email address: communitymail.net, activist.cc, hippiemail.com and globalupgrising.com - with more to be added soon. Unlike some of its non-green counterparts, CommunityMail.net subscribers are not subjected to banner advertising in their account interfaces.

Among the many features of the CommunityMail.net service is a calendar, user controlled spam filtering, encryption, anti-virus protection, task scheduler, address book and a powerful HTML editor; presented in a familiar Outlook style interface.

The calendar, address book and task scheduler are particularly useful features for groups, as items can be easily shared with other CommunityMail.net users. Once an item is entered, the subcriber simply enters in the email addresses of other CommunityMail.net subscribers whom they wish to share the item with - those entries will then appear in the relevant application in the specified accounts.

A free green lifestyle newsletter is also under development as part of the CommunityMail.net service which will provide subscribers with tips and news articles related to environmentally friendly living.

"Just as we've demonstrated with our premium web hosting operations, which are also powered by renewable energy, we're hoping the popularity of CommunityMail.net is noticed by other free email providers. Not just noticed, but that those companies seriously consider the option of more earth-friendly derived energy sources for their own services.", states Mr. Davidzon.

"Our message to them is that there really is no excuse for not utilizing green electricity sources given the revenue levels they generate from their ad-ladened services. Aside from that, we are very excited about building a thriving community of like-minded people via CommunityMail.net; people who understand that caring for our planet extends very much so into our activities in the online world".

###

Sudan and South Africa: A tale of two divestment movements


Sudan and South Africa: A tale of two divestment movements
EC Newsdesk
23 Apr 06

Other nations, such as Chad, are now being dragged into Sudan's conflict
Other nations, such as Chad, are now being dragged into Sudan's conflict


The time has come for divestment from companies doing business in Sudan, argues Peter Kinder
Last July Illinois required its public pension funds to sell the securities of companies doing business in Sudan.

Since then, three states have followed suit, and another five seem likely to in 2006.

Meanwhile, public and private college endowments from New England to California have ordered divestment.

Many commentators have equated the Sudan and the South Africa divestments. In fact, the cases for the two are more different than similar.

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But those differences – in the countries involved, their economic importance and the nature of the conflict – only make imperative the case for Sudan divestment.

The perpetrators


A clear difference between the two divestment movements lies in their targets: the ultimate perpetrators and the types of companies doing business with them.

Apartheid benefited a white ruling class that was western in ancestry but separated from former colonial influence, integrated into the post WW II global economy and vulnerable to the pressures of public opinion and trade sanctions, particularly with major trade partners like the UK, Germany and the US.

Between one-third and one-half of the S&P 500 in 1980 did business of some sort in South Africa.

In contrast, the Sudan regime resembles North Korea’s in its political and social insularity. Sudan is already cut off from much of the world’s economic activity.

So, trade sanctions have much less prospect for success than they did with South Africa. Only oil and gum arabic give it global resource significance.

Less than a dozen S&P 500 companies have a presence in Sudan. Most of the 130 or so publicly-traded companies doing business there are Asian.

Their governance structures offer limited opportunities for engagement of the type and scale that characterized the anti-apartheid campaigns.

Most significantly, even with former Liberian and Rwandan leaders facing prosecution for crimes against humanity, the Sudanese junta is so unfazed by the prospect that it does little to hide its ethnic cleansing.

Hence, engagement of any sort holds little promise.

Conflict's duration


One argument often heard against Sudan divestment is that it’s coming too soon. After all, it took 15 years for South Africa divestment to become a serious option in the mid-1980s.

And that arose after huge efforts had gone into coalition-building, education, corporate and endowment engagement, and the like.

The time scales are different. Apartheid took its mature form in the early 1950s. It did not attract general concern in the West until the early 1970s, despite the writings of Alan Paton and the sermons of Bishop Trevor Huddleston.

In 1994 after a generation of activism, apartheid ended relatively peacefully with democratic elections and a new Bill of Rights.

In contrast, state-sponsored killing of its own people began in Southern Sudan about 22 years ago when civil war broke out. Today its focus lies in the western province of Darfur.

But, the difference in durations loses meaning when one thinks of the relative brevity of Rwanda and the Balkans.

It means nothing when one compares the causes of the South Africa and Sudan divestment campaigns.

Apartheid vs. Genocide


At the state level, apartheid is to genocide as, at the individual level, discrimination is to murder.

Apartheid and discrimination demand intervention and remedies. Genocide and murder command immediate intervention and justice. Neither has been forthcoming for the people of Sudan for 22 years.

And hence the great difference between South Africa divestment and Sudan divestment: their objectives.

In the South Africa campaign, the objective was to force internal reform through external pressure – financial, social, and moral...

In the Sudan campaign, the objective is to mobilize governments and interested companies to stop the killing.

No model suggests success in Sudan without extreme pressure on its government. Divestment is a significant part of bringing that pressure to bear.

Divestment now


So why divest companies in Sudan? Boston Globe columnist Alex Beam once wrote:

“There is an old, politically incorrect saying in newsrooms: How do you change a front-page story about massive flood devastation into a 50-word news brief buried inside the paper? Just add two words: "In India."

Sudan divestment will help keep the genocide ‘above the fold,’ which is where it should be.

With South Africa – especially until the late 1980s, some argued in good faith that apartheid was a transitional stage that would wither away in the face of the liberalizing effects of capitalism and the world economy. One can’t make the same argument for genocide.

Peter Kinder is president of KLD Research & Analytics, Inc.
www.KLD.com

Britain urges global carbon trading to spur eco-healthy growth


Britain urges global carbon trading to spur eco-healthy growth

AFP, 20 April 2006 - Britain's finance minister Gordon Brown on Thursday made a strong pitch for a global carbon trading market as the best way to protect the endangered environment while spurring economic growth.

In a speech at the United Nations focusing on the environmental challenge, the chancellor of the exchequer, citing his country's experience, said: "The innovation of carbon trading offers us a way to reinforce economic and
environmental objectives simultaneously."

He said he would urge the powerful Group of Seven club of nations in Washington Friday "to discuss not only how we ensure greater security of energy supply but support alternative sources of energy and greater efficiency of energy use, so reducing carbon emissions is an energy and thus an economic imperative as much as it is an environmental imperative."

The G7 ministers and central bank chiefs will meet before the World Bank and the International Monetary Fund hold their annual spring meetings over the weekend in the US capital.

"Carbon saving can be a way of making money and increasing returns on investment," Brown said. "It makes economic opportunities of a climate-friendly energy policy real and tangible."

Brown cited Britain's progress in cutting carbon dioxide emissions by 15 percent to 18 percent below 1990 levels by 2010, exceeding the 12.5 percent target under the Kyoto protocol.

The Kyoto protocol sets legally binding targets for developed countries to reduce emissions of carbon dioxide and other gases blamed for global warming by 2012.

Britain's plans call for stricter emission caps on industry, steps to encourage use of biofuels, tighter building regulations, and measures to improve household energy efficiency.

Brown said London was now proposing that to extend and strengthen a European Union-wide carbon reduction scheme beyond 2012.

He said efforts were under way to link it with other initiatives around the world, including in the United States, Australia, Canada and South Korea to "make it the driver for a deep, liquid and long-term carbon trading system."

"Our ultimate goal must be a global carbon market" to make the environment "a driver of future economic growth."

However he made it clear that a global consensus for environmental change required all countries to share in the benefits from action to address it.

"For this to happen, developed countries must be prepared to support, with public investment, through grants or loans, developing countries in their efforts," Brown said.

In this respect, he said he would propose to the G7 Friday a "new public-private partnership, a World Bank-led facility, a 20-billion (16.5 billion euros) dollar fund for developing economies to invest in alternative sources of energy and greater energy efficiency."

"I believe it is by providing in these ways for a flow of public and private investment funds for developing countries that we will be able to bring these countries into the global consensus on climate change that I am calling for today," he said.

He said that new alternative energy technologies, for instance, could not only help meet Africa's growing needs but also develop new exports to the rest
of the world.

He recalled that during his African tour last week, Britain began discussions with Mozambique and South Africa on a new partnership with Brazil, the world's largest producer of renewable biofuels, on how to make southern Africa a leader in biofuels output as well.

Global wind power capacity predicted to soar


Global wind power capacity predicted to soar

Environmental Finance, 20 April 2006 - Wind energy generation will storm ahead in the next four years, with North America leading the way, according to a report by the Global Wind Energy Council (GWEC).

In 2005 alone, 11.5GW of wind generation capacity was installed worldwide, bringing the total up to 59.1GW - an increase of 24% on the previous year.

"According to our forecast, wind power will continue to grow rapidly, at an average rate of 18% per year up to 2010," says Arthouros Zervos, Chairman of GWEC. "This will take the total installed capacity up to 134.8GW worldwide by 2010."

The Europe Union was still the leading market in 2005 with 40.5GW of installed capacity, but its dominance in the coming years will diminish as North American and Asian capacity soars.

GWEC predicts an annual growth rate of 24% in North America, rising from 9.8GW at present to 29.1GW of installed capacity by 2010.

Asia is not far behind, with GWEC forecasting 23.5% annual growth, taking capacity up to 20.1GW. India will continue to lead the continent, followed by China and Japan. South Korea and Taiwan will also emerge as serious players, GWEC says.

However, Europe's offshore market is only expected to take off on a large scale towards the end of the decade, giving new momentum to European developments after 2010. Meanwhile, Germany remains the world leader with 18,428MW of capacity.

The Global Wind 2005 Report is the first in a series of annual reports by the Council on the status of the world's wind energy markets. The 52-page document can be found here.

Top Business Schools Partner on Environmental, Health, and Safety Award


Top Business Schools Partner on Environmental, Health, and Safety Award
Source:
GreenBiz.com

ITASCA, Ill., April 18, 2006 - The Wharton School of the University of Pennsylvania, McAfee School of Business in Jackson, Tenn., and Whittemore School of Business and Economics at the University of New Hampshire have partnered to sponsor a new international business award for environmental, health, and safety (EH&S) management.

The Robert W. Campbell Award, co-founded by the National Safety Council and Exxon Mobil Corporation, recognizes companies that successfully integrate EH&S management into their overall business operations.

"We are thrilled to have renowned schools such as these share our vision that EH&S management become an intrinsic and necessary part of doing business," said Mei-Li Lin, Ph.D., National Safety Council Director of Research and Statistical Services. "Through our partnerships with business schools, we hope to influence current and future managers in their understanding of the role that safety, health and environmental concerns play in the productivity and sustainability of their organizations."

The case study from the first winner of the Campbell Award, Nobel Corporation -- a Texas-based oil and gas drilling contracting company -- was developed into a business school case study similar to those published by Harvard Business School. Through collaboration with Georgetown University's McDonough School of Business, the winning Campbell Award case study was incorporated into Georgetown's curricula as well as several other business and engineering school's in North America.

"The integration of the Nobel business case study into those curricula is an example of how the Campbell Award promotes the sharing of knowledge, the education of future business leaders, and encourages worldwide dialogue of best practices that promote safety and health while improving business," added Lin.

The Robert W. Campbell Award draws on global partners to provide worldwide outreach and support for environmental, health, and safety initiatives and foster collaborations that support the purpose and vision of the Robert W. Campbell Award. In addition to the Wharton School, McAfee School of Business and the Whittemore School of Business and Economics, these global partners include:

  • The Conference Board (Worldwide)
  • International Safety Council (Worldwide)
  • International Social Security Association (Worldwide)
  • Consultora Leais (Argentina)
  • National Safety Council of Australia LTD (Australia)
  • Industrial Accident Prevention Association (Canada)
  • Minerva Canada (Canada)
  • Foundation for the Regional Center for Occupational Safety and Health, FUNDACERSSO (Central America)
  • China Occupational Safety and Health Association (China)
  • Occupational Safety and Health Council, Hong Kong SAR (China)
  • Colombian Safety Council / Consejo Colombiano de Seguridad (Colombia)
  • BG Chemie (Germany)
  • National Safety Council of India (India)
  • Korea Occupational Safety and Health Agency (Korea)
  • Center for Environmental Safety and Health Technology (Taiwan)
  • McDonough School of Business, Georgetown University (USA)
For more information, or to apply for the award, visit the award Web site. The deadline for 2006 applications is June 30, 2006.

More News...

25.4.06

Why the world is not about to run out of oil: the new era of manufactured fuel will further delay the onset of peak production


The oil industry

Steady as she goes

Apr 20th 2006 | BAKERSFIELD, CALIFORNIA, AND CALGARY, ALBERTA
From The Economist print edition



Why the world is not about to run out of oil


Getty Images

Getty Images

IN 1894 Le Petit Journal of Paris organised the world's first endurance race for “vehicles without horses”. The race was held on the 78-mile (125km) route from Paris to Rouen, and the purse was a juicy 5,000 francs. The rivals used all manner of fuels, ranging from steam to electricity to compressed air. The winner was a car powered by a strange new fuel that had previously been used chiefly in illumination, as a substitute for whale blubber: petrol derived from oil.

Despite the victory, petrol's future seemed uncertain back then. Internal-combustion vehicles were seen as noisy, smelly and dangerous. By 1900 the market was still split equally among steam, electricity and petrol—and even Henry Ford's Model T ran on both grain-alcohol and petrol. In the decades after that great race petrol came to dominate the world's transportation system. Oil left its rivals in the dust not only because internal-combustion engines proved more robust and powerful than their rivals, but also because oil reserves proved to be abundant.

Now comes what appears to be the most powerful threat to oil's supremacy in a century: growing fears that the black gold is running dry. For years a small group of geologists has been claiming that the world has started to grow short of oil, that alternatives cannot possibly replace it and that an imminent peak in production will lead to economic disaster. In recent months this view has gained wider acceptance on Wall Street and in the media. Recent books on oil have bewailed the threat. Every few weeks, it seems, “Out of Gas”, “The Empty Tank” and “The Coming Economic Collapse: How You Can Thrive When Oil Costs $200 a Barrel”, are joined by yet more gloomy titles. Oil companies, which once dismissed the depletion argument out of hand, are now part of the debate. Chevron's splashy advertisements strike an ominous tone: “It took us 125 years to use the first trillion barrels of oil. We'll use the next trillion in 30.” Jeroen van der Veer, chief executive of Royal Dutch Shell, believes “the debate has changed in the last two years from 'Can we afford oil?' to 'Is the oil there?'”

But is the world really starting to run out of oil? And would hitting a global peak of production necessarily spell economic ruin? Both questions are arguable. Despite today's obsession with the idea of “peak oil”, what really matters to the world economy is not when conventional oil production peaks, but whether we have enough affordable and convenient fuel from any source to power our current fleet of cars, buses and aeroplanes. With that in mind, the global oil industry is on the verge of a dramatic transformation from a risky exploration business into a technology-intensive manufacturing business. And the product that big oil companies will soon be manufacturing, argues Shell's Mr Van der Veer, is “greener fossil fuels”.

The race is on to manufacture such fuels for blending into petrol and diesel today, thus extending the useful life of the world's remaining oil reserves. This shift in emphasis from discovery to manufacturing opens the door to firms outside the oil industry (such as America's General Electric, Britain's Virgin Fuels and South Africa's Sasol) that are keen on alternative energy. It may even result in a breakthrough that replaces oil altogether.

To see how that might happen, consider the first question: is the world really running out of oil? Colin Campbell, an Irish geologist, has been saying since the 1990s that the peak of global oil production is imminent. Kenneth Deffeyes, a respected geologist at Princeton, thought that the peak would arrive late last year.




It did not. In fact, oil production capacity might actually grow sharply over the next few years (see chart 1). Cambridge Energy Research Associates (CERA), an energy consultancy, has scrutinised all of the oil projects now under way around the world. Though noting rising costs, the firm concludes that the world's oil-production capacity could increase by as much as 15m barrels per day (bpd) between 2005 and 2010—equivalent to almost 18% of today's output and the biggest surge in history. Since most of these projects are already budgeted and in development, there is no geological reason why this wave of supply will not become available (though politics or civil strife can always disrupt output).

Peak-oil advocates remain unconvinced. A sign of depletion, they argue, is that big Western oil firms are finding it increasingly difficult to replace the oil they produce, let alone build their reserves. Art Smith of Herold, a consultancy, points to rising “finding and development” costs at the big firms, and argues that the world is consuming two to three barrels of oil for every barrel of new oil found. Michael Rodgers of PFC Energy, another consultancy, says that the peak of new discoveries was long ago. “We're living off a lottery we won 30 years ago,” he argues.

It is true that the big firms are struggling to replace reserves. But that does not mean the world is running out of oil, just that they do not have access to the vast deposits of cheap and easy oil that are left in Russia and members of the Organisation of Petroleum Exporting Countries (OPEC). And as the great fields of the North Sea and Alaska mature, non-OPEC oil production will probably peak by 2010 or 2015. That is soon—but it says nothing of what really matters, which is the global picture.

When the United States Geological Survey (USGS) studied the matter closely, it concluded that the world had around 3 trillion barrels of recoverable conventional oil in the ground. Of that, only one-third has been produced. That, argued the USGS, puts the global peak beyond 2025. And if “unconventional” hydrocarbons such as tar sands and shale oil (which can be converted with greater effort to petrol) are included, the resource base grows dramatically—and the peak recedes much further into the future.


After Ghawar

It is also true that oilmen will probably discover no more “super-giant” fields like Saudi Arabia's Ghawar (which alone produces 5m bpd). But there are even bigger resources available right under their noses. Technological breakthroughs such as multi-lateral drilling helped defy predictions of decline in Britain's North Sea that have been made since the 1980s: the region is only now peaking.

Globally, the oil industry recovers only about one-third of the oil that is known to exist in any given reservoir. New technologies like 4-D seismic analysis and electromagnetic “direct detection” of hydrocarbons are lifting that “recovery rate”, and even a rise of a few percentage points would provide more oil to the market than another discovery on the scale of those in the Caspian or North Sea.

Further, just because there are no more Ghawars does not mean an end to discovery altogether. Using ever fancier technologies, the oil business is drilling in deeper waters, more difficult terrain and even in the Arctic (which, as global warming melts the polar ice cap, will perversely become the next great prize in oil). Large parts of Siberia, Iraq and Saudi Arabia have not even been explored with modern kit.

The petro-pessimists' most forceful argument is that the Persian Gulf, officially home to most of the world's oil reserves, is overrated. Matthew Simmons, an American energy investment banker, argues in his book, “Twilight in the Desert”, that Saudi Arabia's oil fields are in trouble. In recent weeks a scandal has engulfed Kuwait, too. Petroleum Intelligence Weekly (PIW), a respected industry newsletter, got hold of government documents suggesting that Kuwait might have only half of the nearly 100 billion barrels in oil reserves that it claims (Saudi Arabia claims 260 billion barrels).

Tom Wallin, publisher of PIW, warns that “the lesson from Kuwait is that the reserves figures of national governments must be viewed with caution.” But that still need not mean that a global peak is imminent. So vast are the remaining reserves, and so well distributed are today's producing areas, that a radical revision downwards—even in an OPEC country—does not mean a global peak is here.

For one thing, Kuwait's official numbers always looked dodgy. IHS Energy, an industry research outfit that constructs its reserve estimates from the bottom up rather than relying on official proclamations, had long been using a figure of 50 billion barrels for Kuwait. Ron Mobed, boss of IHS, sees no crisis today: “Even using our smaller number, Kuwait still has 50 years of production left at current rates.” As for Saudi Arabia, most independent contractors and oil majors that have first-hand knowledge of its fields are convinced that the Saudis have all the oil they claim—and that more remains to be found.

Pessimists worry that Saudi Arabia's giant fields could decline rapidly before any new supply is brought online. In Jeremy Leggett's thoughtful, but gloomy, book, “The Empty Tank”, Mr Simmons laments that “the only alternative right now is to shrink our economies.” That poses a second big question: whenever the production peak comes, will it inevitably prompt a global economic crisis?

The baleful thesis arises from concerns both that a cliff lies beyond any peak in production and that alternatives to oil will not be available. If the world oil supply peaked one day and then fell away sharply, prices would indeed rocket, shortages and panic buying would wreak havoc and a global recession would ensue. But there are good reasons to think that a global peak, whenever it comes, need not lead to a collapse in output.

For one thing, the nightmare scenario of Ghawar suddenly peaking is not as grim as it first seems. When it peaks, the whole “super-giant” will not drop from 5m bpd to zero, because it is actually a network of inter-linked fields, some old and some newer. Experts say a decline would probably be gentler and prolonged. That would allow, indeed encourage, the Saudis to develop new fields to replace lost output. Saudi Arabia's oil minister, Ali Naimi, points to an unexplored area on the Iraqi-Saudi border the size of California, and argues that such untapped resources could add 200 billion barrels to his country's tally. This contains worries of its own—Saudi Arabia's market share will grow dramatically as non-OPEC oil peaks, and with it the potential for mischief. But it helps to debunk claims of a sudden change.

The notion of a sharp global peak in production does not withstand scrutiny, either. CERA's Peter Jackson points out that the price signals that would surely foreshadow any “peak” would encourage efficiency, promote new oil discoveries and speed investments in alternatives to oil. That, he reckons, means the metaphor of a peak is misleading: “The right picture is of an undulating plateau.”

What of the notion that oil scarcity will lead to economic disaster? Jerry Taylor and Peter Van Doren of the Cato Institute, an American think-tank, insist the key is to avoid the price controls and monetary-policy blunders of the sort that turned the 1970s oil shocks into economic disasters. Kenneth Rogoff, a Harvard professor and the former chief economist of the IMF, thinks concerns about peak oil are greatly overblown: “The oil market is highly developed, with worldwide trading and long-dated futures going out five to seven years. As oil production slows, prices will rise up and down the futures curve, stimulating new technology and conservation. We might be running low on $20 oil, but for $60 we have adequate oil supplies for decades to come.”

The other worry of pessimists is that alternatives to oil simply cannot be brought online fast enough to compensate for oil's imminent decline. If the peak were a cliff or if it arrived soon, this would certainly be true, since alternative fuels have only a tiny global market share today (though they are quite big in markets, such as ethanol-mad Brazil, that have favourable policies). But if the peak were to come after 2020 or 2030, as the International Energy Agency and other mainstream forecasters predict, then the rising tide of alternative fuels will help transform it into a plateau and ease the transition to life after oil.

The best reason to think so comes from the radical transformation now taking place among big oil firms. The global oil industry, argues Chevron, is changing from “an exploration business to a manufacturing business”. To see what that means, consider the surprising outcome of another great motorcar race. In March, at the Sebring test track in Florida, a sleek Audi prototype R-10 became the first diesel-powered car to win an endurance race, pipping a field of petrol-powered rivals to the post. What makes this tale extraordinary is that the diesel used by the Audi was not made in the normal way, exclusively from petroleum. Instead, Shell blended conventional diesel with a super-clean and super-powerful new form of diesel made from natural gas (with the clunky name of gas-to-liquids, or GTL).

Several big GTL projects are under way in Qatar, where the North gas field is perhaps twice the size of even Ghawar when measured in terms of the energy it contains. Nigeria and others are also pursuing GTL. Since the world has far more natural gas left than oil—much of it outside the Middle East—making fuel in this way would greatly increase the world's remaining supplies of oil.

So, too, would blending petrol or diesel with ethanol and biodiesel made from agricultural crops, or with fuel made from Canada's “tar sands” or America's shale oil. Using technology invented in Nazi Germany and perfected by South Africa's Sasol when those countries were under oil embargoes, companies are now also investing furiously to convert not only natural gas but also coal into a liquid fuel. Daniel Yergin of CERA says “the very definition of oil is changing, since non-conventional oil becomes conventional over time.”

Alternative fuels will not become common overnight, as one veteran oilman acknowledges: “Given the capital-intensity of manufacturing alternatives, it's now a race between hydrocarbon depletion and making fuel.” But the recent rise in oil prices has given investors confidence. As Peter Robertson, vice-chairman of Chevron, puts it, “Price is our friend here, because it has encouraged investment in new hydrocarbons and also the alternatives.” Unless the world sees another OPEC-engineered price collapse as it did in 1985 and 1998, GTL, tar sands, ethanol and other alternatives will become more economic by the day (see chart 2).




This is not to suggest that the big firms are retreating from their core business. They are pushing ahead with these investments mainly because they cannot get access to new oil in the Middle East: “We need all the molecules we can get our hands on,” says one oilman. It cannot have escaped the attention of oilmen that blending alternative fuels into petrol and diesel will conveniently reinforce oil's grip on transport. But their work contains the risk that one of the upstart fuels could yet provide a radical breakthrough that sidelines oil altogether.

If you doubt the power of technology or the potential of unconventional fuels, visit the Kern River oil field near Bakersfield, California. This super-giant field is part of a cluster that has been pumping out oil for more than 100 years. It has already produced 2 billion barrels of oil, but has perhaps as much again left. The trouble is that it contains extremely heavy oil, which is very difficult and costly to extract. After other companies despaired of the field, Chevron brought Kern back from the brink. Applying a sophisticated steam-injection process, the firm has increased its output beyond the anticipated peak. Using a great deal of automation (each engineer looks after 1,000 small wells drilled into the reservoir), the firm has transformed a process of “flying blind” into one where wells “practically monitor themselves and call when they need help”.

The good news is that this is not unique. China also has deposits of heavy oil that would benefit from such an advanced approach. America, Canada and Venezuela have deposits of heavy hydrocarbons that surpass even the Saudi oil reserves in size. The Saudis have invited Chevron to apply its steam-injection techniques to recover heavy oil in the neutral zone that the country shares with Kuwait. Mr Naimi, the oil minister, recently estimated that this new technology would lift the share of the reserve that could be recovered as useful oil from a pitiful 6% to above 40%.

All this explains why, in the words of Exxon Mobil, the oil production peak is unlikely “for decades to come”. Governments may decide to shift away from petroleum because of its nasty geopolitics or its contribution to global warming. But it is wrong to imagine the world's addiction to oil will end soon, as a result of genuine scarcity. As Western oil companies seek to cope with being locked out of the Middle East, the new era of manufactured fuel will further delay the onset of peak production. The irony would be if manufactured fuel also did something far more dramatic—if it served as a bridge to whatever comes beyond the nexus of petrol and the internal combustion engine that for a century has held the world in its grip.


Power politics: Critics of Tony Blair's plans for a nuclear revival make their case


Power politics
Apr 20th 2006
From The Economist print edition



Critics of Tony Blair's plans for a nuclear revival make their case

Get article background

AFTER 25 years in the political wilderness, nuclear power is back in favour in Britain. A combination of dwindling fossil-fuel stocks in the North Sea, rising greenhouse-gas emissions and a high oil price pushed Tony Blair into launching an energy review last year to re-examine an issue that his government last looked at as recently as 2003. Most observers think the review is designed merely to rubber-stamp a nuclear revival that the prime minister has already decided on in private.

Support is far from universal. In the past month, two influential bodies have produced reports arguing against a renewal of nuclear power. Last month it was the Sustainable Development Commission, an independent outfit created to advise the government on greenery. Over the Easter weekend, the Environmental Audit Committee (EAC), a parliamentary body, weighed in with its own criticisms.

The committee's first worry is the time it takes to build nuclear-power generators. Around a quarter of Britain's generating capacity is due to disappear over the next ten years, as elderly nuclear plants are decommissioned and new environmental rules make coal stations more expensive to run. The MPs argue that, given the long lead time on new nuclear plants, they could not begin to make a contribution until 2019. That would be too late to bridge the likely generation gap.

Their next worry is that support for atom-splitting might, in the meantime, mean less help for other low-carbon technologies like wind and wave power, or carbon capture and storage. That could leave Britain dangerously reliant on imported gas for much of its electricity supply.

Such crowding-out is inevitable, say the MPs, because nuclear power would require big subsidies to make it attractive to investors. That is because nuclear power plants—which have high initial capital costs and take a long time to start up and shut down—are risky in Britain's volatile, privatised electricity markets, which favour cheaper, nimbler technology (such as gas generation) better able to meet rapid changes in demand. A long period of cheap power could cripple a nuclear operator, as British Energy (which owns Britain's newer nuclear plants) found when the government was forced to bail it out in 2003. The EAC cites a study by Oxera, an economics consultancy, which estimated that at least £1.6 billion ($2.9 billion) of public money might be needed to ensure 8GW of new investment and replace the losses from decommissioning old reactors.

The costs of nuclear power extend far beyond a reactor's operating life, too. The Nuclear Decommissioning Authority, set up last year to dismantle Britain's nuclear power stations, now reckons that the total cost to the taxpayer of running down, decommissioning and cleaning up Britain's civil nuclear sites will be around £70 billion over the next century—up from its initial guess of £56 billion.

But not everyone agrees that atomic energy requires public money. Ministers say they remain committed to liberalised markets and insist that new reactors will have to be privately financed. William Vereker of Lehman Brothers, an investment bank, argues that financial markets will take the risk of building, running and decommissioning new nuclear plants so long as the state provides non-monetary support in a few areas—such as expediting planning applications (the planning process for Sizewell B, Britain's last nuclear plant, lasted six years) and deciding what to do with nuclear waste.

A few companies—notably E.ON, a German electricity generator—have expressed tentative interest in building reactors in Britain. Atom aficionados point out that the market is currently rigged in favour of renewable energy sources, since the Renewables Obligation, the government's main subsidy for carbon-free power, does not apply to nuclear energy. Changing that, they argue, would improve the finances of the nuclear option.

Mr Blair might also take heart from polling evidence that suggests the public is warming to a nuclear revival. A MORI poll for the Nuclear Industry Association published in December 2005 found 41% in favour of building more reactors to replace existing ones, up from 35% a year before.

Nostalgia for calmer days: Oil uncertainty looks a bigger problem than high prices.


The oil market

Nostalgia for calmer days

Apr 20th 2006
From The Economist print edition



Uncertainty looks a bigger problem than high prices



HOW high can the oil price go? It is striking that so many people are even asking the question—let alone answering it, in some cases, with frightening triple-digit numbers. For most of the 1980s and 1990s, the oil price rarely strayed far from $20 a barrel. With the exception of a brief interlude following Iraq's invasion of Kuwait in 1990, the world grew used to the joys of cheap oil. But over the past four years, the price has more than tripled, to more than $70 a barrel. It is still climbing and prices in the futures market imply that oil will remain dear for several years to come. Clearly, investors believe that some comfortable old certainties have gone out of the window.

Chief among them is the idea that Saudi Arabia will always act to cap prices. The Saudis have many decades-worth of oil left in the ground, and so have an incentive to keep the stuff cheap enough to ward off conservation or substitution. To this end—and to help its protectors in Washington, DC—the kingdom used to maintain spare pumping capacity of a few million barrels a day, enough to deal with an unexpected surge in demand or a sudden cut in supply. During the first Gulf war, for example, Saudi Arabia turned on the taps to compensate for the loss of Iraq and Kuwait's normal output. But as demand has grown over the past few years, particularly from booming places like China, supply has not kept pace, so Saudi Arabia's buffer has gradually worn through. For the first time in more than two decades demand is straining at capacity.

A freer oil market is no bad thing. In time, higher prices will lead to conservation—a bonus in a world worried about global warming (though one better achieved through taxes). In addition, oil firms should respond to higher prices by redoubling their efforts to procure more of the stuff. And so they are: by one estimate, 15m barrels of new capacity should come onstream by 2010 (see article). Moreover, despite a lot of scaremongering, the geological evidence suggests that there is still plenty of black gold in the ground.

The hitch is that the most promising territory for exploration lies in unstable places such as the Middle East and Russia. What is more, the oil is controlled by state-owned firms, which often seem blind to the signals sent by the market. While the supply remains tight any political or meteorological hiccup in a producing country (and there always seems to be at least one) will resonate through the markets.

Three other factors will add to the uncertainty. The first is the flood of new speculative investment in commodities, especially oil. Speculators are thought to have put more than $100 billion into commodities markets in the past few years, helping to propel the price of oil ever higher. But this new hot money could quit the oil market in an instant, causing prices to plunge (and throwing the energy industry's investment plans into disarray).

The second unknown is how expensive oil will affect the world economy. Past surges in the oil price have led to rises in inflation and interest rates that have triggered recessions. This time might be different, partly because growing demand, rather than a reduction in supply, has underpinned the price rise. That means it has been steady and gradual, giving consumers more time to adjust. In addition, inflation remains low and oil exporters are supporting consumption in the United States, the biggest importer (see article). Dearer oil will eventually curb demand—but at what price, and at what cost to the world economy, nobody knows.


Making oil

In the long run, the biggest uncertainty is technology. Western oil firms are beginning to address their difficulty in finding oil by manufacturing fuel instead. Man-made fuels, such as ethanol derived from plants, or diesel conjured from coal and gas, hold out the promise of secure and almost unlimited supply. But with today's technology these are much more expensive to produce than oil pumped from the deserts of Arabia. Until that changes, the oil market is set for an unnerving period.


NYT - The Greenest Generation (by Thomas Friedman)


Thanks to Laurie and Abu for forwarding on this one




21 April 2006, A25

The Greenest Generation
By THOMAS L. FRIEDMAN

I was visiting Williams College a few days ago and heard a student speaker there mention that at the end of the day, she had gone back to her dorm room to study and to ''do it in the dark.''

Hey, I thought, I'm not a prude, but did she have to be so explicit -- and in public, in front of parents no less?

Fortunately, I quickly discovered that ''doing it in the dark'' is not some new sexual escapade, but a new Williams energy-saving competition in honor of Earth Day. Student dorms, classrooms and campus buildings are pitted against one another to see who can save the most energy. Students are encouraged to turn off lights every time they leave a room, to unplug cellphone chargers when not in use, to take advantage of daylight to study or use precise task lighting at night (''Do it in the dark!''), and to change old light bulbs to compact fluorescents.

The Williams competition got me thinking. Why doesn't every college make it a goal to become carbon-neutral -- that is, reduce its net CO2 emissions to zero? This should be a national movement. After all, today's students will be profoundly affected by climate change, the coming energy wars and the rising danger of petro-authoritarian states, such as Iran. Yet on most campuses, the whole energy-climate question still seems to be a student hobby, not a crusade.

C'mon kids, wake up and smell the CO2! Everybody -- make your school do it in the dark! Take over your administration building, occupy your university president's office or storm in on the next meeting of your college's board of trustees until they agree to make your school carbon-neutral. (And while you're at it, ban gas-guzzling G.M. Hummers from your campus as well!)

It is not that hard. Start by measuring exactly how much energy your university is consuming and how much CO2 it is emitting, from its heating and cooling of buildings to its transport systems. The Greenhouse Gas Protocol, which can be downloaded from www.ghgprotocol.org , offers an internationally accepted way to measure greenhouse gas emissions.

Once you determine your university's total CO2 emissions, the next step, suggests Glenn Prickett, a senior vice president at Conservation International, should be to have ''your own graduate students in science and engineering develop their own comprehensive plan to reduce fossil fuel consumption.'' They can turn to more efficient lighting, heating and cooling; more hybrid vehicles; and better building design, including renewable energy technologies like solar panels.

After a college reduces its carbon emissions as much as possible, it can then develop a strategy for offsetting the greenhouses gases it is still putting into the atmosphere. To become carbon-neutral, you need to finance a project that will measurably reduce greenhouse gases, and it has to be a project that would not have happened if your school had not paid for it. That's how you get the credit.

You can pay to preserve rain forest land in the Amazon so trees there will not be burned, a major source of greenhouse gases, or plant forests in Africa that will absorb carbon, or sponsor a project to turn landfill gas into electricity. (G.M. does that!) In a partnership with Conservation International, the band Pearl Jam offset all the emissions from its last tour by paying to help communities preserve rain forest land in Madagascar. (That also helps reduce poverty and protect endangered wildlife.)

''Our offices are carbon-neutral,'' said Jonathan Lash, president of the World Resources Institute, which is ready to advise any campus on how to proceed: call (202) 729-7600. ''We worked through a broker and identified a school in Portland that needed to buy a new heating system because the old one was very inefficient and created a lot of greenhouse gas.'' The institute helped pay for the new system, the school saved money and reduced its emissions, and W.R.I. got the offset for its own emissions.

Al Gore eloquently argues that our parents' generation, the Greatest Generation, turned back the black tide of fascism. They fought the war and built the institutions that preserved peace and freedom for a lot of people on this planet. Today's young people, Mr. Gore argues, have a parallel task. Yes, he means you college students.

You need to become what the writer Dan Pink calls ''the Greenest Generation,'' and build the institutions, alliances and programs that will turn back the black tide of climate change and petro-authoritarianism, which, if unchecked, will surely poison your world and your future as much as fascism once threatened to do to your parents' world and future.

This is your challenge. Who will rise to it?