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


Ethical and environmental issues can affect investment performance

Ethical and environmental issues can affect investment performance
EC Newsdesk
4 Jul 06

Investment analysts need better information on ethical risks

Investment analysts are increasingly aware of the positive impact of social, ethical and environmental issues on businesses, but more and better research is needed, say Rory Sullivan and Craig Mackenzie
There is a growing belief that investors, in particular large institutional investors, have a responsibility to work proactively to address the environmental and social impacts of their investments.

One strategy that has been proposed is that investors should explicitly take account of social, ethical and environmental issues (SEE) in their investment analysis.

The basic argument is that, collectively, the financial analysis and investment decision making of stock-market participants sets the share price for companies.

Share prices, in turn, affect company behaviour, both directly by affecting the cost of capital, and indirectly by motivating boards and executive behaviour.

If investment analysis fails to place sufficient weight on the value of good corporate social and environmental performance or on the costs of poor performance, then the capital markets may create incentives for companies to cause harmful corporate impacts on society and the environment.

The more that financial analysts focus on these issues, the stronger the signals will be for company executives to reduce their harmful social and environmental impacts.

This raises the question of whether or not a focus on SEE issues can enhance investment performance. In many ways, however, the question is misconceived.

Impact on revenue

It is very clear that SEE issues can and do affect company earnings through a number of mechanisms.

– Government intervention: command and control regulation and economic instruments such as the European Union's Emissions Trading Scheme for greenhouse gas emission.

– Litigation seeking redress for harmful corporate impacts: eg asbestos litigation.

– Damage to stakeholder relationships and to brand and reputation: eg concerns about the use of sweatshop labour in the apparel and footwear industries.

– Direct impacts: eg higher insurance premiums associated with climate change.

– Changing patterns of consumer behaviour: eg demand for healthier foods.

To the extent that these issues are major drivers of earnings, investment analysts have an interest in understanding them, and in understanding the quality of companies' responses.

Expressing this argument another way, ignoring material information about corporate earnings is rarely a sensible investment strategy.

Our experience in discussing this topic with analysts and fund managers is that very often they do have access to information about major SEE issues, and give due weight to this information in investment decision-making.

For example, we have found that analysts are well aware of the financial implications of issues such as impending environmental regulations, tobacco litigation and major sources of reputation damage.

This awareness is simply because analysts follow companies closely and have a good understanding of material earnings drivers.

While it should be relatively uncontroversial to suggest that paying due regard to information about material SEE issues ought to deliver better investment performance than failing to pay due regard to this information, this suggestion does not necessarily mean that more focused or enhanced analysis will deliver even better performance.

Already there?

It is possible that the capital markets are already efficient at taking account of this kind of information and, as a consequence, it is possible that all the analysis that can productively be done on these topics is already being done.

If this is the case, focussing even more resources on SEE issues will not enhance investment performance.

However, not all SEE issues are recognised and properly valued by the markets. This is illustrated by the case study (below) which illustrates how major policy developments - in this case, the European Union's Registration, Evaluation and Authorisation of Chemicals (REACH) regulation - may be overlooked or under-analysed by analysts.

This in turn presents an opportunity for investors to benefit from identifying an issue in advance of the market, and/or better analysing the financial impacts of such changes.

The case study illustrates that there are potentially a series of market inefficiencies associated with such regulations, including analysts' reliance on companies to communicate information to the market (which can mean that the information is received too late to allow individual investors to benefit), and the inadequacies in the cost-benefit assessments conducted by companies, governments and industry associations.

Also highlighted are some of the difficulties in factoring corporate responsibility issues into investment analysis, in particular the tendency of investors to discount future impacts and to wait for policy certainty (in this case, the final regulation) before making investment decisions.

That is, even though potential market inefficiency has been identified, it is by no means certain that investors will alter their investment decisions based on this information.

Cost and quality

The fact that market inefficiencies exist does not mean investment out-performance will be achieved by all investors that seek to focus on these issues.

There are two important reasons: research costs and the quality of investment research that is available.

First of all, the financial analysis of SEE issues can be expensive, especially given that there is often limited readily available information about company performance.

In many cases, the costs of enhancing analysis on SEE issues beyond a certain point will exceed the benefits.

These research costs - especially given that it is by no means certain that investment outperformance will be achieved - are a significant barrier to investment managers investing resources in this specific area.

This does not mean that investment managers will not incorporate research (eg from the sell-side) into their analysis but, rather, that they may decide not to develop their own capacity in this area beyond a certain point.

Secondly, the quality of the available investment research may be a barrier. The research produced by sell-side brokers has been criticised for being overly focussed on short-term drivers of share price rather than focussing on long-term value drivers, impacts on intangible assets (brand, reputation) and uncertain events.

There are signs that this is beginning to change.

In recent years, investment analysts have significantly increased the amount of research they do in this area, and have produced reports on issues such as HIV/Aids in the southern African mining industry, the effects of the European Union's Emission Trading Scheme on European electricity utility companies, the implications of obesity for food producers and retailers, and the effects of climate change on the insurance sector.

So, SEE issues can be important business value drivers, and there is the potential for investment performance to be enhanced through an explicit focus on these issues.

This has led to an increase in the number of investment managers that look at these issues in their investment processes and in the quantity and quality of research being done on these issues.

However, enhanced analysis is relatively new and it is therefore too early for those investment managers that have focussed resources in this area to systematically demonstrate investment outperformance, although the evidence to date is encouraging.

We hope that over the next few years we will start to see a stronger body of evidence emerge about the value of explicitly focussing on SEE issues in investment analysis.

Case study: the REACH regulation

The proposed EU Registration, Evaluation and Authorisation of Chemicals (REACH) regulation for chemical companies operating in the EU represents a major challenge for the chemicals sector.

It could potentially require companies to re-evaluate and even change their existing product portfolios based on new risk information, to communicate risk and safety information through their supply chains and to other stakeholders, and to innovate to develop safer products.

The business implications include market loss - eg certain chemical lines may need to be discontinued, input material loss and hence the need to obtain replacement raw materials, the potential to stimulate innovation and the increased risk of litigation.

Despite these business risks and opportunities, Insight Investment's discussions with UK sell- side brokers in mid-2003 revealed that none had formed a detailed research-based view on the implications of REACH for the EU chemical sector.

Most suggested that this was because the regulation was in draft format, and was unlikely to be passed in its then current form. Others referred to the time horizon for the impact of REACH being too far off to affect current valuations.

In addition, there was no consistency between the EU's and the companies' estimates of the financial costs of the regulation.

Insight concluded that REACH was highly relevant to its valuations of companies in the European chemicals sector and that further detailed research on the company specific impacts of REACH could enhance investment returns.

Insight's analysts began to introduce questions on REACH at company meetings in order to assess company preparedness. However, the responses were so divergent that Insight decided to conduct a more systematic sector-wide survey.

In early 2004, Insight surveyed 17 chemical companies in the UK and continental Europe, requesting them to submit quantitative and qualitative information on how REACH may impact their business.

The quality of company responses varied significantly, and most were not in a position to give estimates of the financial impact.

Insight - in conjunction with the CES (Centre for Environmental Strategy) - subsequently conducted a detailed company-specific business impact assessment of REACH, to analyse company exposures to REACH (and hence the costs associated with responding) as well as developing a comparative ranking of company preparedness to implement the legislation and the potential business impacts.

Our analysis concluded that the impacts of REACH varied significantly between companies, with the regulation having the potential to significantly affect the earnings of some but not all companies in the sector.

For further information, see: Steve Waygood, Steffen Erler, Walter Wehrmeyer and Harish Jeswani, Integrated Investment Analysis: Investment Implications of the REACH Regulation, in Rory Sullivan and Craig Mackenzie (eds) (2006), "Responsible Investment" (Greenleaf, Sheffield, UK).

Rory Sullivan is director, investor responsibility, and Craig Mackenzie is head, investor responsibility, at Insight Investment, the asset management arm of HBOS plc. They are the editors of "Responsible Investment" (Greenleaf Publishing, 2006).

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CEOs Embrace Corporate Social Responsibility With New Urgency, but Do They Risk Angering Shareholders? Not If They Can Prove Bottom-line Benefit

CEOs Embrace Corporate Social Responsibility With New Urgency, but Do They Risk Angering Shareholders? Not If They Can Prove Bottom-line Benefit, says New Survey | Country : Global | Company : GE, Procter & Gamble, BP, Wal-Mart  

As reported in the June 26 issue of BusinessWeek, CEOs of companies including GE, Procter & Gamble, and British Petroleum are going to heightened lengths to develop a "congenial" reputation and improve the public image of their companies. Even Wal-Mart CEO H. Lee Scott Jr., whose company has often been noted for its unrelenting focus on shareholder value, has finally relented to negative press about the company's links to social and environmental problems and launched a number of distinctly community-related initiatives. This corporate pendulum swing may be seen as an inevitable reaction to the public's cynicism about recent scandals, but the shareholders of aspiring socially responsible companies may also push back unless CEOs can definitively answer the following question: Is all of this benefiting--or hurting--the bottom line? Image source:

Sources : Impact Builders | Type of Sources : NGO | More information

Coming down to Earth: Linking up computers to defeat malaria [Africa@home]


Coming down to Earth

Jul 13th 2006
From The Economist print edition

Linking up computers to defeat malaria

IF MANKIND ever makes the acquaintance of an extraterrestrial alien, the chances are that first contact will come through a humble desktop computer. The SETI@home project, which searches for signs of intelligent broadcasting among the natural radio signals coming from the sky, depends for its computing power on the spare capacity of a zillion small, private machines around the world.

Although SETI@home may or may not find what it is looking for, it has unarguably started a fashion. Donating spare computer cycles to worthy causes is a cheap way of helping those who cannot afford huge piles of hardware to achieve their goals. The latest organisation to take advantage of this is one of the most worthy of all. Africa@home aims to use that spare capacity for no less a task than the defeat of malaria, a disease that kills more than 1m people a year.

Africa@home is a collaboration between the Swiss Tropical Institute, CERN (a big particle-physics laboratory also based in Switzerland) and a group of universities, including three from Africa. Its aim is to develop a long-term model of malaria epidemiology, which it can use to test different ways of combating the disease.

The institute already uses models to study the short-term dynamics of malaria transmission. However, the computing power needed to generate accurate long-term results is beyond its means. Which is where CERN comes in. Besides studying the fundamental nature of reality, the laboratory is also a huge computing centre. Indeed, it is where the world wide web was invented. And, in the wake of the web's success, it has maintained an interest in how to link up lots of small computers so that they can perform tasks beyond most large ones. Long-term epidemiology is an excellent example of such a task.

Using CERN's tools, the universities have devised a program called, which takes the institute's model and converts it into a form that can be scattered meaningfully across hundreds—or even thousands—of computers. can handle a lot of different sorts of variable, from the changing density of parasites within a human host as an infection progresses to the sort of treatment available in different places around the continent. It also looks at the relationship between parasite density in people and the rate at which humans transfer those parasites back to the mosquitoes that carry them. It can even take account of the time of year, and thus the amount of standing water around for mosquitoes to breed in. Using these variables, it can then predict the result of deploying various drugs, the likely success of methods such as insecticide-covered bed nets that are used to block transmission of the disease, and the probable impact of a vaccine, if and when one becomes available.

A test run using 500 computers has just been completed successfully and the project is now being opened to 1,000 more volunteers (the Africa@home website is accepting registrations). Those volunteers will be able to bask in the knowledge that they are helping to create a cheaper and longer-lasting way of dealing with one of the world's biggest killers. That should be some compensation for not being the first to contact little green men.

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Security, human rights and business: A turning point for the Voluntary Principles

Security, human rights and business: A turning point for the Voluntary Principles
Peter Davis, Politics Editor
4 Jul 06

Where to now for voluntary principles on human rights?

The implications of the announced changes in participation in the Voluntary Principles on Security and Human Rights are that this key business membership group stands at a crossroads between developing a more open membership and pressing rapidly ahead with stricter criteria
A plenary session of the Voluntary Principles on Security and Human Rights announced in late April that participation would be opened to more extractive companies, NGOs and project host governments.

It will now be possible for a company or NGO to become a participant in the principles process even if their home government is not a member – a change to the current situation.

Also, it will become possible for host governments that play an active role in the implementation of the principles to become participants.

The Voluntary Principles were launched in 2000, initially as an initiative of the US Department of State and the UK Foreign Office.

They were developed in response to a number of well-publicised cases where companies’ security forces in developing countries had been implicated in human rights abuses while seeking to protect company installations or personnel.

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The principles were developed to help companies balance the need for safety and security with respect for “human rights and fundamental freedoms”.

Widening the scope

This move is a significant development. Companies like Petrobras of Brazil, Pertamina of Indonesia, and China’s Sinopec and PetroChina are fast becoming highly significant players in the international oil and gas exploration business.

And there is now a possibility that these companies might be brought into the process even if their home governments fail to join.

However, there are aspects of “participation” in the process that evidently remain unresolved.

So much was made abundantly clear by a joint statement by the Process’s NGO participants expressing “deep disappointment” at the failure of the plenary session to reach agreement on a set of governance and accountability criteria.

Details of the debate at the January session have not been made publicly available. However, it is clear from various participants that, for the NGOs involved, this meeting represented something of a watershed.

According to one well-placed source, the NGOs saw this 5th anniversary meeting as an opportunity to “take stock” on the process and to press for greater delivery from corporate participants.

A draft text outlining “participation criteria” was introduced and discussed at the session. Although a final version has yet to be agreed, Ethical Corporation understands that the current version has support from almost all participants, including representatives from each “pillar” – corporates, NGOs and governments.

High stakes

According to Amanda Gardiner, head of the Voluntary Principles’ secretariat at the International Business Leaders Forum: “The aim of developing participation criteria is to make the principles process more transparent, and to encourage more companies, governments and NGOs to get involved.”

However, the stakes are high. A statement by Amnesty International made it clear that, for them, the credibility of the whole initiative is in jeopardy without the establishment of “clear and transparent governance criteria for the evaluation of performance and possible suspension of non-compliant existing members”.

Gardiner believes that: “The strength of the Voluntary Principles process is that it enables participants to share good practices. The goal is not to judge, or to name and shame, but to urge consistent improvement in the area of security and human rights.”

However, this approach works only if all participants can agree both about what “consistent improvement” looks like, and the time frame over which this should occur.

So far, all those involved remain committed to using the principles process to raise standards of performance.

However, it is evident, not least from Amnesty’s statement, that this position is under some strain.

Equally evident is that the strain emanates from scepticism about the commitment of certain corporate participants to effecting real change in their operations.

The next few months will be critical to the future development of the Voluntary Principles. Some key questions remain.

Is it better to remain a broad church and include anyone wishing to participate, whatever doubts there might be about their ability or willingness to deliver?

Or should the sanction of exclusion or suspension be available to enable a perhaps smaller group to move forward more swiftly?

Useful links:

Voluntary Principles – corporate members

Amerada Hess Corporation
Anglo American
BG Group
BHP Billiton
Freeport McMoRan Copper and Gold
Marathon Oil
Newmont Mining Corporation
Norsk Hydro
Occidental Petroleum Corporation
Rio Tinto

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Experts discuss linking CO2 trading schemes; Green Light for Project to Standardize Emissions Inventories, Reductions, and Offsets

Green Light for Project to Standardize Emissions Inventories, Reductions, and Offsets

MADISON, Wis., July 5, 2006 - The nonprofit Leonardo Academy has announced a new project to develop ANSI (American National Standards Institute) standards for quantifying and documenting environmental emission inventories, offsets, and reduction credits. ANSI is a private, nonprofit organization that administers and coordinates the U.S. voluntary standardization and conformity assessment system.

The standards are needed, say project organizers, to accelerate the growth of market-driven emission reduction actions, and will make it easier for consumers, building owners, and companies to get credit for the environmental benefits of their emission reduction actions. They will provide consistent integrated coverage of the full range of emissions types, from greenhouse gases to mercury. The open and transparent standards will make it clear in the marketplace what stated emission inventories, offsets, and reduction credits really mean.

The process will create a single standard that combines the breadth of current information on the topic into an integrated, easily understood package providing the essential benefits to both the environment and the business world. The objective of this initiative is to develop credible and effective standards for emission inventories, offsets, and reduction credits that are practical for both end users and the marketplace, and are therefore effective drivers for environmental improvement

Leonardo Academy President Michael Arny said, "This is an important initiative because effective emissions crediting and offsetting standards are key to solving both our global warming and toxic emissions problems. Such standards make it economically and socially advantageous to increase this type of environmental stewardship, engaging the creative energy and drive of the marketplace to achieve important environmental goals."

Individuals and organizations take action to reduce emissions for many reasons including altruism, the opportunity for recognition, and to capture the market value of these emission reductions. Having a consistent and practical way of keeping score is a driver for action Arny says. For example, the development of integrated emissions standards will make it possible for car buyers to capture the economic value, at the time of purchase of their low emission vehicles' pollution reductions over the life of the car. It will make it possible for a building owner that documents reduced energy use to capture the economic value of emission reductions created by their actions.

Many government, non-government and nonprofit organizations have made important contributions to the knowledge base on emission reduction credits and offsets in both the regulated an unregulated arenas, but standards and programs are often disjointed and limited in the types of emissions they address, the geographic areas they cover, and the applicable participants. The goal of this standard development initiative is to provide an integrated standard that has broad coverage for types of pollutants, geographic scope and participants.

“This ANSI standard development process will build on all the great work that has been done to date to create an integrated standard that has broad coverage and works well for both the users and the public, “ said Arny.

The projected scope of the new standards include:

  • A multi-pollutant approach to emissions issues that awards credit for all types of emissions reduced
  • Levels of documentation and verification needed for various applications
  • A clear description of qualified verifiers for achievements
  • Baselines set to recognize all positive achievements
  • Emissions inventories for organizations, products, services, events, travel, families, individuals and other causes of emissions
  • Emissions offsets for organizations, products, services, events, travel and other causes of emissions
  • Direct and indirect emission reduction
  • Emission reductions created by pollution sequestration, renewable energy, energy efficiency projects, and other emission reductions
  • Market vehicles for emission reductions and offset transactions, including emission reduction credits, white (energy efficiency emission reductions) tags, green (renewable energy emission reductions) tags, etc.
Funding for all Leonardo Academy projects is being gathered from a variety of sources on an ongoing basis. Johnson Controls, a major creator of emission reductions through energy efficiency, has contributed $20,000 to become a Silver Level Sponsor of this project. Johnson Controls is delivering enough energy efficiency for its customers to meet 4% of the Kyoto goals. Leonardo Academy is seeking additional sponsors at all levels for this project.

Leonardo Academy is an ANSI accredited standards developer, and this project will be carried out in accordance with Leonardo Academy’s ANSI approved standard development process. This project was announced through the ANSI Project Initiation Notification System on June 23, 2006 and has the ANSI standard development number BSR/LEO 5000-200x.

Leonardo Academy develops rating systems, certification programs, educational resources and other tools that make practicing sustainability practical. The organization aims to put the competitive market to work on improving the environment, by developing outcome-focused products and resources that facilitate sustainability.

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Experts discuss linking CO2 trading schemes, 6 July 2006 - Environmental experts and stakeholders analysed the potential for linking the EU Emissions Trading System (EU ETS) with emerging carbon markets worldwide.

Brief News:

Gathered under the auspices of the Wuppertal Institute for Climate, Environment and Energy and the German Ministry for Education and Research, speakers from diverse institutional and national backgrounds tackled issues of linking emissions trading schemes at a Brussels conference on 29-30 May.

To open the debate, the European Commission reiterated its expectations that member states deliver their second phase allocation plans by 30 June, and expressed its readiness to take action if they fail do to so.

In the first part of the debate, participants drew an uneven picture of existing domestic emissions' reduction initiatives, with countries such as Switzerland, Australia and the US on the progress side vs. Canada and Russia in a less advanced situation. Against this backdrop, the issue of compatibility of designs between the different ETS overwhelmed the debate. While some systems, such as the US one, are said to have been framed in a purely national scope (Wolfgang Sterk, Wuppertal Institute), many others would simply not fulfil two essential requirements to be compatible with the EU ETS – namely, to be mandatory and not to include price caps (Alexander Savelkoul, Essent).

The rest of the discussions revolved around the potential economic and environmental impacts of linking trading schemes. Many speakers criticized the EU ETS for its inefficiency in cutting Kyoto compliance costs, suggesting that linking it to "similarly suboptimal non-EU systems" would only worsen that trend. On a more positive note, Ralf Schüle (Wuppertal Institute) viewed linking schemes as an instrument for keeping open the door for "non-ratifiers [of the Kyoto protocol] to participate in the emerging international carbon markets, and thus serve to draw them back into the fold." That way, it could function as a non-negligible "parallel track of international mitigation policy."


Wuppertal Institute for Climate, Environment and Energy: Conference Report: Potential Impacts of Linking the European Union Emissions Trading System with Emerging Carbon Markets in other Countries (May 2006) [Summary]

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Indonesian pulp and paper company fails to protect high-valued forests

Indonesian pulp and paper company fails to protect high-valued forests

11 Jul 2006
Jakarta, Indonesia – A new WWF monitoring report reveals that Asia Pulp & Paper (APP) continues to threaten forests in Indonesia that are important to both wildlife and people, despite earlier commitments and pledges made by the company to its buyers.

According to the report, the company has been responsible for some 80,000ha of natural forest loss every year, equivalent to roughly one-half of the Indonesia province of Riau’s annual forest loss since 2002. As of 2005, the company controlled nearly one-fifth, or 520,000ha, of the natural forests left on Riau’s mainland. All these forests are under threat, as are any additional forests that APP acquires in its quest to fill its wood supply gap and expand pulp production.

“We estimate that around 450,000ha of natural forests have been cleared over the past five years to supply APP’s pulp mill in Riau," said Nazir Foead, WWF-Indonesia's Director of Policy & Corporate Engagement.

"APP’s failure to commit to the protection of high conservation value forests means that hundreds of thousands of hectares of forests will go the same route.”

High conservation value forests (HCVFs) are forests of outstanding and critical importance due to their environmental, socio-economic, biodiversity or landscape values. At a meeting with WWF last month, APP refused to guarantee that such forests would be excluded from its future logging and wood sourcing operations. APP had called for the meeting in response to WWF's report. It was the first official meeting between the two since February 2004 when WWF ended its formal engagement with APP over the company's refusal to address key environmental and social concerns in its sustainability action plan.

Since 2001, WWF and some of APP’s customers had been calling for the company to develop a sustainable wood supply plan that would protect HCVFs. APP had previously committed to protecting several HCVF blocks, however, recent monitoring reports show that the company failed to protect these blocks from illegal logging and fires.

“By refusing to protect HCVFs, APP is endangering the very survival of the tigers, elephants and other species that inhabit Indonesia’s forests,” Foead added. “It is not justifiable for one company to destroy forests which are highly valuable for the sake of corporate profits.”

WWF is working with the central and local governments in Indonesia to factor the protection of conservation values into land-use planning and licensing processes. These procedures currently do not ensure protection of all HCVFs. The global conservation organization is already successfully working in partnership with palm oil producers, including APP's sister company, PT Smart, to develop practices that maintain HCVFs in and around their oil palm plantations.

WWF is also assisting global pulp and paper buyers to apply responsible purchasing policies that require avoiding products that contain fibre sourced from illegal logging operations or from unprotected HCVFs.

“There is no excuse for buyers with responsible purchasing policies to trade with a company that continues pulping high conservation value forests,” said Duncan Pollard, Director of WWF's Global Forest Programme.


• According to a background paper that accompanies the WWF Monitoring Report, half of Riau’s forests disappeared between 1988 and 2005 at an average rate of 170,000ha a year, or 460ha a day. The annual rate of forest cover loss was 2.2 per cent in 2002, 4.2 per cent in 2004 and 6.8 per cent in 2005, illustrating a rapid acceleration over the past few years. The key cause of the forest loss has been land clearance to feed timber to the two pulp mills belonging to multi-national companies APP and Asia Pacific Resources International (APRIL). Since 2001, WWF-Indonesia has been calling for both companies to protect HCVFs, not only in Riau, but also globally. In July 2005, APRIL publicly committed to protect and exclude all HCVFs from its global wood supply.

• PT Smart, APP’s sister company in the Sinar Mas Group, has already committed to protect HCVFs at the Roundtable on Sustainable Palm Oil (RSPO). Initiated by WWF and various partners in 2003, the RSPO is an independent, non-profit, multi-stakeholder association focused on promoting sustainable palm oil and achieving a common definition of responsible palm oil production. A key element of responsible palm oil production is HCVF protection. All companies that are members of the RSPO must identify forest areas of high conservation value before establishing new plantations or expanding existing ones.

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It's Not Too Early: What has happened to such far-out and disruptive -- but not necessarily unfeasible -- visions for a renewable-energy future?


It's Not Too Early by Marty Hoffert
We know where we must go eventually. Why not head there now?

It's Not Too Early
We know where we must go eventually. Why not head there now?
By Marty Hoffert

In the 1970s, Buckminster Fuller proposed superconducting global-scale electrical grids to wheel solar energy collected on the daylight hemisphere halfway around the earth to the nighttime hemisphere.

Given the potential for catastrophic climate change, a question must be asked: What has happened to such far-out and disruptive -- but not necessarily unfeasible -- visions for a renewable-energy future? Right now, hundreds of new coal plants are on drawing boards around the world (see "The Dirty Secret").

Today, the world uses about 13 terawatts of power, approximately 80 percent of it from carbon-dioxide-emitting fossil fuels. If we want to keep Earth's average temperature low enough to prevent eventual large sea-level rises (see "The Messenger") -- and also accommodate continued 3 percent annual economic growth -- we will need between 10 and 30 terawatts of new carbon-free power by 2050.

The time to start building a sustainable carbon-free energy infrastructure is now. We need Apollo-type research to accomplish this, beginning perhaps with funding of far-out programs along the lines of ARPA-E ("E" for energy), an initiative proposed by the National Academy of Sciences and modeled on the U.S. Advanced Research Projects Agency (now prefaced by "Defense"), which gave us the Internet.

A global-energy-systems engineer -- if such a profession existed -- would probably have recourse to many technologies that are disruptive of today's powerful coal, oil, and gas industries. Wind turbines are already economically competitive with conventional energy sources in some regions. Steadier and faster high-altitude winds might be harvested someday by flying wind turbines that transmit electricity to Earth through tethering wires.

The greatest potential for terawatt-scale renewable electric power lies in harvesting solar energy directly. About 2,000 megawatts of silicon-based photovoltaic cells have been manufactured, but the existing technology is expensive. A promising path to cost reduction is thin-film cells that include materials like copper indium diselenide, cadmium telluride, and amorphous silicon. Aggressive R&D and expanding markets will reduce costs, but a big push from government could help realize solar's vast potential.

One weakness of solar power is its intermittency. But photo-voltaic panels in geostationary orbit could be positioned to receive constant sunlight and thereby furnish the earth with a reliable stream of electricity. They should be the focus of experiments on the scale of the International Thermonuclear Experimental Reactor scheduled to be built in France. Unlike fusion, space-solar technologies -- including wireless power transmission -- are well understood. The aesthetics, like those of offshore wind turbines, are contentious. But for me, the image of a ring of sun-reflecting solar-power satellites in the night sky evokes Yeats's "golden apples of the sun" -- humankind's coming of age on star power. On Earth, we need entirely new electrical grids that are "smart," store excess power, and minimize resistance to enable transmission of renewable but intermittent energy across continents.

There's much more that can be done to promote "green" homes and offices through a more enlightened federal policy. Mass public exhibits of creative sun- and wind-powered technology, buildings, and communities could stimulate consumer demand in the way that General Motors' "Futurama" exhibit at the 1939 World's Fair created demand for cars and parkways and, by extension, suburban homes.

The late Nobel laureate Rick Smalley observed that even though our civilization has many problems, energy is central to all of them. Questions that begin "What is...?" are often the wrong ones; the better question is "What could possibly be?" Spurred by World War II, the United States went from biplanes to jets, from laboratory U-235 fission to Hiroshima, from microwaves to radar -- all in less than a decade. The coming battle for a sustainable energy infrastructure will require every bit as much a team effort from government, researchers, and industry. We know where we must go eventually. Why not head there now?

Marty Hoffert is professor emeritus of physics at New York University.

Copyright Technology Review 2006.


Every company has a sustainability sweet spot: Reviews of Andy Savitz' book

Every company has a sustainability sweet spot

By Alison Maitland

Published: July 5 2006 03:00 | Last updated: July 5 2006 03:00

Andrew Savitz recalls a conversation he had with a purchasing manager at a large telecommunications company. The man was adamant that social responsibility had nothing to do with his job, which was to buy products at the lowest price.

"Would you buy from a foreign supplier that you knew was employing 10-year-old girls and paying them 60 cents a day for their labour?" Savitz asked. "Of course I wouldn't do that," came the reply. Not even if the supplier offered the lowest price, if child labour was legal in that country and if no one could possibly find out? No, the manager re-plied. It would not be right.

"Do you think your company would support your decision to sacrifice profit in this case?" Savitz persisted. "Absolutely, I'm certain of it," the manager said.

Do not be deterred by the unfortunate title of this forthcoming book. In just 250 pages, rich in anecdotes, Savitz makes a lively and cogent case that no company or manager can afford any longer to ignore the world around them.

Many of the reasons companies face "the age of accountability" are familiar, but it is useful to see them pulled together: our shared sense of vulnerability, fostered by climate change and natural disasters, coupled with the awesome power that global corporations have accumulated; the goldfish bowl in which companies operate; their increased exposure through networks of business partners and global supply chains; the campaigns mounted by lawyers, non-governmental organisations and shareholder activists.

But this book is not a tract admonishing business to take its responsibilitiesseriously. Its central argument is an upbeat one that is gaining currency: it makes financial sense for companies to anticipate and respond to society's emerging demands. In the long run, says Savitz, the sustainable company is likely to be highly profitable. There is a flipside: companies that fail to respond, or thumb their noses at society, are likely to pay the price.

What is a sustainable company? Savitz and Karl Weber, his co-author, spend time on their definitions - a sensible move given the confusion and spin that often surround this debate.

Sustainability is not about philanthropy, which has nothing to do with the company's main purpose. Nor is it merely about ethics. The authors even prefer "sustainability" to "responsibility", arguing that the latter emphasises benefits to society rather than benefits to the company.

For Savitz, who created the environmental practice at PwC and has worked with some of America's biggest companies, it is about conducting business in a way that benefits employees, customers, business partners, communities and shareholders at the same time. It is "the art of doing business in an interdependent world".

The best-run companies find "sustainability sweet spots" - areas where shareholders' long-term interests overlap with those of society. Implausible? Look at General Electric, with its revenue-boosting Ecomagination green technology, says Savitz. Or Toyota's fuel-efficient Prius. Or Unilever's Project Shakti in India, training 13,000 women to distribute its products to rural customers and thereby greatly increasing families' income while expanding its market penetration.

Every company can find a sweet spot, he suggests, even if it is the minimal one of cutting costs by reducing energy use, employee accidents or the chances of a lawsuit - though some of this could just as well be called smart risk management.

In the second half of the book, he explains how to translate all this into "business as usual": how to decide what it means for the company; how to work with stakeholders, not against them; how to set enforceable goals in difficult areas such as child labour. Throughout, the arguments are driven by pragmatism, not dewy-eyed altruism. The narrative occasionally suffers from its American slant. The English Quakers, after all, pioneered decent working and community practices long before Henry Ford.

Even if you do not agree with it all, this is a thoughtful guide for managers who still harbour doubts about the point of sustainability, who are taking tentative steps towards it or who are seeking a clearer path through the maze. With luck, it should also help the anoraks in the sustainability industry to distinguish the wood from the trees.

Note created Jul 5, 2006 / Home UK / UK - Every company has a sustainability sweet spot -

Book Review--The Triple Bottom Line: How Today's Best-Run Companies Are Achieving Economic, Social, and Environmental Success--And How You Can Too - 07/13/06
Andy Savitz, formerly of the Environmental and Sustainability Services group at PricewaterhouseCoopers (PwC), has written perhaps the best, most comprehensive book to date on corporate sustainability. Along with co-author Karl Weber, he coins new terms and concepts to describe the evolving concept of corporate sustainability, and provides a cornucopia of real examples to illustrate his points. More importantly from a practical perspective (as the clunky subtitle suggests), he maps out how corporations (from the CEO to the middle manager) can traverse the landscape toward the The Triple Bottom Line of economic, social, and environmental sustainability.

Too much commentary in the business world on sustainability advances an emasculated version of the term, forgetting its roots in the Brundtland Commission's 1987 definition of development that nourishes (not impoverishes) global social and environmental health.

"[A] sustainable corporation is one that creates profit for its shareholders while protecting the environment and improving the lives of those with whom it interacts," writes Mr. Savitz. "It operates so that its business interests and the interests of the environment and society intersect."

This definition raises a bit of a red flag by not balancing social "improvement" with environmental "replenishment" (instead of "protection"). However, Mr. Savitz later reveals a deep understanding of the range of controversy surrounding the definition of sustainability by discussing in depth leftwing cynics and rightwing skeptics of the term. He admits many valid points of the cynics--such as progressive changes coming at the margins instead of the core of businesses and sustainability initiatives motivated more by a desire to avoid regulation than true commitment. He also reframes many of the skeptics objections, for example quoting Adam Smith's social conscience from The Theory of the Moral Sentiments to counterbalance his more famous claims of "enlightened" self-interest (the basis of free market thinking) in The Wealth of Nations.

Mr. Savitz also importantly distinguishes between sustainable and responsible corporate behavior, noting significant but not complete overlap. He illustrates this distinction in developing one of the most important conceptual coinages in the book, the sustainability "sweet spot"--namely, the locus where business interests intersect with social and environmental interests. He displays this convergence graphically in a four-celled matrix with two axes--one representing profitability, the other representing social and environmental benefits--with the goal of moving into the northeast corner of maximizing financial, social, and environmental returns.



"If it were possible for [an oil] company to shift its business so as to eventually supply clean and renewable energy (such as wind or solar power) or conservation services while maintaining or even increasing revenues, that would be a responsible and profitable choice," Mr. Savitz writes. "BP has since [1998, when it rebranded itself "Beyond Petroleum"] reduced greenhouse gas emissions from its own production processes (saving an estimated $650 million thanks to improved efficiencies along the way) and has invested heavily in alternative energy sources, including solar power."

"BP is not yet sustainable by any means, but it is acting responsibly as it marches toward an ever larger sweet spot," he adds.

This example also illustrates a much later set of concepts Mr. Savitz introduces, minimization (or "being less bad") and optimization (or "being more good.")

"Optimization aims not just to reduce pollution, but to restore the environment; not just to eliminate employee accidents, but to create a healthier, happier workforce; not just to decrease harm to the community, but to revitalize it," Mr. Savitz writes.

Note the espousal of replenishment over mere protection, suggesting a development beyond the initial definition of sustainability. Indeed, by the end of the book, Mr. Savitz is citing Global Reporting Initiative (GRI) co-founder Allen White's Corporation 2020 initiative to reformulate the corporate structure. He also praises the move toward "dematerialization," whereby companies substitute services for products (for example, VW re-envisioning itself as a "global mobility group" to focus less on the production of cars and more on the transportation services they provide.)

Counterbalancing these more theoretical leanings is an exceedingly practical focus, with an appendix charting the entire course executives and managers need to consider to move their companies toward sustainability. Suggestions include a "virtual sustainability department" that integrates expertise and knowledge from across the entire company, as well as strong encouragement to report sustainability policies and performance using GRI guidelines.

Finally, the book is incredibly readable. The chapter entitled "Renewing the Penobscot" is a page-turner. It chronicles the story of negotiations between PPL Corporation and environmentalists, fishing enthusiasts, the Penobscot Nation, and government officials to address problems with damming the Penobscot River in Maine. The story unfolds in a layered retelling, revealing the drama behind what is called stakeholder engagement but really boils down to human interactions. The episode vividly exemplifies how corporate sustainability plays itself out in real life.

- Bill Baue

College Students Spend On Brands That Respect Mother Nature

College Students Spend On Brands That Respect Mother Nature

JULY 13, 2006

Green is good, in more ways than one.

The image most people have of college students today may entail more binge drinking than tree hugging, but according to a new report, "The 5th Annual College Explorer Study," from Alloy Media + Marketing (AM+M), and conducted by Harris Interactive, they may have to revise their thinking — at least when it comes to buying habits.

The study, conducted online among nearly 1800 college students (full-time, part-time, 4-yr., 2-yr., aged 18 to 30), found that many of them are socially conscious and put a premium on products from companies that demonstrate a healthy respect for Mother Nature.

"We are seeing that today's young people expect corporations to be socially responsible and that students prefer to associate with brands that they perceive to be positive contributors to the community," said Samantha Skey of AM+M.

The fact that students prefer an honest and effective social responsibility campaign to celebrity endorsements came through loud and clear in the study. When asked about factors that drive their purchase decisions, 33% of the students said they prefer brands that are environmentally safe or are connected to a cause.

Socially responsible characteristics surpassed a great brand image and a preference for a brand used by celebrities by wide margins in its influence on discretionary spending. In fact, one in four students (24%) said they had purchased a product this year specifically because it was socially conscious.

"In this year's study, we asked students to tell us the brands they most admire," said Ms. Skey. "We've fashioned their opinions into the Alloy U Awards, designed to recognize the companies that students perceive to be most socially responsible. Students were most likely to believe that companies who weave their social messaging into their brand DNA, from advertising to product packaging and events, are the most committed to their causes."

The 2006 Alloy U Award winners for "Top Socially Responsible Brands," as recognized by college students, are:
1.        Ben & Jerry's
2.        Newman's Own
3.        Burt's Bees
4.        Yoplait
5.        American Apparel
6.        Starbucks
7.        Seventh Generation
8.        Nike
9.        Body Shop (tied)
Coca-Cola (tied)

"The college student market is now well over 17 million strong, and continues to grow in size and importance for marketers as the considerable influence they've gained in the past few years as technology early adopters bleeds into other areas, like social responsibility," said Dana Markow of Harris Interactive. "Watch for the 'greening' of the college market and their $182 billion in aggregate spending power to have a big effect on brand positioning and campaigns in the coming year."

For more information on this important demographic segment, read the eMarketer report College Students Online: Social Networks and the Net Generation.

Note created Jul 13, 2006 - College Students Spend On Brands That Respect Mother Nature -

Plan to promote hydrogen cars; Biodiesel Comes in All Flavours

Biodiesel Comes in All Flavours

Inter Press Service, 8 July 2006 - The production of biodiesel from low-quality coffee, from the oils extracted from urban runoff, or from cattle fat is a pioneering initiative in Brazil, where efforts are under way to diversity the raw materials used as clean fuels, the consumption of which is on the rise.

Under the Brazilian system for the voluntary addition of two percent biofuel to petroleum diesel (B-2), the demand currently stands at about 800 million litres annually. This mixture will be obligatory beginning in 2008, and the proportion will rise to five percent in 2013, driving up total biodiesel consumption to an estimated 2.5 billion litres a year.

Coffee beans of lower quality, which represent about 20 percent of the national coffee harvest, are emerging as an alternative raw material for biodiesel.

The idea to make use of the "defective" beans, withdrawing them from the coffee market, has as its "first objective the improvement of the quality of Brazilian coffee exported and consumed domestically," explained Almir José da Silva Filho, president of the coffee industry association, Sindicafé, in the state of Minas Gerais.

The technical viability of the project has been proved in the laboratory, says Leandro Soares de Oliveira, of the Federal University of Minas Gerais, which is conducting the experiments under an agreement with Sindicafé.

Next will be to expand the tests to a commercial scale, with industrial equipment already available on the market -- a phase that should be complete next year, he said.

It is also essential to ensure the project's economic viability, given that the coffee that should be discarded is still sold at a price higher than that of biodiesel, Sindicafé's Da Silva added.

The Brazilian public sector, the instant coffee industry and some importing countries are the big buyers of lower quality coffee beans.

Energy production from biodiesel produced from coffee would help regulate the market to the benefit of all, but Da Silva predicts there will be controversy before convincing everyone along the chain of the coffee economy.

Production of coffee-based biodiesel for a company's own use is one option, because it would be cheaper than biofuel purchased at service stations, and the organisation of coffee growers in cooperatives and associations facilitates this alternative, said university researcher Oliveira.

Every 100 kilogrammes of coffee can produce 12 kg of oil, which can be turned into 9 kg of biodiesel. The output is limited compared to soybeans and some other oil sources, but low-quality coffee is a raw material already available, making the process less expensive, Oliveira noted.

Oil from urban runoff has also been proved as a "good quality" raw material for biodiesel, according to the analysis by a German laboratory, says Luciano Basto, an engineering researcher at the Federal University of Rio de Janeiro, where this option is being studied.

The project suffered a delay due to the lack of an agreement with the local sanitation agency, and it wasn't until recently that the equipment was installed at a wastewater treatment station in Rio de Janeiro, which will allow the assessment of its economic feasibility in the next six months, said Basto.

Making use of urban waste is recommended because it is immediately available and it benefits the environment. Converting oil from runoff into fuel would stimulate basic sanitation in Brazil, where less than half the population has access to sewage systems.. This alternative could also generate carbon credits for trading in greenhouse gas abatement schemes.

Total national runoff theoretically represents a potential for producing 1.5 billion liters of biodiesel annually, but in reality only 40 percent should be considered, because that is how much runoff currently is collected by sanitation systems, according to the researcher.

Fat from cattle is another promising raw material. In this case, the technology has been imported from Italy, where it has been used for some time. The company Ponte Di Ferro is ready to begin production, but bureaucratic questions have put the brakes on the project, the firm's director Carlos Zveibil Neto told Tierramérica.

The surplus of animal fat on the market would allow production of biodiesel that is about 10 percent cheaper than soy-based fuel, a considerable advantage in the energy market. An estimated 23 million head of cattle are consumed in Brazil each year, which could produce 350 million litres of fuel from animal fat annually.

But this is a raw material that is rendered useless within 24 hours, that is, it becomes so acidic that after one day it is more appropriate for making soap than for biodiesel. This is why rapid transport or treatment plants near meatpacking factories is so essential, explained Zveibil Neto.

The diversification of raw materials for production of clean fuels -- currently concentrated in soybeans -- would help make the most of regional advantages, as is the case, for example, of palm oil in the Amazon, or castor-oil in the Brazilian Northeast.

"The market will decide which raw materials are viable after some time," said Orlando Cristiano da Silva, an expert with the national biomass research centre, associated with the University of Sao Paulo.

*Mario Osava is an IPS correspondent. Originally published July 1 by Latin American newspapers that are part of the Tierramérica network. Tierramérica is a specialised news service produced by IPS with the backing of the United Nations Development Programme and the United Nations Environment Programme.

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Plan to promote hydrogen cars, 14 July 2006 - The Commission is hoping to contribute simultaneously to the diversification of Europe’s energy sources and to the reduction of pollution by promoting hydrogen powered vehicles.

Brief News:

The Commission announced plans on 13 July 2006 to encourage the development of technologically advanced hydrogen vehicles and invited all interested parties to comment on its proposals.

The automotive sector is currently 98% dependent on oil. However, the Commission has set itself the objective of substituting 20% of traditional fuels with alternatives by 2020, identifying hydrogen as one of the most promising alternative ranges of fuels (see EurActiv LinksDossier on alternative fuels).

By setting new safety requirements for hydrogen powered vehicles and incorporating them into the European type-approval framework, the Commission hopes to boost consumer confidence and facilitate the commercialisation of such vehicles, so as to encourage investment. It is likely though that the main barrier for marketing hydrogen cars will remain their cost.

Hydrogen-fuelled motors do not produce any carbon emissions or greenhouse gases, contrarily to diesel and petrol, and will therefore contribute to the improvement of air quality.

In a parallel development, the European Parliament postponed, until September 2006, its vote on an earlier Commission proposal aimed at tightening up pollution limits for petrol and diesel cars, the ‘Euro 5’ proposal.


EU official documents

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Plan to promote hydrogen cars -

Some Applaud Rise in Sustainability Reporting, Others Say It Masks Corporate Unsustainability

Some Applaud Rise in Sustainability Reporting, Others Say It Masks Corporate Unsustainability, 11 July 2006 - Corporate sustainability reporting is on the rise, according to a new study of S&P 100 companies released today by the Social Investment Research Analysts Network (SIRAN) based on research conducted by socially responsible investing (SRI) research firm KLD Research & Analytics. More than three-quarters (79 companies) of the S&P 100 now have special website sections disclosing their environmental and social policies and performance, up 34 percent from 59 companies in last year's inaugural study. The percentage of companies using Global Reporting Initiative (GRI) guidelines rose from a quarter of the S&P 100 in 2005 to more than a third (34 companies) this year.

While many observers applaud this rise in sustainability reporting, researchers from the Centre for Social and Environmental Accounting Research (CSEAR) at Scotland's St. Andrews University question the basis of sustainability reporting, arguing it may do more harm than good. Professors Rob Gray and Jan Bebbington turn the "business case for sustainability" on its head, pointing out that our current capitalist system essentially structures corporations to be "un-sustainable."

"'Corporate Sustainability' has more than a little of the oxymoron about it," write Profs. Gray and Bebbington in a paper entitled "Corporate Sustainability: Accountability and the Pursuit of the Impossible Dream," a chapter in the forthcoming Handbook of Sustainable Development. "[A]n organization which is demonstrably using non-renewable natural capital and/or failing to replenish or substitute for other forms of natural capital and which can be shown to be exploiting and advancing social inequality and/or other forms of social injustice is clearly, in itself, un-sustainable."

"Further, if all (or most) economic organizations could be seen to be significantly un-sustainable then we may conclude that our economic system is, itself, un-sustainable," they add. "[W]e are entirely convinced that the un-sustainability we currently face is deep, systemic, and only barely, recoverable . . . we are unable to imagine substantial reductions in un-sustainability without profound structural and systemic changes--and soon."

Corporate sustainability reporting, Profs. Gray and Bebbington argue, does not seek to reform the system, but rather to highlight tweaks in social and environmental performance from within capitalism's structure (that prioritizes profit above social justice or environmental stewardship.) Therein lies the fatal flaw of sustainability reporting, according to the authors--that it holds out a false hope of companies achieving true sustainability when in fact the best they can do is disclose their degree of un-sustainability.

"The danger, of course, is that . . . the very concept on which the future of the planet depends--sustainability--will be emasculated, appropriated and destroyed by (at best, well-meaning) assertion in the interests of corporations," state the authors. "As things currently stand, we believe we must treat the current crop of 'sustainability reports' with the profoundest mistrust as one of the most dangerous trends working against any possibility of a sustainable future."

Steve Lippman, a member of the SIRAN steering committee and vice president of social research at Trillium Asset Management, shares the authors' concerns over the limitations to voluntary corporate sustainability. He also sees the need for a system of laws and regulations that require certain environmental and social performance from companies rather than hoping the marketplace and voluntary action will lead to the goal of sustainability. However, he does not share their depth of cynicism over sustainability reporting.

"I think it does help promote a move towards sustainability when financial markets begin asking companies to report how they are managing long-term environmental and social challenges, from climate change to employee diversity," Mr. Lippman told "And with a growing number of investors, employees, business-to-business customers, and others looking at sustainability reports, I think companies that try to greenwash only paint themselves into a corner where they have to take more action to meet the expectations they've raised for themselves with their key stakeholders."

In the end, the differences between Mr. Lippman's perspective and those advanced by Profs. Gray and Bebbington boil down to evolution versus revolution. Sustainability reporting either moves corporations toward the ultimate goal of social and environmental sustainability, or it impedes progress because this goal cannot possibly be achieved until the current capitalist structure is replaced by one prioritizing sustainability over profit.

What that new structure might be remains undefined by Profs. Gray and Bebbington in this paper. In the meantime, they argue for sustainability reporting that takes accountability for the extent to which corporations cannot be sustainable. Even this, though, may prove an elusive goal.

Note created Jul 13, 2006
Some Applaud Rise in Sustainability Reporting, Others Say It Masks Corporate Unsustainability -

Ford to pump £1bn into 'green' cars: The investment is a significant chunk of the US company's $8bn-a-year global

Ford to pump £1bn into 'green' cars

By James Mackintosh

Published: July 17 2006 03:00 | Last updated: July 17 2006 03:00

Ford Motor will today announce it is to spend £1bn over the next six years on British research and development projects designed to improve the fuel efficiency of its vehicles.

The investment is a significant chunk of the US company's $8bn-a-year global R&D budget and is mostly re-allocated from other projects. Executives said some planned investments - including new models based on existing vehicles - had been delayed or scrapped to free cash for environmental spending.

The investment follows a rethink of Ford's approach to the environment, which also led this month to the company dumping a commitment by Bill Ford, chairman and chief executive, to be able to produce 250,000 hybrid petrol-electric cars a year by 2010.

Ford has the worst US fuel efficiency of any carmaker and is frequently targeted by environmental protesters, in spite of the personal interest of Mr Ford in the issue.

The money will be an important boost for the UK's beleaguered car industry, which has suffered severe losses in the past decade, including two assembly plants owned by Ford.

Ford, whose empire includes the three British luxury brands Land Rover, Jaguar and Aston Martin, remains the country's fourth largest R&D spender.

Carmakers around the world have increased spending on environmental projects significantly as the record oil price has prompted customers to search for more fuel-efficient cars, while governments have raised concerns over global warming and oil imports.

The £1bn will be spent at Ford's existing Dagenham, Dunton, Gaydon and Whitley bases in the UK. The focus will be on improving traditional petrol and diesel engines and lowering the weight of cars through advanced materials and aluminium.

Hybrid cars, which use an electric motor to improve the efficiency of an ordinary engine, and biofuel cars will also feature, but the main development centres for these remain at Ford's Dearborn, Michigan, headquarters and its Volvo subsidiary in Sweden.

Richard Parry-Jones, head of product development and chief technical officer, led an analysis of what Ford needed to do in Europe to meet long-term carbon dioxide reduction targets.

Ford's record of reneging on environmental commitments, such as Mr Ford's promise to improve sport utility fuel efficiency, made the company particularly careful in its analysis, according to Mr Parry-Jones.

"We have gone back and looked at the root causes of why these things have not transpired in the past," he said. "It is much more robust now. We want to make sure our business plan and our anti-climate change aspirations are one and the same."

Mr Parry-Jones said the CO2 benefits of improving existing technologies and making cars lighter would be significant. He warned that other automotive investors could be put off Britain by the shortage of engineering and mathematics skills and the perception that the UK is anti-science, after harassment of companies experimenting on animals.

How To Build a Solar Generator

Thanks to Norbert for this one


How To Build a Solar Generator by Kevin Bullis
Affordable solar power using auto parts could make this electricity source far more available.

Friday, July 14, 2006

How To Build a Solar Generator

Affordable solar power using auto parts could make this electricity source far more available.

By Kevin Bullis

A set of prototype solar concentrators installed in Lesotho. (Courtesy of Amy Mueller.)

Demand for solar power is rapidly heating up (see "New Solar Technologies Fueled by Hot Markets"). But constructing and deploying large photovoltaic panels to generate electricity remains expensive. Now two groups at MIT are working on alternative approaches to solar-based electricity that could significantly cut costs -- and put the ability to harvest electricity from the sun into the hands of villagers in poor countries and backyard tinkerers alike.

During a stint in the Peace Corps in Lesotho in southern Africa, Matthew Orosz, an MIT graduate student advised by Harold Hemond, professor of civil and environmental engineering, learned that reflective parabolic troughs can bake bread. Now he plans to use these same contraptions to bring power to parts of Africa baked in sun but starved for electricity. His solar generators, cobbled together from auto parts and plumbing supplies, can easily be built in a backyard.

The basic design of Orosz's solar generator system is simple: a parabolic trough (taking up 15 square meters in this case) focuses light on a pipe containing motor oil. The oil circulates through a heat exchanger, turning a refrigerant into steam, which drives a turbine that, in turn, drives a generator.

The refrigerant is then cooled in two stages. The first stage recovers heat to make hot water or, in one design, to power an absorption process chiller, like the propane-powered refrigerators in RVs. The solar-generated heat would replace or augment the propane flame used in these devices. The second stage cools the refrigerant further, which improves the efficiency of the system, Orosz says. This stage will probably use cool groundwater pumped to the surface using power from the generator. The water can then be stored in a reservoir for drinking water.

The design uses readily available parts and tools. For example, both the feed pump and steam turbine are actually power-steering pumps used in cars and trucks. To generate electricity, the team uses an alternator, which is not as efficient as an ordinary generator, but comes already designed to charge a battery, which reduces some of the complexity of the system. And, like power-steering pumps, alternators, including less-expensive reconditioned ones, are easy to come by.

As a result, the complete system for generating one kilowatt of electricity and 10 kilowatts of heat, including a battery for storing the power generated, can be built for a couple thousand dollars, Orosz says, which is less than half the cost of one kilowatt of photovoltaic panels.

"You can't afford something that's designed for solar. You have to buy something that's mass-produced for something else -- that way the cost is reasonable," says Duane Johnson, owner of Red Rock Energy, in White Bear Lake, MN, who developed and sells thousands of the inexpensive LED-based sun-tracking devices Orosz uses to orient the solar concentrators. Most of the devices are used to position photovoltaic panels, he says, but some people are using them with old satellite dishes to concentrate heat and make steam. Sales of his devices have been growing 25 percent a year, a rate similar to that of the solar photovoltaics industry.

Repurposed auto parts aren't the only way to go. Amy Sun, a graduate student in MIT's Media Lab, has designed an inexpensive system that uses heat from a solar concentrator to drive a type of turbine originally patented by Nicola Tesla. Rather than making complex, difficult-to-manufacture bladed turbines, Sun turned to the Tesla turbine, which consists of simpler flat disks stacked like records on a central shaft. The disks are carefully spaced to allow steam to flow between them. As the steam flows, friction between the steam and the surface of the disks causes them to rotate. "Once I have rotational shaft work, I can couple it to almost anything -- an air pump, compressor, fan, mixer, grinder, sewing machine, refrigeration compressor, and, to power those very few things that are truly electric in nature, an electric generator." She calculates that this system, which she says is simple enough for an eight-year old to make, can produce cheap power.

Of course the overall economics of these solar generator systems depend on how long they will last and how much maintenance they will require. The lifetime for Orosz's system could be quite good, since it uses parts designed for rugged service in vehicles. It also works at relatively low temperatures that, in addition to making it safer and easier to work with, won't strain the performance limits of the plumbing used.

Having already built a working prototype, Orosz's next step, which he hopes to accomplish starting this September in Lesotho, is to optimize manufacturing and set up a financing system, drawing on a recent $100,000 World Bank grant, to make the system affordable to villagers who would likely use the generator in a community center and as a battery-charging station.

Although their system was originally designed for Lesotho, Orosz and his colleagues believe it might appeal to amateurs elsewhere. "Backyard tinkerers could build it themselves. No doubt about it," says Amy Mueller, an MIT graduate student who's taken on a leading role in Orosz's project. "Matt's dad has one of these that we built to heat his Jacuzzi."

Supermarket giant plans to make trading fairer for British farmers

Supermarket giant plans to make trading fairer for British farmers

James Meikle
Monday July 3, 2006

The Guardian

British farmers may soon be given a "fair trade" kitemark similar to the kind that guarantees stable prices, extra income and minimum employment and environmental standards for producers in the developing world. The supermarket giant Asda has sought advice from the Fairtrade Foundation, which polices the scheme in Britain, to see whether it can adapt its principles for homegrown produce.

The initiative coincides with a call yesterday by Sir Stuart Hampson, chairman of the John Lewis partnership, which owns Waitrose, for supermarkets to show that "Fairtrade applies to UK farmers as much as it does to developing countries". Asda's move and Sir Stuart's appeal coincide with an inquiry by the Competition Commission into the grocery industry.

The Fairtrade Foundation will not want to sacrifice its trademark identity for helping those in developing countries, a determination it has previously shown in discussions on ethical trading with the Soil Association, the flagbearer for the organic movement. But Asda believes there may be scope for a "fairer trade" initiative that would not confuse consumers. A spokesman said it was also discussing ideas with the Soil Association.

"It is not incompatible to have two standards, both based on Fairtrade principles," said the spokesman. But Harriet Lamb, executive director of the Fairtrade Foundation, said this would be "very confusing" for consumers.

Sir Stuart, who is also president of the Royal Agricultural Society of England, made his remarks introducing a report he commissioned into a sustainable future for farming, after years in which incomes have dived and foreign imports soared. Research suggested that while 86% of consumers believed Britain should be a farming country, only 18% of UK consumers actively "bought British".

Martin Howard, director of policy at the National Farmers' Union, said: "The NFU would welcome a scheme where these kind of principles are applied, whether it be a Fairtrade logo or something similar." Last year, Britons bought £200m of Fairtrade goods, 40% up on 2004.

Special report


Useful links

Department of Trade and Industry
Competition commission
Tescopoly campaign

Supermarket websites

Note created Jul 5, 2006
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It is 2010 and CSR is dead, having lived a successful and important life. A group of leading contemporaries of CSR have composed an obituary

An obituary: CSR is dead
EC Newsdesk
6 Jul 06

It is 2010 and CSR is dead, having lived a successful and important life. A group of leading contemporaries of CSR have composed an obituary. Jeremy Sweeney reports
They write:

"The founder of the corporate sustainability movement, Corporate Social Responsibility, died this year aged 50, after a long struggle with definition.

Initially very much an outsider, CSR spent the early years largely ignored in favour of the initially more attractive Pure Capitalism.

However, eventually corporations came to recognise and value the important work done by CSR in the ethics of resource and people management; even if the reasons for doing so often reflected more of a desire to protect reputations, than because they respected or even liked CSR.

Whatever the cause of the newfound popularity, CSR helped ensure that more resources were made available to create more equality of opportunity and improved life chances for more people in the world.

In doing so, the relationship between businesses and the people on whom they depended, was undoubtedly enriched.

CSR is credited with re-humanising a business world that had become perilously detached from the physical and cultural environment in which it operated.

CSR was also a founder member of the movement that believed that it was possible to come to work because you enjoyed it; and nurtured the idea that people would prefer to work in, and conduct business with, corporations that wanted to do good as well as maximise short term profits – hence coining the phrase ‘enlightened self interest’.

In the later years, CSR's reputation for valuing privacy came under scrutiny as various more or less satisfying relationships with Business and Government developed.

However, despite many approaches, marriage never materialised.

Having indulged in the occasional, though much loved, ‘refresher’, CSR was often heard to say about the many suitors, “They all want me now, but how can I trust that it is for the right reasons?”

CSR is survived by an adopted child, Sustainability.

Jeremy Sweeney runs JMS rescources, a consultancy.
Note created Jul 6, 2006
Ethical Corporation: By Invitation - An obituary: CSR is dead -

Is our children learning? After $12 billion of World Bank money, and the promise of more to come, donors still don't really know

Is our children learning?
Jul 13th 2006
From The Economist print edition

After $12 billion of World Bank money, and the promise of more to come, donors still don't really know

A lot of turtles lived on the bank of a big lake. Boys would go to the bank and look at the turtles. Sometimes the turtles would walk around and at other times retreat into their shells, as if they were stones. On seeing this, the boys would laugh loudly and clap. They would go home and tell everyone the story of the turtles.

NOT the most thrilling narrative perhaps, but less than half of Indian schoolchildren between the ages of seven and 14 could read this passage in their native language even if they wanted to. That was one discouraging result of a national study of literacy and numeracy published by Pratham, an educational charity, earlier this year.

Education for all is a popular cause. So popular, indeed, that every decade or two, governments and donor agencies promise to put all the world's children in primary school by some date, normally ten or 15 years hence. In 1990 they set a deadline of 2000. In 2000 they set one of 2015. All that is required, the donors say, is money and will.

The money may be forthcoming. In April Gordon Brown, Britain's chancellor of the exchequer, promised to spend $15 billion over the next ten years to help realise this goal. Russia, which is hosting the G8 summit in St Petersburg between July 15th and 17th, has put the subject on the agenda and $7m of its money on the table. But throwing money at the problem is not unprecedented. Since 1990 the World Bank has spent over $12 billion on primary education. What has it accomplished? This week its Independent Evaluation Group (IEG) gave its verdict.

Many more children are going to primary school. In the 12 countries the IEG studied in depth, enrolment rates rose by an average of 19 percentage points over the past ten to 12 years. In 1996 Uganda abolished fees for primary education. As a result, enrolment almost doubled in a year, according to official figures (which some scholars distrust). Both Kenya and Ghana have since followed Uganda's lead.

Cutting fees is now touted as a “quick win”, one of precious few easy victories in development. Indeed, far from charging people to attend school, some governments, with donors' help, now bribe them to enrol. They offer free meals or cash handouts to parents on the condition they keep their children in school. In Nicaragua, the IEG reports, a pilot programme along these lines raised enrolment rates by about 22 percentage points.

Governments and donors have been remarkably successful at getting children into school. But what do they learn when they are there? Pratham's study in India is one of few serious attempts to find out. Only five of the 12 countries visited by the IEG had carried out repeated, standardised tests to monitor their progress in educating pupils, rather than merely enrolling them. Parents cannot fill this gap. Their children are often the first members of their family to get an education. As a result, parents do not know what to demand from their schools. In Uttar Pradesh, a state in India, 41% of children could not read a single paragraph, but only 21% of parents think their offspring cannot read.

Uganda's explosive increases in the quantity of schooling came at the expense of an implosion in quality. Three years after the big bang of 1997, for example, the Bundibugyo district of Uganda had 209 pupils for every classroom. In 2005 there were, on average, three students per textbook in the country.

Faced with ratios like these, the obvious response is to build more classrooms and print more textbooks—in other words, to increase the “inputs” to education. In Uganda the obvious response is probably the right one. But it may not be sufficient. In the past few years trials have shown that simply spending more on textbooks, flipcharts or extra teachers does not necessarily raise test scores for the average pupil.

But these scholarly results rest uneasily with donors' habits. On the whole, they are better at procurement than at pedagogy, better at school-building than schooling. In Peru the bank helped to improve buildings, distribute textbooks and provide training. But Peru's teachers remained ill paid, poorly motivated and barely supervised, and were rarely held to account. Some refused to use free textbooks, preferring to collect commissions from commercial publishers for assigning their books instead.

Learning how to teach

Pratham's response to widespread illiteracy and innumeracy was to experiment. It tried various remedies in half the schools in a district or city, picking which half at random. The remaining schools provided a control group with which to compare the results of its efforts*. One of its more successful ventures was to hire unqualified high-school graduates to provide remedial education for students falling behind. These balsakhis (which means “children's friends”) were cheap, paid about $10-15 a month, and quick to train, receiving only two weeks of prior instruction. Because they did their work in hallways or even under trees, there was nothing for governments or donors to build.

Nonetheless, the instruction they offered was surprisingly effective. In Mumbai it raised the chances of fourth-year pupils grasping first-year maths by 11.9 percentage points. It improved their chances of mastering second-year literacy by 9.9 percentage points. The gains in Vadadora (formerly known as Baroda) were smaller, but still worthwhile.

Pratham's remedy may not apply to Africa, where fully trained teachers are still relatively cheap. But the charity's approach—measure, experiment, evaluate—should. Thanks to the balsakhis, more of India's children are learning to count and read—well enough at least to enjoy turtle stories. Whether donors are also learning any lessons remains to be seen.

* “Remedying Education”, by Abhijit Banerjee, Shawn Cole, Esther Duflo and Leigh Linden. NBER working paper 11904, December 2005.

Note created Jul 17, 2006 | Articles by Subject | Economics focus -

Financial Institutions Revise Equator Principles for Environmental and Social Risk Management

Financial Institutions Revise Equator Principles for Environmental and Social Risk Management, 10 July 2006 - The Equator Principles Financial Institutions (EPFIs) has announced the launch of the revised Equator Principles, a benchmark for the financial industry to manage environmental and social risk. The revision underscores how far the financial sector has progressed in embedding in the project finance arena a common set of best practices to manage social and environmental risks related to project financing.

The revised principles reflect the experience of the 40 financial institutions around the world that currently apply the Principles. The principles also reflect the recent revisions to the International Finance Corporation's (IFC) Performance Standards, upon which the Equator Principles are in part based. In developing these changes, the EPFIs actively involved clients, civil society groups and official development agencies, all of whom provided constructive and valuable feedback that the EPFIs reviewed and considered in the revision process.

The Equator Principles apply globally and to all sectors and have been revised in the following ways:

  • The Principles apply to all project financings with capital costs above $10 million. This threshold was lowered from $ 50 million.
  • The Principles now also apply to project finance advisory activities.
  • The revised Principles now specifically cover upgrades or expansions of existing projects where the additional environmental or social impacts are significant.
  • The approach in applying the Principles to countries with existing high standards for environmental and social issues has been streamlined.
  • Each EPFI is now required to report on the progress and performance of Equator Principles' implementation on an annual basis.
  • The Principles apply stronger and better social and environmental standards, including more robust public consultation standards.
The EPFIs are proud of the progress the Equator Principles have made in the past three years. The development and application of the Equator Principles have been a huge step forward for the industry, in terms of having a common framework and language for environmental and social issues in the project finance industry. The Equator Principles have enabled the financial institutions to better assess, mitigate, document and monitor the potentially adverse social and environmental risks associated with financing projects.

Participating financial institutions commit to financing only those projects that comply with the Equator Principles, and commit to implementing the revised Equator Principles into business and risk management processes in a manner consistent with its organizational structure. Of the 40 financial institutions that have shared their experience in devising the revised Equator Principles, 33 have today adopted them and the others are expected to do so in the coming weeks.

The full text of the revised Equator Principles and FAQ about the Equator Principles can be found online.

Note created Jul 13, 2006
Financial Institutions Revise Equator Principles for Environmental and Social Risk Management -

UK Says Atomic Power Needed to Fight Global Warming, but Nuclear Focus May Boost Emissions; Environmentalists express dismay at 'a huge mistake'

UK Nuclear Focus May Boost Emissions - Green Groups
UK: July 12, 2006

LONDON - A decision by the UK government to build new nuclear power plants will increase pressure on uranium reserves and the need to process lower grades will cause greenhouse gas emissions, environmental groups said on Tuesday.

A spokesman for British Prime Minister Tony Blair said ahead of an energy policy review on Tuesday that Britain would have to build new nuclear plants as part of a strategy to fight global warming and keep the lights burning.

But with the price of uranium already soaring and plans to build over 120 new nuclear power plants around the world over the next 10 years, the economics and emissions benefits of nuclear energy may be in doubt, green groups said.

"Although we may not run out of uranium altogether, we could quickly run out high-grade, easily exploitable uranium," Roger Higman, campaign co-ordinator at Friends of the Earth, said.

He referred to studies showing that once high-grade uranium ore bodies had been exploited, lower-grade reserves would require a massive energy input to convert into fuel.

"That would affect the greenhouse impact of the nuclear sector and would make nuclear energy much more expensive."

Uranium prices have risen from US$8-10/lb four years ago to US$45.50 this week, according to US uranium consultancy UxC, and may head even higher.

"The key question is whether the high prices of uranium reflect a medium-term imbalance in supply and demand or whether this is a fundamental issue to do with dwindling reserves of uranium," Keith Allott, of environmental group WWF, said.

"High prices are likely to be a major factor in the economics of new nuclear plants. If the world embraces nuclear power as a so-called solution to climate change, we need to grapple with the fact that uranium is a finite resource."

INVESTMENT NEEDED Soaring oil prices and international attempts to reduce greenhouse gas emissions have thrown the spotlight back onto nuclear energy.

Proponents of nuclear energy say plenty of uranium is available, but the extended period of low prices has deterred investment in new mines.

"What is needed is new mine production, and at these prices there are huge profits available for miners so production will be strongly stimulated," Steve Kidd, director of strategy and research at the World Nuclear Association, said.

"The lead times for a uranium mine and nuclear reactor are about the same, so new mine capacity will come on stream at the same sort of time that the reactors come on."

He said the UK could see its first new reactors by 2015 at the earliest.

World uranium consumption is running at around 65,000 tonnes per year, while production is 41,000-42,000. The shortfall is made up from stockpiles held by utility companies and down-blended weapons-grade uranium.

A typical reactor consumes about 200 tonnes of uranium per year, but requires an initial charge of around 600-800 tonnes.

"Fuel prices don't affect nuclear energy economics. Fuel costs represent only a small component of the overall costs. Even if prices double it would remain a single digit percentage of the total cost," a source in the nuclear industry said.

"The miners are happy with these prices and there is little pressure from the utilities to push them down either."

Story by Nick Trevethan


Note created Jul 12, 2006
Planet Ark : UK Nuclear Focus May Boost Emissions - Green Groups -

UK Says Atomic Power Needed to Fight Global Warming
UK: July 12, 2006

LONDON - Britain said on Tuesday it needed new nuclear power plants, more electricity from wind and waves and cuts in energy consumption to fight global warming and reduce rising dependence on imported oil and gas.

But scientists and environmentalists dismissed the conclusions of the government's six-month review of future energy supplies as either too timid or simply misguided. "We face two big challenges, climate change and the need to provide secure cleaner energy at affordable prices," Trade Minister Alistair Darling told parliament.

"Our analysis suggests that, alongside other low carbon generating options, a new generation of nuclear power stations could make a contribution to reducing carbon emissions and reducing our reliance on imported energy," he said.

Nuclear power accounts for 20 percent of Britain's electricity, but that is due to slump to just 6 percent as all but one of the ageing plants closes within 20 years.

The decision to back a new fleet of nuclear power plants will boost the global nuclear industry as it starts to recover from the 1986 explosion at the Chernobyl nuclear plant.

Nuclear power, seen by some as a weapon in the fight against global warming because it emits no climate changing carbon gases, and energy security will also dominate the agenda at the Group of Eight summit of rich nations in Russia this weekend.


But nuclear power is politically divisive, particularly within Prime Minister Tony Blair's Labour Party. Environmentalists say it is too dangerous to consider.

"The Energy Review is a damp squib," said Keith Allot of environmental group WWF-UK, "The government's continued dalliance with new nuclear power is a massive distraction from delivering a truly sustainable energy future."

David Wallace, vice president of the Royal Society, Britain's premier science academy, echoed the sentiment.

"While the government has recognised the twin challenges of climate change and energy security, this review is weak on commitment to renewables," he said.

The nuclear industry welcomed the outcome, but the opposition Conservatives, and several energy sector analysts, said there was little meat in the announcement.

"This review seems to have done almost nothing, it is a grave and perilous letdown," Conservative energy spokesman Alan Duncan said.

Darling said renewable energy sources, that supply only 4 percent of Britain's electricity, should do far more but would not be able to plug the 30 percent gap between supply and demand as old nuclear and coal plants close.

The government wants power companies to get more of their supplies from renewables and boost local generation such as rooftop wind turbines and solar panels.

It also wants to streamline the planning process to avoid lengthy and costly delays in building renewable energy plants.

But it is also in a dilemma because it has repeatedly ruled out any public subsidies for new nuclear power stations in view of the 70 billion pounds (US$128.7 billion) it will cost to clean up the 50 years of lethal waste from existing reactors.

"Without massive public subsidies it is very doubtful that private sector companies will take the huge financial risks of building new nuclear reactors," said Tony Juniper of Friends of the Earth.

Generators including British Energy and EdF have said they would be prepared to commit private finance to building new nuclear plants in return for contracts guaranteeing prices.

Analysts say this would be a subsidy by another name. (US$1=.5439 Pound)

Story by Jeremy Lovell

Note created Jul 12, 2006
Planet Ark : UK Says Atomic Power Needed to Fight Global Warming -

Green reaction: Environmentalists express dismay at 'a huge mistake'
By Jonathan Brown
Published: 12 July 2006

Environmental groups reacted with dismay at the plan to go ahead with a new generation of nuclear power stations.

Friends of the Earth's director, Tony Juniper, described the conclusion of the Energy Review as a "huge mistake" and a "disaster". He said: "Nuclear power is unsafe, uneconomic and unnecessary. We can tackle climate change and meet our energy needs through clean, safe technologies."

Mr Juniper said the British taxpayer would be left to pick up the nuclear bill, and called for a new climate change law requiring annual reductions in carbon dioxide emissions.

Greenpeace's executive director, Stephen Tindale, blamed the Prime Minister's personal "fixation" with nuclear power for "fatally undermining" green energy policy. "When Tony Blair leaves office Britain can get on with tackling climate change and fostering energy security without reaching for the technologies of the past. Blair fixed his own energy review to make it a manifesto for nuclear power," he said.

The Green Alliance director and former Defra special adviser Stephen Hale said the Government's support for nuclear power would deter investment in other forms of energy. "Climate change is the pretext for the Government's position on nuclear. But a rethink of the aviation White Paper would be far more effective as part of a climate strategy," he said.

Even the Government's principal advisory body, the Sustainable Development Commission, chaired by Jonathon Porritt, said it was "very disappointed" by the decision to back a new nuclear programme.

Welcoming some of the proposals on renewable energy, Mr Porritt said: "The principal challenge now is delivery, not further policy refinement."

The Green Party spokesman, Keith Taylor, said the Government was living in a "fool's paradise" in its attempt to use nuclear power to combat climate change.

"[Nuclear] eats up cash - which could be far more effectively used elsewhere - and it already has high carbon emissions from construction and fuel processing. Indeed, the limited supplies of high-grade uranium will soon be exhausted, forcing exploitation of lower grade uranium sources - raising both costs and carbon emissions even further."

Paul Jefferiss, head of environment policy at the Royal Society for the Protection of Birds, warned that wildlife sites should not be sacrificed to make way for wind farms. "Any statement of national renewables need should be accompanied by a strategic environmental assessment," he said.

Note created Jul 12, 2006
Independent Online Edition > Environment -

UK energy review answers some EU Green Paper questions, 13 July 2006 - A new generation of nuclear power plants, promoting the use of renewable energy and a stronger energy saving policy are the main elements of the Labour government's energy review presented on 11 July.


Tony Blair's government announced his country's energy review in November 2005. Although a White Paper on Energy had been published in 2003, the Labour government felt that high oil prices combined with the fast depletion of Britain's North Sea gas reserves mandated a new look at the country's energy policies.

It became clear from the beginning that the review would be quite controversial, as the Prime Minister had expressed early on his intention to put nuclear back on the policy agenda. The urgency of Britain's energy concerns also fed into a renewed European debate on a Common EU Energy Policy. During the UK's EU presidency in the second half of 2005, Mr. Blair convinced his colleagues heads of state and governments to re-open the discussion on a new European energy strategy.

The UK's new energy review can be seen as the UK's answer to the European Commission's latest "Green Paper on Sustainable, Competitive and Secure Energy" (March 2006).


The main elements of the new UK energy review, presented on 11 July 2006, are:

  • Saving energy through better information campaigns, "smart metering", incentives for energy suppliers to promote "energy efficiency" instead of just selling more energy;
  • Cleaner energy: with a focus on distributed energy generation and the use of low-carbon alternatives;
  • Renewable electricity: 20% of electricity to come from renewables by 2020; increase in the level of financial support for some renewables (esp. offshore wind and tidal plants);
  • New nuclear power stations, but the private sector will have to fund, build and operate the plants and cover decommissioning and waste management costs; the government will overhaul the planning rules for new nuclear plants; the review does not state how many new plants can be constructed;
  • Cleaner fossil fuels: government to look into commercial and regulatory barriers for the development of carbon capture and storage (CCS);
  • Alternative fuels for transport: proposal for a Transport Innovation Strategy to bring forward cleaner technologies and fuels;
  • Emissions trading: a mandatory emissions trading scheme (Energy Performance Commitment) might be introduced for businesses and public services not currently covered by the European emissions trading system.

Although the nuclear power industry welcomed the review's revival of nuclear power, some of their industry leaders raised questions about the government's decision to leave the financial risk to the investors and demanded more incentives.

The voice of British Industry, CBI, called the review a "promising start" but warned against "drawn-out consultation". The government should make the final decisions before the end of the year, according to CBI.

The UK's Trade Union Centre (TUC) stated that the government has the "energy balance right", but questioned whether the UK still has the "skills and research infrastructure to deliver the new technologies on which the strategies rely."

UK MPs warned the government not to take any hasty decisions on the UK's energy strategy. In a new report for the UK House of Commons Committee on Trade and Industry, the British MPs criticised the lack of "proper assessment of the projected future capacity" and underlined the need for cross-party and public support for the new nuclear strategy.

Greenpeace UK called the review "a farce from the beginning", as it was "a rubber-stamping exercise for a decision the Prime Minister took some time ago". Stephen Tindale, Greenpeace executive director said: "The reality is that nuclear sucks up all the money. There is an enormous radioactive cloud hanging over this energy review which threatens to drown any positive moves on decentralised energy, renewables and energy efficiency".

The UK's Tyndall Centre for Climate Change Research also criticised the review, saying it is more "an electricity review" than a energy review, neglecting 82% of Uk energy use in heat and transport. The think tank also sees energy saving commitments as seriously flawed. "Energy saving is once again the Cinderella issue. Last but not least, Tyndall thinks that nuclear's small contribution to UK energy (only 3.6%) is "irrelevant to UK carbon targets".


EU official documents

Governments Note created Jul 13, 2006
UK energy review answers some EU Green Paper questions -

Britain champions nuclear, renewable energy in major review

AFP, 11 July 2006 - Nuclear power "could" make a significant contribution to Britain's energy needs alongside renewable energy sources, the government said Tuesday in a long-awaited review of its energy policy.

The wording was softer than bullish comments made by Prime Minister Tony Blair in May that nuclear energy was "back on the agenda with a vengeance", and appeared aimed at appeasing environmentalists who oppose the atomic option. But Blair warned Tuesday that any decision to rule out new nuclear power stations would be a "huge risk".

He wants Britain to rely more on nuclear power rather than expensive and dirty carbon fuels in a bid to combat climate change and reduce the country's dependence on often volatile foreign energy imports.

Environmental groups argue that there are better ways to do this, such as greater investment in renewable energy and a reduction in consumption.

But Blair countered: "With the best will in the world -- and we're going to make a big increase in the use of renewables -- you're not going to be able to fill all the gap."

He told critics to "just face up to the facts" in a BBC television interview.

"If we're going to go from being self-sufficient in gas to importing it, if prices are rising, if we know that climate change is an even more serious problem than we thought a few years ago, how can we take nuclear out of the mix? Isn't that a huge risk to take?"

"And if you take the wrong decision now, and it turns out to be wrong in 15 or 20 years' time, then of course it's too late to do anything about it."

"We would be completely dependent on imports of possibly very highly-priced gas, with all the issues of security of supply because of where the gas comes from."

Trade and Industry Secretary Alistair Darling, who unveiled the review in parliament, said: "The government has concluded that new nuclear power stations could make a significant contribution to meeting our energy policy goals."

He warned that Britain would lose about one-third of its capacity to generate electricity over the next two decades as ageing coal and nuclear power stations close down.

"Decisions will have to be taken on the replacement in the next few years," Darling told the House of Commons, noting that a wider use of renewable energy -- such as solar, tidal and wind power -- would help to fill the gap.

"Far from getting rid of the renewables obligation, as some have proposed, we intend to increase it from 15 percent to 20 percent," the minister said. At the same time, without, for example, a new generation of nuclear power plants, Britain would also need to rely more on imports of gas from potentially unstable parts of the world, increasing the risk to its energy supply.

The review, ordered by Blair late last year in the face of shrinking North Sea oil and gas reserves, did not mention how many new stations were desired.

The Observer newspaper, however, reported at the weekend that the Department of Trade and Industry was considering building six.

Darling said any investment in replacement nuclear capacity would be funded by the private sector rather than government subsidies.

The report explores Britain's energy needs for the next 30 to 40 years. A statement of government policy is due to be published around the end of the 2006 after further consultation.

Darling said the country faced two main challenges -- the need to tackle climate change and cut carbon emissions.

Britain's electricity-guzzling households and businesses must be encouraged to reduce their energy consumption through incentives offered by power companies, the minister said, noting that seven percent of electricity is wasted on electrical appliances that are left on standby.

Cleaner energy was also important, with the review setting a target of 20 percent of electricity to come from renewable sources by 2020. Such environmentally-friendly overtures failed to appease critics who
focused on the nuclear references.

Britain has about a dozen nuclear power stations, most of them built in the 1960s and 1970s. They provide around 25 percent of the country's electricity. Proponents of new reactors, which emit virtually no carbon dioxide, say they would help Britain meet a pledge to reduce greenhouse gas emissions by 20 percent of 1990 levels by 2010.

Note created Jul 17, 2006
Britain champions nuclear, renewable energy in major review -

The Un-Coal: By investing in energy efficiency, we could vastly reduce carbon dioxide emissions and save money

Another good one from Norbert :-)


Saturday, July 15, 2006

The Un-Coal

By investing in energy efficiency, we could vastly reduce carbon dioxide emissions and save money.

By David Talbot

There is a low-tech way to sequester carbon dioxide: don't dig up so much coal and oil in the first place. Princeton University's Carbon Mitigation Initiative concludes that using the most efficient building technologies for commercial and residential buildings could avert as much carbon dioxide as is produced by 800 one-gigawatt coal power plants. Doubling automotive efficiency -- possible with existing technology -- would achieve the same. Do both and you've canceled out the emissions of 1,600 coal power plants -- more than all the coal plants proposed globally today.

Clearly, even partial deployment would yield enormous benefits. So what's the problem? "The classic reason why efficiency didn't fare well [is that] it took five guys in a corporate boardroom to spend a couple billion bucks to build a power plant that can power 250,000 homes," says Steve -Selkowitz, who manages building--efficiency research programs at Lawrence Berkeley National Laboratory in Berkeley, CA. "Getting 250,000 homeowners to each change 10 light bulbs and buy a more efficient refrigerator and air conditioner takes much more effort."

And right now, federal policy mostly helps the five guys in the boardroom. Consider federal tax credits and funding for energy-related activities: according to the Alliance to Save Energy, an energy--efficiency organization, most energy tax breaks go to efforts to bolster energy supply, pri-marily fossil fuels. Only 14 percent go to efforts to increase efficiency and reduce consumption, even though the benefits would be the same or better in terms of cost, and the measures would prevent -- rather than add to -- carbon dioxide and other emissions.

Consider what's possible with lighting alone. Half of U.S. electricity comes from coal. Two-thirds of U.S. electricity is consumed in commercial and residential buildings. In commercial buildings, 35 percent of electricity goes to lighting (the figure is 20 percent for homes). Selkowitz says that with an aggressive effort, lighting consumption in commercial buildings could readily be cut -- by half -- through better designs, more-efficient light sources, and smart sensor and control systems. That strategy alone, fully deployed, would replace 40 one-gigawatt coal plants.

But are efficiency investments really cost effective? A 2001 National Academies study found that just three small U.S. Energy -Department--funded R&D programs that produced technologies now widely deployed -- electronic ballasts for fluorescent lamps, efficient refrigerator compressors, and low-emissivity (low-E) coatings for windows -- have achieved cumulative energy savings of $30 billion. Despite this lesson -- to say nothing of the -climate-change issue -- the White House wants to cut efficiency efforts further. In its proposed fiscal 2007 budget, research at the Energy Department's Energy Efficiency and Renewable Energy office would get $517 million, down $112 million. Efficiency incentives would get trimmed, too.