Category Archives: Green Finance

The best camera business model

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Well, Chase has just shown the way forward. Raised the bar a skyscraper’s height, but still, he has shown how to take the new media of social networking  and create something financially rewarding AND actually meaningful because people responded, en masse, to participate. And anytime you can create a community around something you have shown that you are doing something worth doing.

We all need to pay attention to this development. I mark it as the most significant synthesis of new media thinking and action within the photo community since… Photoshop?? Well, you can decide if I’m smoking something or not for yourself, but please check out what Chase is doing, it’s truly groundbreaking.

via DOUG MENUEZ 2.0: GO FAST, DON’T CRASH.

Carbon credits incentive drives Indian cities to CNG buses

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Cities plump for Central scheme, take to CNG buses – Home – livemint.com

The opportunity to earn money by selling carbon credits, growing environmental awareness and the novelty value of buses fuelled by compressed natural gas (CNG) may have prompted some 14 cities to order hundreds of CNG vehicles, taking advantage of a one-time funding scheme offered by the Centre.

The opportunity to earn money by selling carbon credits, growing
environmental awareness and the novelty value of buses fuelled by
compressed natural gas (CNG) may have prompted some 14 cities to order
hundreds of CNG vehicles, taking advantage of a one-time funding scheme
offered by the Centre.

Green fleet: Low-floor CNG buses run by Delhi Transport Corporation. Ramesh Pathania / Mint

Green fleet: Low-floor CNG buses run by Delhi Transport Corporation. Ramesh Pathania / Mint
The cities that have placed orders for CNG buses include Visakhapatnam, Delhi, Indore, Ujjain, Thane, Navi Mumbai, Pune, Pimpri Chinchwad, Agartala, Tripura, Agra, Kanpur and Lucknow, according to urban development secretary
M. Ramachandran. Many of these cities are getting CNG vehicles for the first time, he added.

CNG is a substitute for petrol and diesel, and considered to be a more environmentally clean alternative to those fuels. Trading of carbon credits awarded for controlling emissions offers a potentially lucrative opportunity for cities that switch to CNG-fuelled public bus fleets.

“We have a carbon credit system that is under validation and if we go for CNG, it helps us in getting money,” said S.C. Garg, chief technical adviser for Indore’s city transport service. The municipality also reasoned that the prices of
diesel, which is the preferred fuel for most bus operators, are likely to increase at a faster rate than the price of CNG. “Also, we can tell people to come and sit in a CNG bus for the first time,” he added.

The Australian ETS is coming

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Business Spectator – Lifting the carbon fog – Giles Parkinson

Amid all the political posturing about to take centre stage as the government’s emissions trading bill works its way through the House of Representatives, there have been moments of great clarity in the debate in recent days that business will do well to take on board.

The first was the admission from opposition leader Malcolm Turnbull that an emissions trading scheme is inevitable. If not now, then sometimes very soon.

If this was a statement of the bleeding obvious to those who have followed the issue closely, the admission bursts through the political fog as a clarion call to business: There will be a carbon price in the global economy that needs to be factored into all aspects of the business, and up and down the supply chain, and with carbon-conscious business customers at home and abroad. This will create impacts and opportunities, and the sooner Australian business comes to grips with it – particularly with its dependence on fossil-fuelled energy – the better.

The second piece of clarity in the debate was the emergence of Santos CEO David Knox into the public arena on the issue of the ETS and its potential delay.

Green Govt Grants in Australia

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The latest AusIndustry newsletter carries some good information on the green funds and grants available from the Australian government. Adelaide information sessions are provided here. The links would provide information in other cities.

I was involved in the Climate Ready round last time and it is an interesting exercise.  There is quite a bit of work involved so you should plan ahead.

Green Car Innovation Fund

On 24 April 2009 Minister Carr opened the Green Car Innovation Fund for applications. Grants from $100,000 are offered to develop low-emission, fuel-efficient cars and components in Australia.  Participants in this very significant grants program will include businesses both inside and outside the automotive sector.

An Information Session will be held in Adelaide on Monday 4 May 2009.  For further information, please contact the AusIndustry hotline or Kerrie Trevena in our Adelaide Office, on 8406 4723.

Climate Ready

The Climate Ready program is open for applications under round 4 until 25 June 2009.  Grants from $50,000 are available to develop technological solutions to address climate change challenges.

An Information Session will be held in Adelaide on Tuesday 5 May 2009. Intending applicants are encouraged to register for the information session and to discuss their proposal with a customer service manager as soon as possible.  For further information please contact Kerrie Trevena in our Adelaide office on 8406 4723.

Three South Australian companies shared in $16.4 million grant funding under round 2 of the Climate Ready Program:

· Seed Technology & Marketing Pty Ltd $376,700 for their Pasture legumes for a changing agricultural climate project.

· Cavitus Pty Ltd $620,919 for High-power ultrasonics systems for the global wine industry.

· SBS International Pty Ltd $891,969 for the Supaloc Eco-Load Bearing Wall project.


Click here to view the full list of round two Climate Ready grant recipients.

TQUAL Grants

TQUAL Grants aim to stimulate sustainable growth in the tourism industry by supporting innovative, high-quality tourism products that contribute to the long-term economic development of Australia.

An Information Session will be held in Adelaide on 12 May 2009.  For further information please contact the AusIndustry hotline or Kerrie Trevena in our Adelaide office on 8406 4723.

2009 Australian Innovation Festival

The 2009 Australian Innovation Festival runs to 30 May and promotes the best of Australian innovation and entrepreneurship. It encourages networking and business opportunities, particularly in research and development, and in technology commercialisation.  The South Australian launch will be held on 29 April at the National Wine Centre.

AusIndustry will present a number of business innovation information sessions during the festival, including Business Innovation Opportunities on Tuesday 19 May.  For further information about the Business Innovation Opportunities information session please contact Kerrie Trevena in our Adelaide office on
8406 4723.

R&D Tax Concession 30 April 2009 deadline

The deadline for submission of applications for registration for the R&D Tax Concession for the 2007-08 income year for June balancing companies is Thursday 30 April 2009.  The R&D Tax Concession allows companies to deduct up to 125% of qualifying expenditure incurred on R&D activities when lodging their corporate tax return. A 175% Incremental (Premium) Tax Concession and R&D Tax Offset are also available in certain circumstances.  Further information is available in the latest edition of the R&D Tax Concession Information Bulletin. Please contact the AusIndustry hotline or our South Australian team for assistance.


Re-tooling for Climate Change

Re-tooling for Climate Change helps small and medium-sized manufacturers improve the energy and water efficiency of their production process.  Grants from $10,000 are available.  The program is open for applications under round 3 until 1 June 2009.  Intending applicants are welcome to contact the South Australian team to discuss their proposals.

Green Building Fund

The Green Building Fund aims to reduce the impact of Australia’s built environment on green house gas emissions, by reducing the energy consumed in the operation of existing commercial office buildings.  The program is open for applications under round 3 until 30 June 2009.  Intending applicants may contact the Adelaide office team to discuss their proposals.

Commercialising Emerging Technologies (COMET)

COMET is a competitive, merit based program that supports individuals, early-growth stage and spin off companies to improve their potential for successful commercialisation of their innovation.  Intending applicants are encouraged to contact the South Australian team.

Tradex

The Tradex Scheme allows an importer to gain an up-front exemption from Customs duty and GST on eligible imported goods that are intended for export.  An application for a Tradex Order may be approved quickly in the Adelaide office, if necessary.  Please contact the AusIndustry hotline or our South Australian team for assistance.  

Green IPOs

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IO: Companies that create or invest in green technology, which is very much in fashion, even they’re not immune?

GW: No. I don’t believe so because unless they’ve actually got a product that’s generating income as opposed to a good idea, then they’re susceptible to any changes in the market and certainly with the finance the way it is and the credit market, there are a lot of companies that aren’t going to be getting the support to go with that debt to develop their products and grow and that’s what people are buying. They’re buying growth.

via Business Spectator – Floating back to earth.

Microfinance or Enterprises

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What is the solution to poverty? Niranjan Rajadhyaksha in the Mint:

Many have asked why Bangladesh continues to be mired in terrible poverty when it has such a large microfinance sector. The good ol’ basics matter more — property rights, open markets, human capital, innovation etc.

A new policy research paper, Who Gets Credit?, published by the World Bank shows that economies benefit more when money is lent to firms rather than households. India is one of the 45 countries the economists have covered in their study.

He quotes Milford Bateman who writes from his research in Bosnia and Serbia.

The East Asian countries managed to develop brilliantly through channelling much, if not most, of their savings into serious growth-oriented sustainable business projects. This is why many East Asian countries may have started at similar GDP levels as Bangladesh in the 1970s but have since massively outpaced Bangladesh in terms of growth and development. Economics 101 shows conclusively how critical savings are to development, but only if intermediated into growth and productivity enhancing projects. If it goes into rickshaws, kisoks, chicken farms, traders and so on, then the country simply will not develop and sustainably reduce poverty.

Better Place in Australia

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Better Place is the idea of sustainable services for transport created by Shai Agassi. I received a mail from Better Place that they will be launching in Australia their services with a partnership with Macquarie Capital Group and AGL. Macquarie will help in raising $1Billion and AGL will provide the renewable energy.

So what is better place?

Better Place is a game changing business model to redraw the concept of transportation. Moving transportation into the area of mobility services.

From their website:

t’s simple. The car has evolved. Gas guzzlers have gone the way of the dinosaur—there’s a reason they call it “fossil fuel.” In their place we have electric versions of our favorite makes and models being developed by established car companies.

And the evolution of the car means the evolution of the entire transportation model. When we eliminate the dependence on oil, we eliminate the environmental and economic damage that came with it.

The good news is we’re evolving into something very familiar. The Better Place business model is one most of us already experience every day—with our mobile phones.

Think of it like this: we pay mobile providers for minute-by-minute access to cell towers connected together in cellular networks. Truth is, we pay comparatively little—or next to nothing—for the phones themselves. After all, what you’re really buying is air time, not a box with buttons.

The same model works for transportation. Just replace the phone with an electric car, replace the cell towers with battery recharge stations, and replace the cellular networks with an electric recharge grid. Now you’re buying miles, not minutes.

When you think of it in those terms, suddenly a seemingly revolutionary business model becomes something a lot more proven—and more than a little appealing.

Why pay for an addictive, expensive and harmful substance like oil when you can simply pay for transportation as a sustainable service? Why produce pollution when you can bring your emissions to zero and produce economic advantage as the only by-product? The proposition sells itself.

• Drivers pay to access a network of charging spots and conveniently located battery exchange stations powered by renewable energy.
• Drivers pay for the miles they drive.
• Cars are made much more affordable—even free in some markets—by the business model’s financial and environmental incentives to add drivers into the network.
• Better Place operates the electric recharge grid that brings it all together.

This is transportation as a sustainable service, with drivers as subscribers, and Better Place as a true “mobility operator.”

The concept is game changing because of its vision and the determination of Shai Agassi to make it happen. An idea like this is in a classic chicken and egg strategy issue and Shai is using this venture backed money, his ability to convince high profile companies and governments and sheer will power to create the infrastructure and then sell the product.

I am excited that this is coming to Australia. With Australia’s high urban concentration, high reliance on cars, one of the highest per capital greenhouse gas emissions and multiple opportunities in renewable energy (solar, geothermal, wind etc) it is well suited to this environment.

What is more interesting is the whole idea of selling electric vehicles as a subscription service. The whole world is moving towards this. In fact, the idea behind TechNovus, the company I started is to sell a computer as a subscription service.

I have been using a quote from Druker in my email signature for a while – “The only way to predict the future is to create it”. And this is what Better Place is all about.

Australia does not have many innovative business models happening. This is a great bet by Shai and his partners. What is going to happen? I am going to follow this.

Khosla’s Black Swans

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Vinod Khosla talks about his investments in alternate energy in terms of Black Swans.

Speaking during the Reuters Global Environment Summit, Khosla said he hunts for “black swans” in alternative energy — revolutionary and unforeseen ideas that change the world as we know it — and are as unexpected as the birds they are named for.

“There is no such thing as great visionaries,” said Khosla, one of Silicon Valley’s best-known venture capitalists. “There’s a huge dose of luck… we just have to take more shots on goal.”

Khosla said Nassim Taleb, a Wall Street trader-turned-author uses the term “black swan” in a recent book to describe the unpredictable and consequential events in business that can be clearly explained once they happen — such as the current financial crisis.

But the world of technology creates opportunities for “good” black swans, added Khosla, who was dressed in his trademark all-black outfit.

Tom Peters recently talked about Black Swans and what to do when a negative one happens.

If you are interested in Khosla, check out these previous posts- Khosla’s Energy Portfolio, Khosla, the Pragmatist, Changing the rules.

Australian Clean Tech Index Performance Update

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John O’Brien provides some performance updates to the recently launched Australian Clean Tech Index.

In the report, there is a good explanation of how clean tech sector is different from the traditional Socially Responsible Investments SRI) or Environmental, Social and Governance (ESG) performance.

SRI and ESG look at incremental improvements in company performance and can be seen as ‘operational hygiene measures that find the best in class. Cleantech focuses on companies whose output positively enhances the communities and ecologies in which they reside. It is about doing more good rather than less bad . With over 70 companies falling under the coverage of the Index and with a combined market capitalisation of over $15Bn, the ACT Australian CleanTech Index presents for the first time a picture of the Australian cleantech industry s growth in a single measure.

Comparative Performance of the Index:

Percentage Change
FY06 FY07
 JUN’08
 YTD CY08
 FY08
ACT Australian Clean Tec Index
 93.3% 42.9% -1.8% -10.9% -16%
S&P/ASX 200
 17.2% 25.4% -8.3% -17.4% -16.4%
S&P ASX All Ord 19.6% 40.4% -12% -20.6% -23%

For a good explanation, sub-sectors, charts of performance and other information download the performance report provided by Australian Cleantech.

Amory Lovins on Energy Efficiency

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The McKinsey Quarterly has a good interview with the cofounder of the Rocky Mountain Institute.

The Quarterly: Given the economic benefits of saving energy, why haven’t companies already seized all the opportunities available to them?

Amory Lovins: Most chief executives assume that smart engineers are already doing everything they should to cut costs. CEOs don’t see all the market failures operating both in the C-suite and several levels down.

For example, most companies behave as if they’re capital constrained, so they defer or simply don’t approve these investments. Even without risk-adjusting your discount rates, saving energy is among the highest-return investments anywhere. But it tends not to get attention, because energy is only 1 or 2 percent of the cost of doing business, unless you’re doing something like smelting aluminum. It just doesn’t rise to the priority level most strategists care about.

And I’m astonished how often chief executives confuse the top and bottom lines. Years ago, I was talking to the head of a Fortune 50 company and was able to tell him about an engineer who had just cut $3.50 per square foot per year off the energy costs in one of the company’s plants. The CEO quickly and correctly translated that into $3.5 million in cost savings. But in the next breath, he said he couldn’t get excited about energy, because it was only 2 percent of his cost of doing business! He forgot where saved overhead goes—straight to the bottom line.

I had to do the arithmetic and show him that if he hypothetically achieved the same result in his 92 million square feet of facilities worldwide, his total net earnings would rise by more than 50 percent. That got his attention. He promoted the engineer, who spread his practices all over the company. Until then, that idea had never occurred to top management, because energy wasn’t an important factor cost.

The Quarterly: More broadly, how do you think CEOs should be approaching energy efficiency today?

Amory Lovins: Aggressively. They should think of energy and resource efficiency as a key source of competitive advantage. In my team’s latest redesigns for $30 billion worth of facilities in 29 sectors, we consistently found about 30 to 60 percent energy savings that could be captured through retrofits, which paid for themselves in two to three years. In new facilities, 40 to 90 percent savings could be gleaned—and with nearly always lower capital cost.

Moreover, seldom-counted side benefits can be far more valuable than the direct savings. For instance, a typical office pays about 160 times as much for people as for energy, so a 0.6 percent gain in labor productivity would have the same bottom-line effect as eliminating the energy bill. But we routinely see not a 0.6 but a 6 to 16 percent gain in labor productivity in efficient buildings with better thermal, visual, and acoustic comfort. When people can see what they’re doing, hear themselves think, breathe cleaner air, and feel more comfortable, they do more and better work. We also see 40 percent higher retail sales in well day-lit1 stores, 20-odd percent faster learning in well day-lit schools, and better clinical outcomes in green and efficient hospitals. These often overlooked side benefits are frequently worth tens or hundreds of times more than the actual reduction in energy costs.

For instance, a famous aerospace building designed for day lighting gave a far faster payback than expected, because it spurred 15 percent higher productivity and 15 percent less absenteeism. The higher productivity and reduced overhead of the green building gave the company a competitive advantage in a tough contract bid. Winning that contract generated enough profit to pay for the whole building. When the Wall Street Journal was writing its third article about the building, the Journal’s reporter called me and said, “They’ve clammed up. I can’t get any data. Can you find out what’s going on?” Well, the CEO had realized that the building was an important source of competitive advantage and that they’d already said way too much about it.

Lovins has this amazing capacity to connect technical ideas with the bottom line and that makes him a strong candidate to read for business people interested in this area.

When McKinsey starts interviewing Lovins we can see the interest in this area for the C-level executives.

We have covered Lovins before, here and here.