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The Opportunity: Green Business

Business, green business, sustainability, health and economic security have always been connected, but no more so than now after four years of neglect and ignorance by the Trump Administration. Mix in a raging pandemic, a new administration committed to tackling climate change, and it might just be that the path forward is in sight.

“There never has been a moment as opportune as this one to be talking about the intersection of business and sustainability,” writes Joel Makower, chairman and executive editor of GreenBiz Group, in the latest edition of the State of Green Business. The report is now in its 14th year.

“Justice,” he continues, is the new mantra governing a host of issues–social, racial, climate, economic, environmental and others. “During 2020, amid the economic, social, political and public health crises we encountered; corporate sustainability continued to move forward.” Because of Covid-19 and “the other challenges we’ve encountered, the idea of rapid, large-scale global action now seems more than a mere pipe dream,” says Makower.

Factoids from the report:

  • According to the U.S. SIF Foundation’s 2020 biennial “Report on US Sustainable and Impact Investing Trends,” sustainable investing assets now total $17.1 trillion, or 33 percent of the $51.4 trillion in total U.S. assets under professional money management — a 42 percent jump from 2018
  • As of October 2020, more than 1,500 organizations had expressed their support for the Taskforce on Climate related Financial Disclosures (TCFD), an increase of over 85 percent since June 2020
  • Given the above, it was not surprising to see an uptick in corporate ambition on sustainability issues. “Net zero” became a key commitment during 2020 — goals that aim to eliminate, at least on paper, a company’s greenhouse gas emissions, water extractions, fossil fuel use or deforestation activities by a given date
  • What will it take for companies to dramatically step up their ambition and actions? That is a defining question of the decade. No doubt the answer lies in a combination of investor pressure, technological innovation, consumption shifts, governmental pressure, new circular business models that reward resource efficiency — and more than a little grit and determination
  • Corporate sustainability efforts are continuing apace, even amid economic uncertainty and a global pandemic that, as of this writing, is far from contained. It wasn’t very many years ago that the future of corporate sustainability was uncertain even during good times

10 Subject-matter trends discussed in the 135-page report:

  1. Ocean-Based Sequestration Heats Up
  2. The ‘S’ in ESG Gains Currency
  3. Community Investments Pay Dividends
  4. Aquaculture Becomes a Net-Positive
  5. Industrial Decarbonization Picks Up Steam
  6. Nature Takes Root on the Balance Sheet
  7. Sustainable Mobility Drives the Newest Perk
  8. Aviation Plots a Sustainable Course
  9. The Circular Economy Shows its Human Side
  10. Corporate Advocacy Gets Louder

The “State of Green Business” is always a valuable resource, now more than ever.

Further reading:

“A New Day for the Climate,” New Yorker, by Elizabeth Kolbert January 31, 2021

It remains to be seen whether Joe Biden’s sweeping climate directives can make a meaningful difference, but a critical threshold has been crossed.

Beyond the brink

time bomb by Dirk Knight via Flickr CC

When it comes to the climate crisis we’re not on the brink of disaster, we’re beyond the brink.

A “Synthesis Report” report released Monday from the United Nations Intergovernmental Panel on Climate Change (IPCC), also known as the Sixth Assessment Report (AR6) says the world is likely to miss its climate target — limiting warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit) above preindustrial temperatures — within a decade.

Climate change has already caused “substantial damages, and increasingly irreversible losses, in terrestrial, 36 freshwater, cryospheric, and coastal and open ocean ecosystems.”  Losses of species have been driven by increases in the magnitude of heat extremes with “mass mortality” events recorded on land and in the ocean, the report continues. Impacts on some ecosystems are “approaching Irreversibility,” such as the impacts of hydrological changes resulting from the retreat of glaciers, or the changes n some mountain and Arctic ecosystems driven by permafrost thaw.

Climate change has reduced food security and affected water security, “hindering efforts to meet Sustainable Development Goals.”

All the widely documented impacts from human-caused climate change “continue to intensify,” the report says.

Humanity has reached a “critical moment in history,” IPCC Chair Hoesung Lee asserted: The world has all the knowledge, tools and financial resources needed to achieve its climate goals, but after decades of disregarding scientific warnings and delaying climate efforts, the window for action is rapidly closing.

At the current global pace of carbon emissions, the world will burn through its remaining “carbon budget” by 2030. Doing so would put the long-term goal of keeping global warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit) irrevocably out of reach. Keeping warming below th1.5 degrees Celsius threshold would help save the world’s coral reefs and preserve the Arctic’s protective sea ice layer. It could also stave off dramatic sea level rise by avoiding further destabilization in Antarctica and Greenland.

So we are all sitting on a powder keg, a loudly ticking time bomb, and while we may have the ability to defuse this bomb, can we do it?

State of Green Business: The Sustainability Cha-Cha

Following is an excerpt from GreenBiz Group’s 16th annual State of Green Business, which explores sustainable business trends to watch in 2023. Download the report here.

“Stay the course” is a brief summation from Joel Makower, chairman and co-founder of GreenBiz Group.

He writes: “That may be the key message coming out of the convulsing, confounding year that was 2022. For all that those 12 months threw at us — a still-raging pandemic, a global economic downturn, major supply-chain chokepoints, political upheavals, climate-exacerbated natural disasters, and a global energy crisis spurred by Russia’s unprovoked invasion of Ukraine — there’s no turning back for sustainability professionals.

“Of course, inflation and low economic growth led some companies to tap the brakes, slowing some initiatives, including the increased headcount that goes with companies’ growing sustainability ambitions. But not for long. There’s a general sense that the critical nature of social and environmental challenges, and the risks they pose to companies and society, will keep sustainability a hot-button business issue for the foreseeable future.

“It’s another round of the sustainability cha-cha: two steps forward, one step back.”

The risks are growing, he says, “but so are the rewards — to professionals, their organizations and, ultimately, to the planet and all who live here.” Since 2008, the GreenBiz editors and analysts have focused on 10 key trends worth watching, reflecting a broad spectrum of environmental and sustainability topics: transportation, carbon removal, the circular economy, climate tech, sustainable food systems, renewable energy and more.

Much of the sustainability wish list is coming to fruition, according to the report. “At last, biodiversity and natural capital are being recognized as critical inputs to business and industry; healthy ocean ecosystems are linked to climate mitigation and resilience; the financial sector, from insurance to banking to venture capital, is awakening to a post-oil future; and forthcoming transparency and disclosure frameworks promise to help separate leaders from laggards.”

Stakeholder capitalism “is alive and well, as companies and mainstream investors increasingly view environmental and social issues not as some social engineering conspiracy but as activities critical to business and macroeconomic success.”

For the 16th consecutive year, we’ve tapped the GreenBiz analyst and editorial teams to identify 10 key trends and developments GreenBiz will watch over the next 12 months. To learn more, download the free report here.

Sustaining Supply Chains

Supply chain infrastructure by Lars Plougmann via Flickr CC

Have supply chains ever really been sustainable? Are they more or less sustainable now in the post-pandemic, political and economic climate? Probably less.

Perhaps the problem is with the word itself: what happens when supplies are disrupted by war, weather, politics, economic turbulence and/or pandemics? Are the chains tough and flexible enough to withstand those punches?

Supply Chain Digest reviewed the Top Supply Chain Stories by Month 2022, which presented  pictures of oddities, failures, and “chaos.”

In January, for example, SCD reported that thieves are “opening intermodal containers as freight trains slow down or stop as they approach depots in downtown LA. That also leaves a trash mess around the rails from items the thieves don’t want.” Also, the queue of ships waiting to unload at the ports of Los Angeles and Long Beach reached a record high of 105, even as peak season ended weeks before.

And that was just January. In February Russia invaded Ukraine leading to chaos that is still happening.

In June, CSCMP and Kearney released the 2022 State of Logistics report. One of its metrics, US Business Logistics Costs (USBLC) rose sharply on an absolute basis in 2021 to $1.85 trillion. “That was an increase of 22.4% from an economically weak 2020. With a smaller increase in US nominal GDP (10%) than logistics cost rose last year (22.4%), that took the relative cost of logistics as a share of GDP to 8.0%, up significantly from 7.44% in 2020.”

Members of the International Longshore and Warehouse Union (ILWU), which represents West Coast dock workers, begin working without a contract in July after the current one expired at the end of June. Negotiations with the Pacific Maritime Association (PMA), which represents ports and terminals, began in May and a settlement seems well off.  Port automation is said to be a key issue, raising fears that a stalemate will lead to a dock worker strike and … supply chain chaos.

In December, the battery-powered Tesla Semi was launched as a commercially available product, with news that PepsiCo received the first vehicle. “It’s been a long haul for the electric truck,” according to SCD. “The company’s CEO Elon Musk first announced the cargo truck plans in 2017, with stated expectation for a commercial launch in 2019. At the announcement, Musk also said that on a November 25 test drive, a fully-loaded Tesla Semi (81,000 pounds) traveled 500 miles on a single charge.

Maybe we will all have to slow down in the EV age.

So what about this year? Thomas Insights offered these “top trends” in the supply chain for 2023:

  • An increase in Reshoring and Near-Sourcing initiatives: “Factors ranging from high freight costs, labor shortages, and factory shutdowns to component shortages, transportation delays, and geopolitical conflicts, have compelled many organizations to rethink their approach to supply chain management.” 
  • The Rise of crowdsourced delivery: A global research study found that around 90% of retailers expect to use crowdsourced delivery to handle specific orders by 2028. 
  • Better conditions for truckers: As of October 2022, the U.S. was short almost 78,000 truck drivers. “If current trends continue, the driver shortage could exceed 160,000 by 2031, contributing to significant supply chain delays.”
  • High supply chain costs: “In 2022, increases in fuel prices and ongoing global supply chain disruptions have severely impacted retailers’ margins. Between January and June, for example, the price of regular motor gasoline rose by 49% and the price of diesel fuel rose by 55%. Meanwhile, the ongoing war in Ukraine has seen a decline in food supplies and transportation bottlenecks. Because it’s more expensive, and takes a good deal longer, for retailers to acquire, transport, and store their goods, the prices of commodities are also soaring.”
  • Smaller warehouses: “Because smaller warehouses are both in-demand and hard to come by, recently, the rental rates for units less than 120,000 square feet had risen twice as much compared to bigger warehouses. Another option for retailers is to transform existing retail spaces into fulfillment centers. This is the tactic taken by Walmart, which is in the process of converting many of its 4,700 stores to mini-warehouses.”
  • Major skills gaps remain: “For supply chain leaders, a focus on attracting, recruiting, and retaining top talent will be a key focus in 2023, as will reskilling and upskilling the existing workforce.”
  • Technology investments: “The top supply chain technology trends of 2022 included digital twins, autonomous things, sustainability tools, and analytics everywhere. As companies become more comfortable utilizing these technologies, we will see them grow in 2023.”

Sustainable supply chains? It seems those are three words that don’t work very well together at the moment.

Copping out on COP

Climate Alliance photo via Flickr CC

Net zero? When it comes to net zero carbonization that sounds like a game that countries and companies play, much like getting to zero fuel emissions for some auto fleets, but not for others. It’s all about the math and playing with the numbers in a time-honored way to game the system and look good.

That really won’t cut it when it comes to the climate crisis because the corporations with the most to lose – and who are the most responsible for the crisis in the first place – don’t really want to hurt themselves too much while talking the net zero game.

From Triplepundit: “At COP27, companies, NGOs and governments are discussing what it takes to create a just transition, as in a climate action plan that is socially equitable.”

Hmm, that sounds like gobbledygook, or as Greta Thunberg might say (quoted in the Nov. 28 New Yorker article written by Elizabeth Kolbert: “blah blah blah…”

Can technological advances get us to net zero emissions? Maybe, but again, blah blah blah!

Here is part of Thunberg’s quote from the Youth4Climate conference in September:

“This is all we hear from our so-called leaders: words—words that sound great, but so far have led to no action. Of course, we need constructive dialogue, but they’ve now had thirty years of blah, blah, blah, and where has that led us?”

Governments and corporations need to develop and deploy climate technologies critical for the world’s net-zero agenda.

Now.

Beam it down! Solar farms in space!

London, United Kingdom by NASA via Flickr CC

Euronews is reporting that giant solar farms orbiting the planet may someday power Europe. The European Space Agency (ESA) unveiled a plan to harvest the sun’s energy in space and beam it back down to Earth.

It’s an idea that has been around for a while, and the subject of science fiction stories, but now it is closer to science fact. The technology is still in the preliminary testing phase, but the goal is the construction of a 2-kilometer (1.2 mile) long solar space farm, generating as much energy as a nuclear power plant, according to Hannah Brown with the European Broadcasting Union (EBU). The farm would orbit about 36,000 kilometers above the Earth.

“[Such a project] would ensure that Europe becomes a key player– and potentially leader – in the international race towards scalable clean energy solutions for mitigating climate change,” the ESA said in a statement.

Solar power is a great source of clean energy, but it’s held back by some limitations. For example, solar panels can only harness power in the daytime, and even then, much of the sunlight is absorbed by the atmosphere on its journey to the ground. But in space, the sun’s beams are around ten times as intense as they are on Earth.

The ESA has partnered with Airbus to develop ‘wireless power transmission’ to capture this 24-hour source of electricity and beam it down to us. The technology is based on the transmission used by TV and communication satellites every day, Airbus engineer Nicolas Schneider explained: “We are not very far from a 4G antenna, except that what we want is not to radiate in all directions, we want to be very precise like a laser, in fact. It’s a wave that can be directed to this receiving antenna which will then transform this wave into electricity.”

The problem is one of scale. The satellite would be massive, and so difficult to launch and build. But doable.

With mega-billionaires so interested in playing around in space, maybe they should spend a few billion for this and become energy czars.

Let’s do this!

Dueling for compliant fuel

Bunkering by Cycling Man via Flickr

Container shipping operators are scrambling to come into compliance with United Nations decarbonization rules, according to IHS Markit.

In 1973, the International Convention for the Prevention of Pollution from Ships (MARPOL) expanded the powers of the International Maritime Organization (IMO) to regulate the environmental impacts of shipping. A MARPOL update in 2008 called for a reduction of the maximum sulfur content in marine bunker fuel from 3.50% to 0.50% in 2020, unless a supply study would conclude insufficient availability of compliance fuels and a delay to 2025 deemed necessary. But, in October 2016, the IMO came to a broad agreement to implement the global reduction in the sulfur content of marine bunker fuel from January 1, 2020.

IHS Markit estimates that about 55,000 ships of a total fleet of about 110,000 vessels burn heavy fuel oil bunkers and that roughly 30,000 ships account for about 80% of global fuel oil bunker use.

Compliant fuel means seven and eight-tenths (7.8) pounds per square inch (psi) low Reid Vapor Pressure (RVP) gasoline, federal reformulated gasoline, or ethanol-blended low RVP gasoline as described in section 5 of the IMO rule.

Operators must therefore compete to secure shore-side production of eco fuels such as hydrogen, ammonia, and methanol with other energy-hungry industries. The current global supply of hydrogen, ammonia and methanol would barely cover the needs of the shipping industry, even without competition from other critical sectors such as manufacturing, oil refining, and the production of fertilizers, said the Shipping Gazette.

The shipping industry uses more than 300 million tons of fossil fuels every year, about five percent of global oil production, and there is still no clear pathway toward replacing that volume with renewable fuels.

The Paris-based International Energy Agency (IEA), predicts ammonia will be the dominant alternative fuel for shipping by 2050.

Jonah Sweeney, a European marine fuels analyst at oil price reporting agency Argus, told the IMO that alternative fuels such as ammonia and methanol produced less energy than very low sulfur fuel oil (VLSFO). One ton of VLSFO produces 2.2 times more heat content than one ton of ammonia and 2.1 times more than methanol.

“It is important when looking at alternative fuel options to compare like for like in terms of energy output, otherwise if you take the outright price of methanol, for example, you will have a substantial discount to VLSFO, but you will need about twice as much,” Sweeney said, quoted in the Shipping Gazette.

This is a big problem, because about 93 percent of the global companies that have set net-zero goals are on course to fall short of their carbon emissions targets, according to Triplepundit.

Green Corridors on the deep blue sea

On the shipping lane by Kari Nousianien via Flickr CC

The ports of Gothenburg and Rotterdam pledged to establish a Green Corridor between the two cities, which will put a framework in place for collaboration on alternative fuels and reducing carbon emissions.

The Memorandum of Understanding (MoU) was signed in the presence of the Swedish and Dutch royal families. It is intended that the corridor will become part of the European Green Corridors Network, set up in March 2022 by the Maersk McKinney Moller Centre for Zero-Carbon Shipping.

According to a recent report from McKinsey, zero-emission fuels and vessels will need to be deployed over the next decade to achieve full decarbonization of the shipping sector by 2050. “This ambitious goal could be catalyzed by green corridors.”

The zero-emission goal was established by the International Maritime Organization (IMO), which has mandated emission reductions of 50 percent for all vessels by 2050. (Annex 11 Resolution MEPC.304(72) adopted April 13, 2018, Initial IMO strategy on reduction of GHG emissions from ships, International Maritime Organization, imo.org.) A number of countries—including Japan, the United Kingdom, and the United States—have declared a target for net-zero shipping emissions in the same time frame.

The U.S. Department of State released a “Green Shipping Corridors Framework” fact sheet in April that states: “Green shipping corridors can spur early and rapid adoption of fuels and technologies that, on a lifecycle basis, deliver low- and zero-emissions across the maritime sector, placing the sector on a pathway to full decarbonization. The United States envisions green shipping corridors as maritime routes that showcase low- and zero-emission lifecycle fuels and technologies with the ambition to achieve zero greenhouse gas emissions across all aspects of the corridor in support of sector-wide decarbonization no later than 2050. There are multiple pathways through which a fully decarbonized corridor can be achieved; this green shipping corridors framework therefore provides maritime stakeholders the flexibility to choose the path that best suits their needs.”

It seems that we are in the early stages of actually establishing green corridors in the maritime/port sector, which is why the Rotterdam-Gothenburg agreement is significant. Allard Castelein, Chief Executive of the Port of Rotterdam said: “This Green Corridor initiative is part of our ongoing efforts to bring together parties across the supply chain to help realize more sustainable shipping in support of the Paris Agreement.” And Elvir Dzanic, Chief Executive of the Gothenburg Port Authority added: “We can now present a more distinct path towards the decarbonization of shipping.”

The McKinsey report asserted: “Finding industry-wide solutions is challenging, given the varied and complex nature of the sector. One way to accelerate decarbonization is to implement ‘green corridors’: specific trade routes between major port hubs where zero-emission solutions are supported. A new report, The next wave: Green corridors, produced by the Getting to Zero Coalition in collaboration with the Global Maritime Forum, Mission Possible Partnership, and Energy Transitions Commission, with analytical support from McKinsey, probes the feasibility of two such selected corridors,” the Australia-Japan iron-ore route and the Asia-Europe container route.

The results of this analysis are “encouraging” but there is still a long navigation ahead.

Port Offers Solar Power Project Funding

RMS Queen Mary/Long Beach, CA by Jason Mrchina via Flikr CC

The Port of Long Beach is accepting “concept paper” proposals for solar power generation projects that qualify for funding under the port’s Community Grants Program.

The Community Grants Program encompasses more than $46 million to fund projects that help those in the community who are most vulnerable to port-related impacts and to reduce greenhouse gases. These projects include expanding asthma services, controlling stormwater runoff through the building of permeable parking lots, and creating open space buffers between port operations and communities, to name a few. Combined with a previous program started in 2009, the Port of Long Beach has set aside more than $65 million, making it the largest voluntary port mitigation initiative in the country. To date, $36.5 million has been committed.

Projects that receive grants will serve people most sensitive to port impacts, including seniors, pregnant women, children, and those with asthma or chronic illnesses. Public and private agencies are eligible to apply, however, home improvements are not eligible. To view the program’s relevant Facilities Improvements guidelines and the pre-solicitation workshop, go to www.polb.com/grantopportunities.

Applicants are required to describe proposed projects at a high leve, the port says,l and program staff will determine project and applicant eligibility. Concept papers must be submitted online and are due by 4 p.m. Wednesday, Nov. 23.

The Port of Long Beach is a gateway for the trans-Pacific trade. With 175 shipping lines connecting Long Beach to 217 seaports, the Long Beach handles $200 billion in trade annually, supporting more than 575,000 Southern California jobs.

The grant program contact is Jennifer Williams, Environmental Specialist Associate, at (562) 283-7133, grants@polb.com

Preserve biodiversity through sustainable forest management

deforested by naqi via Flickr CC

Deforestation is the greatest threat to valuable biodiversity, with around 10 million hectares lost to deforestation each year, mainly for agricultural expansion, according to a new report from the Food and Agriculture Organization of the United Nations (FAO).

The key to thwarting deforestation is sustainable forest management, the report says. “Protecting the animals, plants, fungi, and microorganisms that thrive in forests must become a fundamental goal of sustainable forest management worldwide.”

The world’s forests provide habitats for about 80 percent of amphibian species, 75 percent of bird species and 68 percent of mammal species. In addition, about 60 percent of all vascular plants occur in tropical forests. The importance of sustainable forest management has long been recognized, but more action in a concerted manner is needed.

“The conservation of the world’s biodiversity is utterly dependent on the way in which we interact with and use the world’s forests,” said Tiina Vähänen, Deputy Director of FAO’s Forestry Division, of the report, Mainstreaming Biodiversity in Forestry.  The report was released at the 8th World Forest Week on the sidelines of the 26th Session of FAO’s Committee on Forestry.

The report assesses tools and methods of ensuring the conservation and sustainable use of biodiversity is integrated into forest policy, strategy and management. Through a series of case studies from the Democratic Republic of the Congo, Ethiopia, Finland, Japan, Malaysia, Mexico, Peru, and the United Kingdom it explores lessons learned and identifies good practices.

It recommends actions that governments and development partners can take “to facilitate the mainstreaming of biodiversity in forest management”:

  • Halting and reversing deforestation
  • Combating illegal and unregulated forest activities
  • Recognizing the forest tenure of Indigenous Peoples and local communities
  • Preventing the conversion of natural forests into monospecific forest plantations
  • Ensuring the sustainable management of harvested species
  • Managing and controlling invasive and overabundant species
  • Leveraging global momentum on restoration to enhance biodiversity conservation
  • Adopting a multisectoral perspective
  • Providing economic incentives
  • Facilitating market-based instruments
  • Investing in knowledge and capacity development

“We hope that the wealth of information and recommendations made in this study will inspire action from those involved in forest management and conservation,” said FAO Forestry Officer Kenichi Shono.

The role of forests in maintaining biodiversity is explicitly recognized by the United Nations Strategic Plan for Forests 2017–2030 and in 2019, FAO adopted the Strategy on Mainstreaming Biodiversity across Agricultural Sectors.

Lots of hope, lots of studies: time for action.

All-electric cargo plane flies for DHL

The first fully electric commuter/cargo plane ‘Alice’ by Eviation Aircraft successfully completed its maiden flight at Moses Lake, Washington, USA. Credit: DHL

Alice in Cloudland? DHL successfully launched the first all-electric cargo plane, Alice, late last month.

The maiden flight was completed at Moses Lake, WA’s Grant County International Airport (MWH), It flew for eight minutes and reached an altitude of 3,500 feet. The Seattle-based manufacturer, Eviation, is the builder.

“Completing its maiden flight confirms our belief that the era of sustainable aviation is here. With our order of 12 Alice e-cargo planes, we are investing towards our overall goal of net-zero emissions logistics,” said John Pearson, CEO DHL Express, who was quoted in the article.

https://www.dpdhl.com/en/media-relations/media-center/tv-footage/first-ever-fully-electric-plane-alice.html

A single pilot can fly the plane and it will carry 1,200 kilograms (2,600 lbs.). It will require 30 minutes or less to charge per flight hour and have a maximum range of up to 815 kilometers (440 nautical miles).

DHL says Alice will operate in all environments currently serviced by piston and turbine aircraft. Alice’s advanced electric motors have fewer moving parts to increase reliability and reduce maintenance costs. Its operating software constantly monitors flight performance to ensure optimal efficiency.

The aircraft is ideal for feeder routes and requires less investment in station infrastructure, DHL says. The Alice can be charged while loading and unloading operations occur, ensuring quick turnaround times that maintain DHL Express’ tight schedules. Eviation says Alice  can be configured for cargo or passenger use.

Pearson noted that Alice’s range and capacity “makes it a unique sustainable solution for our global aviation network.” It supports DHL’s goal to make a “substantial contribution” in reducing its carbon footprint and ultimately, achieving net-zero emissions by 2050.