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The Week in Green
Who is in charge of the UK's environmental policy? Prime Minister Gordon Brown, environment secretary Hilary Benn perhaps, or is it Daily Mail editor Paul Dacre?
Based on the evidence of this week, my money's on Dacre. No sooner does the Dark Prince of Fleet Street launch a campaign to crack down on plastic bag waste than the prime minister finally signals he is willing to get tough on the supermarkets and introduce legislation to cut the number of plastic bags in circulation if voluntary targets are not met.
It seems that all those green businesses and environmental groups lobbying Whitehall have wasted their money; they'd have been better off wining and dining the Mail's editorial team.
It is a relatively minor incident but it emphasises the absurd level of caution that characterises the government's green policies. For years, ministers have wanted to do something about plastic bags and levels of supermarket waste but have been too scared to take any action. Now, the Daily Mail says it is OK and it immediately starts to get tough with retailers who for too long only played lip service to addressing the issue. Instead of taking a bold and popular move off his own back, Brown now looks as if he has been bounced into cracking down on plastic bags by the Mail.
Countless other good green policy ideas are being similarly ignored for want of a bit of bravery and imagination in Whitehall.
For example, as the Green Alliance's new report suggests, scaling back VAT in favour of a hefty levy on environmentally damaging products would be both popular and effective move that has been repeatedly mooted but has failed secure government support.
Meanwhile, it has been left to the Tories to develop an innovative mean of bolstering cleantech investment without recourse to taxpayers money in the form of its Green ISAs proposals.
At the same time, as our investigation this week revealed, Defra is scaling back successful green business support services because of a budget shortfall the Treasury could resolve with ease if it only saw the environment as a genuine priority.
Similarly, all the government's talk of a renewable energy revolution has to be seen in the light of another record year for wind farm planning application rejections.
All of this is not yet quite disastrous given the sheer scale of the cleantech investment coming out of the private sector and the increasing willingness of firms to embrace and develop innovative green technologies and business models.
And yet you can't help but think how much simpler everything would be if the government took the bold steps required to give these technologies and business models the helping hand they need to reach the mainstream.
Right, I'm off to try and find me some green wine.
Have a good weekend.
Cheers,
James
With the Daily Mail on our side, anything's possible…
You've got to love the Daily Mail.
Not the content, obviously, which is an appalling mix of crass hypocrisy, barely concealed xenophobia, self satisfied voyeurism masquerading as morality, and journalistic standards that long since passed through the both the gutter and the sewer and are now fast approaching bedrock.
No, what you've got to love about the Daily Mail is its chutzpah.
So, when it decides to run a huge splash on its front page about its new Banish the Bag campaign, it does not stop for a second to savour the irony evident in the fact that for years it was one of the strongest bastions of anti-environmental thinking in the mainstream media.
Nor does it display the slightest hesitation before claiming that the Marks & Spencers' decision to charge customers for plastic bags, which has been in the pipeline for months and was extensively trialled before the Mail had even begun to consider giving itself a green makeover, represents "a major breakthrough for the Daily Mail campaign".
Of course, you can say what you like about the Mail – and I often do – but the other thing you have to love about the paper is its unfalteringly accurate understanding of what its readers want.
The Mail is all about shifting units and has a long and ignoble history of changing its editorial line and erasing its previous positions as soon as it recognises it needs to adapt to its customers' changing world view.
In this light, the fact that it has decided that an attempt to Banish the Bag will resonate with readers says more about the increasingly green priorities of Middle England than any number of consumer attitude surveys.
If Daily Mail readers really are concerned about plastic bags and are even willing to forego a degree of convenience to tackle the problem then attitudes really are changing.
What's more, businesses will need to take note of this shift, because just as M&S will love the front page praise it has received today, no business will want to be singled out for criticism and accused of not responding to Mail readers' wishes.
Why it's time to stop talking to the climate sceptics
It is fair to say that talk radio is never going to be the forum for the most nuanced debate on green issues, but after appearing on London's LBC 97.3 last Sunday to discuss the business case for environmental action I was still taken aback at the refusal of many to even accept the possibility that climate change is real and that perhaps we should do something about it.
Every conspiracy theory going was voiced during an hour that saw me fielding questions from the host James Max and members of the public, all of which pretty much boiled down to "there's no such thing as global warming, is there?".
There was the suggestion that scientists have made it all up to protect their "lucrative" funding, that green taxes are just a ruse to make more money, that sunspots are responsible for global warming and that only a few decades ago we were worried about global cooling.
There was also my personal favourite from a woman called Joan who rung in to say there was nothing to worry about because as it gets warmer she'll be able to grow oranges and lemons in her garden.
The problem is how you even begin to engage with these views when the person you are talking to will countenance neither scientific evidence nor logical reasoning.
Consequently, my suggestion that the scientific funding available to research manmade climate change is dwarfed by the financial gains available to those who can prove the opposite were pretty much ignored.
As was the fact that the proportion of tax revenue coming from green taxes has fallen in the UK over the last decade and the fact that sunspots and the post war period of cooling have both been fully accounted by the vast majority of climate scientists who are certain we now face a global catastrophe of unprecedented scale.
As for Joan, the fact that a couple of degree increase in average temperatures would mean drought and catastrophe in other parts of the world was rejected on the grounds that "lots of part of the world are cold". While the argument that the flip side of orange groves in our gardens would be more frequent water shortages and fatal heat waves was dismissed with the rather glorious non sequitur "we had heat waves when I was girl".
So what do you do when the normal rules of debate are temporarily revoked by individuals who refuse to recognise concepts such as evidence and logic? How do you argue with an assertion that climate change is not happening based on nothing more than a belief that it is not happening? And what should businesses do with customers and employees who continue to cling to these views?
I'm increasingly coming round to the view that the answer is to just ignore them.
As I quickly realised last night you are never going to change their mind, on the simple basis that belief will trump evidence every single time. Attempting to engage in a debate is a pointless exercise that will only leave those armed with genuine peer-reviewed scientific evidence or basic principles of risk mitigation feeling extremely frustrated.
Instead the best option when faced with the belief that manmade climate change is not happening is to steal a move from the sceptics play book and reframe the debate.
The fact is that most of the changes required to deliver a low carbon economy make sense with or without climate change.
For example, Joan might not care about the environment, but she is likely to care about her energy bills and would welcome ways to cut them. For businesses this cost argument is even harder to dismiss given soaring energy prices and growing concerns over supply security.
Even GM's Bob Lutz has grown to accept the logic of this argument, dismissing climate change as a "crock of shit" but insisting GM's Volt electric vehicle is still needed to help wean the US off of increasingly expensive foreign oil.
Meanwhile, business leaders who are sceptical about climate change still have to accept and address the commercial, cost and legislative risks associated with being a carbon intensive business even if they think the customers and politicians imposing these new green demands and laws are just plain wrong.
Because more people understand good basic business sense than understand climate science, sceptics will find these arguments in favour of action far harder to dismiss than they do UN climate reports.
And if you can convince enough of them to start to reduce their energy use through these basic business arguments it may be possible to encourage even the most sceptical firms and customers to make progress towards cutting their carbon footprint even while we wait impatiently for the last of the climate change denying dinosaurs to finally die out.
The Week in Green
One of the most intractable problems we all face as we transition towards a low carbon economy is the issue of transport.
The problem is that but for those rather inconvenient carbon emissions energy intensive fossil fuels are pretty close to perfect for countless different forms of transport.
It is the sheer scale of this challenge - finding a solution better than engines so effective their design has seen only negligible changes in the past 50 years - that perhaps explains why attempts to develop zero carbon transport have been so fragmented with countless firms backing countless ideas.
The net result is that mainstream adoption of zero carbon planes, trains and automobiles remains decades away, but that doesn't mean that encouraging progress is not being made.
This week alone has seen a raft of developments with Airbus undertaking the first test flight of a commercial airliner using a fuel cell to power some of its electronic systems, plans to deliver an air powered car by 2010, new funding for research projects into a second generation biofuel capable of delivering a fuel similar to crude oil from waste organic matter, and, perhaps most intriguingly, reports of plans for the world's first solar powered round-the-world-flight.
Of course not everyone is on board with the push for lower carbon transport. Porsche this week decided their standing amongst environmentalists was already so poor it might as well go the whole hog and threaten to sue Mayor Ken over his congestion charge plans.
But then again when even those like Bob Lutz of GM who think climate change is a "crock of shit" can see the economic and geopolitical case for lower carbon transport there is still substantial grounds to believe the technical problems will be overcome.
In fact, Lutz's view almost makes you wish the government would start expressing scepticism over climate change as long as it combined it with just a modicum of understanding of the risks associated with energy security and peak oil.
Instead it continues on its oh so confused way – toughening up the climate change bill, cracking down on rogue offset providers and finally hinting that it might adopt a sensible means to promote onsite renewables, whilst administering swinging budget cuts across the department primarily responsible for managing the transition to a low carbon economy.
Right I'm off to see if anyone can join this carbon offsetter trade group while preparing for my media commentator debut on James Max's Sunday evening Business Matters show on LBC 97.3FM.
Have a good weekend.
Cheers,
James
The Week in Green
How do you plan for the law of unintended consequences?
By definition, it is impossible to do so. And yet businesses and legislators developing environmental initiatives have little choice but to try, or else risk their best intentions back firing badly and in some cases doing more harm to the environment than good.
The law of unintended consequences was given a good airing this week as observers tried to work out the likely repercussions of London Mayor Ken Livingstone's decision to give the green light to a tiered congestion charge that charges gas guzzlers £25 a day while exempting Band A and B vehicles from any charge.
According to some critics the plan is likely to have little or no impact on emissions and congestion and could well cripple the embryonic market for electric cars. By extending the exemption from the congestion charge currently enjoyed by electric cars and alternative fuel vehicles to all cars emitting less than 120g of CO2 per km, including several diesel cars, the financial case in favour of electric cars in the capital has been seriously diminished.
Moreover, there is a risk that those driving SUVs and the like will just fork out the £25 a day and keep driving, while more people will be tempted to drive smaller cars into the capital, leading to increased congestion and air pollution. It's not what the Mayor intended, but there is a real chance it could happen.
With so many green laws, technologies and business models still barely out of kindergarten the risk of unintended consequences are often sizable. From biofuels to the first phase of the EU's cap-and-trade scheme there are countless examples where what seemed like a green idea at the time have either failed to deliver or even had some potentially unpleasant side effects.
This week alone we've had warnings that tighter rules governing green advertising could inadvertently stifle firms' attempts to develop environmentally friendly business models, fears that investing in ethical funds could bolster big oil, and the bizarre sight of the government making such a mess of its grant scheme for onsite renewables that an increase in the overall amount of cash available has led to a slump in the number of people applying for grants.
The one good thing about the law of unintended consequences is that unless you have the memory of a goldfish it should only happen the once – after that it is an intended consequence and failure to put it right means you are either an idiot or just don't care.
As the green business movement matures more and more people will get their head round the counter intuitive thinking that is often required to develop a green business model or product. In time haulage firms will realise that you can sometimes save money, cut emissions and even travel faster by driving slower; cap-and-trade schemes, such as that proposed in the US, will learn from the EU's early mistakes and develop a far more robust system from the start; and emerging green sectors such as offsetting will realise they are stronger working together than competing.
Right, I'm off to lobby my boss to give me the 29th of February off so I can picket outside restaurants serving bottled water.
Have a good weekend.
Cheers,
James
When only the top dog will do
One of the more intriguing aspects of investigating green companies is trying to work out the extent to which they are different to conventional firms.
There are two schools of thought.
The first argues that green firms represent a completely different way of doing business, requiring different priorities, different skill sets, different management techniques, different managers and even a different understanding of what a business is and does.
The alternative view, and the one I generally ascribe to, is that green businesses are not really different to conventional firms at all. They follow the same business principles that have always existed, it is just they are the ones adapting fastest to the changing social, political and economic landscape around them. So old-fashioned business rules governing risk mitigation and cost control explain the focus on cutting energy use, while entrepreneurial nous and the ability to spot a gap in the market explains investment in developing new green products.
However, while the business principles that define green and conventional firms are much the same there are still differences to be detected in their operational approaches, and perhaps the most important of these is found in their differing sales strategy.
I recently met with Simon Francis, vice president for energy solutions at PC management software outfit 1E, who was convincing in his argument that firms selling green products to business customers needed to develop a whole new sales approach if they are to find a receptive audience.
"If you've got any sort of green message you need to get higher up the management chain than your traditional market," he argued. "Green products of any type need to be pitched at the highest level possible."
It is a lesson Francis claims 1E has learnt with its automated PC turn off system Nightwatchman, which it now frequently pitches at CEOs and CSR officers rather than its traditional target customers in the IT department.
It's not that IT managers aren't interested in the technology and the energy savings it promises, he claims, it's just that their priorities are more likely to lie elsewhere or they are reluctant to assign their budget to a product that tends to deliver the bulk of its cost savings to the facilities department.
In contrast, the CEO cares about the overall budget and increasingly cares about the environmental implications of energy saving measures, making him or her a far more receptive target for the sales pitch.
It is a model that can be applied to any number of green products and services: a green car company is better off targeting a CEO than the fleet director who will have to deal with any staff disgruntled at getting a less powerful company car; a salesman for energy efficient air conditioning systems will probably find the COO provides a more receptive audience than a cash-strapped facilities manager balking at the prospect of a sizable upgrade project; while a green energy firm is better off talking to the managing director about risk mitigation and marketing opportunities than a finance director or energy manager who can't see beyond the raw cost implications.
The simple fact is that green products tend to deliver benefits that stretch far beyond the departments that procure them and as such sales staff need to get beyond the operational managers who, through no fault of their own, tend to have more immediate concerns on their mind.
Of course, getting access to those in the upper echelons of the corporate hierarchy will test any sales team's mettle. But then again, when it comes to green products the more senior the exec you pitch to the higher the chances of success.
The Week in Green
Can a green company justify investing in a decidedly non-green firm?
The instinctive answer is no, but then what if the green firm uses its influence over the purse strings to force the environmental laggard to clean up its act. That's got to be good, right?
It is a hugely complex issue and one those in the green investment community are struggling to agree on.
This week Standard Life Investments through the debate into sharp focus by announcing its ethical funds had divested all their stock in airlines and would no longer invest in the sector.
Only 30 per cent of its investors had advocated such a move, but the investment firm insisted this was a significant enough proportion to prompt the bold step. Cue much wailing and gnashing of teeth from the airline industry which argued that a) it was being unfairly victimised, and b) the best way for investors concerned about the environment to influence airlines was to invest and make their concerns known.
Of course, Standard Life's move is towards the extreme end of the spectrum, but plenty of mainstream investors are similarly edging away from the most carbon intensive firms.
Citi, JP Morgan Chase and Morgan Stanley, for example, all signed up to a new set of investment criteria this week that commit them to taking carbon concerns into account when investing in the energy sector. The so-called Carbon Principles leave the banks more than enough wriggle room to justify investments in fossil fuel based projects, but they also mean they will increasingly favour the more environmentally friendly operators.
Meanwhile, those firms daft enough not to respond to the Carbon Disclosure Project's request this week for information on their carbon emissions will hardly be doing their relations with investors any favours.
It is this pressure from the money men, coupled with the emergence of carbon reporting legislation such as that being proposed in Australia, that is forcing more and more firms to keep track of their carbon emissions.
Thankfully, there are plenty of firms springing up to help provide this service, ranging from companies offering to calculate emissions associated with your marketing efforts to those developing ways to keep track of your IT emissions.
Ultimately it is this day-to-day requirement to account for carbon and appease investors that will do far more to drive carbon emission reductions in the medium term than any dubious biofuels or decades-long research projects into hypersonic jets that might not be that green after all.
Right, I'm off to hot wire a Honda Civic Hybrid and use it to hunt down a polar bear while trying to work out how to save Defra a billion quid.
Have a good weekend,
James
If we can't use polar bears, what can we use?
So polar bears are passé, apparently. Snow scenes are soporific and interest in ice floes is melting as fast as the ice floes themselves.
That is the view of picture agency Getty Images, which this week unveiled a major new report suggesting that the conventional images used in firms' green marketing campaigns are fast becoming "visual clichés" that are resonating less and less with customers.
You have to agree it has a point.
The visual language used to communicate green marketing campaigns in general and climate change initiatives in particular have become staid and repetitive to the point of boredom. To the list of images that should be removed forthwith from the corporate marketing armoury I'd like to add melting glaciers, belching smokestacks and generic tropical rainforests. Any power these images once had has diminished in direct proportion to their ubquitous familiarity.
In many ways it is surprising they have retained an impact for as long as they have. Few people have seen a polar bear, even fewer have seen an ice flow, and as such marrying the climate change message with such exotic imagery was always a high risk strategy that would ultimately alienate much of the audience.
But if it is time to put the polar bear's out to pasture, or wherever it is aged polar bears go, then what should advertisers replace them with?
It is a tricky question and one advertisers and marketers need to answer quickly if they are to avoid further alienating an audience that is already showing some signs of green fatigue.
The answer lies in reconnecting the issue back to the customer. One of the reasons that action on climate change is still so limited is that it is too big and broad a topic for most people to get their head round, a sense only amplified by the use of alien and exotic imagery. If firms want to promote their climate change strategies they have to show what such strategies, or their absence, means for the customer.
In this context floods, famine, droughts and changes to local wildlife are all more powerful warning symbols than the polar bear. Better still, images of green jobs and green technologies provide a far more positive visual backdrop for any corporate climate change strategy.
Moreover, if climate change is too big and scary a topic for customers to comprehend then firms need to find a way to promote their environmental credentials that ties them in with other issues.
This week's survey of Co-op members found that customers are prioritising ethical trading, animal welfare and smaller scale environmental concerns such as packaging over climate change. What is interesting about the findings is that while consumers bury their heads in the sand over climate change sizeable numbers are concerned over issues that relate to global warming.
As Co-op chief executive Peter Marks pointed out fair trade and climate change are inexorably linked when you consider that climate change will disproportionately impact developing economies. Make this connection and carbon reductions become part of a company’s ethical positioning.
Equally, animal welfare can be protected as much through attempts to protect habitats as through ethical farming policies, while reducing packaging cuts carbon emissions as well as waste.
There are plenty of images out there to replace the poor old polar bear and revitalise green marketing messages. It just requires a bit of imagination and a desire to educate the customer about the real, local impacts of both climate change and greener business models.
The Bad, the Good and the Ugly of the government's green policy
Some days it is hard to think of topics harder to fathom than the logic behind the government's increasingly confused environmental policy. The theory of relativity in Esperanto perhaps, or maybe a three hour lecture on James Joyce's use of the semicolon.
Yesterday was one of those days.
It started with the Treasury Select Committee expressing its disappointment at the government's "timid" approach to green taxes and failure to deliver a joined up approach to climate change.
Much has already been written about the fact that this government has overseen a decrease in the proportion of revenue coming from green taxes at a time when the exact opposite was required. But it is worth noting again that a supposed centre left government has completely turned its back on a progressive means of taxation (low income groups emit less carbon) that provides the simplest means of correcting the market failures that have allowed individuals and businesses to pollute without consequence.
It is hard to overstate the extent to which the fuel protests of 2000 screwed up this government's thinking on the environment and it is a damning indictment of its meekness that eight years on there are still few signs it is willing to take tough decisions on green taxation. And this despite the growing number of businesses who accept they have a role to play.
A quick call to the Treasury prompted a government statement that is now so well worn most green business execs could write it themselves.
We have introduced green taxes such as the climate change and aggregates levy, said the Treasury, adding that these taxes had helped ensure the UK will emerge as one of the few countries that will meet its Kyoto targets. Well, yes they had, but almost certainly not as much as the shift in the UK's energy mix from coal to gas that countless independent observers have identified as the primary cause of the UK's relatively impressive emissions performance.
Moreover, referencing a couple of new green taxes does nothing to counter Committee chairman John McFall's conclusion that these taxes are "minuscule in the grand scheme of things".
Of course, there was some optimism to be gained in the Treasury Committee's report. Most noticeably in the fact that a cross party committee of MPs is reaching these (admittedly blindingly obviously) conclusions. The call for the appointment of a climate change minister is also a welcome idea that many green business execs would support. Although it is worth noting that the only way a dedicated climate change minister would help deliver the cross-departmental joined-up thinking that is so desperately required is if the new minister is given real authority pretty much on a par with the four great offices of state.
A junior minister knocking meekly on the door of the Treasury or Home Office asking for more action on climate change would be at best an outrider for the environment minister and at worst a glorified fig leaf for the government's decidedly ropey environmental record.
The day then took a more optimistic turn when I met with Adam Bruce, UK CEO of Airtricity and chair of the BWEA, to record BusinessGreen's EcoEntrepreneur Podcast, which should be up online next week.
Adam had just hot-footed it over from Downing Street, where he been meeting one of the prime ministers top energy advisors, and was set to spend the afternoon back in Whitehall meeting officials at the Department of Business, Enterprise and Regulatory Reform (BERR). Rather than despairing at the prospect of a day in the company of mandarins who have in the past been less than supportive of the renewables sector he was surprisingly upbeat.
According to Bruce there has been a detectable shift in the government's attitude to climate change in the last six months and there is finally a genuine appetite to get things done. This is particularly apparent at BERR, where Bruce reckons the word has come down from the "impressive" and "lucid" minister John Hutton that targets must be hit and the renewables industry supported. If true it is a remarkable turn around for a department that only a few short months ago was reportedly investigating ways to wriggle out of the UK's renewable energy targets.
Bruce's confidence is also good news for all other businesses with a green agenda, because if Ministers are finally leaning on civil servants to treat the EU's carbon targets as priorities then it is inevitable that the support, incentives and regulations required to assist firms' carbon cutting initiatives will materialise.
Or so I thought for the five minutes before I returned to my desk to find that Defra is apparently in the throes of crisis meetings to identify £1bn of budget cuts for the next three years.
Defra is insistent no decisions have yet been made, but the scale of the cuts are little short of a "disaster" and it is inevitable business support functions will be impacted.
What we do know is that 31 people have already been made redundant by WRAP, the main agency for promoting recycling, and the organisation is developing a new plan to refocus its priorities, which is PR speak for ditch some of its activities.
Defra appears to be trying to protect its climate change activities from the axe, mindful of how any big cuts would undermine the government's rhetoric. In fact, flood defences have been earmarked more money. But this only means conservation agencies and waste management activities are firmly in the firing line. Meanwhile, sources are convinced a number of smaller funds designed to support many non-government organisations, including plenty that provide business advisory services, are facing the chop.
It is a genuine travesty and regardless of how the government tries to spin it there is no way a budget shortfall of £300m a year will not jeopardise the UK's climate change efforts.
Moreover, it is just the latest in a series of incidents that characterises a government appears increasingly torn between taking the measures needed to drive the low carbon economy and sticking with the budget allocations, tax policies, and ministerial structures that will make such a transition nigh on impossible.
On days like yesterday it is hard to get away from the impression that the government's climate change policy really is a back of an envelope stream of consciousness job of which James Joyce would be proud.
The Week in Green
One of the most remarkable aspects of the green business movement is its sheer breadth. I know it has been said before that change will be required in every aspect of society if we are to deliver a low carbon economy and I know the phrase "there's no magic bullet" is parroted by environmentalists like it's some kind of cultish mantra, but that doesn't stop me being surprised by some of the niche solutions being proposed.
The old cliché that "every little helps" is only a cliché because it is true, and as such the sheer number of green technologies being designed for just one industry or to deliver a fractional saving in carbon emissions is hugely heartening.
This week alone we saw fuel that could be made from orange peel, a chemical process for capturing emissions from waste incinerators, a new carbon calculator for the wine industry, a new technique for turning plastic bottles into printer cartridges, software for cutting a few pages a day off the number of documents you print, and proposals for an increase in car sharing.
Taken on their own none of these innovations will deliver game-changing carbon emission reductions, but together they not only deliver worthwhile cuts but also emphasise the ever expanding reach of the environmental movement.
Of course, for real change to be delivered such niche developments need to be combined with economy-wide transformations, but again this week there are signs that after years of frustrations these may finally be on their way.
It seems strange to greet as significant something as ephemeral as an improvement in atmosphere, but the news of a thawing of relations between the US and the rest of the world at this week's climate change meeting in Hawaii is in many ways more significant than President Bush's pledge to invest $2bn in clean technology transfer. It appears that the politicians have finally begun to adopt the more collegiate approach to tackling global warming that has been pioneered by the business sector over the past few years.
Right I'm off to try and work out what zero carbon actually means.
Have a good weekend,
James


