Wednesday, December 9, 2009

Greentech business and climate change

First of all I would like to apologize to my “audience” for being absent since August (I can’t believe it’s been that long!).

The truth is we have been very busy in Israel G-Tek; we have executed our first investment in a wind turbine technology company IQWind which was recently named top 100 cleantech company of the world; we are also in the process of negotiating other deals.

Since August I attended the Boston Cleantech forum, went on a business trip to San Diego and then went on to Israel to, amongst other things, be part of Watech (one of the largest water and alternative energy conferences).

Also, since August the book Start-Up Nation came out, becoming an unintended marketing campaign for our fund.


First of all I want to disclose that I don’t consider myself a “tree-hugger”; my business associate is even less of a believer than me, he is into Greentech because he wants to stop oil dollars from going to countries such as Iran and Venezuela.

Regardless of your beliefs in climate change, there is a direct correlation between the truth of climate change and the future of greentech. More specifically, the relation is between people’s perception of climate change and the future of greentech (like my marketing expert wife says “perception is reality”)

Recent scandals in the scientific community have placed a black veil over climate change, bringing more people into the “doubters” side of the equation. But, what if I told you that we are in an almost irreversible path to wipe out humanity from the face of the earth?

If there was undeniable proof of extremely negative consequences, then people’s actions and business decisions would be very different. Perhaps CNN’s show will shed some light into this issue (Dec 9 CNN 8pm EST “Global Warming: Trick or Truth”).

The ugly truth is that the cards have already been played. We are not changing fast enough to prevent a global catastrophe (remember: we need to counter carbon emissions and pollution at a faster rate than they grow PLUS revert the existing damage already affecting the globe; in other words: the counter action has to be many times greater than the existing trend). Therefore we are set in a path to possible human annihilation (I am not exaggerating), our only hope is that we would be able to partially save ourselves with “last minute measures” or that the whole thing of climate change is a scam. What do you think?


Unknown said...

Climate change continues and we are constantly seeing more results. However you are the first business I have encountered to underline that at least part of your interest in greentech business development is based on energy "justice". Why say such things?

I am always scared when I encounter other than financial motivation when dealing with commercial propositions.

Tom Foale said...

I agree with Bohdan. Businesses that aren't focussed first on the bottom line are doomed. Besides, trying to stop people buying oil is futile - it's simple economics, oil is either more or less expensive than the alternates.

The role that climate change has in greentech is to influence the economics. Pollution of the environment by any means that the environment cannot naturally cope with, including CO2, is a 'tragedy of the commons' - people are using more than their fair share of a limited resource. Legislation should rebalance the commmons by penalising the over-users and rewarding those who reduce their usage significantly. This legislation makes it worthwhile for entrepreneurs to invest in greentech to help polluters reduce their impact by setting up a market in pollution.

darome said...

Climate change is very real, we see the effects.

We can and must make a diference.

Governmental economic attempts to stimulate change in any direction have historically failed due to inefficiency and poor management. Privately financed groups have always been highly focused and well managed. The results are obvious and crucial to our understanding of how we can influence the future of our children. We must influence privately funded and focused groups to invest in the Greetech business, its a win win situation. There is nothing wrong with making money if you are helping the world along the way. Look at the alternative, making money from dirty industry, which is obviously easier in the short run but very short sighted in the medium to long run.

We can and must make a difference.

Unknown said...

Having worked for government, I would add based on personal experience, that one reason why public spending to produce a desired effect often fails is that it very often goes to companies who know how to win government contracts. Although my experience is not exhaustive, I have noticed that companies rarely push back against government contract requirements on multiple million dollar multiple year contracts. Further once these contracts are let, even though they are open to adjustment, they rarely are adjusted because the environment or needs have changed, but often are modified because changing the contract is in the interest of the government.

My sense from the other side is that although I plan, and budget accordingly, I constantly am deviating from plan and budget to achieve the desired result.

My point is that targeted government spending is administered according to rules that allow recognition of changing government attitudes, but not changing realities. Whereas in business staying close to reality enables growth and development. The real issue is are we taking charge, responsibility, authority etc., for the environment or are we reacting to the opportunities it provides when in business? Is business a better manager than government of the perceived causes of environmental change? Obviously I am saying that, but in this issue we are entangled with government and bear responsibility for each other.

Unknown said...

Sometimes a refreshing opportunity comes along, when you can post a reply that differs with the original post and every other subsequent comment on almost every point. So here goes:

First, anyone who has read the details of the "scientific scandal" has learned this: The only scandal was the theft of the private emails from the research institution studying climate change. The email content itself revealed no coverup or distortion of the actual data which some non-climate change believers had hoped for. Whether this was wishful thinking or selfish thinking (some would like to wash away the threat of climate change so they could go on living their high-energy, high-pollution lifestyle undeterred) or political vendetta (so Al Gore could be called "wrong", is beside the point. Sorry, no scandal and no letup in the fact that we have a human-accelerated climate change process in the works.

That said, I think climate change is almost irrelevant to the matter of going green. And it is not just a matter of energy justice, being concerned where are oil dollars go. Yes, the reality is the oil money from industrialized nations is going to quite a few enemies of the industrialized world. But an equally large concern is that those annual cash outflows for energy have grown so large, and the cumulative totals so large, that they are destabilizing. The current world energy economy is leading us down a road of unbalanced world trade, collapsing western economies and of fully funded, potentially nuclear (or at least "dirty bomb")-enabled terrorists. We are more likely to become embroiled in endless Iraq's, Afghanistan's Pakistan's and Yemen's at a cost of a few trillion dollars on top of and as a result of misguided energy policy. And we are more likely to fuel the terrorism that threatens hundreds of millions people if this energy policy is not fully dismantled. So it is not a matter of simple economics, because of the embedded consequential costs of trade imbalances, the cost of multiple wars and thhe untold cost of both terrorism and the response to the threat of terrorism. Anyone looking at the full-life-cycle system cost here will come out with a very different set of purchase decisions if these elements are factored in. For that reason it is up to individual countries, the UN and the global climate change conference process to pass legislation that bakes in these costs to our decision-making, whether through carbon credits or other means. Without that, climate change or not, we are on a very dangerous path.

Unknown said...

The butterfly wing creates an eddy that changes the direction of a prevailing breeze and we encounter Hurricane Katrina. Most issues are indeed nuanced, and making good choices in our grey world often requires running through a number of scenarios before finally settling on an imperfect choice.

Energy consumption appears fairly straight forward, almost black and white. I need to visit my aunt on the other side of town so drive to see her for half an hour. The drive there is half an hour as is the return trip. I didn't count the energy consumed as I do this every week.

My friend in Africa also likes his aunt so the entire family sets out once a year to walk the fifty kilometers to visit their aunt. Four days later they arrive and spend a fortnight with her, then walk home.

My friend lives in Nigeria and they are energy exporters, and I live in Berlin and am an energy importer. My friend is very interested in getting a car so that he can drive once a week to visit his aunt, and I am very interested in getting the City to complete the new metro so that I don't have to drive to see my aunt, and thereby lower the amount of energy I consume.

My friend says that his dream of owning a car will likely never occur as the government and Muslim gangs in the Delta are very corrupt and they take all the money Nigeria earns from energy exports. He says he thought the situation might change when the Chinese came and muscled out the Italians, but it seems they cater to the gangs and government just like BP and Exxon. He told me in his last email he is thinking of joining a radical Baptist group that is planning to takeover Nigeria which will send out the army and nationalize the oil fields so that Nigerians can benefit from energy exports.

I replied that is the wrong thing to do as it will only hurt Nigerians. Instead I told him he should take part in actions like Earth Day and seek to raise public awareness on the misuse of energy revenues. He said that was pointless.

I agree with Todd that there are a number of baked in consequences and causes in the current world energy order, including the fact money from energy exports we buy often supports regimes and activities which is inimical to our way of life. However the way which we buy energy, from corrupted regimes such as Nigeria, or dictatorships like Azerbaijan is often equally inimical to to our way of life. Its a rather grey world out there and it costs a lot to keep it that way as it does to change it.

To me it seems we must decide first what we want today and tomorrow, what can we afford, and what we have the will to do. We can make individual choices, but far better would be for our society to choose as whole. Unfortunately our politicians frame the choice in black and white rather than in the grey of our everyday.

Anonymous said...

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Anonymous said...

Climate Change's role in GreenTech business is to wake us up to innovation. When my friends and family try to debate Climate Change with me, they quickly realize that there is nothing to discuss, as the risk of not doing something is greater than doing something and most of the world's scientists being wrong about whether or not climate change is happening.

The companies that will succeed in this Scientific and Social paradigm shift are those who realize that if they change the status quo, they will get millions of dollars of free advertising by reporters who want to write about their company. For example, Joe's Pizza (not the real company name) runs on 100% solar energy and is carbon neutral.

A great example of this is Interface Flooring. (

Israel is well positioned to succeed with its innovation society fabric and as the book "Innovation Nation" states, and I paraphrase, "When an Israeli thinks of an idea, they begin working on it right away."