Green Purchasing Asia :: October 2011

OCTOBER 2011 • Issue 5

PP17241/03/2012 (029499) • MICA (P) 256/07/2011

9 OPPORTUNITIES: Anhui to develop energy conservation potential 32 CASE STUDIES: Philippine geothermal giant greens the earth

PURCHASING

40 PEOPLE: Planet McCann chief on the power of procurement 44 EDITORIAL: Not so common sense of biomass projects

ASIA

54 INFO: Brazil powers into top 10 climate countries

the world at Population & sustainability

ISSN 2231-8135

05

9 772231 813001 MALAYSIA RM19.50. SINGAPORE S$9.50. BRUNEI B$9.50. OTHER COUNTRIES: By subscription only

billion

© - ALSTOM – Being

COMMITTING FOR TOMORROW A global leader in equipment and services for the power generation, power transmission and rail transport markets, Alstom has placed sustainable growth at the centre of its strategy, by developing innovative, environmentally friendly technologies. Each day, Alstom’s employees, spread throughout more than 70 countries, work to make our future better.

www.alstom.com

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Contents

PURCHASING

ASIA ǪǞǯǪǝǠǭ ɼɺɻɻ

From the managing editor’s desk

5

Buy into a green future

6

OPPORTUNITIES

7

Local PV subsidies pave way for national policy

7

TM R&D banks on efficient telco products

8

6XVWDLQLQJ ELOOLRQV LQ EXUJHRQLQJ FLWLHV

“We see ourselves as enablers. Our main focus is to create solutions which are green.”

(See pages 10–24)

Constant challenge-inprogress for a rising urban India

19

Dr Babatunde Osotimehin, UNFPA

China upbeat on building sustainable cities

20

Roadblocks to energy efficiency

21

15

“Tall buildings have always been drivers of innovation.”

Antony Wood, executive director, CTBUH

R e en So ne ew la rgy ab rp le ow er

g

m re E o en c le bil bu om ctric ity s mu nit y

G

m re R o en c ap bil in ha id ity se fra rgin rv st g ic ru es ct ur e

R e en W ne ew in rg ab d y le Po w er

S Sm ma ar rt g t b rid uil din

Resource recycling

“Whether we can live together on a healthy planet will depend on the decisions we make now.”

Building skywards: The solution to urban sustainability?

22

G

Transport

Manoj Menon, Frost & Sullivan

Water

S Sig ma na rt n ge av sy iga st tio em n

12

Energy

W R ate m egio r r an n es ag al ou em w rc en ate es ts r ys te m

Managing change in a crowded world

9

“It’s not possible for any one company to address the end-to-end needs of any smart city project.”

Smart cities of tomorrow

R re es R cy ou sy ecy cli rce st cli ng em n g

Anhui to develop energy conservation potential

17

S g m S rid art ho ma us rt e

The future of cities

Dr Gopi Kurup, TM R&D chief executive officer

Smart city management Energy

Transport

Water

Smarter city infrastructure achieved by fusing control and information Creation of new value through interoperation between smart city infrastructure

Future-proofing cities

24

Roundtable of babel

25

“We have an interest in making the palm oil industry sustainable.”

Adam Harrison, WWF

Banking on the fruits of sustainable agriculture

27

   •   

acicc malaysia sdn bhd

The double-platinum Diamond Building

editorial

44

Not so common sense of biomass projects

44

Get the edge with frugality

46

Impress, sport your low-carbon tee

47

Sustainability versus lavish lifestyles

48

Iceland blows hot on renewables

49

(See page 28)

case studies

28

people

36

information

50

Gem of a building

28

36

Recognition for green corporate leaders

50

Hope triumphs in Minamata

30

Econation building, one home at a time

“We see ourselves as provider of a total package.”

IGEM harvests a crop of green collaborations

52

Jeff Lee, managing director, Panasonic Malaysia

Brazil powers into top 10 climate countries

54

Automotive and electronics lead Interbrands’ global green list

55

Solar PV installation training centre to open

56

UK and Germany enter Asia’s green education market

57

Rising awareness boosts inverter market for RE systems

58

News briefs

60

Homework

64

Geothermal giant greens 32 the earth in more ways than one

Living and building green is affordable

38

“There are efforts to kill green businesses.”

Last mile, second wind before Malaysia’s FiT launch 1 2

Acid test for Unlocking

FiT in Malaysi

34

The power of procurement

a

the fifth fuel

4 What it takes 5 7

to tap RE for electricity RE investor s get FiT for guarantee Primer on Malaysi a’s FiT

PURCHASIN

ASIA

G

40 “Procurement is driving sustainability progress – probably more than anything else.”

Renewable energy

Malaysia ge ts FiT for action

Briomedia Green 3-3 Jalan Solaris Sdn Bhd (924679-H) 2, Solaris Mont 50480 Kuala Kiara Lumpur, Malaysia Tel: +603 6203 7681 +65 9068 0184 (Malaysia) (Singapore Fax: +603 ) 6211 2681 www.greenpurchasin gasia.com

Matthias Gelber, green activist

A joint project by Ministry of Energy, Green Technology Sustainable and Water Energy Developm Malaysia (KeTTHA ent Authority ) Malaysia (SEDA Green Purchasi Malaysia) ng Asia

Mike Longhurst, Planet McCann

Here comes the sun: Benefiting is believing 4 green purchasing asia • october 2011

35

Pathways of green collaboration

42

The team Editorial Editor: Lim Siang Jin Managing editor: David Lee Boon Siew Assistant editor: Siaw Mei Li Contributing editors: Ann Teoh, Jason Tan Contributing writers: Eleanor Chen, G Danapal, Stephen Ng, Ngam Su May, Nidhi Bhardwaj, Bhavani Prakash, Suvarna Beesetti, Tan Su-Yin, VK Shashikumar, Tejas Patel, Bruce Piasecki Columnists: Goh Ban Lee, Shel Horowitz, Khoo Hock Aun, Ning Yu, Prasad Modak Marketing & sales Manager: Yong Wang Ching +6012 205 7928 Sam Thong (Malaysia) +6012 361 0617 Lim Wan Tsau (Singapore) +65 9068 0184 Email: marketing@greenpurchasingasia.com Creative & design Khoo Kay Hong, Faye Phua Szeu Hwui Production & advertising traffic Eddy Yap Subscription & circulation Yap Eng Jin, Jessica Lee Finance & operations Kym Chong Corporate Managing director: Lim Siang Jin Publisher Briomedia Green Sdn Bhd (924679-H) 3-3 Jalan Solaris 2, Solaris Mont Kiara 50480 Kuala Lumpur, Malaysia Tel: +603 6203 7681 (Malaysia) Tel: +65 9068 0184 (Singapore) Fax: +603 6211 2681 Email: editor@greenpurchasingasia.com Printer KHL Printing Co Sdn Bhd (235060-A) Lot 10 & 12, Jalan Modal 23/2 Seksyen 23, Kawasan Miel Phase 8 40000 Shah Alam, Selangor, Malaysia Tel: +603 5541 3695 Fax: +603 5541 3712 © 2011: Briomedia Green Sdn Bhd Letters and articles are welcome, and should be addressed to: The Editor at Green Purchasing Asia 3-3 Jalan Solaris 2, Solaris Mont Kiara 50480 Kuala Lumpur, Malaysia Email: letters@greenpurchasingasia.com Endorsed by • Ministry of Energy, Green Technology and Water, Malaysia • International Green Purchasing Network

Disclaimer Briomedia Green Sdn Bhd (924679-H) believes that the information published at the time of printing is correct.

The views expressed in the articles are not necessarily those of the publisher. While the publisher has taken reasonable care in compiling the magazine, it shall not be liable for any omission, error or inaccuracy. Editorial contributions are welcome but unsolicited materials are submitted at the sender’s risk. The publisher cannot accept responsibility for loss or damage. All rights reserved by Briomedia Green Sdn Bhd (924679-H). No part of this publication may be reproduced without the publisher’s written permission.

Paper: Cover 180gsm Ningbo artcard PEFC; Text 80gsm Royal Express Silk PEFC/FSC

From the managing editor’s desk David Lee Boon Siew boonsiew@ greenpurchasingasia.com

About ten years ago, I was in Tokyo with my wife and young son. One of our most memorable experiences was The Japanese Commuter Train At Rush Hour. As soon as a train arrived, we were literally swept by an unrelenting wave of human traffic into a coach.

Although we tried to hold on to each other, my family was separated. We could see each other but it was packed so tightly we could not move our limbs. Really, we could have dozed off standing, which was precisely what some fellow commuters did. My son, then about three, was crouched in a corner near the door. If anybody were to drag him away when the train stopped at a station, I would have been quite helpless.

I recall this episode as I put this latest issue to bed, as it helps give a human dimension to the issue of a crowded world. Attendant to this theme is the rapid urbanisation that Asia is going through today. The best manifestation of that phenomenon is Greater Tokyo (population: 35 million), the world’s most populous metropolitan area.

We are heading for an Era of Mega Cities. Sixty years ago, there were only two cities with 10 million or more inhabitants. By 2005, their number had grown to 20, mostly in developing countries. The United Nations Department of Economic and Social Affairs reported that globally, urbanisation rose from 29% of the total population in 1950 to 50% last year.

We are concerned about how we will feed so many people, how we will clothe and shelter them and keep them employed. There’s also the question of their mobility and their energy needs.

These are concerns all governments must address. I am not one to worry about outcomes as I believe in Man's ability to adapt.

There are enough brains out there to address these problems, and enough multinational corporations who will turn crisis into opportunities. I have invited three of them to share their thoughts and technologies. The Council on Tall Buildings and Urban Habitat has also shared with us its vision of future buildings, or what architect Ken Yeang calls “vertical urbanism”. Frost & Sullivan managing director Asia Pacific Manoj Menon draws on his company’s research resources to outline a Mega Trend in Urbanisation.

In this issue, we also bring you the second and concluding part of our series on the Roundtable on Sustainable Palm Oil (RSPO), with revealing interviews with the WWF and Rabobank that help us understand how the organisation works, and why its work is important.

For those who were at the 2nd International Greentech & EcoProducts Exhibition and Conference Malaysia (IGEM 2011) but could not make it to the ministerial roundtable, we have an article on what was discussed at the open dialogue.

We round it off with coverage of Frost & Sullivan’s Green Excellence Award night in Singapore. We congratulate all winners and hope they join us in a special report due in December that will trace their “green” journeys.

Coming up next: Silicon Valley for water Once a water-stressed nation, Singapore is using its experiences, knowledge and organisational ability to build a global hydrohub that has drawn some of the biggest companies in the water industry. It has some groundbreaking projects in the pipeline.    •   

PURCHASING

ASIA 

Buy into a green future Green Purchasing Asia’s main purpose is to provide a well-structured avenue of immediately-useful information to buyers and sellers of green products and services in major sectors, especially in Asia, and to buttress the development of a business community around it.

The magazine will cover the following sectors, which have seen the greatest technological innovations and increasing economies of scale: • Renewable energy, including solar energy, wind power, geothermal and mobile applications • Biofuels from food and non-food sources, including palm oil, sugarcane corn and jatropha • Biomass from various organic, inorganic and mixed sources like oil palm, wood, sugar cane, corn and household waste • Green buildings and eco-cities covering, among others, green building certification programmes, environmentally sound building design and materials, retrofits, and resource-saving technology • Transportation, including plugin electric vehicles (EV), hybrid electric vehicles (HEV) and automobile alternatives like rail • Smart grids, which turn consumers into producers of energy, smart meters to track consumption and manage electrical flow and new interconnect standards     •  

• Water and waste management, focusing on desalination technology, reverse osmosis and wastewater and solid waste management • Energy efficiency, whereby technologies, processes, materials and design work together to maximise quality of life and industry output at minimal energy cost • Green finance, viz, venture capital and bank loans, grant programmes (NGOs and government) and government incentives.

To help readers navigate the magazine easily, we have divided it into five broad areas, each assigned a weightage to ensure consistent and adequate editorial space allocation.

• Opportunities: These include project announcements, tenders and new eco products and services. This will be a section heavy on actionable information.

Weightage: 30% • Case studies: We focus on projects that use green technolo-

gy, like eco-cities, solar farms and waste recovery projects in large plantations. In these articles, we will list out the names and contacts of developers, suppliers and contractors involved in those projects for networking.

Weightage: 30% • People: This section focuses on interviews with thought leaders and captains of industry in green businesses. We will also cover small and medium enterprises involved in trailblazing projects.

Weightage: 15% • Editorials: Opinion pieces, columns and feature stories on climate change, sustainable development and other relevant subject matters are the meat of this section. It is designed to provoke debate, so that by talking about issues, we think of new ways and approaches to solving problems. Weightage: 15% • Information: This includes news digest, events calendar, letters, reviews of books and reports on climate change, green technology or related topics, market entry conditions and new country regulations, policies and incentives.

Weightage: 10% Target readership The government’s role is not only to set the policy environment to drive the green agenda. It is also a massive market player in the economy, accounting for up to 30% of purchases. Any decision by governments to procure green will have a major influence on the market.

It is this dual role that makes governments important customers, which is why we are targeting 40% of our print and online circulation at senior government servants.

The remaining 60% will be aimed at the business community, international agencies and non-government organisations.

opportunities

 

Local PV subsidies pave way for national policy Qinghai, Shandong, and Jiangsu take initiative to revive Chinese PV market National subsidy policy needed because local subsidies are limited in reach

Three Chinese provincial governments are offering subsidised feed-in tariffs (FiT) to local solar photovoltaic (PV) power producers with hopes of reviving the Chinese PV market. The global PV market is in malaise due to policy changes in several European countries and this has also hit the PV sector in China, which heavily depends on the export market.

A recent news report said the Qinghai provincial government would invest 13 billion yuan (US$197 million) in PV projects totaling 800 MW. On May 9th, the Qinghai Provincial Development and Reform Commission announced a FiT of 1.15 yuan/kWh for PV stations established before September 30th – the project is dubbed the “930 plan”. Shandong’s provincial government is even more generous.

FiT for PV solar power producers is 1.7 yuan/kWh for those who started operations in 2010, 1.4 yuan/kWh for those starting this year and 1.2 yuan/kWh for those starting in 2012. Jiangsu, which pioneered fixed pricing for grid-connected PV power in China, set the following: 2.15 yuan/kWh for installations that began operations in 2009, 1.7 yuan/kWh (for those starting in 2010) and 1.4 yuan /kWh (2011).

Despite these initiatives, there is no national policy for grid-connected PV power generation, says Xiao Han, a new energy industry researcher at CIConsulting. Xiao says local policies are limited in focus and reach, and a national plan is needed. Nonetheless, the provincial initiatives may be an impetus for a national plan.

It remains unclear whether the Chinese PV market is benefiting from the local initiatives. There has been overcapacity in the polysilicon and PV equipment manufacturing industry over the last two years. Topped with market shrinkage and oversupply, prices fell badly despite assurances

There is, as yet, no national subsidy policy on PV power generation.

Nonetheless, the provincial initiatives do pave the way and provide a baseline for such development. that the situation is temporary.

The current difficulties are due to several European countries removing their PV subsidies. However, as traditional markets shrink, Chinese PV enterprises turn to emerging markets, including those in Asia. Xiao says while American, Japanese and Chinese PV markets are growing fast, they cannot

offset the drop in demand across the European Union.

Interested players need to consider, among others, power generation cost, energy demand from local economies, and governmental subsidies, when entering the PV market, says Xiao. Compared with traditional energy and wind power generation, large-scale PV power generation is still cost-prohibitive, and while local government subsidies are promising, they cannot drive the PV market across China.

The initiatives by Jiangsu, Qinghai and Shandong governments could serve as models to revive the Chinese PV market. Each is unique.

For instance, the price support offered by Shandong is higher than Qinghai’s 1.15 yuan/kWh, and is more attractive to investors. Nonetheless, given that Qinghai is on a high plateau with plenty of sunshine and a level of irradiation second only to Tibet, PV stations at Qinghai can generate more power, says Xiao. The central government can learn from these provincial governments when drafting a national policy. – Nanjing Shanglong Communications

Tariff support for grid-connected PV installations

Qingha: • 1.15 yuan/kWh to PV stations established before September 30th 2011

Shandong • 1.7 yuan/kWh for PV facilities that started operating in 2010 • 1.4 yuan/kWh (2011) • 1.2 yuan/kWh (2012)

Jiangsu • 2.15 yuan/kWh for gridconnected PV installations that began operations in 2009 • 1.7 yuan/kWh (2010) • 1.4 yuan/kWh (2011)

   •   

opportunities

 

TM R&D banks on efficient telco products Research company seeks partners to commercialise innovations Integrated communications and teleconferencing among its solutions

Telekom Malaysia Research & Development (TM R&D), one of two recipients of the Energy Management Gold Standard Certification One Star from the ASEAN Energy Management Scheme (AEMAS) in Kuala Lumpur, has developed an array of products that it is now ready to commercialise.

Out of a total of 750 Intellectual Properties (IPs) and 24 patents over the past ten years, some of the patents have been categorised as “green”.

For example, the team at TM R&D has found a way to prolong the life span of batteries by charging them during standby mode, thereby reducing the waste generated from discarded spent batteries.

Another example is that by providing a more streamlined, integrated “all-in-one” communications solution that allows the user to manage his voice mail, email, and fax messages in a common inbox, and enabling realtime sharing of information to speed up the making of business decisions irrespective of location, time or device used, there is no need for a different equipment for a specific application.

According to TM R&D chief executive officer Dr Gopi Kurup, another of his research team has invented a stable Millimeter Wave source for broadband wireless signal transmission using optical fibres. “Some of these innovations are ready for commercialisation, once suitable partners are identified.”

Gopi says his research teams have always been interested in energy efficiency and other green technology solutions. The company was earlier roped in to help the TM headquarters in Kuala Lumpur achieve maximum energy efficiency.

“Beyond that, whenever we talk about reducing energy consumption, we are not only talking about efficiency at our own facilities, but how we can     •  

 

By Stephen Ng

“This report will be escalated to technicians via SMS according to their designated location. The application also allows them to browse through 3G networks for a detailed problem report.

In essence, the ‘bumblebee’ allows the technicians to immediately rectify a particular problem in almost real time, while concurrently updating the status in the system.”

Gopi says the “bumblebee” has

Dr Gopi Kurup says although green has never been TM R&D’s main focus, his research teams have always been interested in energy efficiency and other green technology solutions that can benefit its clients

“We see ourselves as enablers, and our main focus is to create solutions which are green for our clients.” help reduce the costs of operating a business for our clients by their using more efficient telecommunication technologies. To what extent our technology is green, it is very subjective,” he says.

For example, he argues that the company has commercialised efficiency tools for the TM field force, which he considers as a green solution. The application, codenamed “bumblebee”, enables trouble tickets to be distributed to mobile phones.

“When a complaint or a trouble ticket is received from a customer by the customer care centre, it will be recorded in the system that automatically generates a report for the services required,” he explains.

enabled TM technicians to shorten the turnaround time for complaints. “We can easily commercialise the product if there are interested parties to partner with TM R&D to market the system regionally.”

TM R&D is also involved in another research: an Internet Protocolbased video conferencing application, also known as the IPVC. “This is designed using widely available and cost-effective high-definition (HD) computer peripherals to support the video conferencing system,” he says.

“When our clients are able to conduct their meetings using teleconferencing, we have helped them cut down on the need to travel long distances for meetings. This is why, as a telecommunications company, we see ourselves as enablers, and our main focus as a research and development organisation is to create solutions which are green for our clients. The secret of our success is that we try to focus on areas that we are good at.”

opportunities

 

Anhui to develop energy conservation potential Key sectors include engineering, support services, recycling and reuse of waste Specific companies named for support to move industries forward

In line with China’s 12th five-year plan spanning 2011-2015, Anhui province has rolled out a masterplan to tackle its environmental conservation problems and to tap business potential in the sector. Anhui has made big progress in energy conservation and emission reduction since 2006, with large organisations cutting their energy consumption in the most energy-intensive areas. Overall, energy consumption in proportion to the province’s GDP has dropped. In 2010, carbon dioxide emissions dropped by 2.5% and sulphur dioxide emissions by 2.7%, when compared with 2005 levels.

Ahhui’s green industry made 35.4 billion yuan (US$5.5 billion) in 2010, with a profit of 3.2 billion yuan.

Sales of environmental equipment and products amounted to 2.5 billion yuan; energy-saving equipment and products, 3.6 billion yuan; energy-saving technical services, 1.1 billion yuan; and the recycling and reuse of waste material, 18.2 billion yuan.

However, Anhui lags behind its neighbours and faces severe challenges in meeting standards for energy conservation and emissions reduction.

Although the energy conservation and environmental protection industry has been growing rapidly in recent

years, the province is home to just a handful of large firms in the sector.

Existing firms are located too far from each other to benefit from any agglomeration effect. The sector is also beset by relatively backward technologies, and is weak in equipment manufacturing as well as in research and development of new technologies and products. Service industries, including environmental oversight, audit, legal consulting, and trade and financial services are underdeveloped.

Lastly, there are no government policies to support the sector. An absence of regulations and lack of proper pollution controls on industrial sites and of funding to run them, as well as the high cost of credit, have hampered the sector’s development.

Masterplan targets for 2012 • Environment industry: annual output value of 75 billion yuan (US$11.7 billion), with annual growth of at least 20%. Some 25 billion yuan to come from energy conservation, 35 billion yuan from waste recycling and reuse, and 15 billion yuan from environmental protection • Energy conservation and environmental protection segments to each have 30 companies with annual output of more than 100 million yuan, five to ten companies each with

annual output of more than 1 billion yuan, and environment-protecting equipment manufacturing bases • Investment in R&D: energy-saving engineering research and corporate technology centres to be built and 100 new patentable environmental technologies and products to be developed • Policies, regulations, technical standards and a technical innovation system coupled with a competitive service ecosystem

Key areas to be developed • Promote R&D, production and wideuse of energy-efficient technologies, equipment and products • Help set up service companies that provide energy-efficient design, measurement and auditing of energy use as well as energy management and consulting services • Build intelligent urban sewage treatment and pollution control systems, and develop technologies to protect drinking water resources • Promote clean combustion technologies and develop equipment for the scrubbing of exhaust gases • Develop technologies and facilities for treating household, medical, industrial and hazardous waste and sludge to reduce, detoxify and reuse the residue. A series of household garbage incineration and sludge recycling demonstration facilities will be set up in 2012 • Encourage production and use of environmentally-friendly and renewable materials and products • Set up recycling networks and government-run portals where prices for services can be listed. – Nanjing Shanglong Communications

Projects slated for support by the Anhui provincial government • Development of the province’s leading energy-efficient equipment manufacturers including Maanshan Iron & Steel, Anhui Conch Kawasaki Energy Conservation Equipment Manufacturing and Anhui Jinding Boiler • Chizhou Zheyuan Paper’s project to replace coal-fired boilers with biomassfuelled ones, as well as Chizhou 325 Power Generation’s biomass-fuelled power boiler renovation project

• Construction of Chery’s National Energy-Efficient Automobile Engineering & Technology Research Centre • Anhui Shilin Lighting, Anhui Qianzheng Optoelectronics and Anhui Shengzhiyuantong Photoelectricity to develop LED indoor and semiconductor lighting products and high-frequency induction lamps • Anhui Gujing Group Jiufang Pharmaceutical’s deployment

of water treatment facilities and Anhui Liquid-Filtering Equipment Manufacturing’s commercialisation of new environmentally-friendly water treatment equipment • Selected major recycling projects involving the reuse of waste and residues, including several household appliance recycling projects, and Anhui Xinke New Materials’project to melt down and reuse scrap copper in new products

   •   

The world population reached the one billion mark at the beginning of the 19th century.

Later this month, it is predicted to touch seven billion. That’s one heck of a jump, by any reckoning.

    •  

Although birth rates are declining, the number of people added to the global population will remain high for several decades. Most of this growth will occur in the less developed countries in Africa, Asia and Latin America.

Among the resultant trends is

How will governments

unbridled urbanisation, as people

and private corporations

migrate to cities in search of jobs and a

respond to the challenges

better life. What lies ahead is the Age

ahead? What are the

of Mega-cities, an era when the best

drivers of growth in the

technologies will be put to the test

years to come?

to manage our insatiable appetite for energy, water and food.

   •   

  

The number of people added to global population will remain high for decades, even as growth rates continue to decline Cities learning to cooperate in finding solutions to their most pressing habitat problems

By staff writers



UNFPA executive director Dr Babatunde Osotimehin

“Whether we can live together on a healthy planet will depend on the decisions we make now,” said UNFPA executive director Dr Babatunde Osotimehin at the launch of a global advocacy campaign on population issues on World Population Day, July 11th.

Renowned naturalist Sir David Attenborough captured the grim realities of an overcrowded world in a lecture entitled “People and Planet” earlier this year: “It remains an obvious and brutal fact that on a finite planet, hu    •  

Naturalist Sir David Attenborough  

At the end of this month, it is predicted that Mother Earth will welcome her seventh billionth child. Where that baby will be born is anybody’s guess, but the odds are good that it will arrive wailing in an Asian country like China or India, the two most populous nations.

We have been extremely productive, and we are living longer. Some 82 million people – equivalent to the population of Germany – are added to our number each year through natural increase, or the difference between births and deaths.

While most of these births would be deemed happy occasions, the challenge of coping with so many people is straining the capacity of the less developed world, where 97 out of every 100 people are being born, the United Nations Population Fund (UNFPA) notes.

man population will quite definitely stop at some point. And that can only happen in one of two ways. It can happen sooner, by fewer human births – in a word, by contraception. The alternative is an increased death rate – the way which all other creatures must suffer, through famine or disease or predation. That, translated into human terms, means famine or disease or war – over oil or water or food or minerals or grazing rights or just living space.

There is, alas, no third alternative of indefinite growth.”

Divided opinions However, opinions are sharply divided over whether these troubles have their roots in population pressure per se.

David Satterthwaite of the International Institute of Environment and Development says instead that the total impact of development is a factor of consumers, affluence and technology.

In a similar vein, iconoclastic British journalist George Monbiot describes it graphically: “Someone I know who hangs out with the very rich tells me that in the banker belt… there are people who heat their outdoor swimming pools to bath temperature, all year round. They like to lie in the pool on winter nights, looking up at the stars. The fuel costs them £3,000 (more than US$4,600) a month. One hundred thousand people living like

these bankers would knacker our life support systems faster than 10 billion people living like the African peasantry.”

In “Population: One Planet, Too Many People?”, a report released early this year by IMechE, the Institution of Mechanical Engineers, author and head of energy, environment and climate change Dr Tim Fox was optimistic about food supply. “We can meet the challenge of feeding a planet of 9 billion people through the application of existing technologies.” For example, in Africa, half of the food produced is destroyed before it reaches the local marketplace, a problem that can be solved through refrigeration and infrastructure.

A milestone in the argument for appropriate development was achieved

by Frances Moore Lappe, Joseph Collins and Peter Rosset in their epic 1998 work World Hunger: Twelve Myths.

They point out that even in the worst years of famine, there is enough grain Development activist Frances Moore Lappe   

Managing change in a crowded world

to provide everyone in the world with 3,000 to 4,000 calories per day, not counting all the other food sources.

Also, countries with a comparatively large share of agricultural land per person have some of the most severe and chronic hunger problems in the world. Severe hunger is a recurring problem for many people in Bolivia, for example, where there is well over one-half acre of cultivated land for every person – significantly more than in France.

Techniques to boost production have been the central thrust of the war on hunger. But when a new agricultural technology enters a system where British journalist George Monbiot   

opportunities

there are power inequalities, it tends to profit only those who already possess land, money and access to credit or political influence. Therein, say the authors, lies the rub.

Bomb, warned of mass starvation in the 1970s and 1980s due to overpopulation. The book was criticised in recent decades for its doomsday outlook and inaccurate predictions, but Ehrlich has essentially stuck to his views.

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Author Paul R Ehrlich

Population increase unprecedented Whatever the views are about the population debate, it is undeniable that the increase in population is “unprecedented”, in the words of the InterAcademy Panel Statement on Population Growth, which is ratified by 58 national academies.

Indeed, most of the population growth has taken place very recently.

Only at the beginning of the 19th century had it reached 1 billion. For 750 years prior to the Industrial Revolution, it had remained under 250 million, “locked in a seemingly permanent

Declining birth and death rates Ironically, both birth and death rates have declined over the past few decades in industrial and developing countries because of increased access to immunisation, primary health care, and disease eradication programmes, according to the World Bank. In addition, with greater access to education and jobs, more women are starting their families later and are having fewer, healthier children.

The population growth rate, even in less developed countries, according

equilibrium of birth and death rates”.

Rev Thomas Malthus, the 18th century English scholar, won his place in history by promoting the alarming view that population growth is ultimately checked by famine and disease.

This underlying fear that we will be destroyed by uncontrolled population growth lingers till today, despite a wealth of contrarian evidence.

Paul R Ehrlich, a latter day Malthusian and author of The Population

Delhi, India

Mexico City, Mexico

19.5

19.4

13.1

Tokyo, Japan

14.6

Karachi, Pakistan

Shanghai, China

36.7

8 7

16.6

Mumbai, India

20.0

São Paulo, Brazil

Top 10 mega-cities

Dhaka, Bangladesh

22.2

New York-Newark, USA

6

Calcutta, India

20.3

15.6

5 4

World population growth through history 2.5 million 7000 BC years

6000 BC

5000 BC

4000 BC

Billions of people

Modern Age

Middle Ages

Iron Age

Bronze Age

New Stone Age

New Stone Age commences

Old Stone Age

3 2 1

Black Death – The Plague 3000 BC

2000 BC

1000 BC

1 AD

1000 AD

2025 AD

Sources: The Christian Science Monitor, SUSPS

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the US-based Competitive Enterprise Institute.

Municipal solid waste generation for selected large cities in Asia

Mongolia China

kg per capita per day 2

1995 995 95 Pro Projectio rojectio tio tion 20 005 005

Bangladesh

Laos

Nepal

Japan South Korea Hong Kong, China

Vietnam 1

Burma Philippines

India 0

Sri Lanka

Malaysia Thailand Singapore

Human Development Index 2002 0,49 0,6 0,7 0,8 0,93

Indonesia 0

1,000 km

Country not included in the study Source: Human Development Report

to the United Nations World Population Prospects, declined from 2.09% in 1950 to 1.33% in 2010, and is expected to drop further to 0.50% by 2050, based on the medium variant.

Because of the large and increasing global population size, however, the number of people added to the world population will remain high for several decades, even as growth rates continue to decline. Most of this growth will occur in the less developed countries in Africa, Asia, and Latin America.

Age of mega-cities Among the resultant trends is the often unbridled growth in urbanisation. The United Nations Department of Economic and Social Affairs (UN DESA) reports that globally, urbanisation has risen from 28.83% of the total population in 1950 to 50.46% last year.

Remarkably, in 1800, a mere 3% of the population was urban-based, according to the US Population Reference Bureau. The American Farmland Trust contends that an astounding 70% of prime or unique farmland in the US is now in the path of rapid development.

With increasing urbanisation comes the age of mega-cities, those     •  

which have 10 million or more inhabitants. In 1950, there were just two such conurbations. By 2005, their number had increased to 20 and it is projected that there will be 22 megacities in 2015, 17 of them in developing countries.

In most developing countries, spontaneous urbanisation through the irregular occupancy of public or private land forms the greater part of cities, and is the face of urban poverty.

In the Millennium Declaration, the international community recognised that to halve by 2015 the proportion of people living in extreme poverty, it will have to directly address the needs of the burgeoning population of poor people living in cities.

Another issue is urban sprawl, which the US Environment Protection Agency describes as low-density, automobile-dependent development beyond the edge of service and employment areas.

Critics of suburbia argue that this pattern of development causes an increase in traffic congestion, lengthens commuting time, increases air pollution, destroys farmland, reduces open space, and imposes additional costs on neighbouring cities, according to

Sustainable cities On the bright side, cities are learning to cooperate in finding solutions to their most pressing habitat problems.

Among the outstanding examples is Melbourne, which embarked on a transformation in the 1990s from a sprawling and car-dominated area to a compact and sustainable one. Today, the city of 4 million is considered one of the most liveable in the world.

Energy-efficient buildings are greening Melbourne’s cityscape, from public offices to new private developments.

Detroit, long a symbol of urban failure, is witnessing many initiatives for downtown improvement. City officials have committed to “shrink” the city and to relocate residents downtown. Additionally, more than 600 community gardens are being grown in Detroit, with food-sufficiency as the long-term goal.

In 2007, Torraca, a town in southern Italy, made a decision to replace the incandescent lights in all its street lamps with light-emitting diodes (LEDs). These are powered by three solar energy stations, allowing this portion of Torraca’s public infrastructure to be entirely self-sufficient and run 100% off-grid. Replacing incandescent lighting with LEDs has led to a 70% saving in public energy and maintenance costs.

Rio de Janeiro’s comprehensive public transit system used to bypass its favelas or shanty towns. Traditional public policies towards favelas generally consist of either demolition or neglect – leaving entire communities outside of the city, without any basic services. Now Rio’s gondola systems literally fly over these hilly and winding neighbourhoods. Not only does the gondola connect the shanty towns with the rest of the city, but it also makes them more visible and shows that they can’t be ignored.

In China, the government has been bullish on building sustainable cities that are replicable throughout the huge country. With innovations like these, the way ahead for a sustainable future looks brighter for tomorrow’s global village. And for businesses, the problems that arise are ripe with opportunities.

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The Sky Farm envisions the future city as a series of urban farms located on building rooftops and connecting skybridges, creating a set of planes useful for agriculture as well as recreation

Building skywards: The solution to urban sustainability?

Architect calls for tall building types to be designed as “vertical urbanism” Facilities that exist on the ground need to be replicated up in the sky

By Sreerema Banoo Rapid urbanisation, particularly in existing cities that generally attract migrants, exert significant pressure on existing urban space and infrastructure. So how do we ensure urban growth is sustainable?

Council on Tall Buildings and Urban Habitat (CTBUH) executive director Antony Wood believes the answer lies in increasing the density of cities.

Wood, who is also associate professor at the Illinois Institute of Technology in Chicago, says denser cities with concentrated land use and infrastructure offer more sustainable patterns of life.

To achieve denser cities, the solution is to bring the city up to the sky.

Writing in the Asia edition of Modus, a publication by the Royal Institution of Chartered Surveyors, he says tall buildings have an important role to play in the viability of our ever-growing urban footprint on the planet. Such a role, though, calls for a new breed of skyscrapers because in their current form, most tall buildings

are energy profligate – there’s higher energy consumption for operating and maintaining the buildings as well as higher embodied and operating energy needed to construct them.

For tall buildings to serve as a sustainable solution to urban growth its typology needs to be reinvented, says Wood. Some of the considerations for the typology include variation in form, texture and scale; the inclusion of communal spaces; greening and landscaping; and the addition of skybridges.

“We need to bring all aspects of the city up to the sky. If cities are looking to concentrate perhaps 10 or 100 times more people on the same land through building tall, they need to replicate the facilities that exist at the ground up in the sky, including the parks and the pavements, the schools, and other public and civic functions,” he adds.

Dr Kenneth Yeang of TR Hamzah & Yeang Sdn Bhd says, in reinventing

the tall building type, structures must be designed as “vertical urbanism”, and tall building design must be regarded as “vertical urban design”.

“We need to view all those aspects of urban design that are conventionally crucial horizontally, and transpose these vertically, as urbanity in the sky. For example, a consideration in urban design is place-making.

Vertical urbanism requires us to ask, ‘what is place-making in the sky’?” says the award-winning architect who’s regarded as the pioneer of the bioclimatic skyscraper.

In cities or locations that are already dense, such as Hong Kong and Singapore, Yeang suggests looking at intensifying existing tall built forms by linking tall buildings horizontally at upper levels. He also proposes better use of the spaces between buildings, the use of spaces over existing roads and motorways, as well as improved urban design and physical planning.

Moving from concept to reality, he tells Green Publishing Asia, is “not such a big deal”, adding that “it just requires a change in mindset in architects and planners to rethink the design of the tall building type, as opposed to designing them conventionally as repetitive homogenous trays stacked one on top of the other with singular built form uses instead of multiple uses.”

Yeang also believes that such tall buildings will not require new construction and engineering technolo   •   

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TATA Tower, an urban parking development proposed for India’s largest car company that also taps on renewable energy to power itself, its vehicles, and neighbouring towers     •  

Proponents of tall buildings as a sustainable solution to urban growth say such buildings need not involve increased costs in construction, as landuse will be intensified. In implementing sustainable strategies, Wood says it will be up to the developer to convince tenants and users that the extra costs

© , ,  

gies, but simply a rethink of the way we use existent engineering and construction systems. “What is crucial is to use clean tech engineering systems that are carbon neutral, and construction systems that facilitate disassembly, reuse and recycling.”

Wood reckons that this new breed of tall buildings is a market issue, involving not only direct benefits such as lower energy costs in the long run, but also communicating a message.

“There is already a lot of research into making buildings more energy friendly.

The Commerzbank Tower in Frankfurt, Germany, is considered the first sustainable tall building in Europe. It was commissioned by a company that wanted to show that it took its social responsibility seriously. Being very visible in the urban landscape, a tall building can be a great way to express a trend, a vision or a message. For this reason, many new tall building projects seek energy certification, such as LEED in the US,” he tells Green Publishing Asia.

The Skybox uniquely comprises individuallystacked “boxes” which are inspired in function and orientation by differing physical aspects of the city e.g. horizon views. Each “box” responds to the individual needs of the occupants and the surrounding urban context

of implementing these strategies are actually investments because they pay off in the long run.

He adds that in a number of older tall buildings that have been given a green retrofit, the costs have a payback time of between three and five years.

Such was the case with the Empire State Building in New York City. In addition, energy saving was estimated at 38%.

Nonetheless, proponents concede that making tall buildings part of the solution for sustainable urban growth is not without challenges.

“Tall buildings have always been drivers of innovation. To build taller, one often runs into new problems,

© , ,     

Khel Tower, a vertical sporting facility proposed for Mumbai. A series of hotel towers lean past each other to allow views of the city and ocean, with suspended sporting facilities and fields in between

which need creative thinking to overcome them,” says Wood. He adds that presently there are a number of tall building projects that are experimenting with implementing sustainable technological innovations. For instance, wind turbines are integrated in tall buildings like the Pearl River Tower in Guangzhou, the Bahrain World Trade Centre in Manama and the Strata SE1 tower in London.

“The net effects of these strategies can be proven in theory, but it takes time, tweaking and monitoring to develop these ideas into strategies that can be implemented on a broader scale. It takes a certain courage and willingness to invest in these strategies,” he adds.

And that willingness is there, says Yeang. “We are beginning to see this shift towards this approach to design-

Yatra Towers, a series of linked towers proposed for Mumbai which retains the sense of the community and industry of the low-rise area which is swept into the sky

ing the tall building. The problem is not with convincing clients and developers per se, but getting planning approving authorities to permit such building typologies.”

© , ,   

© , ,     

opportunities

Chicago Gateway, a proposed set of connected towers which connect Lake Michigan with the highlevel urban environment via a large, floating “green podium.” This takes advantage of hydroponic farms, and becomes a vertical interface in a city network of green roofs connected by skybridges

opportunities

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The future of cities Many of the new smart and sustainable cities will be from China and India

1950s – Urbanisation

Companies need to team up to fully address end-to-end needs of any smart city project

By Manoj Menon Rome was one of the first cities in the world to reach a population of 1 million people. This was in the year 5 BC. It took about 18 centuries for the next city, London, to reach a population of 1 million. This trend of urbanisation gathered incredible momentum in the 20th century.

Urban population has increased from about 13% (220 million) in the 1900s to reach about 49% (3.2 billion) by 2005 (Source: United Nations, Department of Economic and Social Affairs). The primary reason for urbanisation is best explained by the fact that the top 25 cities of the world today account for half of the world’s wealth.

While the world population continues to grow, urbanisation will happen at an even more frantic pace in the coming decades. By 2020, we expect that close to 60% of the world population will live in urban cities. I need not say much about the impact this trend has had on business, society and cultures in the last 100 years.

Many industries such as real estate, infrastructure and transportation have benefited tremendously from this mega trend.

Our Frost & Sullivan studies also show that the rate of urbanisation is faster in developing countries. We believe half of the world’s mega-cities will be from developing countries by 2025.

As we look ahead into the next decade, we will see the integration of the core city centre with suburbs and daughter cities, resulting in expanding city limits. The figures to the right show the development of cities over a period of time.

The future impact of the city’s development on mobility, working life and societies is going to be tremendous. We believe three concepts of urbanisation will emerge: Mega-cities, mega regions and mega corridors.

• Mega-cities: Integration of the core city with suburbs and housing over 5 million people.

• Mega regions: Integration of two or more cities or expansion of city to join with adjoining daughter cities to form mega regions housing over 15 million people. For example, Johannesburg and Pretoria (forming Jo-Toria).

• Mega corridors: Urbanisation corridors connecting two or more mega-cities or mega regions converging to form mega corridors.

These can be 100 km apart in distance and have populations of over 25 million living within the corridor. The Hong Kong-Shenzhen-Guangzhou mega corridor in China has a population of 120 million people.

The mega-cities, mega corridors and mega regions will be in a continuous race to attract the brightest talent and the world’s best companies.

As the cities, regions and corridors get crowded, they will exert tremendous pressure on the infrastructure and on the planet. This will drive the trend to the development of smart cities. The illustration on the next page defines the various essential components of the smart cities of the future.

The primary emphasis of the smart city will be to increase the productivity of the citizens, enhancing its competitiveness whilst making the best use of scarce natural resources.

This can be achieved through the effective use of information and communication technology (ICT).

Minimising CO2 emissions will be the other important component of the smart city plan. We believe over 40 global cities will emerge and be labelled as smart cities by the year 2020. Many of these cities will be from the developed markets of North America and Europe.

Many European cities such as Amsterdam, Copenhagen, Oslo and Cape Town have already done a good

Creation of the historic centre and districts

2000s – Suburbanisation

Urban sprawl, first highways and ring road

2015 – The network city

Third suburban area and cities along the highways created, ring road overblown by the urban sprawl

2020s – Branded cities Ring road motorway, living areas growing outside the ring road as seen in London

Mega-city trend • City borders will expand out of suburbs to include daughter cities; the core city will enclose multiple downtowns • Multiple transportation models will be used and more than 50% will use public transportation • Most offices move to the first belt suburbs except non cost-sensitive activities: city centres become shopping areas (small-scale deliveries) for expensive goods and living areas for “double income, no kids” households.

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opportunities

ď˜”ď˜“ď˜”ď˜™ď˜?ď˜…ď˜˜ď˜?ď˜“ď˜’ ď˜Ź ď˜—ď˜™ď˜—ď˜˜ď˜…ď˜?ď˜’ď˜…ď˜†ď˜?ď˜?ď˜?ď˜˜ď˜?

job in positioning themselves as green cities. For example in Amsterdam, the policy makers have set an ambitious target of reducing CO2 emissions by 40% by 2025 (from 1990 levels). This policy encourages the use of public transport, imposes congestion charges and stiffer parking tariffs in the city, cuts down parking spaces in the city annually and enables more charging stations for electric vehicles. Many cities have also set ambitious targets of having at least 10% of the total car population be electric vehicles by 2020.

Most of the North American cities are focusing their efforts on the use of innovative technologies. Boulder in Colorado will be among the ďŹ rst smart grid cities with an investment totaling US$100 million. Cities like Los Angeles and San Francisco will likely emerge as hubs for electric vehicles in the United States. A lot of work is now being done in the areas of water conservation, energy efďŹ ciency, waste management and low-impact living.

In Asia, the development of Masdar City in Abu Dhabi will result in a research hub for green eco concepts.

This city aims to be the world’s ďŹ rst carbon-neutral, zero-waste city, fully powered by renewable energy. The city is being developed by the Abu Dhabi

offering their knowledge and services to other emerging cities in the area of city planning.

It is also very clear that it is not possible for any one company to fully address the entire end-to-end needs of any smart city project. Companies who wish to be successful in addressing this opportunity will need to forge strong partnerships with different participants in the ecosystem.

The policy-makers in government agencies are also setting their sights on important opportunities. In addition to enhancing their city’s competiveness, they believe the right policies will encourage the development of local companies which can then succeed in the global marketplace. SpeciďŹ cally in Malaysia, where there have been several projects to develop cities, townships and corridors in the last decade, local companies have gained signiďŹ cant experience in expanding their capabilities. The emphasis now has to be on packaging these capabilities in a holistic manner and marketing them on a global scale.

future energy company with a budget of US$22 billion.

There will also be a number of new cities built from scratch that will adopt the principles of smart and sustainable development. It is no surprise that many of these new cities will be in China and India.

This is being done to decongest the population in the mega-cities and support continued economic growth.

The Gujarat International Tech City is being built to cater to India’s large ďŹ nancial services potential by offering global ďŹ rms access to worldclass infrastructure and facilities.

The city planning is done in such a way that residences and ofďŹ ces are located within a radius of 5 to 10 km in the integrated township.

A large number of global players from diverse industries such as energy, automotive, IT, telecommunications and building technologies are making signiďŹ cant investments to reap the beneďŹ ts of this mega trend.

There will be a convergence of competition and we will see the entry of new players with capabilities to provide fully-integrated, sustainable and customised smart city solutions.

Many well-planned and developed cities such as Singapore are today

The writer is partner & Asia Pacific managing director of Frost & Sullivan, and is one of the region’s most soughtafter speakers and thought leaders

Smart cities – “Green� replaced by “SMART� concepts Elements of a smart city

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Governance Citizens

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ICT

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City planning

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ICT

Smart information communication & technology Telematics, navigation, smart metering, internet technologies

n

Smart city planning EV charging, smart grid, bus rapid transit, parking infrastructure, congestion charging

Smart energy Renewable energy, smart grid infrastructure

Adapted from graphics by Frost & Sullivan

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opportunities

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..

Constant challenge-in-progress for a rising urban India 68 Indian cities will have population of over 1 million people by 2030 Capex of US$1.2 trillion needed to meet projected demand of Indian cities

By Tejas Patel

If India continues with its unplanned urbanisation policies, the quality of life in the cities will deteriorate dramatically

Urban India in 2030 • 590 million people will live in cities.

This is 278 million more than the US population today • 68 cities with more than 1 million people, 13 cities with more than 4 million, and six mega-cities with 10 million or more • To cope with this rise in urban population, India will have to build between 700 and 900 million sq m of residential and commercial space a year, equivalent to adding two more Mumbais or one Chicago every year Source: McKinsey & Company

Projecting population growth in India can be depressing work, given the fact that even improving the quality of life today seems to be a constant workin-progress.

The reality on the ground is this, as seen through the lens of a 2010 McKinsey study: “Life for the average city dweller in India is tough. Across India, urban citizens have access to only 105 litres per day of potable, piped water supply, as compared to a minimum basic requirement of 150.

Only 63% of the population has access to sewerage and septic tank facilities, and only 30% of sewage generated actually gets treated.

This is true even for large cities. Mumbai, for example, treats only 30–40% of its sewage.” There’s more. Chronic lack of investment in public transportation has resulted in a significant decline in share of public transportation, from nearly 40% in 1994 to 30% last year. There are also not enough good roads for private vehicles. The traffic jams are horrendous at 170 vehicles per lane km.

Other indicators, including housing, utilities and energy, are just as dismal. This is where the real challenge is

for the government of India. Providing a sustainable quality of life, keeping in mind the rising urbanisation, is a gigantic task considering that India's cities are not providing even the basic standard of living for their residents, says the McKinsey study titled “India's urban awakening: Building inclusive cities, sustaining economic growth”.

The government will have to provide access to clean water supply, full coverage and treatment of sewage and solid waste, good quality affordable education and health care, affordable housing, open spaces, preservation of natural resources and ensuring access to clear air, water and land.

It has to reduce energy consumption in buildings, appliances, lamps and street lights. It has to promote use of renewable energy like solar power and wind. The study adds that urban planners will have to “improve city design to develop energy-efficient clusters to abate nearly 30 million tonnes CO2e.” It says the government will also have to aim for “reduction in vehicle emissions by nearly 100 million tonnes of CO2 equivalent through greater use of public transportation, improving vehicle efficiency, and use of electric vehicles.”

It is estimated that given the rise of population in urban India, 2.5 billion sq m of roads will have to be paved, and 7,400 km of metros and subways will have to be constructed.According to available data, till March last year, 524 projects were sanctioned under the Urban Infrastructure Governance (UIG) component of the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) at an approved cost of over US$12.1 billion, including additional central assistance of more than US$5.64 billion. About US$2.57 billion has been released for implementation

of projects and procurement of buses.

About 45.83 km of metro lines was added in Delhi and the National Capital Region, and Noida was connected to the Delhi Metro network.

New metro projects were taken up in Chennai for 45 km at a total cost of US$3.06 billion and in Mumbai for 11 km at a cost of US$492 million.

India, in the next 20 years, needs to invest US$1.2 trillion to strengthen her cities for the growing urbanites. If she continues with her current policies, the urban areas may progressively decay and face a gridlock, the study warns.

The Associated Chambers of Commerce and Industry of India (Assocham) also cautioned that the country's economic growth story could be at risk unless “higher budget allocations are combined with right policies and timely implementation to improve civic amenities and infrastructure in urban areas.”

Reforms that India needs to undertake, according to McKinsey • Funding: Ensure that public infrastructure development keep pace with the needs of cities as they develop • Governance: Cities should have local "owners" and be more accountable to residents for effective urban management. The current approach of running the city from top-down (state to local) has to go • Planning: A shift from ad hoc and sporadic to planned and facilitated urban growth • Sectoral policies: Need for a systematic set of policies for key urban sectors compared to the piecemeal approach • Shape: Need to facilitate a distributed shape of urbanisation, ensuring cities of all sizes can thrive by using a longterm strategic approach.

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opportunities

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China upbeat on building sustainable cities Urban population expected to touch 51.5% in next five years

China’s urbanisation rose by one percentage point every year over the last 30 years, a key trigger being the national economic reform. In graphic terms, this means an average of over 10 million rural folk have settled in China’s cities every year.

Presently, 47.5% of the world’s most populated country live in the cities. This is expected to touch 51.5% in the next five years, according to the country’s 12th FiveYear Plan. This means that 50 million more people from the countryside will move to cities during that period.

This phenomenon is expected to continue unabated and rapidly for a considerable period of time, and will boost domestic and investment demand. Recently, a United Kingdom energy report showed that China consumed 20.3% of the total energy produced worldwide last year, with the United States coming a close second at 19%. China accounted for between 46 and 47% of global coal consumption.

Li Bingren, chief economist of the Ministry of Housing and Urban Rural Development, told the 14th China Urbanisation Forum held in Liaoning province in July that boosting the urbanisation rate is one of the core national strategies, with a key target being to ensure that urbanisation is sustainable.

“The China Development Report 2010: China’s New People-Centered Urbanisation Strategy”, released by the China Development Research Foundation last year, advocates an urban population of 65% by 2030, when 400 million more migrant workers and their families will move into cities. It also     •  

 

Government urged to deal with haphazard development on fringes of existing cities

land has been expropriated, causing an increasing number of farmers to lose their farm land. Currently, 40 to 50 million rural residents have lost their farms, and by 2030, the figure is expected to grow to about 110 million.

Helping the landless farmers cope will be a primary task for the authorities.

Adding to the litany of urban woes are resource shortages, pollution, delays in infrastructure construction, poor urban planning and provision of public spaces, traffic congestion, the widening gap between urban and rural economies, and reduced urban management capabilities.

These issues are pushing China to build a sound resources pricing system to encourage energy conservation and to develop environment-friendly cities,control pollution, promote clean production, optimise urban utilities and infrastructure, and put into practice sustainable traffic management, as well as orderly development of urban clusters.

It is interesting to note that the level of urbanisation in Anhui, a province often derogatively regarded as the “country bumpkin” region of China, is estimated to hit 50% by end 2017.

By 2030, Beijing’s urbanisation is expected to reach 70%, close to the level of cities in the most developed countries. Even Liaoning province, a province with few major urban centres, is expected to reach an urbanisation rate of around 70% by the end of 2015, with an urban population of more than 30 million.

Wuhan, the capital of Hubei province, has plans to improve its urbanisation to over 80% by 2020.

This is similar to the planned target for Kunming, Yunnan province’s capital, where the permanent population is expected to reach 10 million within five years and 11.8 million by 2020.

Already, five cities – Shanghai, Beijing, Tianjin, Guangzhou and Chongqing – have a permanent population exceeding 10 million.

– Nanjing Shanglong Communications

advised the government to deal with peri-urbanisation – the unstructured and haphazard development of fringe urbanised areas on the outskirts of existing cities – within the next 20 years.

The absorption of such huge numbers of workers is costly. According to a survey, it costs about 100,000 yuan (about US$15,385) to settle in each migrant worker. In other words, the country needs to pay two trillion yuan (about US$307 billion) to help 20 million farmers become city dwellers each year.

In addition, only 280,000 sq km, or 3% of the country’s total land mass, is available for the building of towns and cities and the industries to provide jobs for the masses. The newly published “2011 City Development Report of China” by the Chinese Academy of Social Sciences states that because of the accelerated urbanisation and industrialisation, a lot of rural

opportunities

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Roadblocks to energy efficiency Energy literacy vital to manage price volatility and payback

 

Energy savings of 10 –25% possible by approaching efficiency systematically

As cities grow larger, energy consumption rises in tandem. It is critical for governments and companies to look at how our machines can be made more energy-efficient

A world with seven billion people presents some staggering social questions. According to the International Energy Agency (IEA), global energy consumption is predicted to increase by 96% in 2035 against that of 2008. Meeting this demand will require adding one new power plant and all related infrastructure every week for the next 20 years.

Since the industrial revolution began 200 years ago, there has been a strong correlation between economic growth and energy use. Reducing – or even breaking – this link has become one of today’s most vital challenges.

ABB partnered with the Economist Intelligence Unit and Enerdata to produce “Trends in Global Energy Efficiency”, which includes a global survey of 348 senior executives. Almost 90% of the surveyed manufacturers said energy efficiency improvements will be critical for business success in the next two decades. However, only 34% of them had done a company-wide energy audit

and only 40% said they had invested in energy efficiency in the past three years. Understanding the drivers behind this gap is critical to bringing about meaningful change.

Who owns energy efficiency?

Although there is an increasing convergence between electrification and automation systems, these are often run as separate pockets of activity. In an ARC Advisory Group 2010 energy management survey, 42% of respondents said automation was not represented on their energy management teams.

Most modern manufacturers have robust quality programmes that integrate operations and procurement.

Such collaboration helps optimise purchasing activities and delivers cost savings such as reduced inventories.

Yet, a surprisingly small number of plants look at energy in the same collaborative manner, even though it is a cost and a source of waste.

According to the ARC Advisory Group, a plant can achieve energy

savings of 10–25% by taking a systematic, strategic approach to energy efficiency. The business impact can be significant for industries where energy is a significant percentage of production costs, such as cement (30–40%) or steel (as much as 50%).

Energy literacy Many companies take a reactive approach to energy. For instance, they look for fast solutions when energy prices rise or when new regulations come into force. However – just like operational excellence – the best energy efficiency benefits are achieved when there is a process and commitment for continuous improvement.

One of the largest challenges is for companies to develop energy literacy and transparency – understanding where and how power is being used in their operations and buildings. ABB has demonstrated that companies can achieve energy savings of 10–15% simply by making energy usage and savings visible. Monitoring and reporting software can help plant managers set energy savings and efficiency targets, and process operators can view performance in real time and make better decisions, or even automate efficiency by linking energy management to control systems.

At a higher level of collaboration, manufacturers can plan and optimise their energy procurement by accurately predicting production demand. For example, they might schedule a certain energy-intensive process when electricity rates are lowest, or postpone some activities if their energy demand will exceed supply – which is often penalised by higher utility tariffs. The net result of this collaborative approach is reduced consumption and CO2 emissions, and increased productivity from the energy the plant does use.

Financial challenges A lack of energy literacy can cloud the business case for energy efficiency as much as it clouds process decisions.

Many industries do not have a baseline for energy efficiency, so it’s difficult to benchmark performance. And, price volatility in today’s open energy markets can raise scepticism over payback calculations, especially when    •   

opportunities

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relying on “energy savings x cost” as a decision metric.

Such factors make it difficult for energy efficiency initiatives to compete in the boardroom against growthoriented alternatives such as capacity extensions, product innovation or new sales resources. This is especially true when energy efficiency improvements have an upfront cost of capital – even if they will produce greater life-cycle savings compared to less capitalintensive projects.

Although many governments offer investment incentives, the commercial banking world has not yet developed a broad range of finance offerings for energy efficiency projects.

New financing products need to be developed that ensure risks and benefits are distributed fairly among all stakeholders, which can be offered at rates that make a good business case.

Manufacturers and their suppliers have learned to unlock the power of collaboration; many of these have emerged from the recent economic turbulence as stronger companies.

Energy efficiency requires this same collaboration competency – for both a competitive advantage and for a sustainable future in a world with seven billion people. – Courtesy of ABB

Case studies of ABB projects that save energy • Auto and tractor tyre factory Where: Valladolid in northern Spain Customer: Michelin, one of the world’s top two tyre manufacturers An energy audit showed that the 436 low-voltage motors in the factory had a low efficiency rate of 76.9%. Energy consumption will be reduced by almost 400,000 kWh a year by replacing them with high-efficiency motors.

The payback time for each of the motors that ABB is replacing is estimated at just 1.4 years. Another bonus: the estimated reduction in CO2 emissions for the factory is 213 metric tonness of CO2 equivalent a year.

• Natural gas compression • DC power distribution station and treatment system to green data plant in the Republic centre Where: Lupfig, in northof Congo (Congocentral Switzerland Brazzaville) Where: M’Boundi oil field Customer: green.ch, near the Atlantic coast a leading ICT service Customer: Eni Congo SA, provider a subsidiary of Italy’s Eni This data centre has The project is part of been selected as ABB’s Congo’s “zero flaring” demonstration site for programme to reduce its new direct current emissions from the (DC) technology, and will burning of excess be used as a showcase fuel, and use locally for international data extracted energy more centre customers efficiently. Natural gas seeking to profit from that was previously this groundbreaking flared off and wasted at technology by reaching existing oil processing new benchmarks in operations will be energy efficiency for data used to substantially centre technologies. increase Congo’s power DC technology generating capacity, trims power conversion and provide the country losses and is 10 to with a reliable source 20% more energy of electricity. Excess efficient than traditional gas will be re-injected alternating current into the reservoir. The (AC) technology for plant is scheduled for electrical distribution completion in under two in data centres. It is an years. ideal solution for data centres as it minimises footprint, installation and maintenance costs.

Smart cities of tomorrow High hopes on technologies and systems collectively known as “intelligent water” that incorporate IT into the water cycle New demand-side equipment, including electric vehicles and hybrid electric vehicles will be widely adopted

The urbanisation of populations is proceeding at a rapid pace in emerging markets including China, India and other Asian Belt nations and the countries of Central and South America. New cities, including ecocities, are now planned to contain huge populations which will encourage the establishment of nearby industries that can provide employment.

Urban development is no longer treated as public works handled by government agencies. More of such projects are being undertaken as     •  

investments, particularly in emerging markets. In Malaysia, for instance, plans are afoot for the construction of a new city as an investment for the Employees Provident Fund. Another example is the Tianjin Eco-city which is taking shape in China as a joint investment by a Singaporean government-run fund and the Chinese government. Hitachi is a collaborator with Sino-Singapore Tianjin Eco-city Investment and Development Ltd Co. This change has led to the construction and operations of entire

cities being viewed as commercial enterprises. It creates a need for the efficiency of urban development and city management to be considered from the earliest stages.

Another change is the involvement of information technology (IT) companies. Around the world, these companies are offering proposals for collecting and analysing huge volumes of data generated by urban activities to improve the efficiency and quality of urban life. Supply and demand side data is used to achieve efficient operation of energy, water and other city infrastructures. The move towards creating greater addedvalue in cities through information processing and improvements to the efficiency of city operations represents new opportunities in the field of urban development.

All these changes lead to the eventual creation of smart cities. These

opportunities

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R e en So ne ew la rgy ab rp l ow e er G m re El ob en c e il bu om ctri ity s mu c ni ty

G m re Ra ob en c p il in ha id ity se fra rgi rv st ng ic ru es ct ur e

R e en W ne ew in rg ab d y l e Po w er S g m Sm rid art ho a us rt e

R re eso c R y u sy ecy cli rce st cl ng em in g

S Sm ma ar rt g t b ri ui d ld in g

Energy

 

Water

S Si ma gn rt ag na e vi sy ga st ti em on

Resource recycling

W R ate m egi r r an on es ag al ou em w rc en ate es ts r ys te m

Transport Smart city management Energy

Transport

Water

Smarter city infrastructure achieved by fusing control and information Creation of new value through interoperation between smart city infrastructure Source: Adapted from Hitachi

are the individual technologies and solutions required:

Managing energy Cities of tomorrow harness wind, solar and other renewable energy to provide distributed power sources to complement conventional power plants which are centralised. Also, the need to handle the fluctuation in output that is a characteristic of these new power sources will mean that batteries will play an important role.

It is anticipated that new demandside equipment, including electric vehicles (EVs) and hybrid electric vehicles (HEVs), will become more widely adopted. Energy management systems need to be able to support the diversified energy sources and new issues that come along with it.

Managing water resources The incorporation of more intelligence into water infrastructure and management of water sources, distribution and resource recycling is an essential requirement. Water treatment plants and sewage treatment plants are also part of the network that establishes high-quality water supply and sewage infrastructure.

Many emerging markets in particular suffer from a shortage of water.

High hopes are placed on the technologies and systems collectively known as “intelligent water” that incorporate IT into the water cycle.

Mobility The growing role of public transportation to reduce automobile reliance has made the development of energy-

saving technologies essential. The development of charging stations and other EV infrastructure with the aim of creating a low-carbon city by reducing dependence on vehicles powered by internal combustion engines, are also critical. Cities of tomorrow need an approach to transportation based primarily on EVs and HEVs.

Information technology Different information are used in urban living and daily urban activities in turn produce huge amounts of data. Data centres, servers, storage systems, digital signage and security solutions facilitate a more comfortable and secure way of life. A liveable city that provides good quality of life is one that is connected, automated and smart.

– Courtesy of Hitachi    •   

opportunities

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Future-proofing cities

The Urban Sustainability Centre is under construction in London

By 2030, cities must invest about US$40 billion in their infrastructure



Two new centres of competence for cities to be set up in Asia and the US

Cities today house more than 50% of the human race and, based on urbanisation trends as well as demographic changes, could make up as much as 60 – 70% of the population by 2025.

As dynamic markets for energy and goods, cities consume large quantities of natural resources in order to ensure supplies of energy and water. They also produce considerable amounts of environmentally harmful emissions.

Additionally, they must provide the logistics and infrastructures needed to meet their populations' mobility requirements. By 2030, cities must invest heavily in their infrastructure – an estimated US$40 billion.

Shanghai, Berlin, Johannesburg, Sao Paulo, New York – as much as these cities differ from one another, people living in them all ask themselves the same questions: How can we reduce emissions? How can the city guarantee clean water supply?

How should we handle the expanding population, the traffic, and the increasing energy requirements?

Technology, in particular green technology, is the key to making cities fit for the future. To enable a better focus in providing sustainable products and solutions especially for cities, Siemens is forming a new sector, which effective from October 1st, 2011, manages its worldwide cities and infrastructures businesses from Munich. In addition to the Centre of Competence     •  

for Cities and a Centre of Urban Sustainability which is now being established in London, the group is creating two more centres of competence – in Asia and the US – to share ideas with opinion makers and customers.

Products and solutions from Siemens’ environmental portfolio reduced its customers’ annual carbon dioxide emissions by around 267 million tonnes last year. Half of its total revenue is generated from this portfolio.

In the “Metropolitan Solutions” exhibition space at the Hannover Messe held earlier this year, Siemens presented solutions from the energy and industry sectors and, at the same time, offered a preview of its new infrastructure and cities sector. Lighthouse projects in Singapore, London, Dallas and Berlin show how collaboration across sectors and divisions can capture the “city” market.

But how does the company work with cities to keep these complex living spaces functioning and to guarantee a high standard of living?

Berlin – bustling metropolis Each year, Germany’s capital city invests 17.2 million euros (US$23.7 million) in its energy supply. Berlin worked with Siemens Financial Services to upgrade to energy-saving technologies using the energy-saving

contracting concept, which includes technology and financing from a single source. Intelligent energy management, for example, controls the generation and supply of heating and thereby reduces the city’s CO2 emissions by 25%. That’s 29,000 tonnes, and puts roughly 5.3 million euros back in the city’s coffers.

In the area of mobility, Europe’s largest and most advanced traffic control system manages traffic based on the actual situation. Traffic information for all highways, streets, and tunnels in the metropolitan area is continuously recorded and centrally transmitted.

This information is used to control more than 2,000 signaling systems to protect the city from gridlock.

Dallas – an energy bundle In 2005, Texas made a commitment to increase the percentage of “green” energy in its power supply. The aim was to enhance the transmission capacity of wind energy and to broadly implement smart meters. Siemens delivered the systems for the two network control centres in east and west Texas.

Data from 3.2 million customers is now integrated, enabling optimal control of the grid.

Siemens was recently named the most sustainable in its sector by the Dow Jones Sustainability Index (DJSI) for the fourth time in a row.

– Courtesy of Siemens.

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8 OPPORTUNITIES: &KLQD ĆŠUP RQ UDLO expansion despite funding hiccup 34 CASE STUDIES: The windmills of Bangui

PURCHASING

40 PEOPLE: GE’s Azli Mohamed on expanding ecomaginatively 48 EDITORIAL: Algae for biofuels: A promise in waiting

ASIA

ď˜–ď˜—ď˜”ď˜“

Roundtable of babel

54 INFO: Australia carbon tax unlikely to drive up renewables

Sustainable palm oil:

Is RSPO the answer?

ISSN 2231-8135 04

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Concluding our series on the Roundtable on Sustainable Palm Oil (RSPO), two more “knightsâ€? champion their cause. Adam Harrison of WWF provides broad insight into a hoary other-world of sustainable business while JosĂŠ den Toom, chief risk oďŹƒcer of Rabobank, Singapore speaks up on the business case for sustainability

By Jason Tan

This land is your land, this land is...

But how easy has it been to convince the multinational growers of the RSPO not to expand? It is less complex

and more proďŹ table to open new plantations than to make current ones more efďŹ cient, which might also require costly replanting. And this is before the value of timber concessions are reckoned for.

Here is where pragmatism happens: the RSPO standard does not prevent expansion at all, says Harrison; it requires you to assess whether or not the land you are expanding on is valuable for wildlife conservation or to the communities who live on it.

The RSPO guidelines allow expansion on “low-conservation“ or agricultural land, for example.

ď˜›ď˜›ď˜Š

It’s all very clever to gather the tribes around the table for a pow wow, but the need to accommodate all views makes for progress that squeaks along rather than much-needed catharsis by thunder and lightning. “We tend to move at a slower speed because we can only push people as far as they have common ground on, so there are some things we have compromised on,â€? admits Adam Harrison, the senior policy ofďŹ cer for food and agriculture at the WWF, based in Scotland.

The nature of its roundtable process means the speed afforded by ďŹ at is not available to the RSPO, notes the executive board member, but adds that the decisions it ultimately yields are stronger than most, “though (they are) maybe not as radical as some of the membership would likeâ€?.

Still, pragmatism is not the only language spoken here. There are principles from which the WWF will not deviate, says Harrison. He looks the elephant in the room squarely in the eye and says: “The problem of deforestation and the oil palm industry really needs to be addressed. If this principle was not there (part of the RSPO guidelines), we would have to question whether we would be a part of the RSPO.�

Another over-size question is standards for greenhouse gas emissions, which the roundtable is grappling with. “We just need to make sure that’s successfully completed.�

Harrison: “We have an interest in making the palm oil industry sustainable.�

The benefits of show and tell The incentive for multinational growers to adhere to RSPO guidelines is that “they get to show that they’ve been acting responsibly�, and this gains them access to markets such as the EU, where the consumer demands that companies using palm oil demonstrate exemplary business behaviour towards the environment.

Harrison says this is “the key beneďŹ t of getting on board with the RSPO standardsâ€?, which stake their credibility on the multi-stakeholder process of its roundtable. He claims 25% of all palm oil used by food

processors in the UK is now certiďŹ ed.

He acknowledges however that the RSPO’s halo by association may not yet apply to India, China, Indonesia and, to a lesser extent, Malaysia, the current and future lynchpins of the palm oil sector – and whose consumers are less demanding of ecolabelling.

He concedes that awareness of certiďŹ ed sustainable palm oil (CSPO), which took a while to raise among consumers in Europe, might need to be stoked differently for markets such as China – rather than being consumer-led, the demand for premium sustainable palm oil needs to be spearheaded by the likes of (RSPO member) Wilmar, which has its own plantations, processing plants and trading facilities, and supplies the bulk of China’s palm oil. “I wouldn’t suggest Wilmar take on the entire demand of introducing CSPO in China, but I think they can certainly be the ďŹ rst actors to move, which would then allow others the space in which to follow on,â€? says Harrison.

Good table manners Around the table of the RSPO, the warring tribes are animated by the seemingly contradictory beliefs of proďŹ ting from nature’s bounty and saving it from plunder. As Harrison sees it, there may soon be no planet to proďŹ t from, and the big boys know this. “The big multinational processors and growers know that if they want to be in business in ten or 20 years – to be a sustainable enterprise – they have to tackle the issues now. If they carry on as they have, they know they would be limiting their options in the future.â€? ď˜‹ď˜–ď˜‰ď˜‰ď˜’ ď˜”ď˜™ď˜–ď˜‡ď˜Œď˜…ď˜—ď˜?ď˜’ď˜‹ ď˜…ď˜—ď˜?ď˜… • ď˜“ď˜‡ď˜˜ď˜“ď˜†ď˜‰ď˜– ď žď źď ˝ď ˝ ď žďĄ

How receptive are the multinationals in the RSPO to the proposals put forward by their erstwhile mortal enemies, the social and environmental NGOs? “Yeah, it’s always the case that the RSPO is the place for very robust discussion.

But what has always surprised me is how all the members actually want to engage and find some consensus they can all live with.

“We’ve had some very difficult arguments in the past,” he admits, “greenhouse gas standards being one good example. It got very close to individual parties walking out of the RSPO but the bigger prize of agreement is far more valuable to all sides. People are willing to compromise.”

    •  

The truth is out there And so the theory goes that green NGOs are funded by parties who want to see the demise of the palm oil industry.

Harrison leaves no doubt about WWF’s stance: “We believe the industry is very good for Indonesia and Malaysia, and will be for Africa, Latin America, and elsewhere in the world.

It creates lots of wealth for countries,



A bargain, but for whom?

That said, the representation of NGOs in the RSPO, by type and in number, is noticeably outgunned by the multinational stakeholder group, an observation with which Harrison concurs.

He would like to see more local NGO representation from the regions where oil palm is grown by smallholder communities, and also of environmental NGOs dealing with specific landscapes. Their absence means that “we don’t often get those perspectives argued strongly within the RSPO decision-making process”, he notes. “The NGOs that are there attempt as hard as they can to represent those interests, but they are overstretched and can’t represent the wider interest. And that, I think, is a weakness (of the RSPO).”

The fact that the RSPO functions by consensus at all decision-making levels prior to its general assembly voting process, provides for a check and balance in ensuring genuine consent to the adoption of a resolution, but it cannot make up for a lack of expertise in drawing up the resolution in the first place.

“I would encourage many more NGOs to join, and the RSPO needs to be more flexible about membership requirements, which it is doing,” he says, adding that the RSPO needs to work out better ways of consulting with the membership to make sure poorer organisations have an equal voice. “It

is much easier for the likes of WWF and Oxfam, who have the capacity to engage, but it should be made easier for everyone to do that.”

Fresh fruit bunches (FFBs) are sterilised using steam in large pressure cages like the one above.

This is the first step in the extraction of crude palm

it will create lots of jobs and income for individuals, smallholders and companies; it’s a very rational thing to do with land that’s suitable to grow oil palm. We don’t have any interest in destroying that; we have an interest in making the industry sustainable.”

“We’re certainly not in the job of boycotting or asking for a ban on palm oil; we know that’s a futile thing to do.

Whatever [certain NGOs] bring to bear in Europe and the US – which are small markets for palm oil – China, India, Indonesia and Malaysia are never going to stop producing it. We need to engage positively with the industry in these regions to make it sustainable.”

“Sustainability isn’t too radical” In this sense, the palm oil sector could

be said to be embedded in the global economy. Its plantations support the livelihoods of many in the developing world, while the few multinational traders and food processors ”valueadd” to the commodity, which they buy on the global market, and move its pricing. Consumers pay a premium for the manufactured product; the more they consume, the greater the contribution of the palm oil sector to global economic growth.

Some radical alternatives to the status quo, in the interests of social justice and the planet, are a pricing structure more equitable to the growers, and to reconsider the premise of infinite growth on a gasping earth.

Harrison has this to say: “I would argue that sustainability isn’t too radical; sustainability is about the industry itself recognising how it can improve and how it can be made to have less of an impact on the environment for a better future.”

He adds that improved efficiencies, such as planting on grasslands (which locks up GHGs rather than releases them) and less wanton timber concessions mean that oil palm has “huge potential to be sustainable… before we move on to tackling how to moderate consumption.” The sector could be “the gold standard for the most sustainable vegetable oil globally – poster boy rather than bad boy.”

Something happened on our way to a new business model The RSPO was set up as a businessto-business platform for companies to set themselves a higher performance bar. Now comes the hard part: implementing those standards, and ensuring their compliance. “They’re now coming up against the bigger questions, such as policies and global trade structures,” Harrison says. “I think the RSPO is now starting to recognise those constraints, as well as what businesses are doing to sort themselves out internally with processes, standards and systems.

Alignment between what governments require and RSPO wants is a very live issue that the RSPO is trying to tackle now.

How successfully? He allows for a chuckle: “Very embryonic…”

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Banking on the fruits of sustainable agriculture Rabobank uses RSPO’s standards to guide its own CSR is a key component in the bank’s assessment criteria for potential clients

By Jason Tan

lend money and earn money, in order for sustainability to become the norm, the answer is a clear no,” says Toom.

However, while banking principles are not in need of an overhaul, she makes the distinction between these and what informs their practice.

“We need to adapt the way we look at things [to the tenor of the times], such as the way in which we define acceptable clients to the bank. But in essence, we will always only do business with clients we find acceptable.”

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“Palm oil companies that do not effectively address sustainability issues cause serious ecological and social damage and create a significant business risk,” notes José den Toom, chief risk officer of Rabobank, Singapore.

Rabobank Group is a Netherlands-based international financial services provider. It focuses on the food and agribusiness sectors.

This, and some ten million customers in 48 countries, mean it is in a position of some influence in regard to the ongoing discovery of “sustainable business”.

As public opinion continues to swing towards the need for environmentally sound businesses, so has the number of standards and certification bodies grown. Rabobank’s own process of greening its supply chain led to it discovering the Roundtable on Sustainable Palm Oil (RSPO).

“By supporting the RSPO standards and adopting them as our own, we have made our lives easier when assessing compliance of our clients in the sector. On the other hand, by endorsing a leading standard, we help grow the impact of that standard, which further helps us to fulfil our own targets of contributing to sustainability in the sector.”

All of which lead to the following questions: Is the current business of banking sustainable? How pressing is the need to develop new standards of assessing risk and reward for sustainable agribusiness ventures, such as those of the RSPO’s members?

“If you are asking whether there is a need for any bank to change the fundamental principles by which they

“Companies that do not plan for tomorrow or for contingencies are poorly run companies, which equates to a higher risk.”

She notes that this “acceptability of clients” for a multinational is largely dependent on public opinion; the financial crisis has crunched some countries harder than others, where the reputation of bankers and financiers is now mud. The same, however, has not yet happened outside of the US and Eurozone.

“Rabobank does move along on the waves of changes in the larger society and the general consensus of what are acceptable norms and

standards in business,” she says of public opinion. “We operate both in the areas where trends are being set and in the areas where trends are followed.”

In the former markets, she says: “Our clients may demand certain assurances from us that, in turn, become the norm for us in our business conduct.”

Otherwise, Rabobank’s policies “are designed to encourage companies to choose sustainable business practices and, in extreme cases, exclude unsustainable practices.

[This] makes good business sense: companies that do not plan for tomorrow or for contingencies, are poorly run companies, which equates to a higher risk.”

Interestingly, Toom describes corporate social responsibility (CSR) as a “key component” in the bank’s assessment of its potential clients, and mandatory for all corporate lending in the wholesale banking division.

“We use it to identify areas in which we need to engage our customers on issues regarding sustainability.

The underlying premise of the RSPO is that agribusiness, which may be defined as industrial-scale farming, the global trade of commodities and the processing and manufacture of food, is ultimately sustainable. Does Rabobank subscribe to this belief?

Yes, says Toom, noting however that, “in its current form and incarnation, agribusiness may not be as sustainable as it can be.”

“More can be produced with less,” she says, adding that this requires “an efficient and effective supply chain in which both industrial-scale farming, global trade and small-scale farming [co-exist].”    •   

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case studies

The double-platinum (GBI and Green Mark) Diamond Building began operations end-June 2010

Project details • L: P, M • O: E C  M • A: NR A • P A: D S B T • M C: P P C S B • M  E E: P E S B • S C: IEN C S B • C A: P S B • C  S E: P SM C • L A: KRB E D S B • Q S: ARH J B S B • A: T GBI P   BCA G M  B O P

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Gem of a building Energy savings of almost RM1 million every year in operational costs Green cost is only 6% with a payback period of 3.5 years

By Suvarna Beesetti The Diamond Building in Precinct 2, Putrajaya, the administrative capital of Malaysia, is the first building to be awarded the Malaysian Green Building Index (GBI) Platinum award and the Singapore Building & Construction Authority (BCA) Green Mark for Buildings (Overseas) Platinum award.

Officially launched by deputy prime minister Tan Sri Muhyiddin Yassin in May 2011, the building is home to the Energy Commission of Malaysia. It is also IEN Consultants Sdn Bhd’s third green building project in Putrajaya, the first two being the Green Energy Office (GEO) Building, currently the most energy-efficient office building is South-east Asia, and the Low Energy Office (LEO) Building.

So what makes the Diamond Building so impressive? According to associate director and energy consultant of IEN Consultants Gregers Reimann, a normal building in Malaysia consumes about 210 kWh/ m² year. In comparison, the Diamond Building consumes just under one third of that, or 65 kWh/m² year (excluding the energy generated by solar photovoltaics).

He says: “The building was designed to have an energy index of 85 kWh/m²/year, so, right now, it is actually more efficient than what it was designed for. However, we need to keep in mind that the building is not yet fully occupied. Even so, the energy index should still be within the design

on the roof of the Diamond Building provide about 1,400 kWh/kWp per year or 10% of the building’s energy needs.

This has helped cut its energy bill by about RM40,000 every year.

With the implementation of the feed-in tariff, this savings is estimated to be about three to four times higher.

This also translates into a savings of 63 tonnes of CO² which, together with the 1,350 tonnes of CO² savings from energy efficiency, is equivalent to taking 700 cars off the road, assuming that each car travels a distance of 12,000 km per year.

The Diamond Building also adopted the Floor Slab Cooling (FSC)

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target with full occupancy.”

When the idea for the Energy Commission of Malaysia’s new headquarters was first conceptualised back in 2005, there were suggestions for a landmark building in terms of design and sustainability, one that would achieve the BCA Green Mark Platinum award, which was the only regional green building certification scheme available at that time.

A study trip was soon organised for the consultants to study some of the sustainable and energy-efficient buildings around the region, including Singapore and Thailand. In Thailand, the group visited several buildings designed by renowned Thai architect Dr Soontorn Boonyatikarn, leading to his appointment as the principal architect for the new building.

Says Reimann, the shape of the building came about after a study of the solar path for the site was conducted. He says: “We found that a 25° tilt angle of the facades ensures that the north and south facades are fully self-shaded during the hottest mid-day hours. As for the east and the west facades, the tilting facade helps to reduce the solar impact by 41%.”

One of the major design targets for the Diamond Building was to make it highly daylit. During the day, daylight is deflected onto the ceiling by the facade mirror light shelf system which ensures a good daylight distribution of up to 5 m from the facade.

Workstations are located in these well-lit areas, while the public areas such as the corridors are located in the centre where there is the least amount of light. In addition, each workstation is also provided with a task light, which promotes lower energy consumption compared to a traditional office.

Reimann says: “For the lighting system, we saved almost 80% of energy, half from the use of energyefficient lighting fixtures and half from use of daylighting. The atrium, on the other hand, was designed to optimise daylight utilisation with reflector panels and an automatic roller-blind system that responds to the intensity as well as the angle of the sunlight.”

Thin-film solar photovoltaic (PV) panels, currently the most efficient type in Malaysia, that were installed

Reimann showing off the Diamond Building postage stamp, which is part of a three-stamp series on sustainable buildings that includes the Green Energy Office (GEO) Building and the Low Energy Office (LEO) Building

Performance summary The Diamond Building began operations end-June 2010. Its main environmental performance comprises the following: • 57% electricity savings (CO2 emission savings correspond to taking 324 cars off the road) • 71.4 kWp solar PV plant (CO2 emission savings correspond to taking 30 cars off the road) • Water-efficient fittings, rainwater harvesting and grey water recycling (water saved corresponds to consumption of 12 households) • Conducive working environment (50% daylighting, good air quality and passive slab cooling) • Additional savings come from the 35% savings on the district cooling consumption for the building Source: IEN Consultants Sdn Bhd

technology, the second building to do so in Malaysia after the GEO Building.

Reimann explains that the technology makes the building structure function as a thermal storage system by embedding flexible 22 mm PERT pipes in the reinforced concrete slabs during construction.

He says: “At night, 18°C cold water is circulated in the slabs to cool them down to about 21°C. During the daytime, the system is shut off, and the floor slab passively absorbs heat gains from people, computers and solar gains.”

He pointed out that the advantages of the floor slab cooling system include reducing cooling transport energy by 64%; shifting much of the cooling to the slabs so that the air handling unit (AHU) system can be down-sized by about 30%; and shifting 30-40% of the cooling to night time so that the building can enjoy lower off-peak energy rates.

The Diamond Building has another unique feature to boast of, the first-of-its-kind heat recovery shower system, which was installed for the convenience of those who opt to cycle to work. The system provides hot showers that are heated to about 38°C by solar heating.

In this case, the copper pipe of the incoming cold water, which is about 27-28°C, is coiled around the pipe of the outgoing hot water, which allows the latter to transfer about 30-40% of its heat to the incoming pipe. This reduces the energy demand of the heater.

Reimann says: “In the big scheme of things, this system does not make such a big impact as the energy consumption for heaters is very little.

However, it is a fun installation and we installed it in such a way that people can see how it works. Hopefully, the system will inspire more people to give more thought to heat recovery systems.”

The Diamond Building also has in place a grey water system. Instead of going to the sewer, all water from the sinks and floor traps (grey water) is piped separately through a sand filter to a collection tank from where it is re-used for the irrigation of a miniwetland.

This system helps recycle about    •   

case studies

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2,000-3,000 litres of water every week day. Together with the use of waterefficient fittings and rainwater harvesting, the building has successfully reduced its water consumption by an amount that is equivalent to the use of 12 households.

Unlike traditional office buildings which often consume a lot of energy to ventilate the basement car park, the Diamond Building basement car park features a sunken courtyard that helps promote natural ventilation. Energyefficient equipment and motors are installed in the car park, as well as carbon monoxide (CO) sensors, which only activates the ventilation system when CO exceeds certain limits.

The atrium, designed to optimise daylight utilisation, allows daylight in even to the lowest levels of the building

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Hope triumphs in Minamata “Industrial tragedy capital” now “eco capital of Japan” Citizens and government cooperate on systematic and cost-effective measures

Minamata City, in the Kumamoto Prefecture, overcame the horrific history of mercury poisoning that its people suffered and reinvented itself as a model environmental city

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Minamata City is a triumph of hope over tragedy. In 1956, the farming and fishing community of 50,000 on the island of Kyushu, the southernmost of Japan’s four major islands, was hit by a mysterious epidemic that caused numbness, muscle weakness, and sight, hearing and speech problems.

In extreme cases, there was paralysis, insanity and death. Birds fell from the sky, and cats danced madly and died. Deformed children were born to mothers seemingly unaffected by the epidemic. Unbeknownst then was that, while most chemicals do not cross the placenta barrier, methylmercury – the toxin later found to be the cause of the epidemic in Minamata – behaves in the exact opposite manner: it gets drawn from the mother’s bloodstream by the placenta and concentrates in the foetus.

Investigation into the cause of the tragedy took years before Chisso Corporation was identified as the culprit: the wastewater it discharged into Minamata Bay and Shiranui Sea

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By Ann Teoh

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Amazingly, all these green features combine to create an energy savings of almost RM1 million every year in the building’s operational cost. Reimann says: “The green cost of the Diamond Building is only about 6% (including PV) with a payback period of about 3.5 years. There is a common perception that going green is expensive, but the real fact is that not going green can be even more expensive. It just makes perfect economic sense to go green.”

Municipal waste is sorted into 22 categories for recycling and disposal

was poisoning the waters and its fish with methylmercury. Chisso’s refusal to cooperate – and, it is said, the power of vested interests – allowed the factory operate for over a decade after the discovery of the syndrome, prolonging the sufferings of the people. Such were the dark days of Minamata. Now, those who were born with congenital problems are in their 40s and 50s, and their health is deteriorating.

Despite this, the people of Minamata never let themselves be cowed. In 1992, Minamata proclaimed its desire to become a model environmental city in Japan and started off by obtaining ISO14001 certification, the core set of standards used by many organisations to design and implement effective environmental management systems. When the National Eco-City Contest Network started an annual contest in 2001 to encourage the development of sustainable local communities, Minamata became a regular participant.

Fast forward a decade to March 2011, when Minamata was honoured as the first Eco-City Capital of Japan – an award that allows it to stand proud after over half a century of being associated with one of the worst effects of industrial pollution. Although the contest names eco-cities annually, this was the first year that an Eco-City Capital was named. The prize-giving ceremony

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was held in May and witnessed by some 100 people who took time off from work to celebrate.

Minatama Eco-model City Promotion Division official Shinya Osaki says: “Winning the Eco-City Capital prize greatly helped restore the honour of Minamata City, long known as the city of environmental pollution. It is certainly a great honour for us to have the title of the Eco-City Capital. However, this was not the goal of our participation.

“Minamata City participated in the contest because its basic concept was an excellent match with the city’s vision of where we are heading. We have participated every year from the outset because we wanted our efforts toward environmental protection evaluated objectively by a third party as a reference for further improvement. We could compete and improve continuously through exchanging information and working with other participating municipalities and citizen groups.

“What we gained from the contest was a greater synergy between citizens and the local government, and higher levels of environmental effort. This was achieved as a result of the contest’s objective evaluations, which worked for us as a driving force to improve.

“From now on, Minamata is going to draw more attention as the Eco-City Capital of Japan. So, our city needs to take a leadership role in Japan by promoting further environmental efforts and acting as a role model for other cities nationwide by transmitting information from Minamata. We’d like to carry out environmental activities on a wider scale in cooperation with NGOs and municipalities across Japan.

Our goal is to create a sustainable and affluent community in the true sense, where people live comfortably in coexistence with the environment and all living things. We will continue our efforts toward this as our goal.”

Today, Minamata is on its way to achieving its target of cutting carbon dioxide emissions by 32.7% (against 2005 levels) by 2020, and by over 50% by 2050.

Minamata City mayor Katsuaki Miyamoto says its citizens and city government have been working hand-in-hand to promote various programmes in four categories: to

Minamata City mayor Katsuaki Miyamoto (right) receives the Eco-City Capital Award in May from Ikuo Sugimoto, chairman of the National Eco-City Contest Network

“Minamata’s goal was to create a sustainable and affluent society in the true sense.” promote an eco-conscious lifestyle, develop industries that are committed to the protection of environment, ensure urban development that is in harmony with nature, and develop urban environmental education.

The eco-conscious regime promotes a rigorous programme in waste reduction, separation and recycling.

Waste is sorted into 22 categories by the people themselves. Some 300 collection and recycling stations have been set up throughout the city to facilitate disposal.

After acquiring ISO 14001 certification in 1992, Minamata developed a simplified version of its environmental management system for household and school use. This was a guided approach to promote energy and resource savings. The city also certifies “eco-shops” that take environmentallyfriendly measures such as eliminating polystyrene packaging, and “environmental champions” – people who create eco-friendly and/or health-conscious products.

To ensure urban development that is in harmony with nature, Minamata, which is still surrounded by mountains

and rolling hills on three sides, promotes the planting and management of forests to preserve an effective carbon sink. It is working to facilitate the growth of seaweed to restore marine areas once polluted by methylmercury.

Minamata City is also involved in the production of alternative fuels such as bio-ethanol from unused local resources such as bamboo. This is one of the ways the city supports and develops industries that are environmentally friendly.

The city of Minamata was able to rise from the devastation of the Minamata “disease” only because its citizens and municipal government have been committed to turning a negative heritage into a positive one. The people and the government continually engage each other on how best to promote their efforts at the minimum cost for maximum results, says mayor Miyamoto.

Osaki says: “Looking back on our path since we started to work on environmental measures, I have to say we share this great honour with the people of Minamata; we’ve had fun and feel grateful to everyone. At the same time, we feel the pressure of our responsibility and mission for the future as Japan’s eco-capital.”

Today, Minamata has a population of 29,000. Seventy-five percent of the 162 sq km of land is forested.

(Source: Japan for Sustainability)    •   

case studies

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Geothermal giant greens the earth in more ways than one EDC’s fields double as ecotourism sites and wildlife sanctuaries WWF collaboration to propel model sustainable plant in Mindanao

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By G Danapal

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The 232.5 MW Malitbog power plant (above), which is the world’s largest geothermal power plant under one roof, supplies power to the Luzon grid.

In 2009, EDC took over the Palinpinon plant in Valencia, Negros Oriental, Philippines (below)

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The Philippines’ “geothermal Titans” – the Leyte Geothermal Production Field (LGPF) and the Bacon-Manito Geothermal Production Field (BGPF) in Bicol – are more than just geothermal steam generators. They are also unique forest-based geothermal ecotourism havens where the marvels of technology used to harness the “power of Earth’s buried heat” seems to blend seamlessly with the beauty of nature.

Energy Development Corporation (EDC), a pioneer in the geothermal energy industry that owns both production fields says by turning the geothermal fields into geothermal ecotourism havens, an avenue was opened for nature-lovers and adventure seekers to commune with nature.

The LGPF’s draw is the Tongonan Hot Springs National Park. The park is peppered with volcanic craters, warm medicinal pools, a geyser and numerous hot springs. It also hosts the country’s first geothermal power

plant, the 112.5-MW Tongonan Geothermal Power Plant, which is one of five geothermal plants in LGPF. The 107,625-ha LGPF, the largest wet steam-producing geothermal field in the world, has a total plant capacity of 708 MW.

The BGPF in Sorsogon, on the other hand, is a budding geothermal ecotourism destination with a wildlife sanctuary and a butterfly garden as the main attractions. It is also home to the world’s largest fruit bat, the endangered giant golden-crowned flying fox (Acerodon jubatus). The BGPF hosts the 150-MW Bacon-Manito (BacMan) geothermal power facilities.

EDC, a Lopez Group-led consortium involved in the production of geothermal steam and generation of electricity, operates, in all, 12 geothermal steam fields in Luzon, Negros Oriental, Mindanao and Leyte. In developing the geothermal ecotourism potential of these sites, EDC is guided by criteria set by the Department of Tourism and the University of the Philippines College of Forestry and Natural Resources.

Under a landmark ten-year greening programme – “Binhi: A Greening Legacy” – EDC president and CEO Paul A Aquino says the company is committed to spending 405 million pesos (US$9.3 million) on reforestation and biodiversity restoration projects.

To date, the company has planted 7.4 million trees in about 9,500 hectares of denuded forests around five of the company’s geothermal project areas, apart from protecting existing natural forests since the early 1980s.

The EDC initiative, which seeks to advocate a balance of nature and technology, preserve biodiversity, generate livelihood, and empower local communities, has also been recognised

by WWF-Philippines.

In March 2011, the WWF and EDC forged a deal to help increase Asia’s geothermal capacity by 150% by 2015 and 300% by 2020, as well as to replicate the Philippines’ success in sustainable geothermal production for Indonesia’s untapped geothermal energy resources via WWF’s landmark “Ring of Fire” project.

Under the deal, EDC is required to establish a Gold Standard Geothermal Showcase project – the 50-MW Mindanao 3 geothermal project in North Cotabato – as a benchmark to demonstrate the economic, social and environmental benefits of geothermal energy and broaden stakeholder support for accelerated geothermal development in the region. WWF-



Philippines president Jose Ma Lorenzo Tan notes that large geothermal developments also lead to substantial green investments and enable access to carbon markets.

EDC, formerly under the Philippines National Oil Company, was privatised in 2007. Founded in 1976 to undertake the exploration and development of geothermal energy sources in the country, the company is now the country’s largest integrated geothermal company and its leading producer of geothermal energy, accounting for 62% or 1,199 MW of the 1,980 MW total installed capacity.

In the last two years, EDC has been boosting its portfolio of power generation assets by taking over several of National Power Corp’s (NPC) geothermal power plants and contracts auctioned off by state-run Power Sector Assets and Liabilities Management Corp (PSALM), which has been mandated to manage the privatisation of the state’s power assets and take on the liabilities of the NPC. EDC, an active participant in the privatisation, has to date taken over the 192.5-MW Palinpinon geothermal power plant in Valencia, Negros Oriental; the Unified Leyte plants consisting of the 125-MW Upper Mahiao, 232.5-MW Malitbog, 180-MW Mahanagdong and 51MW Optimisation plants; the 106MW Mindanao 1 and 2 plants in

Partners in the landmark “Ring of Fire” project for accelerated geothermal development in Asia (left to right): EDC president & COO Richard Tantoco, WWF-Philippines president Jose Ma Lorenzo Tan, EDC senior vice-president for Environment & External Relations Agnes de Jesus and WWF-Philippines chairman Vince Perez

Kidapawan, Cotabato; and the 49-MW Northern Negros geothermal plant in Negros Occidental, in addition to the Tongonan and the BacMan plants.

In May 2011, EDC signed a 15year loan facility for US$75 million with International Finance Corp, the private sector investment arm of the World Bank Group, to help fund its planned greenfield geothermal power projects as well as the expansion and

rehabilitation of old geothermal plants, expected to cost EDC some US$50 million.

Overall, the company is expected to invest some US$1 billion over the next five years to increase its attributable generating capacity by 38% to 1,542 MW from the current 1,116 MW. This would propel EDC to become the top geothermal company in the world, overtaking Chevron.

Going for colossal expansion with plans to reach 2,550 MW of geothermal installed capacity in the next four years, the Philippines government set the ball rolling in mid-2010 when it issued a call to both local and foreign geothermal energy developers to bid contracts for 19 new geothermal power plants, amounting to a total of US$2.5 billion in private investment. The expansion of geothermal energy capacity at these 19 sites is estimated to total 620 MW of geothermal energy.

The Philippine National Oil Company (PNOC) is also back in the geothermal energy business after being awarded an exploration contract by the Department of Energy in February, 2010, to develop the Mount Isarog volcanic chain in Camarines Sur. The US$60-million Mt Isarog geothermal

   

Philippines goes underground in a colossal way for energy

Steam pipes carry steam at a temperature of 300ºC from 3km beneath the earth’s surface to generators at the Bacon-Manito geothermal power plant in Albay

project, with capacity of up to 70 MW, will be connected to the Luzon grid.

To accelerate the exploration and development of geothermal resources, the

Philippines government is also being urged to provide attractive incentives to “green investors” in accordance with the Renewable Energy Act 2008. In calling for the imposition of feed-in tariff rates, National Renewable Energy Board (NREB) chairman Pedro Maniego Jr Maniego said the implementation of the provisions of the Act has been delayed for years while other countries, including the Philippines’ Asian neighbours, have moved ahead in renewable energy investments, targets and support policies.

Trade and Industry Undersecretary and Board of Investments managing head Cristino Panlilio recently reiterated: “The country still has a vast potential of tapping geothermal energy since it has many volcanic areas. These projects are in line with our target of a geothermal capacity of at least 3,000 MW by 2030.”

   •   

case studies

ď˜–ď˜‰ď˜’ď˜‰ď˜›ď˜…ď˜†ď˜?ď˜‰ ď˜‰ď˜’ď˜‰ď˜–ď˜‹ď˜?

Last mile, second wind before Malaysia’s FiT launch Authorities talking to banks which have yet to show enthusiasm Quotas still being tweaked, awaiting confirmation from Energy Commission

Things are moving along for Malaysia’s upcoming feed-in tariff (FiT).

While it’s probably more rush than rest for those pushing it to the starting line, it is still a tad slow for those who have waited many months for its launch.

On the bright side, the Sustainable Energy Development Authority Malaysia (SEDA Malaysia), the statutory body tasked with ensuring the FiT’s success, ďŹ nally came into its own on September 1st, after months of operating as Interim-SEDA. The FiT scheme, initially scheduled to begin in September, will kick off only in December to allow the supporting laws to be readied. The 1% consumer electricity tariff hike to pay for renewable energy (RE) will start in tandem with the FiT scheme.

Push for funding The authorities are talking to banks to ensure that funding is available for those who want to be RE producers.

However, no bank has ofďŹ cially come on board although the 20 commercial and Islamic banks under the Credit Guarantee Corporation’s (CGC) purview (in the Green Technology Financing Scheme) are deemed to be participating, says SEDA Malaysia founding chief executive ofďŹ cer Badriyah Abdul Malek, who was also the Ministry of Energy, Green Technology and Water’s undersecretary for energy.

Badriyah says SEDA Malaysia has had discussions with the central bank, Bank Negara Malaysia (BNM), and wants to have further discussions with it and the Malaysian Green Technology Corporation (MGTC). “We are looking at 80%-20% debt ďŹ nancing. For solar farms, you need RM100 million, and so the RM50 million cap in MGTC’s Green Technology Financing Scheme is not good enough for us. We need to talk some ď żďĄ€ ď˜‹ď˜–ď˜‰ď˜‰ď˜’ ď˜”ď˜™ď˜–ď˜‡ď˜Œď˜…ď˜—ď˜?ď˜’ď˜‹ ď˜…ď˜—ď˜?ď˜… • ď˜“ď˜‡ď˜˜ď˜“ď˜†ď˜‰ď˜– ď žď źď ˝ď ˝

ď˜‹ď˜”ď˜… ď˜”ď˜Œď˜“ď˜˜ď˜“

By Ann Teoh

Founding CEO of SEDA Malaysia Badriyah Abdul Malek says the cap in the Green Tech Financing Scheme is too low for RE projects

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A special report on the FiT was commissioned by SEDA Malaysia for distribution at IGEM 2011 in Kuala Lumpur last month. It was based on a cover report by Green Purchasing Asia

more with BNM and the banks on how this can be mitigated.�

Minister of Energy, Green Technology and Water Datuk Seri Peter Chin, who had called the press conference to introduce the SEDA board and Badriyah, says banks cannot use normal banking considerations when evaluating RE projects.“You need to be more creative to make it bankable.

We need BNM to step in, like when it says ‘I want you [banks] to do lowcost housing.’ We have to have a bit of direction.�

He also learnt from Indian New and Renewable Energy Minister Dr Farooq Abdullah that India has a bank for RE alone. “This is a new paradigm. We will introduce this idea to the government.�

Quotas and displaced costs In the meantime, adjustments have been made to the 2011–2014 RE quotas, reecting displaced costs that have gone down slightly. The displaced cost, which uctuates, is the average cost of generating electricity from non-RE sources. The lower the displaced cost, the greater the difference between the FiT (which is ďŹ xed) and the displaced cost – and consequently, the more money that must raised via electricity tariffs to fund RE. All things being equal, the alternative to increasing electricity tariffs is to reduce RE quotas.

Asked why the displaced costs have dropped, Badriyah says the numbers are the latest obtained from Tenaga Nasional Berhad, Malaysia’s power utility company. “It is 19 sen [from 20.47 sen] for medium voltage and 26 sen [from 31 sen] for low voltage, but the ďŹ gures have yet to be veriďŹ ed by the Energy Commission, the authority that deals with all energy matters.â€?

Thus, both the quotas and displaced costs published on the SEDA Malaysia website are still tentative, although they are unlikely to be far from the ďŹ nal ďŹ gures. The ďŹ gures will be ďŹ nalised before December 1st.

Badriyah says RE quotas are adjusted every six months to ensure that unused quotas are not wasted. Unused quotas will be re-allocated to the four sectors that are eligible for FiT, i.e., biomass, biogas, solar and mini hydro.

FiT degression will start in 2013 as there is only a month left to 2011 when the FiT is launched. Degression refers to the lowering of the FiT for new power generators.

SEDA Malaysia chairman Tan Sri Dr Fong Chan Onn says one of the functions of SEDA Malaysia is to inculcate and popularise the idea of RE among Malaysians, and to inculcate the ideas of sustainability and energy efďŹ ciency as social values so that they become part of Malaysian culture and lifestyle.

case studies

 

Here comes the sun: Benefiting is believing FiT will provoke consumers to think about carbon emission reduction via solar energy RM70 bil can be generated by renewable energy power plants, with taxes amounting to RM1.75 bil

The Malaysian feed-in tariff (FiT), which is scheduled to come into force on December 1st, will guarantee income for producers of renewable energy for a period of up to 21 years for those who meet requirements and are allocated the quotas.

The tariffs, analysts say, will determine whether investors will eventually venture into generating renewable energies as independent power producers and help the country comply with its Copenhagen commitment to cut carbon emissions to 40% of 2005 levels by 2020.

Schneider Electric has conducted some preliminary studies based on a 15-panel solar photovoltaic (PV) installation on the roof of its manufacturing plant in Shah Alam in the state of Selangor. Producing 330 kilowatt-peak units (kWp), the system can create a continuous income stream of between RM450 (US$147) and RM500 per month, given that the FiT is RM1.49 per kWh (RM1.23 plus RM0.26 bonus for installation on building structures). In a year, it works out to be about RM6,000, based on an average energy yield of 12 kWh per day. The studies also showed that the payback period for the installation is estimated to be less than ten years; thereafter, the

Date

 

Daily energy yield

Weekly energy yield Monthly energy yield Yearly energy yield

30th Aug 2011 31st Aug 2011 1st Sept 2011 2nd Sept 2011 3rd Sept 2011 4th Sept 2011 5th Sept 2011 30th Aug – 5th Sept 2011 July 2011 Aug 2011 Jan – Dec 2011

 

By Stephen Ng

Schneider Electric’s Malaysian country president Peter Cave

PV installation becomes a cash cow.

Even as it sells solar power at this price to the grid, the power producer itself consumes electricity from the grid at a much lower price; the current industrial tariff is only 34.5 sen per kWh for those using less than 200 kWh. This is the optimism shared by many PV suppliers who are flocking to the Malaysian market: that power Schneider Electric expected solar PV energy yield • Installed peak array power: 3.3kWp • Array size (parallel x series): 5 x 3 unit • Module power/pcs:

220Wp

• Possible FiT rates/kWh:

RM1.49

Calculation Calculated Calculated energy yield FiT income (kWh) (RM) 11.0 16.4 11.0 16.4 11.0 16.4 11.0 16.4 11.0 16.4 11.0 16.4 11.0 16.4

Actual site data Energy Expected yield FiT income (kWh) (RM) 12 17.9 7.5 11.2 14.9 22.2 15.1 22.5 13.1 19.5 13.3 19.8 14 20.9

76.9

114.6

89.9

134.0

317.1 321.8

472.4 479.5

333.6 311.1

497.1 463.5

3,699.5

5,512.2

N/A

N/A

consumers, including residential homes, will turn independent power producers come December 1st with the commencement of the FiT. Schneider Electric’s Malaysian country president Peter Cave says: “[This] also opens up the minds of consumers and provokes them to think about how they can contribute to carbon emission reduction via the use of solar energy and at the same time make money from being green.”

Electricity in Malaysia is still largely generated from fossil fuels.

Coal, oil and natural gas account for around 85% of total electricity generation in the country, while renewable resources make up only around 1%. Power demand in Malaysia is expected to rise 5% annually from 2011 to 2015. With the recent electricity tariff hike by the government, electricity bills are expected to rise, which can turn into an unnecessary burden for businesses.

During the disruption in gas supply due to maintenance shutdown of gas production platforms owned by state oil company Petronas in May this year, Malaysia had to purchase electricity from Singapore for an entire month. The deal between Malaysian company YTL Power’s PowerSeraya, located in Singapore, and Malaysia’s Tenaga Nasional Berhad was the first commercial deal for the export of electricity between the two countries.

Cave says solar power not only reduces carbon emissions, but also contributes to the GDP of the country.

“It is expected that a minimum of RM70 billion can be generated from the operation of renewable energy power plants, which leads to a tax income of RM1.75 billion for the government.” He adds that some 52,000 green collar jobs will be created to construct, operate and maintain these plants.

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people

Econation building, one home at a time Managing director of Panasonic Malaysia Jeff Lee recently invited Stephen Ng for a preview of how Panasonic Malaysia – a market leader in home appliances in Malaysia – plans to engage businesses and government with its ambitious Econation programme

According to industry research group GfK, Panasonic – especially because of its EcoNavi technology – is the leading supplier of eco-friendly airconditioners, washing machines and refrigerators. Tell us more about Econation, especially on your engagement with businesses (B2B) and government (B2G) going forward.

Panasonic turns 100 years old in 2018 and the company’s global vision is to become the No 1 green innovation company in the industry by 2018. I am 55 now, and by then, I would have retired. Econation is basically our local aspiration to take the lead in the green revolution and become a green company by 2015. There are several stages of implementation every year from 2011 through 2014.

The company has over 90 categories of products in its range, which can fall into four broad quadrants – fulfillment, competitive, creative and collaborative. Our bread and butter comes mainly from the first two quadrants, where my operations people are capable enough to focus on fulfillment market-based products such as the rice cooker and flat display televisions, where competition is intense.

As the managing director, I am involved in the creative and collaborative aspects of business development. This is where I am     •  

 

Japan’s electronics giant Panasonic has launched an ambitious programme called Econation for its Malaysian market, building on a green platform created in recent years to reflect the company’s focus on total energy solutions as a growth driver.

Jeff Lee Wee Leong, a true blue Panasonic man who has devoted 28 years to the company, is the current managing director and the tenth since the company started in 1976. He speaks about “green” as a business opportunity in a blue ocean strategy for his company.

Panasonic Malaysia managing director Jeff Lee acknowledges: “Yes, Green will be the new norm.

And Panasonic Malaysia has to take the lead, now or never!”

Envisioning the Econation Panasonic introduced the Econation concept to encapsulate the goals of its partnership with Malaysia on the latter’s journey to becoming a developed nation that is also environmentally sustainable. As a global leader in green technology and in line with the belief that “a company is a public entity of society”, the company aims to provide Malaysians with total energy solutions that facilitate sustainable living and support a more promising future.

Panasonic joined the ranks of other global green technology leaders with its late-2009 acquisition of Sanyo Electric, a onetime rival known for its dominance in the rechargeable lithium-ion battery market, as well as for its HIT (heterojunction with intrinsic thin layer) solar cell technology.

The company is also collaborating with Tesla Motors on electric vehicle (EV) technology. The Tesla Roadster, an EV which runs on a Panasonic lithium-ion battery, was a major crowd puller at the recent IGEM 2011 exhibition in Kuala Lumpur.

personally driving the Econation initiative, where we will engage and create total energy solutions to facilitate both business and industry players, as well as the policymakers in this country.

Once our state-of-the art RM2.5 million Econation Centre, located at Section 16, Petaling Jaya, is completed, it will showcase Panasonic’s total energy solutions to help drive the nation’s many green initiatives and help reduce CO² emissions by up to 40% by 2020, compared to levels in 2005.

You have set a target of RM2 billion in sales in Malaysia by March next year. Eco-products were already contributing to RM650 million out of your RM1.9 billion turnover last year.

How much do you expect the ecoproducts to contribute to your target?

Where will the new sales come from?

What has changed that will enable you to set such a large target?

When I first joined the company in 1976, the business was RM46 million.

PanaHome can be assembled on-site within a day! In Japan, these homes can withstand up to 8.0 on the Richter scale. Our sister company in Japan has started some groundwork in Malaysia.

Tell us about the new products that will come on stream soon, like heterojunction with intrinsic thin layer (HIT) solar panels. Are they being introduced following Malaysia’s decision for the feed-in tariff (FiT) mechanism to start in December?

We have recently won a turnkey project to install HIT solar panels in Iskandar Malaysia. With this first project, we will move more aggressively into other new housing projects. In fact, we see a big business opportunity in the photovoltaic (PV) sector.

We are not the only ones who are optimistic. The Malaysia Building Integrated Photovoltaic (MBIPV) project reported that there will be substantial growth in the PV industry in Malaysia. We already know the FiT and we are waiting for the setting up of the Sustainable Energy Development Authority (SEDA) Malaysia. There is no question about viability. Investors are waiting. We are also waiting.

[SEDA Malaysia was set up on September 1st after this interview. – Editor] Do you think green solutions will be the new norm?

The future is green. People are becoming more eco-conscious and talking about renewable energy sources. At Panasonic, our total energy solutions business would be the new growth driver, with our focus on producing, storing, saving and managing energy

as part of the green revolution. We build our business on Green Life Innovation, wherein we promote green lifestyles for the average person and his household. Next is Green Business Innovation, which creates total energy solutions to facilitate Malaysian B2B and B2G industry players in using resources and energy in the most efficient manner.

Greentech being tested in Singapore eco-town



You have mentioned total energy solutions a number of times. What are the elements that make up this new approach? Are you going into the building of eco homes, perhaps as developer or as partners for developers?

Instead of a piecemeal approach, we see ourselves as provider of a total package. I have met with a number of housing developers of green townships, who told me: “Jeff, we are good at landscapes, but we know we can now tap into Panasonic’s expertise in providing a wide range of eco-products for the home.”

Through collaborative work with these developers, we at Panasonic Malaysia can see where our new businesses will be coming from.

We have a construction company as well, to build PanaHomes. By using prefabricated building materials, a

A concept visualisation of the Econation Centre in the Malaysian urban centre of Petaling Jaya



In the financial year ended March 2011, we hit a record in sales of RM1.9 billion despite the economic slowdown in Malaysia. Among all the Panasonic sales companies throughout the world, Malaysia has moved to the eighth position from its previous eighteenth position. For a population of 27 million, this is a big achievement, but is it sustainable? With emerging markets such as the BRIC markets (Brazil, Russia, India and China) and Vietnam, where the population is many times more than Malaysia, we may slip to 18th place if we do not do something about it.

However, as managing director, I see myself as a merchant of hope.

Scanning across history from coal to petroleum, and now to renewable energy, we see new trends, businesses and growth opportunities emerging as a result of each shift. For example, when petroleum replaced coal, we saw the emergence of new derivative products such as plastics. Our Econation concept is to tap into the green revolution. At this juncture, we are already very close to reaching our target sales turnover of RM2 billion

by March 2012. However, with our new eco-products, we hope to make another half a billion ringgit in sales in a few months. We will be launching a new range of our EcoNavi products in the next six months.

In Singapore, the Housing and Development Board (HDB), Energy Market Authority and Economic Development Board are working with Panasonic to test and develop an integrated energy system in Punggol Eco-Town, a relatively young HDB township designed to be a test-bed for new technologies in sustainable development.

Ten apartments here have been selected to model the system, which will help families reduce their carbon footprint and utilities bill. Solar panels will be installed to power lifts and lights. Excess electricity will be stored in batteries for night use. Airconditioners in the test homes will also be upgraded to more energy-efficient inverter models. The project will run from 2011 to 2013.

(Sources: ChannelNewsAsia, HDB, Green Building Elements)

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people

Living and building green is affordable

“My main mission is basically to unlock the green purchasing power of consumers. Unless this happens, there will be no breakthroughs in green technology. Instead, we are finding it hard to drive the green initiatives because of public perception that ‘green is expensive’ and the fact that there are businesses who would make every attempt to kill off a green innovation before it can even be commercialised,” says Matthias Gelber, who has made Malaysia his second home since 2004.

Living green is, in fact, inexpensive, he argues. Comparing his electricty bill with those of other households in Malaysia, Gelber’s is only in the region of RM20 to RM30 a month – or a third of what a bachelor would pay living in an upmarket condominium in the posh neighbourhood of Bangsar.

Getting around in Kuala Lumpur is not as difficult as what some people have made it out to be, and Gelber says he hardly needs a car. Taking public transport in Kuala Lumpur is in fact a lot cheaper, and if he has to use a taxi, he chooses one that consumes natural gas to reduce his carbon footprint. Admittedly, not many people can live like him, but Gelber says: “If I can still live a comfortable life being green, and if more people can become like me, together we can make a difference. Until that happens, we will not be able to create a market force that will change the current economic landscape.”

One thing grieves him. “Most people are willing to contribute to a green event, and that’s about it!

There is generally a lack of belief in the value system that we are talking about. What we need is a commitment to do the right thing for the sake of our endangered planet… and for the sake of our future generations.

“What most people fail to     •  

 

German-born 43-year-old Matthias Gelber was voted the “Greenest Man on the Planet” in 2008 for one main reason: His passion to live out his life’s mission and business ventures by being as green as possible. The title given by a Canadian outfit has become his calling card. He tells Stephen Ng how he is using this claim to fame as a platform to spread the message of sustainability

Gelber says builders need to look at overall cost, instead of just the material cost

“My mission is basically to unlock the green purchasing power of consumers.” consider is the cost of cleaning up the environment. Once this is factored in, you will realise that it is, in fact, more expensive to buy non-green products.

Our current economic framework encourages wastage. Pollute, pollute, pollute and let someone else take care of the cleaning up.”

Citing the example of Vista Bay How Vista Bay apartments cut cost with G-blocks Item Material Lay Mortar Plaster Internal plaster Exmet Total cost

G-blocks (RM) 2.70 0.60 0.25 0.90 1.10

Cement bricks (RM) 2.10 0.70 0.40 1.30 1.40

0.05 5.50

0.15 6.05

Apartments in Butterworth, which uses lightweight insulation G-blocks for external and internal walls, Gelber adds: “It not only helped to reduce the weight of the building, hence reducing the steel bars and the foundation required to hold the weight of the entire building, but the developer was able to save as much as US$200,000 (RM700,000). The lightweight bricks provided good insulation, reducing the need for air-conditioning, and the bricks made good noise barriers, making the apartment so much more liveable.”

Although the material cost may go up as a result of using G-blocks instead of cement bricks, Gelber points out that the price is offset by having to spend less on mortar and plaster, as well as the bricklaying (see table). “If builders are serious about going green, they should look at the overall cost incurred, instead of just comparing the material cost,” he explains.

“Otherwise, we will never have a shift in the paradigm and be a market force to be reckoned with.”

There is definitely money to be made in green business but a lot of groundwork has to be done now to tap the business potential in the business-to-business and business-togovernment procurement.

Gelber, who co-founded Maleki GMBH, a company in his hometown of Lippe, says his company sells a few million euros worth of products every year in the European Union countries that have mandated businesses to go green.

Gelber also believes that there are efforts to kill green businesses.

“It is a difficult industry to bring new innovations into the market,” he admits. “Some green and innovative solutions have never been commercialised because of the lack of support from investors and the market.”

Briomedia Green Sdn Bhd (924679-H) 3-3 Jalan Solaris 2, Solaris Mont Kiara, 50480 Kuala Lumpur, Malaysia • Tel: +603 6203 7681 (Malaysia) • Tel: +65 9068 0184 (Singapore) • Fax: +603 6211 2681 • Email: editor@greenpurchasingasia.com • Marketing & sales Yong Wang Ching (Malaysia) +6012 205 7928, Lim Wan Tsau (Singapore) +65 9068 0184 • Subscription & circulation Yap Eng Jin

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people

The power of procurement As head of Planet McCann, McCann-Erickson’s global community for best communications practices on sustainability, Mike Longhurst has worked extensively with various international organisations on their green initiatives. In this phone interview with Siaw Mei Li, he shares the company’s approach on responsible green marketing and argues the case for procurement as a driver for sustainability.

On corporate sustainability trends From a European perspective or from the position of global companies, procurement is driving sustainability progress – probably more than anything else. People who once thought consumer demand was going to pull sustainability through are completely wrong.

Although consumers say they want to buy more sustainable goods from more sustainable companies, they demonstrate no ability to recognise which are more or less sustainable. Research says consumers just associate sustainability with the biggest names they know. If a brand has a high profile, it will appear to have a high profile for sustainability.

That’s the frustrating thing.

Where we see sustainability making the most progress is through the pressure that corporations put on each other. In the UK, and to a lesser extent in Europe and in the US as well, the middlemen – the retailers – are putting huge demands on their suppliers.

Walmart was one of the world’s most hated companies, but changed their attitude about five years ago.     •  

• Grew up in Singapore, Egypt and Cyprus as his father was in the British Royal Air Force • Has previously worked in Germany and Kenya • Speaks “reasonable” German and “schoolboy French” • Except for a short period as a client, Longhurst has “always been an agency man – never done a real job in my life!”

• An avid photographer and member of the Royal Photographic Society, he coaches other photography enthusiasts and has published some of his collections online.  

Mike Longhurst, senior vice president at McCann-Erickson (Europe, Middle East and Africa) has had a long, wide-ranging career with the international marketing communications agency, but he may be best known in the advertising community for leading Planet McCann, the network’s centre of expertise on sustainability brand-building.

Tapping on his experience in the United Nations Environment Programme (UNEP) Advertising Advisory Committee and as an executive board member of the European Association of Communication Agencies (EACA), Longhurst shares his perspectives.

“Procurement is driving sustainability progress – probably more than anything else. People who once thought consumer demand was going to pull sustainability through are completely wrong.”

They probably got the sustainability message earlier than many others in the US. Their sustainability programme probably did a lot to change US government policy, because once they’d done that, the legitimacy of the Bush government’s stance against things like the energy policy was blown away. If Walmart could stand up and say “we believe in this”, that probably was the tipping point in the US. In the UK, Marks & Spencer’s “Plan A” campaign and corporate platform is not just about saving energy and working more efficiently; it’s about them exerting huge pressure on suppliers, and then giving

leadership to consumers. It won’t work without both ends of the chain, so procurement – certainly through retailers – has been very important.

Now we’re also seeing sustainability emphasised by government procurement. It’s going to become impossible to deal with major governments in the world unless you go through a fine procurement filter which checks out your sustainability.

Because procurement policies are getting tougher, companies are being forced to develop more sustainable products and to project that image to their customers, the big corporations, the retailers, the B2B targets. Some companies already have products which are sustainable but a reputation that’s the opposite, and they approach agencies to help them work on their sustainability reputation with regard to B2B and influencers, even if not with consumers.

On Planet McCann and how it works McCann was involved with the UNEP and industry leadership programmes since a dozen years ago or so, while most of the other agencies came

[into sustainability branding] around 2007 when they saw more money being spent in that area, and formed specialist agencies to deal with that.

By then, we had decided we didn’t need to form specialist agencies because the issue became mainstream.

Our clients don’t want to be told that to do anything on sustainability, they’d have to talk to our small specialist units. What they want is to be able to talk to their our account people. The extra expertise that’s needed comes from Planet McCann; if they need help, advice, or anything, they come through me and I either provide it myself or put them in touch with others in 40 different countries who can help.

Planet McCann set out to be mostly an internal resource. It’s not a profit centre but exists to serve all of our profit centres and clients. The only direct client it has ever had has been the UNEP, where we produced advertising for them, but otherwise our clients are our own agencies. We have a global online system – a “neural network” – that helps pull people with relevant interest areas into special work groups. These groups form as they’re needed, and Planet McCann is one of them, with no overheads, no cost. Sometimes clients don’t even know that we’ve been involved, and that’s fine.

On working for the UNEP I worked closely with the UNEP from 1999 through to about 2006 and we ran their industrial liaison session with them recently in Paris as part of the build-up to the world summit next year.

The essential campaign we’ve produced for them, in cooperation with the International Association of Public Transport (UiTP) in Brussels, was on why people should use public transport to help the environment. Both the 2005 and 2008 campaigns became the world’s most extensive advertising campaigns, probably in more countries than any other campaign, because they were created on a royalty-free basis.

The 2005 one was probably the world’s first international free-to-air TV commercial. The one we did in 2008 ran on 20,000 screens in Beijing during the Olympic games, in all their tube cars, trolley buses and things like that.

The public transport ad that travelled the globe “The voice of reason (Aged 6)” television commercial was produced for the UNEP and International Association of Public Transport (UiTP) to encourage individuals to take public transport, thereby reducing the carbon emissions that contribute to climate change.

It was rendered in the style of a child’s drawing, and signs off reminding viewers: “The world is your home.

Look after it.” The ad has run on major international stations and in conjunction with the 2008 World View the English version of this ad at Environment Day. www.youtube.com/watch?v=OE3lFfUYf-E

How one good ad multiplies its own positive impact The best sorts of things start to happen when people accept the higher-level logic of what’s going wrong in the world and why it should be put right.

The public transport ad we produced was simply offering a solution. The world, the environment, has got problems, and public transport is part of the solution – use more public transport.

That was targeted not just at consumers but also at governments to make them more aware of the need to fund public transport and promote it. It was aimed at public transport operators themselves to make them aware of this sustainability platform on which to promote themselves to consumers; many were locked into thinking only along price and routes.

The ad was a catalytic thing. It was flexible and translatable into about 40 different languages – not by us, but the backing tracks and studio elements needed were given to whoever wanted to produce their own voice-overs and titling locally.

On greenwashing In a recent agreement with our parent body, we’ve added on an anti-greenwash role. We don’t force people to send things to us to approve but we can provide copy advice and help, which our agencies in Malaysia, Bangkok and Beijing have used.

They’ve sent me things asking: “Is this the right way of saying it, is it fair?”

And we give them counselling on that.

It’s totally voluntary but an important resource to have.

The trend in sustainability communication What we’ve seen over the last six to eight years is the gradual evening out of the balance of influence between corporate affairs people and productdriven marketing departments. The message has come down from the top that sustainability is a priority, empowering corporate affairs people to exert a much stronger sustainability focus on research & development, and on marketing. So in recent years, more and more marketing people have been drawn into supporting sustainability [instead of focussing primarily on product cost and functionality attributes].

Ultimately we’re going to see more and more product differentiation coming from sustainability aspects and those differences are going to have to be promoted through advertising.

That’s where the second coming of sustainability communications is going to rise from.

Read about Interbrands’ Best Global Green Brands 2011 report on page 55 to see how green branding and actual sustainability practices line up for the world’s top brands    •   

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Pathways of green collaboration Ministers and senior government representatives from seven countries met with Malaysian Prime Minister Datuk Seri Najib Tun Razak in a ministerial roundtable held for the first time at this year’s International Greentech & Eco Products Exhibition & Conference Malaysia (IGEM) in Kuala Lumpur on Sept 8th. An open dialogue with invited guests later, allowed an airing of opinions on why inter-governmental collaborations are crucial to the matter of saving the Earth.

Ngam Su May reports.

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Discussion theme: Pathway and roadmap towards a low-carbon economy – Realising development goals and tracking affirmative action

From left: Chin, Mohammad Yasmin, Farooq, Tahar and Razali

If there’s one voice that resonated at the roundtable, it came from India’s silver-haired Minister of New and Renewable Energy Dr Farooq Abdullah who says it is the duty of rich nations to help developing countries leapfrog into the era of green growth by providing the required technology at a cost they can afford.

At a recent seminar in Abu Dhabi, Farooq played on the same theme when he called on oil-rich countries like the United Arab Emirates to use their huge revenues from fossil fuels to buy green technology from the US or Europe and pass it to developing countries.

He says this is necessary to save mankind because we live in a globalised world. “If India dies, other parts of the world cannot survive. The time has come for the biggest polluters     •  

to pay the price of saving the world.

They have to wake up to the question of how to save our world. There is no other world.”

Farooq says it is only by bringing down the cost of renewable energy that developing countries can tap into it and grow economically. India, which depends heavily on fossil fuel imports for its energy needs, has invested billions of dollars in renewable energy, mainly in wind and solar.

He says the cost of one unit of solar energy was once Rs 18 (US$0.38). In less than a year, it has gone down to Rs 11, due to higher industrial production and mass utilisation of solar photovoltaics.

Underlining the value of collaboration, he says India is working with countries like Finland, Sweden, Norway, Germany, Spain and Iceland

Ministerial Roundtable participants: • India’s Minister of New and Renewable Energy Dr Farooq Abdullah • Chairman of the executive committee, Hydrocarbons Regulatory Authority, Algeria’s Ministry of Energy & Mines, Dr Tahar Cherif Zerarka • Energy Minister of Brunei Pehin Datuk Mohammad Yasmin Umar • Cambodia’s Senior Minister of Environment Dr Mok Mareth • Singapore’s High Commissioner to Malaysia Ong Keng Yong • Sri Lanka’s Ratnasiri Wickremanayake, Senior Minister for Good Governance & Infrastructure (he was represented by a senior official at the open dialogue).

Host: Datuk Seri Peter Chin Fah Kui, Malaysia’s Minister of Energy, Green Technology and Water Moderator: Tan Sri Razali Ismail, Malaysia’s former Permanent Representative to the United Nations

to help bring up the quality of life of ordinary folk.

For instance, Norway has helped to light up two villages in a remote part of India with solar energy. Before the collaboration, villagers had to walk miles to get water for their fields and children had little education because they could not see well with kerosene lamps. “Today, there is water in every house, computers in the home, water going to the fields,” he says.

On biofuels, India’s current production technology is at first generation. When he found that Finland had advanced to third generation alternative fuel, Farooq invited a Finnish company to share its technology with India. This was one way to leapfrog to state-of-the-art green technology. “We want them to jump with us,” he says, adding that the Finnish government

reacted enthusiastically.

Technological cooperation can take shape in other forms. Farooq cited the case of a training centre in a remote village in Rajasthan which teaches illiterate women from several developing countries how to assemble electronics and solar photovoltaic panels. These women go back to their villages to train others, thus spreading green know-how. (Note: Green Purchasing Asia ran a story on the Barefoot College in its June issue)

Solar station in Brunei On the issue of collaborative research in green technology, Brunei’s Mohammad Yasmin Umar says his country has a 1.2 MW solar station that can be used by other ASEAN countries for experimentation in solar PVs. Energy efficiency & hotel ratings Singapore’s Ong Keng Yong acknowledges that energy efficiency (EE) is the easiest path to go green.

He however cited an example of how commercial standards can block the reaping of this low-hanging fruit. Due to international hotel ratings, he said, a five-star hotel has to be bright and cheery upon entry, meaning the lights and air-conditioning are left on even when the guest is not in. Thinking and practicing EE, as such, has to go handin-hand.

While Singapore has been praised for its EE initiatives, Ong cautions that “one size does not fit all”. Being a city state, he says, it is easy to communicate EE messages and pass the cost to consumers.

International partnership for EE cooperation From the floor, Dr Amit Bando, executive director of the International Partnership for Energy Efficiency Cooperation (IPEEC) secretariat, introduced the audience to his organisation that champions energy efficiency. Founded in 2009, the IPEEC is a voluntary, ministerial-level forum of developed and developing countries that represents the major economies. It is tasked to look at EE issues, promote research and development (R&D) and facilitate the development of EE standards, intellectual property and financing.

Dr Farooq Abdullah

“There’s a saying in my state Kashmir that the day there is black snow is the end of the world.

For the first time in my life, I saw black snow; the pollution from the burning oil wells.”

Ong Keng Yong

“Everything attracts an opinion, one way or the other. But the advantage of Singapore is that over the last 50 years, we have put across a culture of balance.”

Dr Tahar Cherif Zerarka

“In future, we will not invest in power plants from natural gas.”

Renewable energy in Algeria Although Algeria is rich in natural gas and oil, Dr Tahar Cherif Zerarka discloses that the government has set an ambitious national target of 40% electricity production from green energy, especially solar, by 2020. Of 60 power plants in the country, he says seven will focus on electricity generation from renewables. “In future, we will not invest in power plants from natural gas,” he says.

Overdesigned chillers in Malaysia A member of the audience suggests that air-conditioning chillers in Malaysia be downsized, given the government’s decision to set temperatures at a minimum of 24˚C. He says there is no reason to overdesign chillers when smaller ones can do the job and are more energyefficient. Malaysia’s Peter Chin agrees to consult with technical experts on this suggestion.

Incentives for going green in Malaysia An executive from property developer Malaysian Resources Corporation Berhad (MRCB) laments the high cost of going green. He claims MRCB had to spend an additional RM50 million to get two office buildings certified green. As such, he asks the Malaysian government to consider lowering the import tax on building materials like low-E glass. He says studies state that the return on investment (ROI) for solar PV cells in buildings was a discouraging 30 years.

In response, Peter Chin says developers can apply for tax exemption on renovation costs for existing buildings that lead to green building certification. For new buildings, imported green materials also qualify for tax exemption.

Lalchand Gulabrai, technical director of ZED-G & P Sdn Bhd, commented on the 30-year ROI from the floor. He says this can be lowered if companies apply for investment tax allowance of 25% and take advantage of the feed-in tariff (FiT) mechanism which will be implemented in December. He adds that suppliers of green materials like double-glazed glass can apply for import duty and sales tax exemption.    •   

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Not so common sense for biomass projects Competing uses for wastes may require policy planning Biomass itself needs to be sustainable if converted to other goods that are certifiable

Khoo Hock Aun is vicechairman of the Roundtable on Sustainable Biofuels.

His email is khoohockaun@ cosmobiofuels.com

By Khoo Hock Aun

Biomass seems to be the buzzword these days, the focus of numerous green technology projects on turning waste to wealth. Oil palm has been identified as a key sector in recent policy initiatives.

However, there might not be sufficient understanding of the policy framework for this sector and this may result in simplistic assumptions on how industry needs to move forward.

Some financiers also lack experience and depth of understanding on the risks and returns associated with biomass projects.

Four key issues may be considered in developing viable projects or policies in this area: aggregation, supply curves, conversion technologies and competing demands for the final products.

Supply curves As by-products of harvesting and post-harvest processing, waste and residues were, in the past, a cost to farmers and processors of agricultural products. This is not so any more. Take the case of oil palm. There is increasing demand for empty fruit bunches and palm kernel shells. Companies that want these wastes as a resource now need to consider that higher prices     •  

Conversion technologies These range from simple composting to yield fertiliser and basic pelletizing to the production of densifed fuel sources for the bioenergy market. At the mid-level, palm oil mill effluent may be processed for methane and



Aggregation Malaysia is blessed with abundant biomass: agricultural crop residues, woods residues from sawmills, rice husks from rice mills and oil palm wastes from mills and plantations. One can also add to the list municipal and household collections.

Whether these wastes and residues are economically viable depends on whether they are easy to collect and whether projects can be developed next to, or near, the source of supply, is critical.

may affect future availability. Past assumptions of negative cost or low costs may not apply in the future in the “gold rush” to secure supply. First movers who can lock in long-term supply at favourable prices are likely to suceed.

Recyling of biomass is standard practice in oil palm plantations. The picture above shows empty fruit bunches being recycled around an oil palm

power generation, or organic acids for the production of products like bioplastics. Such projects have proven track records and revenues are secure with as offtake agreements in place.

Most farmers and mills do not see the need to invest in technology, necessitating new players to take the risks. Higher-end technologies for the conversion of biomass to sugars and cellulosic ethanol have not yet been commercially proven although there are some interesting options.

For now, it is sufficient to use the

most cost-effective conversion technology available. Too often, projects based on high technology costs fail due to pricing issue.

Competing demand Biomass resource allocation to meet competing demands is an important consideration for both policy-makers or the business at hand. There is an insatiable demand for organic fertilisers, not least because of expected increase in demand for organic food but also to mitigate the rising prices of inorganic fertilisers. Empty fruit bunches are also used in pulp and paper and mediumdensity fibreboards.

As for bioenergy, the choice between reserving biomass for conversion into pellets or bioethanol will eventually be posed, and a roadmap based on technology costs and demand will have to be developed. Electricity generation from biogas to feed into the grid also has a special place.

Finally, biomass have to be evaluated for sustainability as well. This will become important for bioenergy and biofuels. The import of biopellets into Europe, and biodiesel produced from palm fatty acid distillate, for instance, will need to meet requirements under the EU Renewable Energy Directive.

While the criteria has yet to be established, it has been proposed under the Roundtable on Sustainable Biofuels that biomass wastes and residues have to come from sustainable sources such as plantations with certified sustainable practices.

It is also the case that as more waste and residues are used, and especially to substitute fossil-based fertilisers or energy on farms and plantations, the greenhouse gas emissions over the life cycle of a product such as palm oil drops, and the product itself becomes even more sustainable.

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Get the edge with frugality Hyper-related world must embrace spirit of competitive frugality in the service of less Asia can play large part in purchasing patterns and growth that serve sustainability

By Bruce Piasecki

Blazing growth is taking place in China, Brazil and India. The Asian Tigers (Korea, Singapore and Malaysia) are fast followers. This may seem like old news – an idle tribute to a twospeed world. But with the earth soon to host its seven billionth person, it would be wise not to neglect a looming 21st century reality: The basic human struggle for freedom, expression and aspiration will meet head-on the equally fundamental human need for food, shelter and energy. The one earth spins at an all-important shared speed.

Since I wrote my new book Doing More With Less: The New Way to Wealth, we have seen riots over rising food prices in several regions of the world, vast unrest in the Arab world and a stagnating Anglo-American complex that baffles both presidents and CEOs. Industrial nations have typically responded to the needs of growing populations by striving in the service of more – more rice per hectare, more highways, more sky-rises, more personal and corporate wealth, more of everything. History suggests one thing: This works, until it doesn’t.

And today, it is resoundingly clear that our obsession with more, and our faith in the superabundance of resources and the technological miracle are not only hurting the environment, people and a certain nation’s competitive status in the world market, but it is also blinding us into inaction.

In this hyper-related world, we must embrace a spirit of competitive frugality in the service of less. From Asia, the former Soviet states, the old Europe to the new island economies, we must embrace the mantra of “doing more with less.”

This may seem a radical concept, but it is simply the modern version of what Benjamin Franklin preached     •  

– and what most industrialists once practised – three centuries ago when “Big Ben” became known as the first world citizen for his values in competitive frugality, innovation and diplomacy. My new book outlines why we must become like Ben Franklin all over again in this new, more densely populated century.

Dr Bruce Piasecki is president and founder of management consulting firm AHC Group (www.ahcgroup.com)

made toxic by the relentless logic of excess.

Look around at our small, spinning planet. Despite the global economic slowdown, India, Brazil, Indonesia and some Asian nations are thriving by being frugal and inventive at the same time. In governments, struggling with years of debt, as well

“As the world becomes more defined by severity in weather and markets… I predict that the art of competitive frugality will become the defining feature of top-tier nations and governments.”

This 256-page book is to be published by Wiley and Sons in 2012

Roadmap for purchasing and performance Franklin’s wit and wisdom about self-determination and competitive frugality amount to much more than the self-help talking points we hear rehearsed each day on popular television and YouTube highlights.

Franklin’s insight was in fact about being frugal in a deeper, more creative way. It was in the anticipation of scarcity, and in the creative acceptance of limits, that Franklin learnt to do more with less – from his idea of a shared public library to his convictions about the use of printing.

Consider his words of warning against wasting time and other resources: “Sloth makes all things difficult, but industry easy… He that rises late, must trot all day, and shall scarce overtake his business at night, while laziness travels so slowly that poverty soon overtakes him.” This offers nothing less than a roadmap for national and corporate renewal – and a cleansing regimen for the modern soul

as in corporations, I see a greater willingness to do more with less as the winning organisational formula.

Indeed, as the world is increasingly defined by severe weather and markets, and as our global information exchange becomes swifter and more agile, I predict that the art of competitive frugality will become the defining feature of top-tier nations and governments.

One silver lining in the current stagnant global economy is that it is forcing all regions to embrace again the art of competitive frugality, and refine it again for our times. This spirit will require giving up the impulse of first use, ease, and indulgence at times. Such a spirited human response to challenge is built into our cultural DNA, and many golden ages were preceded by intensely inventive periods of inward discovery on how to do more with less. It was only in the last 100 to 150 years that many decision-makers forgot these aspects of human aspiration.

An urgent quest to Asia The pursuit of market answers to social problems concerning mobility, safety, sustainability, food supplies and quality of life in a world of seven billion people cannot be achieved leisurely.

It requires aggressive innovation, and stabilising periods of peace and exploration. Today if we ask the best-trained leaders from Asian schools and companies to rally around this idea, Asia will help chart this new century indeed.

In the past century, the one where

editorial

I was first trained, the high-water marks of creativity and scarcity came during major wars, when research and development (R&D) budgets were devoted to destruction for protection, and this gave us stunning new technologies ranging from nuclear energy to titanium and biofuels. In this new century, Asia can play a large part in future purchasing patterns and growth by marshalling the same inventiveness of the past, the same technical and operational excellence in manufacture,

in the genius of serving sustainability.

And make no mistake about it – it is the only war we must win.

Dr Bruce Piasecki is president and founder of management consulting firm AHC Group, that works for some of the world’s largest corporations. This essay is based on his forthcoming book “Doing More with Less: The New Way to Wealth”, to be published by John Wiley and Sons in 2012.

To learn more of his earlier books, visit www.worldincbook.com.

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Impress, sport your low-carbon tee Synthetics use fossil fuels, that’s why organic cotton and wool are more environment friendly How you wash and dry your shirt equally determines its carbon footprint

By Prasad Modak

The next time you sport a T-shirt at a party, be sure to have a label that says it‘s low carbon! Everyone is going to ask you what it means. Essentially, you will be wearing a T-shirt that has a low or near-zero carbon footprint. Indeed, that will impress all.

Carbon footprinting (CF) reflects the amount of greenhouse gas (GHG) emissions associated with a product or service, right from the sourcing of raw materials for its production, along the supply chain, to end-of-life recovery and disposal. So your low-carbon Tshirt is a climate-friendly product.

For a low-carbon T-shirt, the fibre matters. The energy needed to produce different fibres varies substantially, and so do the GHG emissions. Most synthetic fibres use fossil fuels, an inherently non renewable resource. In fact, this is one reason why organic cotton and wool have become preferred fibres to develop textile goods of low-carbon footprint. Total kg CO² emissions from every tonne of polyester produced in the USA is 9.52 as against 3.75 for organic cotton in India. This is based on a study by the Stockholm Environment Institute carried out on behalf of the BioRegional Development Group.

For the same product category

and fibre, the CF varies depending on the product specifications. For example, for a long-sleeve shirt, the Carbon Case Study carried out by Systain with Otto Group shows that, CF for size 32–34 was estimated at 9.95 kg and for size 44–52 at 11.95 kg as against 10.75 kg for size of 42–44. Hence, size matters.

For textile goods, the use phase is often as important as the production phase. A T-shirt’s carbon footprint depends on how frequently it is washed and the manner in which it is washed and dried. Over the life-cycle, around 50–75% of the T-shirt’s CF will be due

Dr Prasad Modak is chairman of the Green Purchasing Network of India. His email is prasad. modak@emcentre.com

to machine-washing and drying. However, if the T-shirt is dried on a clothesline instead of being frequently tumble dried, the figure falls significantly. So don’t just sport the low carbon T-shirt, but live life in a carbon sensitive way.

Imagine, if all of us started wearing low-carbon T-shirts! This would greatly influence the market, the way we source materials, and process, manufacture and transport goods. Sure it will make a difference. And if we did that, I leave you to calculate how many million tons of GHG emissions we will reduce. Save natural resources and reduce pollution.

Examples of low-carbon T-shirts EarthPositive™: In the UK, the Carbon Trust, working with Continental Clothing, has developed the world’s first carbon label for clothing. EarthPositive T-Shirts are manufactured using solely sustainable energy generated from wind and solar power. EarthPositive apparel is certified as 100% organic under the Global Organic Textile Standard, and is licensed by the Soil Association.

Continental has already ensured the T-shirts create 90% fewer carbon emissions in the manufacturing stage.

AnvilRecycled™: Anvil’s recycled T-shirt is made entirely with pre-consumer textile clippings that are gathered, sorted by colour, chopped into fine material and then spun into yarn. Cardboard is recycled instead of discarded, scrap materials are used to generate steam power, and waste water is cleaned beyond the standards set by government regulations. To top this, Anvil made the tee carbon neutral by reducing emissions during the production process and by offsetting emissions.

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editorial

 

Sustainability versus lavish lifestyles Extremely ostentatious lifestyles of the rich threatening sustainability Ways needed to curb such behaviour as society battles to save Earth

Dr Goh Ban Lee is a researcher who writes extensively on urban governance, housing and city planning

People are no longer just talking about sustainable development; many are now putting it into practice.

These people range from factory managers practising green purchasing to housewives undertaking waste separation, recycling and composting.

It is heartening that there are positive impacts from the United Nations Environmental Programme (Stockholm, 1972) and more importantly, the World Summit on Sustainable Development (Rio de Janeiro, 1992; Johannesburg, 2002), especially in Europe. However, it is important to note that Asians are beginning to be in the limelight for excesses in the use of the earth’s resources. The term “conspicuous consumption”, first used

by Norwegian-American economist Thorstein Veblen more than a century ago, is now becoming common as more and more Asians get rich in tandem with the high economic growth rates of their countries.

Conspicuous consumption is defined as “spending in a lavish or ostentatious way, especially to impress others with one’s wealth”, according to the Collins English Dictionary. In China, a country once known for its ubiquitous bicyclists, the wedding of a film star in 2008 exhibited a string of Lamborghinis, Ferraris, Rolls-Royces and Bentleys. In India, an industrialist built a 27-storey building with a total floor space of 37,000 sq m (about 400,000 sq ft) to house a family of five in Mumbai, one of the most congested cities in the world.

These are extreme demonstrations of ostentatious lifestyles in Asian cities. The worrying thing is that it does not take a billionaire to indulge in conspicuous consumption. In an article entitled “Materialism and conspicuous consumption in China: A cross-cultural examination”, based on data collected     •  



By Goh Ban Lee

Shopping into the night in Tokyo at the famous Shibuya crossing: A main challenge for Asian societies is to curtail rising conspicuous consumption in an era of much-needed sustainable development

in Beijing, Shanghai and Shenzhen, Jeffrey Podoshen, Lu Li and Junfeng Zhang concluded that “both materialism and conspicuous consumption are on the rise among urban Chinese consumers”.

There are people, including those who are not rich, who do not see anything wrong with conspicuous consumption. They claim those who earn such wealth have the right to spend it, even if they use up large amounts of the earth’s resources.

It is understandable that as Asians become richer, they buy more goods and services to raise their quality of life. However, when others are taking extra steps to save the earth’s limited resources, it is inappropriate to use resources merely to demonstrate one’s financial wealth. The challenge is to find methods to curtail conspicuous consumption.

One can shame those who practise conspicuous consumption, and it may even be satisfying for those who do the shaming, but a confrontational strategy is not likely to succeed.

A better alternative is to popu-

larise ideas that enable those who are economically successful to demonstrate their riches in an environmentaland resource-friendly way. It is useful to recall British economist E. F. Schumacher’s message in Small is Beautiful: Economics As If People Mattered, written in 1973. That year also marked the beginning of a global energy crisis as a result of an oil embargo by the Organisation of Arab Petroleum Exporting Countries (OAPEC) in response to the United States of America’s decision to re-supply the Israeli military during the Yom Kippur war. This helped make Schumacher’s ideas very popular and influential. In 1995, more than two decades later, The Times Literary Supplement ranked Small is Beautiful among the 100 most influential books published since World War Two. In the era of 24-hour news channels, social media and the Internet, the means to spread messages are aplenty.

What are needed are writers and commentators to let the world know about the harm done to the Earth’s resources in cases of conspicuous consumption.

editorial

Iceland blows hot on renewables It may soon export up to five billion kWh per year of clean geothermal electricity Energy efficiency and conservation should not be neglected even with abundant resources

turbines to generate electricity, and how much of that electricity is transported across significant distances; I’d expected most of it to be heating water for direct use rather than spinning turbines, and to be used near the point of origin, as it is at home. Transporting energy across distances cuts down on efficiency.

But efficiency and conservation aren’t such big concerns in Iceland.

We were rather surprised that saving water or electricity didn’t seem to be a value. People just ran the water or left lights on. Their attitude was that they had plenty, it was really cheap, and they didn’t have to worry about running out. 

I’ve known for years that Iceland is a geothermal paradise, so when we went there this summer, I made sure to pay some attention to its power supply.

As it turned out, that was absurdly easy to do. You can’t travel in Iceland without encountering the power of geothermal energy, and many Icelanders we met bragged about their geothermal systems. We even encountered several museum exhibits highlighting volcanic and geothermal activity.

While there is significant use of hydropower along with geothermal, we saw almost no solar in Iceland – in part because usually they don’t have too much sun, and in part because geothermal and hydro are readily available and produce much steadier (and cheaper) power.

In the United States, where I live, harnessing geothermal energy typically involves drilling below the earth to a layer with a year-round consistent temperature of about 50°F/10°C, and tapping into that layer to boost heating in the winter and cooling in the summer. I live in the northeast United States, in a region called New England, where temperatures typically range from -5°F/-20.5°C on a cold winter night to around 95°F/35°C on a hot, sunny summer afternoon. In fact, my neighbours just installed a geothermal system in their house, which was built in 1747. Like most geothermal installations in the US, they are using the thermal power directly, to heat and cool water.

In actively volcanic Iceland, it’s a different story. Temperatures in many of the hot springs are close to the boiling point of water – hot enough to kill a person quickly. All you have to do is feel the water coming out of the hot tap to know that geothermal means something different there. It’s HOT! As hot as the solar-heated water I use in my home, which is hotter than tap water from most fossil-heated sources. So that aspect of Iceland felt very familiar.

Shel Horowitz is the primary author of “Guerilla Marketing Goes Green”.

He can be reached at shel@ greenandprofitable.com

Iceland runs almost entirely on renewable energy which it sources from hydropower and from geothermal power plants like this one

Differences There are several differences, though.

First, the water at home smells of the chlorine that municipal authorities use to purify it. In many parts of Iceland, including the capital, Reykjavik, the water smells strongly of sulphur – so strongly that my toothbrush would smell like elderly eggs, hours after brushing.

Another difference is the ubiquity of the system. Geothermal is heavily commercialised in Iceland. Municipalities harness and pipe it into virtually every house and building, as well as the numerous geothermally heated municipal swimming pools and hot tubs in literally every town we visited. But in the US, geothermal systems are purchased by the individual homeowner, and are expensive enough that people are very cautious about making such a large investment. My neighbours spent US$38,000 on their system.

And third, I was surprised at how much geothermal power is used to run

Export potential Personally, I think that’s shortsighted.

They may have plenty now, but that could change in the future, especially as the country begins exporting to parts of Europe that are not so richly endowed with power. I think the conservation-isn’t-important attitude will change with education and a valuesshift, just as it has shifted in Asia, North America, and especially continental Europe. Meanwhile, Iceland can truly claim to have one of the greenest power grids in the world.

In a country with only 318,452 inhabitants as of January 2011, and approximately 116,000 households, this tiny country has the capacity to supply much of Europe’s energy needs. In fact, plans are afoot to build deep-sea cables that will export as much as five billion kilowatt-hours of clean, renewable electricity to the rest of Europe – enough to power 1.25 million homes. Those of you based in Europe, especially, should be on the lookout for opportunities to profit from this coming industrial shift. And those in other seismically active parts of the world might want to think about how to get your country into massive geothermal.    •   

information

Recognition for green corporate leaders Companies now measured by 3Ps: profit, people and planet, says Frost & Sullivan Top management support critical in successful implementation of green practices

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By Bhavani Prakash

Twenty-six companies from the Asia Pacific region, and two global players, were honoured for achieving excellence in sustainable products, services and strategies at the first ever Frost & Sullivan Asia Pacific Green Excellence Awards 2011, held in Singapore on August 26th.

The companies were evaluated based on their social impact, overall market growth and penetration, profit margins, growth in market share, stock price and overall industry impact.

Green Purchasing Asia was the media partner for the event.

Partner and Asia Pacific managing director of Frost & Sullivan, Manoj Menon who presided over the banquet, said the awards recognise that although sustainability is in its infancy, it is growing and will have a profound impact on every aspect of business. The megatrend, he observed, is for companies to be measured on their triple bottom line, namely, profit, people and planet.

A sheer range of industries were acknowledged, demonstrating that green as a theme cuts across various sectors such as building and environment, energy (including IT), logistics, healthcare and chemicals.

Likewise, size does not matter for sustainability efforts. Awardees came     •  

from large companies like roofing solutions provider Monier Sdn Bhd operating in 33 countries, to smallscale biotech organisations such as Microgen Australia employing less than 20 people.

The awards showcased, among others, exciting research and innovation in the use of algae and yeast for different purposes. Paul Zaman, representing MBD Energy, an Australia-based company, described carbon capture through algae, one of the solutions to reduce industrial CO² emissions, by converting flue gas into fuel. Algae is also used for water bioremediation. Syed Isa Syed Alwi, group CEO of Algaetech, which researches algae for functional food and biofuels, said candidly, “Algae cannot solve all problems, but it can certainly solve some problems.”

Algaetech also develops integrated renewable energy plants combined with algae cultivation and production.

Microgen Australia uses, on the other hand, enhanced non-GM yeasts to convert plant biomass into ethanol and food protein. CEO Geoffrey Bell believes that large corporations need to be convinced that it is not just fuel which is the problem, but food.

According to the Food and Agriculture Organisation (FAO), food production

Green Purchasing Asia’s managing director Lim Siang Jin presenting an award to Syed Isa Syed Alwi, group CEO of Algaetech

needs to double in the next 40 years but 80% of fisheries are already overexploited.

Product innovation was evident in other industries too, from data centre power management by Emerson Network Power, green chemistry by Emery Oleochemicals and renewable waste to energy generation by Asia Biogas.

Petri Jokinen, managing director of Neste Oil Singapore, spoke of NExBTL, Neste Oil’s proprietary premium-quality renewable diesel which has been shown to reduce greenhouse gas emissions by more than 50% over the product’s entire life cycle when compared to fossil diesel.

Its lower tailpipe emissions also makes a valuable contribution to enhancing overall air quality.

Fujita Tetsuro, CEO of Nippon South East Asia group remarked

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Green champions of Asia Pacific with their awards at the Green Excellence Awards night, Amara Sanctuary Resort Sentosa, Singapore

how green innovation had helped the company save resources while enhancing consumer wellbeing. He cited the low-VOC content of Nippon paints, which also absorb harmful indoor air pollutants.

Awardees also highlighted how operational and supply chain efficiencies had brought about cost savings and environmental benefits.

Georg Harrasser, CEO Asia Pacific of Monier Sdn Bhd, said the energyefficient roofing solutions of his company translate to 30% reduction in energy consumption through reflectivity and natural ventilation.

UGL, a green facilities management company and Hongkong International Terminals, a cargo terminal operator, echoed how efficiencies had brought about

greenhouse gas emissions reductions.

In the latter’s case, it has been an impressive 40% year-on-year reduction. Likewise, homegrown logistics provider Keppel Logistics achieved 7,500 tonnes of carbon emission cuts with the implementation of a carbon monitoring system.

Green practices have also enabled companies to achieve cost leadership through higher environmental standards, be it through health and safety, energy conservation or recycling as highlighted by Lonza Biologics, a pharmaceutical contract manufacturing company.

CapitaLand, a Singapore-based developer, also pointed out how top management commitment is critical for the successful implementation of green practices, as demonstrated by the

encouragement given to their “green army” for innovation, creativity and entrepreneurship. A definite hit at the awards ceremony was the company’s mascot for its community initiatives – a little green frog. As Wong Hooe Wai, chairman of CapitaLand Green Committee pointed out, they chose an amphibian because of the importance of air, land and water.

As the audience passed along the stuffed doll version of Capitafrog to one another, it became clear there are many creative avenues to spread green awareness, which is a growing phenomenon. The companies present at the award have shown that it is not difficult going green. On the contrary, it may be the most important way to achieve sustainable growth, innovation, cost savings and efficiency.

Frost & Sullivan Asia Pacific Green Excellence awards recipients Asia Pacific

Building and Environment

Energy

Logistics Healthcare

Chemicals

Technology innovation in eco-materials

Cardia Bioplastics

Technology innovation in waste processing

Blest

Technology innovation in carbon capture

MBD Energy

Technology innovation in green building materials

Monier Sdn Bhd

Green facilities management company of the year

UGL

Green builder of the year

CapitaLand

Product innovation in renewable energy

Solar Frontier

Technology innovation in data centre power management

Emerson Network Power

Technology innovation in building power management

Ubiquitous

Solar energy vendor of the year

Kyocera Corporation

Wind equipment vendor of the year

Suzlon

Wind project developer of the year

AGL Energy Limited

Geothermal equipment vendor of the year

Fuji Electric Co., Ltd.

Geothermal project developer of the year

PT Pertamina Geothermal Energy

Green home-grown logistics service provider of the year

Keppel Logistics

Green cargo terminal operator of the year

Hongkong International Terminals

Green pharmaceutical contract manufacturing company of the year

Lonza Biologics Tuas

Product innovation in industrial biocatalysts

BioWish

Service innovation in algae technology

Algaetech

Product innovation in renewable chemicals

Emery Oleochemicals

Technology innovation in bioenergy

Asia Biogas

Product innovation in bioenergy

Neste Oil

Product Innovation in automotive coatings

PPG

Product Innovation in decorative coatings

Nippon Paint

Service Innovation in paint re-use

Akzo Nobel

Product Innovation in natural tocotrienols

Palm Nutraceuticals

Global Chemicals

Technology innovation in green chemistry

LanzaTech

Healthcare

Technology innovation in biotechnology

Microbiogen    •   

information

IGEM harvests a crop of green collaborations GE and Tune Hotels to work on developing greener buildings Malaysia Green Technology Corporation signs eight MoUs with commercial and academic institutions

A total of 12 memoranda of understanding (MoUs) were signed between various parties during the recently concluded 2nd International Greentech & Eco Products Exhibition and Conference Malaysia (IGEM 2011), which drew some 68,000 visitors to Kuala Lumpur Convention Centre over four days from September 7th to 10th.

General Electric International Inc (GE) and Tune Hotels signed a Memorandum of Collaboration (MoC) to identify opportunities in energy efficiency and cost savings in Tune Hotel’s operations globally.

The MoC was signed by GE ASEAN president Stuart Dean and Tune Hotels group CEO Mark Lankester.

The collaboration is expected to help Tune Hotels towards achieving relevant eco-building certifications such as with Malaysia’s Green Building Index, Singapore’s BCA Green Mark and the US Green Building Council’s LEED rating.

Malaysian light emitting diode (LED) manufacturer ItraMAS and SIRIM Berhad signed an MoU to jointly create an advanced composite material for thermal management systems that will go into ItraMAS’s series of new products under their existing Q-RAYTM LED product line.

Malaysia Green Technology Corporation (MGTC) CEO Dr Nazily Mohd Nor disclosed that eight MoUs were signed between MGTC and other commercial entities, such as GE, as well as local and foreign academic institutions. These MoUs include the following: • With GE: To explore green initiatives, build public awareness through a series of campaigns to promote green technology and sustainability initiatives, and share best practices and green technology development.

GE ASEAN regional managing director of business development Rahul Gupta says they will look     •  

 

By Stephen Ng

The exchange of MoU between GE ASEAN regional managing director of business development Rahul Gupta and MGTC CEO Dr Nazily Mohd Nor is witnessed by Hajjah Nor’aini Abdul Wahab, deputy secretary general of Green Technology and Water, Ministry of Energy, Green Technology and Water

at projects involving the design, planning and implementation of a new government certification or standards for green technology development, such as green buildings and professional certification in green technology with a focus in developing human capital.

GE and MGTC will also explore the feasibility of electric vehicle (EV) infrastructure in Malaysia. The initiative will entail joint lobbying to raise public and government awareness on the EV framework, as well as running EV pilot tests in several locations across Malaysia.

• With Akademi Inovasi Malaysia (AIM): To train and develop human capital in the field of energy audits and carbon emission and reduction.

The collaboration will also develop learning and awareness programmes for schools, institutions of higher learning and special interest groups.

• With Universiti Teknologi Mara’s Malaysia Institute of Transport (UiTM-MITRAN): To work in areas of research and consultancy,

and provide training for logistics practitioners, score cards for ecodriving, an economic index for the “sustainable fuel – consumer relationship”, and evaluating the impact of subsidies on fuel pricing and infrastructure for natural gas vehicles (NGV).

• With Rosenheim University: To build a joint Centre of Excellence for Advanced Building Materials in Kuala Lumpur, where research will be carried out on the suitability of some new materials for tropical climates.

• With Universiti Putra Malaysia (UPM): To develop a Centre of Excellence for green technology with a focus on energy, building, water and wastewater, transportation, manufacturing, information technology, agriculture and recycling.

The IGEM exhibition and conference is an annual event. IGEM 2012 will be held next year from October 10th to 13th in Kuala Lumpur.

information

  

Brazil powers into top 10 climate countries

geothermal/marine, diversified renewables, gas, nuclear, bio-energy, integrated power, buildings efficiency, industrial solutions, transport efficiency, fuel cells, energy storage, water, waste, pollution control, investment companies and carbon trading.

Of these, integrated power was the biggest earner at US$187.1 billion, followed by nuclear at US$76.8 billion and water at US$55.3 billion.

The report noted that emerging market (EM) countries have, in recent years, been ramping up their engagement in climate-related businesses. The year 2009 represented a major breakthrough for EM countries with China joining the ranks of top ten climate countries for the first time.

This year, China moved two places to eighth spot, with Brazil at ninth. Brazil posted a 94.7% increase in revenues in WWPC and a 70.4% increase in LCEP.

Global climate revenues hit a record high of US$567 billion in 2010 Emerging market’s climate revenues climb 21%

Emerging markets posted impressive growth in climate revenues last year, with pack leader Brazil breaking into the ranks of top ten climate countries, according to the latest annual report of the HSBC Global Climate Benchmark Index.

Their aggressive performance contributed greatly to the 7% global climate revenue growth last year, producing a new all-time high of US$567 billion. This is a significant achievement for a sector that enjoyed an average compound annual growth rate (CAGR) of 39% between 2004 and 2008, before the worst recession in many years stalled growth in 2009.

The index tracked the performance of 380 companies around the globe that are focused on developing solutions to combat the effects of climate change in four principal sectors: Low Carbon Energy Production (LCEP), Energy Efficiency and Energy Management (EEEM); Water, Waste and Pollution Control (WWPC) and Climate Finance. The minimum market capitalisation threshold for the index is US$400 million.

Where to put your money

• Low carbon energy production

(LCEP) currently offers historically high dividend yield.

The market is now pricing in a 12-month forward dividend yield of 4.9%, which is 2.0 standard deviations above its five-year mean, and this is the highest level recorded over the past five years.

• Within the LCEP sector, hydro/ geothermal/marine offers the highest consensus 12-month forward dividend yield of 7.3%.

This was the revenue performance of the four sectors, compared to 2009 level (see chart 1): • LCEP: Up 22.8% to US$353.5 billion • WWPC: Up 2.2% to US$79.8 billion • EEEM: Down 18.5% to US$133.3 billion • CF: Down 7.8% to US$0.122 billion The index reflects 18 broad investment themes (under the four sectors), namely solar, wind, hydro/

Chart 2: Climate revenues up across all market caps

600

600

500

500

400

400

US$ billion

US$ billion

Chart 1: Climate change revenues reached record high

300 200

300 200 100

100 0

Investment flows Investment flows into asset finance, public markets and private equity over the past year (up to September 2nd) reached a total of US$127.5 billion, or a 2.9% decline on the same period in 2010. The share of climate investment flows into both developed markets (DM) and EM has remained roughly constant since 2009, with DM accounting for 60% of the pie. DM have over the past year captured US$78.2 billion of investment flows while EM accounted for the remaining US$49.3 billion.

2004

EEEM

2005

2006

2007

2008

LCEP

Source: HSBC equity quantitative research

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WWPC

2009

2010

CF

0

2004

2005

Sm all caps

2006

2007

2008

Mid caps

Source: HSBC equity quantitative research

2009

2010

Large caps

At 35%, Europe continues to attract the largest proportion of climate investment flows followed by Asia Pacific at 31% and North America at 24%.

On a sector basis, LCEP took the lion’s share of US$108.3 billion, with EEEM and WWPC at US$16.7 billion and US$2.3 billion, respectively. In comparison, flows into CF totalled only US$0.2 billion.

Wind and solar continued to attract the largest share of investments, capturing US$55.4 billion and US$30 billion, respectively. The report notes that investment flows into solar were driven principally by asset finance, which rose 115% over the past year to its highest recorded level in seven years. This, in part, is due to recovery in the banking sector and the emer-

gence of more diversified sources of funding across different geographies.

Pure play revenues surge Pure play companies saw an increase in global revenues of 89.3% to US$242.2 billion, which was large enough to more than compensate for the 19.2% decline in revenues from non-pure plays. As a result, pure play companies have now increased their share of total climate revenues from only 24.2% in 2009 to 42.7% in 2010.

Indeed, pure play companies in Asia Pacific, Europe, North America and Latin America all reported significant increases in revenues in 2010 (see table 2). The only region to report a decline was the Middle East & Africa.

In terms of sectors, LCEP has been

Table 1. Climate revenue growth 2009/10 by country and sector

a clear leader, with revenues having more than tripled to US$173.9 billion.

Within the LCEP sector, the strongest revenue generating themes were Diversified Renewable Energy (DRE) up 2,389%, Integrated Power up 572% and Nuclear up 220%.

Revenues up across all market caps Climate revenues have also seen increases across all of large, mid and small caps with the largest increase having come from small caps, up 14.5% (see chart 2). In absolute terms, however, large caps continue to generate the largest portion of revenues, at US$415.7 billion, while the LCEP sector continues to account for the largest proportion of climate revenues.

Table 2. Pure play revenue growth in 2009/10

Region

Total

EEEM

LCEP

WWPC

CF

Asia Pacific

15%

-11%

27%

31%

n/a

Asia Pacific

147%

LCEP

204%

MEA

-33%

-43%

-13%

n/a

n/a

Europe

114%

EEEM

-28%

Latin America

110%

n/a

123%

82%

n/a

Latin America

147%

WWPC

6%

Europe

2%

-33%

23%

-7%

-8%

MEA

-56%

CF

n/a

North America

6%

6%

8%

4%

n/a

18%

n/a

n/a

HSCCB

7%

-19%

23%

2%

-8%

Source: HSBC equity quantitative research

Region

Sector

North America HSCCB

7%

-19%

23%

Source: HSBC equity quantitative research

Automotive and electronics lead Interbrands’ global green list Toyota, 3M and Siemens lead in Interbrand’s Best Global Green Brands report, the international brand consultancy’s first global rankings to focus exclusively on green.

Overall, the automotive industry and electronics category came out ahead in implementing sustainable practices across their organisation as well as communicating their efforts effectively to the public.

According to Interbrand, the report’s methodology combines public perception of environmental sustainability (“green”) with a demonstration of that performance based on publicly available information and data.

L’Oréal, Nokia and HSBC scored significantly higher in performance than perception, suggesting that despite having strong internal environmental sustainability practices, they are still

not yet communicating these efforts to consumers as clearly as they could.

McDonald’s, GE and Coca-Cola, on the other hand, all scored significantly higher in perception than performance, suggesting that green perception of these brands matched the positive overall perception and visibility of the brand.

The Green Performance Score was composed of 82 metrics evaluating each company’s disclosure and environmental performance across six “pillars”, namely

its governance; stakeholder engagement; operations; supply chain; transportation and logistics; and products and services.

The top brands are (1) Toyota (2) 3M (3) Siemens (4) Johnson & Johnson (5) HP (6) VW (7) Honda (8) Dell (9) Cisco and (10) Panasonic The complete list of 50 Best Global Green Brands can be found at www. interbrand.com/en/best-global-brands/ Best-Global-Green-Brands/2011-Report. aspx

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information

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Solar PV installation training centre to open Facility ready but syllabus and accreditation matters still outstanding Plans to offer short and long courses for diploma holders and working people

By Ann Teoh

has been scheduled to visit the SHRDC laboratory on September 27th to iron out issues of syllabus, accreditation, classes and teaching instructors. Also expected to make the visit are officials from the Photovoltaic Monitoring Centre (PVMC) at Universiti Teknologi Mara, also in Shah Alam. The PVMC is

 

A second solar photovoltaic (PV) installation training lab has been set up in Kuala Lumpur to meet Malaysia’s needs for trained manpower in solar PV as the country embraces renewable energy (RE) generation. Malaysia will implement the feed-in tariff in December, a mechanism that will

David Khoo at the Amatrol learning board. The lab has two learning boards: one for installation and another for troubleshooting

monetise RE power generation, and hopefully increase its RE mix to 5.5% by 2015 from the current 0.5%.

Physically, the Ministry of International Trade and Industry-funded lab with its array of equipment is ready but syllabus and accreditation matters are still outstanding.

Solar Strategy Business Unit head of the Selangor Human Resource Development Centre (SHRDC) David Khoo said [at press time] that the Sustainable Energy Development Authority Malaysia (SEDA Malaysia)     •  

the only PV training lab in Malaysia but it is also the first in ASEAN to have an ISPQ accreditation. The ISPQ accreditation is from the Institute of Sustainable Power in the United States.

Khoo said SHRDC will discuss with SEDA Malaysia on whether they can adopt PVMC’s syllabus. Work on the lab started in the first half of the year and the original completion date was mid-year, but there has been several delays. With the Malaysian Building Integrated Photovoltaic (MBIPV) project disbanded on May 31st, there

was a vacuum of authority until SEDA Malaysia was set up on September 1st.

The MBIPV project was the de facto coordinator of solar PV development in Malaysia.

SHRDC plans to offer both short courses and longer ones targeted at fresh diploma graduates and working people.

Its plan, pending confirmation

by SEDA Malaysia, is to run a tenday training module that PVMC is also conducting – the Design and Installation of Off-Grid PV Systems Training, and the Design and Installation of Grid-Connected PV Systems Training – that was designed by the MBIPV project.

Khoo said the SHRDC lab would also like to run the government-funded Industrial Skills Enhancement Programme’s (INSEP) Solar PV Installer programme. The full-time programme will comprise four months in the lab and four months’ internship with industry.

The syllabus covers alternate current and direct current fundamentals, electrical systems, on-grid and off-grid systems, and even soft skills like presentation skills, project management, report writing and teamwork. “The soft skills are to ensure the graduates can work as a team, can express ideas and present their design proposals to potential clients, and after the completion of any project, write proper reports.

We will also offer English,” he said.

The SHRDC training facility includes imported Amatrol training boards and computers for online learning. Students will be exposed to different types of solar cells and panels.

Three types of PV modules have been installed: a station with 75 W thin film PV modules from First Solar, one with 130 W polycrystalline PV from Sharp, and another with 180 W monocrystalline PV, also from Sharp.

However, it is not all about high technology when it comes to installing PV panels. Roof conditions and water seepage may mar an otherwise good PV project. Khoo says: “We also set up a station where the students can learn how to remove roof tiles and place them back properly, because unlike some European countries, our Malaysian roofs are slanted and may be more difficult to handle.”

information

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UK and Germany enter Asia’s green education market Singapore BCA offers a platter of building related programmes Malaysia’s private universities growing own programmes

By Ann Teoh

Built Environment (Sustainability).

On top of this, the BCA Academy also offers short-term programmes such as the HFT Stuttgart-BCA Executive Development Programme: Innovations in Sustainable Design and Technology.

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British and German universities have entered the Singaporean and Malaysian markets with post-graduate offerings on green technology, renewables, and environmental sustainability. And a home-grown private university college in Kuala Lumpur has also started its own Master of Environmental Management Technology.

The Singapore Building and Construction Authority (BCA) Academy of the Built Environment offers the University of Nottingham Master of Science in Sustainable Building Design, and the University College London (UCL) Master of Science in Facility and Environment Management. The last intakes were in September.

The University of Nottingham programme’s marketing material says its programme covers a global perspective in sustainable building design for both tropical and temperate climates and will “equip the candidates for jobs in projects such as in the Middle East/ Sino-Singapore Tianjin Eco-City.”

The UCL programme, on the other hand, says its curriculum emphasises successful integration of design and technology, and builds capability in applying sustainable designs globally, including passive green design, renewable energy, solar technology, high impact energyefficient systems, computer simulations and total building performance in its syllabus. Graduates will be able to conduct macro- and micro-analysis and simulations for projects located anywhere geographically.

Singaporeans who are sponsored by their employers can even get a 70% scholarship. The scholarship is offered by the Skills Training for Excellence Programme (STEP), under Singapore’s

Dr Azanam Shah Hashim

In Malaysia, Universiti Kuala Lumpur (UniKL), a private university, has linked up with Germany’s University of Applied Sciences (UAS), Rosenheim, for a joint Master of Engineering Technology (Green and Energy-Efficient Buildings).

Students will do three semesters at UniKL’s Kuala Lumpur campus, and the final semester in Germany.

Subsidised by DAAD, its total fee of RM37,600 (US$12,300) includes a onemonth stint in Rosenheim, Germany.

Lecturers fly in to KL from UAS Rosenheim for their modules.

Dean and head of UniKL’s Malaysian Institute of Chemical and Bioengineering Technology Prof Dr Azanam Shah Hashim says the first intake in February this year attracted six students. He says many enquirers did not feel comfortable about leaving their jobs to take up a full-time programme.

“We are looking at various options, including classes in the evenings and on Saturdays to make the programme more accessible,”

says Azanam, who also teaches in the programme. The material scientist’s current research includes green composites and environment-friendly materials.

Other faculty members include Prof Dr Karl Wagner, Prof Datuk Dr Kamarudin Mohd Nor (whose research interests include sustainable design and construction of buildings, eco-township, building integrated photovoltaics, green construction materials, technopreneurship in green technology and renewables in general) and Dr Robert Bachmann (research interests include solar energy and biomass, and “green” chemicals for water treatment).

Rafidah Mian (left), 38, a senior electrical engineer at the Malaysian Public Works Department (PWD), is taking two years off work to pursue the UniKL/UAS Rosenheim’s programme.

She even received a government scholarship to do this.

“It is one of my best career decisions,” she says. “Our lecturers are focused on ensuring that we understand concepts, rather than just pass exams.”

She says the PWD has been encouraging its engineers to take up courses on energy efficiency and renewable energy but most courses are narrow and specific, for instance, on solar energy alone. “I wanted something broader and more holistic.”

In the meantime, SEGi University College in Kuala Lumpur has launched its Master of Environmental Management Technology, building upon its undergraduate programme on the same subject. The course takes a year and four months, full time, and two years, part-time. Its syllabus covers, amongst others, water and wastewater management, environmental economics, ethics and laws, environmental impact assessment, geographical information system and project management.

Fees are RM24,800. The first intake, scheduled for September, has been postponed to November.    •   

information

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Rising awareness boosts inverter market for RE systems Credit crunch has affected growth but a spike in demand is expected with new credit facilities Price matters for individual sales while quality is important for government and institution funded projects

The Asia Pacific inverter market for renewable energy systems is poised to grow at a compound annual growth rate (CAGR) of 14.5% from 2010 to 2017, fueled by government initiatives.

Policy makers are exploring viable alternatives in the face of climate change and Kyoto Protocol commitments. As fossil fuels diminish steadily, renewable energy becomes more attractive. Countries in the region are taking measures to reduce reliance on imported oil as well as cut greenhouse gas emissions.

For now, incentives and government policies indirectly control the demand for inverter products used in renewable energy systems. The expansion of renewable energy systems directly drives their uptake.

New analysis from “Frost & Sullivan, Asia Pacific Inverter Market for Renewable Energy Systems”, says the market earned US$886 million in 2010 and estimates revenues will rise to US$2,292.1 million in 2017.

“Participants in the renewable inverter market are unable to directly influence overall demand as no amount of technology development or price reduction can translate into increased demand,” says Frost & Sullivan research analyst Merilyn Eng. “However, it helps in building competitive advantage.”

Although the market has been progressing steadily, the credit crunch has affected its growth. Faced with this, some developing countries are unable to build solar power plants and those under construction face delays.

“Though the impact of the recent global economic crisis is still lingering in the region, this challenge is expected to ease as financial institutions such as the Asian Development Bank (ADB) step in to provide loans, grants, and technical assistance,” says Eng. “Thus, a spike in demand for renewable energy system inverter products is     •  

anticipated in the near future.”

Another impediment is the absence of a holistic policy for renewable energy. For instance, a policy issued in Thailand in 2005 set a target to replace 8% of total energy with renewable energy by 2011. In the 15-year renewable energy development plan issued in 2008, the target was adjusted to 20% by 2022.

Trends in this market also indicate polarised preferences for inverter products. For products used on pho-

tovoltaic farms that are under government funding or are being funded by international organisations or institutional investors, quality is a primary issue. For products sold through individual sales to solve remote power shortage issues, price is the foremost concern. This divergence is expected to decrease when the share of low-end products gradually goes down and the uptake of photovoltaic and wind energy systems gathers momentum. – Frost and Sullivan

Renewable energy systems inverter market: Competitive structure (Asia-Pacific), 2010 Number of companies in the market

25 to 30

Distribution structure

Two distribution channels: Original equipment (OE) and aftermarket. OE channel also covers the sales that are included in service contracts and leasing contracts

Tiers of competition

Tier 1 – Multinational renewable energy inverter suppliers and local premium quality photovoltaic system and inverter suppliers competing in top-end markets Tier 2 – Emerging specialised renewable system inverter producers providing best function-to-price ratio products Tier 3 – Unbranded low-end inverters satisfying basic requirements

Key end-user group

• Telecommunication • Commercial

• Home user • Industrial

Competitive factors

• Product quality • Price • Local presence

• Brand equity • Origin of the brands

Source: Frost & Sullivan

Renewable energy systems inverter market: Competitive share by tiers (Asia Pacific), 2010 Tier 1: Leading international suppliers Ş ,@QJDS RG@QD LNQD SG@M Ş $W@LOKDR 2G@QO 2NK@Q 2, %QNMHTR 2@MXN @MC 'DW /NVDQ

Tier 2: Leading regional suppliers Ş ,@QJDS RG@QD ADSVDDM SN Ş $W@LOKDR +DNMHBR +@SQNMHBR 2DKDBSQNMHB

Tier 3: Unbranded products targeting lower-end market Ş ,@QJDS RG@QD KDRR SG@M

Note: All figures are rounded; the base year is 2010. Source: Frost & Sullivan

• The overall Asia-Pacific inverter market for renewable energy systems is dominated by leading international suppliers with market share of more than 15% • Unbranded products targeting the lower-end market acquired market share of less than 5%

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information

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Solar cell market to grow despite overcapacity South Korea’s Samsung SDI Co Ltd expects the global solar cell market to be worth US$70 billion by 2020, more than double last year’s US$30 billion, with falling prices and government support to drive demand globally. Choi Chang-sik, executive vice-president of the company’s solar energy division, told Reuters that a growing aversion to nuclear power after the radiation crisis in Japan and rising oil prices would lift demand for solar energy.

However, Choi also said that there will continue to be overcapacity in the market until 2013, with excess supply amid aggressive expansion by Chinese cell manufacturers and weak global demand. Solar subsidy cuts in top markets Italy and Germany prompted a 20% drop in the price of solar panels in 2011. Despite a difficult market, Samsung SDI is unfazed, and aims to grow its solar cell production to 3 GW by 2015 from about 150 MW now.

(Source: Reuters)

Honeymoon destination now a smart grid testbed

Solar bottle bulbs light up homes Earlier this year, the Manila city government lit up 120 houses at the Baseco Compound in Tondo by installing solar bottle bulbs on the roofs. The bulbs are just clear plastic soda bottles filled with purified water (to ensure better refraction) and some chlorine or bleach (to prevent mould or algae). The bottles are then inserted through the roof of the house, and sealant applied to prevent leaks. Each solar bulb gives light equivalent to a 55 W electric lamp as the water inside it refracts sunlight and exterior light.

It costs only P100 (US$2.30) to P200 to make each solar bulb, and there are no running costs. The bulb is an innovation by students of the Massachusetts Institute of Technology and is promoted by MyShelter Foundation Inc under the Isang Litrong Liwanag (A Litre of Light) sustainable lighting project.

(Source: http://isanglitrongliwanag.org) smart places core, converting modest stucco homes into homes of the future.

More than 2,000 homes have been fitted with solar panels on the roofs. Smart meters and energy storage batteries integrate televisions, refrigerators, washing machines, and air-conditioners. Tablet computers allow homeowners, many who are farmers, to monitor and adjust their electricity use. Power price depends on demand and outside temperatures.

(Source: The Guardian Professional)

Japan passes bill to subsidise renewables

South Korean honeymoon destination Jeju Island is now also the test site of the Jeju Smart Grid Roadmap. The project started with a 64.5 billion won (US$60 million) government investment that will quadruple by the end of the project in 2013. More than 160 companies, large and small, and government agencies, are involved in the four-year experiment.

Korea’s Smart Grid Roadmap has five core components: smart power grid, smart transport, smart renewables, smart electricity, and smart places. SK Telecom leads in the     •  

Japan passed a bill late August to subsidise electricity from renewable sources. The renewable energy bill was passed by the upper house on August 26th following approval by the lower chamber on August 23rd. It was one of the last acts of Prime Minister Naoto Kan. The Act will become effective on July 1st, 2012, and requires utilities to buy electricity generated by renewable sources, including solar, wind and geothermal, at above-market rates.

Rates and contract periods for the feed-in tariff (FiT) will be decided later.

Japan gets about 9% of its electricity from low-carbon sources. Before the Fukushima nuclear crisis, atomic

plants supplied about 30% of Japan’s electricity. The government targets 28 GW of solar-generated electricity by 2020, from the 3.68 GW generated last year. Solar installations may total 1.4 to 1.6 GW this year, says London-based research provider Bloomberg New Energy Finance.

GE, ARCA launch refrigerator recycling The Appliance and Lighting division of General Electric (GE) is partnering with the Appliance Recycling Centers of America Inc (ARCA) as part of GE’s involvement with the Environmental Protection Agency’s voluntary Responsible Appliance Disposal Programme. It is said to be the first manufacturer to do so. The programme will kick off in Philadephia.

The technology belongs to UNTHA, an Austrian company. UNTHA’s recycling process reduces the landfill waste of a refrigerator by about 85%.

It takes care of the foam, used to keep drinks and food cold, that becomes problematic once the refrigerator is discarded. The process will also salvage metal and blowing agents like cyclopentane, chlorofluorocarbons

Ford and SunPower to offer vehicle rooftop solar

Ford and SunPower have teamed up to offer customers a rooftop solar system that enables Ford Focus Electric owners to produce enough energy to offset the electricity used to charge the vehicle. The 2.5 kW rooftop system comprises SunPower E18 Series solar panels that produce 3,000 kWh of electricity annually. These panels generate 50% more electricity than conventional ones and have a smaller footprint.

The system is sized for people who drive 1,000 miles (1,600 km) a month.

The complete system is priced at under US$10,000, after federal tax credits. Included in the purchase is a performance monitoring system via the web or an iPhone application. Financing options are available through SunPower. The solar system will also be compatible with the C-MAX Energi plug-in hybrid electric vehicle Ford is rolling out in 2012. (Source: Clean Edge News)

European green tax to hit air passengers Asian airlines are likely to have to pay up to US$400 million a year for their carbon emissions on European routes from January – a cost likely to be passed on to passengers. The green tax, imposed by the European Union (EU), would mean an extra US$8 per passenger on average.

The South China Morning Post report says carbon credits, used to offset

Carmaker Proton goes electric Malaysian national carmaker Proton has unveiled its fiveseater Saga Electric Vehicle (EV), and seven-seater Exora Range Extended Electric Vehicle (REEV) that were developed in collaboration with British company Frazer-Nash Research Ltd. The cars are expected to go to market in 2013. Work began in 2004 for the hybrid Exora REEV and in 2008 for the Saga EV. At the launch in mid-September, six vehicles were given to the Prime Minister’s Department for test use. Another 200 cars will be given to the government for test use and evaluation over the next one year. Proton will invest RM500 million (US$161 million) over the next two years. (Source: The Star, Malaysia) the carbon emissions, were traded at an average of 15 euros (US$20) to 20 euros per tonne last year. The carbon footprint of one passenger from Hong Kong to London return – 19,244 km – is 1.4 tonnes of CO². Airlines, which account for 2% of CO² emissions, protested against the scheme because it charged for the entire flight, even if the flights are over non-EU territories.

Airlines are granted 85% of their carbon emissions free but must buy the remainder.

Malaysia to fight “anti-trade” palm oil labelling bill Malaysian Plantation Industries and Commodities Minister Bernard Dompok says the country will send a representative to Australia for committeelevel discussions to be held before the Food Standards Amendment (Labelling Palm Oil) Bill is debated in the Australian Parliament. He says Malaysia appreciates the Australian government’s stand that the proposed bill was antitrade. Dompok adds that Malaysia will also communicate with the Independent Representative Council to provide information on Malaysia’s sustainable development of palm oil, and to seek help so that the bill does not get the support of the House of Representatives.

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(CFCs), hydrochlorofluorocarbons (HCFCs), and hydrofluorocarbons (HFCs). ARCA estimates that if the nine million refrigerators annually disposed of in the US go through this programme, the CO² emissions of over two million cars would be avoided. (Source: www.greengopost.com)

On June 23rd, the Australian Senate approved the amendment to the Food Act that specifically labels palm oil as such, and not as vegetable oil.

Malaysia sees that as discriminatory.

(Source: Bernama)

Siemens AG the most sustainable Siemens AG has been ranked the most sustainable company in its industry for the fourth time in a row. In the Dow Jones Sustainability Index (DJSI) – the sustainability rating established by Dow Jones and SAM – Siemens again took first place in the Diversified Industrials category, which includes companies like 3M, General Electric, Toshiba and Thyssen Krupp.

Out of a possible 100 points, Siemens received 90 – its highest overall rating to date and an improvement over last year’s result of 87 points. The company has now been honoured by the DJSI 12 times in a row for sustainable activities.

Siemens is expanding its environmental portfolio, emissions reduction and the efficient use of natural resources. The company wants to generate more than 40 billion euros (about US$55 billion) in revenue with green technologies by the end of fiscal 2014.    •   

Pilot green financing scheme to retrofit buildings Singapore’s building authority has launched a pilot green financing scheme that enables building owners to get loans of up to S$5 million (US$4 million) to retrofit their buildings. The Building Retrofit Energy Efficiency Financing (BREEF) scheme has two partners – United Overseas Bank and Standard Chartered Bank – which will disburse 15 loans over two years to commercial building owners, condominium managements and energy services companies. The banks have set the interest rate at 3.5%. Loan tenure ranges from one-and-a-half years to seven years. The Building and Construction Authority (BCA) will share the risk of loan defaults.

Building owners who do such retrofits will need to comply with minimum certification under proposed amendments to the laws. They will also have to audit their building’s cooling systems once every three years.

Malaysia launches low carbon cities framework

Malaysian prime minister Datuk Seri Najib Razak launched the country’s Low Carbon Cities Framework as part of the government’s target to reduce carbon dioxide emissions by 40% by 2020. He says it was his aspiration to develop Putrajaya and Cyberjaya as examples of eco-friendly townships and to replicate this in other cities and towns in Malaysia. The framework is intended to help achieve the goal, and assist local councils, town planners and developers to formulate action plans to cut carbon emissions. The Energy, Green Technology and Water ministry and the Housing and Local Government ministry are collaborating 62 green purchasing asia • october 2011

to ensure the framework and the Green Neighbourhood Guidelines are effectively applied by local councils.

(Source: The Star, Malaysia)

Index for China cleantech companies across the globe Now there is a good way to monitor China green tech companies that are listed in stock exchanges across the world: the China CleanTech Index, or China Green Enterprise Development Index. The index, published by SinoCleanTech, the Beijing-based arm of Australian CleanTech that promotes investment from Chinese investors into cleantech both in China and internationally, was launched in Xiamen, Fujian Province, China early September. It covers 114 companies with a total market capitalisation of over US$117 billion. It is published monthly and available on www.sinocleantech.com

Jakarta to set green benchmark for private homes The Green Building Council of Indonesia will launch next year a rating system for city homes based on energy, water and raw materials use. The Jakarta Post reports council director of rating and technology Rana Yusuf Nasir saying that two points will be given, for example, when 30% of the house does not need artificial lighting.

The council has established standards for commercial buildings, and surveys to determine green buildings in Jakarta.

McDonald’s among first five restaurants with Green Mark Singapore’s Building and Construction Authority (BCA) has unveiled what is believed to be the world’s first green building certification for eateries, with its new

Green Mark for Restaurants. BCA says it embarked on this initiative because “restaurants utilise high levels of energy and water” on a daily basis. A McDonald’s outlet at Jurong Central Park is one of the first five restaurants certified green. It comes with a grasscovered green roof to keep the building cool, a rainwater harvesting system and energy-efficient LED lights. These features have helped the restaurant save 15% in utility bills over the past three months. (Source: Channel News Asia)

More Fortune 500 brands abandon forestry ecolabel

Seven more Fortune 500 companies have joined a movement against the Sustainable Forestry Initiative (SFI), an industry-sponsored ecolabel that is accused of greenwashing. In March, seven brands, including Allstate, Office Depot and United Stationers said they would stop using the SFI ecolabel on their products or company publications.

Sprint, Norm Thompson Outfitters, King Arthur Flour, AT&T, State Farm, US Bank and Comcast are the latest brands to take action or commit to reduce their support for the SFI. While Sprint will phase out SFI paper, others, like AT&T, committed to not using the SFI logo on their materials or to giving preference to Forest Stewardship Council (FSC) certified products instead for all new paper purchases. Forest Ethics say out of 543 audits of SFIcertified companies since 2004, none acknowledges soil erosion, clear cutting, water quality, or chemical use that are problems with large-scale timber operations.

Panasonic unveils OLED lighting roadmap Japan’s Panasonic Electric Works (PEW) has announced a roadmap to brighten the world with organic light-emitting diode (OLED)

lighting. The company says that in December it will launch easy-to-embed OLED lighting modules with built-in control circuits for use by lighting fixture manufacturers locally and overseas, hoping thereby to cultivate customers to create a new lighting device market. The OLED modules are targeted to suit applications in thin lighting fixtures that work well with trendy, minimalist styles of lighting.

PEW makes numerous products, from home appliances to communication equipment, but a key focal point has been OLED lighting.

Nikkei Electronics reports that PEW announced at the 72nd Meeting of the Japan Society of Applied Physics that it has developed an OLED device with a luminous efficiency of 128 lm/W, topping the 102 lm/W efficiency that Universal Display Corp (UDC) reported in 2008.

Knowledge & networking

OCT

World Renewable Energy Congress 17th-19th October 2011 Bali Nusa Dua Convention Centre, Indonesia http://wreeec2011bali.com/ China Wind Power 19th-21st October 2011 New CIEC, Beijing, China www.chinawind.org.cn/home.html Eco Expo Asia 2011 (International Trade Fair on Environmental Protection) 26th-29th October 2011 AsiaWorld-Expo, Hong Kong www.hktdc.com/fair/ecoexpoasia-en/Eco-Expo-Asia-InternationalTrade-Fair-on-Environmental-Protection.html World Congress on Engineering and Technology (CET) 28th October-2nd November 2011 Shanghai, China www.engii.org/cet2011/

Maria van der Hoeven begins term as IEA executive director Maria van der Hoeven, a fierce supporter of market principles, promoting transparency and establishing a level playing field, has succeeded Nobuo Tanaka as executive director of the International Energy Agency (IEA). During her term as the Netherlands’ Minister of Economic Affairs from February 2007 to October 2010, van der Hoeven advanced several key aspects of her country’s energy policy, including developing the Dutch gas hub policy and accelerating the development and use of renewables.

It is her personal conviction that energy production and use should be made more efficient and cleaner by improving energy efficiency, developing and using renewables, and producing and using energy otherwise generated in the cleanest possible ways. The IEA, founded in response to the 1973/4 oil crisis, is an autonomous organisation that works to ensure reliable, affordable and clean energy for its 28 member countries and beyond.

All-Energy Australia Exhibition & Conference 2011 12th-13th October 2011 Melbourne Convention & Exhibition Centre, Australia www.all-energy.com.au

Singapore International Energy Week 2011 31st October-4th November 2011 Suntec Singapore & Marina Bay Sands Convention and Exhibition Centre http://siew.sg/

NOV

Clean Energy Expo Asia 1st-3rd November 2011 Singapore www.cleanenergyexpoasia.com Asia-Pacific Forestry Week 2011 7th-11th November 2011 China National Convention Centre, Beijing, China www.fao.org/forestry/ap-forestry-week/en/ 10% discount for Building Retrofits Asia GPA subscribers 22nd-25th November 2011 Sheraton Towers, Singapore www.ibc-asia.com/conferences/property/building-retrofits-asia

EnviroAsia 2011 (5th International Environmental Technologies Exhibition & Conference) 22nd-25th November 2011 Suntec, Singapore www.enviro-asia.com

DEC

3rd Asia-Oceania Conference on Green and Sustainable Chemistry (AOC-3) 4th-7th December 2011 Melbourne Convention and Exhibition Centre, Australia http://greenoz.asnevents.com.au/

Visit www.greenpurchasingasia.com for the latest event listings Green Purchasing Asia is a media partner

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Electronics Supply Networks and Water Pollution in China: Understanding and Mitigating Potential Impacts BSR

Electronics Supply Networks and Water Pollution in China Understanding and Mitigating Potential Impacts November 2010

www.bsr.org

Global electronics companies curious about the environmental performance of China-based suppliers to their industry will find this document an interesting read. The 18-page report was published in late 2010 by international corporate responsibility practitioners network Business for Social Responsibility (BSR) in collaboration with the Electronic Industry Citizenship Coalition (EICC).

For the research, ten EICC members submitted supplier names to BSR for matching against a public database with information on corporate environmental violations. Of the 640 supplier names provided, 33 matched with recorded environmental violations in the database (about 5% of the sample) and of these, some 30% were names submitted by more than one EICC member company, showing the interconnected nature of the electronics supply chain. Also, more than 20% of the suppliers with recorded violations had multiple matches, indicating possible systemic issues at     •  

these companies.

The majority of the suppliers with violations were located in the provinces of Jiangsu (39%), Guangdong (30%) and Shanghai (15%), reflecting the concentration of suppliers in those areas but also suggesting that government agencies in these locations may be more effective at monitoring companies within their jurisdiction and are more transparent in reporting environmental information.

The most common components produced by facilities with violations were printed circuit boards (PCBs), supporting expert opinion about water pollution risks of PCB manufacturing.

In addition to providing context on China’s water crisis and regulatory and civil society landscape, the report offers recommendations on supply chain management, and the Appendix contains helpful reports, guides and technical resources.

The report is available for free download at www. eicc.info/documents/ EICCWWFinalReport.pdf

Greenroofs.com With its crowded landing page, cluttered design and heavy ad presence, www. greenroofs.com looks at first glance like a web equivalent of an overgrown rooftop garden. The patient and persistent visitor, however, will be rewarded with a wealth of resources on the business of planning, installing and maintaining green roofs. (Green roofs, sometimes also known as living roofs, are an increasingly popular and environment-friendly way of keeping buildings cooler,

beautifying urban spaces, and mitigating runoff.)

While the homepage offers enough links to the latest green roof articles, videos, job postings, event listings and blogs to keep you occupied for hours, take the short-cut to the site’s the most popular section by clicking the “Greenroofs101” button on the top navigation bar. That’s where you’ll find everything from the history of green roofs to their advantages, from applications of such roofs to the plant and material components required.

Greenroofs.com also publishes the Greenroof Directory, the Greenroof & Greenwall Projects Database, and greenroofs.tv – a video channel dedicated to the topic. All these sprung over a decade ago from publisher and editor Linda Velazquez’s independent study paper website project and continues to thrive as a vibrant family-run enterprise.

The Green IT Review

The Green IT Review blog offers information and analysis on how information and communication technologies (ICT) can be harnessed to reduce

businesses’ and consumers’ carbon impact on the planet.

Aimed at professionals in ICT, cleantech and sustainability, the blog covers a wide range of news ranging from the latest industrial partnerships to government policy changes, to innovative telecommunications applications and new business models for working more sustainably.

The blog began in 2008 as the news and comment site of The Green IT Report, a consultancy started by UK-based Pete Foster in 2007. Back then, as Foster recalls on the site’s “About Us” page, IT processing power and storage capacity were cheap enough to buy in excess and turn on – to the extent that “whole data centres were running at 10– 15% efficiency but pumping out CO² by the tonne.” As the ICT industry grew more aware that such practices were unsustainable, the consultancy carved its niche as a source of research and support for the ICT industry, with The Green IT Review blog serving up a steady flow of comment on various green solutions available for – and through – the use of IT. (Foster, who is the editor of The Green IT Review, is also a writer for The Guardian.)

Today, the The Green IT Review is updated several times a week and recent posts cover topics like green product packaging, the growing trend towards smart cities, and new ideas in dematerialisation, which includes solutions such as cloud computing, web conferencing, downloadable media (vs. physical manufacture and distribution), etc.

Look up the blog at www. thegreenitreview.com