Climate change is the global innovation challenge of our time. That was the theme of a Green Innovators in Business Network “Solutions Lab” in Cambridge, MA, last month co-hosted by C2ES, EDF, Innocentive, and others. Dr. Andrew Hargadon, a leading expert in technology management and author of “The Business of Innovating,” articulated for participants the enormous scale of innovation needed to achieve a clean energy economy. “Low-carbon innovation” is about dealing with new problems—carbon emissions, skyrocketing energy costs—that emerge from traditional solutions for making our economy work, such as for transporting goods or lighting our buildings. Transforming energy-consuming activities to emit less carbon requires that we deploy new technologies that will work with conventional behaviors, and develop entirely new behaviors.
C2ES's December 2011 features updates from the 17th annual Conference of the Parties (COP17) in Durban, South Africa, policy options for a clean energy standard, a blog post on the landmark new fuel economy standards, and more.
As discussed in the first part of this blog series A Strong Defense for Low-Carbon Innovation, the U.S. Department of Defense (DOD) has both the demand for and procurement capabilities to advance the development and deployment of innovative low-carbon technologies. This post highlights a variety of leading businesses innovating and creating new opportunities in response to the U.S. Department of Defense efforts, and some of the challenges businesses encounter along the way.
Strategic public-private partnerships are key to helping the DOD meet its energy goals and present significant low-carbon business opportunities. Employing the expertise of companies, such as those specializing in electricity generation or computer technology, gives the DOD access to specialty skills and knowledge needed to advance innovative low-carbon technologies. Businesses, in turn, have the potential to enhance their competencies through government-funded research and development, or provide new technologies for commercial markets after large-scale demonstration through the DOD.
This post is the first of a two-part series on low-carbon innovation in the defense industry. It looks at how the DOD is uniquely positioned to drive low-carbon innovation. The second part in the blog series looks at how businesses are working with the DOD to bring low-carbon solutions to market.
From GPS to the Internet, the U.S. Department of Defense (DOD) has a history of driving the creation of innovative technologies now used every day by Americans. With low-carbon policies a major challenge in Washington today, many clean energy advocates are seeking leadership from the DOD, which is the single largest consumer of energy in the country, to help drive clean energy solutions. Motivated by the need to better protect troops and support its operations, the DOD is becoming more involved in low-carbon technology research, development, and deployment. As stated in the 2010 Quadrennial Defense Review (QDR), this work will shape the future commercial potential of energy technologies, as “military installations [serve] as a test bed to demonstrate and create a market for innovative energy efficiency and renewable energy technologies.”
For those of you who came to our website today expecting to find information and resources from the Pew Center on Global Climate Change, please don’t click away. Today we announced an exciting transition. We are now C2ES — the Center for Climate and Energy Solutions. In addition to changing our name, we’ve refreshed our mission and strategic approach, updated our website, and made other changes to ensure that we can continue to craft real solutions to the energy and climate challenges we face today.
Yes, a great deal has changed in the last 24 hours. But what hasn’t changed is the need for straight talk, common sense and common ground. Today’s climate and energy issues present us with real challenges — and real opportunities as well. This is about protecting the environment, our communities and our economy. And it is about building the foundation for a prosperous and sustainable future.
Plug-in electric vehicles (PEVs) are a transformative technology – offering a way to reduce America’s reliance on imported oil, combat rising gas prices, improve local air quality, and reduce greenhouse gas emissions. Nearly all automakers already have electric vechcles on the road, but to realize the full potential of electric vehciles, a broad range of stakeholders must work together.
The PEV Dialogue Group convened by C2ES brings together automakers, electric utilities, policymakers, environmental groups and others to develop consensus approaches to accelerate electric vehicle deployment nationwide.
National Enhanced Oil Recovery Initiative Participants
- Tom Altmeyer, Vice President, Government Affairs, Arch Coal, Inc.
- Jason Begger, Government Affairs Manager, Cloud Peak Energy, Inc.
- Dipka Bhambhani, Representative, Breitling Energy
- Mark Calmes, Vice President-Environmental, Archer Daniels Midland Co.
- Myra Crownover, Vice Chair, House Energy Resources Committee, Texas
- Pete DePasquale, Manager, Government Relations, Praxair, Inc.
- Paul Doucette, Global Leader, Public Policy and External Funding, GE Oil & Gas
- Mike Eggl, Senior Vice President, External Affairs, Basin Electric Power Cooperative
- Daniel Enderton, Director, External Affairs, C12 Energy
- Hal Fitch, Director, Michigan Geological Survey
- Richard Garrett, Energy and Legislative Advocate, Wyoming Outdoor Council
- Chris Geraghty, Director, Business Development, Linde, Clean Energy – North America
- Robert G. Hilton, Vice President, Power Technologies for Government Affairs, Alstom, Inc.
- N. Hunter Johnston, Counsel, Leucadia Energy
- Greg Kunkel, Vice President, Environmental Affairs, Tenaska Energy
- Rick Lancaster, Vice President, Generation, Great River Energy
- Dale Magnusson, Business Development and Intellectual Property Manager, LI-COR Biosciences
- Talina Mathews, Division Director, Kentucky Department for Energy Development and Independence
- Brad Markell, Executive Director, Industrial Union Council, AFL-CIO
- Dave Martin, Cabinet Secretary, New Mexico Energy, Minerals & Natural Resources Department
- Laura Miller, Director of Projects, Summit Power Group, LLC and former Mayor of Dallas
- Mark A. Northam, Director, School of Energy Resources, University of Wyoming, Enhanced Oil Recovery Institute
- Ellen O’Connell, Market Manager, Tonnage Gases, Equipment and Energy, Air Products, Inc.
- John Risch, Alternate National Legislative Director, United Transportation Union
- Doug Scott, Chair, Illinois Commerce Commission
- John Sherwell, Administrator, Power Plant Resource Program, Maryland Department of Natural Resources
- John Steelman, Climate Program Manager, Natural Resources Defense Council
- Samuel Thernstrom, Executive Director, Energy Innovation Reform Project
- Kurt Waltzer, Managing Director, Clean Air Task Force
- Thomas Weber, President, Jupiter Oxygen Corporation
- Kevin Macumber, Enhanced Oil Recovery Manager, Tellus Operating Group, LLC
- Robert Mannes, President, Core Energy, LLC
- Mike Smith, Executive Director, Interstate Oil and Gas Compact Commission
- Scott Wehner, Senior Vice President, EOR Operations, Chaparral Energy LLC
The Pew Center's September 2011 newsletter highlights a new intiative focused on expanding carbon dioxide enhanced oil recovery, a new brief on international climate assistance, the lessons we can learn from Hurrican Irene, and more.
“All kids growing up in this generation know how they’re impacting the environment. We’re teaching today’s kids about recycling and being responsible.”
- Shawn Kerr, eighth-grade science teacher at Alcoa Middle School in Alcoa, TN.
Fifteen schools participated in the Make an Impact: Change Our 2morrow (MAI CO2) schools’ challenge, an educational energy conservation competition led by the Center’s Make an Impact (MAI) initiative in partnership with Alcoa. Mr. Kerr’s words sum up the program’s outcome, in which Make an Impact, a corporate employee and community engagement program, expanded the reach of its energy efficiency message to middle and high schools in five Alcoa communities across four states this spring.
|Alcoa Middle School principle Jim Kirk holds up the $1,000 check that the school won for being named a regional runner-up in the MAI: CO2 schools’ challenge.|
We had high hopes for the MAI CO2 campaign, but our success at engaging a younger audience in acting on energy efficiency far exceeded our expectations. In one month, we reached more than 8,000 students/parents/teachers and motivated them to calculate their carbon footprint with the Make an Impact calculator. The program wasn’t just about students realizing their impact on the earth; we also tried to teach and empower these young individuals to make a difference – by saving energy, money, and the planet. Between March 14 and April 11, participants identified more than 14.4 million pounds of potential carbon savings and an estimated $1.75 million in energy savings.
In late 2010, we invited 68 companies to participate in a 27-question survey designed to gather key quantitative data, identify trends, and gauge current activities in low-carbon business innovation. Thirty-five companies, ranging in size from $600 million to $285 billion in annual revenues and with a median annual R&D expenditure of $575 million, completed the online questionnaire; the survey questions for the electric power and banking/financial services sectors were slightly different, to capture the unique characteristics of innovation and technology adoption in those sectors.
The survey’s principal objectives were to gather key quantitative information and gauge business strategies for low-carbon innovation activities, with a particular focus on how companies perceive the associated risks and uncertainties. It is one element of a broader Center study on the most effective methods used by companies today to develop and bring low-carbon technologies and solutions to market. The aggregated results will be combined with a set of four in-depth case studies in a report, Business of Innovating: Bringing Low-Carbon Solutions to Market, to be published in October 2011.
Highlights of Key Findings and Analysis
This survey highlights several interesting insights into corporate strategies for low-carbon innovation.
- Importance of Low-Carbon Innovation. According to the survey results, respondents believe that low-carbon innovation will only become more important for the growth of their companies and the U.S. economy as time passes, ranking (on a 10-point scale from least to greatest level of importance) the importance of low-carbon innovation to their business growth an average 7.5 over the next 5 years, an 8.2 over the next 10 years and an 8.7 over the next 20 years.
- Role of Public Policy. Respondents emphasized the need for long-term, transparent climate and energy policies as critical to establishing a business environment that would allow for greater certainty and stability for decision-making and investment in low-carbon innovations. Among the nine policy tools listed in the survey, putting a price on carbon was by far the most important action that respondents think the U.S. government could take to advance low-carbon innovation: nearly half (47%; 16 companies) chose establishing a carbon price while the second-most selected tool, with 4 responses, was establishing national low-carbon performance standards, for example, for fuels and/or electricity. Only one respondent believes that low-carbon innovation would be encouraged by the government getting out of the way or doing nothing. The absence of clear policy signals in the United States makes it difficult to anticipate and adapt to regulatory changes, derails low-carbon business innovation strategies or redirects them to markets with more policy certainty.
- Business Drivers. The survey results suggest that bringing low-carbon innovations to market is a strategic decision to enhance financial growth and respond to customer demand, and is less about the public relations benefits of promoting environmental solutions. All of the five drivers for pursuing low-carbon innovations listed in the survey ranked as important (in the 6.7 to 7.3 range) except for the reputational benefits of “going green” which ranked as only somewhat important to respondents (ranking an average 5.0). Financial growth, anticipating or shaping regulatory changes, establishing expertise in emerging technologies or markets, and current customer demand received approximately equal weighting—on average ranking 7.3, 7.2, 6.9, 6.7, respectively.
- Beliefs about Customer Adoption. Respondents believe that the most important factor for their customers’ adoption of new low-carbon innovations is the energy or total lifecycle cost reduction afforded by the solution (ranking an average 8.6). Moreover, companies find that customers look for solutions that have a lower total cost of ownership without compromising on the product's reliability or performance, suggesting that customer expectations are quite high when moving from a more traditional, energy-intensive solution to a low-carbon solution. Often, the customers want the new product to cost less and perform as well as, if not better, than the previous solution. Customer concerns about a product’s environmental performance (6.8) and an ability to have a distinctive competitive advantage (7.0) in their market also ranked on average relatively high as drivers for adoption.
- Risks and Uncertainties. Reflecting these survey findings about the importance of public policy and customer expectations to low-carbon innovation, the majority of respondents (65%) believe that the most significant uncertainty is policy (regulatory changes, tax/subsidy changes) and nearly one-quarter believe that market uncertainty (customer adoption, competing technological standards) is the most significant.
- Conducive Business Environments. Public policy also played a strong role in respondents’ beliefs about the country or region with the best business climate today for domestic low-carbon innovation. A large majority of respondents find that China and the European Union (EU) have the best overall business climate—representing 45.8% and 37.5% of the responses, respectively—primarily due to supportive government policies and, in China’s case, a strong domestic market. Some of the views on selecting China as the best environment for low-carbon innovation specified that, while the United States has the best business climate for low-carbon innovation, China has a stronger level of investment in low-carbon technologies and supporting public policies.
- Functional Expertise. Respondents believe that the CEO, Business Unit Leadership, Strategy, and R&D groups are relatively more important than other functions to be involved in all innovation, including low-carbon innovation. Perhaps not surprisingly, given findings about the importance of public policy to bringing low-carbon innovations to market, the companies believe that the Government Relations group is relatively more important for low-carbon innovation than for other types of business innovation. This finding suggests the need to better incorporate policy considerations, opportunities and challenges into the strategy and R&D activities within companies.