Feb 12 2009
It’s All About the Carbon
Last week I had the opportunity to be a member of the faculty for the Practising Law Institute’s “Green Technology Law and Business 2009” conference in New York City. Following are some of the highlights of the day:
Carbon is the new buzzword. Presentations on carbon made the quiet audience lively, whether it was about developing a carbon strategy, how to interpret and accommodate global regulations, or discussions about the carbon markets and trading. This is a nascent area, but there were plenty of people in this group who have already developed significant expertise, and this seemed to be true of both audience and presenters. There’s no question that carbon trading is going to be big, big business. Estimates for the 2008 carbon markets globally were $100B. That’s estimated to be $150B in 2009 and a trillion by 2020. Between the Carbon Disclosure Project’s efforts to develop reporting, and the confluence of cap & trade advocates now in Washington, this year and the next look to be the tipping point.
A pithy comment from Bill Sloan, Morrison & Foerster made a lot of sense to me: “When developing a carbon strategy…think like the regulators…but don’t wait for the regulators.” By this he meant that companies trying to define their strategies should put themselves in the shoes of the regulators, in order to understand the issues that they are dealing with and prioritizing. He suggested that companies waiting for the regulations to be sorted out will leave a company well behind the curve. I agree with this analysis. There’s a fine line between being proactive and reactive and anticipating what’s to come—acting accordingly is what creates leadership.
Other themes and predictions that emerged in this one-day conference dealt with green IT, and the cost-saving technologies that can reduce carbon footprint, including strategies of re-use, and remanufacturing of components. The notion of adapting DOE and EPA assessment tools to the private sector got some airplay. Water is seen an underserved, under-valued opportunity that will emerge in the next year or two. And finally, it’s clear that 2009 will be the year of energy efficiency.
The day’s first presenter was Peter Hebert of Lux Research, who swiftly and articulately energized the group with data, predictions, and a few opinions that generated some buzz. One was his idea that because human behavior can’t be changed, conservation of energy must be managed through artificial means—such as technology and tools that create energy efficiency. I couldn’t disagree more with this position, having watched the emergence of all kinds of behavior changes in the last year. For sure, technology is the enabler. And for sure, behavior alone will not create the scale we need to reach. But it’s going to take both, and in creative combinations, to truly create change in the timeframe we need it.
Hebert also posited that oversupply in the solar industry (particularly PV) will drive costs down and drive the marginal players out. A competitive business climate would do that anyway, I believe, but I agree with him that this economic climate is likely to hasten that process. His research and the opinions that went with them were a great way to start the day. An opportunity to discuss and debate these would have really made things fun.
This day’s content will be reprised in San Francisco on February 23, at PLI’s headquarters, and I’ll be part of a panel discussing corporate green technology policies. For more information, visit PLI’s website.