Carbon offsetting: What is it about & who/what benefits?

We have all heard about the concept of carbon offsetting.  The smaller, voluntary markets such as airlines use it to reduce their carbon footprint as well as numerous other industries such as leisure, manufacturing and even financial institutions.  In 2008 $705 million was purchased in carbon offsets in this smaller market which equates to 123.4 million metric tons of CO₂e reductions.  In the larger compliance market, companies, governments, or other entities buy carbon offsets in order to comply with caps on the total amount of carbon dioxide they are allowed to emit. This market exists in order to achieve compliance with obligations under the Kyoto Protocol, and of liable entities under the EU Emission Trading Scheme. In 2006, about $5.5 billion of carbon offsets were purchased in the compliance market, representing about 1.6 billion metric tons of CO₂e reductions.

As we can see, this is big business with many 'carbon offsetting' companies trying to get a slice of the pie.  I even saw this in a hotel we stayed at this weekend.  A company issued them a certificate stating that they were carbon neutral due to all the carbon offsets (I cannot remember how many metric tons of CO₂₎ purchased by the leisure company.  But what is purchased and how does this result in offsetting your carbon emissions?  If one goes to Wikipedia or even Google, the variation of articles on 'carbon offsetting' is a minefield.  But is it a good concept or just a sell out? 

Here is my view:
One of the articles compares it to 'Indulgences' that the Roman Catholic Church sold in penance of ones sins a few centuries ago.  So this being said, an organisation can rack up those carbon emissions and just cap and trade carbon offsets to be forgiven.  I then become very sceptical of this concept...but, if we didn't have this at all?

I view the problem of carbon offsetting as seeing only one angle and not looking at the whole picture.  Big picture thinking is required for this problem of carbon emissions and climate change as it is one big connected system.  Can we not look at the principles of Sustainability (systemic, cyclical, all inputs and outputs, all impacts) to create a more balanced solution?

For this blog I will use the airline industry for a few insights:

• An aircraft is made from a myriad of raw and processed materials.  So looking at the entire supply chain from rare earths for the electronic equipment to the carbon fibre in the wings and the aluminium for the fuselage, the entire supply chain can get pretty complex!  Solution: recycled materials, choosing suppliers with minimum environmental impact and large social impact (skilling up PDI's).

• Then the fuel: Jet-A and Avgas is processed from brent crude oil and has many additives which contribute significantly to climate change, especially so because planes fly higher in the stratosphere this has other non-CO2 impacts.  To go even wider, the ground airport vehicles, and those used by passengers and staff to access airports.  Solution: biofuels (however a contentious issue which affects food security), Swift fuel, more efficient aircraft engines, electrifying the nosewheel, using hybrid or electrical ground vehicles, using turboprop aircraft for short haul flights etc........the list can be endless.

• The airport buildings and the emissions generated by the production of energy used in airport buildings and the construction of airport infrastructure.  Solution: green building design, use of renewable energy, recycling air and water.

These are just ideas where the technology already exists.  I'm sure there are other blue sky ideas which can totally transform any industry but cannot be immediately implemented.  Even with existing technology, it's the business case and investment therein that puts on the brakes to the actual implementation.

So in conclusion, who benefits from the 'carbon offsetting' approach?  Like true capitalism only the few.....
Let's consider a more systemic approach and not one size fits all which takes each organisation, country and entity into account with individual processes/requirements and propose solutions from there.  I definitely think that the 'carbon offsetting' concept will still play a part, BUT not the only part of the bigger solution.

The future of water and how Sasol has become a leader in water sustainability.

The future of water and how Sasol has become a leader in water sustainability.

Well done Sasol!!
Sasol has recently completed a project in partnership with General Electric.
This new water technology plant cleans waste water and supplies biogas as a byproduct for power generation.  A very progressive technology that is based on the concepts of 'The Blue Economy'  (no waste, ecosystem cycle, cascading nutrients)

Known as Anaerobic Membrane Bioreactor Technology (AnMBR), the new technology will be further developed as a demonstration plant at Sasol’s research and development campus at Sasol One Site in Sasolburg.  This new water treatment plant involves cleaning the waste water
which contains organics generated from Sasol's operations via GE's ecomagination qualified ZeeWeed 500 membrane.  These organics have proven to be the ideal food, or substrate, for anaerobic micro-organisms.  This new technology will be commercialized at all Sasol GTL and CTL plants by 2015.   

Waste water from the GTL (Gas to Liquid - conversion of natural gas to liquid petroleum products) and CTL (Coal to Liquid - coal liquefaction to produce petroleum-like synthetic crude oil) plants will treated and can be used again elsewhere.  This maximises the efficiency of these plants and addresses the water scarcity problem we have in South Africa and globally. This water scarcity problem has a direct negative impact on the economy and on all Sasol operations worldwide as most of the Sasol plants are in water scarce regions.  So this step taken by Sasol is a breakthrough!

What is AnMBR all about?  Well what I could gather from the different articles published is that it involves anaerobic micro-organisms that are able to live in an environment devoid of oxygen such as sediment layers on floors of lakes, dams and the ocean.  These micro-organisms reside on the membrane and extract and process the organics passing through. Currently Sasol  uses aerobic and anearobic microbes to treat GTL and CTL effluents in Qatar and Secunda, but without the membrane technology. The next step is the development of AMBR (aerobic membrane bioreactor technology) for a GTL plant in the US.

The new AnMBR technology is one of the many solutions that can be applied in the petrochemical and refining environment and also benefit other industries in treating waste water.  


.
The possibilities of using this technology in industries worldwide are endless!  In my opinion a great step forward for re-using industrial waste in large processing industries.

Sustainability means Business: Unilever and Net Impact

UCT Graduate School of Business: Sustainability at the heart of Business 
www.gsb.uct.ac.za

On 12 November 2013 I attended a talk about how Sustainability can be incorporated into the day to day operations and strategy of a business.  Net Impact @netimpact in partnership with Unilever have set up a programme for intrapreneurs in established companies to make a difference around the ethical triple bottom line (environment, society, economy).  The talks were powerful and inspirational and included speakers from Unilever, Woolworths and Reel Gardening.  It illustrated the steps these pioneers are taking in incorporating sustainability into their cultures and business models.  I will discuss the Unilever and Woolworths presentations.

James Inglesby from Unilever is an intrapreneur who has started a sanitation project in Ghana.  Portable toilets are bought by urban dwellers and then serviced on a regular basis.  This solves a great need for sanitation in developing countries (solves waste and disease issues) and also aligns with Unilever's business model of creating a bigger market for toilet disinfectants & cleaners.  The toilet was designed by +IDEO to accommodate the needs of the dwellings in urban Ghana.  As can be seen through the ages, Western technology does not always work in other settings.  This Clean Team project in Unilever was done in partnership with NGO WSUP  (Water and Sanitation for the Urban Poor) so that their knowledge of the sanitation issues can be shared for best implementation.  James shared some pointers that helped him on this journey.  What I could gather is the new CEO of Unilever Paul Polman is a champion of sustainability in business and has led the movement in Unilever of "Make Sustainable Living Commonplace".  The implementation of the USLP (Unilever Sustainable Living Plan) which each employee applies daily is driven by the Brand and Communications teams.  An inspirational story of how one's values and principles can be aligned to your corporate business model.

Justin Smith from Woolworths drives the sustainability model currently in practice.  Woolies has won Sustainable Retailer of the Year for 4 + years since 2007.  The key salient points I took away from this and which could be applied to any industry looking to start a sustainability journey were as follows:

1. Understand the key impacts of your sector.  What are the environmental/social impacts?
2. Senior leadership buy in.  This is extremely important because if the FD does not see a business case or the CEO does not see the ethics behind the movement, nothing will get started.
3. Research/bench marking/context.  How can this work and what must be changed.
4. Measurement & Integration.  Make sustainability quantifiable and report on benchmarks.  The transition from soft issue to hard evidence will be made.
5. Relationship sustainability and innovation.  Innovation in all divisions to take concept forward.
6. Stakeholders and Partnerships.  Maintain strong relationships and partnerships along entire supply chain.  Create symbiosis between partners (WWF and NGO's in Woolies case).
7. Clarity on Business Case.  From the results of the measurements and integration, give it a Rand value.  How much is saved? Are sales up? Is productivity up?  Woolies has attracted investment from entities who want to invest responsibly (PRI) and this has tripled in the last few years.

I asked two questions after the presentation:

• How does Woolies measure Sustainability targets and report there on?  MS Excell spreadsheets were used initially as there were no software packages available.  This solution has been expanded to a custom bespoke package used by everyone and works for the company.
• Senior level buy in is the make or break of Sustainability take on.  What steps were used to ensure this?  Lots of change management was used and the biggest impact was when HR incorporated these KPI's into each employee's scorecard.  It really then became part of the company culture and now Woolies attracts recruits with these values and ethics which builds the brand even further.

Thank you to the UCT Graduate School of Business for organising the event.  A truly informative and practical session.

The possible Industrial Symbiosis between the sugar and paper processing industries in South Africa

The possible Industrial Symbiosis between the sugar and paper processing industries.

For many who have read the book 'The Blue Economy' by Gunter Pauli, the industry solutions mentioned make incredible sense.  Many industries are discussed, specifically on how their waste can be used very efficiently in other industries who use it as a process input.  One example that caught my eye was the sugar industry.  The sugar extracted is only 10-15% of the total cane biomass.  This waste called bargasse (90% of plant )  is burnt as waste after sugar is extracted.  At the Transvaal Sugar Board, they use the thousands of tons of bargasse as a source of fuel by burning it to contribute to the electricity required to run the processing plants and mills http://www.tsb.co.za//environment.cfm#.Un9A83Bmim4.  So instead of using coal they use their own waste material and even have an independent power purchase agreement with Eskom to supply electricity to the national grid.  But, in the burning process it is only the lignin that supplies the heat and energy.  The rest which is composed of hemicellulose and cellulose creates massive carbon emissions when burned, because these substances incinerate without contributing useful heat.  Can the bargasse then not be better used in the paper processing industry to make paper products?

The paper industry is currently and historically only using pine and eucalyptus trees as input to the paper making process.  Vast swathes of pine and other tree plantations cover various sections of South Africa and since only the cellulose content of the entire tree is used to make the pulp for paper, the remaining 70-80% of the tree is wasted (what is done with this waste?).  Sugar cane, in terms of fibre, tops the volume of produced by trees in our climate (temperate).  So the logical outcome: should the sugar and paper industries not work together on perhaps using the other's waste?  Both industries are concentrated in the eastern part of South Africa, so transport costs should be minimal.  Worth considering......but with a certain turn around on each industries current business model.

As is put forward in The Blue Economy +TheBlueEconomy,  industry should work like an ecosystem and as everyone knows: in nature nothing is wasted and there is always a cascading of nutrients.  Waste output from industry is a massive problem globally so this is a key priority going forward.  There are many other industries where waste accounts for a huge percentage of the entire process: the beer industry (SAB and use of clay), the coffee industry (99.8% of total biomass is waste).  GreenCape, an NGO in Cape Town, has just acquired software from a UK based company to determine the 'Industrial Symbiosis' between industries.  So this field can expand substantially within the next few years in this country.

Why is SAP Sustainability Reporting not getting industry penetration?
With all the world's industries moving to incorporating sustainability concepts into their organizations, it makes total sense to develop an off the shelf software package to assist in monitoring energy/water and other resource usage.  As MBA grads and students tout: if you can measure it you can manage it!
Organizations can therefore save on operational costs for resource usage and any waste along the product life cycle through implementation of turnaround strategies and process re-engineering.

BUT, to my astonishment there has been very limited uptake of these management information systems.  I will focus on one specifically as there are numerous resource monitoring tools.

For companies that already have SAP implemented as an enterprise resource planning software tool it should be a no brainer to purchase this add on to the traditional EH&S module  (Environmental, Health & Safety).  However the first of the problems is not the tool but the DATA.  Meters need to be installed almost everywhere to gather this data (in the case of mines, dam levels are estimated) and the risk of damage and theft is high.  People need to be employed to monitor the meters and ensure data is correct.  All this data needs to be consolidated and stored on a server.  Would the FD be able to make a business case to take on all this cost to save an unknown amount of money for the organization?  In the current economic times and in South Africa I think the priorities are elsewhere.....

Sustainability reporting and incorporating these concepts into the overall financial reporting of companies is still a long way off in South Africa.  How can we turn this around so that management and boards of directors can see the benefit?

An Introduction to The Blue Engineer

This is my first blog for a different kind of engineering which has come to life for me.  We are all accustomed to the traditional engineering disciplines where design, problem solving and execution follows the same pattern.  Ideas have become so entrenched as to how to do things and how to create things that even engineers don't consider a total turn around of the status quo.

This blog will touch on a few concepts and how we can do things differently by incorporating the green, sustainability elements as well as being economically viable.  A consolidation of a great deal of my research and readings on how the 'Blue engineer' can come to be in the industry.