Tag Archives: Sustainability

Agriculture will be the most pressing issue of our time

Below is a great TED talk that brings some awareness to what seems will be the most pressing issue of our time (in 10-30 years) as it is the prime contributor to our rapid resource depletion and increased risk of cataclysmic climate change.

I feel that economics is best for sorting out this problem. How best to get others to eat less in the more developed nations when high food costs prohibit people’s decision to over-consume. The same could be said of high costs of oil and decreased driving habits. Many pricing distortions that the modern economies experience directly impact the relatively cheap pricing of food; specifically water, fuel, and choice of production. (corn subsidies)

Although as much as economics has a benefit, there is a cost. Producers will be focused on maximizing gains by irrationally increasing output. (a la tragedy of the commons) This will drive already poorly productive agricultural producers to expand their output into valuable biodiversity resources such as the rain-forest.

The best solution IMO, would be to end the developed worlds price distortions in combination with aggressive conservation policies for the developing world that would limit our total % of land used for agriculture and offer appropriate support to help current fertile land gains to reach 90-100% of its maximum productive capacity.

The two should limit over-consumption while also promoting increased productivity.

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Breakthrough Spotlight: Biofuel from microbial organisms

Unlike cellulosic ethanol made from foodstuffs and grasses, bio-fuel makers are on their way to creating a commercially viable bio-fuel made from microbial organisms. From Techpulse 360:

Now a third-generation of biofuel makers is showing progress with novel laboratory work. This new wave is a sharp departure from the ways of the past and has interesting potential. It hopes to simplify manufacturing by avoiding the fermentation step of first and second generation companies and convert organisms directly into fuel using just carbon dioxide and sometimes sunlight.

It is an exciting prospect. Not only could these new ventures remake an industry, they could open the door to new ways to store solar energy (in a fuel!) and help remove CO2 from the atmosphere.

Why is this a breakthrough relative to other bio-fuels? Most of it has to do with the ease of implementation within our existing infrastructure and limited burden on current resources.

Renewable sources of energy such as solar are geographically specific and currently, are unable to effectively store the energy on a large scale for that energy to be transported elsewhere.  While bio-fuels capture that energy from the sun and transforms into an effective storage vehicle that can be easily implemented with our current infrastructure, bio-fuels created from foodstuffs and grasses put a strain on available land and resources, usually translating into higher prices for food. Combine that with several production steps to create it, and you can see where bio-fuels become economically disadvantaged.

With microbial organisms such as these, the combined inputs of solar power and carbon dioxide add the benefit of reversing our carbon emissions. Add the fact that bio-fuel can already be easily implemented within our infrastructure and you can see why commercially viable bio-fuels from microbial organisms are a breakthrough.

The End of Cheap Coal

One of the reasons why the push for Cap and Trade was a good idea was it would not only internalize the cost of carbon emissions, but it would also raise the price of energy created from coal.   With higher prices for kilowatt per hour from coal energy, cleaner energy sources would become competitive.  Currently, cleaner energy sources can barely compete with coal, with exceptions of course.  But if legislation wasn’t going to push up the price of burning coal, then in the long-term, rising international demand would.  That time is now.

In 2009, China has ceased to export coal and has now began to import it.  According to the financial times, in 1993 the same happened to oil.  China’s oil imports exceeded what was being imported and the consequence was a climb in the average oil price, all too well known thanks to oil spiking at $150 a barrel in 2008.  China had been using more oil than it could produce in order to fuel its large amount of economic growth, and oil wasn’t the only commodity.

China isn’t the only player.  India as well as the emerging markets have offered its heavy share of the demand, tipping trade balances toward imports and helping to drive up commodity prices for oil and building materials.   The same is expected for coal.

This is good news for America, which contains the largest coal reserves in the world.  This is also good news for the coal industry, as it will be able to profit from an uptick in prices.

This is not so good for the coal power industry, especially in America.  While the coal industry will benefit in developing nations who have already increased the capacity to burn coal for energy and produce steel from coke, the developed world already faces pressures for pursuing greener technologies instead of burning coal.  And the coal power industry should be scared: the only thing keeping them from not succumbing to the powers of green energy is price, which is now soon to change.  With coal prices higher translating into higher per kilowatt hour energy costs that begin to be on par with greener technologies, the coal power industry will have a tough fight.

Green technologies already have the leg up of being green and renewable.  Obama’s recent moves to push for nuclear energy, which would already be competitive given Obama’s plan, and the ARRA’s subsidizing of renewable resources like wind and solar significantly put the government against the coal power industry.

The government’s backing of renewable energy certainly distorts what the market wants when providing energy, but a needed distortion nonetheless.  The only hope for the coal industry is to level the playing field by either removing green energy subsidies (not likely) or becoming green it self.  The industry’s only hope is going for clean coal. And now, it doesn’t have the luxury of waiting anymore.

Before one says that clean coal isn’t viable, I disagree.  It is possible, given recent developments in innvoation.  I blogged recently about Thomas Friedman’s catch about clean coal:

If you combine CO2 with seawater, or any kind of briny water, you produce CaCO3, calcium carbonate. That is not only the stuff of corals. It is also the same white, pasty goop that appears on your shower head from hard (calcium-rich) water. At its demonstration plant near Santa Cruz, Calif., Calera has developed a process that takes CO2 emissions from a coal- or gas-fired power plant and sprays seawater into it and naturally converts most of the CO2 into calcium carbonate, which is then spray-dried into cement or shaped into little pellets that can be used as concrete aggregates for building walls or highways — instead of letting the CO2 emissions go into the atmosphere and produce climate change.

If this can scale, it would eliminate the need for expensive carbon-sequestration facilities planned to be built alongside coal-fired power plants — and it might actually make the heretofore specious notion of “clean coal” a possibility.

With coal prices expected to rise, you can bet this will scale. With clean coal on the horizon, subsidizing greener technologies won’t be needed anymore or vice versa, coal won’t be dirty anymore. Either way, whether a Cap and Trade bill , favorable legislation towards green technologies or the sheer power of the market was going to force it, switching towards less CO2 intensive energy was inevitable. Now, about those mountain tops…

Recycle your cell-phone, its worth a fortune!

Here is why you shouldn’t just throw away your cell-phone, but recycle it! Some say to do it for the environment’s benefit. Save energy this, prevent waste that. But I think a true ecopreneur would look at this statement

For every 1 million cell phones recycled, 75 pounds of gold, 772 pounds of silver, 33 pounds of palladium and 35,274 pounds of copper are recovered.

That’s 75 pounds of Gold X 16 ounces X $1133.600 per ounce which = $1.35 million. 772 pounds of silver x 16 ounces x $18.1 per ounce = $223,571.  33 pounds of palladium x 16 ounces x $501 per ounce = $264,528.  35,274 pounds of copper per ounce x $3.5748 per ounce = $126.10

Total = $1.8 million dollars for every 1 million cell phones.

Yeah, OK, that only amounts to $1.80 per cell phone but imagine bringing economies to scale and legally require citizens to dispose of e-waste to specific collection centers and wallah! A viable business opportunity.  Don’t agree? Multiply $1.8 x 276.6 million cell phones in the U.S.  That’s around $500 million dollars in recycling revenue, and that is only from cell-phones! Imagine what other e-waste would yield…

PS:  $1.8 * 4.1 billion cell phones in the world = $7.4 billion. Yeah, that’s right. $7.4 billion dollars. For cell-phone e-waste alone. Is any CEO right now reading this?

Oh yeah, we get to save the environment too. Forgot to mention that.

Will Going Vegan Save the World? Maybe not

A study done by Helmi Risku-Norja and Sirpa Kurppa of MTT Agrifood Research Finland found that if everyone switched to being vegan , only eating fruits and vegetables, then the reduction of greenhouse gases would only be 7%.   So assuming this is true, anyone who is purely vegan for environmental reasons may be making a mistake.  More so is that in a game of dominant strategy, if you wanted to maximize your benefit of saving the planet vs. eating meat, you would need everyone to switch to vegan in order to get the small benefit.   But you can’t rely on everyone to do that.  Since meat is so tasty, the benefit of eating meat certainly outweighs the decision to go vegan.  Unless of course you went vegan for other reasons, such as health (arguable) or ethics.

Of course this game assumes the conclusions are true.  I am of course skeptical of this study, and since I can’t read it, I really can’t say for sure.  But, the article helps illustrate their point: (emphasis mine)

The team explains that for current average food consumption, in Finland, emissions from soil represent 62% of the total emissions. Greenhouses gases released by cows and sheep account for 24%, and energy consumption and fertiliser manufacture about 8% each. The greenhouse emissions performance for extensive organic production is poor, they explain, despite this approach to farming being considered the “green” option, the lower efficiency requires the cultivation of greater areas of soil, which counteracts many of the benefits.

That’s an interesting argument. Non-organic farming does produce more yield per acre. However, here is my issue. 1. This is in Finland, drastically different than elsewhere, especially the United States. I can speculate on their food consumption habits being less turf and more surf. 2. What “greenhouse gases” were they measuring? What raised my eyebrow was that meat emissions were only 24% and the article only listed cows and sheep. Isn’t methane worse? Is methane generated from the extra amount of land needed for organic farming? Either the Finnish (is that right?) don’t eat enough cows and sheep compared to the United States, or I have underestimated the amount of greenhouse gases created from an acreage of farmland. Statistics are not easily available to compare, making these conclusions immediately suspect.

HT: Free Market Mojo

Upcycling: Another name for the waste product aftermarket?

I stumbled upon this well put together blog, Intercon, and came upon this post entitled Recycling vs. Upcycling: What is the difference? In the post, the author defines upcycling as:

process that can be repeated in perpetuity of returning materials back to a pliable, usable form without degradation to their latent value—moving resources back up the supply chain.

Sounds a little bit like a term I coined called the “waste product aftermarket.”  The waste product aftermarket is an idea that I have a few kinks to work out, – I haven’t been able to muster up any formal definition for it – (watch out grad school) but I find many similarities with this author’s proposition for the concept.  My aim here is to flesh out the differences between the two.

Both are similar in that they define a concept often used in sustainability – about closing the link between the industrial supply chain’s input beginning to its waste end.  In ecological economics terms, this is a function of industrial ecology where resource inputs that will have value added to them also have waste outputs all along the product lifecycle.  Traditional industrial production models are linear based and describe the waste outputs (which add no value to the supply chain) as externalities.  However, in an industrial ecological production model, instead of waste being an externality, it is a valuable resource that, with value added such as recycling, could then become a resource input to begin another product life cycle again.  This idea assumes sustainability because the production cycle becomes a closed loop system where new resources entering the system are not used and then wasted, they are simply reused over and over.  The benefit of this? Less environmental damage from the front end and the back end.

But lets get back the difference between the definitions.  The waste product aftermarket is the actual market where suppliers (those who generate the waste whether its industry or consumers) meet with buyers. (those who add value to the waste, like recyclers)  The buyers then sell their newly reused product and either contract out their products (or put on a commodities market) as inputs for beginning the new product cycle.  Like any market, profit maximization is the key guide here.  While this isn’t a concrete definition, (this is just a blog after all) I hope this makes my ideas a little clearer.

What upcycling to me is the process of waste reaching an intermediary in the waste product aftermarket which can then be created into a usable form.   For now on, I will continue to use this definition to explain this particular process.  To understand more about the waste product aftermarket, you will just have to read my blog more!

Clean coal finally a reality without the expense?

Instead of pumping C02 into the ground we can just mix it with seawater to create something that resembles coral, a substance that is harmless to the earth and and can be useful for creating building materials. From Thomas Friedman:

If you combine CO2 with seawater, or any kind of briny water, you produce CaCO3, calcium carbonate. That is not only the stuff of corals. It is also the same white, pasty goop that appears on your shower head from hard (calcium-rich) water. At its demonstration plant near Santa Cruz, Calif., Calera has developed a process that takes CO2 emissions from a coal- or gas-fired power plant and sprays seawater into it and naturally converts most of the CO2 into calcium carbonate, which is then spray-dried into cement or shaped into little pellets that can be used as concrete aggregates for building walls or highways — instead of letting the CO2 emissions go into the atmosphere and produce climate change.

If this can scale, it would eliminate the need for expensive carbon-sequestration facilities planned to be built alongside coal-fired power plants — and it might actually make the heretofore specious notion of “clean coal” a possibility.

Assuming it is scientifically possible and economically viable:

– Reduced demand for conglomerates used in concrete lessens environmental damage from rock quarries (assuming coal plants produce this coral cheaply) and reduces holes in mountains

– Increased demand for coal provides incentive for finding cheap coal by using cheaper extraction processes, leading to blowing up mountains for it and increases holes in mountains

Oh well, less carbon is still a pareto efficient outcome in my book.  Maybe in a quest for economies of scale, coal plants can start to diversify their carbon sequestration technologies from creating building materials to providing C02 in my soda.*  Mmmmm…coal’d soda…

HT: Environmental Economics

*I think the industry already does this but I could be wrong…