Global warming doomsayers may have taken an ironic satisfaction from the fact that the cocktail reception and exhibition at the recent 4th Annual Mid-Atlantic Cleantech Investment Forum was held in the dinosaur hall at the Academy of Natural Sciences of Drexel University in Philadelphia. In their view, the mass extinction of the dinosaurs offers a preview of their apocalyptic vision for the destiny of humankind if we don’t take strong steps to prevent man-made global warming from overheating the Earth.
Under the shadows of more than a dozen full skeletal mounts of Cretaceous-era titans such as Tyrannosaurus rex and Corythosaurus casuarius, or duckbill dinosaur, the conference participants munched on hors d’oeuvres and traded notes on what they were doing to prevent such a fate.
The reception followed a conference focused on clean tech opportunities and challenges in the mid-Atlantic region that included panels on “fostering clean tech investment” and shale gas development, the latter being only fitting since most of Pennsylvania is covered by the Marcellus Shale Formation, the world’s third largest reserve of natural gas. The panels were followed by a cleantech showcase highlighting companies involved in enterprises as diverse as OmniWind’s wind turbines and Primus Green Energy’s technology to transform biomass and natural gas into a high octane, drop-in gasoline.
But if the conference were to be distilled down to a single idea, it would be energy efficiency, which was the theme of keynote speaker Mark Fulton, the managing director and global head of Climate Change Investment, Research & Strategy for Deutsche Bank Climate Change Advisors. While politicians may still be debating the existence of climate change, investors at financial institutions such as Deutsche Bank are planning how to deal with it. Fulton coordinates a team of analysts who publish white papers on key industry, policy and strategic topics that are used to advise investment managers on climate change-based strategies across their asset management platforms.
Drawing on a research study conducted by Deutsche Bank Climate Change Advisors and the Rockefeller Foundation (http://www.rockefellerfoundation.org/news/publications/united-states-building-energy-efficiency), Fulton said that proven technologies to retrofit buildings — from upgrading lights to replacing heating and cooling systems and building controls — can both conserve energy and create a large number of jobs. He noted that buildings consume about 40 percent of the world’s energy and are responsible for 40 percent of global carbon emissions. According to the study, an investment of $279 billion in the residential, commercial and institutional energy efficiency market segments could yield more than $1 trillion of energy savings over 10 years, which would be the equivalent of saving approximately 30 percent of the annual electricity spend of the United States. Perhaps more importantly — at least from a climate change perspective — the retrofits represented by such an investment would reduce greenhouse gas emissions in the United States by nearly 10 percent.
But the report also noted that, despite the market potential and rapid payback of energy efficiency upgrades and retrofits, this “low-hanging fruit” in the energy and climate space has consistently proven to be farther out of reach than expected. In his address, Fulton profiled various financing models with the potential to scale investment in these markets and to overcome supply- and demand-side barriers. He concluded that the Energy Services Agreement (ESA) model holds the most promise for the near term, given its potential to scale without the need for policy initiatives or regulatory changes. Under such a model, the lender funds the costs of improvements and assumes responsibility for the payment of the energy bill. The property owner is then charged back based on historic consumption, thus allowing the lender to capture the energy savings. For more on the benefits and drawbacks of the various financing models, please consult the report.
We hope that the climate change prophets of doom, many of whom say we have only a few years left until we lose the levers of control, are wrong. But if we are well on our way to environmental annihilation, as the zealots aver, learning to control the carbon emissions produced by the built environment, while not especially glamorous, would seem like an eminently sensible way in which to forestall catastrophe while we are waiting for those magic bullet technologies that the optimists predict are on the horizon.
- Stefanie Matteson