The Charcoal Project

In a meeting this week with the folks from Acumen Fund, we were asked what was holding up the large-scale deployment of improved cookstove worldwide?

After all, at 2.5 to 3 billion people, the market for clean technology and sustainable alternative biomass briquettes is huge and set to grow. And the technology is pretty much there, too, compared to, say, carbon capture or designing a car battery that last more than a few hundred miles.

Plus, the advantages delivered by clean burning stoves add up to substantial savings and benefits to households, society, and the planet, which is probably why they call improved cookstoves the “low-hanging fruit” for carbon emissions reduction/indoor air pollution/poverty alleviation/and ecosystem-services-and-biodiversity-protection.

Acumen says they’ve been looking at investing in cookstove projects for years but they can’t make them work from their “patient capital” investment perspective.

So what’s the holdup?

The truth is there is no simple answer.

For one, the chicken-and-egg situation seems to apply: lack of adequate capital investment in manufactured stove companies and products keep unit prices too high to prime the demand pump. (Yes, even if the stoves are inexpensively manufactured in China.) Add to that shipping and import duties and the price rockets from, say, $10/unit FOB to $20 or more.

This means that tariff barriers on clean cookstove technology must be eliminated in favor of strong national and international policies supporting manufacturing and deployment.

Many, including us, have argued that securing funding from carbon credits sold from cookstove projects around the world is vital to sustaining and growing their deployment. But consider the challenge of selling carbon credits generated by improved cookstove offsets in the absence of efficiency and emissions standards, as Aprovecho’s Dean Still pointed out to us in a recent interview. 

What’s more, uncertainty about the future of the carbon credit market does little to inspire investments that depend on the sale of carbon offsets from cookstove projects. It’s nice to make projections when Certified Emissions Reduction (CERs) credits sell for almost $30 (Dec.2008) but things don’t look as attractive when they’re worth only $15 (today).

Social marketing is another important factor. Just because the stove cuts down on emissions and smoke doesn’t mean people will rush out to buy it. Cell phones are different. Buying and using a cell phone is cheap compared to getting a land line in a developing country. Plus, there are no viable alternatives to personal telecoms, whereas three-stones + a pot + cow patties = tried and true technology.

Add to the mix a well-intentioned but disorganized stoving community, a handful of international development agencies with their own agendas, and no shared script among stakeholders and the prospects of large-scale deployment of improved cookstoves starts receding even more.

Through the twitter transom today came the beginning of the answer. It arrived from McKinsey & Co. via the Aspen Network of Development Entrepreneurs (@aspenande.) The McKinsey article, by Raj Kumar, titled Social Enterprise: It Takes A Network, is definitely worth a read.

Here’s the essence:

“…how can social enterprises maximize their impact without having to achieve the financial scale that would make them major players in whole sectors of the economy? The answer lies in networks. Where one social enterprise may be limited in the impact it can have, a network of social enterprises can create opportunities for substantial financial scale and impact.

Those social enterprises that focus on the most difficult markets, often through bottom-of-the-pyramid business models, can use networks to share technology, jointly produce goods and services that meet tough environmental and social standards, and purchase fair-trade inputs as a group—effectively getting the value of a larger enterprise while remaining a focused social enterprise. This can help individual social enterprises to compete against bigger businesses that have lower cost structures due to economies of scale.

Social enterprises can also use networks to educate consumers and set market standards. Where meeting high environmental and labor standards may entail greater costs for social enterprises, through networks these groups can work together to educate consumers about the difference between their products and those offered (possibly at lower prices) by other businesses. In the United Kingdom, the Social Enterprise Mark is a brand used to identify social businesses so that consumers who want to support social and environmental goals know which products and services to favor. The mark also connects these social businesses to each other and to social-enterprise networks throughout the country.

Finally, networks can also be effective in lobbying government and regulatory agencies to create a social enterprise-friendly business environment. The business and NGO communities use networks (often called trade associations in these cases) for precisely this reason, influencing tax policies and regulations that benefit their form of organization. Social enterprises, given their relative small size, will have to work together if they hope to sway government to support them as a group distinct from traditional for-profit and non-profit enterprises.

“… those who wish to scale social impact would do well to focus on supporting robust networks—essentially the infrastructure of the social-enterprise industry—in addition to individual social entrepreneurs. In time, the social-enterprise community may find that measuring scale and impact at the network level (rather than at the level of the individual enterprise) is a more accurate measure of the true scale of social change and a better way for investors to gauge the return on their social investment.”

Whatever your thoughts are about taking directions from large management consulting services used to serving multinational corporations, there are good ideas worth considering in this free advice.

This is why on our to-do list for tomorrow is fortifying the network of global stakeholders who share the goal of making improved cookstove technology and better fuels more easily available to our world’s energy poor.

OPINION

We almost choked on our first Red Bull of the day when we opened up our social media apps and stumbled upon this tweet.

How could we possibly not be excited by the influential David Roberts (Grist) tweeting about the UNDP’s call for greater attention to alleviating energy poverty as a key strategy to achieve the MDGs?

But, like a puzzled puppy who’s favorite chew bone has been taken away for no reason, we were disappointed by what we read when we clicked on the link: it was yet another lofty paragraph written in “development-ese” leading to a bunch of UN reports about how important energy poverty relief is to achieving the MDGs.

Hey, folks at the UNDP, a list of reports does little to sway policy-makers and public opinion.

To really move the needle on this issue we need a coordinated marketing, communications, and advocacy strategy that will engage public opinion and decision makers.

At The Charcoal Project we think a window for action will soon open up when the US Congress takes up discussion on a national energy (and climate change?) bill later this summer. This will be the time to lobby key Congressmen and Congresswomen to include language and funding that will address energy poverty alleviation beyond the borders of the US.

As we’ve written before on this blog, energy obesity and energy hunger are two sides of the same coin. What’s more, the technological and policy solutions exist, are proven, and require very little funding compared to, say, developing carbon capture from coal power plants (CCS), or a hydrogen economy.

This upcoming debate is a great opportunity for Ms. Helen Clark, the UNDP’s administrator and the first woman to ever run the agency, to load the bus to Washington with  some of the UNDP’s Goodwill Ambassador like Lebron James, Didier Drogba, Ronaldo, Maria Sharapova, and Antonio Banderas, and tell the folks in Congress how important the issue is and how easy and inexpensive it would be to make a huge impact on the 3 billion people who are still using caveman technology and fuels for their primary energy.

We think Zorro is the man to take on energy poverty alleviation.

OPINION

Bill Gates last week joined the CEOs of GE, Bank of America, Xerox, Lockheed Martin, and others, in calling on the United States to modernize its energy systems with investments in cleaner, more energy efficient technologies.

With Europe and China eating corporate America’s energy innovation lunch, I, too, would be a worried CEO if I saw my country giving up the lead in the driver of all future global economic growth.

What seemed especially ironic is how the group’s exhortation could easily have come from the top CEOs of companies based in developing countries.

Listen to this:

“As business leaders, we feel that America’s (substitute the Global South, Developing World, or whatever you choose to call it) current energy system is deficient in ways that cause serious harm to our economy, our national security, and our environment. To correct these deficiencies, we must make a serious commitment to modernizing our energy system with cleaner, more efficient technologies.

Of course, the irony here is that industrialized societies and the climate change movement are adamant about not funding more coal fired power plants to meet the energy needs of developing countries. But that’s another story we’ve blogged about before, so let’s not go there now.

Quoting from their manifesto, the CEOs remind us that to “continue with the energy status quo, we will expose ourselves to risks that pose significant threats to our way of life.”

Alas, this is already the state of affairs for those who depend on biomass for their primary energy.  The irony of course is that the solutions exist, are inexpensive, and can be rapidly deployed to the great benefit of all, not just the energy poor.

While The Charcoal Project couldn’t be more supportive of this call to arms by America’s top managers, we hope they will also recognize the importance of promoting clean energy and improved fuels for the world’s 3 billion energy poor who are still burning biomass using 10,000 year old technology. 

Kim

The upcoming G8 & G20 summit in Huntsville, Canada, makes this the perfect time to write about a topic somewhat neglected by our blog recently: biochar.

Bring it on Climate Change!

So what is this thing they call biochar, you ask? It’s been described as the Swiss Army knife, or the “killer app” of climate solutions.

Stephen J Dodds, Professor of Control Engineering at the University of East London, gives us a clue.

Biochar is a 2,000 year-old practice that converts agricultural waste into a soil enhancer that can hold carbon, boost food security and discourage deforestation. The process creates a fine-grained, highly porous charcoal that helps soils retain nutrients and water.

Biochar can be an important tool to increase food security and cropland diversity in areas with severely depleted soils, scarce organic resources, and inadequate water and chemical fertilizer supplies.

Biochar also improves water quality and quantity by increasing soil retention of nutrients and agrochemicals for plant and crop utilization. More nutrients stay in the soil instead of leaching into groundwater and causing pollution.

The carbon in biochar resists degradation and can hold carbon in soils for hundreds to thousands of years. Biochar is produced through pyrolysis or gasification — processes that heat biomass in the absence (or under reduction) of oxygen.

My note: biochar is an important byproduct of the good combustion in certain improved cookstoves, like WorldStove’s Lucia stove, among others.

The Lucia stove is so cute we want to pinch its handles!

In addition to creating a soil enhancer, sustainable biochar practices can produce oil and gas byproducts that can be used as fuel, providing clean, renewable energy. When the biochar is buried in the ground as a soil enhancer, the system combats climate change by becoming “carbon negative.”

We can use this simple, yet powerful, technology to store 2.2 gigatons of carbon annually by 2050. It’s one of the few technologies that is relatively inexpensive, widely applicable, and quickly scalable. We really can’t afford not to pursue it. To put 2.2 gigatons in context, that’s the amount of CO2 produced by China in 1990. Today it emits 6.1 gigatons.

Thank you, Professor!

Ok, you say, but what does this have to do with a bunch of suits meeting in a remote town in Canada’s interior?

We all know that these periodic meetings of the club of wealthiest nations produce a lot of hot air… Oops… I meant, C02 emissions.

Now, a group calling itself the Huntsville Project is trying to get every summit delegation to offset its C02 emissions by investing in biochar projects around the world. (Plus, who really wants to invest in a methane digester? And offsetting with reforestation is sooooooo last summit.)

The simplicity of the idea is one reason why this just might happen.

Here’s how it works:

1. A country chooses from a global list of ongoing and planned biochar projects for their offsets.

2. The money is collected in a global Biochar Climate Mitigation Fund. Biochar entrepreneurs will then use microcredit for affordable finance to start New Carbon Economy biochar projects.

3. The Biochar Climate Mitigation Fund will be operated by a foundation with the highest levels of accountability, oversight and transparency

The challenge now — and the real reason why we’re writing about this — is that the Huntsville Project must get Canada and every delegation attending the June 25 – 27 summit on board. We think this is a good idea because it will bring some much needed attention to biochar as an potentially critical solution to real carbon sequestration, food security, clean water, and many other challenges.

Do your part by signing the petition asking Canada and visiting delegations to offset their carbon footprint with biochar!

Visit http://www.newcarboneconomy.info/