Читать книгу 75 Green Businesses You Can Start to Make Money and Make a Difference - Glenn Croston - Страница 7
ОглавлениеCHAPTER 1
Fueling Green Energy
We need energy and lots of it. According to the 2003 book by Vijay Vaitheeswaran (Power to the People), the global energy business totals more than $2 trillion a year (yes, that’s trillion), and as the economy of the developing world grows rapidly, the global appetite for energy could increase another 50 percent by 2030 (International Energy Agency, World Energy Outlook, 2006). Mitigation of climate change is an important factor shaping public policy and the energy market, and is creating vast opportunities for fledgling energy companies to provide renewable, clean energy. With oil soaring to more than $120 per barrel and rising prices at the fuel pump, everybody is paying attention. This, in turn, drives the development of alternative fuels and the supporting, innovative businesses that supply those alternative fuels.
Worldwide, energy production from renewable resources is growing rapidly. As concern about climate change and energy security grows, the market for renewable energy is booming. Government-mandated contributions from green power are giving the sector a big boost and the confidence that the drive for green power will last. In California, utilities are required to supply 20 percent of electrical generation from renewable energy by 2010 and 33 percent by 2020. The U.S. Department of Energy has targeted 30 percent of our transportation fuel to come from biofuels by 2030. Achieving these aggressive goals for renewable energy production is not easy. It is a huge change, creating equally huge opportunities for entrepreneurs.
Venture capitalists know an opportunity when they see one and are pouring money into green energy, investing more than $900 million in cleantech in 2005, according to the Clean Edge report “Clean-Energy Trends 2006.” This investment is primarily in solar, wind, and biofuels. While such actions may be motivated in part by the desire to do the right thing, these are not philanthropic donations. Rather experienced and tough-minded venture capitalists think renewable energy is a good investment. That is the bottom line.
Clean, quiet, and increasingly versatile, solar power is growing 40 percent a year (The Economist, March 10, 2007). The growth in solar power and continued technology innovation will drive down prices, further expanding the market and making rooftop solar panels increasingly competitive. In fact, the growth in solar-panel installation is so rapid, it can be difficult to train workers fast enough. This creates an opportunity for “green collar” workers in the energy sector and those who train them (Opportunity 1). Solar power also is increasingly diverse as it becomes integrated into purses and camping gear to power our plugged-in way of living (Opportunity 10). Solar ovens help people in the developing world reduce dependence on dangerous, polluting cooking stoves that burn charcoal, wood, and dung, and solar barbeques may remove pollutants from U.S. backyards (Opportunity 6). All of these are signs of the brighter solar future that eco-entrepreneurs are creating.
Other forms of green energy also are growing rapidly, particularly wind. Utilities are installing large wind turbines at a breakneck pace, but smaller wind turbines are bringing power to homes and businesses, and architectural turbines on buildings may bring wind power downtown (Opportunity 2). Fuel cells remain costly for applications such as the long-awaited fuel-cell car, but eco-entrepreneurs are making rapid inroads in markets for clean, emergency-backup power (Opportunity 8). Like modern alchemists, researchers are even finding ways to use microbes to turn wastewater into electricity (Opportunity 7)—killing two birds with one stone.
Our cars still rely almost entirely on oil, putting our economy in an increasingly precarious position. Since the oil shocks of the 1970s, our dependence on imported oil has only grown and the remaining oil reserves increasingly are concentrated in the hands of the Organization of Petroleum Exporting Countries (OPEC). Biofuels are being aggressively developed worldwide to provide alternatives, such as ethanol (Opportunities 4 and 5) and biodiesel (Opportunity 3). Biofuel production has increased dramatically but still accounts for only a small percentage of what we consume, ensuring a strong opportunity for many years to come.
One energy resource that is often overlooked is simply using less energy. By living more efficiently, we get more out of the energy we already have. This is not only a good solution, hands down it’s the best solution. Power plants are a lot more expensive than compact fluorescent bulbs, insulation, and weather stripping. Conserving a megawatt by using it more efficiently is a better use of capital and natural resources than sinking money into new power plants. Energy saved from efficiency is sometimes measured in units called “negawatts,” and generating energy in this way is another opportunity to divert waste into profit (Opportunity 9).
The opportunities could not be bigger for innovative businesses bringing greener energy to consumers. If you are an entrepreneur looking for the next big thing, this could be the field for you; the future is always open for innovators with visions of a bright future and the drive to make it happen.
OPPORTUNITY 1 Training for Solar Workers
| The Market Need | Installation of solar systems is growing rapidly, but training of workers is not keeping pace. |
| The Mission | Create schools and programs for training of solar workers. |
| Knowledge to Start | Education, renewable energy, electrical |
| Capital Required | $$ |
| Timing to Start | Months |
| Special Challenges | Gaining certification |
Solar power is booming, with production of solar photovoltaic panels increasing a whopping 40 percent a year from 2000 to 2005 (The Economist, March 10, 2007), and reaching $15 billion globally in 2006 (The Clean Tech Revolution, Pernick and Wilder, 2007). This growth is stimulated by rebates, tax incentives, and consumers’ desire to do what is right. Germany and Japan are leading the way in solar-panel installation, and California has pledged to install solar panels on 1 million roofs in the next ten years. Although solar power produced only 0.04 percent of the world’s electricity in 2004 (International Energy Agency), this percentage is growing rapidly.
RELATED TREND
Photovoltaics (PVs) are not the only form of solar power. Other solar panel systems that heat oil or generate steam to produce power are resulting in large-scale production of power by utilities, but for the residential market or commercial rooftops, PVs are still the only way to go.
Solar power has a lot going for it. Once installed, photovoltaic panels sit silently on the roof generating electricity for up to 30 years without any moving parts and with little maintenance. Panels can be installed almost anywhere, and new materials, such as solar roofing tiles are less conspicuous in building designs. Producing solar electricity doesn’t have a fuel cost, as sunlight is still pretty much free and doesn’t produce carbon dioxide, noise, or pollution. With power like that, what’s not to love?
IN THE LONG RUN
As new solar-power technologies get better and cheaper, solar panels increasingly will be integrated on building surfaces. As this happens, builders will incorporate renewable-energy production in home design.
Things are looking sunny for solar power, but it’s not out of the woods yet. Even with incentives and rebates, its cost is still a major factor for many. The $25,000 or $30,000 price tag for the average photovoltaic system remains a fair chunk of change for most, and a shortage of silicon held back production and increased prices of panels in 2006. But these limitations are passing. Panel producers are ramping up production, financing is improving, and costs will fall as production continues to increase. According to the Solar Energy Industries Association, the cost of electricity produced by solar panels is expected to drop to about $.08 to $.09 per kilowatt-hour in the next ten years, low enough to compete with natural gas or coal.
RELATED TREND
Many eco-entrepreneurs are working on new thin-film technology and solar concentrators to drive down the cost of solar power and increase efficiency. Novel financing models to reduce the cost barrier are another area of innovation.
As production of solar power continues to grow rapidly and becomes increasingly competitive with electricity from other sources, who is going to install all of these systems? Today, most photovoltaic systems in the United States are installed in those states that boast the biggest rebates and tax incentives to consumers. If more states join those programs, or nationwide incentives become more attractive, expect the solar wave to spread, creating opportunities for eco-entrepreneurs to install the panels as fast as the industry can produce them.
OPPORTUNITY TO IMPROVE
It’s a fact: Photovoltaic panels work best when they are cool. Unfortunately, some of the places with the best sun for solar—like the Southwest—are hot, thereby decreasing the efficiency of solar panels. Improving the efficiency of panels by cooling them might be a simple way to increase their power output. For example, one hot day, I sprayed the panels on my home with water and power generation went up 36 percent, if only for half an hour until the panels heated up again. ❦
INDUSTRY INFO
See the Solar Energy Industries Association (SEIA) for the solar industry’s perspective and support for solar companies. Check their website at seia.org. The American Solar Energy Society is another resource (ASES.org).
To install solar panels, the ideal worker needs a strong background in construction and electrical skills, with certified training specific to solar panels. The solar industry is growing so quickly, though, that businesses are having difficulty finding trained installers. Gerald Zepeda at Sun Light and Power of Berkeley, California, says, “We often hire people with construction, plumbing, electrical, or similar experience and train them ourselves,” helping employees achieve certification by the North American Board of Certified Energy Practitioners (NABCEP). Zepeda also says he looks for individuals who are committed to a green lifestyle, walking the walk that matches what they do for a living. Once workers get started, the company is motivated to keep them trained to stay abreast of this rapidly evolving field.
Van Jones, founder of Green For All, may have one answer for deploying renewable energy in America’s cities and keeping the green wave growing. Millions of people in cities continue to be left behind by economic and environmental progress while manufacturing jobs move overseas. Training these people for new “green collar jobs”—installing solar power and other forms of renewable energy—can help the renewable energy industry keep up its rapid growth, get these people on track to rewarding careers and lives, and help the country and planet in the process. Too often, job training provided by schools and the government has been focused on old industries that are shrinking rather than growing. Green collar jobs, on the other hand, cannot be outsourced, provide viable skills, and craft a career path for the future. As Jones says, this situation is not just creating jobs, but building “green paths out of poverty.”
GREEN LEADER
Lyndon Rive, CEO of SolarCity in Foster City, California, told The New
York Times, “It is hard to find installers. We’re at the stage where if we continue to grow at this pace, we won’t be able to sustain the growth” (February 1, 2008).
INFORMATION RESOURCE
The U.S. Department of Energy lists training programs on its Solar Energy Technologies Program website at www1.eere.energy.gov/solar.
Although solar installers are doing their best to train the workers they need, in-house programs cannot keep pace with the continuing growth of the industry. Training programs are already springing up at universities, community colleges, and even high schools. Vocational schools and programs like the one incorporated in electrical training at the Electrical Training Institute of Southern California also provide models for training.
INFORMATION RESOURCE
The U.S. Department of Energy lists training programs on its Solar Energy Technologies Program website at www.eere.energy.gov/solar.
One accessible opportunity for eco-entrepreneurs is to establish new training programs for renewable energy workers. Starting a new school for this is not a one-person operation and requires people from a variety of backgrounds. Those with experience in renewable energy would do best collaborating with others who have experience in education and business, making the most of everyone’s skills. New schools can specialize in renewable-energy training by partnering with solar companies; taking over existing in-house training; and ensuring a continued stream of workers. To attract students and gain an edge, schools should emphasize practical training with the latest technology and offer job placement.
To get started creating a solar training program, you need to have a strong grasp of the technical and business aspects of the industry. Becoming certified by a group such as the NABCEP is one way to accomplish this, and getting the necessary background by working in the industry, taking courses, talking to industry veterans, going to conferences, and even taking someone else’s training program to see how it works. Online courses are offered by some programs, providing a convenient way to learn, and a possible opportunity to develop.
One source of funding for training programs is government grants. The 2007 energy bill provides up to $125 million per year for green-job training, and other government and private investments in training are expected to follow. This funding can provide training for tens of thousands of workers who can be part of the green wave and ride it to success. From the solar industry perspective, Zepeda says, “It’s a step in the right direction.”
Types of solar opportunities include:
• Building a solar worker-training program
• Developing new solar technologies
• Creating alternative funding for solar power
• Launching a job board for renewable-energy workers
• Creating online courses and programs for renewable training
Although solar power is growing rapidly, solar panels still are found on only a few scattered homes. Those who see the glass as half empty might be discouraged, but others see an opportunity waiting to be realized. Success is when every home generates its own electricity. In addition to solar, wind power and biofuels are growing rapidly, and trained workers are needed in these areas as well. By one estimate, renewable energy already employs 8.5 million people in the United States and might employ as many as 40 million people by 2030 (American Solar Energy Society, “Renewable Energy and Energy Efficiency: Economic Drivers for the 21st Century,” 2007). The green wave is growing rapidly, but continuing its growth will take far more trained workers. Now is the time to start training them.
OPPORTUNITY 2 Small Wind-Turbine Installer
| The Market Need | Renewable energy other than solar power in cities and suburbia |
| The Mission | Provide small wind turbines for customers to produce their own clean power |
| Knowledge to Start | Electrical, mechanical |
| Capital Required | $ |
| Timing to Start | Weeks to months |
| Special Challenges | Small market today, but has large potential |
When it comes to renewable energy, wind power is cheap, clean, and effective. With strong and steady wind, the cost of electricity from utility-scale wind power can be as low as $.03 or $.04 per kilowatt hour—competitive with natural gas and even coal. Factoring in the additional costs of burning coal—air pollution, destruction of land, and climate change—makes wind power look like a real bargain. This is helping to drive rapid installation of large wind turbines and an emerging market in installing small wind turbines at homes and businesses.
INDUSTRY INFO
The American Wind Energy Association provides support for wind entrepreneurs in many ways. For more info about the opportunities in small-wind-turbine installation see the association’s 2007 Small Wind Turbine Global Market Study (awea.org).
Globally, the wind business grew an incredible 50 percent in 2006 (The Clean Tech Revolution, 2007), and wind power will continue to benefit from commitments to increase the use of renewable energy. There are already many winners in wind power: Producers of large wind turbines are doing very well, with manufacturers of towers, blades, and turbines in Europe, Asia, and North America jockeying for a lead position. The turbines being installed increasingly are enormous towers for megawatt-scale wind farms run by utilities—larger towers can produce power more efficiently. Some utility-size wind towers have blades more than 100 meters across, a football field in size. Companies building improved turbines, blades, or other components are expected to continue to find opportunities to grow with utility-scale wind power.
RELATED TREND
The cost of importing wind turbines produced outside the United States increased somewhat in 2007, in part due to the declining dollar and increasing cost of imported components. This should increase the competitiveness of turbines and components produced inside the United States.
Large wind towers can produce a lot of energy, but they also can raise objections from the local community. To one person, a wind farm may be a thing of beauty, replacing coal with clean, renewable energy. Others feel towers mar the scenery, leading communities to block prominent wind projects in places like Cape Cod, Massachusetts. Some residents have objected to noise or potential harm to birds. Wind power developed in wind-rich rural areas like North Dakota also is a long way away from major urban centers where most of the power is used, leading to transmission difficulties. A way for wind to contribute to our power needs avoiding some of these problems is with small wind turbines located at homes and businesses, bringing wind power directly to the consumer.
RELATED TREND
One form of wind investment is community wind projects, described in Greg Pahl’s book The Citizen-Powered Energy Handbook. With technical, financing, and regulatory issues properly addressed, locally owned wind projects stimulate the local economy and could grow rapidly.
Large wind towers work best for utility-scale energy in open remote areas, and are not generally welcome in urban or suburban environments. Small wind turbines with blades that are, at most, a few meters across are starting to pop up in locations where large turbines would not work. Local regulations permitting, small turbines can generate enough power for the average home’s needs. There were about 6,800 small wind systems sold in the United States in 2006 (AWEA Small Wind Turbine Global Market Study, 2007), with U.S. companies dominating this part of the wind business. A variety of state or local tax credits or rebates may apply to wind systems, although there isn’t a federal tax credit for small wind systems at this time. The U.S. market for small wind systems in 2006 was $56 million, a figure that is small compared with large wind turbines but growing between 14 and 25 percent a year (AWEA Global Market Study, 2007). If given a federal tax credit similar to that given to solar, the market for small wind systems likely would see much faster growth.
Wind systems like the Turby or Skystream are installed on small towers in rural and suburban markets for homes and small businesses. The Skystream from Southwest Windpower costs between $12,000 and $15,000 installed, and a typical home with a properly sited wind generator and 12 mile-per-hour wind speeds can generate 400 kilowatt hours a month, a large proportion of what most homes use. This cost compares favorably with solar power.
GREEN MARKET
Small wind may really take off in cities such as San Francisco and Chicago that have wind to spare.
Wind power might be a harder sell in less windy locations.
According to Miriam Robbins at Southwest Wind-power, “Small wind systems, especially our new Skystream design, cost less to install than the same amount of PV.” It has been estimated that electricity produced from small wind comes to about $.11 per kilowatt hour, compared with about $.18 for solar power. While small wind has been more common in rural areas, installation in suburban regions is expected to increase as people get used to seeing turbines. “We anticipate that installs will get more and more residential as more and more are installed and accepted within communities,” Robbins says. As small wind grows, so do opportunities for small-wind-turbine installers and dealers.
To become a small-wind-turbine installer, turning to the experience of others is helpful. The paper “How to Build a Small Wind Energy Business: Lessons from California” presented at the ASES Solar 2007 Conference (available online at nrel.gov) describes the ins and outs of starting a wind business. The paper describes many factors that come together in a region to help wind entrepreneurs, including permitting requirements, state incentives, the cost of power, and wind in the region.
Another form of small wind power is being designed and installed in architecture on buildings in the suburban and urban landscape. Rather than towers, wind turbines can be fixtures on buildings, capturing the wind gusting through the urban landscape. Ongoing experimentation in this new side of wind is expected to continue to improve output and lower costs. Aerovironment in Monrovia, California, and Aerotecture in Chicago, Illinois, are developing turbines to be installed on commercial buildings and other urban structures.
Types of small-wind-power opportunities include:
Distributing small wind towers
Installing small wind towers
Designing small wind systems
Developing community wind
Incorporating architectural wind turbines in urban and suburban building design
Given the early stage of the small wind sector and the small scale of the systems involved, this field is suited to smaller entrepreneurs looking for a way into wind power. Becoming a small-wind distributor or installer is an accessible option, especially for individuals experienced in working with mechanical or electrical systems. As more wind installations start popping up, people’s reluctance likely will diminish and the market should grow, similar to photovoltaics. There is plenty of room to grow and plenty of wind to go around.
OPPORTUNITY 3 Biodiesel Production
| The Market Need | Renewable fuels |
| The Mission | Join in the biofuel revolution with small-scale biodiesel pro duction |
| Knowledge to Start | Autos, fuels |
| Capital Required | $$ |
| Timing to Start | Months (for small-scale production) |
| Special Challenges | Source and cost of feedstocks as well as regulations for sales |
When it comes to transportation fuels, oil is king. In 2005, the world consumed about 30 billion barrels of oil (Energy Information Administration, eia.doe.gov), most of it for transportation, with millions of new cars coming on the road in the developing world. The consumption of oil accelerates climate change, pollutes the air, and generates geopolitical headaches spanning the globe, creating a massive opportunity for entrepreneurs working to change this with the production of biofuels such as biodiesel derived from plant or animal products.
INDUSTRY INFO
For more biodiesel industry information and statistics, see the National Biodiesel Board’s website at www.biodiesel.org.
The number of diesel cars introduced in the United States is increasing as awareness grows of the advantages of diesel. Petroleum diesel produces more power per gallon than gasoline, is more energy efficient, and uses simpler engines (without spark plugs or a distributor) that require less maintenance. However, petroleum diesel produces significant pollution and is nonrenewable. Biodiesel is superior to petroleum diesel in many ways. Produced from vegetable oils or animal fats, biodiesel burns more cleanly and is a renewable fuel that can fight climate change. Biodiesel can be produced from used cooking oils; grease; palm, canola (called rapeseed in many countries), soybean oil; or just about any other plant that makes oil. Unlike straight vegetable oil, biodiesel is chemically modified to suit engines right out of the factory, and diesel engines have run for hundreds of thousands of miles on the fuel. It is also nontoxic (unlike petroleum diesel or gasoline), and can be blended with petroleum diesel to increase engine lubrication. By improving engine lubrication, biodiesel fuel reduces engine wear and keeps them cleaner, reducing maintenance costs and breakdowns.
ECO-TIP
Straight vegetable oil can fuel a car for a short time, and it looks neat to pour vegetable oil in your car and drive around, but this nonstandard fuel quickly burns out engines that are not specifically modified to handle it.
The United States consumes about 58 billion gallons of diesel fuel and related petroleum products each year, and the National Biodiesel Board estimates that U.S. demand for biodiesel was about 225 million gallons in 2006. Production of biodiesel is increasing rapidly but remains only 0.4 percent of overall consumption. It has been estimated that even if the United States converted all its cooking oil and animal grease to biodiesel, this would cover only a small fraction of our needs. Planting all spare farmland with biodiesel crops such as canola or rapeseed could increase biodiesel’s share of our total diesel use to only between 10 and 20 percent. Entrepreneurs do not need to provide our entire diesel supply from biodiesel to build a business, however. Displacing even a small part of the oil we use can still be a successful business.
ECO-ISSUE
Although biodiesel has a lot of advantages, it does have a down side or two. Compared to petroleum diesel, biodiesel becomes a gel more easily at low temperatures, requiring specialized engine modification in colder areas.
IN THE LONG RUN
Competition for soy between biodiesel, food, and other uses is driving up its price, causing inflation and controversy about the cost of food. If the rising cost of soy keeps the price of biodiesel high, it will limit the market in the long run, driving production toward alternatives (see Opportunity 74).
Large biodiesel producers include agribusiness giants like Archer Daniels Midland (ADM), which is positioning itself as a potent global force in biodiesel and ethanol production. Regional production also is beginning to produce biodiesel locally using the feedstocks available where the fuel will be used. To address this market, regional producers—such as Pacific Biodiesel in Hawaii and Imperium Renewables in the Northwest—are developing production capacity around the country.
BEYOND SOY
Soy beans are the mainstay of U.S. biodiesel production, but the soy plant is neither the only oil-producing plant nor the best one. In Europe, canola is the main source of biodiesel, and a variety of other crops produce oil. There are ongoing opportunities in each region to grow a variety of crops for fuel. Having fuel-specific crops can help avoid the food-fuel controversy. ❦
GREEN MARKETS
Companies trying to improve their environmental impact are fueling their fleets with biofuels. This creates a great market for biodiesel fleet sales, guaranteeing a steady income with a good relationship.
Big players like ADM are hard to beat on price alone, with market power and economies of scale on their side, but innovative small businesses can compete by identifying local or regional niches. Establishing a unique brand is one way to carve out a market niche, as is the case with BioWillie biodiesel, endorsed and promoted by country music legend Willie Nelson. Biodiesel enthusiasts may prove loyal to a local brand with which they identify. Another way to differentiate your company is to use sustainable methods, such as avoiding pesticide use, competition with food, or clearing new land for fuel crops.
A growing cadre of dedicated enthusiasts is so committed to biodiesel that they are producing their own. One of the attractive aspects of biodiesel is that it can be done on a small scale, even in your backyard (check your local regulations). On their own and in co-ops, more and more people are using the resources they have available locally—including restaurant grease, used vegetable oil, and virgin vegetable oil—to make themselves self-sufficient for fuel. The higher the price of gas goes, the more the wave of home-brewed biodiesel will grow. Greg Pahl (author of Biodiesel: Growing a New Energy Economy) confirms that, although statistics are hard to come by, a growing number of local producers and cooperatives—such as Piedmont Biofuels in North Carolina (biofuels.coop)—are springing up to provide energy security, stimulate economic growth, and fight climate change.
GREEN LEADER
Author Greg Pahl’s website is gregpahl.com.
Small producers can find the biodiesel business rewarding but also frustrating due to challenging regulations. Selling fuel to the public requires ASTM compliance, which can be expensive (ASTM International develops technical standards for a wide variety of products and materials). Small producers, such as co-ops, can fly under the radar and deal with minimal regulation as long as they only use the fuel themselves. Experienced veterans, such as Piedmont, provide an invaluable resource for education, consultation, and finding supplies. Piedmont also provides classes and information on their website about ASTM testing of biodiesel.
RELATED TREND
One business idea is selling materials to enthusiasts, helping them to get started with biodiesel production. For more information, visit homebiodieselkits.com. Piedmont Biofuels also sells systems for production.
The growth of biodiesel presents opportunities for distribution and installation of alternative-fueling stations (Opportunity 67). The special properties of biodiesel mean it cannot be handled in the same way as petroleum diesel, creating opportunities for those who specialize in ensuring the delivery of the highest quality biodiesel from production to pump.
ECO-ISSUE
The chemical process that makes biodiesel is also producing tons of glycerol, flooding the market and driving down its price. The oversupply of glycerol is an opportunity to find new ways to use this biodiesel byproduct.
Entrepreneurs getting into the fuel market need to find a niche where biodiesel can compete with petroleum products. The more expensive oil becomes, the easier it will be for biodiesel to compete if the cost of feedstocks does not increase to the same extent. As a good lubricant, biodiesel can be blended with petroleum diesel to reduce engine wear and increase performance. The market for an additive for petroleum diesel would create a demand for hundreds of millions of gallons of biodiesel.
IN THE LONG RUN
Algae can produce high levels of oil that can be converted into biodiesel. From 1978 to 1996, the U.S. Department of Energy spent millions of dollars testing algae oil production in large, outdoor ponds. In the current biofuels boom, several companies—such as Greenfuels and Aurora Biofuels—have created new strategies to use algae as a source of climate-friendly fuel. ❦
The clean-burning nature of biodiesel should help it to compete in urban markets. For example, hospitals need a backup power system, but having a big, polluting diesel generator running next to the building may not be the best option. Clean-burning biodiesel for electrical generators produces far fewer pollutants and health problems. Plus, in parts of the world where power is unreliable, diesel generators are common, and biodiesel from used cooking oil could provide a clean alternative.
Types of biodiesel opportunities include:
Creating biodiesel cooperatives
Supplying parts and materials for biodiesel enthusiasts
Developing plant oil-based lubricants and solvents
Establishing branded biodiesel sales
Working in biodiesel distribution and quality control
It’s not likely that biodiesel will replace petroleum diesel completely, but entrepreneurs still can build a business. There are many biodiesel niches from which entrepreneurs can profit while reducing reliance on petroleum diesel, at least in small part. Every step forward is a step in the right direction.
OPPORTUNITY 4 Sugarcane Ethanol Production
| The Market Need | Clean, green biofuels in addition to corn ethanol |
| The Mission | Sustainably and cleanly grown sugarcane for ethanol production |
| Knowledge to Start | Fermentation, sugar market |
| Capital Required | $$$ to $$$$ |
| Timing to Start | Months (for small-scale production) |
| Special Challenges | Government policy in sugar program and biofuel incentives |
Ethanol production in the United States today comes almost exclusively from the fermentation of corn. Why corn? The United States grows a lot of corn and knows how to make it into ethanol. However, we only have so much corn, which is why billions of dollars are being spent to figure out how to produce cheap cellulosic ethanol from agricultural waste and plants such as switchgrass. Meanwhile, entrepreneurs worldwide are already producing billions of gallons of ethanol from another resource: sugarcane.
Sugarcane has many advantages over corn for ethanol production. In the right climate, sugarcane grows quickly and converts a large percentage of its energy into making sugar. Sugar is the key ingredient needed to make ethanol, as with the yeasts that produce wine from grapes. While the sugar in corn is locked in starch that must be broken down before it can be fermented by microbes into ethanol, the sugar in cane forms a large part of the liquid content of the plant; fermentation starts almost as soon as the plant is cut. Ethanol from sugarcane yields eight times more energy than is used to produce it—a ratio that is five or six times better than corn—and sugarcane ethanol reduces greenhouse gas emission by between 80 and 90 percent when compared with gasoline—much better than the 10 to 20 percent reduction estimated with corn ethanol (David Tilman and Jason Hill, Washington Post, March 25, 2007). Per acre, sugarcane produces about twice as much ethanol as corn. Increasing the production of ethanol from sugarcane may provide a viable route for biofuel businesses.
BALANCING ACT
If increased production of Brazilian ethanol destroys the Amazonian forest, the cost may be too high to overlook. However, Brazilian officials have stated that sugarcane production requires only 6 million hectares, with more than 100 million hectares of land available for expansion without intrusion into the rain forest. Raising cattle is probably a greater threat to Amazonia, using land to provide feed and grazing. Going vegetarian is a more effective way to fight deforestation than fighting cane ethanol. ❦
Sugarcane-ethanol production in Brazil has set the standard, producing the cheapest ethanol in the world. Brazilian ethanol costs about $0.81 per gallon (Science, March 16, 2007), compared with a cost of $1 to $1.06 for a gallon of American corn ethanol with subsidies (Energy Information Administration, 2005). Brazil gets about 40 percent of its auto fuel (not including diesel cars) from sugarcane ethanol, producing 282,000 barrels of ethanol a day in 2005 (Nature, December 7, 2006). Although the United States currently imposes a $0.54-per-gallon import duty on Brazilian ethanol, it is attracting worldwide attention and money from investors such as George Soros, who is investing $900 million.
Objections often have been raised to the environmental impact of growing sugarcane and producing ethanol from it. The ideal biofuel does not just displace petroleum but can be produced without damaging the environment, providing a sustainable-fuel alternative. The 2006 report “Sustainability of Brazilian Bioethanol” from Utrecht University in the Netherlands, gave it a score of “average” to “very positive,” confirming its overall climate benefit. While cane fields in the past were burned, new practices encourage cane to be farmed more sustainably, leaving residue in fields to compost rather than burning it. Many new distilleries in Brazil burn cane waste as fuel instead of burning fossil fuels, and many of Brazil’s sugarcane growers are signing agreements to use sustainable production methods. Increasing awareness of the need for sustainably produced fuel will drive some buyers on the international ethanol market toward fuel that is certified as being produced in an environmentally sustainable manner.
The sugarcane approach is being developed in other regions with tropical and subtropical climates, trying to replicate Brazil’s success. The Brazilian story took decades of work farming, harvesting, distilling, distributing, designing fueling stations, and developing cars that could handle the fuel. This process takes time and effort, but if Brazil has done it, others can too, particularly if the price of oil continues its upward climb. Barring policy changes in the United States, it may be more productive to invest in sugarcane production elsewhere. The U.S. market is big for biofuels but it is not the only one. There is room around the world for greater cane production without cutting into food production, and if the cane is grown responsibly and sustainably, it will have the same impact on climate and oil use whether the crop is grown in India or in Florida.
What about importing Brazilian ethanol to the United States? The current tariff makes this expensive, pricing Brazilian ethanol above U.S. corn ethanol. The US corn lobby will put up a stiff fight before the ethanol tariff changes, and it would take a brave politician to support this move. It may not be likely, but if the tariff is lifted, it would create an instant opportunity for importing, distributing, and supplying ethanol from Brazil.
What about U.S. production of ethanol from sugarcane? Sugarcane in the United States is produced mainly in parts of Florida, Louisiana, and Texas along the Gulf Coast. Climate is one factor restricting sugarcane production and use for ethanol, but it’s not the only factor. The US Department of Agriculture published a report in 2006 on “The Economic Feasibility of Ethanol Production from Sugar in the United States,” finding that production of ethanol from molasses was cost-effective in the United States but production from cane sugar was less so.
INFORMATION RESOURCE
You can find the 2006 report at the USDA website, usda.gov, by searching for “sugarcane ethanol.”
Why does ethanol production from cane work so much better in Brazil? One important reason is government policy. The U.S. sugar program keeps the price of sugar about twice as high in the United States when compared to the rest of the world, making the cane sugar too expensive to use for ethanol production. With increased support for sugar-to-ethanol production, the process can be more competitive. Hawaii already is moving to increase ethanol production from cane by requiring that gasoline there include 10 percent ethanol. Sugarcane ethanol probably is never going to be as big in the US as Brazil, but with lower sugar prices and greater incentives, more cane sugar would be used for ethanol production.
One opportunity to move sugar-to-ethanol production in the United States forward is to use sugar mixed with starch from corn during fermentation, thereby increasing the overall yield of ethanol production. This strategy has been proven to work in the past when the price of sugar was low. Another path forward is by combining fermentation of sugar with the cellulose of the rest of the sugarcane plant. Today, this material often is considered waste but improved cellulosic ethanol production would increase sugarcane ethanol productivity and lower its cost. Locating ethanol production close to where cane is grown and creating ethanol production co-ops in these areas also keeps costs low and helps build viable businesses.
RELATED TREND
Finding coproducts from sugarcane plants in addition to ethanol can allow more money to be made from the same amount of crops, potentially reducing the number of plants needed to get started. Academic, government, and industry researchers around the world are finding creative ways to use parts of the sugarcane plants to make other products.
The barriers to making ethanol from cane sugar in the United States may seem daunting, but they are no more daunting than the obstacles standing in the way of other transportation solutions. Sugarcane ethanol can be produced economically, as Brazil has demonstrated. What is blocking the U.S. market is government policy, not science or technology. The same cannot be said of cellulosic ethanol (See Opportunity 5) or hydrogen fuel-cell cars. Policy may seem immovable, but it’s not written in stone; it can change, and a chink in the armor already may be developing. One provision of the North America Free Trade Agreement (NAFTA) of 1994 stipulates that Mexico can export unlimited sugar to the United States starting in 2008. Under current sugar policy, the U.S. government may be obligated to buy hundreds of millions or even billions of dollars worth of sugar to maintain current price supports and then sell it at a steep loss to ethanol producers.
INDUSTRY INFO
For the sugarcane industry’s perspective, see the American Sugar Cane League (amscl.org).
Types of sugarcane-to-ethanol opportunities include:
Creating ethanol production co-ops
Mixing sugar with other ethanol fermentation
Selling sugar coproducts
Investing globally in sustainably produced sugarcane ethanol
Combining cellulosic and sugar ethanol production
We often are looking for “the solution” to our energy needs, the one answer that provides low-cost energy without polluting, degrading cropland, raising food prices, destroying habitat, or contributing to climate change. Cane sugar might not ever supply all of our energy needs, or provide the solution for everything, but entrepreneurs supplying ethanol from sugar can build a good business with the right conditions in place. With the continued pressure to increase our energy security and fight climate change, a shift in U.S. policy to encourage the production of ethanol from sugarcane might be just around the corner.
OPPORTUNITY 5 Breaking the Cellulosic Ethanol Barrier
| The Market Need | Cellulosic ethanol still is not a cost-effective business |
| The Mission | Make cellulosic ethanol cost effective |
| Knowledge to Start | Farming, distribution, fermentation |
| Capital Required | $$$$ |
| Timing to Start | Years |
| Special Challenges | Research needed for commercial production |
In the race to produce biofuels, production of corn ethanol consumed about a third of the corn grown in the United States in 2007 and displaced about 5 percent of the gasoline used (The Economist, December 6, 2007, also, Energy Information Administration). The U.S. government has set a target of reducing anticipated gasoline use by 20 percent by the year 2017 and 30 percent by 2030, an aggressive goal that creates a huge opportunity, but corn ethanol alone is not going to get us there. The price of corn already has doubled as a result of competition between fuel and food, raising food prices and stirring global protests. Producing more biofuel requires other solutions, and the big money is betting on cellulosic ethanol, which is produced by converting the cellulose in plants into ethanol. Entrepreneurs who can make the cost of cellulosic ethanol production competitive with other fuels will realize an even larger opportunity than corn ethanol.
Fermenting corn for ethanol uses only the corn itself; microbes convert the starch in corn into ethanol, like wheat is fermented to make beer or grapes for wine. This leaves the stalks, stems, and cobs made of cellulose behind. Cellulose is the most abundant biomolecule on our planet, but although it’s made of sugar, most animals cannot digest it. Cellulose-eaters, such as cows and termites, rely on microbes to break down the cellulose into useable sugars. Whoever finds a clean and economical way to unlock the energy of cellulose will fuel the next biofuel revolution.
The Department of Energy, other parts of the U.S. government, and additional groups too numerous to list are funding cellulosic ethanol research. Researchers are looking at every step in the process: growing the plants, harvesting them, breaking up the plant material, breaking down the cellulose into sugar, and converting it into ethanol. All of this can already be done but needs to be done better to produce cellulosic ethanol cheaply enough to compete with gasoline. Companies like Novozyme of Denmark are making enzymes that can break down cellulose. Startups like Mascoma and Verenium, both in Massachusetts, are looking for new enzymes that release the sugar from cellulose. Pilot plants for industrial production of cellulosic ethanol already have been built by companies like Iogen of Ottawa, Canada, and more pilot plants are on the way. We know we can make ethanol and use it as fuel. The only question is whether we can do it cheaply enough to compete with other fuels and in a way that makes sense for the environment.
There is not one business opportunity in cellulosic ethanol but many. Corn-based ethanol is paving the way for cellulosic ethanol in many ways, but there isn’t a system yet for harvesting and collecting the material that would be used to make the new fuel. For example, if switchgrass, a perennial, is a solution, then farmers will need new ways of harvesting it, and businesses will need to collect the material and transport it. What other material can be used to produce cellulosic ethanol? Potentially, every different crop will require different processing and a variation on getting sugar and ethanol out of the plant material. Growing different crops for fuel creates unique opportunities wherever you live.
RELATED TREND
A related opportunity is for companies to find creative uses for coproducts. For example, if waste heat is produced, it should be captured. Compounds called lignins, which are released from cellulose, might have their own use. Companies such as Lignol Innovations in Canada already are starting to look at these opportunities.
Today, most ethanol is produced and sold in the Midwest and in states such as California that have mandated that ethanol be mixed with other fuels. To reach the U.S. government goals set for 2017 and beyond, production needs to increase from between 5 and 6 billion gallons to 20 and 30 billion gallons in less than a decade. Regional producers across the country are producing corn ethanol, and if cellulosic ethanol is perfected, there will be massive expansion of this market.
RELATED TREND
With so many small companies getting involved in ethanol production, and a lot of money being invested, consolidation is expected to occur along the road to commercialization. Driven by the pressure for more research and to produce a cheap commodity, opportunities for mergers, acquisitions, and partnerships will spring up.
Starting a business in ethanol production sees stiff competition, significant research investment, and no immediate payoff. However, the opportunities are not just for fuel production but exist at every step in the supply chain, including distribution and storage. Ethanol is corrosive and absorbs water from the air, making corrosion worse. The more ethanol takes off as a fuel, the more we need better ways of moving and storing it.
The glut in ethanol that depressed prices in 2007 was not because of excess ethanol production, but because production exceeded the distribution capacity to move the ethanol from the Midwest to other parts of the country (New York Times, September 24, 2007). With billions of gallons of ethanol being produced and far more planned, eco-entrepreneurs developing innovative ways of handling and distributing ethanol will find ready opportunities. Today, ethanol is distributed by rail and truck, although it would be more efficient to transport via pipelines. Finding a way to build pipelines that can handle ethanol is one option. Another is distributing the biomass to regional fermentation facilities where ethanol can be produced.
IN THE LONG RUN
While ethanol has several important factors in its favor—such as all the experience people have producing it, and it is known to work in many cars—it’s not perfect. That’s why bio-butanol is another fuel being developed as an alternative. Produced by engineered microbes, bio-butanol has a longer carbon chain than ethanol, helping bio-butanol absorb less water and giving it higher energy content. But bio-butanol still can work in our existing infrastructure. ❦
Types of cellulosic-ethanol opportunities include:
Finding technologies and strategies to reduce the cost of cellulosic-ethanol production
Distributing ethanol
Finding improved ethanol-storage solutions
Growing, harvesting, and processing new crops for ethanol
Developing sustainably farmed and produced ethanol
Finding uses for ethanol coproducts
The investments in cellulosic ethanol are large, but the potential payoffs are huge. Producing cellulosic ethanol on a large enough scale to make a significant contribution to our fuel needs is a big challenge, but we will never know if we can reach the scale unless we try. No matter what happens, at least we will be further down the road to a cleaner and more secure future.
OPPORTUNITY 6 Solar Cookers and Barbeques
| The Market Need | Traditional cookstoves are too polluting |
| The Mission | Provide nonpolluting solar cooking in the developed and developing worlds |
| Knowledge to Start | Design, business |
| Capital Required | $ to sell; $$ to develop new products |
| Timing to Start | Weeks to months (to sell models produced by others) |
| Special Challenges | Need marketing and education in the United States |
Cooking is universal. People everywhere cook, even if the foods they cook are vastly different. Every day in hundreds of millions of homes, food is prepared on stoves burning wood, dung, charcoal, coal, and other biomass. Burning wood for cooking in regions where wood is not abundant leads to further deforestation, long walks, and great expense for those without money to spare. Eco-entrepreneurs who encourage better ways of cooking are solving multiple problems at once.
Cooking with wood or other biomass is bad for the environment and for the health of millions. The smoke from indoor traditional cookstoves leads to respiratory diseases killing 1.6 million worldwide (WHO World Health Report, 2002). There is also a significant risk of fire in cramped living areas. In urban areas, cookstoves contribute to pollution and perhaps even climate change. Each cookstove is small, but with billions of them the smoke becomes a significant problem.
A variety of organizations have worked to bring cooking alternatives to the developing world, including Africa, India, Central and South America, as well as China. More efficient cookstoves have achieved some success, with hundreds of thousands of new stoves in Africa and millions of stoves deployed in China. These stoves still require biomass for cooking, but direct more of the produced heat to the food, and burn the fuel more efficiently with less carbon monoxide and smoke in the home.
That said, solar cookers are a cleaner way to go. Reflecting sunlight onto a small surface, they focus enough heat to cook food or heat up water. By avoiding the need for fuel, solar cookstoves save money that can be spent on education or other fundamentals. The designs and materials used in solar cookers seem almost limitless, ranging from simple homemade designs (such as a cardboard box covered with aluminum foil) to sophisticated parabolic mirrors. The expense of solar ovens reflects the materials and design. Parabolic cookers are efficient and able to heat food to temperatures as high as 400 degrees F. Box cookers, such as the Sport Solar Oven, can heat food up to 300 degrees F, plenty for most cooking needs.
RELATED TREND
Solar cookers also help purify water by heating and distilling it, another important need in many parts of the world.
With a broad range of possibilities, there is still room for innovative new designs that can attract the attention of consumers in different parts of the world.
Social entrepreneurs such as Solar Household Energy, Inc. (Chevy Chase, Maryland), Solar Cookers International (Sacramento, California), and the Solar Oven Society (Minneapolis, Minnesota) are working to bring solar cookers to the developing world. Acceptance of the ovens varies, and introducing solar cookers across the globe requires an understanding of the local culture and economy. Many early efforts to bring solar cookers or efficient cookstoves to the developing world resulted in sticker shock as people were unaccustomed to costs higher than a few dollars. The needs for lower costs and an understanding of local markets are good reasons for local eco-entrepreneurs to be involved in the production and selling of these ovens. For example, if buying an oven is not cost effective, eco-entrepreneurs help locals by selling materials and providing instructions to their fellow citizens; setup local co-ops to produce the solar ovens and sell the needed materials they will need; and work with microfinance organizations to support this eco-friendly micro-entrepreneurial drive (see Opportunity 26).
INFORMATION RESOURCE
To learn more about efforts to increase the use of solar cookers in the developing world, visit solarcookers.org.
In the developed world, consumers are starting to take a fresh look at backyard barbeques. A backyard barbeque produces smog, particularly from the lighter fluid and charcoal used; solar cookers are a clean, green alternative for summer barbeques. Solar cookers can cook burgers as well as any grill, without all the flames, smoke, and carbon dioxide, not to mention the flamebroiled carcinogens. A variety of models are on the market, like the Sun Cook from Sun Baked of Toronto, Canada. Founded by Stephen Kerr, Sun Baked sells solar ovens and other solar products. Mirrors on the Sun Cook focus heat on to a black surface, where insulation and a glass-covered chamber hold it in so that cooking food takes only one or two hours. Solar cookers have not made propane or charcoal obsolete yet, but as growing environmental concerns cause some to reevaluate their backyard barbeque, eco-entrepreneurs may be able to market solar BBQs at local home-products stores.
The opportunities in solar cooking include:
Increasing use in the developing world
Selling kits and materials to build solar cookers
Designing new models of solar cookers
Marketing solar cookers to increase knowledge and drive sales
Selling solar grills as alternatives to backyard barbeques
The main problem with solar ovens isn’t whether they work. It is relatively straightforward to design, build, and sell solar cookers online, at fairs, or wholesale to green retailers. The problem is acceptance. The prevalence of solar cookers in the developed world has been low so far, but with increasing numbers of green consumers such as LOHAS (lifestyles of health and sustainability) and so many others diving into green gadgetry, the market finally may be ripe for solar ovens. They are not just for greenies eating tofu burgers and veggies, but are also great for manly green carnivores grilling meat. Entrepreneurs of solar ovens need creative marketing to help change preconceptions and show customers that solar cookers work well, making great food. Customers need to see a solar cooker not as a curiosity but a product they want at home. Perhaps a Rachael Ray solargrill revolution is needed. If you can get Rachael or Oprah cooking with your solar grill on TV, you’ve got it made. The greener things get, the cooler the solar barbeque will be. Hip and trendy solar grills may be coming soon to a backyard near you.
ECO-TIP
Home-built solar cookers are fun, but the cardboard and aluminum foil models won’t get hot enough to cook meat, and an undercooked meal is no fun at all.
OPPORTUNITY 7 Microbe Electricity
| The Market Need | New sources of energy and ways to treat wastewater |
| The Mission | Generate electricity from wastewater |
| Knowledge to Start | Microbiology, engineering |
| Capital Required | $$$ to $$$$ |
| Timing to Start | Years |
| Special Challenges | Research to optimize design and find applications |
Here’s a little secret about the energy shortage—there isn’t one. Energy is everywhere, but most of it is in forms we cannot readily use. The trick is figuring out practical ways to convert the energy that already exists all around us into forms we can use. In our cars, we burn gas molecules to convert chemical energy into heat, and the engine converts the heat again to move the car forward. Microscopic organisims like bacteria harness energy that we currently throw away in energy-rich sewage, garbage, or other biomass and convert it into electricity and other forms of energy, unlocking new possibilities in power production.
Life itself depends on capturing energy and converting it to other forms. Plants take energy from the sun and convert it to chemical energy found in sugars, lipids, and proteins. Animals take the chemical energy of plants and convert it again to other forms like heat, sugars, and movement to survive. Microbes are exceedingly skilled at the energy game. These powerful microscopic critters do a variety of tricks with energy that “more evolved” organisms, such as humans, can’t. This allows microbes to live in just about every corner of the earth, and to produce energy from the tons of organic material we throw in dumps, burn in agricultural fields, wash into rivers, and flush down toilets. Instead of leading to poisoned rivers, overflowing landfills, and expensive waste-water treatment plants, this wasted chemical energy can be converted into useful energy.
Some of the energy in waste is captured by burning it and generating electricity using turbines. Another way to capture the wasted energy is to convert it to some other form that can be burned, just as microbes digest cow manure to produce methane and generate electricity (see Opportunity 72). Incineration is not always the answer though; in the case of solid waste from sewage, burning in incinerators is often out of the question. While a fire releases energy explosively and loses a lot of energy as heat into the surroundings, microbial fuel cells provide clean and efficient power generation without the pollution produced by incinerating waste. Microbial fuel cells produce energy directly by pushing electrons through a wire while eating waste.
Bacteria called “iron-eaters” eat organic compounds like acetic acid, pushing electrons to create an electrical current, generating power. Derek Lovley at the University of Massachusetts at Amherst has produced microbial fuel cells using iron-eating bacteria that are almost 80 percent efficient in capturing electrons to produce power, far more efficient than previous efforts to build microbial fuel cells or burning waste. Dr. Bruce Logan at Penn State has coaxed more garden-variety microbes into producing energy from wastewater and is working to demonstrate the process at larger scales. These academic breakthroughs may pave the way for businesses developing microbial fuel cells and applying them as a new form of renewable energy.
INFORMATION RESOURCE
For more about how microbial fuel cells work, see the websites of Dr. Bruce Logan (engr.psu.edu/ce/enve/logan.htm) and Dr. Derek Lovley (bio.umass.edu/micro/faculty/lovley.html).
One way to use microbial fuel cells is to generate electricity at wastewater treatment plants. We produce a lot of wastewater, and in the United States, getting rid of it consumes about $25 billion per year and 1.5 percent of our electricity (Mechanical Engineering magazine, 2004). The material contained in wastewater holds a lot of energy; it just needs to be unlocked and harvested safely. Waste treatment takes the organic matter in sewage and aerates, filters, and settles it to degrade organic material and remove dangerous microbes. Nothing useful is done with the energy in the waste. The process leaves behind a solid material called sludge that contains a lot of chemical energy but can be difficult to dispose of. One solution for sludge is to incinerate it, but sludge often contains pollutants such as heavy metals that can be released by burning. Microbial fuel cells could greatly improve the efficiency of water treatment, particularly where it is already costly.
RELATED TREND
What other devices are there where users would not want to change batteries ? These are candidates to use fuel cells instead of batteries for power. They will still need some type of food for the microbes, but otherwise microbial fuel cells could have a wide range of applications.
The challenge of harnessing microbes to produce power for humans is often getting the microbes to convert energy into a form we can use, such as electricity. The next trick is making this process commercially viable. To build a microbe-power business, start by understanding the current state of research. Ask academic experts and their tech transfer offices at universities if intellectual property is available to license. Building electrodes with greater surface area is one field of practical research. According to Dr. Logan, the key challenge for commercialization of microbial fuel cells is “making it economical in terms of cost of materials and scaling it up.”
One niche application is for the creation of environmental sensors. Sediments in oceans, rivers, and lakes contain organic material that can fuel a microbial fuel cell. Dr. Leonard Tender at the Naval Research Laboratory has developed a Benthic Unattended Generator (BUG) that gets its power from a microbial fuel cell to gather and report data on water and air conditions at sea. As the technology continues to develop, eco-entrepreneurs may use microbial fuel cells to build self-powered municipal water-treatment systems, home septic tanks, or even self-powered portable toilets.
RELATED TREND
Microbial fuel cells also can produce hydrogen from wastewater, helping to fuel the hydrogen economy from wastewater in the future (Bruce Logan, Penn State).
For eco-entrepreneurs who are not afraid to get their hands dirty and are ready for a challenge, microbial fuel cells might pay off. New strains of microbes, conditions for fuel cells, material for electrodes, electrode shapes, and food for microbes are areas where ongoing research may open new doors and applications. When it comes to the amazing microbes, anything is possible.
Summarizing microbial fuel cell opportunities:
Identifying new fuel cell technology to license and commercialize
Collaborating with researchers to develop new technology, optimizing the microbial strains, electrode shapes, and electrode materials to increase power and reduce costs
Applying fuel-cell technology in novel areas like replacing batteries and powering portable toilets
Using microbial fuel cells to improve the efficiency and reduce the cost of wastewater treatment
OPPORTUNITY 8 Fuel Cell Backup Power
| The Market Need | Replace noisy, polluting diesel generators with better solutions for emergencies and remote locations |
| The Mission | Provide fuel cells for backup power, emergency power, and mobile power |
| Knowledge to Start | Business (to sell and distribute) |
| Capital Required | $$ |
| Timing to Start | Months to years |
| Special Challenges | Finding a product to sell and distribute, and targeting the right market |
Having a constant supply of electricity may once have been a luxury, but now it is an essential part of life. When our electricity fails, the consequences range from an inconvenience to life-threatening. When the power fails, it can mean lost work on the computer, lost food in the refrigerator, or a dangerous loss of power for medical equipment. Electricity has proven unreliable when weather, fires, and equipment failures strain an aging power-distribution grid. With the U.S. grid in desperate need of investment and power demand threatening to outstrip supply, the power supply will remain precarious for some time to come. Eco-entrepreneurs are addressing this need by providing clean backup power from fuel cells.
To avoid power interruption, businesses, hospitals, and many others have invested in backup generators. According to ABI Research, the market for generators in 2007 was more than $6 billion worldwide. Anxiety about an uncertain power supply is expected to drive continued growth for generators from 3 million units in 2006 to 7.1 million by 2011, according to market research group SBI. The market for generators includes backup generators; generators that provide power at remote locations and construction sites; and mobile generators. Engine-based generators running on diesel fuel are loud, polluting, and require constant maintenance to ensure they are ready to go at a moment’s notice.
Fuel-cell technology to generate electricity is well-established. Fuel cells generate electricity directly from chemicals such as hydrogen by drawing the electrons from the fuel and pulling electrons through the system to create a current. Unlike diesel engines that are noisy and burn fuel to produce energy, fuel cells are quiet and shuttle electrons around to produce energy. Even better, when hydrogen is used as fuel, water is the only exhaust. Despite a great deal of talk and big expectations about fuel-cell cars, fuel cells are appearing more quickly in backup power generation.
In general, fuel cells still are an expensive way to produce electricity, which is one of the factors limiting their use in cars. For bulk power generation in the United States, such as using fuel cells as the main source of power for a home or business, fuel cells have a hard time competing with the price of electricity from the grid. But for backup power, fuel cells don’t need to compete; they are on only when the grid is down. That makes backup power a nice niche to start with.
Fuel-cell generators won’t replace diesel generators only for backup power; they will open new markets as well. You cannot run a diesel generator indoors without risking asphyxiation, but this is not a problem with some fuel cells. The Federal Bureau of Reclamation has compared several backup options—including ultra-capacitors, flywheels, batteries, and engines—and found that only fuel cells provide all the desired characteristics. The ability to use kilowatt-size generators in residential homes, office buildings, and other indoor settings will reach millions of additional customers who were previously not part of the generator market.
COMPETING TECHNOLOGIES
Different fuel-cell technologies being developed and marketed include hydrogen and methanol fuel cells. Hydrogen’s storage and supply are not yet routine, leading those in the small-generator markets to continue developing alternative systems that do not require hydrogen gas.
Many fuel cells are powered by hydrogen as a fuel. Hydrogen has many advantages as a fuel. However, the storage and distribution of hydrogen as a compressed flammable gas is not routine. Most homeowners are probably not ready to store compressed-hydrogen tanks inside their homes. Power Air Corp. in Livermore, California, and other companies are searching for hydrogen alternatives, such as zinc fuel cells, that lack these concerns. Power Air’s fuel cells turn zinc pellets into zinc oxide to supply electricity without emissions. In addition, Power Air plans to recycle spent zinc oxide into new zinc pellets, closing the loop. As long as the Power Air system has zinc and air, it keeps producing power and can run indoors without a hitch. Competitively priced fuel cells that can run indoors without hydrogen will find a ready market.
ECO-ISSUE
One big advantage of fuel cells is that they can work at any time. Solar power needs sun, and wind power needs wind, so if it’s not sunny or windy, these options won’t do the trick. Fuel cells turn on with the flip of a switch, day or night, wind, rain, or shine.
Some industries produce hydrogen, making the fuel basically free. HydroGen Corporation of Cleveland, Ohio, is planning megawatt-size fuel cells powered with waste hydrogen from industries such as steel. FuelCell Energy of Danbury, Connecticut, also is developing large, industrial-scale fuel cells with a different chemistry, using molten carbonate.
INDUSTRY INFO
The U.S. Fuel Cell Council supports the fuel-cell industry with resources and information about current developments. Learn more at usfcc.com.
Markets for sales of fuel cells to provide emergency power will include applications that put a premium on uninterrupted power. These would include hospitals, fire stations, police, communications systems, cell phone networks, banks, and information systems. In the paper “The Future of Fuel Cells” (Electrical Construction and Maintenance magazine, March 4 2005), the economics affecting the uptake of fuel cells in the emergency power are discussed, projecting that fuel cells must provide power at $1,000 per kw to achieve sales to more customers, a goal that is fast approaching. According to Wintergreen Research, the market for stationary fuel cells could grow to $17 billion by 2012, as costs decline with increased production volume (“Stationary Fuel Cell Market Opportunities, Strategies, and Forecasts, 2006 to 2012,” Wintergreen Research Inc. 2006, wintergreenresearch.com).
RELATED TREND
Fuel cells also might replace batteries for mobile uses, such as laptops. Methanol fuel cells are a problem to use on airplanes since methanol is flammable. There is an opportunity to invent a fuel cell for laptops using a nonliquid, nonflammable fuel that does not raise objections for airplanes.
The opportunities in fuel-cell backup power include:
Developing new technologies
Distributing new fuel cells being produced
Licensing technology to sell and adjust to new uses, targeting a specific market niche, such as fuel cells for office use, cabins, etc.
Leasing fuel cells and renting them on a short-term basis as mobile power for special events (think green music events and festivals)
Marketing in urban areas worldwide where electrical power is uncertain
Suppling backup power to crucial computing and communication systems
Providing power for emergency response
Setting up cogeneration for fuel cells that produce significant heat, capturing both heat and power to increase efficiency
For all of the fuel-cell technologies, cost is an issue, and reducing costs will open up new possibilities. As long as our power supply remains uncertain, the great number of potential customers afraid of getting left in the dark ensures a bright future for fuel-cell backup power.
OPPORTUNITY 9 Negawatt Installation and Verification
| The Market Need | Increased energy efficiency |
| The Mission | Use markets to stimulate energy efficiency |
| Knowledge to Start | Mechanical, engineering, energy efficiency, green trading |
| Capital Required | $$ |
| Timing to Start | Months to years |
| Special Challenges | The market for negawatts (white tags) is just getting started |
As the economy grows, consumption of electricity also grows steadily, triggering the construction of new power plants and fierce debate about the best plants to build: nuclear vs. wind, natural gas vs. solar, and coal vs. just about anything. There is another answer though, one that often is overlooked: reducing the amount of energy we need in the first place. By most accounts, the United States wastes at least a third of the power it produces while other major economies use power far more efficiently. Entrepreneurs helping consumers waste less energy are freeing up much-needed electricity, saving money, and creating new markets in conserved energy.
These gigawatts of wasted energy are a big problem, but they are also a big opportunity. Robert Wilder of Wildershares Investments (Encinitas, California) has said, “We have Saudi Arabia-sized oil reserves under our feet in America through energy efficiency.” Renowned efficiency expert Amory Lovins coined the term “negawatts” for this often-neglected energy resource.
DEFINITION TIME
One negawatt equals one megawatt of energy conserved for one hour.
Eco-entrepreneurs who turn wasted energy into negawatts of saved energy may unlock the next Saudi Arabia.
Consumers and utilities are partners in wasted energy. Consumers often don’t take advantage of even the easiest ways to stop wasting energy and money, such as changing light bulbs. Utilities generally have made money by selling power, and the more power they sell, the better off they are financially. In this scenario, with little or no motivation for the utilities to encourage conservation, it should not come as a surprise that energy efficiency has not received the attention it deserves.
Conservation can be increased, however. Since the 1970s, the state of California, along with the California Public Utilities Commission (CPUC), has worked with utilities to encourage conservation rather than consumption. As a result, Californians now use about half as much electricity as other Americans. The same measures that increased efficiency in California can work elsewhere; given the right financial incentives, utilities and customers can work together to improve how we use energy.
Realizing we waste energy is the first step, but how can we convert this knowledge into action? The problem does not require waiting for new technologies to be developed. We already have the light bulbs, insulation, double-pane windows and the many other efficiency measures needed to replicate the energy efficiency of California nationwide. What is missing is the right incentives. We need more carrots.
How can eco-entrepreneurs tap into the demand for more efficient energy use? One model is being adopted by demand-response companies such as EnerNOC in Boston, Massachusetts. The price utilities pay for energy can vary dramatically, from $.05 per kilowatt-hour (kwh) to four times as much during peak energy-consumption hours. EnerNOC does not produce or sell power. EnerNOC enrolls energy users into a network and asks them to cut back on use when consumption exceeds the utility’s ability to supply power or when the peak price is too high. Users are paid for enrolling in the program and are paid more if they curtail power when asked.
MEETING POWER DEMAND WITH DEMAND RESPONSE
Demand-response companies coordinate power use by large energy users to help utilities meet the uneven demand for electricity. Demand-response companies include relatively large companies, such as Comverge of East Hanover, New Jersey, and small upstarts such as U.S. West Energy Solutions (Wenatchee, Washington). Also called load management, more and more utilities are turning to demand response to even out the demand for power and avoid brownouts and costly electricity for peak energy demand. ❦
VARIATIONS ON A BIZ-THEME
One cool solution for leveling the load is the Ice-Bear, from Ice Energy (Windsor, Colorado). Using cheaper electricity at the night to make ice, the Ice Bear uses ice rather than electricity to chill refrigerant for air conditioning during the day, reducing their electrical bill.
Another way to encourage energy efficiency is a market-based approach. Things don’t have value unless someone can buy or sell them in a market. If people can take the energy they save and sell it, they may be more willing to invest in energy efficiency. Energy efficiency certificates, or “White Tags,” are being developed as a green trading mechanism to encourage energy efficiency. Each White Tag represents one megawatt-hour of electricity conserved over the course of a year, giving value to the energy that is not used, not just what is consumed. If a business saves energy by implementing efficiency measures, it can get the savings certified and receive White Tags for the negawatts it sends back into the grid.
WHITE VS. GREEN TAGS
Note the difference between white tags and green tags, which are also called renewable energy certificates (RECs). Green tags are tradable certificates connected to the production of renewable energy, selling separately the electricity produced from the environmental value of renewable energy, sold as green tags. Supporting green tags provides a subsidy for the production of renewable energy, and the environmental benefits that renewable energy provides.
Originating in Europe, White Tags have been implemented in the United Kingdom, Italy, and France, and, as of 2007, are spreading to the United States, starting with Connecticut, Pennsylvania, and Nevada. Utilities are required to buy White Tags in these states, and several more states are likely to follow, creating a growing market for trading energy-efficiency certificates.
This is not the first time that market mechanisms have been used to work toward green goals. Acid rain was addressed in the United States using a similar trading mechanism. Sulfur dioxide produced by industrial sources, such as coal-fired power plants, causes acid rain. Rather than impose a restriction for each individual generator of sulfur dioxide or telling users how they must fix the problem, the government imposed a cap on the overall production of sulfur dioxide and let the market find the most cost-effective solutions. Companies that emitted less sulfur dioxide received credits to sell to those who did not reduce their emissions. This market-based solution for acid rain reduced sulfur-dioxide pollution faster and more cheaply than originally expected by allowing the market to find the best, most cost-effective solution. Similar trading of carbon emissions is under way in Europe and the United States.
INFORMATION RESOURCE
See more about how White Tags work at sterlingplanet.com. The site also has a wide range of information about energy markets, including renewable-energy credits and offsets.
Although the concept of negawatts has been around for a while, creating a viable market has taken some work. Companies such as Sterling Planet are helping to create markets for White Tags, encouraging future energy efficiency. According to Kelly Bennett, vice president of White Tags at Sterling Planet: “We serve as an intermediary in the marketplace, a retailer. We buy White Tags from owners of efficiency projects and match them up with buyers such as utilities that are required to purchase energy-efficiency certificates.” Other buyers include individuals who want to buy offsets, or corporations or colleges that have set greenhouse-gas reduction targets and want to use market tools to help meet them. Creating their own efficiency projects is the best place to start reducing greenhouse gases, but White Tags can help them have even more of an impact in a cost-effective manner.
ECO-ISSUE
Sterling Planet has designed software to measure and validate the energy savings required to receive White Tags, solving one of the biggest obstacles keeping this market from taking off.
Bennett observes that the White Tag market is early in its development, but that it is “very much a growing market in response to our need to curtail additional generation, make individual homes and businesses more efficient and productive, and reduce carbon. Carbon is one of the big drivers.” The growth of White Tags does not depend entirely on government action, it is also growing through voluntary use by those who want to do the right thing for the environment. “No matter what happens on the compliance market,” Bennett says, “with the rules in place, there is an appetite in the voluntary market to use White Tags in the same way as renewable-energy certificates.”
IN THE LONG RUN
A general concern is that if White Tags are implemented on a state-by-state basis, they will be difficult to trade because the rules will vary. Having a single, large market determined by federal rules would help this market grow and make it easier for markets to work. The experience of states starting to implement White-Tag markets can help regulators and industry leaders fine-tune future White-Tag efforts. ❦
RELATED TREND
In states that already are implementing White-Tag markets, there is nothing preventing homeowners from certifying their efficiency measures and selling white tags. For this to work, a large number of small projects need to be grouped together by an aggregator who could then deliver the tags to the marketplace.
One accessible opportunity is with an energy services company, which makes efficiency modifications in buildings and industrial settings. Knowledge of mechanical and building systems is needed. Projects start by auditing buildings and businesses, suggesting a plan for saving energy, and carrying out this plan. Similar opportunities exist in verifying and certifying efficiency projects. White Tags are a unique product; when you pay someone for not using power, the verification of projects is crucial. Finally, an opportunity that grows with the increasing size of the market and volume of transactions is facilitating market transactions from business to business, or business to other organization. “There will be lots of middlemen in all of these transactions,” Bennett observes.
Implementing efficiency as an energy services company
Verifying efficiency projects
Certifying efficiency projects
Serving as on aggregator of smaller efficiency projects to deliver them to the market
The opportunities for negawatt installation and verification include:
It’s still early days for White Tags in the United States. Everybody wants energy efficiency, and harnessing markets with White Tags might help make it happen. By selling White Tags, businesses can more rapidly pay off the investment they make in energy efficiency and justify the improvements more easily based on the rapid return on investment, a hurdle often encountered on the path toward energy efficiency. The growing trading market for White Tags will change minds about the value of energy efficiency and transform how we use energy—being negative can have a very positive impact on the environment and business.
GREEN LEADER
Peter Fusaro of Global Change Associates, New York, New York, is an expert on green trading, including White Tags and Green Tags, and the many successes and challenges of these markets. See his classes for in-depth knowledge about green trading (global-change.com).
OPPORTUNITY 10 Solar to Go
| The Market Need | Mobile power, freeing people from the power grid |
| The Mission | Build solar into a ubiquitous mobile power source |
| Knowledge to Start | Solar, electrical, design, engineering |
| Capital Required | $$ |
| Timing to Start | Months to years |
| Special Challenges | Finding a specific need and designing the right product for the market |
Many people today are always connected electronically, never without an iPod, smart phone, or other gizmo in their ear or face. I suspect they sleep plugged in, their dreams piped in electronically. The older end of this group has their BlackBerry mobile e-mail always on, always on the go. In the United States and other countries, many have abandoned a regular phone line, using instead a cell phone as their main telephone number.
With electronic gear increasingly integrated in our lives, electrical cords have become our lifeline. The horror of running out of juice looms large, and we worry about getting our next hit of electricity. Next time you are at the airport, notice those feverish power junkies clustered around stray electrical sockets with their phones and laptops.
Now imagine a life free from the constraints of this umbilical connection to the electrical grid. Solar solutions set us free. Mobile solar panels in a variety of formats are being developed and marketed to provide power for laptops, iPods, cell phones, and other electronic devices.
Who is the market for this solar-powered gadgetry? Young, urban, and on-the-go is one group—electronic devices are an integral part of their lifestyle, and the more integrated the power can be, the better. Outdoors enthusiasts are another group. They also have their mobile global positioning system (GPS) devices, radio, cell phone, and other devices that need a charge. As new solar technologies such as high-efficiency flexible panels or organic solar emerge, so will the opportunities to license these technologies to provide mobile power.
RELATED TREND
Maybe the Climate Savers Computing Initiative will solve the laptop power problem, encouraging the development of more energy-efficient laptops that can run with 30 watts or less. The less power that laptops need, the better solar chargers will work with them.
Another market being addressed is laptop chargers—most laptops still have limited battery life, defeating the idea of a mobile computer. Imagine being able to take your laptop anywhere without worrying about running out of juice? The Solaris solar charger from Sierra Solar Systems is one solution, providing 15 or 22 watts of power, enough to charge a battery or run a low wattage computer.
One challenge is to get enough watts out of a charger to supply a laptop. The wattage supplied by a solar-power system depends on its size, efficiency, and how much light is hitting it. Because the amount of power collected is proportional to the surface area exposed to the sun, mobile solar panels are often designed to fold out to open to the sun. Solar power systems usually are rated according to the maximum level of energy they can supply in strong daylight. Typically laptops need 60 watts of power, so running a laptop from the charger would require at least this much. Panels are still expensive, and there is some pressure for mobile chargers to be small, so current solar laptop chargers usually generate 30 watts or less. A system like this can charge the battery given enough time but is not strong enough to power the computer. Either the chargers need to get stronger or the laptops need to use power more efficiently (or both).
Integrating solar power into electronics is one business opportunity. Sometimes this is as simple as matching solar panels and electronic devices together and selling them as a package. In other cases, integrating solar into electronic devices will take some design work. Keep your eyes and ears open, and your Google skills sharp, to find and sell great new solar gadgets before everyone else.
Smaller devices are easier to charge because they require less power and therefore smaller, less expensive solar chargers. The iSun is an iPod charger, and Solio (Berkeley, California) makes a popular cell-phone charger. Powerfilm of Ames, Iowa, already makes the R15-600 9 watt, 12V solar charger (hey guys, I think you need to work on its name) using a thin film technology. As a thin film, this charger is flexible and can be rolled up to make it easier to carry.
Taking mobile solar power to the next level may require new technologies, such as flexible thin films; using these a new generation of flexible thin-film solar can be built into clothing, briefcases, bags, and bikes. Thin films still are expensive for your roof, but for niche electronics applications, the cost of the panel is less of a factor. New technologies with higher efficiencies probably will be more expensive when first introduced and may find their first uses in electronic devices rather than rooftop solar panels.
INNOVATION TO GO
One opportunity might be using solar-concentrator technology in the mobile solarcharger market. Using a reflective surface to capture more energy might keep the cost down, minimizing the amount of actual photovoltaic material required, solar concentrators are gaining interest for other applications and might be useful here as well. ❦
One limitation for mobile solar chargers is that they will require users to pack another item adding weight and complexity to the trip. Who wants to carry another bag with your laptop? What really makes consumers go gaga is an innovation that makes power a given, something they do not have to think about, something built right into the device. Integrating solar in a device means never having to say your battery is dead. Calculators have been this way for a long time; why not your blender or other household appliance? More and more items that today are powered by batteries or plugged in with a cord will run off solar power in the future. Think LED (light-emitting diode) flashlights with solar panels on the handle. Because you usually don’t use a flashlight every day, having it charge slowly may be enough for it to be ready when needed (as long as it is not in a drawer or closet).
A few of the opportunities for mobile solar power include:
Developing solar bags and briefcases
Integrating laptop solar chargers with high-efficiency laptops
Using small solar panels in electronics and small appliances
Retailing solar gadgets
Ultimately, power should be so integrated that it just happens without any thought. Batteries never run out because solar recharging is built into the devices. Going green in this case means freedom—freedom from the grid, and freedom to use gizmos whenever and wherever you want. As long as the sun shines and the urban WiFi never fails, you can sit in the park Googling all day long.
