Transcript Lecture33(Gerbis)

Innovation & climate change
Igniting the Next Industrial Revolution
by
Michael Gerbis, P.Eng.
President, The Delphi Group
DELPHI
Overview

The Delphi Group

Climate Change – where are we?

The New Carbon Marketplace
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Thinking Out of the Box!

Attributes to Thrive and Survive
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Discussion
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The Delphi Group
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In Business since 1987
 “Catalyze Change Through Innovative
Strategies that Generate Environmental,
Social and Financial Dividends”
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Environment & Clean Energy Technologies

Climate Change & Sustainable Energy

Health and Environment

EXCEL, EECO, GLOBE and Corporate
1997 – 2001 Tripled Size and Revenues
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THE GREENHOUSE EFFECT
Incoming Energy
Reflected Energy
Outgoing
Energy
Energy Trapped
By Greenhouse Gases
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International consensus
1.
Earth is warming


7 of 10 warmest years on record in the 1990s
IPCC projected range 1.0 - 3.5º C over next 100
years
2.
Discernible human influence
3.
Trend to Continue Resulting in Impacts
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more extreme weather events (insurance!!)
human health, environment, economy, ocean levels,
river and lake systems, agriculture, tourism…
Canada more affected than most countries because of
its large size & northern land mass
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Impacts of Climate Change
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Climate Change

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UNFCCC (1992)
The Kyoto Protocol (1997)
 Agreed to 5.2% reductions of GHG
CO2, CH4, N2O, HFC, PFC, SF6
 Flexibility Mechanisms (CDM, JI, IET) & sinks

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Critical Dates & Timelines
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1990 baseline
1998-2008 transition period
2008-2012 budget period
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CANADA’S EMISSIONS PROJECTION
AND THE KYOTO TARGET
850
MT CO2 - equivalent
800
750
764
700
682
650
694
600
550
199 Mt
or
26%
601
500
565 Kyoto target
six percent below 1990 level
Forecast
450
1990
1995
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2000
2005
2010
2015
2020
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Projected GHG EMISSIONS BY
PROVINCE
MT CO2 - equivalent
260
240
220
200
180
160
140
120
100
80
+23%
60
40
20
0
1990
2010
+40%
+17%
+10%
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+40%
+38%
+24%
DELPHI
Pathway to sustainability
North American and European Markets For
Environmental Goods and Services
Level of
Industrial
Purchasing
Activity
Stage 1:
Auditing and
Compliance
Stage 2:
EMS and
ISO 14000
Stage 3:
Environment
and Business
Integration
Stage 4:
Sustainable
Development
Drivers
Source: The Delphi Group, 1998
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The Path to Sustainable
Energy
BIOMASS
• Dung
• Wood
FOSSIL FUELS
Coal
• Straw
Renewables
Oil
• Solar
Natural
Gas
nuclear
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• Wind
?
• Biomass
• Fusion
• Geothermal
• Hydrogen
• Tidal/wave
DELPHI
The Emerging
“CARbON MARkETPlACE”
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Economic
Growth
Capital
Stock
Turnover
International
Finance
Institutions
Kyoto
Flexibility
Mechanisms
Climate
Change
Mitigation
Measures
Demand for
Climate
Change
Solutions
Health and
Air Quality
Benefits
Energy
Security and
Interest in
Renewables
Corporate
Competitiven
ess and
EcoEfficiency
Energy
Market
Liberalization
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Converging Forces
Trend towards
Sustainable Energy
Rapid Innovation
Global Energy Market
Reform
Concern over health
impacts
Kyoto Potential
Opportunity & Risk
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The Product of
Convergence
Air Pollution Reduction
Quantity
GHG Reductions
Reduced Health Effects
The Right Choices
More
Sustainable
Practices
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Eco-Efficiency

Pollution
Prevention

Clean Energy
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Triple Bottom Line
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corporate Risks
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“Uncertainty Factor”
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Int’l Process “Devil’s in Details”
National Leadership (lack thereof)
Cost, cost, cost…benefits?
Rate of Return & Price of Credits Unknown
“Share-Value Exposure”
 Differentials in GHG emissions
 Decreasing Value of Capital Stock
 Production, expansion, acquisitions
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Relative Impact on Global Competitors
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Corporate Opportunities

Gain Competitive Advantage


Productivity, Energy Efficiency
Differentiate Yourself from Competitors
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Hedge Your Bets – Offset Future Risk
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Added Value through Offset Credits
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Diversification

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Leverage technology and R&D
Exploit new markets
Create new value-added business ventures
Enhance Shareholder Value
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Leaders & laggards
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Four Levels of Action
 Strategic Integration
 Sitting on Fence (Baselines Being Done)
 ‘Not on the Radar Screen’ Yet
 Moving against the flow

Leaders Moving Ahead
 BP, Shell Int’l, Transalta, DuPont, Suncor
Energy, OPG, Alcan, Dofasco
 Cities of Toronto, Calgary, Banff, Halifax
 Denmark, UK, Netherlands
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Emerging Innovation
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600 diversified firms
Generally High-tech
solutions
Strong R&D
$3 billion & 23,000
jobs
Global Market
between $150 - $400
billion
Increasing 5%/yr
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EcoEfficiency
Building
Design &
Operation
Advanced
Materials
Climate
Change
Companies
Biotech
Renewable
& New
Energy
E-Commerce
DELPHI
Many companies see
opportunities
Fuel Cells
Buildings
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Future Fuels
New Processes
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So What Does This Have to
Do with me?
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New Business Realities => Next Industrial
Revolution*
 Radical Increases in Resource Productivity
 Biomimicry
 Evolution From Manufacturing to Service and Flow
Economy
 Increasing Investment in Natural Capital
*Taken from “Natural Capitalism” by P. Hawken, A. & H. Lovins
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Industry
“ThINkINg OuT Of ThE bOx”
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Interface – New Factory in Shanghai had a 92%
energy saving by new design
 Looked at whole pumping system and discarded old
style of economics
 Sized pumps based on large pipes rather than small
pipes (50% increase in dia = 86% drop in friction)
 Installed pipes first then equipment
 12 fold reduction in energy, simpler and faster
construction, less floor space, easier maintenance, and
better performance (e.g. saved 70 kW of heat loss)
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*Taken from “Natural Capitalism” by P. Hawken, A. & H. Lovins
DELPHI
Buildings
“ThINkINg OuT Of ThE bOx”
The International Netherlands Group (ING) Bank
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540,000 ft2
Strong Vision & a
Multidisciplinary Team
3 Year Process – Everyone
Had to Understand
Everything
Added Capital = $700k
Annual Energy Savings of
$2.9 mil (1996) / 1/10th
15% reduction in
absenteeism
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*Taken from “Natural Capitalism” by P. Hawken, A. & H. Lovins
DELPHI
Transportation
“ThINkINg OuT Of ThE bOx”
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Whole-system
design
ultra light; low-drag;
hybrid-electric;
efficient accessories
3 to 5 x better fuel
economy
equal or better
performance, safety,
affordability
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http://www.rmi.org/sitepages/pid386.asp
*Taken from “Natural Capitalism” by P. Hawken, A. & H. Lovins
DELPHI
“ThINkINg OuT Of ThE bOx”
Maunsell – Aberfeldy Golf Club Footbridge Bridge
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Major span – 63 m
1st major advanced
composite footbridge
Maunsell worked with
Dundee Univ.
engineering students
who provided the bridge
erection team.
Assembled in 10 weeks,
no craneage, minimal
foundations, 20 yr
maintenance schedule
DELPHI
“ThINkINg OuT Of ThE bOx”
Clean Development Mechanism (CDM)
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Market-based mechanism:
–
Assist Annex 1 countries to comply with
their reduction targets under Kyoto
– Increase rate of return, financial
attractiveness
– Reduce risk and enhance markets

Sustainable Development
–
–
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Build developing country capacity
Transfer state-of-the-art technologies
Environmental and health co-benefits
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Attributes to THRIVE
& survive
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Breadth of Understanding
 Strong technical skills
 Business Savvy – but it’s not just about


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old style economics
Interpersonal & Communication Skills
Ability to Think Out of the Box (and assess
different perspectives)
Work within a “Fear of Change”
Be Adaptable
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“ThINkINg OuT Of ThE bOx”
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“ThINkINg OuT Of ThE bOx”
“Innovation is not always about
having a new idea, more often it’s
about stopping having an old idea."
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The Delphi Group
For More Information Contact:
Mike Gerbis, P.Eng.
President, The Delphi Group
428 Gilmour St.
Ottawa, Ontario K2P 0R8
Tel: (613) 562-2005 Fax: (613) 562-2008
email: [email protected]
Website: www.delphi.ca
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DELPHI