Welcome to Blue Green Canada's Green Economy Review, our monthly round-up of green economic developments across the globe. If you are a new subscriber, you can find past issues here.
In this issue:
Last month, the United Nations Environment Programme (UNEP) released a groundbreaking report entitled, “Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication.”
The principle finding: 2% of global GDP, $1.3 Trillion annually, is enough to kick-start the transition to a green economy. According to the report, a green economy will deliver higher rates of economic growth and employment over the long term and result “in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities.”
Citing a “gross misallocation of capital,” the report makes a number of policy recommendations in ten sectors of the economy: agriculture, buildings, energy supply, fisheries, forestry, industry including energy efficiency, tourism, transport, waste management and water.
It may seem odd to some that the UN Environment Programme would focus on the economy but, as the authors note, “there is now a growing recognition that achieving sustainability rests almost entirely on getting the economy right.”
The good news is that the transformation envisioned by UNEP may be closer at hand than many realize. According to a new report called the Green Transition Scorecard, from 2007 to 2010, over $2 Trillion in private capital was invested in green companies and technologies. This sum does not include government investment.
As further evidence of green transformation, green jobs are starting to crop up in large numbers. A report out of the U.S. concluded that over $1 million green jobs have been created there over the past few years. And positive reports are coming out of the U.K., too, as employment in off-shore wind development continues to surge, up 91% over last year. South Korea is also boasting a robust clean energy sector. The Ministry of Knowledge Economy reported the industry’s sales jumped 58 percent to 8.12 trillion won (US$7.23 billion) in 2010.
The U.S. is moving decisively toward a green economy, pouring billions of dollars into clean energy, energy efficiency, electric cars and biofuels, and working to rebuild their manufacturing sector around green energy.
According to recent reports, the Recovery Act has created one million green jobs and new legislation proposed by the U.S. EPA is expected to create up to 1.4 million more. Obama’s Better Buildings Initiative, announced last month, is also expected to create significant employment.
Although their climate change legislation failed to get through congress, the green economy is not as divisive an issue as some might think. Many Republicans support clean energy with an equal if not greater sense of urgency than their Democratic counterparts and the GOP may have a green strategy of their own.
There may be other factors at play in U.S. support for green energy and manufacturing. The U.S. intelligence community is reported to be worried about the security implications of their declining manufacturing sector. And revolutions and political turmoil in the Middle East are strengthening the case for American energy independence.
Ontario’ Green Energy Act continues to attract clean energy manufacturers. Last month, Celestica opened a Toronto facility, Ontario Solar Manufacturing (OSM) opened a facility in Welland, and Fort Erie based wind tower manufacturer, DMI Industries, added to their workforce to meet demand for Ontario-made towers.
The Act is also spurring economic development and attracting interest from afar. In February, representatives form Ontario municipalities were in Pheonix to promote Ontario as a clean energy hub, while at the same time representatives from municipalities in Alberta were touring Ontario communities to learn about their successes with economic growth and green energy.
Also last month, Ottawa was added to the list of municipalities taking part in the FIT, when the local City Council approved a plan to install solar arrays on municipal buildings.
Finally, the green jobs created thanks to the Green Energy Act are proving to be in demand. When Canadian Solar hosted a job fair at their Guelph facility where they will eventually employ some 500 people, over 1000 would-be employees showed up to apply for the jobs.
Unsurprisingly, the soaring levels of investment in the green economy are generating profits.
Shares in both Chinese and American solar panel manufacturers rallied last month thanks to sustained demand, stimulated in part by the passage of renewable energy legislation in California. Other green sectors are also doing well and analysts are bullish on lithium for it’s energy storage potential, green energy stocks, and investments in infrastructure to support the rollout of electric vehicles across the U.S. Some analysts are also predicting good value in geothermal power shares. Geothermal holds great potential but hasn’t received the same level of interest as other renewable energies.
More businesses are also recognizing that it pays to be green, as is evidenced by the UK-based Co-operative Group’s announcement last month that they intend to set a new “benchmark for corporate responsibility.” Among other things, the member-owned cooperative which runs supermarkets, banks, pharmacies, car dealerships, travel agencies and more, intend to cut their carbon emissions 35% by 2017, invest £5 million a year to tackle poverty around their stores and branches, and purchase 90% of their developing-world commodities from Fair Trade suppliers.
This month also saw a series of announcements that illustrate the extent to which green is becoming increasingly mainstream. Among them:
- Rupert Murdoch’s News Corporation has become carbon neutral
- Solar panels will be installed on the New York Jets’ training center
- A plan was hatched to build a solar array at the Arizona Diamondbacks’ Chase Field in Phoenix, which will generate 75 kilowatts of solar power and shade fans waiting in line.
- Solar panel kits will soon be available in some U.K. supermarkets.
- The Empire State building is going carbon neutral
- And here in Ontario, Dad’s Cookies’ manufacturing facilities in Scarborough and Etobicoke have signed up to run their facilities on green energy purchased from Bullfrog Power.
Countries around the world are deploying a variety of green energy strategies as they seek to create jobs, stimulate their economies, and curb emissions. Among the notable announcements from last month:
- Rio de Janeiro is reported to be contemplating the creation of a carbon market
- Saudi Arabia is seeking money from the climate aid fund, which was born out of last year’s climate negotiations in Cancun.
- The Kenyan government is taking steps to reduce vehicle emissions.
- U.K businesses are crying foul and some are threatening to sue in response to changes to the country’s feed-in tariff.
- South Africa’s Industrial Development Corporation (IDC) committed to invest R10bn to establish a green energy industry.
- The Algerian government announced plans to increase the share of renewables in its energy mix to 40% by 2020, as part of a plan to create 100,000 jobs over the next 20 years.