Green Wombat

Greed is green

It is an article of faith these days that any company worth its public relations budget must proclaim loudly and frequently its good green intentions. So it was rather refreshing to hear one of Richard Branson’s top lieutenants – Will Whitehorn, chief of Virgin Galactic – cast his company’s enviro-friendly initiatives as strictly business.

“We’re not doing this to be environmentally kosher,” declares Whitehorn, referring to Virgin’s efforts to develop greenhouse-gas free biofuels for its jets and forthcoming spaceship, “we’re doing this to ensure our company’s survival.”

The occasion for Whitehorn’s remarks was one of those “green salons” that have become popular in San Francisco of late. You know, gather a group of so-called thought-leaders – executives, environmentalists, venture capitalists, journalists – in a chi-chi restaurant and let the ideas and sauvignon blanc flow. Easy enough to skewer, particularly when the well-compensated are dining on ahi tuna skewers, but you never know where the conversation will go, and in this case it strayed interestingly off-topic. The subject du jour was a white paper on corporate greenwashing from Bite Communications, the public relations firm that organized the recent lunch. Among those on hand were Whitehorn and exes from Chinese solar panel maker Suntech (STP), fuel-cell maker Bloom Energy, utility PG&E (PCG), and VantagePoint Venture Partners, investor in electric car startup Tesla Motors and solar power plant builder BrightSource Energy.

Whitehorn held center court, tracing Virgin’s trip down the green path back a decade when the company forecasted a dramatic rise in oil prices and tried to gauge the impact on its airline and new railway business. As a result, he says, Virgin spent big bucks on energy-efficient locomotives to hedge against future fuel cost spikes.

“This is not really a question of being green,” says Whitehorn, who expresses annoyance that Branson’s pledge last year to invest $3 billion in biofuels research and development was portrayed in the media as a charitable deed. “We’re doing this to make money and we’re creating a more sustainable economy in the process.”

“We’ve got to get away from this idea of doing these things as good works,” he adds. “We’re doing what we’re doing to create a profitable business for the future.”

It’s a meme increasingly being advanced by some environmentalists, most notably by the black sheep of the movement, Ted Nordhaus and Michael Shellenberger, whose 2004 essay, “The Death of Environmentalism” riled the green elite. The Berkeley duo’s new book, Break Through: From the Death of Environmentalism to the Politics of Possibility, calls for reframing global warming from a doom-and-gloom scenario to an opportunity for unbridled economic prosperity by investing in green technologies. Their central argument: only when people and societies achieve a certain level of material wellbeing do they have the luxury of supporting environmental preservation. In other words, greed is green.

Whitehorn also took aim at companies that proclaim themselves carbon neutral, scorning the notion that corporate greenhouse gas emissions can be offset by merely buying carbon credits. “We’re not going to be carbon neutral – it’s impossible,” he says of Virgin. “You need to get out and do something other than buy someone else’s carbon problem.”

Still, Kristina Skierka, director of Bite’s cleantech practice, wanted to know just how green can Virgin Galactic be, given its business model of ferrying the rich into outer space for a couple hundred grand a pop. “If we use biofuels we will get the emissions down to near zero,” Whitehorn claims. “This is about a new type of launch system; the carbon impacts will be negligible.

He says space tourism is just the launching pad, as it were, for a host of space-based ventures. “If you look at space as an industrial place to conduct human activities, it has huge advantages.”

Virgin’s next frontier is the deep blue sea. According to Whitehorn, the company recently created a skunk works to develop a “radical” new submarine technology for a startup to be called, what else, Virgin Oceanic.

HP greens the bottom line

Overshadowed by Google's jump into the renewable energy business on Tuesday was Hewlett-Packard's more modest move to go green by installing a 1-megawatt solar array at its San Diego facility, buying wind power for its Ireland operations and subsidizing employees' home solar systems.

In Silicon Valley these days putting a whopping solar array up on your roof is akin to having the coolest corporate jet or your CEO back-ordered for a Tesla Roadster. Google (GOOG), of course, has the biggest, a 1.6-megawatt monster that covers buildings and carports at the Googleplex in Mountain View. Not to be outdone, Applied Materials (AMAT) is planning an even larger solar system for its headquarters in neighboring Santa Clara.

But there's more at stake here than green bragging rights. Companies like HP (HPQ) are realizing that tapping renewable energy can also be good for the bottom line. Take HP's solar array in San Diego, for instance. The 5,000-panel system carries no capital costs for HP as the array will be financed and operated by a third-party affiliated with solar cell maker SunPower (SPWR). The Silicon Valley company will install the array and perform maintenance for 15 years while HP purchases the electricity produced by the solar system at a guaranteed below-market rate. That gives the company a hedge against rising energy costs. (HP thinks it'll save $750,000 over 15 years.) HP also retains ownership of any potentially marketable renewable energy credits associated with the array while the financier can take advantage of California’s solar subsidies.

SunPower wasn't disclosing the identity of that financier when Green Wombat inquired on Tuesday, but this morning the company announced a $200 million deal with Morgan Stanley (MS) to provide financing for solar installations and power purchase agreements like the one HP signed. SunPower and Morgan Stanley have formed a jointly owned holding company to finance SunPower's solar systems for customers, with the Wall Street firm kicking in up to $190 million and SunPower putting up as much as $10 million.

In Ireland, HP will buy a year’s worth of clean electricity generated by Airtricity’s European wind farms, saving the company an estimated $40,000 in 2008. Electricity generated by Airtricity’s wind farms is fed into Ireland’s national power grid rather than directly to HP facilities. But the additional power generated by the wind farms, as well as the solar electricity eventually produced by the San Diego array, will eliminate tons of greenhouse gas emissions from the atmosphere.

Last, SunPower will give HP employees a $2,000 rebate if they install the company’s residential solar systems, with HP providing another $2,000. That’s on top of state rebates under the California Solar Initiative program.

Sun Investors Go Paperless

Back in August, the U.S. Securities and Exchange Commission ordered public companies to make most proxy materials available online and notify investors they could access those documents at corporate websites. For Sun Microsystems, the rule has been a boon for the environment and the bottom line. More than 90 percent of Sun's (JAVA) investors preferred to view the docs online, according to the Silicon Valley computer and software company. That meant Sun was able to slash the number of printed copies of proxy materials for its 2007 annual shareholders meeting from 800,000 to 75,000.  Printing nearly 100 million fewer  pages translates to saving 11,964 carbon-absorbing trees, according to the Environmental Defense Paper Calculator.

A Corporate Social Network for Carbon Disclosure

Sun Microsystems today unveiled a web site where corporations can share greenhouse gas emissions data. A cross between a social networking site and an open-source software platform, OpenEco aims to encourage companies to collaborate on the best strategies for taking carbon out of their operations. Sun's (JAVA) software lets companies upload greenhouse gas data from spreadsheets and other corporate documents, set greenhouse gas reductions targets and track their progress. Crowdsourcing  carbon is an intriguing idea but the big question is whether companies will be willing to give competitors an inside look at their operations. Some clearly will. Sun and chipmaker Advanced Micro Devices (AMD) have revealed their carbon footprint while Google (GOOG) has calculated and verified its greenhouse gas emissions but closely guards that data for competitive reasons. So far the only organizations to sign up with OpenEco are Ceres, a coalition of investors and public interest groups focused on environmental issues, and Natural Logic, an environmental consulting firm. Still, pressure is growing on companies to drop the corporate veil when it comes to global warming. Today the Carbon Disclosure Project - a non-profit that collects greenhouse gas emissions data from major corporations - reported that a record 77 percent of companies responded to its annual survey this year.

Fujitsu's Hydrogen-Powered Silicon Valley Campus

photo: UTC Power
Google (GOOG) has its 1.6-megawatt solar array and Applied Materials (AMAT) is following suit with an even bigger solar installation at its Silicon Valley headquarters. Not to be left behind in the greening of the valley sweepstakes, Fujitsu says it has become the first SV company to power its operations with a fuel-cell generator (photo at above). The Japanese computer maker today is unveiling a 200-kilowatt fuel-cell at its Sunnyvale campus that it says produces half the carbon dioxide of a conventional power plant. The generator, made by UTC Power (UTX), reforms natural gas to produce hydrogen which is then used to generate electricity. Besides emitting far less greenhouse gases than a fossil-fuel power plant, fuel-cell generators do not produce pollutants like nitrous oxide and sulfur oxide.  The fuel-cell will provide half the power needed to cool the Sunnyvale campus's data center.  The hot water generated by the fuel-cell in turn will be used for heating. The project won Fujitsu a $500,000 incentive payment from utility PG&E (PCG).  Fun fact: The UTC fuel-cell generator can be hooked up to a wastewater treatment plant and an anaerobic digester to tap methane gas from what we'll politely call effluent to produce hydrogen.

Green Sheen: Make Yahoo an Environmental Icon

photo: green wombat
Green Wombat's in meetings today, but driving down the 101 this morning I got a glimpse of Yahoo's 100 percent biodiesel-powered Green Guzzler employee shuttle bus in the rear view mirror before the BlackBerry buzzed with news of the purple portal's latest green marketing campaign: a contest  to design a green icon to flag enviro-related products and services on the company's network. The winner gets $20,000 to donate to the environmental group of his or her choice. The two runners-ups' green groups will each receive $5,000. And Yahoo (YHOO) wins a crowdsourced logo for a fraction of the price a high-concept graphics designer would charge.

AMD's Ambitious Climate Change Plan

Years before green became the new black, Advanced Micro Devices began setting greenhouse gas reduction targets. Today the computer chip maker released its seventh annual Global Climate Protection Plan, announcing it had reduced greenhouse gas emissions by more than 50 percent between 2002 and 2007 - exceeding its 40 percent goal - and setting a new target of cutting emissions another 33 percent between 2006 and 2010. AMD (AMD) also aims to slash energy use 40 percent by 2010. Planet-warming emissions fell a whopping 68 percent between 2005 and 2006, largely due to AMD's spin-off of its Spansion flash memory chip subsidiary, which allowed the company to cease counting its CO2 contributions.

In the long run, AMD's biggest impact on global warming will come from its focus on making energy-efficient chips that power computers and servers. But AMD's detailed disclosure of its greenhouse gas emissions and plans for operating in a carbon-constrained world are road map of sorts for companies that increasingly will find themselves under regulatory pressure to do what AMD now does voluntarily. It's a tricky issue - companies like Google (GOOG) and AMD arch-rival Intel (INTC) have embraced corporate sustainability but are leery of the competitive impact of detailing their carbon footprints. Others, like Sun Microsystems (SUNW), have been more forthcoming. With California and other states imposing greenhouse gas caps and a national limit on emissions looming, transparency will be the new green. Companies will not only reap the public relations benefits of such disclosures and any carbon credits that might be associated with big greenhouse gas reductions but may even learn a thing or two from each other.

In that spirit, here's a  few highlights from this year's AMD climate change report:

• AMD's global operations emitted total 94,062 metric tons of greenhouse gas equivalents in 2006.
• Eighty-nine percent of the emissions came from energy use.
• The company analyzed the distribution of some of its products and relocated facilities to reduce the distance goods must be transported to buyers. For instance, AMD discovered that half the buyers for its "processor-in-a-box" were on the East Coast, and so this year will move the distribution center for that product from California to Florida, eliminating an estimated 676,000 air miles used for product transportation. Relocating another distribution center from California to Texas will save an estimated 124,800 air miles.
• AMD is incorporating green building design into its new campuses and manufacturing plants and retrofitting old ones to reduce energy consumption and greenhouse gas emissions. It's also locating those facilities near public transportation to reduce commute-related emissions. AMD's new Austin campus will be powered by renewable energy purchased through utility Austin Energy's GreenChoice program.

Sun Shines Light on its Carbon Footprint

After Green Wombat blogged this week about Google's (GOOG) reluctance to disclose its carbon footprint for competitive reasons, Sun Microsystems' Erica Jacobs emailed to say that the Silicon Valley computer and software maker publicizes its greenhouse gas emissions on its Web site. Sun (SUNW) is still calculating its worldwide carbon footprint, but the company lists its major U.S. facilities along with their individual electricity and natural gas consumption and resulting greenhouse gas emissions. In March, for instance, the eight facilities - which are responsible for about half of Sun's global emissions - produced 10,515 metric tons of greenhouse gases. The company, which has pledged to reduce its greenhouse gas emissions 20 percent below 2002 levels by 2012, says 90 percent of its carbon footprint comes from energy usage. "We believe efforts like this start with showing all the warts so we can identify starting points, help each other improve and solve the problem," wrote Jacobs, Sun's PR manager for Eco Responsibility.  The eight facilities represent cubicle farms, data centers and manufacturing plants, according to Jacobs. She said Sun will update its emissions reports monthly and begin adding more data to allow month-to-month and year-to-year comparisons.

Google's Carbon Footprint

At yesterday's Climate Savers Computing Initiative press conference at the Googleplex, a Forbes reporter asked Google exec Urs Holzle to disclose the size of the search giant's carbon footprint, noting that the company's good green deeds notwithstanding, its executives still fly on private planes and so forth. (Larry Page, who had just flown in from Africa, was sitting in the front row.) Holzle, a vp for operations, rattled off a list of Google's (GOOG) efforts to cut its greenhouse gas emissions - installing the world's largest corporate solar array, its generous subsidies for employee purchases of hybrid cars, etc. - but declined to reveal the company's overall greenhouse gas emissions. "Our carbon footprint is actually not that big," he said. "We have 10,000 employees. Even at this scale, we care and want to be a model citizen. But we’re not quite ready to tell you what we’re doing."

Another example of corporate hypocrisy or Google's penchant for secrecy? Not really. Disclosing corporate carbon footprints is a tricky issue. If you're a financial services firm or a software company, you might be quite happy to make public your greenhouse gas emissions from what is essentially office work. If you operate huge server farms around the world and are locked in cutthroat competition with the likes of Yahoo (YHOO) and Microsoft (MSFT), such disclosures are more problematic. "Our carbon footprint is too close to information that is competitive," Google energy strategist Bill Weihl told Green Wombat during a post-press conference chat.  In other words, Google worries that competitors could reverse engineer its greenhouse gas data to figure out how many servers and data centers it operates - figures that the company keeps locked in a black box. Weihl says that Google has calculated its carbon footprint and has had the numbers verified by a third party. Which third party? He said he couldn't reveal that at this time.

The Forbes reporter put the same carbon footprint question to Intel's Pat Gelsinger, who referred to a white paper on the company's site. While the paper details Intel's (INTC) many technological efforts to reduce its CO2 emissions, Green Wombat could not find a snapshot of the chip giant's overall carbon footprint.

One thing is clear, however: Pressure for companies - especially those that portray themselves as green - to reveal their greenhouse gas emissions will only grow in the years ahead. California will require such information to be disclosed for some industries to implement its statewide cap on greenhouse gas emissions; a national registry is likely to follow at some point as part of Congressional global warming legislation. And being upfront about your carbon footprint will be key to effective green marketing. Figuring out how to do that while protecting competitive information will be the challenge.

Apple Trashes the Paper Receipt

photo: green wombat

When Green Wombat made a purchase at the San Francisco Apple store the other day, the salesperson asked if I'd prefer to have the receipt emailed to me rather than printed out. Brilliant. Imagine saving untold tons of paper used to print receipts that the vast majority of consumers probably just end up tossing in the trash (along with the paper or plastic bag that a clerk reflexively asked if they wanted). In an age when just about everyone and their cat has an email address, and when many purchases are made with debit or credit cards, paper receipts increasingly are an anachronism in a global warming world. It would be revealing to calculate the environmental impact of ridding the planet of those little scraps of paper - in terms of greenhouse gas emissions eliminated, toxic chemicals avoided and forests preserved. Not to mention the improvement to the corporate bottom line. The reality is that receipts, paper or electronic, aren't necessary for most daily purchases - already outlets like Starbucks or Peets will swipe your debit or credit card without printing proof of payment. And for the big buys an email receipt is way easier to find on your hard drive than a piece of paper stuck in some desk drawer. Apple (AAPL) spokesperson Steve Dowling tells Green Wombat that the e-receipt option has been available in the company's U.S. stores since late 2005 - when you make a credit card purchase - and is also offered in the U.K. (Though it hasn't been widely publicized, like other green Apple initiatives until recently.) Acceptance of e-receipts will obviously take some change in consumer behavior. But it's one of those small but significant moves toward sustainability that Wal-Mart (WMT), Dell (DELL) and other companies that have put themselves on the green path could adopt. Green Wombat is sold: by the time I made it from the Apple store counter to the street, my receipt had appeared on my mobile phone.