Wednesday, April 1, 2020

Keeping It Green

By Nayantara Bhat “The Earth is in trouble,” announces the first sentence of Michael Lenox and Aaron Chatterji’s new book, Can Business Save the Earth?: Innovating Our Way to Sustainability. Lenox describes the potential of startups to affect global change during a presentation at Asia Society Hong Kong on May 9, saying that current rates of innovation will not suffice.
“We’re not going to achieve [emissions targets] without huge disruptive innovation,” Lenox says, adding that creating the right ecosystem for incubating CleanTech startups is an ‘under-appreciated’ policy option.

This is mostly because funding innovation to the point where it’s able to scale involves redirecting money from ‘old’ industries to incubators and accelerators. Lenox uses the 2009 bailout of General Motors as an example, saying that the US$49.5 billion could have been put into CleanTech startups, but at the cost of thousands of jobs.

Much of the world’s industrial processes are outsourced to Asian countries. When asked whether this would drive or slow down the rate of innovation, Lenox says it could go either way. Older and more established industries have a history of “defending their turf”, he says, and overturning the status quo to be able to progress is likely to be a long process.

Lenox also points out the rate of innovation in different types of clean energy across the globe. His findings show that the highest number of patents in solar energy are registered in Japan and South Korea. 

These countries are well-positioned to produce solar cells – which are similar in structure to micro-electronics – because of their large-scale semiconductor industries. While he doesn’t mention the rate of adoption of these technologies, it’s a positive sign that Asia is taking part in the global push to lower emissions.

Lenox also describes the role that existing industry players should take up: providing innovative startups with the means to scale. California-based AgTech firm Blue River Technology is one example. Blue River provides machine-learning technology that can be used to cut the usage of water and pesticides.

According to Lenox, the development of Blue River’s technology was funded initially by friends, family and angel investors before big players like Khosla Ventures and Monsanto Growth Ventures chipped in. It was acquired last year by agricultural equipment firm Deere and Company for US$305 million, allowing the startup access to considerably more resources than it had before.

Two of the major environmental issues Lenox and Chatterji identify in the book are the lack of potable water and the rise of greenhouse gas emissions that contribute to global warming. Two startups in Asia, amongs others, are trying to remedy these problems.

Singapore-based EcoWorth Tech has developed a type of Carbon Fibre Aerogel (CFA) that can filter and absorb toxins from factory waste water. The Aerogel is made from waste paper and can be reused and recycled. The processed water is safe for release into waterways.

A recent report by Aljazeera’s 101 East program showed alarming levels of neurotoxins and other chemicals are being released into the Indonesian river Citarum, putting thousands of local people at risk of dangerous diseases. Levels of lead in the water are 100 times higher than the ‘safe’ level indicated by experts. Situations like this exist across Asia, but EcoWorth’s technology could help to make the water usable again.

Inc reported last month that EcoWorth has successfully raised seed funding and is trialing its CFA with two industry partners. Crunchbase data shows that EcoWorth has raised a total of S$1 million in seed funding.

Meanwhile, Philippines-based startup HiGi Energy is trying to replace coal – an essential in Filipino culture where barbeque is incredibly popular. HiGi repurposes water hyacinth into combustible briquettes that it hopes will replace coal.

The water hyacinth is an aquatic plant that is largely described as a weed – it spreads quickly across the surface of bodies of water, blocking the sunlight below the surface and preventing underwater plants from photosynthesizing.

HiGi’s technology turns this invasive species into a useful resource. The briquettes don’t produce the carbon dioxide-heavy smoke that comes from coal combustion, and one brick lasts for 45 minutes.

Lenox’s comments about the struggle of scaling enough to make an impact are fiercely relevant in both cases. These startups have the potential to alleviate major pollution crises in Asia, but only time will tell whether investors and giants in textile and fuel will be willing to support these ventures.

In the past, CleanTech startups weren’t good options for venture capitalists because they scaled so slowly. Lenox says that times are changing and the rise in awareness about global warming paired with the advent of impact investing are contributing to a shift in what kinds of companies are getting funded.

“There’s a broader movement of those who are looking for other metrics of success,” he says.

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