On being an industry analyst and the Climate Change Industry… or the Decarbonization Industry… or the Regeneration Industry.
As an industry analyst, market forecaster or futurist it can be very useful to go back to your roots. As publisher and editor of Environmental Business Journal since 1988, I have had ample opportunity to reflect on past avenues of research and the branches of business I have pursued in my career.
One of the early offshoots was a sister business that defined and tracked the nutrition and natural products industry called Nutrition Business Journal. The analytical model developed for NBJ bore many similarities to the model I had already applied to the environmental industry, and later to the climate change industry. Branching out into a new industry inevitably widened my circle of colleagues–and my thinking.
Returning to a nutrition industry conference this summer that I co-founded with colleagues in 1999, I was lucky enough to enjoy several stimulating and intriguing conversations with activist and entrepreneur Paul Hawken. Paul is well known as the author of the Ecology of Commerce, a best seller that revolutionized thinking about the relationship between business and the environment. Like me, Paul has had a foot in both environmental and natural products camps over the years, with the roots of his business empire reaching back to natural products and the Smith & Hawken catalog brand, but his commercial and intellectual thinking advancing more recently in the environmental and climate change fields.
Today Paul is an advocate of “regeneration” to reverse the impacts of climate change. And it got me to thinking, could the regeneration business be a definable segment of the Climate Change Industry? My discussions with Paul and others that joined the conversations confirmed my belief that perhaps regeneration could be one of the biggest economic opportunities of our times.
Paul Hawken would use different words, and he’s published Drawdown a new book on the subject, but here is my definition of regeneration and why it is such an important and enormous opportunity.
As a species we have spent the last several centuries scraping away at the Earth and accelerating agricultural, extraction, development and energy generation processes which effectively have transferred carbon atoms from the ground to the atmosphere. This has admittedly made life more comfortable and adventure more available to mankind, and lots of people have made lots of money.
But unsustainability has caught up with us. The rest of this century will be about reversing the carbon imbalance between the atmosphere and the Earth’s surface. We must make investments to regenerate the carbon positive impact of our terrestrial assets acre by acre. This is where regeneration and the Regeneration Industry comes in.
Each acre or defined unit of land can be measured for its carbon contribution to the overall carbon balance. I believe we will soon be measuring land stewardship based on how much carbon is fixated in each acre. Any negative impact on that carbon contribution will have to be restored elsewhere. A similar process in wetlands mitigation is familiar to many in the environmental industry where any new development in a wetland environment requires permanent preservation or restoration of equal or more wetland in the same watershed.
But restoring the carbon balance requires a much more proactive approach than just preservation and protection. The extent to which every acre has been regenerated or restored to its carbon fixation potential compared to its degraded state as a carbon emitter can be measured and monetized. And, importantly, this contribution can be measured in monetized on a regular basis so income streams can be continuous rather than a one-time deal as most restoration projects have been.
Current carbon emissions credits and trading schemes pioneered at scale in Europe and now instituted in many countries around the world including California and China may be making a dent in global emissions, but hardly address the Earth’s carbon-balance equation. Accelerated emissions reduction, combined with accelerated investments in regenerating the carbon positive contributions of the land and ocean, is required to tip back the imbalance in the global carbon cycle.
So while regeneration is not the only solution to climate change, it should receive as much attention and investment as emissions reductions in the form of Renewable Energy, Energy Storage, Carbon Sequestration, Energy Efficiency, Green Buildings, and other segments of CCBJ’s already defined climate change industry.
So how does one create this regeneration industry? How does one create an investable proposition in fixating carbon on land-based assets? And how does one assign credit to the broader concepts of conservation and preservation, compared to restoration and regeneration?
It may seem impractical to assign credit based on preservation of an acre of land against what might otherwise have happened to that acre of land, but surely there is rewardable value in preserving the carbon contribution of that acre.
And how does this play out in the international community? How does one reform land use policies in countries like Brazil and Indonesia that have had some of the worst records in terms of eviscerating the carbon contribution value of their natural assets.
First, the investors that finance the regeneration of each asset could be the recipients of the economic value of the carbon contribution of those assets that are restored. Investors are motivated by secure returns. Predictable value for regulated and voluntary carbon credits are increasingly secure. Established policy around a minimum value for ton of carbon is not far off. And thanks to technology and its maturing ability to measure both carbon emissions and regenerative contributions, the process to track these can be automated and verified.
Preservation and conservation could be monetized by international bodies and their NGO partners who would oversee this process, with some reward and incentive for national and local governments to assure their cooperation.
These are the frontiers of public policy where consensus is required if the Regeneration Industry is to take hold as a viable business proposition and investable sector of the economy.
So, like the rest of you out there, I have to admit that I am part of the problem as a consumer in contemporary society, but lets re-commit to being part of the solution in our professional and personal lives. Our collective efforts to advance regeneration in any form is an important step in the right direction.
At Climate Change Business Journal we devoted a fair amount of effort to the concept of natural infrastructure, which in part embodies the carbon contribution of ecosystems around the world.
For further reading please request a copy of CCBJ’s summary, analysis and economic valuation of Natural Infrastructure, and I will send a PDF file and welcome your comments.
Editor, Environmental Business Journal
Editor, Climate Change Business Journal
President, Environmental Business International, Inc.
Chairman, Environmental Industry Summit