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Top 10 Reasons to Invest in Agriculture NOW by Anric Blatt

Top 10 Reasons to Invest in Agriculture NOW by Anric Blatt

http://www.globalfundexchange.com/blog/2013/05/17/top-10-reasons-to-invest-in-agriculture-now-by-anric-blatt/

Youtube link: http://youtu.be/H9MeQBIM4v0

by Anric

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Jeremy Grantham – The Race of our Lives

Jeremy Grantham – The Race of our Lives

http://www.globalfundexchange.com/blog/2013/04/29/jeremy-grantham-the-race-of-our-lives/

“Our global economy, reckless in its use of all resources and natural systems, shows many of the indicators of potential failure that brought down so many civilizations before ours. By sheer luck, though, ours has two features that might just save our bacon: declining fertility rates and progress in alternative energy. Our survival might well depend on doing everything we can to encourage their progress. Vested interests, though, defend the status quo effectively and the majority much prefers optimistic propaganda to uncomfortable truth and wishful thinking rather than tough action. It is likely to be a close race.
The collapse of civilizations is a gripping and resonant topic for many of us and one that has attracted many scholars over the years. They see many possible contributing factors to the collapse of previous civilizations, the evidence pieced together shard by shard from civilizations that often left few records. But some themes reoccur in the scholars’ work: geographic locations that had misfortune in the availability of useful animal and vegetable life, soil, water, and a source of energy; mismanagement in the overuse and depletion of resources, especially forests, soil, and water……

by Anric

 

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Jeremy Grantham on population growth, China and climate sceptics – Part 1

Jeremy Grantham on population growth, China and climate sceptics – Part 1

http://www.globalfundexchange.com/blog/2013/04/17/jeremy-grantham-on-population-growth-china-and-climate-sceptics-part-1/

‘The world’s most powerful environmentalist’ on battling the ‘misinformation machine’ and why China is his ‘secret weapon’

Jeremy Grantham, co-founder of GMO, speaks during the Ira Sohn Investmen Research Conference: Photograph: Daniel Acker/Getty Images
‘China knows this is serious’… environmental philanthropist Jeremy Grantham.

The following interview by Leo Hickman of the Guardian  with Jeremy Grantham, the environmental philanthropist and legendary fund manager, was published in the Guardian on Saturday.

Leo Hickman:  ”As I have done for my interviews with the likes of Al GoreBill McKibben and James Lovelock (in 2010 and 2012), I have taken the time to transcribe the full interview so readers can see what Grantham said in the kind of detail that the print edition of the Guardian can’t provide. The interview lasted three hours, so I have split the transcript in two. I will publish part two tomorrow, but here’s part one…”

Jeremy Grantham on why he has stepped up his environmental activities:

It’s data driven. We [the Grantham Foundation for the Protection of the Environment] were gracefully moving into the environment, save these animals and habitats, and all these good things, then the data on resources – starting about four years ago – made me realise that some of these were really urgent. That we were already entering a foodcrisis, for example. This time last year I thought it was clear from the data that we were already five years into a food crisis and it is highly unlikely to go away. And unless we get our act together it is likely to become a cascading problem.

On how much time we have to tackle the world’s environmental problems:

We’re already in a bad place. We’re on a sliding scale. The language “it’s too late” is very unsuitable for most environmental issues. It’s too late for the dodo and for people who’ve starved to death already, but it’s not too late to prevent an even bigger crisis. The sooner we act on the environment, the better. The sooner we cut off the carbon dioxide going into the air, etc. The worse accidents we will prevent from happening are 20, 30, 40 years from now. The same applies to food. The faster we act to improve the situation, the fewer Africans – North Africans, in particular – will come to grief. What is happening through the market mechanism is that the rich countries, by being unnecessarily sloppy – and by the Chinese getting richer in a real hurry and eating more meat – we are pricing up grain so that the poor are getting hungry. It’s hard to see this stopping in the immediate future. It’s also very hard to see the poor and hungry getting richer at the same speed as the way we are driving up the price of grain.

On feeding a growing human population:

There is a stretching disparity between the haves and have nots. It’s not the win-win of globalisation that we all grew up with studying in Econ 101. The irony is that as China gets richer, it burns more coal. They put pressure on the global environment and on global grain prices. So in order to give them a nice middle class, variegated diet, they could cause poorer Asians and Africans to starve. There is no mechanism to prevent that. Egypt runs a trade deficit. Their population is programmed to grow dramatically. Three million at the time of Napoleon. Eighty-three million, said their standard when they marched into the Olympic Games last year. And they’re on their way to 140m. They’ve always been very efficient, but they can’t feed much more than half their people. The price of grain from about 2002-2008 – a tiny window – tripled. Why did it grow so sharply? We knew population was growing, but it was growing steadily, if dramatically. When I was born there were two billion, now there are seven billion. It’s the kind of curve than anyone in finance would look at and jump nervously, when you see an exponential curve like that. That’s one factor, but nothing particular to the period of 2002-2008…

On the rising price of oil:

…2002 was a nothing year. The only numbers I was paying attention to in 2002 was for oil. A little wheel was turning at the back of my brain that noted that oil was beginning to act differently. Our firm specialises in the study of investment bubbles. We have the best data. Over the years, we have put together a database that has 330 bubbles of which about 40 are really important ones. What we found about the important bubbles is that every single one had burst completely back to the original trend. Three years up to something triple, and then three years down. They actually tend to go down a little more quickly than they went up, which is surprising. But they always broke. I used to specialise in asking financial audiences to give me an example of the paradigm shift, a major shift in a major financial asset class. And never was one offered. Six years ago I wrote about the paradigm shift in the New York Times. It had 100 years of oil prices – very volatile, but a very central, steady trend line of about 16 dollars a barrel in today’s currency. But then around OPEC in 1972/3, the price trend leaps up to $36.

On the unwillingness to process unpleasant data:

I find the parallels between how some investors refuse to recognise the trends and our reaction to some of our environmental challenges very powerful. There is an unwillingness to process unpleasant data. In a bull market you want to believe good news. You don’t want to hear that the market is going to go off a cliff. You don’t want to listen to the climate people who are telling you it is getting worse and even worse unless you do this and that. You want to listen to the good news. There were always people willing to tell you that smoking was OK and that stuff about cancer was exaggerated. There’s a professor at MIT who defended tobacco who now defends carbon dioxide saying it seems to have lost its greenhouse effect, or whatever. And then there are the vested interests. They are the single most powerful force because you are dealing with an audience who wants to hear good news and into the stock market come all the bullish stock market giant firms telling you everything’s fine because they love bull markets because they make a fortune. They don’t even mind crashes because they don’t do so badly there either. What they would die at is if the market went up at its long-term trend line at 1.8%, plus inflation, a year. But we’re not going back to 2% growth. Maybe we’ll do 1% and it will be reported as 1.5% and once again people don’t want to hear that. They want to hear Ben Bernanke‘s news that it should return to 3%…
Me calling bubbles correctly is all data driven and based on the optimism that is built into humans. Every time we see a bubble, we see an army of people screaming, “No, no, it’s not a bubble, everything is fine.” We see the climate and scores of people screaming the same that everything is fine, or that it’s a plot. It’s par for the course. The general public don’t want to hear it and will choose to listen to the optimistic interpretation. It’s a real uphill struggle. You don’t stop the bubble really until the damage is done. It goes so high that it can’t sustain itself and just pops. And maybe that will happen here and our job is to try to do a better job than we did in the tech bubble.

On climate sceptics:

The misinformation machine is brilliant. As a propagandist myself [he has previously described himself as GMO’s “chief of propaganda” in reference to his official title of “chief investment strategist”], I have nothing but admiration for their propaganda. [Laughs.] But the difference is that we have the facts behind our propaganda. They’re in the “screaming loudly” rather than the “fact based” part of the exercise, because they don’t have the facts. They are masters at manufacturing doubt. What I have noticed on the blogs and in the comments section under articles is that over several years, as the scientific evidence for climate change gets stronger, the tone of the sceptics is getting shriller and more vicious and nastier all the time. The equivalent on the other side is a weary resignation, sorrow and frustration and amazement that people on the other side can’t look at the facts. The sceptics are getting angrier and more vicious every year despite the more storms we have, and the more mad crazy weather we have…
One of the problems is that typically you are not dealing with the facts. Putting in more facts makes the sceptics more angry. They have profound beliefs – as opposed to knowledge – that they are willing to protect by all manner of psychological tricks. So you have people who are very smart – even great analysts and hedge fund managers – who on paper know that their argument is wrong, but who promote it fiercely because they are libertarians. Libertarians believe that any government interference is bad. Anyone with a brain knows that climate change needs governmental leadership and they can smell this is bad news for their philosophy. Their ideology is so strongly held that remarkably it’s overcoming the facts. They are using incredible ingenuity to steer their way around facts that they do not choose to accept philosophically. Laying down more facts just makes them more angry. You may win over a few neutrals. They are the people you can win over. But it’s very hard to win over the hardcore sceptics, of which there are plenty.
We can try to bypass them on one level and we try to contest the political power of the sceptics. They are using money as well as propaganda to influence the politicians, particularly in America. It almost doesn’t even exist in countries outside the US, UK and Australia. A cynic would say that the petrol-chemical industry also happens to be Anglo-Saxon. Where are the great oil companies based? They still have great power. The oil companies seem to have pulled back from directly supporting climate sceptics over the past few years because – in England, in particular – they were embarrassed and it became untenable to be so obvious. But they’re still influential. You don’t have go via back-channels any more, courtesy of the US Supreme Court, because it is completely legal for a corporation to invest tons of money in advertising programmes to say who is good and who is bad in a race for the Senate without even asking permission from the people who actually own the company. Corporations are treated as human beings and money is treated as having the right to speak. There’s dark money and light money. The anonymity they adopt is legal. They don’t have to say who their donors are. It is quite remarkable. And then you get the Something Something for the Environment, which are actually just sceptics funded by the bad guys. And then there are the thinktanks who have become propaganda-tanks. I used to respect the Cato Institute when it came out with reports on this, that and the other, and they have received a lot of hydrocarbon funding. But when the University of East Anglia break-in was engineered they had something like 20 press conferences the following month. The response to the break-in was almost immediate and co-ordinated. I don’t think it was suspiciously rapid, but I do think it was unusually and unexpectedly rapid. It’s very likely that it was simply a terrific response of their behalf. They moved very fast. The good guys are learning slowly, but surely, to step up their response time…
If you’re saying something that people don’t want to hear or accept, a significant proportion of them will reply with hostility. Not because they know the facts, or because they have researched it themselves, but because they’re so psychologically involved in believing good news that they will oppose it with a reflex. In addition, if the solutions proposed sound like they involve the government, you will have all the political rightwing try to block it as a reflex, even if it means them overriding hard science, which is what’s going on today. Changing people’s minds is almost impossible, even among scientists. Max Planck said, to paraphrase, that science advances one funeral at a time. You could add that economics advances the same way. You have to wait to get rid of the people who have career investment in a topic before a new generation can see the light.

On the UK’s unseasonably cold spring in 2013, and recent icy winters:

The scientists are getting very concerned privately – they are conservative in public and have yet to write it up – that blocking processes are sticking in the system. The jet stream is behaving very strangely. One very senior atmospheric scientist said to me recently off the record that we are liable to wake up one day and find ourselves on the latitude – which we are in the UK – of Montreal. It’s a liveable place, but not like London. They have underground tunnels because of their winters. The Gulf Stream is having a few wobbles, too, and the theory there is the melting in Greenland and the Arctic is creating a lot of cold, fresh water, which is a possible source for loss of power in the conductor, so it moves less warm water up from the Caribbean.

On how he chooses where to spend his foundation’s money:

We don’t fund the hard science of solar technology. That would take hundreds of millions. But what we are funding is bringing together the data and put it together and representing it conveniently to the outside world. And we want to train people with a good range of skills so they can produce good PhDs for the future at LSE and Imperial. We also fund old-fashioned style investigative journalism which is dying out in newspapers because the newspaper industry has become incredibly tough. The first people to get fired were the environmental journalists. We had a prize for environmental journalism which we brought in at the top of the market, but we discontinued it last year because there was basically no leverage left for the two-and-a-half environmental journalists left. All we were interested in was the net result of whether it could produce a more effective presentation of the facts. We got going in the nick of time to see that it could drag up environmental journalism, but then all the “dragees” were suddenly looking for different jobs, or put on different beats. Or that they were already working for the handful of independent investigative organisations. We fund about a dozen fledgling journalistic projects. Our argument was they are all fledgling so let’s fund them all first, then winnow them down later – come back in 3-4 years and pick eight and, a couple of years later, pick five. In the end, it doesn’t matter if there are one or two, but that they are the best. They whole point really is to allow these people to do their thing and to play to their skills and to pick the people who are highly motivated and very skilled. None of them would be very happy if we tried to tell them what precisely to do and we don’t know what they should do.

On assessing if the money his foundation spends has achieved its objectives:

It’s a great problem for philanthropists and NGOs. The problems where you can measure the impact are not common in the environmental field. If you can measure them, they tend to be over decades. One is the wildlife population of Namibia. That is by far and away the most successful [conservation project the foundation has funded], by the way. You can see the population of the various types of antelope have improved. But that is unusual. But the ones you feel are most important are the vaguest of them all. How do measure the shift in attitudes towards processing the data? There are guys working on studying the changes in attitudes in the media. But you have to take a leap of faith that they are smart and dedicated.

On whether he tries to persuade other philanthropists to support his causes:

No, I don’t. We might discuss such things informally over lunch. There’s a handful of hedge fund managers, mainly, who have decided to be aggressive about the environment, thank heavens. This doesn’t exist in England where you could get them all on the finger of one hand. I can try to persuade them. I gave a talk in London recently at the head office of a major financial player and someone went to considerably effort to make sure a couple of hundred potential philanthropists and wealthy individuals were there for me to have a go at them. A lot of them left their business cards and if you do that you are kind of asking for trouble. [Laughs.] I believe the majority left their cards, which as things go, is a huge potential hit because even if you get one or two that could be significant. They were a receptive audience. I try to paint the picture of how I got to where I am [as an investor] and then of how fact based the issues appear to be to me. I now try to add my thoughts about food and the “carbon math”…

On the “carbon math”:

…It’s simple, comprehensible maths, as Bill McKibbenexplained in Rolling Stone last year. There are five times the amount of proven carbon reserves as we can possibly allow to be burned if we want to remain under 2C of warming, which is now not even considered to be a safe margin. We must burn just a fifth of what’s there. We will burn all the cheap, high-quality oil and gas, but if we mean to burn all the coal and any appreciable percentage of the tarsands, or even third derivative, energy-intensive oil and gas, with fracking for shale gas on the boundary, then we’re cooked, we’re done for. Terrible consequences that we will lay at the door of our grandchildren. Some things might change very quickly, though. For example, the business mathematics of alternative energy are changing much faster than the well-informed business man realises.

On the falling costs of alternative energy:

Read my next quarterly newsletter entitled, “The Race of Our Lives”, [will be available here] on why civilisations fall and why they’ve always fallen and why we may not because we have two advantages that they did not – a voluntary fall in fertility, which is just amazing, and alternative energy. Every wave of technology has seen an incremental increase in energy needed – steam engines, cars, air conditioning, iPads – they all add to our energy needs and mean we dig a deeper hole, but we feel we are making wonderful progress. But now we have a technology wave which protects us from needing to burn every last ton of coal. Solar, wind, biomass, intelligent grids, and storage – please, more storage – protect us. That is the best part of capitalism. The price of solar panels is now 25% of what it was two years ago and that’s the bit people have missed. If these prices were to be held – they may not be – we are competitive, without a carbon tax, in the areas that have the sun – California, North Africa, Spain, etc. You can build a solar farm and it can be commercial. Meanwhile, the price of hydrocarbons are getting more expensive all the time, because you’ve extracted all the easy stuff first and with China rising and still growing at 7% a year. And that’s just China. Don’t forget India which actually has more coal power plants down to be built on the books at the moment than China. Now you start to get an idea of, wow, why this does not compute. If it computes, it’s only at the enormous increase in cost of digging and shipping coal. Meanwhile, back at the ranch, solar and wind power are getting cheaper and cheaper. Those lines are going to cross big time in the next 20 years. There is no such thing as “locked in and committed” because you can reverse. They might build a few more coal-fired plants, but then they will stop completely. The pay-off for China of getting out of the way of those lines crossing is so great.

On why China is his big hope:

China is my secret weapon. I call them the Chinese cavalry riding to the rescue. They have the capital. They have an embarrassment of capital – 50% of their GDP is capital investment. We have a shortage of capital and also have debts. Their problem is how to invest all that capital. My partners worry all the time about them wasting their money. What better programme could they possibly have, with huge social pay-off, than a massive replacement of sustainable energy? When you think what it would mean to them – it would get rid of their pollution – it makes sense. Because of that pollution, they announced recently an incredible increase of 65% in their plans to install by 2015 – just three short years away – 36GW, which is equivalent to 20 vast, state-of-art coal plants, of solar. Throw in wind, too. And, by the way, we will have many breakthroughs in storage. If I had to make a bet, I would say that’s the most promising, important breakthrough of the next several years. Everyone is working on this. If you have a big smart grid – and all the desert of Xinjiang and all the wind of Inner Mongolia – and it’s all swirling around with relatively little loss and you have a grid smart enough to go in there Chinese-style and turn your fridge off for half an hour to save energy, and do this and do that, you don’t need nearly the back-up. The bad guys will tell you that you need 100% back-up and messianic environmentalists will tell you that you need 0%. But maybe 20% back-up will be needed as everyone is working on storage. I’m certain it will happen. Some technologies take time then go, “Bang!”. Look at video conferencing. It has been around forever and the quality was terrible. But now it is so clear and instant. Technology has a habit of boring you to death and disappointing you for 20 years then suddenly it delivers a new world…
I have very high hopes for China because they have embedded high scientific capabilities in their leadership class. And that is huge. They know this is serious. They can calculate the social threat of getting this pollution, weather instability, water out of control. And they are acting much faster now than we are. They have it within their capabilities of coming back in 30 years with the guarantee of complete energy independence – all alternative and sustainable forever. They have an embarrassment of capital. We have an embarrassment of debt. So they can set a stunning pace, which they are doing. And they could crank it up. To hell with their five-year plans, they should move up to 25-year plans for alternative energy – energy security, reducing pollution and low cost. They would have such low-cost energy at the end of it they will be the terror of the capitalist system. With low energy and low labour, that’s the ball game. Five years into a 25-year programme and any capitalist will be urging their government to copy them.

On the Scandinavian countries:

I am inspired by [them]. They have to cope with short-term election cycles and a parliamentary system and all four of them nevertheless act responsibly, not just on alternative energy and environmental issues, but also on social issues that matter. They are, by and large, models of good behaviour. They say in America to me what’s the solution to all this, I say cede your government to Denmark. [Laughs]. They are good enough that they would get the job done.

On environmentalism’s track record of making predictions:

Go and read Limits to Growth, which I did recently. They pretty much predicted doom and gloom 20 years from now. They have been grossly misinterpreted and are pretty much on schedule. There are details that are over and under, but it is amazingly accurate. The William Ophuls model is that we are hard-wired to collapse. Given half a chance we will over-reach. We are over-confident that we will solve every problem. But we will leave it too late and we will crash. All the confidence that people try to give you – the “infinite capacity of the human brain”, unquote – all of that hinges on the apparent infinite supply of hydrocarbons. No civilisation looked durable and resilient until coal and then we acquired this amazing power. We are now coming to the end of that era. If we don’t use that window to fix it and have a sustainable replacement, we are toast. Don’t worry about peak oil, worry about peak temperature. All our flora and fauna has thrived in the last 10,000 years since the end of the last ice age, a period which has seen unbelievable stable weather by long-term standards. Now it is becoming unstable. If you drive the temperature above 40C, well-known brands of corn will not produce. They just stop. You might be able to twist and turn and get it to produce at 41C, and you might move further north in latitude, but temperatures rises are very bad news for grain. The wider point is it [temperature rise] is generally bad for everything that evolved in one stable environment. It has no resilience to produce outside the temperatures experiences during this 10,000 year period. Quite a few grains are now topping out in terms of productivity. I look around and I say just look at the food-producing problems we face. In fact, let’s make it even simpler: look at the grain-producing problems we face around the world. We’ve just had three consecutive monster-bad grain harvests. Not one of those three poor harvests was more likely than a one-in-25-year harvest. But the terrible thing is they went, “whack, whack, whack”. I took some grief when I wrote about the first one and said next year was bound to be less bad, but the next year became a monster. I’ve done more research and reading in the last two years than I ever did at college. I’ve read all the classics. All the limits to growth, all the end of civilisations stuff, all the peak everything stuff, all the soil destruction stuff.

On confronting our environmental problems:

Asking, “Are we too late?”, is not the logic for this problem. It is too late for the dodo. It is too late for the one third of arable land that we have destroyed in 10,000 years. It’s too late for 10% of global biodiversity, and almost certainly another 10%, and 50/50 for yet another 10% after that. But it would be nice to end up with a planet that we can still relate to, that still has a fairly handsome biodiversity. We can still do that. There is one chance that the real pessimists are right. The chance that on our way to a 4-8C rise, and a 10-15ft rise in the oceans, which is probably what’s going to happen over the next two centuries, that things will get worse before they get better, because there is inertia built into the system. You can easily imagine resource wars breaking out unless we put our best foot forward on alternative energy. This would buy us time for everything else to be solved. If you can become energy sustainable in the next 40 years and suck up the pain that will have been paid by then, then you have probably bought the time for another 40 years to transfer the whole of global agriculture into a fully sustainable system before we run out of the resources to run old-fashioned agriculture. And if you do that then, in turn, you have probably bought enough time to deal with the intractable long-term issue of metals, which are entropy writ large. No matter how careful you are with them, they slip through your fingers. In the end, you will need to use organic replacements, which will take a long, long time [to develop]. We’d better start working on it now, but not too many are and they’re not getting much funding. You’ve got to get the population down and you’ve got to ignore the Economist magazine and others talking about rising population as a terrible economic problem. It is a necessary, short-term, intermediate pain to pay for the absolute minimum hope of survival, which is a gracefully declining population, because if you don’t do that you will have a rapidly imploding population one day.

Continue to PART 2

by Anric

 

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Anric Blatt to speak at upcoming Global AgInvesting conference

Anric Blatt to speak at upcoming Global AgInvesting conference

http://www.globalfundexchange.com/blog/2013/04/08/anric-blatt-to-speak-at-upcoming-global-aginvesting-conference/

Global AgInvesting 2013

New York Apr 29, 2013 – May 02, 2013

Global AgInvesting is the world’s most well attended agriculture investment event.

Global Fund Exchange Group Chairman and Portfolio Manager, Anric Blatt will be moderating the following panel at the 2013 Global AgInvesting conference at the Waldorf Astoria Hotel in New York.

Liquid Ag Strategies

Wednesday, May 1: Main Conference Day 2 from 2:30-3:30 

Moderator: Anric Blatt, Chairman, Global Fund Exchange Group

In today’s unpredictable economy, many investors look to increase their exposure to agriculture while maintaining a certain level of liquidity. Publicly-listed ag equities, commodity future index funds, ag focused hedge funds and ag lending strategies provide investors with a more traditional exposure to the ag theme. Liquid investment in ag requires the same focus and specialization as illiquid investment strategies. Hear from leading managers about the opportunities in this segment of the market.

  • What are the different liquid strategies available to investors?
  • How do these strategies relate to the illiquid portfolio – in particular farmland?
  • What are the right questions for investors to ask when pursuing a liquid ag investment strategy?

Click here to see the agenda online or click here to download the conference brochure as PDF

ABOUT THE GLOBAL AGINVESTING 2013 CONFERENCE: Now in its fifth year, Global AgInvesting 2013 offers a comprehensive overview of agriculture investment opportunities, risks and return profiles across all major global production regions, as well as strategies for diversified ag portfolios including regional variation, private equity, and liquid investments. Concurrent track sessions will highlight the surrounding themes of ag venture capital and agricultural technology, water opportunities, and protein plays in livestock and dairy, global fisheries and aquaculture. http://www.globalaginvesting.com

ABOUT THE GLOBAL FUND EXCHANGE GROUP: Established in 2005, the group focuses on providing institutional investors with professionally managed impact investment portfolios in the vital asset classes of ENERGY, WATER, FOOD and SCARCE NATURAL RESOURCES. As a multi-manager specialist, the group provides its visionary clients with liquid, transparent and low volatility access to some of the most advanced thinking and sought after investment talent in this rapidly growing sector that can no longer be ignored.  http://www.globalfundexchange.com

ABOUT ANRIC BLATT: As founder and chairman of the Global Fund Exchange Group, Anric Blatt sits at the intersection of capital markets and vital assets. An experienced hedge fund specialist with 20 years experience in financial markets, Mr Blatt has dedicated his entire focus towards providing profitable and cutting edge financial solutions towards some of planet earth’s greatest obstacles (and opportunities). Click here to read his bio, or visit his blog posts or connect with him on linkedin.

by Anric

 

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Where’s the Water of the Future

Where’s the Water of the Future

http://www.globalfundexchange.com/blog/2013/03/21/wheres-the-water-of-the-future/

Today is world water day. Fresh water. The planet has only so much to meet the needs of a growing world population. And global warming throws more uncertainty into the mix by increasing chances of extreme weather, such as more intense droughts in some places.
Dry spells, such as the devastating drought that gripped much of the United States last year, come with economic costs in the developed world and deadly consequences in poorer countries.
There is no secret source of water of the future.
Conservation is the best answer, agreed panelists at a discussion held Thursday, Feb. 28, at the New York Academy of Sciences.

‘You can’t build your way out of the problem. We aren’t making any new water.’
– Brian Richter, director of global freshwater strategies for The Nature Conservancy

Better than building
Using the available water is much cheaper than building more reservoirs, pipelines, desalinization plants (to remove salt from seawater) and other infrastructure, said panelist Brian Richter, director of global freshwater strategies for The Nature Conservancy. [Dry and Drying: Images of Drought]
“‘I related it to my personal banking account,’” Richter said, quoting a friend. “‘If I am overdrafting my personal bank account it is going to do me no good to open up another account.’ You can’t build your way out of the problem. We are not making any new water.”
The good news is, he said, “We’re wasting so much, so there is a lot of potential to do a whole lot better.”

Curbing demand
History shows that conservation is realistic, said panelist Peter Gleick, co-founder of the nonprofit Pacific Institute.
Between 1900 and 2005, the U.S. gross domestic product (goods and services produced by the economy) grew rapidly. Water use paralleled this growth until 1980, then it leveled off.
“The assumption that our demand for water has to go up with population and economy is a false assumption,” Gleick said.
In reality, it is unlikely the United States could have found the water it needed if water withdrawals had continued to grow, he said.
A number of factors tamped down demand for water over the past three decades, he said. Irrigation systems have become more efficient, losing less water to evaporation; Americans are eating less beef, which requires water to raise; toilets, washing machines and industrial processes require less water; Americans are reusing treated wastewater, although “we don’t do it much and could do it more,” Gleick said.
In fact, wastewater treatment infrastructure could be distributed within particular areas, rather than centralized in a single plant, allowing water to be recycled within those areas. Wastewater would be treated, redistributed to users, then returned for treatment, reducing the substantial costs associated with pumping water across long distances, noted Upmanu Lall of Columbia University’s The Earth Institute.

At its source
New York City itself offers an example of good planning, said Adam Freed, director of the Nature Conservancy’s Global Security Water Program, who said that cities are often focal points for the global water crisis. [Earth in the Balance: 7 Crucial Tipping Points]
About 2,000 square miles of watershed (land that drains into a particular waterway) has been set aside in the Catskill Mountains and the Hudson River Valley to supply the city with clean water. By investing in protecting the watershed from pollution, the city has saved itself the much larger costs associated with treating the water it needs, Freed said.
This strategy of protecting the water at its source needs to be replicated elsewhere, he said.

Water and money
The private sector has an important role to play, said Brooke Barton, who leads the water program of Ceres, an organization that advocates for sustainable leadership in business.
A number of large companies, such as Coca-Cola and Ford, have recently made commitments to address water use. But the private sector still has far to go, she said. In a study conducted last year, Ceres researchers found that many large companies were far behind the curve with regard to water conservation, Barton said.
The investment community is likely to play an important role in change by pushing companies to gather more data about risks associated with water use, she said.
The cost of water use is often hidden, changing water’s price could affect usage, just as gas consumption changes with price, Richter pointed out, with a caveat: “We do have to be careful not to raise the price out of the [range of] affordability of the poor.”

Future climate
Warming brought by climate change is expected to intensify the water cycle — the processes by which water travels between the oceans, land and atmosphere — by increasing evaporation. This is expected to cause changes in extreme weather, including more heat waves and heavy downpours, as well as intense droughts in some, not necessarily the same, places.
These changes will affect water resources, Gleick said.
“Our water systems were designed for yesterday’s climate, and managed for yesterday’s climate,” he said.
Although current changes are the result of human activity, climate change itself isn’t a new phenomenon. Lall said that in the past, nature has shown great variability, at least as large as anything projected for the future. Knowledge of this history can provide a place to start with regard to adaptation, he said.

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by Anric

 

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Giant 100MW Shams solar thermal plant comes online in Abu Dhabi

Giant 100MW Shams solar thermal plant comes online in Abu Dhabi

http://www.globalfundexchange.com/blog/2013/03/18/giant-100mw-shams-solar-thermal-plant-comes-online-in-abu-dhabi/

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Abu Dhabi’s Masdar project has officially inaugurated the world’s largest solar thermal power project, after yesterday bringing online the 100MW Shams 1 concentrated solar power (CSP) plant.
The $600m project, which was developed in partnership with oil giant Total and Spanish energy developer and solar specialist Abengoa, is now expected to displace approximately 175,000 tonnes of CO2 a year and act as a forerunner for further CSP projects in the United Arab Emirates (UAE).

“The inauguration of Shams 1 is a major breakthrough for renewable energy in the Middle East,” said Dr. Sultan Ahmed Al Jaber, chief executive of Masdar in a statement. “Just like the rest of the word, the region is faced with meeting its rising demand for energy, while also working to reduce its carbon footprint. Shams 1 is a significant milestone, as large-scale renewable energy is proving it can deliver electricity that is sustainable, affordable and secure.”

The facility, which covers an area equivalent to 285 football fields in western Abu Dhabi, makes use of parabolic trough technology, featuring more than 258,000 mirrors mounted on 768 tracking solar collectors. The troughs concentrate the heat onto oil oil-filled pipes, which are then used to produce steam that drives a turbine to generate electricity.

Masdar said the project also features a dry-cooling system that significantly reduces water consumption, described as “a critical advantage in the arid desert of western Abu Dhabi”.
“This is a major step in the process of transforming the capabilities of solar power in the region,” said Christophe de Margerie, chairman and CEO of Total, in a statement. “We share Abu Dhabi’s vision that renewables have a promising future alongside fossil energies… As such, we are pleased to accompany the Emirate in the diversification of its energy mix.”

The official opening of the new project represents the latest in a series of milestones for the high profile Masdar project, which has committed to establishing Abu Dhabi as a major global renewable energy hub and investor, featuring the world’s first zero carbon city, new renewables-powered desalination infrastructure, and stakes in large scale renewable energy projects around the world.

by Anric

 

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Energy Outlook – A view to 2040

Energy Outlook – A view to 2040

http://www.globalfundexchange.com/blog/2013/03/04/energy-outlook-a-view-to-2040/

Walking through the lobby at the Four Seasons Hotel in Doha, Qatar, we stumble across a live presentation by ExxonMobil of its annual Energy Outlook. Normally every year we like to present the key findings of this excellent industry source to our clients and partners.

The Outlook for Energy is ExxonMobil’s long-term view of our shared energy future. They develop the Outlook annually to assess future trends in energy supply, demand and technology to help guide the long-term investments.

This year’s Outlook reveals a number of key findings about how we use energy, how much we will need in the future and what types of fuels will meet demand.

For example:

Efficiency will continue to play a key role in solving our energy challenges. Energy-saving practices and technologies, such as hybrid vehicles and high-efficiency natural gas power plants, will help countries in the Organization for Economic Cooperation and Development (OECD) – including those in North America and Europe – keep energy use essentially flat even as OECD economic output grows 80 percent.

Energy demand in developing nations (Non OECD) will rise 65 percent by 2040 compared to 2010, reflecting growing prosperity and expanding economies. Overall, global energy demand will grow 35 percent, even with significant efficiency gains, as the world’s population expands from about 7 billion people today to nearly 9 billion people by 2040, led by growth in Africa and India.

With this growth comes a greater demand for electricity. Today, and over the next few decades, electricity generation represents the largest driver of demand for energy. Through 2040, it will account for more than half of the increase in global energy demand.

Growth in transportation sector demand will be led by expanding commercial activity as our economies grow. However, energy consumed by personal vehicles will gradually peak and then begin to fall as our cars, sports utility vehicles (SUVs) and small pickup trucks become much more fuel-efficient.

Technology is enabling the safe development of once hard-to-produce energy resources, significantly expanding available supplies to meet the world’s changing energy needs.

Oil will remain the No. 1 global fuel, while natural gas will overtake coal for the No. 2 spot. Use of nuclear power and renewable energy will grow, while demand for coal peaks and then begins a gradual decline.

Evolving demand and supply patterns will open the door for increased global trade opportunities.

Around 2030, the nations of North America will likely transition from a net importer to a net exporter of oil and oil-based products. The changing energy landscape and the resulting trade opportunities it affords will continue to provide consumers with more choices, more value, more wealth and more good jobs (see page 44).

The Outlook provides a window to the future, a view that we use to help guide our own strategies and investments. Over the next five years, ExxonMobil expects to invest approximately $185 billion in energy projects alone. Given the magnitude of these investments, it’s critical that we take an objective and data-driven approach to ensure that we have the most accurate picture of energy trends.

The information contained in the Outlook regarding energy markets is also crucial for individuals, businesses and policymakers. We hope that by sharing this Outlook, we can enhance understanding of energy issues so that we can all make informed decisions about our energy future.

Download the entire report: Energy Outlook – A view to 2040

by Anric

 

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