Green Technology: Froth or Foundation?

Much ink has been devoted to celebrating the promise of “green technology” as an environmentally responsible and fiscally sound alternative to older “dirty” technology. But do these technologies, at their current price points, actually make current economic sense for business and industry? The answer is a definite “yes” if you are in the business of selling technology that you can brand as “green,” but a cautious “maybe” if you are looking for “green” to meet the bottom line needs of your business.

The issue of what makes a technology “green” is still very much up for debate. Even if we define green technology in simple terms, as a technology that offers a more environmentally friendly solution compared to an existing technology, we are still left with the problem of assessing the real environmental costs of the two competing technologies. The move to fossil fuels was clearly a major factor in stopping the deforestation of Europe and North America. Does that make coal a green fuel? Are electric vehicles “green” because they do not generate any air pollution where they operate? Or are they “dirty” because the fuel that must be burned to create the electricity to run one for a year (using current technology) creates more pollution than a modern internal combustion car engine does in that same year?

While scientists, philosophers, and ethicists work on the puzzle of the real costs of going green, the appeal of the green promise has intrigued national and regional governments around the globe. First world countries have made long-term investment commitments to create economic opportunities by directly funding the research and development of green technologies and by providing tax breaks to make the application of current green technologies financially palatable. Investments in green energy technology have also received a boost from the current instability in the world political climate. Even the unabashedly petroleum-friendly Bush Administration is paying lip-service to green technology, such as hydrogen fuel cells, as part of a long term solution to the problem of dependence on “foreign” oil.

For business, as well as governments, green technology must be viewed as a long-term commitment in order to be economically viable. The 1980s saw a boom in the development of alternative energy projects in California. These projects were fueled by tax preferences and high conventional energy costs. The revocation of the tax preferences, the availability of comparatively cheap energy, and the regional economic bust of the 1990s led to the near collapse of the alternative energy business. In 2003, solar is hot once again, as appealing tax incentives, high energy prices, and new technology drive a boom in solar products. But even under these favorable conditions, solar only makes sense if a business can afford to make the initial investment and wait the typical 3-6 years for the payback.

Companies and institutions with vision, a socially conscious operating philosophy and substantial resources are making investments for the long haul in the form of entirely green buildings or campuses. While choosing to build green may drive up initial construction costs by as much as an additional $50 per square foot, these companies and institutions have faith that paying the hefty green premium in the short term will provide immediate benefits as well as long-term savings.

For the Chicago Center for Green Technology, developed by the Department of the Environment of the City of Chicago, a state-of-the-art green building was developed on a city-owned environmentally degraded site. The Chicago Center project provided the Department of the Environment with an opportunity to support and showcase a green approach to restoring the site and to re-furbishing an existing building. In additional to serving as a promotional and educational tool for the Department, the campus provides a home for public and private entities that are committed to environmentally friendly technology.

The Center uses solar energy in several ways. Approximately 20% of the Center’s electrical power is generated by three photovoltaic arrays. Window and skylight placement maximize passive solar for lighting and heating. While the greenhouse on the campus uses traditional passive solar heat, (as do all greenhouses), the building is designed with a three-foot-thick filled rear wall that acts as a heat sync to radiate heat back into the greenhouse at night. The Center also uses a “smart lighting” system that saves energy by monitoring the natural light and adjusting the level of artificial light accordingly.

The design for the Center also addresses concerns about issues of urban run-off and responsible water use. The design includes a “green-roof” of water-absorbing plant materials, disconnecting downspouts from the municipal sewer system and directing the water into cisterns to supply landscaping water in dry months, while the winter overflow feeds into “bioswales” – ditches with plant materials that allow water to percolate back into the ground.

For The Chesapeake Bay Foundation, institutional credibility required that they tread lightly on the land as they designed and constructed a new headquarters building. The challenge was met by the Philip Merrill Environmental Center building, which is arguably the greenest building of its size in North America. In addition to energy efficient lighting, heating, and passive solar capture, the location of the Merrill Center campus allowed for the inclusion of a wetlands element that acts as a bio-filter for the building’s waste water. The building designers also placed importance on using materials with long useful life – to avoid the environmental damage inherent in the cycle of disposal and replacement. The environmental concern is even evident in the choice of cork as the flooring material – since cork-bark is harvested without killing the cork oak.

Because environmentalism has become a firmly entrenched value for most citizens of the first world, corporations and industries that have been associated with dirty technology have put a green face on their operations to silence critics and please shareholders. For some, the green awakening comes with an understanding that is it more cost effective to avoid polluting than to be held accountable for toxic waste clean up.

Sometimes through a commitment to real change, and sometimes through a real commitment to public relations, manufacturers of pesticides, mining concerns and oil companies are all eager to be seen as part of the latest green revolution.

Beyond the green PR spin from old fashion mega-polluters, the fact that green is once again in fashion presents real opportunities for companies that can position their consumer goods and services as green. Many people are looking for ways in which they can go green at home. These committed green consumers have significant amounts of disposable income and are willing to pay hefty premiums for product they believe will protect the health of their family and the health of the planet. Like the cash-flush socially conscious businesses for whom many in this class work, the wealthiest of green families are willing to pay a premium to incorporate green energy technology into their homes and to build dwellings with newly developed green materials, such as the light concrete called “Syndecrete,” that have a high percentage of recycled content.

While the present state of technology requires governmental subsidies to support moving to a greener economy, the green technology movement continues to be a fertile area of business growth and opportunity. As the technology continues to mature, it appears as if the latest incarnation of the green revolution will gain sufficient momentum to ensure its own sustainable growth.

This article originally appeared in Larta Vox, the weekly newsletter of business technology think-tank Larta. It is reprinted with permission.

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