Cleantech towards Consumer Adoption - Crossing the chasm to mainstream


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Cleantech towards Consumer Adoption - Crossing the chasm to mainstream

  1. 1. COPENHAGEN CLEANTECH Issue #4 JOURNAL ENERGY EFFICIENCY VS. COMFORT A HUMAN APPROACH TO BIG DATA What is the building sector doing about it? Page 2013 18 In an era of technology convergence and connectivity Page 24 The VITAL ROLE of CONSUMERS CLEANTECH FOR THE MAINSTREAM A closer look at the biases in consumer behavior Page 22 Towards a Green Economy: THE NEXT FRONTIER IN CLEANTECH IS MAINSTREAM CONSUMER ADOPTION What does it take?
  2. 2. EDITORIAL THE VITAL ROLE OF CONSUMERS leantech has traditionally been marketed as the green –and usually a premium– alternative to other products and services. This has appealed to a niche of environmentally conscious group of consumers, willing to pay the green premium for doing the “right thing”. C ers in the growth of cleantech. Trying to provide understanding of what it takes to ‘mainstream cleantech’. Why is the mainstream consumer not buying cleantech products when it is the “rational“ thing to do? What do cleantech producers have to do to help consumers choose the green alternative? WHILE this is certainly a good start, it is not enough. The adoption of cleantech products and services by mass markets is vital for the full transition to a ‘green economy’. However, moving from niche to mass consumer markets requires more than simply scaling up production. Mainstream consumers are in many ways different from niche consumers, they buy products and services for totally different reasons. THIS ISSUE of the Copenhagen Cleantech Journal PART of the answer is that green products com- pete at average market prices, but actually, it is more complex than that. The cleantech industry is bounded by local conditions and consumer behavior. We selected key cleantech sectors that greatly impact people and asked researchers, innovators and business developers for their opinions. We hope that their different views inspire you to think in different ways when designing products and moving from niche into mass markets. takes a closer look into the vital role of consum- MARIANNA LUBANSKI EXECUTIVE DIRECTOR, COPENHAGEN CLEANTECH CLUSTER If you have other cases you would like to call our attention to, please join the Copenhagen Cleantech Cluster Group at LinkedIn. COPENHAGEN CLEANTECH JOURNAL PUBLISHER Copenhagen Cleantech Cluster CONTENT EDITOR Samantha Le Royal ADDRESS Copenhagen Cleantech Cluster Nørregade 7 B DK – 1165 Copenhagen K Denmark Special thanks to Oliver Inderwildi and Lars Ostenfeld Riemann EXECUTIVE EDITOR Marianna Lubanski Copenhagen Cleantech Cluster (CCC) is at the core of the cleantech eco system in Denmark with a mission to foster cooperation between cleantech companies, research institutions and public organizations worldwide. Join us for a green future – together! PRINT 3.000 copies PRINTING HOUSE Clausen Grafisk Clausen Grafisk holds the Nordic Ecolabel RD IC ECOL A B EL EDITORIAL TEAM Rune Rasmussen Hans Peder Wagner COVER ILLUSTRATION Benny Box ISSN 2245-120X NO +45 3322 0222 GRAPHIC DESIGN Mattias Wohlert PAPER CCJ is printed on 100% recycled 170g Cyclus Offset paper. The cover is printed on Chromolux 700.
  3. 3. CONTENTS BRIDGING THE GAP BETWEEN CLEANTECH AND CONSUMERS If the green solutions are ready, why isn’t everyone buying them? A social approach to understand the market biases in the mainstream adoption of cleantech. Page 4 SMART PRODUCTS FOR THE MAINSTREAM? Exploring cleantech products proudly designed for consumer markets. Page 10 A NEW ERA OF LIGHTING Photo: Imagesource Now that the first light bulb vogue is ending, what can we learn from it. Can LED’s light up our homes as well as our lives? Page 14 THE COMFORT PARADOX OF EFFICIENT BUILDINGS People living in efficient buildings still require high living standards, which often reduce the energy savings, see what is being done to combine the two. Page 18 CONSUMER BIASES IN THE ‘RIGHT’ CHOICES Take a closer look of selected consumer behavioral biases. Page 22 FROM BIG DATA TO SOUND DECISIONS Photo: Benjamin Benschneider A human approach to big data in the transition to a world ruled by connectivity. Page 24 AN OUTLOOK ON URBAN MOBILITY Dr. Oliver Inderwildi shares his opinion about the future of urban mobility. Page 28 THE COPENHAGEN CLEANTECH REGION Four good cases from Copenhagen. Page 30 GREEN LABELS Awareness campaigns can succeed or fail depending on the values they target. Page 34 THE INTERNATIONAL CLEANTECH NETWORK New clusters in the network and upcoming meetings. Page 35 OPINION: GATEWAYS TOWARD SUSTAINABLE SOCIETIES Political leadership and public engagement are needed for the widespread of sustainable solutions. Page 36 ADDITIONAL READING Illustration: Benny Box Publications and resources to understand consumer driven markets. Page 38 Issue #4 · 2013 | 3
  4. 4. FOCUS BRIDGING THE GAP BETWEEN Cleantech Consumers and A BETTER UNDERSTANDING of market biases is essential for driving widespread adoption of commercial clean technologies. While the cleantech industry as a whole has the potential to scale up production of greener solutions, consumers remain wary of widely adopting them, despite environmental benefits and general financial gains. Current practices largely fail to embrace consumers as a key component in speeding development. Illustration: Benny Box 4 | Copenhagen Cleantech Journal
  5. 5. TODAY, CLEANTECH SOLUTIONS ARE HEAVILY SUBSIDIZED IN ORDER TO REMAIN COMMERCIALLY VIABLE. THIS SCENARIO IS NOT SUSTAINABLE AND NEEDS TO CHANGE. NEELABH SINGH, HEAD OF STRATEGIC PROJECTS, COPENHAGEN CLEANTECH CLUSTER I t is undeniable that our planet needs widespread adoption of cleantech solutions to supply energy for an increasing global population. The World Energy Outlook 2012 report forecasts that global energy demand will rise over one-third by 2035. In Europe, electricity is set to see some of the highest price increases. Meanwhile, the economic potential of energy efficiency will largely remain untapped. Following decades of technological innovation, investment and supportive policies, many sustainable solutions are ready for large-scale deployment. Sustainable products and services vary in scale and complexity, from architecturally sound green buildings to renewable sources of energy. Moreover, citizens across the globe acknowledge the relevance of reducing greenhouse gas emissions for the sake of the climate. The widespread deployment of these solutions would reduce energy dependency on fossil fuels, while also preserving the world’s climate. However the reality is that mainstream consumers aren’t widely adopting green solutions. The question remains, why isn’t everyone investing in energy efficient solutions, renewables, buying electric cars, and constructing green buildings? Clearly, widespread adoption involves mainstream consumers. Common business sense indicates that technologies cross the chasm when they go from early to mainstream adoption. Mikkel Rasmussen, is a senior partner at RedAssociates, an innovation and strategy consultancy that has advised multinationals like Addidas, Calsberg, Coloplast, DONG Energy and LEGO by employing methods of social science and mar- ket analysis. He explains how technologies cross the chasm. “Mass adoption is driven by social dynamics. It starts with very few people doing something unexpected. Then, it slowly grows and gets embraced by early adopters. Only when it grows, do the benefits become clearer and more attractive –price forces decrease. These experiments start becoming normal products. Only when products become better and better, does mass adoption start.” A MARKET CONSTRAINED BY CONSUMER BIASES CONSUMERS DON’T ALWAYS MAKE RATIONAL CHOICES The price argument. Convincing mainstream consumers to adopt more sustainable lifestyles remains challenging. Price is often said to be a cause of poor adoption rates. In a study about mainstream consumers, ‘Mainstream Green’ by Ogilvy & Mather reveals how the hefty price of sustainable products puts off American consumers. Another global study by McKinsey on energy Efficiency points out consumers’ lack of desire to pay premium prices of energy efficient products. Today, mainstream consumers’ buying behavior for greener products is largely influenced by THE MASSIVE MIDDLE –THE GROUP OF MAINSTREAM CONSUMERS THAT OFFER THE BIGGEST OPPORTUNITY TO CREATE THE CHANGE THE WORLD SO NEEDS. OGILVY & MATHER Issue #4 · 2013 | 5
  6. 6. THE FARTHER THINGS ARE IN TIME, SPACE AND OUR WORLDVIEW, THE HARDER IT IS TO CONNECT WITH THEM. SIMRAN SETHI, STRATEGIST AND AUTHOR price. Still, consumers often make decisions on factors beyond price. Simran Sethi is an award-winning journalist, strategist and educator who teaches and reports on sustainability and environmentalism, named a “top eco-hero of the planet” by the UK’s Guardian. She explains, “Appealing to our wallets is critical –especially as we all work our way through the economic crisis– but we are not purely rational beings who always maximize utility. We need to think about not only changing behavior, but also activating the values that undergird our identity”. It is unlikely that lower prices alone will engage mainstream consumers to change current choices and behavior. “If you want to convince consumers to buy something new, the best you can do is to relate to them in terms of their needs and desires, and not only by giving them rational choices based on price and savings”, says Rasmussen. PEOPLE PREFER AVOIDING LOSSES OVER ACQUIRING GAINS Consumer behavior. Observations of consumption behavior indicate that people often make quick choices and irrational ones. Consumer 6 | Copenhagen Cleantech Journal choices are often the result of desires for a momentary peace of mind. According to Sethi, we suffer from single action bias. “Our brains are still fairly gross instruments, we respond to immediate threats and immediate pleasures. We seek immediate comfort, we respond to stimuli in our immediate environment” she says. A desire for immediate comfort usually doesn’t connect with sustainable choices. In Europe and North America consumers often equate having more with better lifestyles. A problem then arises when they are asked to change behavior, not only to consume different and more expensive products, but also to consume less. This behavior connects with people’s fear of losing what they are accustomed to. Sethi comments, “Loss aversion –a propensity to avoid losses even in the face of potentially higher gains, over a long-term– might explain the broader desire to cling to our overly-consumptive, energyintensive lives as an effort to avoid the loss of immediate comfort.” CONSUMERS PREFER IMMEDIATE PAYOFFS TO DELAYED PAYOFFS What motivates consumers. When explaining consumers’ choice of short-term gain versus long-term payoff, Sethi says that consumers tend to seek immediate gratification. “What we must do is strike a sweet balance, offering some degree of immediate gratification along with the promise of a longer-term reward. That is why, for example, feedback mechanisms that chart energy usage –and make that information immediately available to consumers– are an essential step to inspiring long-term behavior change.” Elaborating on how to work around immediate gratification bias, Rasmussen notes. “We need to learn how to motivate people. Here we can learn
  7. 7. from the experiences of other markets, like pension. Pensions have value only after many years. How is it that financial institutions have convinced people to pay in? Certainly, this is partly regulation, but it is also motivation. They have become extremely clever at doing that. Motivation is the part about making the long-term benefit relevant now. For example, some pension companies offer health or life insurances too.” PEOPLE OFTEN LIMIT THEIR ACTIONS TO SOLVING A FEW WORRIES AT A TIME Consumers act upon limited choices. Despite the huge emphasis put on preserving the world’s climate, consumer studies show a gap between thought and action. Rasmussen says, “In the majority of consumers, there is a really interesting gap between consumers’ ethical perception and behavior. When you ask consumers, what are the important factors in their consumption, for about 85% of western consumers green comes at the very top. This would indicate that there is a huge market for cleantech, but consumption patterns show a different reality.” On the issue, Sethi refers to the ‘finite pool of worry’. A term coined by behavioral economists Patricia Linville and Gregory Fischer, this relates to consumers’ ability to change behavior toward greener consumption in actions they take. It explains that there is a limited number of concerns people are able to keep in mind at a given time, and therefore, to act upon as consumers. PEOPLE HAVE TROUBLE RELATING WHAT THEY DON’T EXPERIENCE First hand experiences matter. Can consumers actually connect the dots between buying sustainable solutions and saving the planet? A few ideas from sociology shed further light on consumer behavior. For example, the Giddens’ CLEANTECH WOULD be an obvious choice for people concerned about the environment, but it might also appeal to others. Yet, certain barriers and some reluctance seem to hinder people from fulfilling their wishes regarding buying and using green solutions. Recent research shows that a sustainable lifestyle appeals to many and that there appears to be a willingness to change unsustainable practices into a more green way of living. But the transition isn’t easy. Human beings are bound by their practices! Practices are routinized actions that at some point turn into unreflective habits. Habits reduce the complexity of life, they save us time and reflection for each choice we make. Our habits are formed during our upbringing, when we learn to select information that fit in our conceptions of what’s right, what to relate to, and what to identify with. Sociological theories show the importance of habits and practices and make us understand why humans behave in certain ways. Bettina Hauge, PhD in sociology. External lecturer in sociology at Copenhagen University and senior researcher at the Department for Design & Innovation, Technical University of Denmark. Founder of the organization Business Anthropologists. Issue #4 · 2013 | 7
  8. 8. paradox explains that people struggle to act upon things they cannot see. Unless their immediate environment is heavily affected by climate change, it is easy to ignore and difficult to detect. Sethi shares her views on this issue. “We may feel sad about the consequences of sea level rise or plastic pollution, but this doesn’t connect to us in an intimate way. It will likely fall away.” Meanwhile, the connection between buying energy efficient products and saving the climate remains abstract. Environmental groups and green marketers break their heads reminding consumers about the consequences of unsustainable lifestyles, and promoting long-term economic savings. Yet, consumers’ behavior and consumption isn’t changing much. In some parts of the world consumption has even increased. If consumers don’t change their product choices for the sake of the climate, or for long-term economic savings, what might influence them? Perhaps other social theories provide greater insight to understanding consumers. CONSUMERS TEND TO GO ALONG WITH WHAT THEIR PEERS DO AND THINK We are social beings. People naturally care about how others think and act. “People tend to stick to a predefined version of consumption behavior that is considered normal. Most of us desire to fit in. For sustainable solutions to work, businesses and policy makers need to understand the complex relationships consumers have with their products”. He adds. “To attract consumers we should focus on creating the kind of value that taps into their desires and aspirations, instead of focusing only on the functional benefits of a product. Sustainable solutions must inspire the same desires and aspirations as the products they intend to replace” Rasmussen says. 8 | Copenhagen Cleantech Journal He gives some interesting take away messages. “Social motivation is very important, and that’s difficult for many companies to understand. In reality, the best technologies –the ones that succeed– are the ones that are socially adaptable. We know this from innovation theories. In any industry, successful innovations come from closing a gap between what people want and what you give them.” He also explains how people make decisions, and that these are guided by what is allowed in their social context, he uses solar panels as an example. “We normally do what’s accepted in our social environment. Do we paint our houses pink? No, we don’t. For many people, it would destroy the image of what a house supposed to be. Well, why should we add unusual looking artifacts onto the roof? There are millions of social rules that people are not always aware of, but that activate when they interact with others. RETHINKING CLEANTECH SOLUTIONS Innovation within cleantech. “What we need to do is turn the coin around and rethink technology. An idea is to think in terms of what our present world offers. The spaces that people are already living in, and where new technology can be installed. Only then, we will be solving the problem and giving people the benefits they need and seek.” Rasmussen expresses. Often cleantech makers take current infrastructure for granted, Rasmussen says. As he continues, “Take for example, the systems allowing private transportation. There is a whole infrastructure behind the fact that we drive cars. I drive a car. This car gives me pleasure and freedom, and it is relatively affordable. I am familiar with the systems that the infrastructure supports –where to refuel, repair, replace and
  9. 9. insure my car. Why should I switch to something that looks like a car but gives me uncertainty? That’s the problem for most electric cars. Beyond thinking on how to fuel our cars sustainably, we need to consider how to make mobility more sustainable. For example, by carefully looking at how people move from A to B to understand the systems they are familiar with.” WIDESPREAD SUSTAINABLE SOLUTIONS Going forward. It’s unlikely that mainstream consumers will widely adopt sustainable solutions for the sake of the climate. It’s clear that sustainable solutions must have specific values and benefits, beyond long term savings. More importantly, they need to compete in the same price range as conventional products. How can cleantech embrace practices for a widespread adoption by consumers? Rasmussen says that widespread adoption can happen through experimenting. “An entry point for many clean technologies can be experiments. Introducing well functioning technologies into everyday life. Let consumers experience cleantech with low entry barriers –not so expensive and relatively easy– then make these solutions attractive.” Another approach is making technologies more interesting while developing them. “Through design you can make new technologies more interesting, in a way that motivates people. Preferably, in ways that enable people to do things they couldn’t do before. Like today, we use smart phones because they help us to do things we couldn’t do before. However, we were first introduced to smart phones through a technology that we already know, mobile phones. This is a journey that many clean technologies need to take. ALL KINDS OF EXPERIMENTS ARE HAPPENING IN MAJOR CITIES AROUND THE WORLD. THESE INVOLVE PEOPLE AND ARE DELIVERING INSPIRING RESULTS. MIKKEL RASMUSSEN, PARTNER AT REDASSOCIATES A key message. The opportunity lies in making people an integral part of the process when developing new technologies. Rasmussen says, “We need to give consumers the solutions that they want. Solutions they understand, that are easy to use and have a fair value for the money. Most important, they should have clear benefits. It is essential to understand that people shouldn’t have to adapt to new technology. Rather, new technology should adapt to people’s needs and design its paramount for success. The question that any new technology needs to answer is: Why? If cleantech makers cannot answer that question, consumers won’t believe in it. Of course, there is a price issue we should overcome. There is also the long-term versus short-term challenge. But, we need to start thinking what people want, and see how technology can help.” Issue #4 · 2013 | 9
  10. 10. GLOBAL SNAPSHOTS PRODUCTS for the MAINSTREAM All over the world innovators are coming up with cleantech products that bring value to people because they are smart, fashionable and cut on utility bills. Some are reaching consumers through retail and others use traditional channels via existing utility suppliers. They have all something unique to offer at average market prices. FASHION Powering gadgets on the go 1 WHAT CAN your bag do beyond carrying your stuff? A product like SunnyBAG, from Austria, is a useful and convenient bag since it keeps your gadgets powered while you are on the go. The flexible solar panels outside the bags convert sunlight into electrical power and charge the integrated battery-packs via USB ports. Actually, there is nothing geeky about solar panels in these bags. This is an innovation that came up from the need of keeping mobile devices charged, giving a feeling of freedom and flexibility. In this product fashion meets cleantech and adds value to anyone with the need for charging a mobile phone or any other electrical device. Everyone knows how annoying it is to search for a charging station when your mobile phone’s battery is running low, using power from the sun is a way to solve this problem. This product is being sold around the world via retail shops at average market prices for bags. 10 | Copenhagen Cleantech Journal
  11. 11. WATER The ripple effect 2 HARVESTING rainwater is a solution that can help consumers in solving one worry at the time, namely sustainable water consumption. Rainwater harvesting is a high impact solution born from an ancient tradition of water capture. It is returning to fashion today with multiple products on the market ranging from barrels to whole-house systems. There are three elements of any harvest system, the collection, transportation and storage of water. Solutions vary depending on the use you want to make of rainwater, from garden irrigation to drinking water. RainWater Solutions is an American company producing simple and effective solutions, which affordably facilitate harvesting rainwater in recycled plastic barrels. These are off-the-shelf products sold in retail stores across the country. The company reaches consumers locally, via various campaigns and discounts programs that supply entire neighborhoods. ENERGY Switch on the renewable energy 3 DECIDING on a sustainable way of heating residential buildings isn’t a complex decision anymore. Today technology offers carbon neutral sources for heating systems using wood as renewable fuels. KWB heating systems from the UK, is a supplier that uses wood sources like log wood, wood chips or pellets to heat homes. The good old days of heating homes with wood are back, but this time it’s safe and done with carbon neutral sources. KWB operates in European consumer markets via direct marketing and in collaboration with a network of partners from the heating industry. The heating systems can be installed in any existing heat distribution system, in detached family homes, apartments and commercial buildings. Making this product a good example of easily integrating a sustainable lifestyle that significantly cuts energy bills. Issue #4 · 2013 | 11
  12. 12. GLOBAL SNAPSHOTS DATA Design matters 4 INDOOR AUTOMATION devices, like thermostats, often help consumers solve very basic problems, but Nest is a thermostat that does more than regulating temperature on command. Its innovative design has caught the attention of many consumers. With smart applications, this device completely changes the image of thermostats. Nest adjusts and remembers personal preferences, it tracks the local weather to savee energy when no one is home. All thermostat settings can be controlled via a smartphone app. All this power and the resulting environmental benefits are hidden in an attractive design. The company is reaching the market via retail. it is also working with energy providers to offer discounts to consumers for joining programs that promote using less energy during peek hours. Additionally, Nest will provide insight into personal energy use. The company acquired the online platform MyEnergy, which allows consumers to track all utility bills and compare them with similar homes and friends. Nest may be soon expanding into other energy solutions, after penetrating the consumer market with its thermostats. 12 | Copenhagen Cleantech Journal ENERGY STORAGE Home based power stations 5 IT’S POSSIBLE to house decentralized renewable energy storage in the back yards of homes. Acta is an Italian company with a revolutionary consumer product that allows the storage of renewable energy, like solar and wind. Their product uses a hydrogen technology system to store and convert energy, allowing homeowners to locally store power in a convenient and safe way, minimizing energy transmission losses. They’re making energy independent buildings a reality with cleantech products, while also showing that the uncertainties of renewable power can be overcome. In many parts of the world, living off-the-grid means no power lines across streets. Producing and controlling energy locally could also encourage people to invest in storage systems, and sell surplus energy to the grid or save it for shortage periods. Case examples of the green houses can be found in Australia, North America, and Europe. In Germany, 40% of the energy fed to the grid is owned by individuals.
  13. 13. BUILDINGS Smart Windows 7 DESIGN Creating Eco-fashion 6 JOIN THE GREEN wagon with good looking textiles in eco-fashion. The sustainable clothing movement uses organic cotton, toxin-free and natural textiles to create fashionable looks. In Denmark, Katvig is a producer of eco-children’s wear, it’s become an icon after 10 year in business. The signature designs, apples and trees, are simply fashionable among the Danes. Their designs are also sold internationally via retail. When it comes to fashion, appealing to consumers’ tastes isn’t strictly about ethics. The Katvig brand stands for eco-fashion that’s popular among mainstream consumers. The focus is first made on appearance and eye-catching clothing. Katvig then helps consumers identify the most sustainable cloths in their collection, using badges and labels with information about the garment composition. International certification by third parties is part the Katvig standard. The brand also ensures that textiles are free of chemicals, making them better for the skin, and uses recycled textiles for a lower environmental footprint. SEARCHING for comfort is a recurrent practice for people and living sustainably is a growing trend, but changing our daily behavior is a complex matter. More and more we experience that clean technologies can help us meet both desires. Smart windows are products that does the job simply, and a brand new product is the RavenWindow. Dynamic windows that darken to block the sun’s heat, but when it’s cool, they lighten to let the warmth of the sun in. This is the kind of technology that provides users with peace of mind, enhancing comfort and a green lifestyle. The technology can actually be used in various applications, but Ravenbrick chose to expand their intelligent solar window solutions for residential and commercial buildings. The RavenWindow is reaching the market this year with promising adoption forecasts, also because it solves some of the energy challenges of green buildings, reducing heating and cooling costs. The company partnered with the second world’s largest fabricator of glass, which reaches consumers in 60 countries. But it is yet to be seen how the RavenWindow will reach mainstream adoption. Issue #4 · 2013 | 13
  14. 14. By xxxx A NEW ERA OF LIGHTING After a century of being the lighting standard across the world, the incandescent bulb will soon be history. New lighting technologies are becoming widely adopted and LEDs are fearlessly becoming a new standard. What can new technologies learn from the first bulb’s vogue of the last century? 14 | Copenhagen Cleantech Journal
  15. 15. SOLUTIONS Photo: Imagesource xxxxx O NE WAY TO EXPLORE LEDs’ path to become the standard of this century is to learn from its predecessor. Highlighting why the incandescent bulb became the global lighting solution of the past century and how LEDs can do the same, crossing the chasm into mainstream adoption. A PIONEER LIGHTING TECHNOLOGY Electric lighting history began with experiments in the 18th century. Following its initial invention, dozens of scientists struggled to develop stable light bulb designs that could replace gas lamps. The early adopters, suffered many annoyances. Light bulbs would last for only a few hours. Some bulbs stopped functioning if there was an interruption of electricity. More importantly, these light bulbs were also costly and difficult to commercialize. Through experimentation, incandescent bulbs eventually improved, and lasted for a couple of months. By the end of the 18th century, the design had become practically feasible. The technology then began to spread into homes. Hundreds of companies joined the new business of electric lighting, and many diversified their involvement into related markets. They also began to develop the infrastructure for mass consumption, producing systems for the generation and transmission of electricity. Further improvements followed the spread of electric lights. Light bulbs benefits became clearer to consumIssue #4 · 2013 | 15
  16. 16. CURRENT POSITIONING OF EFFICIENT LIGHTING TECHNOLOGIES ON THE MARKET TRANSFORMATION CURVE Market share First generation of LEDs 100% Architectural Lighting 50% Residential 25% Outdoor area lighting Solar-power street lights 10% 5% Innovators Leading edge adopters Early adopters Early majority Late majority Mainstream Model: Vrinda Bhandarker, Led Lighting Market Trends ers, they lasted longer and prices decreased significantly. Incandescent light bulbs crossed the chasm, moving from being a new innovation into a beckoning product. Some argue that the light bulb profits helped to pay for the electric system installation. Either way, the technological advancement laid the foundation of a whole industry of electric appliances and supplies. But, the transition was still difficult. Electric lighting replaced a well-established industry, the mature and profitable gas lighting incumbent. People were also accustomed with the idea of light- 16 | Copenhagen Cleantech Journal ing with gas. Regardless, the first light bulb became incredibly popular, and has been for over a century. long run, highly efficient lighting is likely to become the new standard of the 21st century. REGULATION BOOSTS LIGHTING STANDARDS Still, consumers are the ones left to make the choice when picking the best lighting technology for their homes. The problem is that people aren’t accustomed to paying ten times more, for what is seen, the same product –just an electric light bulb. Furthermore, people are accustomed to the kind of light the first bulb emits. The difference between conventional and new lighting can be a big monetary and habit gap. Today, new regulations in developed nations are pushing for greater energy efficiency on behalf of their citizens. Since conventional bulbs are hugely inefficient, new energy considerations set focus on developing lighting further. Consequently, legislators have set a course for lighting to cut energy demand and carbon emissions. Modern lighting solutions, such as LEDs, are increasingly being adopted. In the
  17. 17. Illustration: Rasmus Juhl A REALITY CHECK FOR LEDS Electric bulbs paved the way for LEDs to become off-the-shelf products. Modern lighting solutions are able to take advantage of the existing global infrastructure, and have moved beyond the experimental phase. That brings LEDs a step closer to crossing the chasm into widespread adoption, and the next step is lower price. The current high prices of LEDs will be overcome by widespread adoption. The Climate Group, in Lighting the Green Revolution, states that LEDs are reaching a tipping point. By 2020, they are expected to reach over 60% of the global general lighting market, and prices are predicted to drop 85% in conjunction with higher demand and production ramp up. Additionally, LEDs perfectly serve the goal of energy efficiency set by governments. They use only a fraction of the energy that incandescent light bulbs use, and claim an exceptionally long life span. Namely, at least 50,000 hours more than the first light bulb, this has helped LEDs to gain market share, as they offer clear product benefits and superior performance. However, LEDs seem to reach beyond improving energy efficiency, their developments include low maintenance cost, high optical performance and aesthetic quality. Finally, studies such as Lighting the Green Revolution reports on a wide range of social benefits of LEDs. For instance, they offer an opportunity for technology diversification into new products and light components to improve lighting conditions for outdoor safety, indoor learning and health conditions. Are LEDs’ social benefits translating into new products similar to the light bulb’s vogue of the past century? Lighting Lives THE FUTURE of lighting technology lies in boosting its social benefits. From candles to LEDs, nowadays we think of indoor light in new and different ways, and its technological development has been of absolute relevance to society, and it will continue to be. Especially as producers keep paying attention to new ways, in which lighting, can enhance the well being of humans. LIGHT HAS always been a component in the evolution of societies, repre- senting life, nature and rituals. But today, we understand that lighting does more than simply illuminating. The possibilities it has to improve quality of life seem endless. “In the future lighting may be used in more exciting ways. In designs that relate to what lighting has always meant for humans: security, warmth and closeness. The technological wave of smart systems seems to be entering homes in the same fashion as the electric bulb did. But there is more to come, lighting may become part of all kinds of products. One could be windows that, in winter time, emit the light of summer days. Or integrated into textiles where the lighting might serve as a security signal on cyclists or road workers,” states Betina Hauge, PhD, senior researcher at the Department for Design & Innovation, Technical University of Denmark. THE LIVING LAB is an initiative that tests LED technologies real life con- ditions, in various public spaces in the Copenhagen region, in Albertslund. Lighting systems are evaluated while used in full scale. The projects run in collaboration with different specialists that evaluate lighting on factors including health, security and energy efficiency. “Testing the lighting capabilities in real indoor and outdoor spaces allows us to identify the best lighting systems for specific purposes. In our projects we think that the integration of users is basic and from our studies we know that lighting makes living conditions better. An interesting project is the living units for the elderly. In this project, we test and develop lighting systems that improve the visibility and health conditions of the elderly. For example, at nano-scale, we mix colorimetric spectrums of LEDs and test their potential to improve the production of hormones and enzymes,” explains Flemming Madsen, project manager of the Danish Lighting LAB. Issue #4 · 2013 | 17
  18. 18. THE BULLITT CENTER IN SEATTLE, U.S.A, is one of Photo: Benjamin Benschneider the greenest office buildings in the world. It’s 100% powered by solar and its windows are controlled by a computer “brain” that determines when they should pop open to freshen the indoor climate. 18 | Copenhagen Cleantech Journal
  19. 19. THE COMFORT PARADOX OF EFFICIENT BUILDINGS In the race to obtaining greater energy efficiency, successfully converting existing buildings into more efficient ones is paramount. The problem comes down to reducing consumption, producing economic gains for owners and suppliers and attaining building comfort for users. But, this balance isn’t always mediated in projects. A n array of green technology solutions coupled with new business models can attain greater savings in buildings. This often includes modernizing everything from heating and cooling systems, windows and insulation, to efficient lighting and control management systems. When buildings are transformed to have higher standards, entirely new user practices are needed. For instance, changing to energy saving windows is of little help if building users constantly open them. Hence the norm is that people must live with new systems and settings of- ten no longer controlled by them, and potentially reducing their comfort and satisfaction. However, the long-term economic and environmental gains of such projects depend largely on how buildings are used and managed after being retrofitted. Therefore, can efficient buildings deliver both comfort and savings? Practices in the building sector don’t always consider comfort as a key parameter, neither they consider the impact people could have in energy savings from using buildings differently. But, technological solutions are not enough. Energy efficient projects and savings are also dependent on people, says senior researcher Henrik Nellemose Knudsen, PhD, from The Danish Building Research Institute in Arhus. “We often see that savings are not as big as expected because of human behavior. The way people interact with, and understand how low energy buildings function is very important. Studies show that there are a number of factors that trigger satisfaction and dissatisfaction of building users. For example, employees working in low energy buildings can become dissatisfied when they aren’t able to control the indoor climate.” Savings in greener buildings are largely affected by indoor climate settings, such as lighting, temperatures and airflow, and for many building users, controlling indoor climate is important. However, a centralized control of indoor climate is often needed in order to achieve savings. Professor Knudsen comments, “Retrofitting buildings to higher energy standards, require improvements, such as replacing windows and installing better insulation. Well, these measures also deliver a more even distribution of the indoor climate and temperatures, which often equals to the usage of more energy to improve comfort.” In reality, there are a number of business models to aid the management of efficient buildings projects, and their maintenance. Some approaches focus on energy savings, while others recognize factors like satisfaction and comfort of users. Energy Service Companies, ESCOs, are the supIssue #4 · 2013 | 19
  20. 20. DESIGNED TO LAST 250 YEARS, The Bullitt Center is made from sustainably harvested wood and makes no use of Seattle’s public water supply, it harvests rainwater. The largest change for the users and tenants, compared to any other building, are its composting toilets, as they have to flush the toilet before and after using it. Photo: Benjamin Benschneider pliers of efficient equipment and services for retrofitting buildings. These companies are the ones in charge of transforming buildings into being efficient. ESCOs often work under the framework of Energy Performance Contracts, EPCs. The contract stands as the guarantee for energy savings and rules for the energy saving project. 20 | Copenhagen Cleantech Journal However, there are challenges that aren’t always foreseen, the comfort of users is one of them. Johan Coolen, Partner at Factor4 in Belgium, is a project manager of energy projects, and he explains about the importance of meeting everyone’s expectations when designing an EPC. “Practice shows that when a contract is constrained by rigid rules and tacit results, at least one of the parties gets dissatisfied. The ESCO’s interest is supplying solutions and services, and achieving savings. On the other side, building owners expect optimal comfort and to avoid further investments. There are multiple approaches for EPC projects, and they vary largely from country to country. The classic approach focuses on energy savings and targets, but this can be problematic. There are a countless number of factors difficult to predict.” He also points out that when the focus is put on saving targets, the project is likely to deliver weaker results on ar-
  21. 21. eas like comfort. “Human behavior is one of the factors that can influence saving targets, but also changes depending on outdoor climate. When building temperatures are set in beforehand, you have very little opportunity for adjustments. Then, comfortable temperatures for users could be threatened because of other factors, such as extreme weather conditions”, Coolen says. The model developed by Factor4 seriously takes into consideration the ‘human aspect’ and flexibility for adjustments. It also includes rewards and penalties according to performance. He adds, “For the success of EPC projects, it is necessary to meet everyone’s expectations, as much as possible”. Generally, an EPC project represents a long-term investment carefully evaluated, in order to achieve savings and lessen risks. In most cases, it makes economic sense to improve a pool of buildings. Coolen states, “Typically, an EPC contract last for a period of 10 to 15 years, in which the ESCO commits to a 25% of energy costs savings combined from a pool of at least 5 buildings, accounting for a minimum of 1 million EUR of energy costs. The contract has specific rules for both parties, it is not allowed to raise energy use or decrease the comfort in buildings. This can be the case for office buildings, where EPC rules impact the way employees should use workplaces. For example, retrofits can lead to closed windows environments and a centralized temperature control, and new sets of limitations are not always popular among all users.” Knudsen comments, “It is essential to have a strategy and guidelines that everybody understands and communicate who takes care of the indoor climate comfort. It is about minimizing dissatisfaction of efficient buildings and systems, and equally important is that, once users move into efficient buildings, technologies should work properly. Coolen says, “Comfort is a key parameter to take into consideration, and it should be included in the contract. We know from scientific research that telling users ‘don’ts’, instead of ‘do’s’ make people less responsive.” The aim should be to deliver savings and comfort by considering them equally important. It is reasonable to say that, the usage and culture of workplaces could influence the savings planned for efficient buildings. There are several surveys and studies that point out this issue, for example, the Institute for Building Efficiency in Washington developed a survey to assess the culture of greener workplaces. Other approaches call for bridging the gap between healthy buildings and highly efficient ones, in a manner to allow multiple types of management models. Regardless of constraints in culture and local building practices, attaining comfort in efficient buildings should be expected and practices across regions can provide more answers. Coolen concludes, “We spend a great deal of time studying EPCs designed in many countries. Additionally, we also learned from research that comfortable workplaces could increase employee’s productivity. Therefore, we incorporate these factors into the future value of efficient buildings. Furthermore, we put emphasis in the fact that, when a contract ends, property owners are left with functioning buildings and higher property value. All these factors are incentives for property owners to enter an EPC project. Comfort, productivity, property value and savings, can be successfully incorporated into the value of a project and measurements during the lifetime of the project.” “Comfort is playing a bigger role in energy performance projects. Generally speaking, the indoor comfort of buildings is influenced by temperature and air quality, and sometimes we need to reduc e energy saving measures in order to improve comfort. This was the case of a school in France, where improving the indoor temperature during ‘hot summers’ was also a requirement for modernizing the building. There, CO2 sensors were installed and connected to a system that partially opened windows to improve air quality. Still, the objective of such projects is to save energy, but often a balance between the savings and comfort is needed. Better comfort in buildings can also motivate customers to take the bothersome decision of making their buildings efficient. The building sector consumes 40% of all energy used, therefore Energy Performance Contracts (EPCs) are an important instrument to untap the potential of energy savings in buildings. The EPC model represents a solid investment in the future that allows improvements to be paid from energy savings, and as practices and technology keep evolving, the gap between comfort and building efficiency will become narrower” Stéphane Le Gentil is the Chairman of the European Association of Energy Services Companies (eu.ESCO). He is the Director of the Centre of Excellence for Energy Solutions at Jonson Controls. Issue #4 · 2013 | 21
  22. 22. We don’t always make rational choices Rational choices aren’t always the ‘sexy’ ones. Consumers seek to fulfill current needs and desires, and they make choices based upon the kind of benefits that satisfy those. We prefer avoiding losses over acquiring gains The meaning of ‘losing’ is incredibly unattractive. Consumers feel much worse about losing what they are used to having, than obtaining gains from new things. Illustration: BENNY BOX HUMAN BIASES COMPANIES GENERALLY expect consumers to make choices based on rational factors like price, functionality, design and brand recognition. Yet, consumers often fail to make the “right” choices leaving research departments confused. A look into the human mind offers some explanation to why people make the choices they do. 22 | Copenhagen Cleantech Journal We favor immediate payoffs to delayed payoffs Consumers like rewards and they want them ‘here and now’. They prefer getting smaller immediate rewards than waiting to receive a larger gratification later.
  23. 23. We often limit our actions to solving a few worries at a time In everyday life, consumer considerations for a more sustainable lifestyle are often plentiful. Even so, most consumers only solve a limited number of concerns. We relate to what we experience Most people act according to personal experiences acquired from local environments. Hence, consumer changes in behavior require experiences of what’s seen and learned locally. We tend to go along with what peers do and think The large majority of people like to be perceived as normal. Therefore, they seek the acceptance and belonging of certain social groups. A social happening can lead to the kind of choices that provoke changes in behavior. Issue #4 · 2013 | 23
  24. 24. FROM BIG DATA TO SOUND DECISIONS The decisions we make are supported by information we are able to glean at a given time, from our homes, our cities and our environment. However, there are limits to our natural ability to use and interpret large datasets. While technology convergence is expanding, it allows to access large amounts of complex datasets in real time. Could technology convergence help us to understand data and help us make better choices? WE LIVE surrounded by technology capable of tracking and transmitting data. Harnessing ‘Big Data’, data generated by people and machines ranging from radio signals to financial information, already bring impressive amounts of information about weather conditions, pandemics, food safety and forest fires. But in practice, these datasets are oftentimes difficult to collect, compare and understand, hindering our ability to make informed decisions. Alicia Asín explains the ecosystem of data produced from sensors. She is the Founder and CEO of Libelium, a Spanish company that develops hardware for sensors systems that are already powering smart cities with data around the world. “Now we are able to collect data everywhere in our environment, infrastructures, businesses and even ourselves. With the help of 24 | Copenhagen Cleantech Journal sensors, we can monitor any environment that seems inaccessible and hidden. Form pollution to waste and noise, allergic components in foods, energy and water consumption. Really, anything you can think of. Sensors can produce terabytes of valuable data. We know that the European Environmental Agency sees the future completely embedded with sensors”. Using compiled datasets to monitor energy could aid reducing our environmental footprint by far more than any regulatory framework. The Internet of Things (IoT) is a technological idea for monitoring and exchanging data between products and people. Alicia comments, “The connectivity revolution has already started. The Internet of Things is the next technological revolution with more than 50 billion devices connected by 2020, in which a ‘smart environment’
  25. 25. ECOSYSTEMS OF DATA SMART CITY SERVICES can create ecosystems of data. By capturing and processing big data, information can be made readily accessible via mobile phones and other electronic devices. Applications for smart services are countless, sensor technologies are enablers that can harness data from our local environment. They are able to help in making informed decisions about issues in our community, our workplace, and even while shopping. Air pollution Controlling carbon emissions and pollution emitted by cars and factories Forest fire detection Alerts for preventive fire conditions and monitoring of combustion gases Smart roads Warning messages about weather conditions and traffic jams Traffic congestion Optimizing driving and traffic routes and monitoring sound in real time Intelligent shopping Getting advice about the presence of allergenic components or expiring dates in foods Smart parking Water quality Finding free parking places in the city and security in public areas Controlling the quality of drinkable water, from rivers and the sea Waste management Detecting rubbish levels in containers and better ways for handling waste Smart City graphic printed with kind permission by Libelium Issue #4 · 2013 | 25
  26. 26. Photo: GreenWave Reality SMART HOME SOLUTIONS. Energy meters and visualization, lighting, and monitoring systems are among the solutions enabling homeowners to join the smart home trend while getting a better understanding of their consumption in real time. The market winners will be intuitive products that minimize the effort necessary for consumers to make sound decisions. is emerging. I am certain that it will completely change our world. Eventually, the data from sensors placed around our cities will be available via mobile communications and offer possibilities never experienced before –data that matters to us will be accessible everywhere, at any time.” TECHNOLOGY CONVERGENCE EMPOWERS CONSUMERS However, a major challenge for many smart products and services is to enter consumer’s homes and capture this enormous savings potential. Based on the ability to extend the value of smart meters into consumer’s homes, appliances that function within communicative networks could harness and share data to reduce consumption and aid people in making better decisions. Greg Memo is the CEO of Greenwave from the U.S.A, a global innovator of smart home services that manage energy usage and monitor utility services. He says “Consumers value greater visibility of their energy usage. Monitoring and controlling energy use through smart platforms improving their ability to easily conserve energy, save money and enhance lifestyles. It is important to give consumers the kind of experience that will keep them engaged. This can happen while using a wide range of devices including computers, smart phones and 26 | Copenhagen Cleantech Journal tables, in which people can easily adjust home devices and appliances according to specific needs. For instance a home away and night settings to be executed by the push of a bottom.” Home smart systems could empower and engage consumers to make better decisions from systems that make complex datasets readily accessible. Memo comments, “All these management solutions provide unparalleled ease of use and lifestyle improvements at an affordable prices. We often partner with utility companies that by offering our products, at the same time they increase customer loyalty rates by giving home owners full access of their consumption information”. Innovative business models keep popping up, and a new connectivity business norm is emerging. Information that is made convenient and easy to understand could truly change people’s behavior while introducing new habits. Dr. Ron Dembo shares his experience about innovative ways of sharing and engaging people with the aim of improving quality of life by making informed decisions.
  27. 27. DOES DATA DO ANY GOOD FOR PEOPLE? Dr. RON DEMBO, Founder and CEO of ZEROFOOTPRINT, from Canada, is a developer of applications that share big data while converting it into useful information for groups of people. The thing about big data is that it can only be used if it is translated into terms that people understand. If I give you a sheet of paper with every kWh you used in your life, this doesn’t really help you. It doesn’t help you to change your behavior or change your impact for that matter. The trick is really to go work out the ‘last mile’ of data. Basically, there are many kinds of data in different places, in different frequencies about us. Taking data and converting it into something like a picture of our behavior would help to move our behavior. The really good thing to do is often the challenge. THE PROBLEM IS For example, in Canada, the average person spends 3 dollars a day on electricity –which is less than a cup of coffee in Starbucks. This is not material to us. That’s why the social part becomes very important. The way you change people’s behavior it isn’t by telling about saving money or saving the world. It is telling people how they are doing comparing to their friends. Another way to motivate people is the group pressure. CREATING VALUE FROM DATA We believe in working out the ‘last mile’ of data. Taking the data that is already available and turning it into information that can change people’s behavior, and overtime their environmental impact. Our experience is that people are motivated by group goals, achieving goals and getting recognized. We present sets of data about energy usage, health or transport in ways that engages people. MAKING SENSE OF DATA The idea is to always come up with things that are extremely simple, but that people understand. For example, using common metaphors. One can be defining what’s ‘green’ behavior. What’s does that actually mean? Actually, a simple thing to do for defining ‘Green’ is to take the distribution of people alike. For example the ones that call themselves ‘green’ and compare the energy usage among them. Then, when you look at that distribution a very simple definition of green is the top 3. This is a definition people can relate to. If you compare the energy usage of a household in Copenhagen to any in Canada, the result is so far out that it would not motivate anyone, Copenhageners use much less energy. Likewise, it would not be fair to compare a household in Bangladesh to any in Copenhagen. THE KEY INGREDIENTS There are two key ingredients: using relative measures and using simple ones. Measuring is only one piece of the puzzle, but it is a basic one –you have to have it. But, giving the information is not enough. It requires an easy activity and a social group to engage people, for example to benchmark each other. The Internet of Things is going to be a fantastic enabler and is coming and happening very fast. I would say: it is probably the ‘hottest’ thing today. Issue #4 · 2013 | 27
  28. 28. Q& A URBAN MOBILITY “The urban mobility challenge demands solutions that consumers can accept and afford.” Dr. Oliver Inderwildi HEAD of the Low-Carbon Energy Centre at Oxford University Smith School of Enterprise and the Environment. Co-author of the book: Energy, Transport & the Environment: Addressing the Sustainable Mobility Paradigm. He serves as Advisory Board member for Energy & Environmental Science and the Energy Harnessing working group of the World Economic Forum. 28 | Copenhagen Cleantech Journal Illustration: John Wilson The transition to low-carbon mobility requires many changes. It requires changes in behavior, in policy design, investment, and public and private collaboration. Key focus factors are the constraints of energy supplies and decarbonizing electricity. Expanding global economies will result in an increasing demand for energy that is hard to supply. Towards the transition to sustainable urban mobility, collaboration between governments, financial institutions and large corporations is needed. Dr. Oliver Inderwildi provided an outlook about the future of sustainable urban mobility.
  29. 29. WHAT NEEDS to be done to have a sustainable ur- ban mobility landscape by 2020? There is a lot we can do with urban mobility. The first thing we should do is to support alternative motor transportations. Bike and car share schemes in urban areas are critical. On the more technological front, many European cities have underinvested in public transportation. Here, I see as critical to focus on public fiscal expansion. Renew urban transportation systems. They would help to decarbonize and enhance the economy. Essentially, replacing them by systems such as electric buses, subway connections and high-speed rail. I think governments will play a critical in order to create alternative energy markets. New frameworks for alternative energy supply will attract big corporates and financial corporations. Keeping in mind that economic growth and energy consumption are linked, what governments have to do is to reduce risks. For instance, if governments are changing energy policies every couple of years, then, financial institutions and utilities will be careful when investing in existing alternatives –carbon, nuclear and renewables. That is the case for Germany’s energy policy that, by shutting down nuclear plants, opened market possibilities for alternative sources of energy. What governments have to do is to set out the kind of policies that the next governments won’t redo. Then, you will get investment in these markets. WHAT ARE the detractors in the transition of a sustainable urban mobility in the next decade? Quite frankly, I see that none of the alternative technologies have fully taken off yet. We are talking mainly about the fuel cell and electric vehicles (EVs). Here the risk is with the consumer. Are EVs really going to take off? Will there be recharging stations all over the city? Are the batteries really going to improve? Will prices drop in a few years? Again, it comes down to giving security. Another detractor is that many sustainable mobility projects have very low lean time, for instance, EVs battery life, and the hydrogen storage and distribution problem. Electrification of road transportation takes time. It is certain that we will be driving fossil-fuel fleets over the next decade. In the short-term, we need to make cars efficient, so we can make an efficient use of current oil supply. Meanwhile, we give time to alternative fuels to mature. Then, we can let the market decide which options are the best. WHO ARE the enablers of the urban sustainable mobility? Governments and local authorities are the people, whom I see, have to set out the framework and reduce risk for investments. Then, we are asking the big multinational corporations and financial institutions to sponsor new systems. If we get the large car manufacturers to work together with the big investment banks, then, we can change a lot. We also need the powerful corporations and different types of government to work together. So, there is no single enabler. What we really need is collaboration. An institution that is making a great contribution is the World Economic Forum. They are getting the right people together to stimulate different cooperation. I think that’s essentially critical to develop cost-effective low-carbon technologies, catalyze manufacturing, and consequently provide incentives for consumer uptake. Another force that will influence is the price of commodities like oil. At the moment we see an enormous growth from emerging markets, and if, western economies pick up again, then oil prices will go up. Here we are talking about securing energy supplies, resilience and mitigating the risks of price volatility. The countries that make a smart use of existing energy resources will be the winners in the long run. WHAT WILL it take for new mobility technologies to reach widespread? At the moment, alternative technologies are not ready for the mass market. These technologies are not really practical. The problem is that, if there isn’t a big market, the development of new technologies will be slower. For instance, if there would be a big market for EVs at this moment, I am certain that we would see a very quick evolution of these vehicles. However, there is a first mover disadvantage. Today, you can’t be sure that there will be enough charging stations or that the next generation of batteries will be better. On the other hand, it could be that EV’s completely takes off, and then, you have bought a vehicle that is much more cheaper two years later. Let’s remember the first generation of mobile phones from Motorola. They weighted about two kilos, and two years later, they were only ten percent of its original size. There is a first mover disadvantage and that is what keeps people from buying alternative technology. On the other hand, there are quite a few cities that have made tremendous success in developing public transportation systems. For instance, in Berlin and Paris, they developed a very good connectivity to subway and high-speed rail networks. Actually, making public transportation very convenient and confortable, in a way that there is no social stigma attached to it. Then, you can transfer a lot of the private transportation demand into public transportation. That’s really something that has worked. The urban mobility challenge demands solutions that consumers can accept and afford. Issue #4 · 2013 | 29
  30. 30. PROJECTS THE COPENHAGEN CLEANTECH REGION FOUR EXAMPLES OF GREEN BUSINESS THINKING 1 NEW DATABASE SHOWCASES CLEANTECH RESEARCHERS AT THE UNIVERSITY OF COPENHAGEN Photo: University of Copenhagen Companies and universities rely on each other for the exchange of knowledge and both parties benefit from collaborating. Innovation is generally perceived as the key to development, added value and growth are often created in innovative processes –even in times of economic crisis. The source of innovation is new knowledge or knowledge used in a new way. An increasing share of the research done at the University of Copenhagen is in collaboration across public and private sectors and European borders. Cooperation with companies and institutions is of great importance as it enriches and broadens the quality of the university’s activities. For companies is a unique opportunity to gain access to research-based knowledge, equipment and students’ academic competences. Since the University of Copenhagen is big, it can be difficult to find the most relevant research group to collaborate with. But, the partnership with Copenhagen Cleantech Cluster enables to showcase the university’s competences in a database covering researchers working with cleantech, in categories like green energy, energy storage, air and environment, water and wastewater, sustainable materials, waste and recycling. The database is available online and will be expanded during next year. 30 | Copenhagen Cleantech Journal For more information contact Birgitte Neergaard, Project Manager, by email to or by phone to +45 2494 2524.
  31. 31. Photo: Municipality of Copenhagen 2 COPENHAGEN IS GREENEST IN EUROPE Copenhagen has been awarded the EU Commission’s prestigious European Green Capital Award for 2014. The Danish capital received the award for, among other reasons, getting more people to cycle and for the city’s ambitious goal of becoming carbon neutral by 2025. Three out of four Europeans live in towns and cities, placing mayor cities at the heart of the environmental challenges. For a considerable period of time now, Copenhagen has taken on the challenge. Copenhageners are good at leaving the car in the garage and taking their bikes instead, they can go for a swim in the clean water of the harbour and Copenhagen has just published a green account that shows remarkable reductions in carbon emissions. For these reasons, the Danish capital got a green pat on the back from the EU Commission in the form of a prize as European Green Capital 2014 - ahead of 17 other European cities. ”This is an international recognition of our dedicated efforts,” says Frank Jensen, Lord Mayor of Copenhagen, and continues, “And it is something Copenhageners can be really proud of every time they get on their bikes or take a swim in one of the harbour swimming pools. Our efforts are not only about a greener Copenhagen. They are also about a healthier Copenhagen and a Copenhagen which is nice to live in.” CREATING A MORE LIVEABLE CITY To become the European Green Capital 2014, Copenhagen and the other 17 candidates were judged by a panel of experts in twelve specific areas within the sectors of environment, climate and green growth. Copenhagen was awarded top marks ahead of all the other cities. In nine of the twelve areas, the technical jury assessed Copenhagen to have achieved the best or second best results of all 18 cities. Issue #4 · 2013 | 31
  32. 32. “Copenhagen leads the field in many areas, but we are constantly working on giving Copenhageners an even greener and more liveable city. So, we want to show the rest of Europe how to make green urban solutions that work and create new possibilities for the citizens. At the same time, we want to learn new things from other cities all over Europe so we can make Copenhagen an even better place to live,” says Ayfer Baykal, Copenhagen’s Technical and Environmental Mayor. Photo: DTU PROJECTS 3 SHARING COPENHAGEN 2014 Copenhagen is committed to collective solutions to common challenges. Partnerships, cross-border collaboration, and inspiration from other cities are crucial in order to create a green, carbon neutral city that is pleasant to live in. This is why ‘sharing’ will be the focal point when Copenhagen, in its capacity of 2014 European Green Capital, becomes an international role model. Copenhagen Cleantech Cluster’s Executive Director, Marianna Lubanski looks forward to showcasing Copenhagen’s Green solutions. “To showcase our Region’s strong cleantech competences we need global attention. The European Green Capital Award is a great platform for this and at the CCC we look forward to help turning the attention into tangible results like growth and job creation.” In 2014, Copenhagen will be the place where Europe, as a whole, can share solutions, raise the skill base in areas such as the environment, climate and quality of life, and, finally, define a common agenda for green policies looking to the future and paving the way for a greener Europe. For more information please visit or contact THE CLEANTECH FACILITATOR IS A HOTSPOT FOR TEST & DEMONSTRATION Copenhagen aims to be the world’s first carbon-neutral capital city by 2025. With a new political agreement, Copenhagen is ready to take action and invite businesses and knowledge institutions to join in. Developed and hosted by Scion DTU the Cleantech Facilitator is an online mapping tool that provides companies and organizations with an overview of test and demonstration facilities in Denmark. State-of-the-art test and demonstration facilities are the key to future growth. The main purpose is to match testing and demonstration needs with solutions and tools including a range of facilities offered by Danish universities, GTS-institutions and private operators. The tool stresses Denmark’s position in being one of the world’s leading technology laboratories within new green technologies. Cleantech Facilitator is a place where: • Test or demonstration facilities can offer and promote their competencies • Companies can find test and demonstration facilities matching their criteria • Companies and organizations can find partners for joint demonstration projects The collaboration between Topsoe Fuel Cell and the Danish Technical University is a perfect case on how test and demonstration projects can lead to scientific progress and enhance business development. For more information see See the film about the collaboration between Topsoe Fuel Cell and DTU Energy Conversion at 32 | Copenhagen Cleantech Journal
  33. 33. 4 Haldor Topsoe is currently expanding their production capacity on three continents – here the catalyst factory in Frederikssund, Denmark. “The corporate world in itself means nothing unless it improves the lives of people” Dr. Haldor Topsøe CATALYSTS ARE KEY INGREDIENTS FOR EFFICIENCY INDUSTRIAL CLEANTECH’S GROWTH IMPACTS PEOPLE Catalysts are essential for the world’s industry playing a key role in production of goods consumed by people. Catalytic processes also make a difference to industrial processes reducing their environmental footprint and demand for energy. Dr. Haldor Topsøe’s global vision and passion for science is catalyzing the growth of new clean technologies and a more energy-efficient industry production worldwide. Securing new “Green Collar” jobs is another way to impact people with cleantech. Haldor Topsøe is one of the corporates improving global growth of cleantech while expand- ing in Frederikssund, Denmark, in Houston, USA and a new factory in Tianjin, China, due to open early 2015. The company has 2500 employees worldwide and in Denmark alone, Haldor Topsøe 670 green collar jobs at catalyst production in Frederikssund, and the company’s expansion in the greater Copenhagen Area is set to double its production capacity by 2017. Additionally, proliferating its long-standing tradition of close cooperation with universities and research institutes all over the world, thus ensuring access to the best employees and conditions for improving industry efficiency and production yields continuously. Catalysts enable efficiency in each component of industrial production and improve sustainability. Catalytic processes convert one chemical component into another, and are involved in about 90 percent of the world’s industrial chemical processes. For instance, they are used in the production of fertilizers, helping the agriculture industry to meet the global demand for food. They are essential for producing clean fuels from crude oil and waste, removing harmful emissions from power plant and vehicle exhaust. Issue #4 · 2013 | 33
  34. 34. WHO IS DECIDING WHAT IS GREEN? LABELS ARE ON THE RISE informing consumers what’s better for the environment and energy savings, helping them to recognize and choose green products. The growing range of Ecolabels raises consumer’s awareness, and for some, also skepticism. The Ecolabel Index tracks more than 400 green labels in 190 countries from 25 industry sectors. National governments support certain labels with awareness campaigns for energy efficiency and eco-friendly products. In the European Union, the “Energy Label” uniforms buyers about the energy and water consumption of home appliances. In North America, “Energy Star” label does the same, since 1992 has helped consumers to identify greener products. In Australia, the “Energy Rating” label enables consumers to compare appliances using its ten stars rating. The “China Energy Label” also serves as a guide for consumers and manufacturers about product’s energy use indices and regulation. Labels are used in a wide range of consumer products, appliances and electronics. Labels are often part of awareness campaigns and retail efforts to promote energy savings and environmentally friendly 34 | Copenhagen Cleantech Journal choices. However, people have different ideologies when appraising the green message. Reports like the “Political ideology affects energy-efficient attitudes and choices” published in April, 2013 by The University of Pennsylvania and Duke University, explain that the green message doesn’t appeal to all. It could even be counterproductive when attempting to reach mass consumer markets. This study looked at 700 Americans to investigate how political ideologies affect people’s preferences for energy efficient products. Results suggest that despite the savings, a large part of the conservative voters deliberately chose not to buy the green alternative, hence using the green label the complete opposite way than it was intended. The challenge for effective campaigning is to communicate beyond those who already share the same values, thinking outside the value system of environmentally minded people. Campaigns can drive cleanteach adoption through creating a ‘new social normal’ by suggesting a general consensus and creating a new standard. Labels that communicate in line with the audience’s values could make those who are doubtful, adopting greener choices for other reasons than saving the climate.
  35. 35. UPCOMING ICN MEETINGS: Spring 2013 – ICN host: Renewable Energy Hamburg Autumn 2013 – ICN host: Colorado Clean Energy Cluster Spring 2014 – ICN host: Copenhagen Cleantech Cluster More information is available at THE INTERNATIONAL CLEANTECH NETWORK (ICN) … was founded in 2009 by Copenhagen Cleantech Cluster and Colorado Clean Energy Cluster. As of March 2012, the network’s partners are: • Renewable Energy Hamburg (Germany) • Lombardy Energy Cluster (Italy) • Tenerrdis (France) • ACLIMA (Spain) • Eco World Styria (Austria) • OREEC (Norway) • Singapore Sustainability Alliance (Singapore) • Research Triangle Region Cleantech Cluster (North Carolina, US) • Colorado Clean Energy Cluster (Colorado, US) and • Copenhagen Cleantech Cluster (Denmark) • Yixing (China) • Incheon (South Korea) • Ecotech Quebec (Canada). BRIDGING THE WORLD’S LEADING CLEANTECH CLUSTERS The International Cleantech Network (ICN) is the outreach platform for the world’s leading cleantech clusters. Since 2009 the platform has grown to 13 members, providing a global one-stop entry for companies, knowledge institutions and public organisations looking for business opportunities. ICN VALUE PROPOSITION • Building partnerships for R&D projects and market access • Opening doors for internationalization and product commercialization • Providing market insights and regional cleantech sector overviews • Facilitating knowledge sharing and overviews for funding opportunities SELECTED ACCOMPLISHMENTS • ICN clusters secured financing for waste-to-­ energy mapping across regions • Colorado smart grid company established EU headquarter in Copenhagen • Copenhagen and Colorado companies partnered up to win contract in US • Customized matchmaking tours for companies between clusters ICN has been labelled “EUROPEAN STRATEGIC CLUSTER PARTNERSHIP” by the European Commission Find more information at: General inquiries: Head of International Cleantech Network, Stephan Skare Nielsen, email: Issue #4 · 2013 | 35
  36. 36. ESSAY Lars Ostenfeld Riemann Group Director for Buildings in Ramboll GATEWAYS TOWARD SUSTAINABLE SOCIETIES sustainability is an ethical issue. It’s about ensuring that future generations get a change to enjoy a good life. It’s a question of serving the interest of mankind rather than individual interests. e all aim at making the right decisions. But sometimes, it isn’t clear what the right choices are, and sometimes we even ignore them because they require change. Not all of us are ready to change our current lifestyle unless there are immediate gains. In times of economic uncertainty, we also struggle to pay more for a sustainable living –eco-foods, low energy homes and sustainable transportation modes. Even when some people can afford to spend more on sustainable choices, they also afford flights across the world for holidays, having a negative impact on the environment. W Can citizens drive change toward more sustainable societies? There are multiple perspectives to the question, first of all, we have to recognize that there are two key drivers that enable change: regulation and financial incentives. K EY DRIVERS FOR SUSTAINABILITY On behalf of citizens, governments heavily influence sustainability drivers. They can adopt new laws and provide tax incentives to direct the course of consumption patterns. Nevertheless, it is really important that new regulations are coherent, easy to understand and accepted by the general population. Without public support, regulation won’t work and will limit the progress in the path to more sustainable societies. Consequently, citizens’ primary role is to elect and support politicians who promote and foster the right regulation mix and financial incentives for sustainable development. Including measures that stand up against the vested interests of powerful companies who profit from the status quo of a ‘fossil fueled society’. The second role of consumers is to adopt a more sustainable behavior. In this task, stimulating the engagement and the participation of the general public is crucial. As new clean technologies emerge, they achieve greater savings. Think 36 | Copenhagen Cleantech Journal
  37. 37. “THE FUTURE IS BRIGHT AND THE COMING YEARS WILL SHOW THE VITAL ROLE OF CONSUMERS.” of technologies like the LED light bulb, which uses seven times less electricity than previous lighting technologies. Such technologies also make energy costs become less significant in our monthly budgets. Why should we bother turning off the lights when we hardly notice the savings? Then, how can we stimulate the engagement and participation of the general public? The expectation is that people care about factors beyond savings, and that they take the right decisions –ethically driven decisions. In terms of saving energy, it would make a huge difference if people could monitor their daily electricity use and compare it with the city average. This could be shown with a simple chart on a screen in every home, and this type of awareness would help people change their behavior and eventually their habits. These patterns also apply to transportation. Most people have a number of options when commuting to work: bike, train or cars. Providing people with information on carbon emissions from different transportation alternatives and comparing the impact of people’s choices can create awareness. An easy way to provide this information can be smart phone apps. Meanwhile consumer savings are being achieved in Nordic Countries, including the use of LED lighting, energy efficient appliances and well-insulated homes, more improvements can still be achieved. “In the ‘Nordics’, the biggest potential to cut carbon emissions is on the energy production side.” Where the transition from fossil fuels to renewables is entering a stage that requires a much smarter energy grid, allowing the out-ofsync fluctuations between production and consumption. This leads us to the third role of consumers. An important component of the future smart grid is the willingness of consumers to provide their consumption patterns. Home appliances such as fridges, washing machines and electrical cars could be programmed to turn on at off-peak hours, thereby helping to balance the production and consumption of electricity. In order for consumers to accept such service provisions, there must be significant cost savings or attractive benefits. The coming years will show the vital role of consumers in this development. However, this also depends on the characteristics of emerging power storage technologies and how expensive they are. Eventually, when power storage becomes cheaper there will be hardly any reason not to have consumers on board. R ENEWABLE ENERGY IS THE FUTURE So, how does a sustainable future look? In the future, the power and heat production will be based on renewable energy sources. The sources will be a mix of solar, wind, geothermal, biomass and hydropower. The share of each source will be determined by their costs. Further in time, we will see new sources such as thorium based nuclear power or fusion based nuclear power. At that time, people won’t have to consider the carbon emissions caused by their lifestyle, it will only be a matter of considering costs. Then, people will worry about other sources that impact climate change, and how they can be mitigated. Cities will look a lot like today, but behind the facades things will be different. District heating and cooling will be more widespread and cloudburst mitigation measures will be installed everywhere. Cars will be electric and the sharing economy will burst. At our fingertips, we will access all information regarding our personal energy and other types of consumption. The future is bright, but more than anything else, it requires political leadership to get there. Nonetheless, engagement and ethically driven decisions by the public for a mass adoption of sustainable technologies is essential. Issue #4 · 2013 | #2 2012 37
  38. 38. ADDITIONAL READING Copenhagen Cleantech Cluster’s recommendation for further readings and information about consumer markets and energy topics. CONSUMER MARKETS • “Mainstream Green” a study published by Ogilvy & Mather in 2011. • “The EU in the World Report” from 2013 by Eurostat, the European Commission. • “Stocking the shelves with green” by Five Winds International is a paper from 2010. • The climate from a social perspective (translation) book from 2012 by Bettina Hauge and Peter Gundelach (in Danish). • RedAssociates, Copenhagen & New York, Conversations Online. • “Political ideology affects energy-efficiency attitudes and choices” by The University of Pensilvania and Duke University from April 2013, published by the American National Academy of Science. ENERGY EFFICIENCY • “The Energy efficiency: A compelling global resource” report by McKinsey & Company. • “Lighting the green revolution. The rise of LEDs and what it means for cities” a report by The Climate Group from 2012. BIG DATA • “State of Green Business 2013” by the GreenBiz Group and Trucost. • “Renewables Global Futures” a report by the Renewable Energy Policy Network for the 21st Century published in 2013. 38 | Copenhagen Cleantech Journal BUILDINGS • “Occupants influence on the energy consumption of Danish domestic buildings,” a study by Alborg University in Denmark done in 2010. • “Occupant satisfaction with new low-energy houses” is a study by the Danish Building Research Institute published in 2012. • “Sustainable Cultures: Creating greener work places for all” a paper published by the Institute for Building Efficiency in Washington. • “World Green Building Trends Smart Market” report by the World Building Council. TRANSPORT • “Energy, Transport & the Environment. Addressing the sustainable mobility paradigm” is a book published in 2012 by Dr. Oliver Inderwildi and Sir David King. • “Low-Carbon Land Transport” is a book co-authored with the Wuppertal Institute for Climate, Environment and Energy. • “Energy and Transport Indicators” a report by Eurostat, European Commission.
  40. 40. DENMARK has a long tradition for producing and developing clean energy and environmental technologies, solutions and businesses. Alongside this tradition a robust ecosystem around sustainability has emerged. Danish universities have a strong focus on environmental, climate and energy research, our businesses produce many strong global brands within cleantech and the regulatory framework in Denmark is supportive of green and sustainable ways of thinking and doing. AS A RESULT the Danish cleantech industry generates just over EUR 40 billion in revenue a year and employs 120,000 people. No other country in the world exports more cleantech relative to GDP than Denmark. THE COPENHAGEN CLEANTECH CLUSTER (CCC) is at the heart of the cleantech ecosystem in Denmark with a mission to foster cooperation between cleantech companies, research institutions and public-sector organisations. We facilitate partnerships, build test & demo facilities, boost innovation and entrepreneurship, host events, conduct analyses, support internationalisation activities and much more to underpin our goal of becoming the most innovative cleantech cluster in the world. FROM THE OUTSET, CCC has sought a strong international outreach. As the initiator of the International Cleantech Network, we work closely with like-minded clusters in Germany, Austria, Singapore, the U.S.A, Italy, Norway, France, Spain and many other international partners. THROUGH OUR international network, we can introduce Danish cleantech stakeholders to companies and universities outside the region. We can also bring you closer to the cleantech players in the greater Copenhagen region and beyond. COPENHAGEN CLEANTECH CLUSTER is looking forward to introducing you to our unique cleantech community! FOR MORE INFORMATION, PLEASE VISIT WWW.CPHCLEANTECH.COM Find this issue and additional reading online KALUNDBORG COPENHAGEN KOMMUNE COPENHAGEN CLEANTECH CLUSTER NØRREGADE 7B DK-1165 COPENHAGEN V DENMARK T: +45 33220222 INFO@CPHCLEANTECH.COM CPHCLEANTECH.COM