1. Business in Vancouver December 22–28, 200924
SuStainability
SUSTAINABILITY
NiNaWiNham
Inefficiency fuels green
business opportunities
If you’ve got some time off
from the daily grind over
the next few weeks, here’s
somethingtoponder:sitting
asweareatamomentintime
whentheincredibleboomof
the industrial revolution is
starting to bang up against
the constraints of a single
finite planet, how does your
company strategically pos-
ition itself for the economic
shifts and adjustments this
will bring?
To bring the question
down to size, consider just
one input: energy. If it hasn’t
clicked for you yet that your
company can realize signifi-
cant profit from energy ef-
ficiency, meet one of B.C.’s
green-economy entrepre-
neurs – Bryan Slusar-
chuk. His new company,
Greenscape Capital, makes
its profits by helping other
companies profit from ener-
gy efficiency – a niche that’s
opening wider as compan-
ies realize that energy in the
future is unlikely to be as in-
expensive, plentiful or easy
to access as we’ve been ac-
customed to.
“Our key business is get-
ting companies to retrofit
their operations,” said Slu-
sarchuk. “The payback on
thisisjustimmenseinterms
of bottom-line savings from
reduced energy cost.”
Immenseindeed.A2009
McKinsey & Company
study, Unlocking Energy Ef-
ficiency in the US Economy,
identifies US$1.2 trillion in
potential energy savings
that could be realized with
aninvestmentof$520billion
through 2020.
Creating “new” power
by reducing current ineffi-
ciency also results in big
cuts in greenhouse gases
(in jurisdictions where fos-
sil fuels are used to gener-
ate electricity) and improves
energy security.
Closer to home, the 2007
Conservation Potential Re-
view study produced for BC
Hydro identified opportun-
ities for efficiencies where
more than $10,000 GWh/
year of electricity could be
savedannuallythroughcon-
servation–enoughtopower
one million homes.
The utility has developed
multiple demand-side man-
agement programs and fi-
nancial incentives in an ef-
fort to access this mother-
lode of inefficiently used
energy. (You can find pro-
grams for your company at
BC Hydro’s website, under
the Power Smart tab.)
If there’s money to be
savedthroughefficiency,the
question is, why have com-
panies been so slow to em-
brace it? The McKinsey re-
port identifies multiple bar-
riers. Potential energy sav-
ings can be hard to measure
and verify.
Opportunities for effi-
ciencyarefragmentedacross
billions of electrical devices
in millions of locations, so
“efficiency is the highest pri-
ority for virtually no one.”
Finally, there is upfront cost
–efficiencyupgradespayfor
themselves over time, but
theystillrequireaninfusion
of cash at the outset.
That’s why Greenscape’s
model goes beyond trad-
itional energy consulting.
The company provides full-
service energy retrofits – in-
cluding financing.
“We’re able to tell them,
‘Don’t worry about writing
the upfront cheque,’” said
Slusarchuk. “We finance the
retrofit so that most of our
revenue model is based on
sharing in the energy sav-
ings over time.”
Greenscape reinvests
profitsfromitsenergyretro-
fitting business into a port-
folio of other green com-
panies including, at present,
an eco-clothing line and a
wholesaler of organic food
products.
“The retrofit business is
somisunderstood,”saidSlu-
sarchuk.
“There’s been a lack of
understanding in the busi-
ness community of just how
much increased profitabil-
ity can be realized through
simple energy savings. And
this is not a sector-specific
opportunity – every busi-
ness in the world that uses
energy is a potential retrofit
client.” Greenscape’s list of
new clients – $30 million of
newbusinessinB.C.overthe
past month – includes park-
ing facilities, a tourist lodge
and an auto dealership.
While it never did make
sensetooperateinefficiently,
the cost of doing so in some
industries has been low.
With carbon taxes, peak oil
andglobalenergyinsecurity
placing new pressures and
potential risks on compan-
ies, those costs could rise.
All of which makes it a great
time to think about getting
lean.Itjusthappensthatthis
also means “going green.”
“The context for this dis-
cussion has traditionally
been that business owners
and corporations should do
things more efficiently in
termsofenergy,waste,pack-
aging and so on, because it’s
the ‘right’ thing to do,” he
said.
“But most corporations
don’t act on that. I think the
context has to be, ‘What is
the return on investment?
Can we decrease your ener-
gy consumption, decrease
packaging costs, decrease
your transportation costs
andresultinenhancedprof-
itability – and the byprod-
uct is good for the environ-
ment?’”
Creating markets for
waste is certainly one trad-
itional approach to environ-
mental cleanup, and there
are other examples of or-
ganizations that profit from
others’ profligacy.
United We Can, a bot-
tle depot in the Downtown
Eastside,makesmoneyfrom
the 20 million returnable
containers per year it col-
lects predominantly from
trash headed to landfill, for
example.Oftentheserequire
policyframeworks,however
– in the case of United We
Can, it’s the bottle-deposit
system.
As we start to seriously
press against the limits of
a finite ecosphere, it’s inter-
esting to consider whether
the classic economic chal-
lengeofexternalities–nega-
tive environmental and so-
cial byproducts of business
activities that fall outside
individual companies’ own
cost structures – may start
tofade.Asrealcostsbeginto
reflect our actual ecological
position of interdependence
andinterconnectedness,real
business opportunities will
emerge. For those econo-
mists out there the ques-
tion is this: Is there any such
thingasan“externality”ina
completely closed-loop sys-
tem?
Slusarchuk states it more
simply.
“Cheap resources are be-
coming more scarce. Busi-
nesses that don’t adapt now
are going to be faced with
massive losses in the future,
and,collectively,it’sgoingto
spell a lot of trouble for the
North American economy.
“Again, putting the dis-
cussion into the context of
feel good versus bottom
line: the companies that
don’t realize that energy
retrofitting, becoming lean-
er and producing less waste
meansanimprovedbottom-
line performance are going
to be devastated down the
road.” •
Nina Winham (nina@new-
climate.ca) is principal of
New Climate Strategies,
helping clients build value
through sustainability and
communications strategy.
She writes regularly on sus-
tainabilitytopics.www.new-
climate.ca
“There’s been a lack of
understanding in the
business community of
just how much increased
profitability can be
realized through simple
energy savings”
– Bryan Slusarchuk,
CEO,
Greenscape Capital
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