The transition to a low-carbon economy requires financially attractive solutions to be made available to both industry and investors.
by Troy Wiseman
This opinion piece was originally featured in G7 Climate Change. It is reposted here with the permission of the author. Read the original here.
17 June 2014| While carbon markets were designed to incentivize the development of cleaner technologies and climate change mitigation practices, they have proven to be inefficient and in the most part, a failed attempt. With more than a decade lost, and given the near time horizon associated with increasing levels of atmospheric carbon dioxide, short and medium term solutions are required in conjunction with the longer term transition away from fossil fuels.
Within the forestry and land use sector in particular, allowing a free market to prevail would force innovation and investment, and to happen fast. Why? Because whether the cause is actual scarcity of standing forests, or the increasingly stringent protection measures these forests are being contained within, the simple fact remains; the planet is becoming resource-scarce.
EcoPlanet Bamboo was conceptualized in 2010 and developed to provide a supply of sustainably produced alternative fiber to industries and multinational institutions that consume vast volumes of the world’s ever decreasing supply of timber. In the climate change context, bamboo plantations can reduce emissions from deforestation and negative land use change through providing an alternative solution to increasing demand for fiber, while providing emission removal benefits through active sequestration and long term storage. Where the majority of forestry schemes rely on multilateral financing, these plantations provide economic diversification for rural communities living subsistence livelihoods, as highlighted by the BBC’s Radio 4 program on EcoPlanet Bamboo’s success in Nicaragua.
Companies like IKEA, Kimberly Clark and Costco, the biggest direct or indirect purchasers of raw timber globally, are already feeling the supply crunch and the pressure of increasingly environmentally aware consumers. As a result, many such companies are committed to finding sustainable solutions.
Many of these companies have moved away from a model of vertical integration, to focus on what they are good at – manufacturing and marketing a range of product that provides consumers with consistency and standardization. These multinational Fortune 500 companies no longer wish to own forests, or be responsible for on the ground management of a resource that is often produced in countries with unfamiliar policies, regulations and business environments. However what they all have in common is a desire to source a long-term secure supply of a fiber that can be substituted into current manufacturing regimes, while maintaining the consistency of quality required to ensure the absolute standardization of their products across a global context.
EcoPlanet Bamboo’s commitment is to co-develop existing products with bamboo as a preferential fiber in conjunction with large timber based clients, followed by the production of dedicated and environmentally certified raw resource plantations in strategically located regions. This model, and its ability to be implemented on marginal land is increasingly becoming a way for multinational companies to secure a long term supply of fiber, with a partner who understands that the only way to change the world is through collaboration and transparency. Within this model, bamboo as a viable alternative fiber looks to be on the tipping point of industrialization.
Bamboo’s advantages are multi-dimensional but focus around the grass’s ability to produce far greater volumes of fiber per unit area, even when grown on degraded land. Furthermore, the fiber produced can be substituted in a diverse range of products such as paper, plywood / MDF board, textiles and bioenergy with relatively little changing of current manufacturing facilities, and without compromising on quality, or product appeal.
To effectively address the drivers of deforestation we must be able to both provide the market with a cost effective alternative supply of fiber and provide a solution for the regeneration of areas already affected to prevent further advances into remaining forests.
Yet it is essential for any new product to be price competitive, and not dependent on fluctuating environmental markets or government subsidies. In this, bamboo is key. The plant’s ability to be harvested within 5 - 7 years followed by annual production overcomes many of the barriers associated with traditional forestry – long term returns on investment, illiquid assets, and a single lump payback. EcoPlanet Bamboo’s model has proven that the company’s returns can not only compete with traditional returns on investment, therefore making them attractive to even die hard non climate change believers and capitalists, but actively quantify and monitor associated social and environmental co-benefits.
However, the key to the industrialization of bamboo as an environmentally positive solution is limiting its production to land that does not compete with food production, or result in the further clearance of native ecosystems. Land such as the 150 million degraded hectares that the 2011 Bonn Challenge has pledged to restore by 2020. The governments of the United States, Costa Rica, El Salvador and Rwanda, to name a few, have committed more than 1 million hectares of land to be restored to forest cover. Yet previous programs show that success rates of tree reforestation remain relatively low. In contrast, the conversion of such marginalized land into commercial bamboo plantations addresses multiple issues: (1) a tangible timeframe for a return on the high capital requirements of any reforestation programs, (2) stimulation of rural economies through job creation and associated enterprises of low level processing and (3) provision of raw and semi processed fiber to timber manufacturing entities therefore reducing pressure on the remaining forests of these very countries.
Yet bamboo is not a silver bullet. Any crop, particularly one that offers the diversity of 1,400 species, requires rigorous scientific understanding, testing and millions of dollars in investment in order to be produced in a commercially viable manner, and within frameworks that meet the most stringent of sustainability standards. EcoPlanet Bamboo has invested heavily to overcome these barriers and subsequently offer bamboo as a superior alternative fiber to a range of industry partners.
About the Author
Troy Wiseman is CEO of EcoPlanet Bamboo, which he co-found built on a dual dedication to provide the marketplace with a sustainable business solution to global demand for fiber and forest products, while providing marginalized people with the potential to change their own lives in areas of the world where few opportunities exist.
Mr. Wiseman is a successful entrepreneur, whose legacy includes founding and leading two global companies, B.U.M clothing and InvestLinc Group, as well as founding World Orphans through his philanthropic endeavors, funding 500 orphanages in 19 countries.