Views

Bridging the Clean-Tech Developing-World Divide

Ron Pernick

The late Donella Meadows, a great environmental scientist, educator, and visionary, was one of a number of people to help put into context the state (and plight) of the modern world. She came up with an exercise that asked "what would the world look like if it were a village of 100 people." Her work on this concept is continued today by the folks at the Miniature Earth Project.

The results are eye opening. According to the Miniature Earth web site, 74 people would come from Asia and Africa, while just 8 would come from North America. 30 people would live without electricity, 16 would have inadequate access to potable water, and 13 would be hungry or suffer from malnutrition. Equally staggering, more than half of the population would live on less than US $2 per day.

The last data point raises a serious conundrum for global clean-tech development — and highlights the severity of the challenge. How do companies, governments, communities, and others fund and deploy clean-tech development when so much of the world's population doesn't have the money to buy necessary products and services? This disparity represents one of the great divides, or chasms, of our time.

In our book, The Clean Tech Revolution, Clint Wilder and I write about a number of folks who are attempting to address the issue by deploying clean-tech funds to invest in clean-energy and water solutions in the developing world. The roster includes nothing less than two former presidents of the world's superpowers.

Here's what we wrote in the book:

The World Bank estimates that two-thirds of the increase in world energy demand through 2030 will come from the developing world. It will cost trillions of dollars to build out infrastructure and provide for the needs of the 2 billion people without access to electricity and the 1.2 billion people without easy access to potable water. To solve this serious resource inequity, we believe in the need for development funds to focus on building clean energy and water sources in the developing world.

The Clinton Global Initiative, the foundation headed by former U.S. President Bill Clinton, is working to raise funds from major donors to tackle such pressing issues as climate change, global poverty, and ethnic and religious conflict. Since 2005, Clinton has garnered hundreds of commitments valued at more than $8 billion. Among the commitments are pledges for solar, wind, and biofuels developments by non profits, governments, and corporations.

Another former president, ex-Soviet head Mikhail Gorbachev, is now head of Green Cross International, a global non-profit environmental organization. Gorbachev and his organization have called for the creation of a $50 billion Global Solar Fund over 10 years. The fund, according to Green Cross, could be raised by cutting subsidies for fossil fuels like oil and coal. The money would fund the installation of solar photovoltaic equipment around the planet, thereby driving down the price of PV, and creating a mass market for a clean-energy technology.

In early 2006, the U.K. finance minister Gordon Brown [Note: Mr. Brown became Prime Minister in June 2007, after the release of our book] called for rich nations to spend $20 billion to help finance developing nations' clean-energy projects. Others, such as award-winning journalist and author Ross Gelbspan have proposed even larger commitments. Gelbspan has called on the creation of a $300 billion clean-energy fund for developing countries through a tax on international currency transactions."

It's not only big visions that are in the works; many people and organizations are already actively funding clean tech in the developing world and working to deal with the capital constraint issues of people who earn less than $2 per day.

The Grameen Bank has developed microloans for installing solar panels in Bangladesh. The Acumen Fund, a non-profit global venture fund, is investing in technologies and solutions for those at the base of the pyramid. The Lemelson Foundation is funding a range of projects, including the efforts of E+Co, a global nonprofit investment company focused on renewable-energy development. And companies such as WaterHealth International and SELCO have been working on models to deploy water and solar systems, respectively, in the developing world. The list goes on and on.

Innovative technologies, policies, and business models will be required to address the needs of the developing world. It won't be easy, but crossing this chasm must become one of the great callings of our time. And fortunately many folks are already beginning to heed the call.

At the 2007 Clinton Global Initiative annual meeting, which Clint Wilder attended last month in New York, such clean-tech commitments in the developing world were at center stage. Among the most impressive: E+Co’s commitment of $210 million over five years for local businesses to deliver clean energy to 17 million people in Africa, Asia, and Latin America; and British financial giant Standard Chartered Bank’s staggering $8 to $10 billion over five years to fund projects in wind, hydro, geothermal, solar, and biomass energy in Africa, Asia, and the Middle East.

As Ted Turner said recently at Solar Power 2007, the annual gathering of the solar power industry in Long Beach, California (and I paraphrase): "We should drop solar panels instead of bombs on other countries if we want to make more friends."

Now that's an original idea — and one that I hope gains some traction!

--------------------
Ron Pernick is cofounder and principal of Clean Edge, Inc. and coauthor of The Clean Tech Revolution.