Business now pushing governments on sustainability

Agribusinesses, energy providers and clean-tech companies are among the industry players pushing today’s sustainability agenda, according to panellists speaking on the final day of the Business for the Environment Summit (B4E) in Jakarta.

Business leaders described how they were proactively bringing solutions to governments in an effort to speed up the transformation to a sustainable, low-carbon economy.

Last year, Indonesian energy provider Star Energy joined other members of the newly formed Association for Low Carbon Business in Indonesia, ALBI, in developing better finance policies for Indonesia’s Ministry of Energy. The goal was to help the government find more manageable and cost effective ways to meet its target of reducing greenhouse gas emissions by 20 per cent.

Indonesia committed to the 20 per cent target at the UN climate change talks in Copenhagen in 2009. Recently, it increased this commitment, in its domestic policy, to 26 per cent.

Bret Mattes, chief executive officer of Star Energy, said, “We looked at all the options for the government and presented those that would be easiest to do.”

The easiest alternative turned out to be greenhouse gas emissions abatement in energy production. “With emissions from energy growing twice as fast as GDP, we showed how hydro and geothermal could help the Ministry meet the targets set by the President,” he explained.

Mr Mattes said energy abatement is easily achievable – and for Indonesia it’s relatively cheap. The cost to everyone involved is only about $20 per tonne or 15 per cent of the current annual fuel subsidy each year. It’s all very achievable.

“But it needs to be implemented soon,” he added.

Urgency and accelerating change was a common theme for the experts on the panel.

Coordination and collaboration are the key to accelerating change in China, said Peggy Liu, who chairs the Joint US China Collaboration on Clean Energy (JUCCCE), a Shanghai-based non-profit group that facilitates the application of clean technologies in China.

“Especially in China, as long as you know who holds the seat of power and how you can provide them with practical solutions, then change can happen on a very large scale,” she added.

By targeting supportive decision makers, JUCCCE was able to bring larger groups on board, and they generated momentum by choosing projects that would deliver results within three years. “We wanted the most practical and easy to visualise projects to generate a multiplier effect,” said Ms Liu.

One project was the Shanghai Expo reuse scheme. Last year’s Shanghai Expo had 80 pavilions that would be redundant after just a few months. “We went around and convinced the pavilion operators to donate their materials, and we built a secondary school with it. It’s a project with a very compelling image – the school – and you celebrate everybody’s contribution,” she explained. It convinced the Chinese government to reuse materials on other projects.

Other industries are working with governments on improving governance and regulatory inconsistencies.

Indonesia’s palm oil industry, long criticised for causing massive deforestation, is now collaborating with the government on setting clear policies and regulations that they say will level the playing field and improve forest management.

President director of Indonesian palm oil grower PT Smart, Daud Dharsono said the biggest obstacle to meeting sustainability expectations was dealing with inconsistent laws and regulations.

“There has to be a common understanding of sustainable practices. There has to be support from the government, but we also need support from the key players in the industry. The key is we have to do it together. With all stakeholders we can clear up legal misunderstandings and reach common agreement on appropriate land use,” he said.

He said industries were still experiencing governance and regulatory hindrances, especially the palm oil industry. “But these could be overcome with greater collaboration,” he added.

Eco-Business.com’s coverage of the B4E Global Summit 2011 is brought to you by City Developments Ltd (CDL).

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