the new global energy economy
TRANSCRIPT
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A REPORT BY HARVARD BUSINESS REVIEW ANALYTIC SERVICES
The New Global Energy Economy:Toward a New Future
Sponsored by
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Copyright 2012 Harvard Business School Publishing. All rights reserved.
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THE NEED TO TRANSFORM THE GLOBAL energy supply chain to ensure a more sustainable uture is one
o the dening challenges o our times. The problem is stark: scientists estimate the scale o the climate
change is such that, by 2050, the world must reduce global carbon emissions by 10 billion15 billion tons
per year below business-as-usual levels. To achieve this, nonossil uel energy technology would have to
displace one billion tons o emissions on average each year.
To meet this challenge as demand or energy surges, a new global energy economy is needed. Not only
must we nd new ways to create energy eciencies, but we also must create a new energy mix o clean
and renewable energy sources such as hydraulic, wind, biomass, and solar energy. In addition, we mustmake major changes in our distribution inrastructure as well as international regulatory policies.
The complexities, costs, and political issues involved in making these global shits in energy technology,
investment, and policy have stood in the way o turning the promise o sustainable energy into reality.
Debate continues over who will lead the way. For instance, in a 2011 global survey on the uture o energy, a
majority o readers surveyed by Harvard Business Review Analytic Services elt that growing environmen-
tal impact and rising costs o energy demanded changes in energy supply and inrastructure. A majority o
respondents also said the problems were too big or business to tackle: government had to take the lead in
supplying tax incentives, research dollars, and new regulatory policies.
But the way orward, outlined here in a series o articles by energy experts and edited by Harvard Business
Review Analytic Services, may in act be a collaborative eort in which government, business, and civilsociety together explore the best solutions or pushing the global economy to a lower-carbon uture.
Author Andrew Winston describes how businesses can step orward in energy innovation by recalibrat-
ing return on investment (ROI) so that it measures a broader range o value, including intangible value
generated by investments in sustainable energy. He lays out the case or a corporate portolio approach to
investing in green energy. He also shows how corporations such as Microsot have moved to price carbon
internally, so that managers who choose to use carbon-based power or their actories or transportation
will be charged more or their energy. The ee, he posits, will encourage greener choices, just as govern-
ment-enorced carbon pricing plans propose to do.
Executive Summary
A exible and positive approach can yieldresults i it ocuses on solutions that are
scientifcally sound, economically rational,
and politically pragmatic.
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Within my organization, energy costs are increasingly
affecting distribution of products
In my personal life, energy costs have become a
greater concern
Environmental issues in general have become
increasingly important to me
I consider security of national energy supplies to be
an issue of global importance
My organization offers little follow-through in implementing
more efficient energy practices
In my opinion, my organization is not doing enough
to explore energy options
ithin my organization, compliance with energy-related regulatoryissues has become increasingly important
Within my organization, energy costs have grown
increasingly important
35%54%
36%51%
41%32%
36%19%
25%17%
24%13%
12% 22%
11% 19% Strongly agree
Agree
Attitudes toward energy issues
QUESTION: Please indicate the extent to which you agree with each of the following statements about energy supply and demand.
(All agreeing with statement)
I believe a new energy distribution infrastructure needs to
be developed over the next decade
The existing energy distribution infrastructure should be
adapted to incorporate alternative energy sources
I do not think the energy distribution infrastructure needs
to be modified to support alternative energy sources
Dont know
No answer
3%
56%36%
3%2%
Infrastructure adaptation views
QUESTION: To what degree, if any, do you think your country should adapt its existing infrastructure to deliver energy from alternative
sources?
Source: 2011 Harvard Business Review Analytic Services global reader survey of 1,748 business executives.
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In another piece, Jigar Shah, ormer head o the Carbon War Room, argues that technology innovation is
not standing in the way o reducing the carbon ootprint: in act, he says that there are hundreds o tech-nologies that have met the technical milestones to protably oset high-priced oil and coal. Yet although
most have been deployed to a small degree, they are still waiting to be discovered and have their market
potential realized. The answer? Linking deployment o clean energy to economic development. Focusing
use o these newer clean technologies in underserved rural areas, as well as emerging nations, he argues,
would create powerul eciencies in energy use, capital investments, and end costs to the consumer.
And nally, Aime Christensen, Special Adviser to the UN Secretary-Generals High-level Group on Sus-
tainable Energy or All, lays out the case or clear, predictable energy policies that benet both businesses
and national and international interests. As energy availability and policy are critically important to the
health, wealth, and security o all, it is time or business and governments to work together to create the
policies that build a better uture. The asymmetry o power and resources between more developed and
less developed nations is a deep challenge, she says, but urther underscores the need or a collaboratively
created policy regulatory design.
As leaders gather at Rio+20, it is clear that the issues around climate are complex. The solutions will
require innovative policy changes, new paradigms in thinking and investing in energy, and creative nego-
tiating among a wide range o stakeholders. But as the Harvard Projects on International Climate Agree-
ments recently concluded, a fexible and positive approach can yield results i it ocuses on solutions that
are scientically sound, economically rational, and politically pragmatic. The world can aord no less.
Support for government role in innovation
QUESTION: What is your view of the role of government in energy innovation and development?
69%
54%
51%
10%
13%
My government should provide tax incentives and research
funding to encourage innovation of sustainable energy.
My government should provide additional tax incentives and
increase regulation of traditional, non-sustainable energy use
to encourage alternative energy innovation.
Intellectual property derived from publicly funded energy innovation
should be available to all on a licensing basis.
My government should take control of key energy
production and distribution.
Government should not be involved in energy
development and innovation.
Source: 2011 Harvard Business Review Analytic Services global reader survey of 1,748 business executives.
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Andrew Winston is a globally recognized expert and speaker on green business
and advises leading companies on profting rom environmental thinking. He is the
author oGreen Recovery and the coauthor o the best sellerGreen to Gold.
Private-Sector Investment in SustainableEnergy: Fixing ROI
Energy innovation presents business leaders with a dilemma: They know they
need to reduce carbon emissions and use more sustainable sources o energy. But
they cant always justiy the level o investment needed to make renewables a
truly signicant portion o their energy use.
The dilemma, however, is not unresolvable. What i businesses ound a way to more nely calibrate return
on investment (ROI) so that it measures a broader range o value, including intangible value generated by
investments in sustainable energy?
ROI has utility, no doubt. The problem is that most companies use ROI as a blunt tool, limiting its ability to
measure a ull spectrum o value and leaving strategic opportunities on the table. In order or compa-
nies to take on the challenge o sustainable energy and capture its benets, they must take a new approach
to how they think about and measure value.
THE INTANGIBLE VALUE THAT ROI DOESNT CAPTURE
In many businesses, ROI and its close cousin, internal rate o return (IRR), have migrated rom being useul
decision-making aids to being mental straitjackets. Companies set absolute hurdle rates, with inputs
and outputs measured solely in actual cash fows. Just those projects that meet a set standard go orward.
In the process, these organizations miss out on making strategic investments that would still pay back in
traditional terms even i it takes a bit longer but yield much more value than just whats immediately
measurable in cash.
Investments in renewable energy are a perect example. Keep in mind that buying renewable energy does
pay o, but it may take longer than a typical companys two-year hurdle rate. So were not talking aboutbad investments, but ones that oten suer by comparison only because the total value to the enterprise is
not normally calculated.
For example, using renewable energy in operations reduces reliance on volatilely priced uels, which in
turn reduces risk and that has value. And it makes planning easier; you know your variable costs on
energy will be about zero, which is a very nice number.
Andrew Winston
Author, Green Recoveryand
coauthor, Green to Gold
FULL REPORT
Andrew Winston
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Whats more, companies can realize signicant value by demonstrating to consumers, employees, business
customers, and other stakeholders that theyre keeping costs and carbon use low. Increasing customer and
employee loyalty is very valuable.
For their part, consumers are increasingly showing a preerence or companies that are maximizing the
good they do. In the 2012 Edelman goodpurpose report, which surveyed 8,000 people in sixteen markets,
more than 70% o consumers said they would recommend, promote, and switch to brands doing good
things. This number is up twenty percentage points in just our years.
For employees, working or a company that demonstrates a commitment both to the ideal o corporate
responsibility and to smarter ways o operating is increasingly critical. In PwCs millennials at work survey,
nearly 90% o those surveyed most o whom were individuals born in the 1980s and 1990s said they
would choose employers with corporate social responsibility values that match their own. In the global
war or talent, companies that are doing the right thing attract the best and brightest.
Beyond appealing to consumers and pleasing employees, a commitment to sustainable energy and low-
carbon operations can help drive sales with corporate customers. An increasing number o companies
want to reduce carbon emissions throughout their value chains, and as a result theyre demanding more
o their suppliers. A majority o companies in the Carbon Disclosure Projects supply chain group global
heavy hitters with ar-reaching supply chains that include Sony, Carreour, Nestl, HP, Pepsi, Johnson &
Johnson, and Unilever have said that they will assess potential suppliers on carbon perormance.
Reducing risk and building your brand with consumers, employees, and corporate customers may be con-
sidered intangible value, but that just means the benets are hard to measure. The value is no less real.
NEW WAYS TO THINK ABOUT AND APPLY ROI
So how can companies make strategic decisions about sustainable energy investments that take hard-to-
measure value into account? Here are ve approaches:
1. TAKE A PORTFOLIO APPROACH TO INVESTING IN GREEN ENERGY. An apparel company I worked
with wanted to retrot two distribution centers, but it aced a tough choice. One lighting retrot easily met
the companys three-year hurdle rate, but the other did not. So the company combined the two eorts into
In order or companies to take on the challengeo sustainable energy and capture its benefts,
they must take a new approach to how they think
about and measure value.
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one project that, in total, did meet the hurdle rate. I call this mental trick pairing, and some companies go
urther and combine dozens o projects into a single investment portolio.
The cleaning products company Diversey established two hurdles or projects in its carbon reduction plan,
a three-year payback and a cost per megaton o carbon avoided. Out o 120 possible projects ranging rom
lighting retrots to solar photovoltaic systems, only thirty met both hurdles, but many met at least one. An
expanded ninety-project portolio, in total, met the double hurdle, and it included renewables that were
unlikely to meet both hurdles on their own. Diversey was able to increase its carbon reduction goal rom
8% to 25% rom 2003 levels and generate a higher net present value.
2. SET ASIDE DEDICATED FUNDS FOR SUSTAINABLE ENERGY INVESTMENTS. DuPont and building
materials company Owens-Corning set aside a portion o their capital expenditures budgets just to und
energy-eciency initiatives. A ew companies are using a similar approach or sustainable energy invest-
ments. Consumer products and pharma giant Johnson & Johnson has created an internal carbon reductionund o about $40 million per year. Managers apply or money to invest both in eciency projects and in
renewables.
3. CHANGE THE ROI OR HURDLE RATE OFFICIALLY. For capital investments, Unilever requires an envi-
ronmental prole, which may trigger a lower hurdle rate. Industrial giant 3M will oten slash the hurdle
rate or pollution-prevention projects rom 30% to 10%. One o my clients, a large consumer products
company, recently lowered the required IRR or renewable energy investments that generate tax benets,
rom the standard 12% to 8%.
These commitments will pay o over time. A decade ago, Swedish urniture retailer IKEA started allowing
ten- to teen-year paybacks on solar investments (the paybacks are much shorter now). The company now
produces more than 150 gigawatt-hours o renewable energy, about 12% o the electricity needed to powerits stores and distribution centers.
4. CHANGE THE ROI OR HURDLE RATE STRATEGICALLY. I companies dont categorically change the
hurdle rate as IKEA and Unilever did, they can do so inormally. Walmart, a amously rugal company, has
purchased renewable energy or 75% o its stores in Caliornia. Fred Bedore, Walmarts senior director o
business strategy and sustainability, says o Walmart executives approach to investments in green power:
There is an ROI calculation on all sustainability investments, as there is on all projects, but we look at
where the investment gets us. The longer-term payback on solar helps us get to scale down the road.
In essence, Bedore is saying that Walmart knows it can help the solar market scale up, thus lowering its
uture costs, all while reaping the immediate variable cost benets o ree power. In short, Walmart has
tweaked its ROI requirements or green power initiatives to refect a broader sense o value.
5. PRICE CARBON INTERNALLY. Microsot recently announced a novel program: It will charge a ee to its
100-plus global oces and data centers or every ton o carbon they produce, mostly rom plugging into
the electric grid, so-called indirect emissions. The company will use the unds, about $10 million over the
next scal year, to buy renewable energy certicates (RECs) and carbon osets.
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A ew other companies, in particular BP and Shell, have tried internal carbon trading in the past, but those
were shadow prices, not actual ees. Microsot is collecting real money rom each oce. As Rob Ber-nard, Microsots chie environmental strategist, says, I you run one o our oces, and you choose to use
carbon-based power, well charge you more or your energy. The ee will, in theory, move managers to
make greener choices.
HUMANITY-SCALE VALUE
The ve methods described above are or driving increased direct investment in renewables within
the private sector. But a majority o current investments have happened through an entirely dierent
model in which companies spend no money up ront. They sign power purchase agreements (PPAs)
with another company that generates renewable power on-site. The contracts speciy that they buy the
power at a rate comparable to that o grid-based energy. In regions with the right incentives and policies
in place, this model has been very successul. About 75% o commercial solar installations around the
world are under PPAs.
But there are solid reasons that companies may want to own their own generation and employ my ve ROI-
shiting tools. Microsot and many major tech companies, or example, are providing cloud-based services
and need huge amounts o reliable power. They may be more comortable owning that capacity.
And the act is that well need more o all o it more PPAs and more direct purchases o renewables.
We need to transition to a low-carbon economy much aster i we have any hope o avoiding the worst o
climate change. Companies need to change their investment models to take into account value thats hard
to measure but no less real.
Sustainable energy pays o in many ways. It saves money over time, and it helps save our planet, our
economy, and perhaps our species. Its time or corporate investment models to refect that humanity-
scale value.
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Jigar Shah is CEO o Jigar Shah Consulting and a Carbon War Room board
member. As an entrepreneur and visionary committed to the new Impact Econ-
omy, in 2003 he ounded SunEdison, creating a multibillion-dollar solar services
industry. From 2009 to March 2012, he was the Carbon War Rooms frst CEO.
What Will It Take to Turn the Promise ofSustainable Energy into Reality?
The 1973 Arab oil embargo and the 1979 oil crisis inspired massive investments in
alternative energy technology. As a result, today we have hundreds o technolo-
gies that have met the technical milestones to protably oset high-priced oil
and coal. Yet although most have been deployed to a small degree, they are still waiting to be discovered
and have their market potential realized.
Mobile phone penetration has expanded exponentially in the past ten years, but many users have only spo-
radic access to electricity. In the emerging world, there are more than 543 million mobile phone users who
lack electricity at home. These consumers spend the equivalent o $5/kWh to charge their phones using
diesel-based electricity about orty times what we pay or electricity in the United States.
In both cases, the technology and the market opportunity exist. The question is, Why are proven technolo-
gies underutilized?
Similar technological breakthroughs have occurred in other sectors, including transportation and agricul-
ture, but here lets ocus on electricity, specically three areas:
Rural electrication Renewable electricity expansion Ecient electricity use in the emerging world
Each presents a cumulative trillion-dollar opportunity through 2020 waiting or deployment. For reer-
ence, Bloomberg New Energy Finance reported more than $150 billion in clean electricity deployment in
2011, $93 billion or solar energy alone. Not insignicant by any means, yet much opportunity remains
untapped i we link deployment o new energy technology with economic development.
RURAL ELECTRIFICATION
Traditionally, rural electrication is achieved through government expenditures or guarantees to expand
grid inrastructure to every part o a country. The higher-density areas are more protable than low-
density areas, but to spread costs out across the network, everyone is charged roughly the same amount
or electricity.
Jigar Shah
Jigar Shah
CEO, Jigar Shah Consulting
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Today the cost o extending the grid to rural areas is much more expensive, given the rise in commodity
prices such as copper so high that the densely populated areas with electricity are unwilling to subsidize
rural areas. Given these circumstances, governments and institutions are araid to spend the money, ear-
ing that expected GDP rises rom rural electrication will not materialize, making such investments a big
political risk. As a result, we continue to have more than 1.6 billion people without home access to electric-
ity and even more with unreliable grid connections.
RENEWABLE ELECTRICITY EXPANSION
Yet technological solutions to this problem exist. Solar lanterns and solar home systems provide individual
household power at a raction o the cost o stringing power lines. The money already expended or mobile
phone charging and kerosene lighting provides a stable base o demand that is protable without govern-
ment subsidies; such demand is usually not included in demand modeling or clean energy. Typically,
there is some government support or these solutions, but it is oten used to give away ree product insteado catalyzing private-sector investment. Further, the advent o mobile billing can reduce transaction costs
substantially, eliminating a costly line item in the payback o distributed units.
Take what Luma Light is doing in Sierra Leone. For $1,000, an entrepreneur is provided a central solar
charging station with ty desk lamps with rechargeable batteries. The entrepreneur charges the lights
during the day and then rents out the lights or US$0.80/week a 50% savings versus weekly kerosene
expenses. When the batteries run out, the lamps are returned to be recharged and available to be rented
out again. Over the our-year lie o the lamps, the total revenue is $8,000 more than enough to pay back
the initial $1,000 with interest, create a salary or the entrepreneur, and pay or warranty claims and thet.
On the grid side, many countries have electricity inrastructure or high-density populations. The preerred
electricity-generation sources are large dams in Brazil, coal plants in South Arica, and nuclear plants in
India all dicult to build today or social and nancial reasons. Each country is in the awkward position
o having paid or the distribution grids but not generating enough electricity at centralized power genera-
tion sources to provide 24-hour-a-day electricity to consumers. These countries and many more are turn-
ing to distributed, rather than centralized, energy generation. Distributed generation technologies, such
as those based on solar and biomass, are leaprog technologies and do not require connection to the grid.
Solar generation, or example, can happen on the roo o a building.
Much opportunity remains untapped i welink deployment o new energy technology
with economic development.
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In both South Arica and India, there is a eed-in tari program or distributed solar power plants that can
eed into existing distribution grids. Both programs were started recently and are expected to attract morethan $1 billion to each country in private-sector investment in 2012.
Seeing this example, Brazil has recently conrmed that it, too, will be launching such a program in the
coming months. Even countries such as Tanzania realize that the diesel and heavy uel oil generation they
rely on today can be more cost-eectively met by solar, biomass, wind, and other renewable energy tech-
nology.
But there is more work to do. In Tanzania, a new 667-kilometer high-voltage transmission line is being
built by TANESCO between the Iringa and Shinyanga regions or more than $450 million beore any new
power generation is built. For the same price, orty regions in Tanzania could install a local 10 MW biomass
acility, creating more than 100,000 agriculture and engineering jobs.
EFFICIENT ELECTRICITY USE IN THE EMERGING WORLD
Finally, many countries are starting to acknowledge that they will simply not be able to bring electric-
ity supply online ast enough to meet the growing electricity needs o their people. They recognize that
upgrading their existing industrial acilities so as to optimize use o electricity is a must. In many parts o
the emerging world, industrial and mining electricity usage exceeds all other uses. Eciency would ree up
capacity to sell to others.
For example, in Tanzania requent power blackouts have slowed the countrys economic growth rate to
6.5% in the ourth quarter o 2011, rom 6.7% a year earlier. The countrys National Bureau o Statistics
(NBS) reported that electricity output declined 1.7% in 2011, whereas it grew 9.7% in the prior year. Plus,
low water levels reduced hydroelectric production and maintenance work aecting gas-ueled power gen-
eration. The NBS says the countrys electricity crisis caused growth in the manuacturing sector to decline
to 6.6% rom 9.9% a year earlier (although this was partially oset by growth in the mining sector, which
rose to 1.2% in 2011 rom negative 9.1% in 2010, aided by an increase in gold production and higher pre-
cious metal prices worldwide).
Identiying the opportunities is not hard. Implementing them is. Why? Because most industrial users do
not have the visibility into their businesss energy needs to invest in energy-eciency upgrades even i
the investments make nancial sense.
As a result, companies deault to the electric utility company making the investments and simply charg-
ing them a xed payment on their bill to recoup that investment. Yet the electric utilities are pushing back,
claiming that they are solely in the business o supplying electricity. They have a hard time expanding their
role to include managing both electricity supply and demand. We have a world that does not have a handle
on the demand side o the energy equation. As a result, energy is not managed.
For example, a utility is not incentivized to help a customer become more energy ecient and more
competitive through better energy management, despite the act that doing so would strengthen the local
economy and create more broad-based demand or electricity rom consumers, especially where energy is
scarce, as it is in Tanzania. In inrastructure, win-wins are rarely enough incentive to move orward. There
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Aime Christensen is CEO, Christensen Global Strategies, advising clients includ-
ing the Clinton Global Initiative, Microsot, the United Nations, Duke Energy, and
Virgin Unite. She has two decades experience in policy, law, and business strategy,
including at Google.org, Baker & McKenzie, The World Bank, and the U.S. Depart-
ment o Energy. She is the 2011 Hillary Laureate and a 2010 Aspen Catto Fellow.
Can Business and Government Collaborate
to Design a Better Energy Future?Access to clean, ecient energy underpins the prosperity, security, health, and
quality o lie o everyone on the planet. Yet too many live without access to
modern energy services, too much energy is wasted, and too many suer rom the health, environmental,
and security harms o unsustainable energy.
It is predicted that by 2030, population growth and increased energy needs per capita will require approxi-
mately double our current energy capacity and an investment o $16 trillion to $25 trillion in order to get
there. But what type o energy investments will be made to meet that level o need, and what will their
economic, equity, and environmental consequences be?
Driving these investment decisions will be technology costs and resource availability, both o which are
shaped by the incentives that policy rameworks and other governmental interventions establish ordont. It is in businesss direct interest to infuence those policies, and the best way to do so is to jettison
the old model o business lobbying government rom aar and instead employ a collaborative model in
which government, business, and civil society together seek the best solutions.
ENERGY, BUSINESS, AND THE ROLE OF GOVERNMENT
Energy is a material cost to many businesses and one that can undermine a businesss economic competi-
tiveness. Whats more, energy oten largely determines a businesss environmental impact. For businesses
operating in or selling into emerging markets, energy can be an enabler o market growth and opportunity
by helping to bring people out o poverty, or it can be a source o unrest and insecurity when communities
around extractive industries, or instance, do not have access to energy, including or ood and water in
times o crisis. What energy a business uses and rom what sources are decisions shaped by policy as well
as by investor input and public opinion.
To a greater extent than ever beore, global investments are made by private parties, whereas the govern-
ments key role is to establish the policy and regulatory rameworks to guide those dollars: to determine to
what extent investments generate economic benet, protect the environment, and increase global equity.
Governments also can expend their capital in ways that unleash private capital that would otherwise not
fow, including reducing political and borrower risk by providing guarantees and by capacity building.
Aime Christensen
Aime Christensen
CEO, Christensen Global Strategies
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Germany, or instance, provided policy and regulatory incentives to make solar investment attractive.
It established a set tari or independent solar electricity providers to sell into the grid, thereby making
investments in solar predictable. As a result, the country now has nearly as much solar-based electricity
generation capacity as the rest o the world combined. Renewable energy now meets 20% o the countrys
needs, and most o it is generated not by large projects but by distributed small systems, such as solar
panels on homes, wind turbines on arms, and biogas plants that process arm waste.
Texas has 10,000 MW o wind energy installed, twice as much as any other state in the United States. While
Texas has a large and well-distributed wind resource, the rapid growth in the production o wind energy is
due primarily to state action: the passage and then expansion o the states Renewable Portolio Standard,
the use o Competitive Renewable Energy Zones, expedited transmission construction, and Public Utility
Commission rulemaking. These measures were developed with strong industry, civil society, and expert
group input.
Last summer, the state grid credited the wind industry or helping avoid blackouts during the record-
breaking heat wave and drought, with wind generating ar more electricity than expected, and unlike coal
and other orms o generation that depend on cooling towers, wind power does not need access to water to
run. It is expected Texass wind power capacity will be up to 12,000 MW by 2014.
INTERNATIONAL EFFORTS
A new global program launched by UN Secretary-General Ban Ki-moon is setting an innovative course in
addressing our energy challenges. Sustainable Energy or All has three goals by 2030:
To ensure universal energy access To double the share o renewable energy in the global energy mix To double the rate o improvement o energy eciency
Each o these goals will benet global business, enabling development, reducing the security and environ-
mental impacts o our energy systems, and increasing the competitiveness o businesses and economies.
In addition, each is a business opportunity in its own right.
In September 2011, the UN General Assembly agreed 2012 would be the International Year o Sustain-
able Energy or All, endorsing these objectives. Since then, the Secretary-Generals High-level Group on
Sustainable Energy or All including representatives o the UN Industrial Development Organization,
Clear, predictable energy policies not onlybeneft businesses, but they also serve national
and international interests.
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As an energy company, we understand that we have a central role to play in the search or sustainable
development. We recognize that responding to complex challenges requires multiple measures. There isno silver bullet. The world needs to increase the eciency o its energy production and invest in an energy
mix in which clean and renewable sources such as hydraulic, wind, biomass, and solar are predominant.
We are already doing this, and we know it is easible.
For us at CPFL Energia, it is a pleasure to support this Harvard Business Review Analytic Services white
paper. We do not have all the answers, but we do believe that through dialogue and through increasing
knowledge and awareness, we can build the world that we all desire and need.
Wilson Ferreira, Jr.
President
CPFL Energia
ABOUT CPFLThe CPFL Energia Group is one o the principal players in
the Brazilian electricity sector. In 2011, CPFL Energias
installed capacity was 2,644 MW, generating gross revenue
o R$18,866 million. In the same year, CPFL Renovveis was
constituted to ocus on renewable energy projects. For more
inormation on the company and its sustainability strategy,
visit www.cpf.com.br.
www.cpf.com.br
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