January 17, 2011

Global Energy Basel

By Bradley Schroeder

There are two ways to evaluate a conference. First is by the number of attendees; the amount of mindless masses you can get into a room who are answering emails or Skypeing with friends instead of paying attention to the guy who probably just finished his presentation 5 minutes before the session. This is evaluation by scale. The second way is to have a smaller group of high level officials from the public and private sector listening intently in various languages to the best in the industry give presentations that they are not only passionate about but also have decades of experience on the subject matter. This is evaluation by content.

The First Sustainable Infrastructure Financing Summit, held in Basel, Switzerland was of the second lot. The participants are from the C40 which represents 8% of the population and 20% of the worlds GDP. When you scrolled through the 250 or so participant’s names and titles you see some of the most prominent people in institutions from the public, for-profit and non-profit sectors represented. Opened by the mayor of Basel, Guy Morin, the conference was focused on financing sustainable infrastructure projects using long-term solutions (many of which span time-frames longer than a politician will be in office) compared to short-term fixes.

The opening sessions discussed sustainable infrastructure that was aestically appealing. Barbara Kux, a board member of Siemens, stressed the need to look at cost efficiency over the entire lifespan. Examples given were utilizing bio-mimicry (technology that mimics natural processes) and having solar powered car parks. One asks right away – how are we going to pay for that? Gina Domanig from Emerald Technology Ventures discussed the venture capital world in the US, compared it to Europe (which is overregulated, stifling innovation) and then gave Israel as a case study. A decade ago, Israel had almost no VC and now is at the forefront globally. Christopher Frei from the World Energy Forum backed up Ms. Domanig’s statement by confirming that unlike the 90’s, currently there is a scarcity of capital, not a scarcity of resources. He pointed to a quote from a prominent member of KPMG who said that “85% of financing is coming from the private sector.” This was a call to government officials in the audience to invest in long-term sustainable solutions.

As with many conferences there were always 2 breakout sessions happening simultaneously that would be interesting to attend. I waivered but ended up in ‘The Role of Carbon and Climate Finance in Sustainable Infrastructure Development’. Focusing on the future of the carbon market post Kyoto’s expiration in 2012, David Lunsford from IETA spoke of the successes of the market to date, the reason for stagnation as of lately – a mixture of the economic slowdown and the uncertainty of the market in the future.

This was followed by Adrian Rimmer, CEO of the Gold Standard Foundation, who complimented Mr. Lunsford’s presentation and outlook as well as discussed what a project needed to become have a gold standard and the benefits of having a gold standard project. Both David and Adrian were extremely well informed on the subject matter and gave very insightful predictions about the future.
This overview of the CDM market was followed by practical case studies. There was success in the incineration of trash into methane in San Paulo which provided clean energy for 700k people. There was also frustration in Cape Town as the money earned through a gold standard low income housing project was used in maintenance of the house compared to being reinvested growing the initial idea or into future CDM mechanisms.

But the whole reason I attended this conference was to moderate a session on ‘Funding Public Bicycle Sharing Infrastructure.’ I couldn’t have asked for a better panel to moderate. I was competent in the subject matter and the four speakers all had unique and interesting presentations that complimented each other and created a wonder flow to the session. The charismatic Kulveer Ranger, advisor to the mayor of London, set the stage with a great ‘big picture’ presentation of how to and what a bicycle sharing system can mean to a city, “create an icon.” Following Mr. Ranger was Christian Haeuselmann who discussed how bicycle sharing can solve the ‘last mile’ problem found in conventional public transport. He also spoke about integration, “don’t just invest in bicycle sharing, invest in new mobility thinking.” His various examples of possible integration were very innovative and practical.

It was now time to get to practical examples. Steve Gutmann from the Portland Sustainability Institute outlined the capital and operating expenses involved in a bicycle sharing system and some fundamental challenges Portland faced in finding the initial capital. He discussed various funding mechanisms they had explored and the advantages and disadvantages of each. One interesting fact was that he claimed Bixi estimated it could cover half of the operating costs through its revenue mechanisms, a statement I had not heard before.

With Portland covered it was time to go halfway around the globe to China. Li Shanshan of ITDP China presented the growth and financing of public bicycle systems (as it’s termed in Chinese) in China. Mr. Ranger leaned over to me in amazement at the scale at which public bicycle is growing and the scale of the systems. Later that evening at dinner he compared their newly opened superstation in London of 150 docks to the Xinzhuang Station in Shanghai which has 1500 bicycles available. Li Shanshan went into the different financing mechanisms used in China. From completely underwritten by the private sector to completely subsidized by the government, China has a full spectrum of case studies. The session wrapped up with some interesting comments and questions from the audience.

No conference is complete without a dinner. This was a floating dinner as we dined on fondue while motoring around the Rhein River. You never know who you’re going to get sit next to at these types of things but I got lucky. I sat next to Steve’s partner from Portland and we talked bicycle sharing all night.

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