The Need for Biobased Consumer Products in the 21st Century and the Ongoing Industrial Evolution.

 Look around everything you touch is a product of fossil fuels, even the I-thing you're reading this on. The power is in our hands to combat climate change and not just at the ballot box.

-Eric Stevens founder the Centre for Industrial Evolution

The green solution shell game
The focal point of combatting climate change has centered on the need to replace fossil fuel as an energy source. Fossil fuels are apart every aspect of our everyday life. Fuel, electricity, and heat are only a small part. Products we use every day are made of fossil fuels.  In many respects they are more dangerous to our environment than the use of fossil fuels for power generation. These three fossil fuel resources are; oil, coal and natural gas. 

Experts agree the processing and use of fossil fuels have had a major effect on climate change. The debate continues as to which source is the “smoking gun” in global warming. All three have been advertised as “dirty technologies.” All three have been equated to their use in energy production with the magic solution in our struggle to combat climate change.

There appears to be a ‘shell game’ of sorts happening as corporations and government keep our attention focused on green energy, and lowering emissions. The thought of bio-based materials replacing fossil fuel products has been given little attention, even as the farm bill is making its way through the halls of Washington.

Products made of fossil fuels:
Product of fossil fuels - Chart Eric Stevens CIE

Consumer products containing fossil fuels touch every aspect of our lives. Plastic products, steel, water bottles, appliances, electronics all are produced as a bi-product of fossil fuels. From the medications you take and food you eat to your IPhone; it’s all derived from fossil fuel MATERIALS. Ironically, even the recyclable containers one painstakingly fills with paper and plastic are made with... You guessed it... fossil fuels.  

Consumer products made from fossil fuels have recurring environmental impacts.
  •  Greenhouse gases are released during the refining process,
  •  toxic secondary chemicals are combined during production of the materials,
  • those materials are processed again to make the product,
  • the product is used,
  •  Disposed of in landfills. 
The soil and sky are mercilessly punished over and over again. In 2011, industrial processes generated 4.9% of total U.S greenhouse emissions, and over 70% of the 250 million tons of municipal solid waste generated was attributed to fossil fuel based products, (source:EPA)

The U.S. dependence on fossil fuels runs deeper than our love for energy. The U.S. must turn its attention to replacing fossil fuels in the products we use with sustainable bio sources on a significant scale. A biobased products industry is critically dependent on having a large, sustainable supply of biomass at a reasonable cost and developing cost-effective and efficient processes for converting non-wood crops to lumber, cement, polymers and composites.

The U.S. Forest Service report on the strategic direction for bioenergy and biobased products 2009-2014 stated “In 2007, then-Forest Service Chief Gail Kimbell set a goal of increasing bio based products produced to 27.7 million tons using materials from America’s farms and forests.” However, this reports neglects to mention the use of ‘non-wood’ biomass in the production of biobased products.

The impressive growth we've seen in renewables is a testament to the potential for this to be a win-win. But there are still a number of roadblocks standing in the way of this becoming the success story that it could be.

Creating a viable bio industry in the United States.
The intersection of opportunity.

Gaining the attention of the public is the key to changing our economy. Most Americans do not realize the reach that the fossil fuel has in their everyday lives. When looking at indicators of the public opinion on climate change the public is clearly committed to green alternatives when citing:
  • The growth of renewables in energy: According to the latest issue of EIA's "Electric Power Monthly" with data through to June 30, 2012, non-hydro renewable sources (i.e., biomass, geothermal, solar, wind) provided 5.76% of net electrical generation for the first half of 2012. This represents an increase of 10.97% compared to the same period in 2011. Solar increased by 97.2% while wind grew 16.3%.
  • The increase in sales of hybrid and electric cars: According to the United States Department of Energy around 40,000 plug-in electric vehicles were purchased by Americans in the first six months of 2013, that’s more than double the amount sold throughout the same period last year. In 2012 there were 52,000 EVs sold, which was an increase from 17,000 in 2011.
  • Organic food sale growth: Organic food sales in the United States have increased from approximately $11 billion in 2004 to an estimated $27 billion in 2012, according to the Nutrition Business Journal.
  • Organic textiles growth: Fibre2Fashion reports that in the past several years the sales of eco-friendly textiles have seen double-digit growth and that, from 2006 to 2010, the sales of organic textiles in the United States alone has grown more than 600 percent.
  • Increase in recycling: The U.S. Environmental Protection Agency (EPA) In 2011, Americans generated about 250 million tons of trash and recycled and composted almost 87 million tons of this material, equivalent to a 34.7 percent recycling rate.

Similar growth can be forecasted in the use of biobased plastics, composites, and polymers once climate change concerns include the role fossil fuels play in consumer products. In short, the American consumer will care once the media and social networking sites start focusing the spotlight in the issue.  

The United States can be competitive in manufacturing.

The initial explosion can be sustained as the novelty of organic products begins to wane by increasing localized supply. Developing more cost efficient methods of harvest and processing leading to superior products at lower prices bridges that crucial intersection between wanting to do good, and economic sacrifice. The ‘feel good’ aspect becomes a secondary purchase motivator.

When looking at the cost of fossil fuel exploration, the Unburnable Carbon 2013: Wasted Capital and Stranded Assets report stated that $674 Billion was spent globally last year alone on the discovery of new fossil fuel deposits that will likely never be used.

Factor in its effect on the price of fuel, coupled with the fact that over 85% percent of consumer products are imported into the United States, the U.S. can be competitive. When products are domestically produced in local supply chains cost of fuel is no longer a mitigating factor.

Furthermore, take into consideration additional costs that are figured into the price of that imported product. Agents, freight, insurance, duties, are all added to the price tag. A shirt purchased for $14.00 off the rack cost the retailer you bought it from $5.67. (source: O’Rourke Group Partners LLC).

The establishment of a bio based materials industry not only makes sense, its success and effect on climate change are inevitable once the public realizes the use of fossil fuel in a majority of products, and is focused on both the environmental and financial rewards of bio based products. 

So where do we grow it?

According to a UC Merced Study by Andrew Zunker there are 111 million acres of abandoned farmland in the United States. Transforming these abandoned lands to grow multi use crops not only creates jobs, but will lower our impact on the environment by as much as 31% over the next 15 years.

Due to high productivity rates and increasing storms due to climate change, the current rate of soil degradation is alarming.  In areas hard hit by soil erosion and over harvesting, less demanding bio crops can easily be cultivated and harvested for vital soil nutrients like biochar as a bi-product of processing. Biochar can be distributed to surrounding areas reinvigorating soils.

Depending on the species of bio-crop, the bio based product industry can also turn once non farmable land into working biomass plantations.

What do we grow?

If you ask the EPA, USDA, and US Forest service judging from the amount of recent research on bio based durable goods the answer would be a resounding “I don’t know!”

As a result of the combination of ignoring climate change for the last 10 years, prohibition of industrial hemp, lack of research on biomass crops for fiber, and the imposed quarantine on bamboo plants and other biomass stock we have managed to legislate ourselves into a corner. 

The analogy of “life finding always finding a way” comes to mind in this case. In this case, that term is literal. Biomass crops are finding a way. Recent advances in propagation and cultivation methods in step with market demand make bio based goods viable.

There are three feedstocks most suited for US agriculture that will also serve a bio based product industry. This article will be followed up by features on each of the three feedstocks in the near future. For purposes of this article, I will keep it brief.
  1. Bamboo: One of the most diverse and sustainable grasses in the world, Bamboo grows quickly anywhere, has over 1500 uses to date, needs little water, and is stronger than steel. Bamboo has been given recent attention by international universities on composites and polymers. The environmental benefits are many.    For more information visit: A Bamboo Project.
  2. Hemp: Although illegal in the United States, this plant is become a political rallying cry and momentum for legalization is growing. Hemp has a similar list of uses as bamboo, is equally tolerant of growing conditions, and could replace many of the fossil fuel products on the market. For more information please visit: Hemp Industries Association
  3. Flax:  Flax comes from the blue-flowered plant crop grown mainly in the cooler states of North Dakota, South Dakota, Montana and Minnesota. In 2011, total U.S. flax production was nearly 2.8 million bushels valued at $38.6 million. The marketing year average price for flax was $13.90 per bushel in 2011. One derivative is linseed oil commonly used in paints and varnishes. Fiber panels and plastic composites are also currently being manufactured. For more information please visit: American Flax Industry Portal
The Political landscape for bio based products:

President Barack Obama’s Climate Action Plan, announced at Georgetown University in June, outlined an ambitious agenda to address the increasing dangers of climate change. While noteworthy in the overall goal to reduce energy consumption, and regulate dirty technologies in favor of renewable energies, the plan lacks in the area of a bio based products industry. As a matter of fact, there is no mention of it at all.

The Senate's bipartisan 2013 Farm Bill represents the most significant reform of American agriculture policy in decades. It also brings attention to the lack of fiscal commitment to a bio based products industry.

Some programs of note include: (source: Senate Committee on Agriculture, Nutrition and Forestry)

Biomass Research and Development Initiative (BRDI)

The bill will reauthorize funding for research on biomass feedstock development for bioenergy and biobased products. The bill provides $130 million in mandatory funding for BRDI.

R&D has fueled productivity growth over the past century, enabling U.S. farmers to do more with less. It has helped U.S. farmers to remain competitive in global commodity markets and better achieve an environmentally sustainable supply of biofuels, fiber, and feed, as well as safe, nutritious, and affordable food. Much of this growth in U.S. agricultural productivity and production was attributable to innovations enabled by investments in agricultural R&D. The public part of these investments yields benefit‐cost ratios in the range of 20:1 to 30:1—proof not only of a remarkably profitable undertaking for  U.S. public agricultural R&D, but it also spotlights the significant lack of investment vs. what is needed to achieve the 2009 US commitment to lowering GHG emissions.

Bio based products: Title IX Energy

The bill will reauthorize and modify USDA’s BioPreferred Program and the Federal Government Procurement Preference Program. Many of the modifications are adopted from the “Make it Here, Grow it Here” initiative which includes reporting of bio based purchases by the federal agencies, auditing and enforcement of the bio based and education/outreach activities. The program will receive $15 million in mandatory funding.

In summary, the United States is investing less than 145 million in funding as part of its commitment to a biobased economy. In comparison, oil, coal, and natural gas industries receive between 10 and 52 BILLION in subsidies per year. When reviewing these statistics one must conclude the U.S. government is making a token investment into this nation’s future while supporting the present model of consumption and environment destruction.

In many ways each one of us ensured this outcome. Every purchase we make is a political vote. When purchasing fossil fuel products over bio-based products, you are putting the profit in the hands of fossil fuel companies that pay for the votes and campaigns out of profits earned.

A way forward:

An immediate change cannot and will not take place. There are too many mechanisms in place to inhibit an immediate turn via adaptation of new sources and technologies. The question must be asked, “Will we enact the changes needed now or will we simply continue to diminish resources until our eventual demise drowning in the arena of public debate?”

Arguably, the needed change from a linear economy to a circular economy will be gradual and based on one single fact; profitable commerce. Profits fuel government elections, lobby for votes, and provide the needed funding for new technologies. Until the renewable business model is proven via public acceptance, consumer spending, and profitable equity, we will continue on this collision course with an extinction event. 

An evolution is upon us. A derivative of a wider human interaction via social media and the internet. Immediate social interaction is awakening the global population to the power of the consumer dollar, climate change and an understanding of how modern commerce plays a role in our everyday lives. Viral distribution of social injustices, environmental offenders, and a broken political system will enrage and empower the average citizen and cause a redistribution of wealth unseen since the turn of the last century.

The moment the average consumer wakes up to the realization that the failure of our current “system” is  directly attributed to the natural resources on which is was built is the moment things will begin to change.

Take away corporate profit, take away corporate political power. The power of the consumer dollar will echo the public opinion with greater accuracy than any poll, and in turn cause a shift in the source of campaign funds and lobbying dollars.

The Industrial Evolution theory
This is the Industrial EVOLUTION. 

The Industrial Evolution introduces a gradual shift or combination of sources both fossil and bio based. This article focuses on bringing an understanding to modern commerce and its interaction with government, highlighting a realistic, peaceful approach to change that begins and ends with the consumer dollar.

The occurrences throughout modern history are numerous. The steam powered locomotive, furniture, the stove.

However, these products went in an opposite direction. These were products in high demand designed based on what was available instead of putting forth the research to find new materials. “Build with what you have” became a mantra of capitalism in this country.

Design changes were driven by a model to lower material or manufacturing costs to produce these products. As advancements in technologies led to lower material acquisition and manufacturing costs in coal and petroleum products, profits increase driving our economies. The one problem remains with these advancements and products. The main sources facilitating these advancements have been fossil fuel based.

The driving factor behind these advancements has been profit. The need for higher valuations, larger volume, and increasing profits for the shareholders has been the primary factor in every new technology or business decision since the beginning of modern civilization.

The additional capital needed to further the development of bio based products and promotion of a bio based industry once again depends on private investment.

Obama stated on 6/25/13 “Convince those in power to reduce our carbon pollution. Push your own communities to adopt smarter practices. Invest. Divest. Remind folks there’s no contradiction between a sound environment and strong economic growth... Make yourself heard on this issue.”

The good news is three drivers exist today to finance attention on bio based products and replace fossil fuel materials. 

1. Divest/Reinvest: A new “cool” term invented by Bill McKibben and his gang has quickly grown from a handful of kids at Swarthmore to campaigns at over 300 college campuses, along with many cities, states, churches, and even pension funds. The idea is that if divestment is successful, we can strip the fossil fuel industry of its political power, and politicians will start acting in favor of prosperity instead of big coal and oil. This plays to the principle of the Industrial Evolution and is further supported by;

2. Crowdfunding: While we wait for the Securities Exchange Commission to finish writing the rules on this landmark legislation signed into law by President Obama in April 2012. The JOBS (Jumpstart Our Businesses Act of 2012 is a law intended to encourage funding of United States small businesses by easing various securities regulations and it has already begun working in spirit. 

Sites like KickstarterIndiegogoMosaic, and We Funder are facilitating the funding of private companies, and individual projects via public participation. Kickstarter and Indiegogo are publishing projects that offer every type of incentive imaginable with the exception of financial compensation. This in itself is monumental. Foreseeably, this replaces the need for focus groups, new product surveys, and shortens product development times. Why? Quite simply, the success of your campaign is the success of your product. Where projects are based on transaction, the success of the product is guaranteed and your marketing just became immediately equitable. On the marketing industry side, data accuracy pertaining to public opinion of a new product has just risen exponentially. One is no longer forecasting the success of a product, they are reporting it.

Sites like Mosaic and Wefunder are driving the equity investment side of crowd funding. These sites are preempting the business model by qualifying the demand. In other words they are saying “I’m over here! But wait for admission.” Like hysterical teenage concert goers camping out on sidewalks, the public reaction had been enthusiastic. Potential investors are waiting in line for months for the opportunity to see their start-up star and the government is taking notice.

The 1933 and 1934 U.S. Securities and Exchange Commission (SEC) laws last July 10 were revamped for the 21st Century, as the commissioners voted 4-1 to remove the ban on advertising private offerings to the general public.  The new law will be effective Monday September 23 – 60 days after publication of the final rule to the Federal Register which occurred on July 24, 2013.

While they are waiting in line, they are screened and handed special access to private placement opportunities in start-up companies like backstage passes. They're falling over each other to get in the door.

3.  Power of the purchase: As a result of the internet revolution the playing field has been evened out a bit for small and large companies alike in terms of distribution and access to market. Marketing prices via the internet are lower than traditional mediums, and consignment sites have been built to drive the traffic and subsequently profit from it. To cater to the eco conscious consumer a complicated matrix has appeared of green stamps and information labels. As in all new products, the labeling market is shaking itself out. The winners will be those that clearly communicate their green merits at the point of purchase, and not get caught lying about it. Transparency in this arena is key to build the consumer confidence.

The power of one has never been as influential as it is today with the added value of social networks. It has shown businesses consumers have the power to organize and quickly. 

Movements like 350.Org, Greenpeace and Occupy have had resounding successes in areas of boycott, consumer awareness, and political protest. The National Bank Transfer Day staged in protest of Big Banks (Bank of America). At least 650,000 customers joined credit unions between September 29th, 2011 -- the day Bank of America announced it would charge customers $5 to use their debit cards for purchases -- and the first week of November, according to a separate CUNA survey. On November 5th, 2011   credit unions reported an increase in deposits of $80 million on that ONE day. 

The same social influence will have a large effect on the success of bio based materials as a substitute for fossil fuel based products. All it takes is the realization of the U.S. Consumer that every product he/she touches is paying for big oil, coal and natural gas to continue to destroy the environment.

For industry to successfully “evolve’ certain conditions MUST be met to support the power of the consumer dollar. 

  1. A domestic manufacturing must be established and supplied by a combination of international and domestic sources until such time the domestic supply becomes self-sustaining. Calculating new growth periods of crops and market acceptance for bio based products, this period should not last more than 15 years.
  2. Development of cost efficient methods of harvesting and production. What entices the conscience must be supported by the wallet. “Giving till it hurts” will not stand for an extended duration. The prices of bio-based products must be lower than their fossil fuel competitors.
  3. Regulation of plantation developments. We cannot fall victim to the ‘cash crop rush’. Repurposing land committed to food growth will worsen our situation, by relying on imports for food supply. Today over 99% percent of our food is sourced in the United States. 

This historic intersection of opportunity can and will be successful in creating a circular economy and redistribution of wealth. All the needed elements are in play. The power is in our hands via methods never before available to the general public. Responsible, and ethical progress is the way forward, but be tolerant of the scandals and conflicting expert opinions. We must not falter in our resilience to save this planet for our children and we must remember fossil fuels created this society. It would be safe to assume, these businesses will not fail peacefully. After all, we’ve engaged in wars to protect the business model, nothing short of the commitment to peace will shift it to the right sources. Capitalism hasn’t failed, the natural resources on which it was built have failed us all. At what cost is now up to us.

Next week.. #theshift- changing the flow of consumer dollars.


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