Seeking Two Kinds of Green: Richard Branson’s Venture into Biofuels “Where others see disaster,…

Seeking Two Kinds of Green: Richard Branson’s Venture into Biofuels “Where others see disaster,…

Seeking Two Kinds of Green: Richard Branson’s Venture into Biofuels
“Where others see disaster, Richard Branson sees opportunity. The founder of Virgin Group has business interests on six continents, including airlines, express trains, and limousine services, so his company’s contribution to global warming worries him. But instead of wringing his hands, Branson sees a new fortune to be made in reinventing the fuel business, much the way he’s made over air travel, credit cards, health care, and more. He’s investing in conventional ideas like ethanol plants and solar power, but he’s also developing a formula for a new ultraclean fuel that can power his jets as well as cars and trucks.” Branson used to be skeptical that global warming posed signifi cant problems for the planet, so why the sudden interest in greenery? Branson says that “he has belatedly woken up to the dangers of global warming and is concerned the climate is near a ‘tipping point’ where small increases in greenhouse gases can lead to big changes in temperatures.” His change of heart and belief came during a 2006 meeting with Al Gore, the former American vicepresident who received a Nobel Prize for his advocacy on behalf of global warming. Al Gore’s visit stimulated Branson to think about the threats that global warming posed for the planet and humanity. In contemplating the implications of global warming, Branson admits to reading a lot of books, including James Lovelock’s Gaia and Tim Flannery’s The Weather Makers, and meeting with other people who were passionate about effectively confronting global warming issues. Branson says, “In the end, I realized the world has a serious problem, and if we carry on putting too much carbon and methane into the earth’s atmosphere, we’re going to snuff out the people and all the world’s species.” After this enlightening experience, Branson says, “Now I’m absolutely convinced that the world is spiraling out of control. CO2 is like a bushfi re that gets bigger and bigger every year. All of us who are in a position to do something about it must do something about it. Because Virgin is involved with planes and trains, we have even more responsibility. So we’ve put aside quite a lot of money to invest in alternative fuels. Over the next four years, we’ll invest something like $1 billion in alternative fuels.” Then in September 2006, at Bill Clinton’s annual Global Initiative meeting in New York City, Branson announced an even greater commitment to addressing global warming problems. He announced that over the next 10 years he would dedicate all profits from his transportation businesses to developing renewable, sustainable alternatives to carbon fuels. The pledge, estimated at $3 billion, is the largest monetary commitment yet made in the fight against global warming. In announcing the pledge, Branson stated, “We have to limit our dependence on fossil fuels. We hope that this contribution will help in some small way to enable our children to enjoy this beautiful world.” Branson also said, “The idea is to try to take it out of the transportation businesses to send a message out, that if you are in the coal or airline or car business, it is important that we balance our [environmental] books.” Branson has pledged that if Virgin’s transportation businesses fail to generate enough profi t to satisfy the $3 billion commitment, he would likely fund any shortfall with profi ts from his cell phone, health club, or other businesses. In February 2007 Branson went even further with his growing commitment to addressing the challenges of global warming. He announced the Virgin Earth Challenge, a prize of “$25 million to anyone who helps impede climate change without seriously disrupting our way of life.” Biofuels and Virgin Airways: An Experiment in Environmental Green or Monetary Greed? Although aviation contributes less than 3% of all greenhouse gas emissions, “scientists have concerns that pollutants dropped directly into high altitudes may be more dangerous than those released on the ground.” This, in conjunction with an increasing number of governments worldwide that are imposing environmental taxes on airlines, makes the search for cleanerburning jet fuels important for aviation. In response, Branson initiated a new business venture in mid-2006 to build ethanol plants and develop a new green product called Virgin Fuel. According to Branson, Virgin Fuel would be an alternative to corn-based ethanol and “could prove to work in cars within a year and even commercial jet engines within fi ve years.” Virgin Fuel (cellulosic ethanol) would be derived “from cheap and abundant sources like prairie grass, agricultural waste, and the rubbish you chuck out from your home. It’s essentially emissions-free.” In mid-January 2008, Richard Branson’s Virgin Atlantic Airways Ltd. announced that it would fly one of its Boeing 747s from London Heathrow to Amsterdam in February 2008—10 months earlier than planned—using a “blended mix of biofuel and kerosene, with at least 25% coming from the alternative fuel.” Then on Sunday, February 24, 2008, Virgin Atlantic flew the test fl ight from London to Amsterdam “with one of the four engines burning a mixture of 80% jet fuel and 20% oil from naturally grown plants.” Biofuel does not burn cleaner than kerosene-based jet fuel but biofuel proponents maintain that producing it is less harmful to the environment. The Virgin Airways test was conducted in collaboration with Boeing, the aircraft’s manufacturer; General Electric, the maker of the aircraft’s engines; and Imperium Renewables of Seattle, the producer of the biofuel mixture. Both Boeing and GE asserted that the biofuel being tested did not necessitate any modification in jet engines, which is “crucial to airline adoption since financially ailing airlines are unlikely to make major voluntary investments just to reduce emissions.” Imperium maintains that, with its technology, jet biofuel could be produced from almost any renewable crop. Interestingly, the substance that might hold the most promise for jet biofuel is algae—or pond scum. “Sewage-treatment plants offer an ample source, and algae-produced fuel would not use up food crops like corn, soybeans or even coconuts.” Which Kind of Green Do Biofuels Represent? The utility of biofuels made from crops like corn has been questioned because of the impact on global food prices, damage to farmland, and the pollution that is created in producing the crops. Two environmental lobbying groups, Greenpeace and Friends of the Earth, have warned that biofuels may be less eco-friendly than they seem. In January 2008, the Royal Society, Britain’s national science academy, published a report which concluded that some biofuels may cause more climate change than gasoline— due to carbon emissions from fertilizers and processing. In short, the report asserts that if governmental “targets encourage people to use the wrong sort of fuel, transport may get dirtier, not cleaner.” Moreover, “on a warming planet, land is an incredibly precious commodity, and every acre used to generate fuel is an acre that can’t be used to generate the food needed to feed us or the carbon storage needed to save us.” Biofuels can be highly beneficial if they don’t use arable agricultural land, and as long as fuel crops, such as switch grass, are grown on degraded lands that cannot support food crops or cattle. Branson maintains that Virgin Fuel is completely sustainable, both environmentally and socially, and that it does not compete with food and fresh water resources. He underscores the likelihood that, in the future, aviation biofuel would most likely be produced from algae. Even though Virgin Fuel is intended to be environmentally and socially friendly, Branson emphasizes that the alternative fuels venture is also about business profitability and success. He emphatically says, “It’s not just that we thought we should do this to try to save the world and the thousands of species that could die if we don’t do it. Unless you can generate cash, it’s not going to be successful. With oil prices above $70 a barrel, people want to save on the cost of fuel, and so alternative fuels suddenly make business sense.” Cynics point out that his hankering for greener planes and fuels might be aimed at reaping government subsidies for biofuels and heading off further regulation of transport emissions.
Questions for Discussion
1. Do you believe that the production of biofuels is a viable solution for addressing both the world’s energy needs and global warming? Why or why not?
2. Does Richard Branson’s approach to tackling global warming issues provide a model that should be emulated? Explain your answer.
3. Clearly, Richard Branson believes that addressing global warming can also be a profitable business venture. In your opinion, must business profitability and success be coupled with solutions to global warming, or can global warming be solved without the constraints imposed by business profitability?