Green Oil?

green oil

Here’s a dirty secret from the clean industry: WE LOVE HIGH OIL PRICES!

That’s right. When the rest of the world is in a panic over the rising economic and political costs of escalating oil prices, we’re thinking “expensive oil = green oil”. Why, you ask? Well…

People re-consider consumption habits. For starters, check out this great list of how many products besides gasoline utilize petroleum in their manufacturing process. High oil prices don’t just mean you pay more at the pump. Increased transportation and petroleum-based material costs contribute to price hikes for just about every commodity across the board, which  leads to inflation and the need to stretch your budget. Doing more with less means reducing waste by re-using may have previously been discarded and finding creative ways to better utilize existing resources – from paper towels to food scraps to industrial containers and packaging.

Increased costs force corporations to encourage green practices. First, take the example of grocery store chains. Disposable plastic shopping bags, which were previously a negligible Green Oilline-item chalked up as a branding platform and cost-of-doing-business, become a serious margin-eroding problem. This leads major chains to encourage re-usable shopping bag use, even selling them right at the check-out line. Sure, they want you to buy the highly profitable multi-use bags made from natural materials, but they also don’t want you taking their ‘free’ plastic bags. Now, consider the increased costs to manufacture, package and transport all the goodies on the grocery store shelves. Suppliers have pressure to increase prices charged to the grocery store chains, who push back on the consumer’s behalf because they know they can’t sell as much at higher prices, which causes the suppliers to innovate in ways that utilize more environmentally friendly materials, decrease oil consumed and smog produced during transportation and re-consider wasteful packaging.

The result is consumers utilizing re-suable bags, controlled inflation for groceries and more eco-conscious corporate practices….all because of higher oil prices!Green Oil

Governments get serious about energy efficiency and renewable energy. We all know that reliance on foreign oil is a major problem, but the issue gets cast under a microscope when gas prices spike.  All of a sudden green technology news makes the front page, social media platforms explode with green sentiment and politicians are put under intensified pressure to pass legislation encouraging subsidies for energy efficiency retrofits and renewable energy projects. Whether it’s through PACE financing, Feed-In Tariffs or any other myriad financial instrument to encourage clean technology adoption, more gets done when voters are concerned about environmental issues, which is especially important when public sentiment sadly shifts towards believing ‘global warming’ (which should really be called ‘climate change’) is a myth.

US manufacturing actually benefits (Hint: Imports get expensive): The unfortunate reality is that thGreen Oil, Commercial Energy Efficiency, Commercial Energy Solutionse US has lost its edge in manufacturing for almost every established market with low worldwide oil prices. However, rising oil prices have the potential to shift the tide back in favor of local sources and shorter distribution channels. Plus – and this is super-important – the battle for green technology manufacturing dominance is still undecided!  If American companies can keep a cost edge due to transportation costs, that’s a huge win for good old Uncle Sammie.

Energy efficiency gets is due as top priority: We’ve beat our drum to the ‘efficiency before renewables’ mantra pretty consistently over here at GreenTechBuyer, but high oil prices add a feCommercial Energy Efficiency, Residential Energy Solutionsw band members to the percussion section. As energy costs go up, suddenly technology, IT, operations and sustainability leaders are aligned in the boardroom. They all want to spend less, and oil is forcing their hand to look at current consumption habits in light of potential systems changes for lighting, HVAC and server controls. The same logic applies to homeowners looking at insulation and energy usage habits, which leads to home energy audits as the start of the process.

Timing couldn’t be better for the hybrid and electric vehicle markets: After some rough patches entering the market with geeky aesthetics, reliability concerns and high price tags, alternative fuel vehicles are ready for prime time. The Chicago Auto Show was a coming out party for the Chevy Volt and Nissan Leaf, and the Toyota’s Prius is under stiff competition from Ford’s Focus hybrid. Charging stations are finally making their woil priceay to parking garages too. Rising oil prices are a fantastic catalysts for the alternative fuel vehicle and charging station industries.

Listen, we understand that there’s no such thing as ‘green oil’, except maybe in reference to the new world of algae fuel, but high oil prices are about as green as it gets for the clean tech industry.

Forget “drill baby drill”. “INNOVATE BABY, INNOVATE!!”

Source: GreenTechBuyer

High oil prices affect the average person in almost every way.  It is not pleasant to have to pay more for less and South Africa will be facing another fuel price increase in April- petrol and diesel are approaching 2008 prices before the global economic meltdown.  The positive side, as the above article states, is that we will be forced to become more energy efficient and aware of how much energy we use.  Green technology for renewable, ‘free’ energy sources such as solar energy and wind energy is advancing rapidly and high oil prices make these alternatives more competitive.

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