An increasing number of consumers and householders indicate a desire to buy Green Power. Many utilities now provide specific tariffs allowing for just such a choice when it comes to the power delivered to our homes.
But for sophisticated green consumers who want to take this one step further and match the money they spend to products that are made using renewable energy, a pioneering product label - WindMade - is about to be launched.
What is WindMade?
The WindMade label will be managed through a non-profit organisation, dedicated to “accelerating the adoption of renewable energy by improving corporations' ability to communicate their wind energy investments to their stakeholders”. In other words WindMade hopes to increase transparency when it comes to Corporations investing in wind energy. While at the same time empowering consumers to choose companies that make a real contribution to delivering wind energy.
WindMade founding partners
- Global Wind Energy Council;
- United Nations Global Compact;
- The LEGO Group;
- Vestas Wind Systems;
“It is a certification, like Fairtrade”, begins Morten Albaek, senior vice president at Vestas: “The exact standard and definition for this certification is currently being developed by a technical expert group - involving PricewaterhouseCoopers and the WWF among others, and a public consultation process is now open to other corporations, CEOs, NGOs, and citizen groups to allow them to also have their say about labelling standards for wind-produced products”.
In principle though, to get the label added to its products, companies will need to undergo a certification process that verifies its wind energy procurement. The results of the consultation and the details of how exactly this certification process will work are set to be announced around the time of Global Wind Day (June 15). Following on from that the WindMade consortium hopes to attract “leading consumer brands” as members.
As well as being a means of verifying that a company is investing in wind energy to produce its products, Albaek also hopes that WindMade could include a longer-term goal for companies wishing to set targets for the amount of future electricity consumption generated from wind power within the value chain. A ranking for global corporate renewable energy procurement is planned, which will track information about major Corporations' use of renewable energy.
Additionally, a WindMade foundation is on the horizon, which proposes to offer Corporations the opportunity to increase wind energy access in emerging markets - where it is most needed.
The pioneers of WindMade include organisations like the Global Wind Energy Council (GWEC), The LEGO Group and Bloomberg (which will be the main data provider). So how did Vestas get involved?
“We do business with other corporations, but don't have direct access to consumers and citizens. We wanted to innovate something that could push the wind power agenda within B2C corporations, and therefore give consumers a way of demanding more wind energy,” Albaek says. This type of innovation is unique in an industry that is well versed in innovating its supply chain and products to target the cost of wind-derived power, but has found it more challenging to engage with consumers in the face of anti-wind lobbying (NIMBY).
“There has been a lot of technology innovation in the business of wind or in other renewable sectors, but the innovation inside the area of business – the non-technology business development such as marketing - has been non-existent,” he continues. “It's an extremely conservative, predictable industry in that matter”. WindMade on the other hand is a new type of holistic innovation helping the industry in terms of PR, marketing, business development, as well as sustainability. “This is the kind of innovation that the industry needs to provide much more of, moving ahead,” believes Albaek.
But this type of program isn't cheap, so who is footing the bill, especially bearing in mind the financial restraint being shown the world over?
|WindMade…is a new type of holistic innovation helping the industry in terms of PR, marketing, business development, as well as with the issue of sustainability.
In fact, Albaek explains that Vestas itself has sponsored the establishment of the organisation for the first three years: “We have said that we would donate approximately one million US dollars, every year for the coming years. We pioneered this initiative, and rather than choose to sponsor a soccer team, we chose to sponsor an NGO which is all about consumer activation. And we think this is a little bit more intelligent”, he joked.
And was this something that had the backing of Ditlev Engel, Vestas CEO: “These are not costs – these are investments, for the future,” Engel told us during an interview at this year's World Future Energy Summit (WFES) in Abu Dhabi. “We live in a world with Twitter, and people have an opinion about everything. But actually, when it comes to choosing products that are comparing climate change, they don't have a choice”.
Engel also believes that WindMade will ultimately be good for business: “This is not about sacrificing profits for the sake of the planet. B2C businesses can see that they can actually make more business by attracting consumers that want to exercise their right to choose products made from renewable energy.”
This is an interesting point, and highlights a conundrum which WindMade could help to solve. While many companies have already made bold statements about their commitment to renewable energy, consumers have to date had no way of verifying the source of the energy used:
“When someone goes down to the supermarket, they are blindfolded and don't know whether they are picking a carrot which is oil-made, gas-made or wind-made,” Engel says. “But very soon they will at least know whether something is wind-made or not. WindMade will offer them the transparency they require for making an informed choice.”
Offering consumers this transparency is only going to work if they want it, however, and Albaek is keen to talk of the research that Vestas undertook to test this hypothesis.
“We hired Gallup to conduct a global consumer study of 25,000 people from 20 countries including India, China, Brazil, the U.S., as well as the more mature renewable energy economies in Europe,” he explains. The results showed that 76% were in favour of some kind of consumer label showing the energy used in making products. Also promising was the fact that more than 50% of respondents indicated that they were willing to pay a premium. In fact, says Albaek, “26% said they were willing to pay more than a 5% premium for WindMade products”.
Especially interesting, Albaek adds, is that the support for increased consumer transparency was highest in India and China. Why is this? “Perhaps it's for two reasons,” he speculates. “Firstly, the number of consumer labels that are out there is fewer than Germany or the U.S. for example. And secondly, perhaps the climate crisis is a lot more real for millions of middle class consumers in India and China”.
So how will the process be monitored, especially in countries, cities and towns that lie off the beaten track in developing countries?
“The NGO – WindMade – is an independent legal entity which has one sole purpose: ensuring that the certification process for WindMade is as lean, efficient, and transparent as possible. To sustain the certification, a company must report on its energy useage annually, if it wants to be re-approved and certified to use the WindMade label”.
Could companies be able to cheat the system though? “Possibly, but then I think the consumers will find out, and those brands will be burdened by that,” Albaek concludes.
David Hopwood is Editor of Renewable Energy Focus magazine.
Renewable Energy Focus, Volume 12, Issue 2, March-April 2011, Pages 8-9