interviews
Becoming Prosumers Of Energy
by Ruth Santiago
February 16, 2019
This interview with Ruth Santiago, a lawyer who works with community and environmental groups in southeastern Puerto Rico, was conducted and condensed by frank news.
How do you think of energy democracy?
Energy democracy stems from the effects of energy coloniality and how certain jurisdictions have been used for extractive and exploitative practices and have become sacrifice zones for operations that create great wealth for other people over time.
How did you get involved in this work?
I got involved because of proximity. We have this saying in one of the groups I work with that says, "The environment unites us and identifies us." Not just the subtropical dry forest, and mangrove forest, and salt flats, and offshore cays, but also things that impact that environment – they also unite us and define us.
I was raised to a certain extent in Salinas. I spent my formative, adolescent years here. I was born in the South Bronx, my parents were part of the return migration to Southeastern Puerto Rico. They were from a municipality that's a little bit further east of Salinas, but very similar in many ways in terms of being part of the sugarcane monoculture, a high concentration of Afro descendent people, and real situations of struggle and survival. They decided to return to Puerto Rico when I was 12. I was raised along this Southeastern coast on and off from that time. One of my memories of growing up here as an adolescent was the Aguirre Power Complex being built in the early 70s. It was something that came to us. We did not come to the nuisances. Nuisance was built where we are.
The government of Puerto Rico tried Operation Bootstrap. Rapid industrialization and a very intense industrialization program that affected Guayama with industry coming in. First, light manufacturing and then the petrochemical industry. Then, pharmaceuticals, which are still very present. These energy plants were meant to serve more than the communities. These big, central station, fossil fuel plants were meant to provide energy to those heavy industrial uses that consumed and required a lot of energy.
What we saw in two places in Southern Puerto Rico, one here in Salinas and the other over in Guayanilla in Southwestern Puerto Rico, was how the power plants were set up very close to the petrochemical industries. We had the Phillips Puerto Rico Core Petro Refinery. Aguirre Power Complex was basically in service to that and other heavy industrial users. People were told they would get jobs. They said, "Oh, we're going to generate upwards of 2,000 jobs." People were a little skeptical and concerned about how that would impact the possibility of safe fishing at least. They were told it would not be impacted. Ultimately, what happened was Phillips did not generate anything close to 2,000 jobs and folded after a few decades, but did leave a terrible legacy of contamination to air, water, and land. People lost a lot of their ability to do the subsistence fishing even.
Aguirre Power Complex came in stages. They had two power plants in one. In 1972, they set up what was known as the Thermoelectric Plant. Again, people were told they’d get jobs from this. Again, the plant does not hire many local residents. It’s estimated there was 20-25% local hires, and the rest came from all over, anywhere but Salinas and Guayama. The same thing with the Combined Cycle units, because as I said, it's two plants in one.
At the dawn of the 20th century Puerto Rico got its first coal-burning power plant and the only coal-burning power plant that was established by AES. They're a Delaware corporation with their headquarters in Arlington, Virginia, but they do business all over the world. In November 2002, they started a brand-new, so called clean-coal power plant. It's been disastrous. Again, people were told, this is going to be beneficial in terms of stimulating the local economy and bringing down the electric rates. None of that happened. What has happened is that people are getting more and more exposed to pollutants and heavy metals and public health is being impacted.
Your work seems two-fold. One is dedicated to producing energy that is actually clean and that will not leave a legacy of toxicity. The other is in trying to invert the power structure of how that energy is produced and sold. Correct?
Absolutely. Absolutely.
Can you talk about your work in both areas and how they come together?
We have done a lot of resistance work, and a lot of work to promote community alternatives on energy and sustainability issues. There's a long history of activism here. I became more active in energy issues around 2003. We started participating in the monitoring of the Aguirre Power Complex and how it impacts public health, air quality, and water. Both the sea water and the potable water. The only source of potable water here is the South Coast Aquifer. That was monitoring.
We started participating in different administrative proceedings with a group called Comite Dialogo Ambiental, the Environmental Dialogue Committee. Then we participated in proceedings against PREPA, the Puerto Rico Electric Power Authority, but also the AES Corporation.
I've done both administrative proceedings and litigation in courts related to different impacts from those plants, and most recently a company called Excelerate Energy out of Texas was proposing to build what they call an offshore gas port and a marine natural gas pipeline, that we just defeated. It would have been running right through the middle of Jobos Bay National Estuarine Research Reserve and impacted corals and seagrass beds and offshore cays and all kinds of things, and the ability of people to do subsistence fishing and ecotourism and otherwise just use and be in the environment.
We've done a huge amount of work with respect to the coal combustion residuals or coal ash waste related to the AES Power Plant. The coal ash waste is a concentration of heavy metals, toxic heavy metals that were being spread all over, and is now being accumulated at the AES Power Plant site in Guayama, Puerto Rico.
That summarizes the energy resistance work that we've done. In terms of going beyond resistance and seeking to build the solutions and the alternatives, we've done a lot of environmental education, both with Comite Dialogo Ambiental Inc. and another group, an umbrella organization called, Eco Development Initiative.
Prior to the hurricane in conjunction with IDEBAJO and a community board called Junta Comunitaria del Poblado Coqui, in Salinas, we helped start what is known as the Coqui Solar project. It's a community solar initiative. It was started with lots of workshops and consultation and collaboration with professors, like Efrain O’Neill from the University of Puerto Rico at Mayagüez, which is the technical campus here.
It was, for years, before the hurricane, quite a struggle to get people to understand, to want to move towards solar energy, especially rooftop solar communities. It was going very slow. We were certainly doing the education work and the policy work, but not getting very far on the ground in terms of actual implementation of the first steps, the pilot project for the solar community. But right after the hurricane when it became clear to, I think, everyone in Puerto Rico and probably anyone familiar with Puerto Rico that the current electric grid does not work for the people of Puerto Rico. People have been much more receptive to the Coqui Solar project and initiatives of solar communities and other alternatives to central station, fossil fuel generation.
Can you tell me how a solar community works?
That's something that's being developed right now. The way people in Coqui Solar envision it is people who have the appropriate rooftops, usually cement, which is not the case for everyone, are able to come together to think about and work on generating energy using PV systems on their rooftops. It's certainly much more than just everyone in the community having PV equipment. This is beyond just a technological solution. It's about the social agreements necessary to make that energy and that technology serve community needs in the most efficient way.
Are you seeing a lot of progress in new ways of approaching energy? From the community, but also from a municipal government level?
That's really hard to answer. Certainly with the mind set and attitudes. There's much more receptiveness to the things that we've been talking about for years about solar communities. That has definitely changed and there's a lot more interest and it's a very dynamic situation with respect to energy. After the hurricane, honestly, people realized we're basically on our own here and the government, local, federal, municipal, comes to help us. We have to figure out these solutions.
We're seeing a lot more on the formal scale. A group called ACONER, the Association of Renewable Energy Consultants and Contractors, say they're doing five to six times the number of installations they were prior to the hurricane.
Things have definitely changed. We don't know exactly how much.
There is what can be called, lip service. A lot of lip service about renewable energy which is dangerous, especially with the government of Puerto Rico. They're saying they're adopting the 100% renewable energy goal for 2050, and I think 50% by 2040, but their actions are promoting lots of natural and fracked gas. It's a tricky situation in that sense because you hear everyone saying we adopt renewable energy, but not only are they putting the money elsewhere, they're also talking about a kind of renewable energy that's not community-based,.
What we're seeing is that the government is being pushed by every energy company you can imagine. It seems everyone has an interest in doing some kind of project here, including at utility scale. That it is not the same as the kind of alternatives we're talking about in terms of solar communities.
Why is this an urgent issue for you right now?
We saw here in Puerto Rico, that it's a matter of life or death. People need to take this into their own hands, energy by and for the people. Become more than just passive consumers but actual producers of energy and control their means of production.
We knew before the hurricanes, and we experienced it afterwards. This huge and deadly hurricane was compounded by this terrible electric infrastructure system. It's not serving the people of Puerto Rico in a real way. Maybe that was the best we could do at some point, but that's no longer the situation here and we an opportunity to do things differently. To do better. Much better.
interviews
Impact Investment For The Circular Economy
by Rob Kaplan
January 31, 2019
Rob Kaplan is Founder and CEO of Circulate Capital, an impact-focused investment management firm dedicated to financing innovation, companies, and infrastructure that prevent the flow of plastic waste into the world's ocean while advancing the circular economy.
How do you define a circular economy?
I think a circular economy is one where commodities and resources are managed in perpetuity. So that there is no waste, but instead it's a resource for future innovation and product manufacturing.
In transitioning from a linear system to a circular one – who becomes responsible for the end of life? Especially in a time where goods are globally dispersed.
Well, I think the answer is that everybody's responsible. There's no single entity that is responsible for how it's managed at the end of its life, in my opinion. That's why this is a systems challenge that requires a systems solution.
Part of the challenge you're noting is the aspiration of a circular economy with the reality of where waste exists today. Because, circular economy in many ways is an aspirational concept. Especially within consumable products. It doesn't really exist. As we look to invest in companies that can prevent plastic pollution and instead drive towards more circular opportunities, it is a matter of degree. It's not, we'll get there tomorrow in that perfect ideal. It's more about, we've got a lot of waste that's not being managed appropriately. How do we improve that in a way that can create value for those communities? And also prevent the pollution at the same time.
What do some of those solutions look like in practice for you and the companies you work with?
We've been looking at how to invest in South and Southeast Asia for the last couple years. I'd say most of the opportunity that’s "shovel ready" today is in the waste and recycling sector. They are usually startup recycling companies that are generally the first line of formality. Where they're buying materials from waste pickers as well as municipalities in some cases. And then adding some kind of value to it. We also see a number of recycling facilities. They're a little bit further downstream from the collection aggregation. We have started to see a little bit of reusable and returnable systems, but they're in a very early stage at this time.
When you work with a large multi-national company, such as PepsiCo or Coca-Cola, what does their commitment to this process look like?
They have two different levels of commitment. The first is they are committing to improve their own operations and supply chains. Almost all of our investors have direct commitments about what they're doing to increase the amount of recycled materials they use in packaging and design for recyclability. Then, they are also committing capital to our strategy to allow us to invest in companies that can increase the amount of recycled material available for their use and the use of others.
They are also providing expertise and resources, and network. They are providing essential off-take and the ability to buy the material after it's collected and sorted. That's a big part of the challenge. The market that's available to buy this material. Needing that kind of surety of off-take.
We’ve discussed circular economies from a variety of perspectives and backgrounds. Science, academia, advocacy. You approach it as a business. Why is your work a necessary part of the puzzle?
The particular slice of the problem we are looking at is plastic pollution in Southeast Asia. We quickly realized it was going to take many billions of dollars of capital to build the infrastructure required to really stop the flow of plastic leaking into the environment and the ocean. We started to look at where would that capital come from? And we realized that it's not going to come from necessarily consumers or companies, but really, institutional investors that are financing the future of infrastructure in Asia. The only way to get those folks involved in this space is to show them that it's an investable marketplace. That there is a track record. That there is a pipeline of opportunity. And that you can make money doing this. We want to demonstrate that investing in waste recycling is as boring as investing in roads and bridges, for which there is a lot of capital allocated.
Our approach to this was “How do you turn this from a waste stream and a cost center into a profit center as a way to unlock that capital?”
When you say infrastructure, are you talking landfills, incinerators? What is that infrastructure?
Our focus is certainly on the recycling and reuse side. I think there is a reality that they need to have improved landfills in Southeast Asia too. But we're not particularly able or interested in financing landfills and incinerators are out of our scope.
Has the China recycling ban affected your day to day?
Oh yeah. I mean National Sword basically turned the entire recycling industry upside down globally. In the markets that we're particularly focused on, they were exporting waste to China too. They hadn't invested in their own domestic processing. That has caused big problems for them and has created great opportunities for investors, who are trying to build those companies within those countries, under those infrastructure projects.
I think most of the countries we're working in in Southeast Asia have also started to follow China's lead and stop accepting imported waste. The US and Europe are not contributing as much to ocean plastic these days as we used to. Because the exporting markets have dried up.
I think there's probably a shifting in the future where more of that will go to Africa, right? Because they haven't started those bans. But most of Southeast Asia has already either halted imports or is talking about halting imports.
Does all of this help move the agenda of circular economies further?
Absolutely. It was so cheap. No one had any incentive to invest in domestic circular economy opportunities because if you were in Los Angeles it was cheaper to ship a container of waste to China than it was to Chicago.
That's crazy.
One important point that I've been trying to communicate lately is that there is no silver bullet for these solutions. It's incredibly complex. People really look for elegant, simplified solutions. But a circular economy is complex. We're not going to be able to reduce our way out of this problem just like we're not going to be able to recycle our way out of this problem. You need both and many more solutions. I worry about absolutists that are trying to push agendas rather than really trying to drive environmental progress.
Our approach is very much, how do we deploy capital as much and as quickly as possible to stop this pollution and make triple bottom line in the process of doing it? Rather than, you know, any political perspective or point of view, it's really just the view of the investor that we're looking to bring to the conversation.
All or nothing doesn’t work here.
Yeah. It's really complex. How can anyone say that there's a single solution to something? If it were that easy, we would have figured it out already. And I think we're also starting to see, because of the topic getting so hot and everyone wanting a piece of it, they're all saying, “Well, what's my contribution?"
Right.
My contribution is activism. My contribution is lobbying or my contribution is X, Y, and Z. And so they're all sort of piling on without a really clear theory of change about where they think they're trying to drive the progress.
Has the re-upping of investment from petrochemical companies into the production of plastic affected your work?
Yeah. One of the interesting things about plastics and circular economies is you actually want that feed stock, right? If you start removing feed stock opportunities, like PET plastic, which is what most beverage bottles are made of, for example, that's really problematic from a circular economy and recycling perspective because PET is the most recyclable plastic that we have today. You'd want to see more of that recyclable material out there. Right now it's cheaper to make plastic out of petroleum or natural gas in the US. It could be cheap to make it out of old plastics. That's where I think the big unlock towards the circular economy comes in. How do you tap into those market forces of building massive chemical facilities and use that as your off take for recyclables? That's the opportunity to change the game and that's your supply and your demand.
Are you optimistic that that will start happening?
I think the petrochemical industry is starting to show that they're really interested in that idea. I think it's really complex and hard to do. There's a lot of barriers. But it's not a technology barrier necessarily.
Is it a political barrier?
It's not so much a political barrier, I think but... Why do you think it's a political barrier?
Because of the political and financial incentive to produce and frack natural gas. How do you switch where incentive lies?
Yeah. I think you're right there. Policy is a huge part of that. Especially in the US where natural gas is so cheap thanks to policy incentives and new technology. It's not so much the same thing in some of these emerging markets we're working in, which is where energy is very expensive and most of that additional capacity is coming online.