Author: Charlotte Gill

Nuclear energy experiences resurgence thanks to technological breakthroughs

Posted on by Charlotte Gill

Nuclear power once promised almost limitless energy to an increasingly industrialised planet. At a time when the grime and smog from the coal and oil industries had become almost intolerable in the developed world, nuclear power proved attractive because it spewed relatively little in the way of carbon emissions into the atmosphere.

Unfortunately, a series of catastrophes severely damaged the industry’s reputation, leading many governments to turn their backs on what was seen as a costly and potentially lethal source of energy. Ever since the Chernobyl disaster in 1986, countries throughout the world have been reticent about relying on nuclear power, instead returning to fossil fuels while desperately trying to find an efficient and scalable form of renewable energy. Made unattractive by the comparatively high cost of regulation, as well as the mushroom-cloud-shaped risk, nuclear power has taken a backseat. These concerns were exacerbated in 2011 when the Fukushima disaster struck Japan.

However, the nuclear power industry might be about to enjoy a resurgence thanks to a number of technological breakthroughs. These innovations, scientists claim, will dramatically reduce both the cost and the potential risk of nuclear power reactors. But is the world ready to embrace an energy source that has done such shocking damage in the past?

Reactors under construction

30

In China

10

In Russia

6

In India

The nuclear power industry has been fraught with devastating disasters that have prevented it from becoming the ubiquitous energy source many had hoped it would be by now. In 1979, the Three Mile Island accident in Pennsylvania marked the worst nuclear accident to hit the US. Seven years later, Chernobyl would suffer by far the worst disaster in the world, causing a 19-mile exclusion zone to be formed around the site, and serious damage to be done to the health of people and livestock across Europe. It was this disaster in particular that ultimately led to the reassessment of the nuclear energy industry as a whole.

The financial cost of the nuclear industry is a particularly contentious subject, but proponents of the technology claim it is far more economically efficient than their opponents make out. While the capital costs of nuclear power stations are especially high, they require less in the way of long-term fuel and external expenses. In particular, they have a far smaller impact in terms of greenhouse gases than fossil fuel plants.

Conflicting opinions
Different countries have differing opinions on nuclear power. While France has enthusiastically embraced the technology, getting approval for new nuclear power plants in the UK has been a particularly difficult task. In Germany, Chancellor Angela Merkel announced plans to dramatically scale back the country’s reliance on nuclear power in 2011. This was in light of the Fukushima disaster, but was also a longer-term consequence of the country’s exposure to Chernobyl. Germany had already announced a nuclear phase-out in 2000, but this was sped up after Fukushima, with a new target of 2022 being announced for the total closure of all nuclear power stations. Other countries have announced similar plans over the last two decades, including Belgium, Spain, Italy and Austria. Many others have explicitly stated their opposition to nuclear power, including Israel, Norway, Greece, Malaysia and Australia.

But while the dangers of nuclear power are widely discussed, there has been a surprising shift in the thinking of many environmentalists regarding its benefits. A few have reversed their opposition to nuclear power, hailing it as a necessary tool in the bid to bring down global emissions and end humanity’s dependence on fossil fuels. This comes at a time when renewable energy sources, such as solar and wind, have yet to be successfully scaled up to meet the energy demands of the modern world. With the need to address carbon emissions targets becoming increasingly desperate, many former opponents of nuclear power are reassessing its potential advantages.

According to a study by research firm the Breakthrough Institute, the nuclear energy industry is at a crossroads. Its report How to Make Nuclear Cheap notes nuclear “supplies a substantial share of electricity in many developed economies – 19 percent in the United States, 29 percent in South Korea, 43 percent in Sweden, 82 percent in France – but these figures may decline as reactors built in the 1960s, 1970s and 1980s retire. Meanwhile, developing countries are increasingly turning to nuclear to meet rapidly growing energy demand and to reduce pollution. China is currently building 30 reactors and has plans for dozens more; 10 are under construction in Russia, six in India. Nevertheless, fossil fuels remain dominant worldwide, with coal the reigning king and natural gas production booming. The central challenge for nuclear energy, if it is to become a greater portion of the global electricity mix, is to become much cheaper.”

The institute argues rising costs within the nuclear industry have been caused by the relatively high cost of building new nuclear plants, and this is in large part due to extremely strict building, environmental and safety regulations.

Small nuclear devices
In October, US aerospace giant Lockheed Martin announced it had made a technological breakthrough that would enable nuclear reactors to be built small enough to fit on the back of a truck. The advantages of this are numerous, with cost reduction and flexibility being the most prominent. Developed at the company’s Skunk Works division over the last four years, the small reactors will potentially offer 100MW of power and will be 10 times smaller than existing reactors. It is hoped the first of these smaller reactors will be ready to use in only 10 years.

With testing being carried out over the next year and prototypes hopefully being built within five, Lockheed Martin believes it may have finally cracked an area of the industry that has eluded scientists for many years: nuclear fusion. The head of the project, Tom McGuire, told reporters he felt the work could “make a big difference on the energy front”.

If the work is successful, it will allow for compact nuclear fusion to produce far more energy than alternative sources such as coal, with considerably less waste. By using extremely dense deuterium-tritium fuel, it is thought that almost 10 million times the amount of energy of typical fossil fuels can be generated. Just one reactor would be enough to power a town of around 100,000 people.

While the compact fusion generators could be daisy-chained to create larger nuclear plants, the ‘high beta fusion reactor’ would also potentially allow for deep space exploration. They could also be built far more quickly than larger reactors, and at much lower costs than larger projects.

However, some scientists are sceptical about the potential of Lockheed’s claims. MIT Professor of Nuclear Science and Engineering Ian Hutchinson told MIT Technology Review such technology had been studied for a long time already, but had not proven successful: “Based on that, as far as I can tell, they aren’t paying attention to the basic physics of magnetic-confinement fusion energy. And so I’m highly sceptical that they have anything interesting to offer. It seems purely speculative, as if someone has drawn a cartoon and said they are going to fly to Mars with it.

“Of course we’d be delighted if a real breakthrough were possible, but when someone who shows no evidence of understanding the issues makes a bold claim that they will just make a small device and therefore it will be quicker [to develop], we say, ‘Why do they think they can do that?’ And when they have no answers, we are highly sceptical.”

McGuire has maintained that his team’s work is merely a small, positive step towards an ideal outcome, rather than a revolutionary breakthrough. He told Aviation Week in October: “We’re not promising that we have made the jump across the divide. We are being honest about where we are. We have made some steps forward, and there is still a lot of work to do, step by step in measured progress.”

Daisy chains
The UK’s former Environment Secretary, Owen Paterson, has enthusiastically supported the idea of daisy-chaining small nuclear reactors. He told the UK Government’s Climate Change Committee in October that daisy-chaining smaller reactors could power entire cities. Currently, nuclear power stations tend to take the form of huge plants that cost many billions to build. In the UK, the planned Hinkley Point plant in Somerset is set to cost around £25bn. Smaller reactors could be lumped together, and easily replaced at a lower cost.

Paterson said such projects had been successfully running in the UK for a number of decades: “Nine have been working on and off without incident and the technology is proven. Factory-built units, at the rate of one a month, could add to the capacity at a rate of 1.8GW per year.”

Responding to his speech, the committee said such reactors might have a role in the future, but there remained “large uncertainties over price and public acceptability”. Echoing these sentiments was the government’s current Energy Minister, Matt Hancock, who told reporters: “Small modular reactors have huge potential, but the technology is at an early stage. I want us to do the work to make the most of that potential.”

Greater challenges
The Breakthrough Institute stresses the nuclear power industry needs to focus on commercialisation if it is to gain the trust of the world. Choices must be flexible, and not solely focused on one form of technology over another. Its report breathlessly explains: “A broad commitment to accelerate nuclear innovation, to support multiple pathways to new nuclear technologies that are cheaper and safer, and to avoid foreclosing pathways that may ultimately prove fruitful [are] not inconsistent with the imperative to bring substantial discernment to those efforts. Indeed, clarity as to which technological pathways offer a likely route to the broad commercialisation of nuclear technologies that are substantially safer and cheaper will be necessary to ensure that limited public resources are allocated wisely and that new institutional and regulatory arrangements are well suited to support these efforts.”

The industry will certainly face greater challenges, but nuclear power clearly has the potential to wean the world off damaging fossil fuels – it just needs scientists to ensure that it is both safe and cost-efficient. And if Lockheed is right, then that day might come sooner than expected.

Davos day one and two – the talking points

Posted on by Charlotte Gill

Europe’s twin challenges
On the day that the ECB unveiled a €1.1trn QE programme, key government figures from Finland, Ireland, Latvia, Germany and the Netherlands gathered to debate how the continent could best promote economic growth and stability. “The task for Germany now is to support the European Union, but every country needs to have the courage to undertake structural reforms”, said Sigmar Gabriel, Germany’s Vice-Chancellor and Federal Minister of Economic Affairs and Energy. “Politicians fear losing elections if they undertake structural reforms, but the alternative is to prolong the crisis.”

In tech we trust
Academics and key technology industry names gathered to discuss how the digital revolution must work to gain trust before consumers feel they’ve lost control of their data. “Personalised internet is a better internet”, said Marissa Mayer, President and CEO of Yahoo. “What is clear is that users own their data and should have control of how their data is used.” In the discussion, the panellists admitted that there was a disconnect between data protection and retention, and that without better transparency and data protection laws, privacy concerns would continue to mount.

Live Earth
The opening day saw the unlikely pairing of musician Pharrell Williams and former US Vice President Al Gore announce a series of concerts to raise awareness and demand action on climate change. The event, which was given the title Live Earth: Road to Paris, aims to unite “A billion voices to deliver this single message to world leaders: Take climate action now.” Scheduled to take place on June 18, the event will be broadcast in over 190 countries and bears certain similarities with 1985’s Live Aid.

Merkel speaks up
Angela Merkel featured on the panel in a session entitled Global Responsibilities for a Digital Age and spoke at length about the freedom of democracy, the economy and the situation in Europe. “We want to remain a stable anchor in Europe”, she said. “We need jobs, and these jobs have to be created in those areas which promise long-term, highly qualified employment.” The German Chancellor also referenced the attacks in Paris on several occasions, and said on the subject: “Democracy must be our answer to terrorism.”

The new context for Japan
Shinzo Abe’s victory in December’s snap election means that his Liberal Democratic Party have enough support to follow through on his three arrows. The government in December passed a series of reforms in a bid to boost consumption and give strength to the recovery, and those on the panel insisted that they would continue to revitalise the economy is this way. Panellists agreed that a Trans-Pacific Partnership was the country’s “highest priority”, though deregulation in the healthcare, agriculture and energy sector, alongside a focus on markets outside of Tokyo and Kyoto were also highlighted as areas in need of attention.

Online learning platform Coursera shakes up the face of education

Posted on by Charlotte Gill

As you click the ‘go to class’ button on the Coursera website to begin the company’s Financial Markets module, it feels similar to the bricks-and-mortar universities it is trying to emulate. Like many freshmen attending the same class on the first day of the semester at Yale University, Coursera students are greeted by the friendly face of Robert Shiller, Professor of Economics. You are prompted to introduce yourself to your peers and encouraged to check out the grading structure for the course, before getting stuck into the first lecture on basic principles of finance and risk management.

The fact that the experience feels grounded in reality is vital. The online course is designed to simulate, to the greatest degree possible, the experience any undergraduate attending the course at the actual university would have. Appealing little touches, such as the way students are encouraged to take part in events such as ‘final office hours’ (where they can ask the lecturer concise questions regarding any aspect of the course and have them answered, in person, from Shiller’s office at Yale) set it apart from other learning sites. These added extras exemplify the commitment of Coursera and the course organisers to bringing as many characteristics of the classroom through your laptop and directly into your living room as possible. The attention to detail not only provides users with a deeper learning experience, but also shows off the potential for Coursera and other online learning platforms to participate in something quite revolutionary: the democratisation of education.

The online course is designed to simulate, to the greatest degree possible, the experience that any undergraduate attending the course at the university would have

Innovative education
Coursera is an online education platform that works in partnership with top universities and organisations from around the globe, aiming to bring the best courses, taught by the best teachers, to everyone and anyone, for free. Since its inception back in 2011, it has been making great headway, with over 10 million users taking part in the 500-plus courses it has to offer. Even more impressive than that is the fact the company has so far raised over $80m in venture capital.

This has inevitably set cynics’ alarm bells ringing: it may seem surprising that opportunistic capitalists are showing so much interest in socialised education. But the reasons investors are willing to throw capital at Coursera become clearer after a closer look at the various monetisation methods the provider of massive open online courses (MOOCs) has attempted over its relatively short lifespan. In a 2012 blog post, the company boasted of the success certain students had enjoyed in securing employment after completing one of its courses. “One student recently told us how the Gamification course helped him land a position with a gamification company”, it states. “Another student, Dawn, accepted a communications position with the University of Illinois Cancer [Centre] after completing Fundamentals of Pharmacology.”

The preamble acts as a means of introducing the company’s plan to develop Coursera Career Services, a recruitment facility aimed at connecting their students (Courserians) with companies looking to poach prospective talent. Students were able to opt in to the scheme – which, given the state of the job market, many chose to do – while companies interested in enlisting high-performing students could expect to pay a flat fee for the privilege. Though the service has since been scrapped (presumably due to a lack of interest, as Coursera boasted just one fifth of its current 10 million members at the time), students should not be surprised if it resurfaces at some point in the future.

Raising funds
One model that continues to be a revenue raiser for the company is its ‘signature track’ program. It links completed coursework and exams to users’ identities, providing an authentic record of their achievements. In order to accomplish this, the program uses keystroke dynamics: by monitoring students’ unique typing patterns, it ensures they do not cheat by getting someone else to sit tests on their behalf. The program was launched in January 2013 and was initially only made available to a handful of classes, but has since been extended to cover many more. The program gives Courserians the opportunity to earn what Coursera calls ‘verified certificates’, which are issued in partnership with the participating university and act as a sort of mini-diploma.

“When we started offering our courses on Coursera, we aimed to extend the reach of our university’s intellectual strengths beyond our own halls, to a global classroom”, says Peter Lange, Provost of Duke University. “Now, we hope that these credentials, while they will not contribute directly toward a degree, will afford students around the world, of all ages, backgrounds and resources, an opportunity to have a legitimate credential for their work in order to advance their career or fulfil themselves personally.”

Though the certificates give a means of verifying successful completion of the course, students are expected to pay in the range of $30 to $100 per course for the privilege. While Coursera does offer a free ‘Statement of Accomplishment’ to its students, a number of courses no longer offer the option. Students’ protestations have not stopped the company raking in an astonishing amount of money from the certification scheme: in its first year alone, total revenues reached a staggering $1m. By April 2014, the company’s revenues reached $4m.

Currently, verified certification does not carry credit redeemable towards a bachelor’s or a master’s degree – all it does is prove the student has passed the online course and that they did so under their own steam. This could change, however. The possibility for formal acknowledgment comes from working alongside the American Council on Education (ACE) and its member schools, which have discussed the possibility of permitting the successful completion of Coursera’s signature track scheme to contribute two to three credits in a student’s academic application.

Academic reputation
In an interview with India’s leading business newspaper, The Economic Times, the CEO of Coursera, Richard C Levin, acknowledged that “the biggest obstacle is changing the mind-set” surrounding democratised education. His remarks are no doubt a reaction to the fact that, despite ACE’s recommendation, many institutions will likely snigger at the prospect of offering students from such an educative background the opportunity to stand on the same podium as the students that enrol ordinarily in their courses. And why shouldn’t they? Education is big business, and the institutions at the top of the pyramid offer a premium product. But there is still another option available to MOOCs: obtaining the acknowledgement of potential employers.

In the current job market, where competition for places is fierce, students and the unemployed are desperate for any quality that can set them apart from the rest of the herd. According to statistics published by Coursera, most of the students who have enrolled with it do so while also working full-time; most likely engaging in the courses for recreation or to assist in finding alternative means of employment. Yet around 20 percent are unemployed, while just over 14 percent have part-time jobs.

At this stage, it is impossible to determine if businesses will see the merit in these new forms of learning, which some would dismiss as pale imitations of traditional institutions – a modern day correspondence course. But something that both MOOCs and younger students have working in their favour is time. The CEOs, executives and middle managers of today will eventually retire, die or otherwise move on, and their cultural values and beliefs of what defines a valuable education will disappear along with them. The young people of today will grow to take those management roles, and the stigma that exists around alternative educational methods will evaporate as these new leaders establish themselves within the business community.

Coursera students pose with promotional T-shirts. Some argue open learning is an alternative to the increasing costs of traditional education
Coursera students pose with promotional T-shirts. Some argue open learning is an alternative to the increasing costs of traditional education

Changing industries
One thing that is certain is that the price of higher education has, in many countries, become extortionate. Learning is meant to be an investment, but student loan debt in the US currently stands at over $1trn, and is constantly rising. It is a problem that can only get worse. The added threat that rising costs might deter future students from going to university could have severe, long-lasting effects – especially in a world where technical skills will become ever more important to gaining employment.

MOOCs provide a secure alternative, and one that comes at a fraction of the cost. “When Google came out, it had a profound impact on access to information”, Levin told tech news site Re/code. “The first order wasn’t to drive Encyclopædia Britannica out of business. Though they eventually did.”

However, there are those who believe MOOCs are not doing enough. Sir John Daniel, former Vice-Chancellor of the UK’s Open University, attacked Coursera for not publicly offering up the course materials it creates in partnership with institutions under the Creative Commons Licence: the licence that allows authors to give others the right to share, use and build upon work that they have created.

“While MOOCs have open enrolment, many of the MOOCs offered through commercial partners do not have open licences… It would be a pity if MOOCs were to act as a brake on the open education movement”, Daniel said at the Worldviews Higher Education and Media conference in Toronto last year. “Attempts to monetise internet activity usually degrade the user experience. Copyrighting MOOCs’ content rather than making it available as [an] open education resource is a good example.”

In Daniel’s view, there are two very different ways of interpreting what ‘democratising education’ means: one view centres around the idea of increasing and widening access to higher education; the other suggests giving students greater control over the content that makes up their curriculum.

Taking control
The fact that Coursera does not own the content of its participating commercial partners (which, in this instance, are the established educational institutions) means those organisations still hold all the power. That educational establishments have been unwilling to fully open up their courses to be shared, used and built upon highlights that they are not joining forces with MOOCs for altruistic purposes, but because they recognise this is the direction in which education is heading. They are complying to the extent to which they are happy, but are not willing to give up their control completely.

For now, Coursera gives wider access to education, and while, as a society, we are a long way from truly democratised academia, the strides that are being taken are definitely in the right direction. But it will take time for massive open online courses such as Coursera to build upon what they have created. Look at how major television networks have had their monopoly eroded by the force of the internet, with content providers such as Netflix driving down prices. The music industry has faced a similar situation, with record labels seeing their power diminished at the hands of file-sharing sites and streaming services such as iTunes and Spotify. It seems that education institutions are just the next industry on the internet’s hit list.

Microsoft unveils new Windows

Posted on by Charlotte Gill

After a series of disappointing new versions of its widely used operating system, Microsoft has unveiled what it hopes will be the one to recapture the enthusiasm of yesteryear – Windows 10. However, unlike previous versions of the operating system, Microsoft is hoping to entice new users by offering Windows 10 for free for the first year.

This approach has been hugely successful at Apple, which has offered its OS X operating system for a number of years now, therefore ensuring customers are using the most up to date services possible.

Microsoft’s operating system has for years become known as a functional platform that people are forced to use

The last version of Windows to be unveiled – Windows 8 – was a radical departure from the traditional operating system, incorporating a new tiling platform that was aimed at simplifying the user experience. While some praised the bold new style, many existing users were dismayed at the changes; feeling they were unnecessary, confusing, and an attempt at aping Apple’s simplified user experience. A later update allowed users to remove the tiling system.

Microsoft’s operating system has for years become known as a functional platform that people are forced to use – it dominates workplace computing – rather than something that people actually enjoy working on. By contrast, Apples OS X platform has been praised for its simplicity. One area Windows has been praised is its cross-platform use.

Windows 10 will continue to go down the route of standardising the operating system across all of Microsoft’s platforms – personal computers, tablets and smartphones – and represents the first major software release of new CEO Satya Nadella. Unveiling the new platform yesterday, he said, “Today’s a big day. A big day for Windows. What it means to our customers, our partners and Microsoft. We want to move from people needing Windows to people loving Windows.”

Alongside the new system will be a series of new services, including the voice assistant Cortona, a new browser dubbed Project Spartan, and a surprise new headset called HoloLens that will enable users to interact with 3D holograms. However, while impressive, many critics have questioned the timing of the HoloLens announcement, seeing as Google just retired its similar unsuccessful Glass product.

The case for and against farming subsidies

Posted on by Charlotte Gill

Michael McCaw

Farmers are living vulnerably, teetering above the poverty line and operating at severe and consistent losses. A producer of a good or service cannot continue to produce it for less than the price at which it is sold, but this is exactly what is happening to small- and medium-sized farms.

Governments do the bare minimum to support agricultural markets

As large-scale supermarkets dominate supply figures, they also dominate and set price levels. The situation in most developed nations is the same, providing a prime example of the failings of the oligopolistic conditions in which the few enforce their own favourable rulings on the many. The supermarkets’ large scale and prolonged egregious treatment of producers would be investigated in any other industry, but because of the misconception that agricultural markets are relatively stable – and have become less significant as economies become more advanced – governments do the bare minimum to support them.

Consider pulling subsidies, letting our producers fall by the wayside and allowing supply to move abroad. First, the countryside as we know it will become unrecognisable as seismic urbanisation processes take over. Sustaining our biodiversity has become an issue of the highest importance, and we must retain that concern at all costs.

Second, we will become extremely vulnerable to shortages and droughts in other countries without the safety net of subsidies and controlled long-term storage. This creates swings and imbalances in both supply and price. Of course, the effect of this will be felt on our own complementary and substitute goods, creating unpredictable changes in a variety of product prices.

Lastly, we have no control over quality. As most multinational organisations have learnt, standards vary from country to country, and importing from, and exporting to, foreign markets (used to certain ideals of quality) can be a dangerous business indeed. One need only think back to the UK’s horse meat scandal to realise the sensitivity and importance of the issue. By turning on our domestic producers, we’re admitting quality is no longer an issue. On an economic level, relying further on imports is madness – particularly given one of the prime resources of most countries is their land.

As a proponent of free market economics, it’s difficult to justify getting behind any policy that places the responsibility of markets in the hands of the government. But here is exactly where nations must rely on government intervention: when market failures – inherent in any system – force pressure on an otherwise stable economic structure.

If there’s a problem with current subsidies, it is in the infrastructure. Stories are rife of mismanagement across most developed nations, in which drought support has been provided when there’s been no drought, or when emergency support has been miscalculated. But the system should be reviewed and recalculated, not dismantled. Another aspect that should be considered is enforcing pricing changes on the buyers, rather than letting supermarkets force prices ever lower.

Between 2008 and 2010, the UK and US governments bailed out large swathes of the banking system. Turning our backs on agricultural industries would be just as destructive as the fall of any of our major financial institutions. The generation of wealth has gravitated toward the cities in recent years, granted, but to let agricultural output suffer would be uncompetitive, impractical and uneconomical.

We're helping the wrong cows

Proponents of agricultural subsidies would have you believe that, for every pint of milk squeezed and captive animal slaughtered, farmers are given only an ever-so-small portion of what they’re actually owed. The fear for these people is that, without state intervention, the industry would struggle to make ends meet. The reality is far more complicated, and the case could even be made that the prescribed solution has actually introduced distortions into the market and succeeded only in sweeping the bigger issues under the rug.

What began as a simple incentive programme has since morphed into a wealth enabler

Modern subsidy programmes can be traced back to the US Agriculture Adjustment Act of ’33, which essentially paid farmers to hold fire on production and fight the issue of oversupply. What began as a simple incentive programme has since morphed into a wealth enabler, and the costs associated with it have been passed onto unsuspecting customers, small businesses and those in developing markets. Where once subsidies signalled a well-meaning attempt to protect food security and support agricultural development, their continuation is founded on a serious misconceptions about the state of the industry.

The underlying assumption is that any subsidies will alleviate farmer poverty and stabilise volatile prices, yet the system rewards commercial-sized farms over family farmers and applies external pressures on prices. As it stands, those with the most land are rewarded far and above those with smaller estates, and the system excludes lower earners and inflates already excessive land prices. In developing nations, meanwhile, competitive practices are too easily overlooked, given the handouts are less and the advantages hard to detect. The costs of farming have become increasingly detached from reality, with the price paid for in full by the taxpayer.

The EU alone spent an estimated €55bn on its maligned Common Agricultural Policy in 2012, and, by 2020, the figure is projected to inflate by another €8bn. To present a clearer picture of the costs, EU agricultural handouts in 2012 accounted for 47 percent of its total budgetary spend, despite its recipients representing only 5.4 percent of the population and a mere 1.6 percent of GDP.

Here it becomes clear the deficiencies in the system are manifold, not to mention that loss-making farm practices are sustained by artificial means, and areas in need of improvement made more difficult to detect. Effectively, offending governments are offering an arm to loss-making practices, which eliminates any incentive to invest in new technologies, such as vertical farming and waterless crops.

It’s true that, without farming subsidies, the agricultural industry as it exists today would struggle to maintain its current crop of success stories, but abolishing the handouts would likely boost growth in the long-term. Straying from the system and opting instead for a free market economy would create a more realistic picture of where farming stands, and make clear where changes must be made.

This is not to say there aren’t instances of hardship in the farming community – as indeed there are many – but the solution is not simply to quash the most immediate concerns and overlook the underlying issues. With subsidies in place, the regime will favour wealthy names and mature markets, while smaller operations in developing nations – where agriculture is of far greater importance – will be starved of the opportunities they’re due.

A new age dawns for Poland’s energy sector

Posted on by Charlotte Gill

Poland’s story differs from that of its EU peers. It remains the only one of the 28-member bloc to have escaped a recession in the aftermath of the European debt crisis. Once a communist nation brimming with government corruption and mismanagement, the country’s successes in the years since stem from an agonising transition to a free market economy and the many reforms introduced in the years thereafter. With this, international investors have been quick to pounce on a hotbed of opportunity, with a view to staking a claim in what is Eastern Europe’s most accommodating business climate. Fast-forward to today and the coal-dependent economy is about to undergo a major transformation, bringing with it a breadth of new challenges and opportunities for business and investment.

Bolstered by improved capital markets, social and political reforms, generous government incentives, tax planning opportunities and a growing pool of talent, the country is also known for its unwillingness to comply with EU targets. Looking at the country’s economic performance from an objective perspective, it’s clear Poland has succeeded where so many in the region have not. So it’s no surprise the country’s leaders are sceptical of EU ambitions that appear to conflict with their own.

The country’s hesitance to comply with EU obligations is best seen in its criticism of climate change policy, particularly last year, when the European Commission set out a plan that stipulated member states must slash their 1990 emissions by 40 percent before 2030. The union’s larger members warmly received the measures, but Poland was less than enamoured. Fearing the proposals could inflate domestic energy prices by as much as 120 percent, some have asserted that, in drafting the plan, the EU has failed to take into account Poland’s runaway coal industry.

90%

Of Poland’s electricity comes from coal

100k

People employed by the Polish coal industry

Good coal/bad coal
Sources in Poland have already blocked a series of milestone targets set by the EU, on the basis that the measures could triple or even quadruple energy prices after 2020, according to the Polish Chamber of Commerce. Given that such a large proportion of the national economy rests on coal, the expectation that Poland can reach the same targets as those in Western Europe, and without consequences, is unrealistic. “Some things in the last EU Climate Summit conclusions have to be cleared,” says Dominik Smyrgała, PhD at the Collegium Civitas and Head of the Postgraduate Programme in Energy Security. “If the benchmark year remains 2005 and GDP level for free allowances is anything different than 2013 in market prices denominated in euros, I seriously doubt that we will be able to meet the objectives.”

The country could struggle to reduce its reliance on an industry that provides approximately 90 percent of its electricity and employs over 100,000 people. In fact, the scale of the industry is so vast that Poland is in the world’s top 10 producers, according to the World Coal Association, with only Russia and Germany ranking ahead of it in Europe.

By the end of October, EU leaders finally clinched a deal, albeit with a number of concessions thrown Poland’s way. With leaders having warned the country would oppose any measures that might inflate energy prices, Poland was dealt 200 million carbon emission credits and two percent worth of emissions permits from the European Emission Trading System. Smyrgała says the EU’s climate changes might bring new opportunities for those looking to invest in Poland: “And from another perspective, maybe some external pressure will eventually force the Polish energy sector to modernise.”

Necessary diversification
“Energy balance constitutes a vital part of countries’ energy safety policy and strategy,” wrote Wojciech Opioła and Grzegorz Omelan of Opole University in a study titled Poland’s Energy Balance and its Future. “This factor, if well-developed, may serve as one of the sources of the countries’ high stand on the international arena, and may become the basis for people’s well-being and the fast development of economies.”

As it stands, Poland is so heavily dependent on coal that natural gas and clean energy alternatives are afterthoughts in terms of development and investment. Yet these are the two sectors that harbour the greatest opportunities. “We have a lot of energy investment in the pipeline”, says Marcin Korolec, State Secretary of the Government Plenipotentiary for Climate Policy. “Next year we will finalise an LNG terminal, and two new coal plants are at early stage of investment. There is a nuclear development programme on the way and new draft legislation on renewables support. At this stage, all things are in motion and I don’t see new climate and energy framework merits radical changes to what we are already doing or a direction in which we are moving.”

Crucially, in 2014 the Polish government laid out a number of long-term subsidies for renewable energy in a bid to attract more consumers to the fold and meet EU emissions targets. “In my own opinion – and the opinion Polish Climate Coalition, of which I am an expert on European climate policy goals – there are tremendous opportunities for the Polish economy”, says Zbigniew Karaczun, President of the Board for the Mazovian branch of the Polish Ecological Club. “Let’s not forget that the Polish energy sector is the main source of the highest health costs in Europe. So the change of an energy sector creates a chance to improve the quality of life of millions of Poles. To sum up – in my opinion, as well as in assessment of the organisation I am representing – the implementation of the EU climate policy objectives will support the further economic growth and civilisational development of our country.”

The greater half of the promise, however, lies in the natural gas sector. Poland is home to some of the largest reserves in Europe and could conceivably upset the geographical balance of power. Estimates of the country’s recoverable reserves have come in as high as 4.1 trillion cubic metres, and, provided the country is quick to instrument the necessary infrastructural improvements, Poland could soon emerge as the next frontier for a European shale gas explosion. With the “Golden Age of Gas” upon us, according to the International Energy Agency, the fastest growing economy in Europe will likely have a vital hand in leading the charge.

Nevertheless, coal will remain the country’s primary energy source at least up until 2060, according to the Department of Strategic Analysis, though the addition of alternative energy sources to the mix will create a more diversified investment climate. “The Polish energy sector is a huge construction site with plenty of investment opportunities”, says Korolec. Karazun, meanwhile, insists: “To unlock this potential, we need an adequate legal basis and long-term development strategy, pointing to the need for low-carbon development.”

Some might look at the challenges facing the country’s coal industry and say the opportunities for investment are less. But that is to neglect the benefits waiting in the wings, as a diversified energy sector will surely create a more balanced economy.

Google buys into SpaceX

Posted on by Charlotte Gill

The two entities will acquire just under 10 percent of SpaceX, the American space transport venture which has been valued at $10bn. Part of the $1bn funding will be spent on creating satellites that would provide remote regions across the globe with access to the web.

The move seems to mark a revival of Google’s attempt at global connectivity in 2013, when it trialled ‘Project Loom’, a plan that saw web-carrying balloons soar over the world’s most underconnected areas. The tech giant has also been buying into space in other ways, purchasing satellite firm Skybox Imaging for $500m in 2014, for example.

Musk said the satellites would also provide a much-needed means of communication in the event that humans inhabit Mars in the future

Entrepreneur Elon Musk, who founded SpaceX in 2002 – seemingly a side-venture from his role as CEO of electric car-maker Tesla – had already outlined a $15bn project that would see hundreds of satellites circling the earth in low orbit to accelerate data transfer and spread internet access out to a wider portion of the world.

“The long-term potential is [for space] to be the primary means of long-distance Internet traffic and to serve people in sparsely populated areas”, he told Bloomberg Businessweek. “Our focus is on creating a global communications system that would be larger than anything that has been talked about to date.” He added that it’s likely to take at least five years for the vision to become a reality.

Musk said the satellites would also provide a much-needed means of communication in the event that humans inhabit Mars in the future – a belief the billionaire has expressed on several occasions.

But the financing provided by Google and Fidelity will also be targeted at a range of other innovation objectives. “This funding will be used to support continued innovation in the areas of space transport, reusability, and satellite manufacturing”, SpaceX said in a statement. Investors already in on the company include Founders Fund, Draper Fisher Jurvetson, Valor Equity Partners and Capricorn.

It’s an interesting move given Virgin Galactic’s recent investment in OneWeb. Headed up by Greg Wyler – who departed Google’s doors in 2014 – OneWeb is likewise working on satellites that would improve web connections, and Facebook has meanwhile laid out intentions to use drones to achieve a similar aim. It remains to be seen whether these ambitions succeed, and if space does eventually prove the solution to improving universal communication – both on and beyond the Earth.

Eaglestone Advisory on Angola’s bright future | Video

Posted on by Charlotte Gill

As Walmart establishes stores in Angola, retail industry watchers say larger trends are taking place in a country once defined by civil strife. One company that has taken off is Eaglestone Advisory. The New Economy speaks to its CEO and Founding Partner to find out more.

The New Economy: Now Pedro, we know that Walmart’s presence in Angola is a signal of larger trends relating to demographic shifts; can you tell me a little about them?
Pedro Neto: It’s good for everybody to know that last month came out the first census of the population of Angola since independence. So, last month we came to know that the population of Angola is now around 24 million, with a large concentration around Luanda, the capital, with around seven million. And with the young population, probably close to 50 percent.

We have now a growing consumer segment. The importance of the middle class is increasing. We’ve come to the conclusion after a recent study from one of the large South African banks that the middle class represents around 25 percent of households. That was a surprise.

The importance of the middle class is increasing

So there really is a demand for an organised retail sector. And as we have seen in the last two years, after the first retail distribution chains came from Portugal, which were the first players in the market, we have seen Shoprite – the first South African chain – and now more recently we have seen Walmart.

And so there is a trend really to increase the size of the retail sector.

The New Economy: Now according to your company’s own retail and growth assessments, there are a lot of other large chains that are poised to enter into the Angola retail market. Do you think that locals have the purchasing power to be able to really embrace this change?
Pedro Neto: The end of the civil war in 2002, we have seen an enormous growth in the middle class. And also the need for lower prices on the products that people need to consume.

And you have a country, like many others in Africa, where the informal market represents 70 to 80 percent of the business that is done. And really, entering into the market of the large players represents lowering prices.

People have more things available, people have more access to products. And that has a huge impact on the population. You can buy things today much cheaper than two years ago.

The New Economy: So we’ve heard about the growth and enthusiasm among some of the big players; but then, what happens to the smaller players? Do they still have a place in the local market?
Pedro Neto: The informal market exists, and will continue to exist and have a strong presence. And also, in terms of the large chains, the reality is that today the largest player and the most important competitor is a local brand. It has established itself over the last two years, has gained all the best positions in the market, the best places to open. So Walmart really has a lot to do in order to be the first on the market. It’ll be very tough to be the leading player.

The New Economy: So, your keen insight has told me that there is an emerging middle class. And what happens with any emerging middle class is that they become increasingly demanding of the government in terms of reforms. Tell me: what sort of demands are being made, in terms of infrastructure development, and other sectors as well?
Pedro Neto: For the government, the education and health sectors have always been a high priority. But in recent years, what we’ve seen is a demand for better transport infrastructure. We’ve seen in the capital, Luanda, some initial steps in order to improve the transportation system. You now have a kind of ferry boat scheme to move people around the city – because you don’t yet have a rail system. You have a small rail network, but you don’t have an underground system. So moving people around is difficult.

But I think, in terms of the retail sector, the most critical point is that you have a national programme by the government, from 2013 to 2017, which really has inside a plan to develop a platform of the logistical stations, freezing stations, because that is very important for the development of the retail sector.

Because one of the things that you’re now viewing on the market, is the players want to verticalise the chain. So the largest retailers don’t want just to sell: they want to produce also, in the country. Because in Angola, as in many other countries, almost everything is imported. And that is the main thing that the government wants to change.

So the key now is to produce locally. And to produce locally you need logistic platforms. And you need to have freezing facilities across the country; in order to produce, and then accommodate the process, and transport to the main cities.

The New Economy: Now, with such intimate insight into the local market, can you tell me about what sectors still need to be tapped into?
Pedro Neto: The local expertise on the retail sector, if you have the chance to visit Luanda, it’s already at a very top level.

If you see, the largest retail chain at the moment, Kero, which is a local brand. They are using the best consultants that you can access worldwide. They have their own local brands, they are doing everything as you would in any other market. They are really trying to train people, have the best human resources, really transferring know-how to the country.

We have a long experience in Angola

Of course, it’s not an immediate process. But they have started a couple of years ago, and they are really betting on that.

The New Economy: With your intimate insight of what is happening in the emerging trends in the country, what role does your company play in future development?
Pedro Neto: We have a long experience in Angola. We have been going there almost every month since 2000. And really what we want to do, and what we are doing, is being a bridge platform hub between the local players, the local investors, and the international community.

If we have an international chain that wants to set up in Angola, we can support them in coming to the market, and understanding who are the best players. Trying to advice on the mistakes that we should not make, or the things that are most appropriate to do. And at the same time, we want to be recognised. And we are achieving that from the local players: as an entity that can support them in getting investors from abroad, and supporting them on their expansion plans, and supporting them in their internationalisation activities.

It’s a challenge.

The New Economy: Well, an exciting challenge that you’ve taken on. Pedro, thank you so much for joining me today.
Pedro Neto: Thanks a lot.

Amazon attempts to stay king of the publishing jungle

Posted on by Charlotte Gill

When it comes to retail, Amazon is king. Started out of a Seattle garage in 1994 by a ballsy Wall Street expat, the titanic firm has spent the last two decades buying and establishing more tributaries than the rambling river after which it was named. Amazon is a hardware manufacturer, a digital utility provider, an online video streaming service and a grocery store. It’s also a music provider and a production studio. CEO Jeff Bezos even owns a major US newspaper. But when Bezos founded Amazon 20 years ago, his original business plan revolved exclusively around books. The concept itself was quite simple: to create a reliable digital sales platform that could provide readers with a seemingly unlimited selection of books at close to production price. Not only did the concept catch on like wildfire, it also singlehandedly redefined a publishing industry in crisis.

Book publishers greeted the rise of Amazon with open arms as it did away with archaic industrial redundancies and created a new sales stream that required little-to-no investment from the old guard. It also began to cut into the bottom lines of traditional bricks-and-mortar book chains such as Borders and Barns & Noble in the same way Walmart has notoriously decimated independent retail stores. Yet publishers refused to speak up as overall sales went nowhere but up.

Even for its overwhelming level of market domination, Amazon hardly makes a penny off its book sales

Then Amazon tossed the publishing industry on its head again in 2007 with the launch of Kindle – the world’s first easy-interface e-reader. Before Kindle, ebooks were little more than a spotty, passing fancy. Today, users purchase 457 million ebooks per year. By 2017, those sales are anticipated to overtake hard copies of books. Amazon accounts for 67 percent of all those sales. Yet even for that overwhelming level of market domination, Amazon hardly makes a penny off its book sales. Jeff Bezos is trying to put a stop to that.

A new chapter
According to Bezos’ former deputy, Shel Kaphan, the decision to start an online bookstore didn’t stem from a love of reading. In truth, it was just an easy way to tap a fledgling digital marketplace. Books were easy to ship, hard to break and there were far too many to sell in any physical store. Yet even in Amazon’s early days, books weren’t being sold for a profit. Instead, they were being used as loss leaders to establish a far more crucial means of revenue: web users’ buying habits. By the time Amazon went public in 1997, sales had risen 837 percent, and Bezos announced his intention to start selling music on the site. He had ambitions for far more than maintaining an online bookstore: he wanted to oversee an online “everything store”.

But as more and more media were forced to transition into the digital realm at the turn of the 21st century, books surprisingly turned out to be the most resilient. From 1999 to 2009, the global music industry witnessed revenue declines of more than 50 percent: falling from $14.6bn to just $6.3bn. Newspaper and magazine publishers are scrambling to stay afloat as they attempt to translate web page views into profit. Thanks to the rise of ebooks, traditional publishers are faring comparatively well. Yet, unfortunately for authors, a high digital sales volume does not necessarily translate into increasing profits.

Digital self-publishing
Apart from Amazon’s trailblazing contributions to the now $1.5trn e-commerce market, one of its single most revolutionary contributions to the global media industry has been its role in the advent of self-publishing. No longer must would-be authors hire a literary agent or pay out of pocket for a costly print run of 500 books: they can instantly publish digital copies of their books online for next to nothing. Naturally, Amazon’s platform has made that process even easier.

Today, self-published authors account for nearly 40 percent of all ebook royalties on the Kindle store: across the entire web, they account for around 31 percent of all daily ebook sales. Last quarter, independent authors as a whole brought in more in royalties than the established authors of the globe’s ‘Big Five’ book publishers: Penguin Random House, Macmillan, HarperCollins, Hachette and Simon & Schuster. Under these established firms, the average author’s royalties have dropped by over a quarter in recent years, to just $11,000. So long as novice writers are willing to price their ebooks under $9.99, Amazon is willing to hand them up to 70 percent of sales profits. But the firm hasn’t been getting on quite as well with the publishing institution.

A shot in the foot
One problem Amazon has with ebooks being put out by Big Five publishers is their lack of user compatibility. The bulk of professional publishers employ Digital Rights Management (DRM) encryption software on their ebooks, which makes it nigh-impossible to move titles between devices. Amazon and the Authors’ Licensing and Collecting Society argue that hurts overall sales – and evidence suggests they’re right, as non-DRM books account for around two-thirds of all digital books sales.

But Amazon’s biggest gripe with traditional publishing houses boils down to a matter of cost. Since the start of 2014, Amazon has been trading uncharacteristically public blows with French company Hachette, the globe’s fourth biggest publisher, whose stable of authors include bread winners JK Rowling and Ian Rankin.

According to Amazon, old-school publishers such as Hachette are undermining an exploding ebook market by over-charging for their products. In the US, the typical digital book download comes in at around $14.99. Amazon would have that price cut by a third, and take a 30 percent commission on each sale on top of that. Were ebook prices brought down to a flat-rate of $9.99, the retailer claims, global book sales would nearly double. Bosses at Hachette beg to differ – and so, in order to help them see reason, Amazon raised eyebrows this year by removing pre-orders and slowing down delivery times for some of Hachette’s biggest authors.

Amazon is placing downward pressure on book prices – and while one can argue that lower book prices actively help to promote literacy, others say they are devaluing the product. The book market is already flooded and demand will eventually peak. After all, books are competing with film, TV, video games and a whole host of media that are arguably far better at capturing the public’s interest. By pushing for a lower, standard book price, some analysts argue the perceived value of books will fall with in line with it. Hachette and Amazon ended their dispute in November, with the online retailer offering what it described as “specific financial incentives for Hachette to deliver lower prices”.

Yet with Amazon commanding 67 percent of all ebook sales on the web, even the globe’s most established publishers may struggle to survive for long in the retailer’s bad books. After all, even as Amazon continues to expand into new markets such as postal delivery and mobile handsets, it appears Jeff Bezos and his team will always come back to the written word.

Last summer, Amazon unveiled its latest literary market innovation, Kindle Unlimited, which gives users unlimited access to as many books as their hearts desire (for a monthly fee). At present, that service shuns all books written by Big Five publishers. As always, Amazon is defining the boundaries of the publishing world’s digital existence and cutting-edge innovations such as Kindle Unlimited continue to ensure its survival. Yet there are still a few kinks to work out – and although Jeff Bezos is clearly keen to start improving the notoriously non-existent bottom line of his books division, the move may come at a cost. After all, if Amazon doesn’t make peace with publishers soon, the celebrated works of some of the globe’s most cherished authors might become that much more difficult to track down on the web. That’s bad for literacy, and it’s got to be bad for business.

The vegetarians that are feeding the carnivores

Posted on by Charlotte Gill

Once the province of vegetarians and hippies, the popularity of meat alternatives has grown substantially over recent years. Sales in the US increased eight percent between 2010 and 2012 according to market research firm Mintel. While consumption was once driven primarily by concern for animal welfare, environmental and health issues are becoming increasingly important factors. This has led to a different consumer demographic and a change in strategy for ‘vegetarian’ food companies.

Surprisingly, this shift means market growth is now being driven by meat-eaters: Quorn, the leading meat substitute brand in the UK, counted more omnivores than vegetarians among its buyers for the first time ever in 2014, while Mintel found 36 percent of people in the US eat meat alternatives despite a vegetarian population of just seven percent.

Health ranked as the number one motivating factor for those eating alternatives

Celebrity champions
Meat substitutes have been edging their way into the mainstream market for a number of years, but a surge of activity in 2013 and 2014 seems to have hastened the trend. Sir Paul McCartney’s Meat Free Monday campaign (backed by an A-list crowd including Sir Richard Branson, Jamie Oliver and Vivienne Westwood) sparked global attention in September with its plea for UN leaders to pledge to a weekly meat fast with the aim of saving the planet. A number of universities subsequently stripped their Monday menus of meat in a bid to help. Billionaire Bill Gates has also been prolific on the environmental meat-free front, investing in US start-up Beyond Meat in 2013 and brewing up media buzz when he declared meat equivalents were the future of food.

All of this has contributed to a sharp shift in the perception of traditionally ‘vegetarian’ meat substitutes. Animal-free and vegan food have become a fashion badge; a symbol of trendy eco-friendlieness. “There’s definitely attention on meat alternatives right now”, says Beth Bloom, a food analyst at Mintel.

And it’s being led by some of the biggest culinary names on the planet: Alain Ducasse, the most Michelin-starred chef in the world, recently took almost all meat off the menu in his Parisian restaurant Plaza Athenee (although fish remains a key component). Once again, it was environmentally motivated: “The planet has increasingly rare resources so we have to consume more ethically, more fairly”, he told AFP. Given France’s dedication to tradition, heritage and steak bleu, the move is a courageous one and could mark an intriguing precedent of things to come.

A Dutch team meanwhile launched the Vegetarian Butcher, which sells fresh meat-like products without the meat. Its modern approach and novelly-named dishes (such as ‘chick and chips’, sold in the ‘concept store’) set it apart as a trendy stop-off.

Beyond Meat, the vegan company backed by Bill Gates, takes a similarly meaty-but-not approach, claiming to produce a product as chicken-like as possible. “‘We are obsessed”, founder and CEO Ethan Brown told Fortune. “We call it OCD: Obsessive Chicken Disorder. It has to be exactly like chicken.”

Changing strategy
Imitating meat isn’t a particularly new idea; from Quorn’s mycroprotein products (which first hit the shelves in 1985) to soya and wheat protein products, it’s commonplace among vegetarian foods. What is relatively new, according to Mintel, is the variety of those products on offer. Flavours inspired by wider food trends and international cuisine indicate a more artisanal approach than previously seen. These have proven popular among younger consumers looking to try new foods, says Bloom.

Other products are being marketed as separate, gourmet, vegetable-based foods in their own right (rather than as fake sausages and steaks). “There’s this other line that’s really trying to set their products apart”, says Bloom. “They’re highlighting what they are, such as black bean cakes or quinoa patties.”

Again, there is an element of trendiness driving these products, but there’s also a large dollop of the health factor. Companies such as Quorn have focused their marketing on increasingly health- and body-conscious consumers, emphasising the high protein and low fat content of their meat substitutes. In the study by Mintel, health ranked as the number one motivating factor for those eating alternatives.

Environmental benefits are also a factor, as companies emphasise the comparatively low carbon footprint their products leave. Quorn has been working with the Carbon Trust, for example, publishing the findings of a study on sustainability on its website. This again indicates an effort to target environmentally aware consumers, while animal welfare (likely to limit products to pure vegetarians) takes a back seat.

The shift is particularly marked among young people. In the Mintel study, 35 percent of 18- to 34-year-olds who were cutting back on eating meat said the environmental benefits were their main motivation (compared to 26 percent of everyone asked). Bloom says: “I believe if companies can make that environmental factor clear then it will be a strong selling point, especially among younger consumers who tend to be interested in these larger issues.”

Food for the future
Findings by Quorn show its meat substitutes produce up to 90 percent less carbon than real meat. The impact on climate change of rearing livestock is well known: it accounts for 14.5 percent of greenhouse gas emissions, according to the UN Food and Agricultural Organisation.

With global demand for meat set to increase due to the rise of emerging economies and a growing population, those problems are only going to intensify. According to Tim Finnigan, Head of Research and Development at Quorn, 200 million tons of meat and over one billion tons of cereal production will be required to meet the projected demand. “The consequence of excessive meat production could bankrupt the environment,” he says.

The environmental consequences of excessive meat consumption could, cyclically, impact on the ability to grow crops and thereby feed livestock, meaning rearing would be limited anyway. With decreasing supply will come rising costs, Finnigan says: “We’ve got to stop eating as much meat globally… We have to find solutions. And we have to find other sustainable protein sources.”

The increasing interest in meat alternatives, and the widening of its market (whether driven by strategic marketing, fashion, health, or environmental issues) isn’t just an interesting trend: meat substitutes could be essential alternatives to an impending food crisis.

It’s consumers who are holding edible packaging back

Posted on by Charlotte Gill

Sparking attention in 2012 with ventures such as WikiFoods and Pepceuticals (the latter of which attracted a £1.3m European research contract in its attempt to create an edible coating for meat), edible packaging seemed like a short-lived buzz. But it’s recently seen a revival, with more and more developers getting in on the game. Its supporters are optimistic it could present a viable solution to some of the Earth’s most pressing environmental issues.

Those issues are all too well-known: over 75 million tons of waste packaging was tossed into landfills in 2010 according to Slate, and in the UK an estimated 2.5 billion cups are thrown onto the heap every year (enough to circle the world 5.5 times, according to LondonWaste).

Plastic packaging may also pose health risks. Studies have claimed BPA (a chemical used in the lining of most tin and plastic packaging) can affect the brain and nervous system. That’s led France to ban it from 1 January 2015, following in the footsteps of other EU countries including Belgium, Austria and Denmark. A recent study by the Food Packaging Forum meanwhile found that over 170 chemicals frequently used in packaging could be connected with cancer and fertility problems.

The biggest challenges we see with any disruptive technology are normalising the behaviour and increasing awareness and comprehension

Skin up
Eric Freedman, Senior Vice President of Marketing at WikiFoods, believes edible packaging could be a viable replacement. The company’s sphere-shaped WikiPearls, created by Harvard Professor David Edwards, use a similar concept to fruit, with what Freedman calls a “skin” to protect the food or drink. “Dr Edwards wondered whether it would be possible to design food and beverage packaging like nature designs fruits and vegetables”, says Freedman. “What followed was a longer reflection with Harvard students around the possibility of transporting water in ways inspired by our biological cell.”

According to Freedman, the technology, consisting of a protective electrostatic gel (created through interactions between natural food particles, nutritive ions and a polysaccharide), protects the wrapped food or drink while reducing exposure to unnatural materials or chemicals. After a couple of quiet years selling the product in obscure places – namely the WikiBar in Paris – the concept spread its wings in 2014, joining up with US yoghurt brand Stonyfield to launch Frozen Yoghurt Pearls, and start a roll-out of the products across 50 US stores.

WikiFoods isn’t alone in its endeavour; in 2012, Brazil’s first fast-food chain, Bob’s, started using edible wrappers on some of its burgers, while Australian firm Plantic created a bioplastic using corn starch 10 years ago. New York startup Loliware meanwhile launched itself into the edible packaging stratosphere a few years ago with the novel concept of edible cups, made of a seaweed-based gel called agar that can be either eaten or composted. Co-founder Chelsea Briganti believes the cups could provide a solution to the environmental issues associated with packaging waste. She told The Guardian: “Billions of plastic cups are entering the landfill every year. If Loliware replaces even a small percentage, that would have far-reaching impact.”

Three Imperial College London students seem to agree, coming up with Ooho, an edible water bottle consisting of an algae membrane, developed through a cooking method known as gelification. Packaging labels (using rice paper or similar) can even be attached and eaten. The students have at least managed to convince the design community, ranking among the winners of the Lexus Design Award 2014.

Edible but not appetising
But the design judges might be the only ones fully convinced, at least in the near future. The ‘bottle’ created isn’t particularly practical or appealing, and even co-creator Rodrigo Garcia Gonzalez admitted that in the tests some chose not to eat it. “It’s a gelatinous texture that we are not used to”, he told The Guardian.

Adopting these types of edible packaging on a wider, commercial scale is therefore likely to be a long way off, with a shift in consumer mentality needed before they can properly hit the shelves – something Freedman recognises. “The biggest challenges we see with any disruptive technology are normalising the behaviour and increasing awareness and comprehension, both with retailers and with consumers,” he says. Part of that comes down to potential hygiene issues, but Freedman points out fruit and other fresh goods are already sold unpackaged – and, like fruit, the Wiki ‘skin’ can be washed.

For Freedman, making edible packaging a reality would involve changing the way we shop. “We envisage, in the near future, a merchandising solution that is completely package free”, he says. “Whether from a served bar situation like a gelato bar, or a bulk option in the freezer where consumers can fill their own containers and pay by weight or unit.” Such a transformation is not unheard of: American grocery store ingredients doesn’t sell a single packaged product. But that seems to defeat the very object of ‘edible packaging’, which in theory should protect goods as effectively as plastic packaging.

However, packaging industry consultant Sara Risch told NPR that, if edible packaging is anything like fruit skins, it wouldn’t keep goods fresh for long. That could be risky when it comes to refrigerated products such as meat, and food regulators are likely to take some convincing. As a result, the WikiPearls sold in stores, such as Loliware’s edible cups, are still sold in (biodegradable) packaging. Moving away from that is likely to prove a challenge.

But Freedman is optimistic plastic could be done away with, and that goods such as meat could potentially work. “Meat sounds like a fun one for us to tackle”, he says. “Wiki Meatballs? Wiki Sausage? Wiki Tenderloin?”

That aspect of ‘fun’ is where edible packaging seems to be limited, however. It’s still very much a novelty concept, thought up by excited scientists envisioning a fantasy world from their cloistered laboratories. If edible packaging can be produced on a commercial scale and developed to the point where it protects goods as effectively as plastic, it might well be able to – very gradually – find its way onto supermarket shelves. Even then though, it will likely be some time before people can bring themselves to actually eat the packaging of their food, and achieving that shift in attitude may well prove the largest obstacle. In the meantime, other alternatives are needed if the pressing health and environmental issues associated with packaging are to be solved.

Google hits Glass ceiling

Posted on by Charlotte Gill

It’s the wearable device everyone’s been talking about, but Google Glass, which brings messages, calls and news to the eyeballs of its wearers, is being withdrawn from production on January 19.

The tech giant announced its decision in a Google Plus statement, declaring that the ‘Explorer’ programme under which Google Glass launched was being halted. According to the company the wearable was initially intended just as a prototype to test the waters. “We began the Glass Explorer Program as a kind of “open beta” to hear what people had to say”, Google said in the statement. The device launched in the US in 2013 and the UK in June 2014.

Google could now turn a corner and overcome the mistakes it might have made in the past

According to the company, Glass at Work – which aims to bring the uses of a smartglass to the business world – is fast developing and as a result is “graduating” from the Google[x], labs. Operating as incubators for the initial development stages, Google[x] was the place of birth for the likes of Google Brain, which later graduated to the ‘Knowledge’ team.

“We’re continuing to build for the future, and you’ll start to see future versions of Glass when they’re ready”, Google said. The new smartglasses will be developed in a separate division managed by Ivy Ross, who has led the team thus far. Tony Fadell, CEO of Nest Labs – the smart heating company acquired by Google in early 2014 for $3bn – will oversee the project.

But some are skeptical of Google’s positive spin on the announcement. Among those is senior computing lecturer at the University of Central Lancashire, Nicky Danino, who believes Google made a blunder in putting the Glass Explorer Edition on shelves so quickly. “It’s patently obvious that Google released this product before it should have”, he told The Telegraph. “In my opinion, Google should have kept this project under wraps for longer and waited to release when it was more reliable, and had other uses.”

The device had a hefty price tag – £1,000 in the UK and $1,500 in the US – limiting its reach to a relatively niche market – namely the tech-obsessed – and its uses were further restricted when Twitter and other key players halted the development of their Google Glass apps a few months later. In July 2014, just a month after its UK launch, two Google Glass executives left and key developer Babak Parviz departed to become Amazon’s Vice President.

There were also fears over safety and privacy, with some San Francisco bars banning the glasses following reported assaults on Google Glass wearers. Others were concerned about users being able to secretly snap photos and videos.

But with its apparently more targeted, business-focused approach, Google could now turn a corner and overcome the mistakes it might have made in the past. With the general trend pointing towards a sharp rise in wearable electronics, it’s unlikely smart glasses are going away for good – Sony showcased its own version at CES 2015 with a prototype device that could be attached to ordinary glasses to make them smart. Where the smartglass revolution goes from here remains to be seen, but it seems that budding users will have to wait a little while longer than anticipated to find out.