Great green careers
Earth friendly jobs aren't just about organic farming and installing solar panels. Meet the carbon traders, eco-bankers and corporate climate strategists shaping the new green economy.
(Fortune) -- Steve Vassallo spends his days looking for the next Steve Jobs. Not for the computer industry, it has its already, but for the clean-tech world in which Vassallo, a venture capitalist, invests. "I haven't found him or her yet," says Vassallo, a principal with Silicon Valley-based Foundation Capital. "They are probably still in their cubicles some place doing their IT job, or in a garage with an idea."
Vassallo, and VCs like him have been pouring money into clean-tech companies in recent years -- $2.2 billion in 2007 -- in the hopes of finding the next leader and the next technology that can transform the biggest industries on the planet, from energy to finance to manufacturing. The opportunity is huge, not just for investors but for those who want to be a part of the green economy vanguard.
A report from the American Solar Energy Society estimates that 8.5 million people worked in the renewable energy and energy efficiency industries in 2006. The Apollo Alliance, a non-profit coalition of people from business, labor and the environmental movement working toward energy independence, estimates another three to five million green jobs could be created in the United States alone in the next decade.
But green collar jobs are not just about organic farming, installing solar panels or weather-stripping. For in the context of what Vassallo and his peers do, green collar jobs are also about building entirely new businesses and upending markets. Fortune found five people already making their mark in the green economy. Are they the next tech titans? Perhaps, but it's early days yet. What is sure, is that each of the people profiled here is forging a new path in their workplace, whether its retail banking or the Internet, and are a model for many more great green careers to come.
For a guy based in a country, the United States, that doesn't yet have a carbon market, Alex Rau is very busy carbon trader. Rau is the founder of Climate Wedge, an advisory firm that helps companies and financial institutions around the world play in the emerging carbon markets. Carbon trading, active in Europe and Japan, is all but certain to come to the United States in the next five years.
The idea for carbon trading is simple enough. Planet warming greenhouse gas emissions get capped at certain level by a government or international body. Companies or other organization are issued permits to emit a certain amount of carbon dioxide. Those that exceed their limit must buy allowances from those that emit less. That's where Rau comes in.
He helps put together financing for projects that can produce carbon credits to sell. It might be a wind farm in India or a methane-capture landfill in the United Kingdom. "We advise a hedge fund in the U.K. and other institutions that invest in the landfills, or buy the credits and resell them later," Rau says. "We are participating in the growth of a new asset class. If you can do something that reduces greenhouse emissions, you can produce an asset."
Already the total of those assets in play is a market worth north of $6 billion by most estimates. And as carbon trading expands in the U.S. and the rest of the world, the market could grow to $500 billion by 2050, according to a Deutsche Bank report. "It's the job of the future," Rau says.
When Lois Quam, former CEO of UnitedHealth Group's (UNH, Fortune 500) Ovations business, wanted to get into the environmental world, she figured she would sit on the board of some eco-minded non-profit. "What hit me over the head is that this space needs executives who know how to bring things to scale," Quam says. "Who know how to take things that didn't exist and make them first into companies, and then into big companies."
That's exactly what Quam helped do in her 18 years at UnitedHealth, helping grow the company's public and seniors health services businesses from $400 million in revenue to more than $30 billion. So Quam took her expertise to investment bank Piper Jaffray last summer and started building its alternative energy/clean technology investment business while overseeing health care services investments).
Quam's job now is to identify small and medium-sized companies that can use Piper Jaffray's help, and its private equity fund of funds, to grow. She and her team focus on four areas: energy efficiency, carbon sequestration, renewable energy and the re-tooling of existing industries.
"The scale [of green technology] is so transformative there won't be any industry that is not affected," Quam says. "I am convinced the green economy both represents the best business opportunity of my generation, and is also the most valuable place for me to use my skills."
After Yahoo co-founders Jerry Yang and David Filo decided they wanted the Internet company to go carbon-neutral by the end of 2007, they needed to find a person who could first tell them the amount of emissions they had to offset, and then figure out the best plan to reach that goal.
The person turned out to be Christina Page, who as Yahoo's new director of climate change and energy strategy spent her first week on the job in the Amazon basin checking out hydroelectric projects. Yahoo (YHOO, Fortune 500), under Page's direction, ultimately invested $2 million to buy emission credits from a hydroelectric project she identified in Brazil and a wind farm in India to achieve its carbon neutral status.
As a former consultant at the Rocky Mountain Institute, Page's job there entailed advising large companies about what they could do to reduce their carbon footprint for reasons of efficiency, economy and goodwill. "As a consultant you make recommendations, hold your breath and cross you fingers that they follow through," she says. "The opportunity at Yahoo was the logical next step for me. Not only can I help influence people within this company to think more about energy and the environment, but as a company we have the opportunity also influence Yahoo's 500 million users worldwide."
At Yahoo, Page is focused on examining all the processes that comprise the company's business and looking for ways to make them more energy efficient. That means building better data centers in Washington state and installing an energy monitoring system so that every Yahoo employee know how much energy a laptop or an entire building consumes. It also means pushing out green tips to Yahoo's users. "It's all about doing better with less for longer," Page says.
Andrew Cartland figures he would have left the recruiting world if he had stayed in his job placing people in tech or telecom positions. But instead he started his own firm, London-based Acre Resources. Acre specializes in finding people to fill jobs in the burgeoning fields of environmental sciences, corporate social responsibility, sustainable development and climate change. And business is booming. Acre doubled its revenue in the past year, sending Cartland on his own hiring spree.
"When we set up shop four years ago, it was more the case of anticipating the market, and so we didn't have much competition," Cartland says. "On corporate and social responsibility competition is growing from other recruiting firms getting into the business, but we have an edge because we got there first."
A survey by Acre Resources found that the number of specialists working in climate change, including carbon traders, analysts and project managers, tripled between 2006 and 2007. "We have experienced a massive upsurge in climate change and energy jobs over the past 12 months," Cartland says. "Most of those are in the United Kingdom, United States and Dubai. It must be one of the fastest growing job sectors in the world at the moment, and we don't see any reason why it would slow."
Not unless one of those new hires comes up with some good answers to our climate ills, which, although it might be bad for Cartland's business, would make the rest of us all very happy.
When Peter Liu looked at funding for green businesses he saw a gap he could fill. If you were a startup you had a shot at getting money from a venture capitalist. But if you were an established green business, without the hockey-stick growth curve VCs like to see, money was hard to come by.
"Credit is probably the most conservative part of the capital chain, as opposed to venture capital," Liu says. "The traditional approach for credit from banks is they look at anything that is emerging as risky, and that's what a lot of green businesses are - emerging businesses."
After raising $25 million in venture capital himself, Liu launched New Resource Bank 18 months ago in San Francisco. A full service retail bank that offers the usual checking and savings, Liu has attracted customers from all over the world (they use online banking) and now has $145 million in deposits.
In turn, Liu is now extending credit and making loans to a variety of green businesses ranging from an organic cheese maker to a company with a new solar panel technology to eco-developers.
For now, Liu is sticking to making loans in the Bay Area, but he has plans to expand first in California and then to other states. There is one banking move he doesn't intend to make anytime soon. "We don't do mortgages," Liu says.