Growth in Investing  in Sustainability in Australia and Singapore

The Australian sustainable business market will grow to A$2.9bn in 2014 from $1.6bn in 2010, according to a new report from independent analyst firm Verdantix. The forecast is based on analysis of spending by 139 firms with Australian revenues of at least $900m and cross-industry research into over 1,000 Australian corporate sustainability initiatives, including energy efficiency, carbon management, sustainable supply chains, cleantech and sustainable product innovation. And investing in a paperless future is good for the earth and the bottom line. So GreenPost is underway, as Singapore’s only aggregator of electronic bills and statements, presenting them on a single platform for the user’s convenience.

Verdantix report from London (19 April 2011):

The Australian sustainable business market will grow to $2.9bn in 2014 from $1.6bn in 2010, according to a new report from independent analyst firm Verdantix.

The report forecasts that sustainability spending will exceed $1.8bn in 2011, grow to $2.1bn in 2012 and reach $2.5bn in 2013. The forecast is based on analysis of spending by 139 firms with Australian revenues of at least $900m and cross-industry research into over 1,000 Australian corporate sustainability initiatives. The Verdantix model categorises spending by 29 initiatives including energy efficiency, carbon management, sustainable supply chains, cleantech and sustainable product innovation.

“Many Australian business leaders perceive climate change and sustainability trends as a break on growth and a cost to business” commented Susan Clarke, Verdantix analyst and author of the report. “But carbon regulations, rising energy prices and natural resource scarcity also create new market opportunities. Innovative firms like CarbonSystems, Energetics, Intelligent Pathways and WSP Environment & Energy already benefit from the market for energy efficiency and carbon management. A pure focus on blocking and tackling new energy and climate change regulations will protect margins in the short-term but misses out on big opportunities like bio-diesel refining.”

According to the Verdantix report, Australian Sustainable Business Spending 2009-14, the market will experience a 13% CAGR from 2009 to 2014. Sustainability spend will increase by 9% in 2011 compared to 2010. This positive trend will continue with a year-on-year increase of 13% in 2012. The recently proposed carbon price mechanism, if it is implemented by 2013, will cause an increase in year-on-year growth rates, reaching 20% in 2013 and 2014.

Across 29 sustainable business initiatives the Verdantix market forecast finds that spending on smart grid and electric vehicles will grow fastest. Spend on smart grid will grow at a 27% CAGR to reach $72 million in 2014. Electric vehicles and infrastructure will grow at a 22% CAGR to reach $58 million in 2014. Public-private consortium partnerships such as the ‘Smart Grid, Smart City’ demonstration project encourage investment from firms like AGL Energy, Ausgrid and Sydney Water.

Reflecting the structure of the Australian economy, energy and emissions intensive industries account for 43% of sustainable business spending in 2011. The basic resources sector will invest $360 million, accounting for 20% of spend. Oil and gas firms account for 12%, travel and transport 6%, and utilities 5%. Despite strong commitments to sustainability by services firms like National Australia Bank their budgets are significantly smaller than the industrial sectors.

“Australia is already experiencing a boom in commodities demand as the Asian economy gathers steam. Our forecast for a 13% CAGR between 2009 and 2014 assumes economic growth in Australia of 3% to 3.5% over the period,” stated David Metcalfe, Verdantix Director. “Spending on sustainability is positively correlated with global and national economic growth because they drive up the price of fossil fuels and other natural resources. As a result, spending on initiatives such as energy efficiency, sustainability communications, lobbying and renewable energy production will be higher if economic growth is above current forecasts.”

The Verdantix report, Australian Sustainable Business Spending 2009-14, launched today and is available to Verdantix clients at www.verdantix.com.

Verdantix is the fastest-growing, independent, analyst firm focused on sustainable business strategies and market opportunities.

Source: www.verdantix.com

29 Mar 2011

The Business Times (29 March 2011):

Pay your bills and save the Earth at the same time and with the support of a dedicated engineering team from StarHub.

However, with the aid of a co-investment from Spring Singapore and a round of private angel funding, the team managed to reconceptualise the product to draw the data from the biller.

E-BILLING is great. You save trees while you pay your bills, with the mere click of your mouse. When more and more companies start to offer e-billing services, you eagerly take them up, you love the thought of doing your part for the environment, not to mention how convenient it is.

Then comes that one night, which finds you seated in front of the computer, all ready to settle your monthly bills. You soon begin to realise that what was once ‘a mere click of the mouse’ has become a tiresome labyrinth of portals and Web interfaces – a much more tedious process than before.

What you would have experienced, is what Harveen Narulla, director of GreenPost, calls ‘multiple log-in fatigue’, a phenomenon he feels is the main reason why many people are not going paperless with their bills.

‘At a time when people are increasingly under pressure, dealing with work commitments, family commitments, and a shortage of time, they want technology to make their life easier, not harder,’ he explains.

This is where GreenPost comes in. GreenPost is Singapore’s only aggregator of electronic bills and statements, presenting them on a single platform for the user’s convenience.

‘Every biller wants to pull customers to their website to check bills. It takes a third party who’s not a biller, to say ‘Hey, I’ll aggregate all your bills,’ and that is what we are,’ says Mr Narulla.

GreenPost currently aggregates bills from some of the highest volume billers in Singapore (M1, StarHub, SingTel, Singapore Power services, NUSS Alumni club), and plans to link up with all billers – not just the top volume ones – by 2012.

The company also aggregates bills from Malaysia (Maxis, Digi, TNB), and Australia (Optus), and intends to expand its presence in both. Plans for India, Hong Kong, and America are in the pipeline.

This will save upwards from two million pages of paper per month, a conservative estimate based on a function of user take- up rates, the average number of bills per person, and the average amount of paper used to mail a single bill.

‘We will achieve these numbers with 125,000 users,’ says Anand Singh, the founder and CEO of GreenPost, who pointed out that signing an agreement with any of the six banks they are currently in negotiations with would allow them to hit 400,000 users within six months. These six banks include OCBC, HSBC, Standard Chartered Bank, UOB, ICICI, and ANZ.

Under the pending agreements, users can choose to display the bill information aggregated by GreenPost within an Internet banking platform of his choice. This gives the user the convenience of having his bill information alongside the bank’s existing payment service, making it much easier for him to make payments.

GreenPost is also in the process of negotiating commercial terms with the most common payment collection providers, which will enable users to pay their bills from the GreenPost portal itself.

Data analytics and a bill archive are also available, allowing users to keep track of their bill history from up to two years ago.

To top it off, all these benefits will be provided to users for no charge at all. So where does the money come from?

Former Bloomberg news anchor Bernie Low posed Mr Singh the same question in 2009, describing the company as a free service, an effort to save the trees. ‘It’s not a business model right?’ asked an incredulous Mr Low. ‘You’re not a money making proposition.’

Mr Singh disagreed, describing three ways in which the company intends to make money, charging billers a portion of the cost savings GreenPost affords them through reduced paper costs, advertising revenue from intelligent ad banners (replacing the marketing pamphlets often sent together with bills), and charging a fee for payment collection.

Today, the business model has evolved to include two more – the accumulation of carbon credits from forest savings, and a paid curtain where users can pay to upgrade their accounts to include more in-depth bill data analytics and a larger archive.

Things weren’t always smooth going though. The company struggled to attract initial investment due to the financial crisis in 2008 and a general wariness toward B2C (business-to-consumer) companies by investors in Singapore – something Mr Narulla attributes to the unique revenue cycle of a B2C company.

The revenue cycle of a B2C company ‘is almost flat for a long while, hits an inflection point and then spikes’, something Mr Narulla feels Singapore investors are relatively unfamiliar with, compared to the gradual growth curve of a traditional company.

To make matters worse, the original idea, incubated with the assistance of NUS in 2005, of linking up biller systems with the GreenPost platform was deemed unfeasible despite successful technical integration due to cost, says Mr Narulla.

‘Integration by connecting directly with biller systems, and pulling data from biller customer management systems is a very expensive exercise,’ he explains, referring to the pilot tests done with the support of a dedicated engineering team from StarHub.

However, with the aid of a co-investment from Spring Singapore and a round of private angel funding, the team managed to reconceptualise the product to draw the data from the biller’s portals, which avoids the hugely expensive integration challenges the company had faced before.

From then on, the company launched its beta platform in September 2009 and launched commercially in March 2010.

It has since developed mobile apps for the iPhone and iPad in June and August of 2010 respectively, with plans to release an Android app in May 2011, making it the first bill aggregator in the world to incorporate a mobile platform.

GreenPost was also selected as technology partner by CrimsonLogic for its bid for the Singapore government’s OneInBox tender, which, if successful, would see them aggregating all Government-to-Citizen correspondence.

Mr Narulla hopes to be supporting the top 20 billers in Singapore, India, Malaysia, Hong Kong, and Australia by the end of 2012, and to fully commercialise three of these countries in a three to five year time-frame.

Says Mr Narulla, ‘We believe that we are doing something that could change the shape of the world. It could lead to hundreds of thousands of trees still standing.

‘If people’s mindsets and attitudes don’t change, the last tree will fall one day. But if through our lives, work, and involvement we can delay that by even 20 to 50 years, we will have done our job.’

Source: www.spring.gov.sg  and  www.gogreenpost.com