The No Go Zone - Environmental Technologies Are VC’s Stepchild, For Now
Posted by naama | Posted in Cleantech Analysis & Opinion | Posted on 14-12-2008
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Recently, a series of reports in the Israeli media have put a renewed focus on the link between environmental contaminants and human health, making the need to immediately implement more of the environmental technologies out there more than food for thought.
One was a report on the troubling rise in the cancer incidence of IDF soldiers from the Nahal Training Base. Israel’s Channel 2 reported that in the decade between 1994 and 2004, Nahal soldiers contracted lymphoma 2.5 times more than those serving in the Golani and Paratroop brigades. That same report noted that the training base was not far from sewage cesspools (pictured) and several chemical factories that were polluting the area. Daniel Pedersen’s article on Greenprophet.com does a nice job summarizing the contents of the report and the IDF response about the causes and linkages.
This report brought back unpleasant memories of two other well-publicized incidents, the Kishon Affair and the Yarkon Bridge Collapse.
In the Kishon Affair, it was discovered in May of 2000 that that dozens of naval commando fighters had been afflicted with cancer after conducting regular diving training sessions in the Kishon river as part of their regular training. The Kishon river has been transformed, over the course of several decades, into a receptacle for the pollutants of several of Israel’s most polluting industrial plants including the oil refineries, petrochemical and fertilizer plants, and the sewage treatment plant. Severe contamination has destroyed the natural ecosystem and has transformed the channel into an open sewage canal flowing into Haifa Bay.
Three years earlier in 1997, three Australian athletes perished after a bridge over the Yarkon River collapsed during the opening of an international sports festival. They did not die of injuries suffered in their 48-foot plunge into a river, nor did they die solely due to the rush of water into their lungs. All were killed by toxins they swallowed in the evil-smelling waters of the Yarkon River, according to autopsy reports. The most recent contamination incident of the Yarkon occurred in November 2008.
Most Israelis are saddened by the undermined health of the environment we witness, even as we are loathe to take on additional effort and cost to prevent it ourselves. In some cases, we are simply embarrassed by the negative attention that a compromised environment brings upon us, or are too fearful to confront its deadly effects on our own well-being. We would rather ignore the issue altogether in polite company, and present a spotless face to the world, certainly when it comes to down to investors. A fact that does not help things along is the spotty and uncoordinated record of local and national government in its environmental standards and initiatives.
The pollutants that are being detected at critical levels in our water supply, soil, and in the food chain altogether warrant immediate attention. Due to the interconnectedness of each facet of environmental care - from replacing use of chemical pollutants like pesticides, treating sewage and industrial waste, conserving and purifying water, to delivering energy from renewable sources and implementing energy saving techniques, a co-evolution of all sectors is the most desirable path for all. As a second-best strategy, improvement in one area is at least a step in the right direction.
In the first post kicking off an intermittent series tracking developments and highlighting notable companies in the various fields of environmental technologies, we look at cleantech solutions emanating from Israel that are being used in the battle against contaminants of the food-chain, the soil, the air, and precious water sources.
All Pesticides Aside…
Israel prides itself on being a net exporter of food and has a highly developed knowledge-set in agricultural methods and technologies. According to the Israel Export Institute:
the value of Israeli food exports is predicted to reach $1B in 2010 compared to an export volume of $650M in 2005. This anticipated rise is partly attributed to the major investments in new technologies and penetration of new niche markets worldwide, such as health foods, organic foods and gourmet ingredients.
Some of the most pertinent advances for sustainable agriculture are in the field of pest management. Pest management is an integral part of modern agriculture. The damage caused by pests is estimated to be between 35-40% of all crops grown around the world. Most of pest control is done by means of chemical pesticides that are spread, as powder or liquid, on plants or ground. The attempt to control pests by repetitive spraying of the fields with highly poisonous insecticides, is problematic for the following reasons:
(1) it may promote the development of resistance to the insecticide in the pest;
(2) it may also kill beneficial insects and natural enemies of the pest as well as other non-pest insects;
(3) high cost of the use of chemicals.
With increasing awareness to the damage caused by pesticides, both to humans and the environment, the number of chemical pesticides that are permitted for use is decreasing, though the demand for food will only continue to grow. Coupled with an expected boom in the insect population as global temperatures continue to rise, pest control for agriculture and disease prevention will be in dire need. Several Israeli companies are already well immersed in the migration to clean technologies for these purposes. 
Agron, based in Givat Brener, is a company that specializes in developing and marketing environmentally benign pesticides for agricultural use, that are selectively toxic to their targets, do not bioaccumulate, and exhibit relatively short persistence in the environment. Their wide range of products run the gamut of fungicides, insecticides, and herbicides to mechanical and pheromone-based pest traps.
Similarly, AgroGreen has made biological pesticides a viable and cost effective alternative for farmers using traditional methods by increasing the shelf life of their non-toxic products and demonstrating effectiveness that matches or exceeds chemical agents. Their BioNem-WP, BioSafe, and SHEMER products treat crop infestations during growth and also protect the commercial value of the final produce from post harvest rot. 
Another actor on the field is ALICOM, a producer of biological mosquito larvicides that are microorganism-based for control of mosquito larvae outdoors. Chemical insecticides currently used to control mosquitoes, either as larvicide or as adulticide, are detrimental to human health and are known to have harmful effects on the environment and wildlife.
Although Israel’s troubles with malaria are largely a thing of the past now, the mosquito-borne disease still afflicts countless people each year in the developing world. In addition, new and re-emerging diseases spread by mosquitoes, such as encephalitis, dengue and yellow fevers, and West Nile Virus contribute to more than 500 million clinical cases each year, according to the World Health Organization.
ALICOM has already entered into negotiations with a potential European distributor.
Taking an approach that bypasses chemical agents altogether, Bio-Bee is a company that offers integrated pest management (IPM) and sustainable agriculture by using naturally occurring processes. At their facility at Kibbutz Sde Eliyahu, the company mass produces beneficial insects and mites, which are natural enemies for biological pest control, in addition to growing bumblebees for natural pollination in greenhouses and open field crops.
Bio-Bee exports to markets worldwide on five continents (excluding Australia), with their most recent partnership taking place in Chile. To watch a short video of the Bio-bee process, click here.
Eclipsed by the Sun
With the spate of announcements and investment deals focused on cleantech developments in the energy sector, particularly solar and wind, it would be a refreshing change to find VC funds going towards environmental technologies as well. While renewable energy has the appeal of gleaming new structures, materials, and the intangible elements, environmental technologies focus our attention to the more familiar, ageless processes of life around us.
With investors having the “double bottom line” in mind, i.e. financial profitability and social benefits of the company/product, it seems counterintuitive to have such an unequal distribution of fund between sectors that have emerged in the last several decades and with those that we have already mastered several millenia ago. A quick look at the portfolios of some of the leading cleantech VCs in Israel (Israel Cleantech Venture, AguAgro Fund, Terra Venture Partners) shows this gap in action. If one looks at time to market, ease of integration with current infrastructure, and risk and capital needed, environmental technologies almost always come out on top compared to energy investments.
Perhaps it is just cooler to say photovoltaic than bumblebee?
More info on related topics:
Michael Pollan talk - a new viewpoint of farming
More about the important role of bees in agriculture
From: Ted









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