McKinsey Resource Revolution Chapter Summary

1. Progressively cheaper resources allowed global economic growth during the 20th century

2. The world could be entering an era of high and volatile resource prices
The resource challenge of the next 20 years will be quite different from any we have seen in the past in five main ways:
• Up to three billion more middle-class consumers will emerge in the next 20 years
• Demand is soaring at a time when finding new sources of supply, and extracting them, is     becoming increasingly challenging and expensive
• Resources are increasingly linked to one another
• Environmental factors constrain production
• Growing concern about inequality might also require action

3. Meeting future demand would require a large expansion of supply

4. A change in resource productivity is possible based on 15 opportunities
These 15 opportunities are:
a. Building energy efficiency (all GAE investee companies)
b. Increasing yields on large-scale farms
c. Reducing food waste
d. Reducing municipal water leakage (Paradigm Env. Technologies)
e. Urban densification (leading to major transport efficiency gains)
f. Higher energy efficiency in the iron and steel industry
g. Increasing yields on smallholder farms
h. Increasing transport fuel efficiency
i. Increasing the penetration of electric and hybrid vehicles (REV Technologies)
j. Reducing land degradation
k. Improving end-use steel efficiency
l. Increasing oil and coal recovery
m. Improving irrigation techniques
n. Shifting road freight to rail and barge
o. Improving power plant efficiency

5. Additional efforts would be necessary to address climate change and universal access to energy

As you look through the above list under #4, you will notice that GreenAngel Energy investees are busy at work doing many of these things. Light-Based Technologies is creating semi-conductors for LED lights that help build energy efficiency (#1) while DPoint is helping in the same area with their technology that helps recapture energy from building HVAC systems reducing energy costs. Paradigm’s MicroSludge technology is helping to reduce municipal water leakages (#4) by extracting more reusable resources from the waste early on in the process that decreases the volume of waste which in turn reduces the amount of waste that can be leaked while also removing resources (like methane) from the waste that can make it more dangerous to the environment in the case of leakage. Both REV Technologies and Delaware Power System Corp are helping to increase the penetration of electric and hybrid vehicles (#9) through REV’s smart grid technology and Delaware’s integrated battery technology which allows for electric vehicle manufactures to speed up their introduction to the market due to its highly universal communication tools. Meanwhile Habitat Enterprises creates software that helps identify the incentive programs that exist for those who implement measures to help realize those activities listed under #4 above.