Heinekens and cows and giants, oh my!

CIO Global Blog

17 Jul 2019

Are you in need of summer vacation plans? We suggest CIO's tour of some of the world's most sustainable sites. Our itinerary combines the best of international travel, awe-inspiring architecture, and opportunities to marvel at the convergence of human ingenuity and technological advance in creating solutions to global challenges.

Among the most significant contributors to global challenges is the trend of urbanization. Today, more than half of the global population lives in cities, but by 2050, it's estimated that this figure will rise to nearly 70%1. While urbanization is enabling more people to advance into the middle class, at the same time, it is straining critical infrastructure and taking a toll on the environment. City dwellers tend to produce more inorganic waste (e.g., plastics and aluminum) and use more energy and water, as they adapt to an urban lifestyle involving packaged convenience foods, air conditioning, personal vehicles, and dining out. In fact, it's estimated that since 2008, the 50% of the world's population living in cities have accounted for a disproportionate 75% of energy consumption and 80% of greenhouse gas emissions.

Solving the challenges posed by rapid urbanization is part of the core thesis underlying our Longer Term Investment (LTI) themes. The travel route below draws parallels between our LTI series and our favorite examples of sustainable innovation around the world. Beware: the path to greener cities is dotted with Heinekens, cows, and giants.

Wat Pa Maha Chedi Kaew, Sisaket, Thailand

Need a reason to drink another Heineken this summer? Your used bottle could be recycled into the next building "block" in the Wat Pa Maha Chedi Kaew temple in Thailand. The stunning emerald and earth-toned house of worship is constructed of 1.5mn beer bottles—mostly Heineken, as well as local Chang and Singha brown-hued bottles. This feat of sustainable architecture began with a "100 Bottles of Beer on the Wall" challenge from Buddhist monks to the Sisaket province residents to donate their used beverage containers in an effort to reduce litter and pollution. Three decades worth of bottles later, the site is home to roughly 20 structures made of recycled bottles, including prayer rooms, tourists' bathrooms, and monks' living quarters. The monks' resourcefulness helped to clean up a community, while at the same time saving money on building materials. It's a perfect example of the two-way benefits sustainability can offer.

Besides putting your empty Heineken to good use, proper waste management can reduce methane emissions from landfills and improve living conditions. Supported by several megatrends, we forecast the waste management sector to grow at a high-single-digit rate for the next several years.

Floating Farm, Rotterdam, Netherlands

Forty cows are now floating off the coast of Rotterdam. These sea-faring bovines are grazing aboard the first floating dairy farm in Europe's largest city port. The floating farm is an innovative solution to the world's intensifying challenge of feeding more people with less arable land. Dairy farming at sea is not just about adding more space to raise livestock; its primary advantages lie in the farm's proximity to a major urban area. Producing dairy closer to the city reduces food transportation costs and pollution, and also allows for better recycling of urban food waste—80% of the cows' feed comes from waste products from Rotterdam's food industry. This concept of circularity extends to the farm's structure, which utilizes floating solar panels for all its energy needs, as well as an integrated rainwater collection and purification system for its water demands. The farm also makes use of robotics for tasks like milking, manure removal, and food distribution to optimize the efficiency of its operations. As far as the quality of life on board, each cow has its own stall with soft, yet supportive, rubber floors, and has the option to wander onto a nearby pasture for exercise.

In order to meet the intimidating challenge of feeding 200,000 more people every day, the agriculture industry all over the world is turning to technology and other new techniques to increase yields and efficiency.

Santalaia, Bogota, Colombia

A leafy green giant named Santalaia looms over the eastern edge of Colombia's densely populated capital. Santalaia leads a double life as a multifamily residential tower and the world's largest vertical garden. The tower boasts a lush green exterior comprising 115,000 plants and spans more than 33,000 square feet. A garden of this size filters harmful gases from the air and has the power to produce oxygen for thousands of people annually. In addition to its positive effects on air quality, this eco-friendly living space was designed not to waste water. Humidity and radiation sensors, as well as a water treatment plant, were installed within the structure to optimize water consumption and reduce water waste. In fact, it even utilizes water from the apartments' showers for irrigation!

As our world sustainability tour comes to a close, and we turn our investment mindsets back on, we see numerous opportunities to invest toward a more sustainable future economy. Our examples above show how improving waste management and recycling systems, a focus on green architecture, and rethinking urban food systems are all part of a multi-faceted approach to building more sustainable cities. For related investment opportunities, please see our Longer-Term Investments reports: "Waste management," "Clear air and carbon reduction," "Energy efficiency," "Water scarcity," and "Agricultural yield."

Author:

Laura Kane, CFA, CPA, Head Thematic Research Americas, UBS Financial Services Inc. (UBS FS)
Michelle Laliberte, CFA, Thematic Investment Associate, UBS Financial Services Inc. (UBS FS)