The environmental startups looking beyond carbon emissions

The environmental startups looking beyond carbon emissions

Ecosystem monitoring startups are proliferating and bio-businesses should embrace them

At COP15 last year, more than 330 businesses called on heads of state to make biodiversity and ecosystem disclosure a mandatory part of financial reporting. These included Aviva Investors, BNP Paribas, Danone, GSK, H&M Group, IKEA, Nestle, and Tata Steel.

Their petition recognises that while greenhouse gases like carbon dioxide may have become synonymous with the environmental crisis, they are only one route through which economic activities can damage our planetary life support systems.

Human impacts on the environment can also include soil acidification (influenced by sulphur dioxide emissions), nutrient overloads in soil and water (influenced by phosphorus or nitrogen fertiliser running off from farmland), or water over-consumption.

Although carbon footprint assessments are by now a familiar feature of company ESG filings, it is still rare to see biodiversity and ecosystem impacts included.  For this to change, businesses need access to fast, accurate, and cheap assessment services that specialise in this area.

Ecosystem impact assessments involve taking a measure of baseline ecosystem indicators in a particular place (the ‘normal’ or ‘pre-project state of the environment) and tracking how they change once corporate activities set up there.

The bioeconomy is especially crying out for sustainability assessments that account for the environment as a whole, being one of the sectors most directly dependent on the continued health of wild ecosystems.

Although biodiversity measurement tools are still much less familiar to businesses than to scientists and conservationists, some startups specialising in environmental assessment tech could change this.

Using a combination of sensor-based data collection and modelling, they are offering businesses insights into what their activities are doing to the planet beyond the single metric of carbon.

A young but growing green tech sector

Helsinki-based Sfeeri founded in 2021 is one of the growing number of tech companies setting up in biodiversity monitoring for corporate clients. The company lists itself as a remote workplace based out of a few desks in Hamburg and Helsinki. Indicative of just how young this sector is, Sferri’s website is just a logo and a single email address.

The company is still seeking its first funding but already claims to have created an AI-based ‘versatile tool to assess, manage and report biodiversity impact’ – in other words, the holy grail of ecosystem impacts reporting.

The basic tech and services it offers are common to many environmental monitoring startups that focus on ecosystem and biodiversity impacts. Natcap, a more mature company in the space that was founded in 2018, collects site-specific impact data on corporate projects through satellite, drone, and field research. Combining these with geospatial models, it sketches a picture of a particular habitat before and after a project goes live.

Their objective is to measure the effects of corporate activities in a particular location on surrounding ecosystem functioning, also known as ecosystem services – the unpriced resources we get from the natural world.

What they offer clients are breakdowns of what specific assets like plants or factories are doing to things like the population of local pollination species and soil erosion, visualising these impacts in annotated digital maps.

Also shown on their digital maps are possible nature-restoring initiatives they could implement – for example, by highlighting where best a company could regenerate natural habitats for threatened species within the boundaries of their property.

Spoor is another startup in this space, although its angle is slightly different – it is focused on monitoring bird populations to reduce the risks of them flying into wind turbines. Like natcap, Spoor combines both wildlife monitoring and biodiversity management in one, enabling turbine companies to quickly gain a picture of their likely environmental impacts and ways of mitigating them.

The complexity of biodiversity monitoring

The gap in the market for biodiversity assessment that has existed so far owes partly to the fact that ecosystem monitoring is an extremely complex science.

Greenhouse gas emissions from particular activities are quite easily estimated and we understand the relatively straightforward relationship between tonnes of carbon entering the atmosphere and the degree of warming that results.

Measuring the impacts of pollutants on soils, water, air, and biodiversity is trickier. Cause and effects between various pollutants and ecosystem impacts are more difficult to observe and quantify. They may through multiple mediums at different times –  soil, air, rock, and water – with their presence and effects different to localise.

Another notoriously difficult area of environmental impact to quantify is biodiversity. Even within ecological science, there are different methods and metrics for understanding the diversity of animal and plant species in any given area. Of course, counting up all the types and numbers of species in a forest would be infinitely labour intensive, so there are various workarounds based on sensor-based sampling or citizen surveys of local wildlife.

A more recent advance in biodiversity monitoring is environmental DNA, which measures and detects changes to biodiversity by taking small samples of the physical environment in question – usually water or soil – and analysing the type and distributions of genetic material within it.

Startups in environmental DNA monitoring are attracting quite a lot of investment right now because of the simplicity and scientific accuracy it promises to bring to corporate impact monitoring.

Investor interest may also be gathering because while other ecosystem impacts services rely on remote data collection –  satellite and sensor data coupled with geospatial models – there is a greater sense with environmental DNA sampling that you are extrapolating less and relying more on direct observations of the physical environment.

UK company NatureMetrics is one success story in this rapidly growing space. By 2022 it had raised $25 million by 2022, including from venture capital. The company and its investors are banking on growing realisation among regulators and business operators that nature-based impacts matter and, perhaps more importantly, tracking them may soon become mandatory. Their client base is mainly in industries like energy, infrastructure, and construction which tend to have destabilising effects on their surrounding environment.

Why ecosystem impacts matter

Disrupting the natural function of the ecosystems poses a huge threat to humanity. Soil, water, and air are the underpinnings of our entire food system. Like the carbon cycle, these dynamics can only be stressed to a certain point before they tip over into new and abnormal states that we have not adapted to. Without pollinating species, a healthy water table, and soil nutrients there would be no food production.

Ecosystem impacts have historically been neglected in the whole conversation on the environment. The annual ‘biodiversity Cop’ is far less prominent in the media than the climate equivalent, for example. The silence extends to regulation – there are no international standards for biodiversity and ecosystem impact reporting like for carbon.

This is an oversight that needs correction not least because the way we interact with landscapes and ecosystems can also contribute heavily to carbon emissions and global warming. Fewer animals and plants on a certain area of land mean that piece of land stores less carbon than before. Greenhouse gases previously trapped in the bodies of living organisms are released into the atmosphere.

The bioeconomy must look beyond carbon

Like most other sectors, bio-businesses too tend to focus on carbon emissions when pitching their environmental credentials. However, the bioeconomy has a particular interest in tracking their other impacts too. This is because the basic inputs for the industry like feedstock and genetic material ultimately depend on conserving natural systems other than just the carbon cycle. Biodiversity is essential to provide biotechnologists with industrially useful genetic strains while surprising evolutionary mechanisms in animal species can inspire bio-mimetic innovations.

Understanding non-carbon environmental impacts is vitally important for bio-businesses as they have a particularly close relationship with land and land use. Often, resources for their products are the result of Intensive farming or forestry, activities that can compete with natural habitats if not properly managed.

Ecosystems reporting rules on the horizon

Wildlife and ecosystem conservation might seem like an aesthetic concern – a ‘nice to have’ against the priority of reducing carbon emissions. However, the issue is just as vital. Rich, thriving habitats and stable natural cycles are at the base of our agriculture, health, medicine, and industry, somewhere down the line.

A growing number of startups offering end-to-end ecosystem impact measuring and management systems have emerged and in the future, we will see more demand for their services as official guidelines on biodiversity and ecosystem reporting get hammered out.

Two bodies are already working on this. Later in 2023, the Science-Based Targets Network (SBTN) will release the first standards for setting corporate ecosystem and biodiversity targets. H&M, Tesco, and Nestle are some of the 17 companies that will trial the new guidelines. The Taskforce on Nature-Related Financial Disclosures is simultaneously working on rules for how companies should monitor and disclose their impacts.

Calls to make ecosystem impact disclosure to become mandatory may also gain enough traction for it to become the law. If governments do implement this, consumers and investors will have access to a wider range of metrics when weighing up products or companies. Under such national laws, bio-business that perform highly in a range of environmental categories could find themselves gaining a market edge.


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About the Author: Isaac Washington

Isaac Washington is the most recent addition to our team. Isaac specializes in General News, and Home and Garden news. Isaac has worked for years in the agricultural industry and recently has turned his attention to writing. Technology is one of his passions.