Biome Technologies plc (LON:BIOM) Chief Executive Officer Paul Mines caught up with DirectorsTalk to discuss their commitment to the United Nations Race to Zero & its importance, why biodegradable tree shelters are important, their solution to the problem and further funding from Innovate UK.
Q1: You’ve made a couple of announcements this week. Firstly, a commitment to the United Nations Race to Zero, and then for the funding for the biodegradable tree shelter project. Paul, can you just explain to us what is the UN Race to Zero?
A1: Well, there’s little scientific doubt now that climate change risks pose threats to ecosystems societies and individuals, markets and companies, and a globally coordinated response is required to mitigate and manage that climate change risk.
The UN’s Race to Zero is about governments, businesses, cities, regions, and universities all around the world committing to achieve net zero greenhouse gas emissions by 2050 and, in particular, halving their emissions by 2030.
For those joining Race to Zero, it’s really a commitment to publish our data set targets and report on progress against delivering on those targets.
Q2: Why is it important for Biome Technologies though?
A2: Our fast-growing bioplastics businesses is really at the heart of transforming the plastics industry and really on a quest to reduce mankind’s reliance on oil and gas and move us onto biobased inputs. It’s intrinsically a play about reducing carbon emissions and indeed might create negative carbon emissions.
The brands we sell our products to and their customers, who are often the consumers, are increasingly asking questions about the environmental credentials of the plastics that they use in their supply chains.
So, we think it’s time to provide this data, not only when requested by our customers, but rather also to share it publicly to the markets and demonstrate our commitment to continuous improvement in this area.
Q3: I’m just going to flip that last question again. Why is it important for investors?
A3: Well, clearly, it’s up to investors to make their own decisions on this but I think many investors are starting to ask whether the funds they are investing in are appropriately into companies with high standards of sustainability and ESG, if you like, Environmental, Social and Governance standards. Indeed, I was only reading today that funds based on environmental, social and governance principles have ballooned by some $84 billion over the last few years. So, for many investors, this is more than box ticking, it’s about the ethics and long-term sustainability of the companies they invest in.
So, making this commitment to the Race to Zero, we will be putting the data and targets in the public domain that will allow investors to understand our position on this and commitment to improvement with regard to carbon emissions.
Q4: Just turning to your second piece of news, and this is your third announcement in five months on the biodegradable tree shelters. Can you just remind us why biodegradable tree shelters are important?
A4: There are about 45 million trees are planted every year and most use tree shelters and I’m sure the viewers have seen tree shelters before, they’re often green plastic tubes that you see in their thousands around saplings off to the side of new roads.
They’re essential to the growth of newly planted trees and without them up to 90% of newly planted trees would die, eaten by rabbits, mice, deer etc. So, tree guards do a good job of protecting trees at the beginning of their life for some five years, but we believe some 85% of those tree shelters are left in the environment rather than collected, resulting in some 2,500 thousand tonnes of plastics going into the UK environment every year.
As the government and private individuals scale up tree planting to mitigate climate change, that’s going to grow within a few years to something we believe will be over 4,000 tonnes of plastics being littered into the environment.
Q5: So, what’s your answer to the problem?
A5: I think we’ve got a very simple answer, to make a tree guard that we can be clear biodegrades so we’ve teamed up with a company called Suregreen who are a supplier of high-quality landscaping and horticultural products and we’re testing a new generation of environmentally friendly biodegradable tree shelters.
The product is designed to function like a traditional tree shelter, but then after four or five years be completely broken down by the bacteria in the soil, leaving behind the only CO2 water and a few naturally occurring minerals.
Q6: And why is today’s announcement important though?
A6: Biome Technologies completed an initial feasibility study with Suregreen on these tree guards in the second half of 2020 and the results of this study were really encouraging and gave us the confidence to really push ahead with the project.
We shared this feasibility data with Innovate UK, and they’ve awarded us £250,000 to further invest in this product to take it to commercialisation. The quantum of this financing will not only allow us to complete the necessary lab trials, but also enable us to do large scale tests with our potential customers in fields and forests of the UK in 2021.
So, we think this funding is really going to turbocharge the commercialisation of this product into what’s a large, and if you’ll forgive me, growing market.
