Brace for Impact: Industries on the Verge of CBD Disruption
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Brace for Impact: Industries on the Verge of CBD Disruption

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The following content is sponsored by CannaInsider.

CBD Market Disruption

Brace for Impact: Industries on the Verge of CBD Disruption

It seems as though cannabis is on everyone’s lips these days.

More specifically, the conversation centers around a major chemical compound found inside the plant—cannabidiol, or more widely known as CBD.

CBD’s far-reaching therapeutic benefits are propelling the global CBD market, which could hit $20 billion by 2024. However, industries like alcohol and pharmaceuticals are being directly threatened by this rapid rise.

Today’s infographic from CannaInsider explores how CBD is disrupting these industries, and the latter’s strategies to curb this effect.

Who will emerge unscathed?

CBD Market Spreading like Wildfire

A growing stream of robust research highlights CBD’s benefits in combating certain health conditions, such as:

  • Epilepsy
  • Anxiety
  • Insomnia
  • Chronic pain
  • Arthritis
    • Nearly every product segment, from pet health to beverages, is experiencing a CBD infusion to take advantage of these therapeutic effects.

      This surge in popularity presents significant opportunities to create an entirely new consumer base. Emerging consumers seek CBD products for various applications, such as self-care, socializing, and fitness.

      Going Head to Head with Big Players

      The alcohol, tobacco, and pharmaceutical industries are bracing for impact, as the new variety in CBD products and formats threaten their market share.

      Alcohol

      The percentage of alcohol consumers has dropped by 4.6% since 2000, with changing tastes at the center of this cultural shift.

      New research that tracked behavioural change from 2018 to 2019 found similar results. The percentage of alcohol consumers consuming cannabis has increased from 36% to 45%, while the percentage of cannabis consumers who consume alcohol has decreased from 72% to 65%.

      These behavioural shifts have influenced a significant number of alcohol industry titans to partner with cannabis companies. For example, Molson Coors is entering the cannabis space with HEXO Corp to launch CBD-infused beverages.

      Tobacco

      Similarly, declining smoking rates continue to negatively impact tobacco sales. As many tobacco giants pivot to reduced-risk-products (RRPs) such as vapes, cannabis is also catching their eye.

      Most notably, Altria invested $1.8 billion for a 45% stake in global cannabis company Cronos, potentially signalling the start of many partnerships between the two industries.

      Pharmaceuticals

      The pharma industry is particularly interested in CBD’s therapeutic properties. Medical cannabis sales for 2019 will reach $5.9 billion—poaching $4 billion from Big Pharma’s bottom line.

      This is triggering multinational companies to collaborate with cannabis companies at a furious pace. Partnerships—such as Novartis and Tilray—could unlock more international distribution of medical cannabis, and new pharmaceutical growth opportunities.

      Continuous CBD innovations will not only impact these industries—they could enhance human capabilities and unleash our full potential.

      Civilization 2.0

      A tsunami is unlocking new CBD sub-segments all over the world, with many offering solutions for mood and performance enhancement for both people and animals.

      • CBD for fitness: Incorporating CBD into a workout routine can boost performance, endurance, and recovery. Product types include pre-workout coffee, supplements, and post-workout smoothies.
      • CBD for pets: Proven benefits such as anti-inflammatory properties are driving sales of CBD treatments for pet health. By 2022, this market could be worth over $1 billion.
        • The Unknown Potential

          Applications that will allow a personalized cannabis experience are also on the horizon:

          • DNA-specific strains: Companies are testing people’s saliva to recommend specific strains that are tailored to their specific needs.
          • Odorless cannabis: More pure, less harsh odorless cannabis will soon be available, allowing consumers to smoke in stealth mode.
          • Grow your own: Cannabis consumers can cultivate their own plants at home, and even control the process from their smartphone.
            • As CBD consumption grows, many industries will need to decide to disrupt, or be disrupted.

              Several other cannabinoids have also been discovered, but they have yet to be researched in depth—which means the investment potential of CBD could be just the beginning.

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Ranked: Emissions per Capita of the Top 30 U.S. Investor-Owned Utilities

Roughly 25% of all GHG emissions come from electricity production. See how the top 30 IOUs rank by emissions per capita.

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Emissions per Capita of the Top 30 U.S. Investor-Owned Utilities

Approximately 25% of all U.S. greenhouse gas emissions (GHG) come from electricity generation.

Subsequently, this means investor-owned utilities (IOUs) will have a crucial role to play around carbon reduction initiatives. This is particularly true for the top 30 IOUs, where almost 75% of utility customers get their electricity from.

This infographic from the National Public Utilities Council ranks the largest IOUs by emissions per capita. By accounting for the varying customer bases they serve, we get a more accurate look at their green energy practices. Here’s how they line up.

Per Capita Rankings

The emissions per capita rankings for the top 30 investor-owned utilities have large disparities from one another.

Totals range from a high of 25.8 tons of CO2 per customer annually to a low of 0.5 tons.

UtilityEmissions Per Capita (CO2 tons per year)Total Emissions (M)
TransAlta25.816.3
Vistra22.497.0
OGE Energy21.518.2
AES Corporation19.849.9
Southern Company18.077.8
Evergy14.623.6
Alliant Energy14.414.1
DTE Energy14.229.0
Berkshire Hathaway Energy14.057.2
Entergy13.840.5
WEC Energy13.522.2
Ameren12.831.6
Duke Energy12.096.6
Xcel Energy11.943.3
Dominion Energy11.037.8
Emera11.016.6
PNM Resources10.55.6
PPL Corporation10.428.7
American Electric Power9.250.9
Consumers Energy8.716.1
NRG Energy8.229.8
Florida Power and Light8.041.0
Portland General Electric7.66.9
Fortis Inc.6.112.6
Avangrid5.111.6
PSEG3.99.0
Exelon3.834.0
Consolidated Edison1.66.3
Pacific Gas and Electric0.52.6
Next Era Energy Resources01.1

PNM Resources data is from 2019, all other data is as of 2020

Let’s start by looking at the higher scoring IOUs.

TransAlta

TransAlta emits 25.8 tons of CO2 emissions per customer, the largest of any utility on a per capita basis. Altogether, the company’s 630,000 customers emit 16.3 million metric tons. On a recent earnings call, its management discussed clear intent to phase out coal and grow their renewables mix by doubling their renewables fleet. And so far it appears they’ve been making good on their promise, having shut down the Canadian Highvale coal mine recently.

Vistra

Vistra had the highest total emissions at 97 million tons of CO2 per year and is almost exclusively a coal and gas generator. However, the company announced plans for 60% reductions in CO2 emissions by 2030 and is striving to be carbon neutral by 2050. As the highest total emitter, this transition would make a noticeable impact on total utility emissions if successful.

Currently, based on their 4.3 million customers, Vistra sees per capita emissions of 22.4 tons a year. The utility is a key electricity provider for Texas, ad here’s how their electricity mix compares to that of the state as a whole:

Energy SourceVistraState of Texas
Gas63%52%
Coal29%15%
Nuclear6%9%
Renewables1%24%
Oil1%0%

Despite their ambitious green energy pledges, for now only 1% of Vistra’s electricity comes from renewables compared to 24% for Texas, where wind energy is prospering.

Based on those scores, the average customer from some of the highest emitting utility groups emit about the same as a customer from each of the bottom seven, who clearly have greener energy practices. Let’s take a closer look at emissions for some of the bottom scoring entities.

Utilities With The Greenest Energy Practices

Groups with the lowest carbon emission scores are in many ways leaders on the path towards a greener future.

Exelon

Exelon emits only 3.8 tons of CO2 emissions per capita annually and is one of the top clean power generators across the Americas. In the last decade they’ve reduced their GHG emissions by 18 million metric tons, and have recently teamed up with the state of Illinois through the Clean Energy Jobs Act. Through this, Exelon will receive $700 million in subsidies as it phases out coal and gas plants to meet 2030 and 2045 targets.

Consolidated Edison

Consolidated Edison serves nearly 4 million customers with a large chunk coming from New York state. Altogether, they emit 1.6 tons of CO2 emissions per capita from their electricity generation.

The utility group is making notable strides towards a sustainable future by expanding its renewable projects and testing higher capacity limits. In addition, they are often praised for their financial management and carry the title of dividend aristocrat, having increased their dividend for 47 years and counting. In fact, this is the longest out of any utility company in the S&P 500.

A Sustainable Tomorrow

Altogether, utilities will have a pivotal role to play in decarbonization efforts. This is particularly true for the top 30 U.S. IOUs, who serve millions of Americans.

Ultimately, this means a unique moment for utilities is emerging. As the transition toward cleaner energy continues and various groups push to achieve their goals, all eyes will be on utilities to deliver.

The National Public Utilities Council is the go-to resource to learn how utilities can lead in the path towards decarbonization.

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The Road to Decarbonization: How Asphalt is Affecting the Planet

The U.S. alone generates ∼12 million tons of asphalt shingles tear-off waste and installation scrap every year and more than 90% of it is dumped into landfills.

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Road to Decarbonization - How Asphalt is Affecting the Planet

The Road to Decarbonization: How Asphalt is Affecting the Planet

Asphalt, also known as bitumen, has various applications in the modern economy, with annual demand reaching 110 million tons globally.

Until the 20th century, natural asphalt made from decomposed plants accounted for the majority of asphalt production. Today, most asphalt is refined from crude oil.

This graphic, sponsored by Northstar Clean Technologies, shows how new technologies to reuse and recycle asphalt can help protect the environment.

The Impact of Climate Change

Pollution from vehicles is expected to decline as electric vehicles replace internal combustion engines.

But pollution from asphalt could actually increase in the next decades because of rising temperatures in some parts of the Earth. When subjected to extreme temperatures, asphalt releases harmful greenhouse gases (GHG) into the atmosphere.

Emissions from Road Construction (Source) CO2 equivalent (%)
Asphalt 28%
Concrete18%
Excavators and Haulers16%
Trucks13%
Crushing Plant 10%
Galvanized Steel 6%
Reinforced Steel6%
Plastic Piping 2%
Geotextile1%

Asphalt paved surfaces and roofs make up approximately 45% and 20% of surfaces in U.S. cities, respectively. Furthermore, 75% of single-family detached homes in Canada and the U.S. have asphalt shingles on their roofs.

Reducing the Environmental Impact of Asphalt

Similar to roads, asphalt shingles have oil as the primary component, which is especially harmful to the environment.

Shingles do not decompose or biodegrade. The U.S. alone generates ∼12 million tons of asphalt shingles tear-off waste and installation scrap every year and more than 90% of it is dumped into landfills, the equivalent of 20 million barrels of oil.

But most of it can be reused, rather than taking up valuable landfill space.

Using technology, the primary components in shingles can be repurposed into liquid asphalt, aggregate, and fiber, for use in road construction, embankments, and new shingles.

Providing the construction industry with clean, sustainable processing solutions is also a big business opportunity. Canada alone is a $1.3 billion market for recovering and reprocessing shingles.

Northstar Clean Technologies is the only public company that repurposes 99% of asphalt shingles components that otherwise go to landfills.

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