Innovation

The innovation of Tradewater is focused on four key areas: business model, small scale aggregation, destruction technology, and data analysis. First, the business model is focused on the destruction of two specific ozone-depleting gases as a means of protecting the ozone: methane, and refrigerants. Tradewater is the sole company in the United States with this primary focus. As companies have become more environmentally conscious and are required by regional cap and trade market regulations to purchase offset credits, Tradewater has emerged as a for-profit private company with the primary goal to meet that demand through its innovation.

“I think in general, (what’s innovative about Tradewater) is the way that we go about doing the work,” said Director of Market Development Kirsten Love. “So with these refrigerants, they were banned from production via the Montreal Protocol in 1995 but there were no end of life solutions...when they banned the production, they assumed that we had already taken on the impact of these refrigerants. We call them 'forgotten refrigerants.' They're scattered all over the world, sometimes in really small quantities...that small scale aggregation is very key to what we do.”

Other companies also focus on reducing greenhouse gases but do not focus on the destruction of the gases because so many of these greenhouse gases are contained in small quantities across vast distances. Therefore, the acquisition and destruction of these materials on such a large scale is incredibly time-consuming and labor-intensive. Aggregation, through a focus on capturing the small scale gases, is therefore incredibly important to Tradewater.

“For example, if you, for whatever reason, have a can of refrigerant in your garage, even just one can, we will take it and then we aggregate that on the back end,” Love said. “So, we create a larger impact. So I would say...focusing on these ozone-depleting substances which are not typically a focus, but they're extremely important to preventing runaway climate change.”

Innovative technology was also required to create such a successful model for greenhouse gas destruction. The Tradewater team had to create massive kilns that could superheat these gases. To properly break down these substances, these kilns must reach anywhere from 760 to 1200℃, thus there is a massive engineering and production undertaking in creating this process.

“The materials are under different protocols for their destruction,” Love said. “One, they have to be approved by protocols that have been set forth and the requirement is that the destruction process has to be 99.99% effective in terms of destroying them...The molecules break down and the gases are destroyed with very little byproduct. But, all of our carbon offsets and all of the impact that we quantify reduces from the overall impact.”

Finally, Tradwater is innovative when it comes to its focus on data and analytics as a driver for the business. Data appears in many forms in this company, from modeling to market analysis, but it is central to the operations and aided in the ability to expand into three continents.

“We're a very data-driven company,” Love said. “Everything we do we like to make sure we have taken full advantage of any data that's presented to us, make sure we do our due diligence and research and bring all the variables together before you make decisions. But a couple of key ways that advanced data analysis helps us in this work is being able to identify where these pollutants might be. So we collect data and do some modeling to understand where we might be able to find the refrigerants and how we can go after acquiring it in the most cost-effective manner.”

Beyond its own operations, Tradewater also has increased the scope of its focus to providing data for small businesses and consumers. The company finds it important for everyone, not just large corporations, to understand their carbon footprints.

“We work with a number of different brands, but we also have other value-added services, such as helping them to understand their carbon footprint,” said Love. “And no matter how complex their operations are or their supply chain might be, we can help them to understand their carbon footprint and help them to figure out ways or areas they can reduce and how they can manage that carbon footprint in a better way. We also do the same thing with refrigerant management and understanding how companies can understand the inventory of the refrigerant and when they should replace it or how they should replace it, and the impact they can have and then even in the individual sense.”

Tradewater features carbon footprint calculators on its websites in partnership with CoolClimate to provide the consumer with accurate data on their carbon footprint. Tradewater is also expanding these services by offering a business calculator as well. Here, companies of any size can understand the company's environmental impact without the necessity of resources, funds, consulting firms, or full sustainability teams.

These four innovations are key to both the success and impact of Tradewater.

Inspiration

The idea behind Tradewater began in 2012 during a California cap and trade market conference when CEO and co-founder Tim Brown heard about ozone-depleting substances as eligible credits for companies to purchase to offset carbon footprints. The area piqued his interest so great that he went home and began buying refrigerants online to explore how to destroy them properly, who to partner with, and how he could achieve the end goal.

“He was very intrigued by the notion of creating a for-profit company to address environmental or social issues because he felt a little bit limited in the private sector and being able to scale and to find funding to move these things ahead and so...all the revenue we use we can invest right back into the projects and we don't have to go out and get grants to make sure that the work happens,” Love said.

Brown went on to found his own firm Wabashco and began to realize the potential to scale his company even further. Finally, in 2016 he partnered with co-founder and CFO Gabriel Bankier Plotkin to create an innovative firm for a growing market.

Beyond profitability, Brown, and Plotkin also sought to develop a company that was also focused on creating social change. They understood that climate change affects all of us, but it affects certain communities even more. Also central to their mission was the drive to ensure their company was a diverse and equitable environment that brought in talent that aligned with their vision.

“I'm a young black woman working in the environmental space which is a little bit of a rarity,” Love said. “And it truly has always been a part of the value and mission and vision of our co-founders to create a company that was not just environmentally responsible...also economically responsible.”

This focus became incredibly relevant in 2020 with the Black Lives Matter movement becoming mainstream in response to the death of Geroge Floyd. The company was driven to respond, as it felt a responsibility as a company seeking to create social change.

“It's one thing to have those values within yourself and to let those live in what you do, but that's not enough,” Love said. “You also have to speak about it and you have to live it out in a way that you are helping to educate others and you're helping to bring additional awareness to these causes...we have an opportunity to bring more awareness and to take a stance and to show people that you can do business in a way that is good for all aspects and address social justice issues at the same time.”

Tradewater is inspired by a climate crisis that necessitates a response, but the culture and the mission of the company are focused on wholesale social change with a specific focus on climate change. However, to separate one from the other would, in the minds of Tradewater, would be to leave a job unfinished.

“It's ingrained in everything, in how we asked for people to work with us, how we hire, how we select the communities we decide to work in, and everything,” Love said. “It's thought about and it's been really refreshing and really engaging and really cool to see, especially as a minority woman, a company walk the walk.”

Overall impact

Tradewater makes a near-direct impact in protecting the ozone from gases that deplete it and create runaway climate change. They do so through innovation and a constant focus on the aggregation of methane and refrigerant gases. Unlike other companies, this is the company's only goal and the only market it seeks to address.

Take for example the electric car company Tesla, that through the production of all-electric cars has reduced gas emissions by around 3 million tons. This is no small number, but through its focus on companies, small businesses, and the everyday consumer, Tradewater alone has destroyed nearly 4.35 million tons of CO2e and 1 million pounds of CFCs. For each CFC molecule destroyed by Tradewater, 100,000 molecules of ozone are saved. Over three continents, with 71 certifications from places like the American Carbon Registry, the California Air Resource Board, and VERRA, Tradewater has helped to invest over $28.8 million into communities.

Beyond the measurables, Tradewater has created a market that responds to the need to offset emissions and reduce impact. Even beyond the profitable market, the company is creating a volunteer market that allows individuals and small businesses to join the journey to combat climate change. By giving access to important information, Tradewater begins to include all of its partners in the solution.

“Climate change again impacts different communities at different rates,” Love said. “And so if we take care of the planet, it helps everyone but it definitely more so impacts those that are in areas and situations where they may not have the means to combat the effects of climate change. I feel like we're going to look back and it's going to be pretty cool that we allow individuals to be a part of a solution...and help to get rid of these really, really nasty greenhouse gases together.”

Business benefit

Tradewater provides benefits to businesses seeking to purchase offset credits. By destroying greenhouse gases, the company creates a net negative impact that is eligible for offset purchase. Beyond the cap and trade market, Tradewater aids in the safe disposal of refrigerants and methane to reduce overall environmental impact. Finally, Tradewater offers information to small businesses that are seeking to become more responsible and enter the fight to end climate change.

Social and environmental benefit

By reducing greenhouse gases that contribute to runaway climate change, Tradewater increases the potential time frame in which we all can address climate change. Reducing greenhouse gas emissions gives more time to create sustainable practices and economies. With its focus, Tradewater also limits the impact of climate change on marginalized communities, those most affected by a climate crisis with the least amount of resources to address it. Tradewater, through its focus on methane and refrigerants and its focus on social change, provides a wholesale response to a multi-faceted crisis.

Interview

Kirsten Love, Director of Market Development