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You've probably never heard of flax fuel. But Toronto is using it to power city transit vehicles. The local Steam Whistle brewery uses flax fuel, and so does the Rogers Centre. Flax fuel can operate in any diesel engine and emits no greenhouse gases. It's a clean alternative to petro-diesel, and it even competes on price.

Flax fuel is the brainchild of Jon Dwyer, a 29-year-old green energy entrepreneur. Like many people his age, he's passionate about environmentalism and sustainability, and he wants the work he does to reflect his values. He also thinks the environmental movement has got it all wrong. Environmental initiatives will never succeed so long as they depend on government subsidies, he believes. So when he set out to start a business, he went in search of a renewable fuel source that wouldn't require government subsidies, and a technology that works. "Our goal is to have an innovative product that's cheaper," he says.

Flax fuel may not revolutionize the world. But Mr. Dwyer typifies a new way of environmental thinking: pragmatic, optimistic, business-minded. "We want to show that you can be an environmentalist and a good business person as well."

Mr. Dwyer's mini-factory, located on Toronto's Port Lands, is a model of efficient low-tech engineering. It takes flax seed (of which Canada has an abundant supply) and turns it into three products: flour, biodiesel and animal feed. The flour is used to enrich a variety of foods with omega-3, a fatty acid that's prized for its nutritional benefits. The animal feed also contains omega-3. Companies like Loblaws are betting big on more nutritious, healthy foods, and Mr. Dwyer sees big potential for omega-3 beef and chicken.

The capital funding for Flax Energy comes from private backers. "The government is the worst shareholder in the world," says Mr. Dwyer, whose business is subsidy-free, a rare status for green industry in Canada. In its initial year of production, the company did $4-million in sales and turned a healthy profit. He's convinced he's found a promising niche – plenty of room to grow, but too small to attract agri-giants like Cargill.

All around the world, renewable green schemes, subsidized with vast amounts of public money, have crashed and burned. Germany has spent more than €100-billion on solar subsidies, with next to nothing to show for it. Another notorious example is ethanol, a biofuel derived from corn, which by law has to be blended into gasoline. The ethanol mandate has driven up both food and gas prices, and makes no sense environmentally. Even Al Gore has apologized for supporting it. (The corn lobby loves it, though.)

As environmentalist Bjorn Lomborg wrote in the Financial Times this week, green energy is not yet ready to take over, either economically or technologically. Rather than making people pay more for technologies that haven't panned out, "We need to focus on cheaper technologies for the future. If we could make green energy cheaper than fossil fuels, everyone would switch."

The environmentalists who will change the world are not the ones who believe that business is a dirty word and capitalism is evil. They're the ones who understand how things actually work. They aren't fooled by mirages like electric cars, because they understand that electric cars, from the paint on in, are made of oil. "I'm not anti-oil," Mr. Dwyer says. "Oil created the middle class. Until we create alternatives to it, we shouldn't criticize."

Smart green thinking and common sense will solve many of the world's environmental problems. And people who know something about engineering, finance, economics and manufacturing will make a lot more difference to the planet than people with empty slogans and fashionable degrees in sustainability. The environmental movement desperately needs to be reclaimed from the doom-mongers and extremists who have done their best to push it to the brink of irrelevance.

As one disillusioned B.C. environmentalist wrote me recently, "There are many here who would make a valiant effort to chain themselves to a tree, but make little effort to get up every day and work at a job that may make a difference." I have no idea how Jon Dwyer's green business will pan out (although having met him, I'd say he will definitely succeed at something). But I do know we need more people like him.