By Ben Ratner

California public school teachers. Religious charities. New York police officers and firefighters.

What do all of these groups have in common? Investors representing them — who manage $1.5 trillion in retirees, current employees’, and others assets – are standing together and calling for strong rules limiting harmful methane emissions from the oil and gas sector. This level of outpouring – from diversified investors with holdings in the oil and gas industry – represents five times the support investors expressed for methane rules last year. A trend is emerging.

The investors, including the largest retirement funds in California and New York, issued a powerful statement in support of the president’s methane proposal aimed at cutting emissions nearly in half in a decade. A centerpiece is regulation of methane, the primary ingredient in natural gas, which has over 80 times the warming power of carbon dioxide in the first 20 years after it’s released and is responsible for 25 percent of the warming we are feeling today.

From their vantage point as long-term stakeholders, the “serious threat” methane poses to climate stability compels them, as fiduciaries, to support action to cut emissions and avoid near term threats to “infrastructure and economic harm that will weaken not only the companies we invest in, but the nation as a whole.” Market pressure like that is difficult to ignore.

Like many investors, they're taking the long view – reconciling their holdings in oil and gas companies with the threat that methane emissions pose to our climate, and pushing for cost effective national limits on methane. As they say: “What is truly needed is a strong federal standard on methane that will level the playing field for all companies.”

The investors behind this letter understand the double benefit of establishing national limits on methane. In addition to slowing the rate of warming and limiting the economic harm from climate change in this generation, it is an opportunity for industry to improve resource efficiency and deliver a badly needed win to start building public trust.

The Environmental Protection Agency (EPA) and Bureau of Land Management (BLM) should heed the call and move forward with a fact-based, comprehensive regulatory approach. Making the best practices of a few the standard practices of the many will unlock environmental returns while stamping out reputational risks for an industry at the crossroads. That’s a rare opportunity: it’s time to invest.

By Scott Wood

As summer officially gets underway, the 2015 EDF Climate Corps fellows are already off to the races seeking out energy and cost-saving opportunities for some of the world’s largest companies and organizations. Among those participating, we are pleased to place 13 fellows with private equity firms and their portfolio companies, the largest such cohort in a single summer, besting last year’s record of 12 fellows. This brings the grand total up to 57 EDF Climate Corps fellows who have worked in the private equity sector (including with portfolio companies) to date.

EDF Climate Corps fellows Yien Huang (left) and Jiamu Lu (right) collaborating at the fellow training

Since 2008, EDF has worked with the private equity sector to drive environmental results, beginning with a partnership with KKR & Co. L.P., and later with The Carlyle Group and Oak Hill Capital Partners. Resulting from this work was a suite of free tools designed to help firms identify and manage environment, social and governance (ESG) issues. EDF Climate Corps offers private equity firms a powerful resource that continues to deliver environmental benefits alongside real financial returns.

This year, as in past years, we continue to see a diverse range of participating companies and projects:

• In 2015, we welcome new hosts Guitar Center, NBTY (vitamin/food supplement supplier), Ortho Clinical Diagnostics (medical equipment manufacturer), Pharmaceutical Product Development, and Gelson's Markets (a grocery chain in southern California).
• Among returning companies, we’re excited to welcome back Floor & Décor, Philadelphia Energy Solutions, Avaya, and Caesar's Entertainment, the last of which was featured in episode 7 of the Showtime series Years of Living Dangerously (now available on Netflix, Hulu and Amazon Prime), which profiled the efforts of EDF Climate Corps.
• HCA Healthcare will also be returning, marking the company’s sixth straight year of participation.
• KKR & Co. L.P., Carlyle Group, and Hellman & Friedman will have fellows working at the firm level this year.

The work that these fellows will engage in this summer ranges from energy benchmarking and efficiency upgrades to demand response assessments and green revolving loan fund design. We’ve written previously about the myriad ways that fellows can add value both at private equity firms and portfolio companies and we’re excited to see new stories unfold this summer. Watch this space as well as our Climate Corps-specific blog, where fellows across a variety of sectors will share their experiences and accomplishments.

By Jason Mathers

Whether it’s a trailer, a container or a boxcar, better capacity utilization reduces the number of required freight runs and reduces truck emissions.

Despite the fact that most logistic professionals understand the value of building fuller truck-loads, recent research showed that 15–25 percent of U.S. trucks on the road are empty and, for non-empty miles, trailers are 36 percent underutilized.

Source: Homayoun Taherian, Cnergistics, LLC

Capturing just half of this under-utilized capacity would cut freight truck emissions by 100 million

tons per year – about 20 percent of all U.S. freight emissions – and reduce expenditures on diesel fuel by more than $30 billion a year (CELDi Physical Internet Project).

Nearly every company can improve trailer capacity utilization. Here are some real-life examples:

Kraft Foods: Because of the variety of products either cubing-out trailers (reaching the volume limit) or weighing-out trailers (reaching the truck weight limit), Kraft’s refrigerated outbound shipments were averaging only 82 percent of weight capacity. Kraft used specialized software to convert demand into optimized orders to maximize truck usage without damaging products. As a result, Kraft cut 6.2 million truck miles and reduced truck-load costs by 4 percent.

Walmart: The world’s largest retailer was able to increase the number of pallets shipped in a truck from 26 to 30 simply by side loading pallets.

Stonyfield Farms: This dairy product manufacturer worked with its clients to help them decrease the use of dunnage (inexpensive or waste material used to protect cargo during transportation), allowing the company to maximize the available space per trailer.

What’s your load factor on outbound trailers?

To improve trailer capacity utilization as well as source other ideas to create a more sustainable freight operation, download EDF’s free Green Freight Handbook.

 

By guestblogger

Zpryme talked with Ellen Bell, Senior Specialist, Environmental Defense Fund, for her thoughts on the role of buildings in a low-carbon future, the rise of microgrids, and how graduate students in EDF’s Climate Corps program get her excited about energy.

ZP: What do you look forward to the most in your business day?

Bell: We’re tackling something big—creating a new, low-carbon energy system—but we’re doing the practical, “in-the-weeds” work of doing it in individual buildings. Because of that, I look forward to two things: 1) working with great people—like building management and their engineering staffs, and 2) implementing our approach of finding the business case for operational efficiencies in energy management.

ZP: How does EDF fit into the Midwest energy ecosystem?

Bell: The Midwest has a large and thriving energy ecosystem of technology entrepreneurs, dedicated academics, innovative non-profits, utility partners, etc. While this network can be complex to navigate, all of these stakeholders are dedicated to working together to make the right decisions that will shape energy use in our changing world. EDF is proud to be a part of this alliance and dedicated to bringing our expertise through the Clean Energy program and our boots-on-the-ground talent in the form of EDF Climate Corps. We’re all about driving market adoption of the most effective solutions.

ZP: What is the role of commercial real estate in smart energy?

Bell: Buildings account for approximately 70% of all emissions in the City of Chicago, so focusing on decreasing those emissions makes environmental sense. But the infrastructure changes that lead to reductions also lead to fiscal savings that can impact how a building is marketed, how it interacts with its tenants and what those tenants may share with other offices across the country. So the commercial real estate industry has a unique opportunity to bring together the right stakeholders with the newest technology and best practices in energy management and tenant engagement—all of which can influence audiences with unparalleled reach.

ZP: Where do you see microgrids going in the next five years?

Bell: Because of concerns about reliability and the desire for more clean distributed generation, microgrids are poised for rapid expansion. Within the next five years, developers will experiment with a variety of business models that enhance the grid’s flexibility and efficiency.

ZP: What individuals (i.e. thought leaders) get you excited about energy?

Bell: Personally I am inspired every year by the brilliant graduate students who sign up to be part of our Climate Corps program. Individually they are all incredibly different, they come from diverse backgrounds that include degrees in everything from mechanical engineering to finance to urban planning, but they share a dedication to the desire to change the world through understanding how energy efficiency and making the business case for advanced energy management will transform not only the organizations where they spend the summer but the world at large. They apply a unique perspective to the questions at hand and I think of each of them as thought leaders because their fresh approaches to the issues and opportunities that face the energy industry drive the innovations that change the world.

Ellen Bell will be speaking at Zpryme’s ETS@chicago event, July 22-23 in Chicago. To learn more about the ETS@chicago and all of its speakers, please visit ets-chicago.com or contact info@zpryme.com.

This post originally appeared on Zpryme's Energy Thought Summit blog.

By Nancy Buzby

Last week’s papal encyclical on climate change galvanized those of us who already see responsible stewardship for the earth as both a moral mandate and business imperative. In the 184-page document, Pope Francis calls for a sweeping overhaul of political, economic and individual practices to halt the degradation of the environment and protect our planet for the long term.

The pope's sweeping vision is sure to prompt churches, people of faith and a whole range of organizations to rethink their actions with regard to use of energy, water and other natural resources. But already, religious organizations have been working quietly and steadily to effectively manage their environmental impact, in keeping with the established theological tradition of moral economic development and use of resources.

(Credit: Sacred Heart)

Take Gene Murphy of Prescott, Ariz., as a prime example of someone sitting at the intersection of religion, sustainability and business. As the business manager for the Sacred Heart Parish in the Diocese of Phoenix, Gene has developed scalable solutions for his church and school that could and should be replicated across all churches, schools and relevant organizations.

The church performed a clean energy retrofit covering lighting, windows, waste and solar power that dramatically reduced their utility spending from $94,500 a year to $37,000, or $157 in daily savings and transformed the 32,000 square foot school into a near net-zero building. The solar project alone reduces more than 230,000 lbs of CO₂ per year, and the building is now lit with 97 percent LED lights. Gene is already drafting a template for similar organizations to use in analyzing their opportunities in light of new technologies, regulations and methodologies.

At EDF, we see Gene and the Sacred Heart Parish as a real-life example of the kind of pragmatic stewardship the pope is calling for, and we got on the phone with him to get some deeper insights into the parish's transformation.

Q: In your view, how does fighting climate change relate to Catholic teachings?

Covered parking at Blessed Sacrament in Scottsdale (pictured) and Sacred Heart in Prescott doubles as solar panels used to power the parishes. (Ambria Hammel/Catholic Sun)

A: This is great timing with the pope’s encyclical. There are all sorts of different congregations that are doing this. It’s what we need to do. The next step is to get politicians to buy into it.

We take the St. Francis pledge. That has to do with praying and reflecting on our duty to God’s creation and to protect the poor and vulnerable, and to educate others on the causes and moral dimensions of climate change, teaching other parishes and affiliations how they contribute to climate change. Acts is one of the other tenets we use, to reduce the impact, and to advocate. I can prove, by my model, that it’s not only morally and ethically the right thing to do, but I can prove that it is pragmatic. I think in business terms. My return on investment is within 10 years and then it’s going to net my church $1 million.

Q: Why did you get into sustainability for your church?

A: I’m the parish business manager, so I’m always looking at the bottom line and how I can improve that bottom line. How can I improve the financial forecast for our budget at Sacred Heart church and school? One way is through efficiencies: we were able to capture $100,000 in rebates.

I’m always faced with budgets and shortfalls. I come from a retail background; I was used to running for-profit companies. I can’t add another sale or another item here. We’re already asking everything we can from our parishioners. I looked at it from a stewardship conception: I’m responsible for the dollars they give me; am I spending them the most prudent way?

Most people look at their utility bills as a fixed bill. I look at it as a variable. How can I make an investment that will pay off with greater dividends than what the bank will provide, paying 1-2% on deposits?

(Credit: Sacred Heart)

It’s not just about a great price; it’s about making a difference. Our solar company installed two free solar systems for Habitat for Humanity recipients. That’s huge when you’re talking about someone who makes under $15 an hour, who is not eligible for a regular home loan. Habitat makes it possible: we reduced [the homeowners'] electric bill by $100 or $125 a month. That’s huge when you’re a single mother with four kids.

Q: Having been a sustainability champion for some years now, what’s your reaction to the encyclical?

A: I think it’s wonderful. We all do have a responsibility to protect our earth. The pope has a master’s degree in chemistry; he’s highly educated. When they write the encyclical, they’ve done the research, they’ve done all the critical thinking. A lot of people don’t really believe in it, but if you look at the data, it’s very convincing. I’m not a scientist and I understand that there’s a problem.  You have to be proactive.

Q: Do you see this spreading to other parishes and non-Catholic organizations?

A: Absolutely. On June 30 we are having a lunch-and-learn, where we’ve asked for the electric companies to come in, and we have a couple of vendors with LED lights and solar. This is an educational forum and we’re going to be able to duplicate this throughout the United States. Mostly parishes in the Phoenix diocese will come, but we are inviting other people. There’s also going to be an interfaith event on Sept. 25th. Our efforts are going to be more than just Arizona. It’s going to affect the whole United States.

Q: If you were talking to another church or organization that wanted to leap into action, where would you suggest they start?

A: People ask me, ‘How much did it cost?’ I turn that question around to say, ‘How much did I save, is the question.’ What it has done for Sacred Heart is tremendous. We’ve expanded our ministries, our outreach programs to the community. There’s a bigger result.

Q: What obstacles might people anticipate if they want to follow your lead?

A: Of course. There’s always people that will be a Monday morning quarterback. In order for us to get this through, we had to make a presentation to the Diocese of Phoenix finance committee and the bishop had to sign off on the project. I showed them the math and the projections of what we could do. We had to make a compelling case that doing this is going to make a change on our bottom line to the positive and it has.

It’s a huge opportunity for us and the science does support it. We’re very committed to promoting earth stewardship. It’s one of our core tenets.

We’re in the process of working with Energy Star and getting an Energy Star rating. There’s a lot of tools and companies like that that really can help you understand this whole process.

There’s a bank partnership, if you qualify, called cost leveraging. If your electric bill was $2,000 a month and all these upgrades saved you 15 percent, you still would pay $2,000 a month until you satisfied the loan amount, through a special contract with the bank. There’s no money out of pocket. It’s a wonderful situation. As more Catholic churches come on board, these type of programs are going to be duplicated.

Q: What resources were most helpful to you?

A: It took me over three years and thousands of hours, but the more I saved, the more I got encouraged. If I would have done anything different I would’ve contacted an energy efficiency professional first so I wouldn’t have had to invest thousands of hours.

By Tom Murray

Freight transportation is the work horse of the global economy, ensuring that the products consumers want get on the shelves where and when they want them. With 70 percent of U.S. goods being moved by truck, freight is a key source of U.S. fuel consumption and corporate greenhouse gas (GHG) emissions. Today, freight also offers companies a key opportunity to drive us toward a lower carbon future.

In a Wall Street Journal op-ed with EDF President Fred Krupp, Pepsico Chairman and CEO Indra Nooyi voiced the company’s strong support of the new fuel efficiency and GHG standards for medium and heavy duty trucks released today by the U.S. Environment Protection Agency and Department of Transportation. Over the life of the program, these robust standards will cut fuel consumption in new trucks by 1.8 billion barrels of oil and reduce carbon emissions by one billion metric tons.

Leading companies like General Mills, Walmart and Anheuser-Busch have made reducing fuel use and emissions from freight a priority in setting their internal supply chain performance goals. But Pepsico’s willingness to step forward with this op-ed is a prime example of how companies can extend their leadership by aligning their public policy stances on with their sustainability goals – what EDF has been referring to as the business-policy nexus.

Freight affects all of us, but business is in the driver's seat

Freight transportation exists to serve companies that make or sell physical goods, from brands and manufacturers using trucks to bring in supplies and ship out final products, to technology companies needing trucks to deliver the hardware that powers their online services. While medium- and heavy-duty trucks only make up 7 percent of all vehicles on the road, they consume 25 percent of the fuel used by all U.S. vehicles.

Inefficient movement of goods wastes fuel, raises costs and increases environmental impacts. For firms like Pepsico, who maintain their own fleets, as well as those that contract out for freight moves, fuel is the single largest cost of owning and operating medium- and heavy-duty trucks. Truck fuel prices have increased 58 percent since 2009, a strong incentive for increasing the efficiency of trucks that move freight. Consumers are counting on businesses to solve this problem, as those costs are passed on to consumers. Through everyday purchases, the average U.S. household spends $1,100 a year to fuel big trucks. Strong standards can cut this expense by $150 on average a year by 2030.

Supporting strong truck standards is good business

Strong standards will help companies meaningfully reduce their supply chain costs and carbon footprint. In an update of analysis originally produced last year, EDF and CERES found that under strong heavy truck fuel efficiency standards, companies could see freight rates fall nearly 7% as owners of tractor-trailer units see their costs fall by over 20 cents per mile. A big consumer goods company, for example, could save annually as much as 3 billion gallons of fuel and $11.5 million in freight costs per year in 2030 by using newer trucks produced under strong truck standards.

Supporting strong truck efficiency standards is also an important way for companies to proactively mitigate risk. In a world with higher oil prices, we could see freight costs double; however, even in a scenario where oil prices remain low, savings would still be significant.

Standing against or keeping quiet about the proposed rule is essentially committing to higher long-term costs, more greenhouse gas emissions and greater fuel use than would be the case under stronger efficiency standards.

Strong truck standards are achievable now

Manufacturers continue to prove that strong standards are feasible now. Leading fleets are already achieving more than 10 MPG through a combination of driver techniques and leveraging current technology, and component manufacturers continue to bring efficiency solutions to the market each year.

Who will speak up next?

In addition to speaking out in the Wall Street Journal, in a press release issued on June 19th, Pepsico joined companies like Cummins Inc., Eaton Corporation, FedEx, Waste Management and IKEA in voicing their support for the standards to both the White House and the EPA.

Because freight touches many points along the corporate supply chain, companies have a responsibility to push for strong standards that minimize the environmental impacts of moving goods in the U.S. This is smart business, and it’s another piece of the climate puzzle we’re racing to solve. Every company voicing support will help us all move down the road towards a cleaner future.

Jason Mathers, Senior Manager, Supply Chain Logistics

To learn more about the heavy truck fuel efficiency and GHG standards, join EDF's Jason Mathers July 21st for our latest Business-Policy Nexus webinar, which will review the proposed standards and why companies should support these common-sense standards, which will not only protect our air quality and the climate overall, but save companies transportation costs.

Register now for this informative webinar

By Alissa Sasso

This installment of our Pillars of Leadership series explores Informed Consumers.

Sharing ingredient information with consumers is key to business leadership on chemicals. It can build consumer confidence, trust, loyalty – and market advantage. Numerous surveys (see here and here) and advocacy campaigns (see here) reveal that people want more ingredient information than is typically available today. The key to success in cultivating an Informed Consumer is providing product ingredient information that is comprehensive, accessible, and importantly, meaningful.

Consumers want to:

• Have easy access to consistent, reliable information
• Feel empowered when making purchasing decisions for themselves and their families
• Understand what they’re bringing into their homes
• Avoid adverse health and environmental impacts
• Trust that brands and retailers respect their interest in knowing product composition

How does a company cultivate an Informed Consumer? For starters, by sharing ingredient information on product packaging and online for products it makes or sells, with content that extends well beyond regulatory requirements. While packaging physically limits the amount of information that can be shared with consumers, online ingredient disclosure allows greater flexibility in terms of the extent and type of ingredient information, as well as how that information is accessed and presented.

Addressing three key questions fosters Informed Consumers:

• What chemicals are in the product: This means providing the specific identity of intentionally added ingredients as well as known contaminants. If a product contains a “free-of” claim, there should be verification that the product complies with the Federal Trade Commission’s Green Guides, guidelines to prevent green-washing. Further, free-of claims should be substantiated by a third party; even ingredients that are not intentionally added can show up as trace ingredients.

• Why these chemicals are in the product: This requires clear and understandable information about what function each ingredient serves.

• How to make meaning out of the information: The Informed Consumer leadership pillar is about transparency to the user. While the What and the Why form the core of the information a company shares with their customers, how this is presented is critically important as that defines accessibility. Product ingredient information needs to be easy to find on a manufacturer’s or retailer’s website, not buried. It is most helpful if information is also presented in a consistent manner across products and product lines.

Overcoming hurdles on the path to leadership

Available information: Companies themselves can have trouble finding the ingredient information that’s important to share with consumers. For example, manufacturers may not know the individual ingredients of a fragrance blend used in their products, yet this information can be critically important for consumers with allergies. Developing a Supply Chain Transparency plan – another core pillar of chemicals leadership – can enable effective systems for increasing information flows and expanding product ingredient information. While it may seem daunting to share your full ingredient list online, leadership companies like Seventh Generation and Beauty Counter are doing so today – and building both brand respect and market value along the way.

Managing an online platform: Online disclosure involves the transfer of internal data to a public-facing platform. To do this, a company may face software infrastructure challenges. Managing this effectively will require time, personnel, and financial resources. The site will need regular maintenance to ensure product information is always up-to-date, particularly if a formulation changes, and to accommodate increased data as the company gains more transparency into product ingredients.

Stepping up to leadership

To get started, companies need to assess what they know now and build a plan that outlines what information can be shared today and what information will be shared over time.

Building on our experience with retailers and suppliers, EDF has created guidance on best practices with examples for how to share ingredient information online. This new resource – EDF’s illustrated Rules of Online Disclosure – can provide a road map for improving your ingredient transparency.

See EDF’s Rules for Online Disclosure

 

 

By Ben Ratner

Pump jacks lined up in Oklahoma. (Credit: Kool Kats)

Six large European oil and gas companies recently announced a commitment to engage on climate policy, calling for a price on carbon. The now-emerging picture of their coordinated corporate talking points, however, leaves no doubt that promotion of natural gas is a core part of the group’s position.

Is this development a beneficial push to help the planet transition to a low carbon economy – or just another marketing campaign? The truth, so far, lies somewhere in between.

Here are the good, the bad and the ugly highlights of what we’ve learned over the past week and what it all means.

The good: Establishing a carbon price and cutting carbon dioxide emissions

Make no mistake about it: The world’s leading economies need to establish a price and limits on greenhouse gas emissions, and leadership from the private sector is instrumental in achieving that policy objective.

For large companies such as Shell, BP and Statoil to join forces and unequivocally state, as they now have, that a price on carbon should be a “key element” of climate policy frameworks is a refreshing boost to pre-Paris United Nations climate talks.

It is a potentially powerful validation that even some of the world’s largest corporate emitters see an upside to carbon pricing and will weigh in to make it a reality.

As to promoting natural  gas a solution, it is well documented that in many cases natural gas will replace coal for power generation – a shift already underway in the United States and partly responsible for driving down carbon dioxide (CO2) emissions.

The bad: Paying short shrift to natural gas’s Achilles heel

Notwithstanding the economic and carbon-dioxide benefits of coal-to-gas switching, there is a missing piece of the puzzle in the companies’ formulation to date.

One of the oil executives said “The enemy is coal.” Respectfully, that is incorrect. The enemy is climate pollution; coal is merely its most pernicious face.

Methane is natural gas’s Achilles heel. At close to 85 times more potent of a climate change forcer than carbon dioxide, methane emissions from the oil and gas industry undermine the very climate performance of natural gas that companies tout as a chief benefit relative to coal.

Indeed a recent report  found that the 20-year global warming potential of methane emissions from the global oil and gas sector have the same near-term impact as about 40 percent of total CO2 emissions from global coal combustion in 2012. And that’s on top of the carbon dioxide from burning the natural gas.

Fortunately, the bad methane story can be solved at little economic cost, and while creating jobs in the process. If the companies put a fraction of the effort of promoting gas into promoting methane solutions – including the regulations we need to establish basic environmental safeguards – this bad news story could disappear.

A bold methane action plan that all companies embrace, and that includes strong regulatory assurances, is the missing ingredient – the elephant in the room.

The ugly: A leadership shortage

But we have a problem.

American companies (think Chevron and Exxon) are among the most well-resourced and inventive oil and gas companies. With a large stake in natural gas, they share an interest with European corporate peers when it comes to promoting a carbon price that displaces coal and resolving the methane issue before it gets worse.

However, these “super majors” have remained conspicuously on the sidelines of the European companies’ efforts. They’re even signaling an intent to stay there even as peers move closer toward embracing a lower carbon future

It is a missed leadership opportunity, but one they can still seize.

By Jason Mathers

Here in the United States, the Environmental Protection Agency and the Department of Transportation will unveil new fuel efficiency and greenhouse gas standards for big trucks soon, according to the New York Times. At first glance, many companies might conclude that these new polices do not impact them. They’d be mistaken. In fact, they would be overlooking an enormous opportunity to cut costs while delivering real-world progress on sustainability.

The fact is that nearly every company in the United States is reliant on heavy trucks, which move 70% of U.S. freight. Brands and manufacturers use trucks to bring in supplies and ship out final products. Retailers and grocers count on trucks to keep the shelves stocked. Technology companies need trucks to deliver the hardware that powers their online services. Even Major League Baseball has turned its dependence on trucking into a quasi-holiday.

More efficient trucks matter to all business because they will cut supply chain costs. Last year, American businesses spent $657 billion dollars on trucking services. A lot of that money went to pay for fuel – the top cost for trucking, accounting for nearly 40% of all costs.

EDF and Ceres teamed up with MJ Bradley and Associates to assess how strong heavy truck fuel efficiency standards would benefit businesses that rely on trucking. In an update of analysis originally produced last year, we found that companies could see freight rates fall nearly 7% as owners of tractor-trailer units see their costs fall by $0.21/mile. Given that class 8 trucks logged nearly 170 billion miles last year, that $0.21 per mile savings, for example, equates to $34 billion dollars less in annual freight costs.

The magnitude of the savings in this update was consistent with our findings from last year; however, there are important changes in the underlying cost structure. In this new analysis we modeled significantly lower future U.S. diesel prices, in light of new fuel cost projections by the Energy Information Administration. We also updated the cost of more efficient equipment based on recent analysis by the International Council on Clean Transportation.

These savings add up for large shippers. A big consumer goods company, for example, could save over $10 million a year in 2030 by using trucking companies with newer trucks. As an added kicker, these trucks also would help meet the supply chain sustainability targets that leading brands are increasingly setting.

So, while your company may not own or make big trucks, cleaner, more efficient trucks hold a big opportunity for its triple bottom line.

By Suzy Friedman

There’s a new reason to celebrate your favorite sugar cookie. The Campbell's Soup Company has committed to fertilizer optimization in its sourcing areas in Ohio and Nebraska – which provide wheat for Campbell’s subsidiary, Pepperidge Farm – and the company will enroll an additional 70,000 acres into its fertilizer optimization programs by 2020.

Campbell's will work with EDF to create additional fertilizer optimization and soil conservation programs for farmers, and will deploy United Suppliers’ SUSTAIN platform in these sourcing areas to help ensure for farmers that changing their practices will not only reduce nitrogen runoff, but also protect yields and farm income.

With this announcement, the momentum for sustainable agriculture is higher than ever. Campbell’s is the latest company to participate in EDF’s Sustainable Sourcing Initiative, joining Walmart, Smithfield Foods, General Mills, and United Suppliers to make fertilizer efficiency and soil health the norm in U.S. grain production.

Committing to improvement

The company’s baseline data from 2012 revealed that Campbell's farmers used between 105 and 115 percent of recommended fertilizer rates.

But company executives know that nitrogen fertilizer not absorbed by plants converts into nitrous oxide, a greenhouse gas 300 times more powerful than carbon dioxide. So they made a goal to further reduce these percentages, help farmers’ bottom lines, and reduce their business risk at the same time. The more resilient their supply chain, the better they’ll fare in the face of a changing climate.

As part of a new collaboration with EDF and United Suppliers, Campbell's will develop a sustainability reporting system to track and measure the environmental and economic benefits of the project – and then expand fertilizer optimization into other areas.

The company will also work with EDF to conduct on-farm trials of tools that aim to help farmers optimize fertilizer use, to ensure that the tools really work on the ground.

Deploying SUSTAIN

A key part of Campbell’s new announcement is their collaboration with United Suppliers, a cooperative of locally owned and controlled agricultural retailers. United Suppliers’  SUSTAIN™ platform will be deployed across Nebraska and Ohio to offer farmers a set of tools and products that improve nutrient use while enhancing productivity.

The SUSTAIN model, which is also being used by General Mills, has the potential to bring fertilizer optimization practices to scale, since it works by training the go-to sources of information for farmers: agricultural retailers.

Authorized SUSTAIN retailers stand out in the marketplace by offering services to growers that are documented not only to improve efficiencies, save money and result in higher margins, but also promote environmental sustainability for agriculture.

Now that Campbell’s is expanding SUSTAIN, it’s easier than ever for retailers to help their customers address the ecological impact of farming and meet growing demand from food companies across the supply chain.

By Ben Ratner

Europe’s largest oil companies are reportedly working together on a policy strategy leading up to this year’s international climate talks in Paris. It’s nice to hear that some of the biggest players in the global oil and gas industry want to engage in solutions, but it remains to be seen if they will take the action needed to effectively tackle some of our most immediate climate threats – or to seize a major untapped opportunity.

That opportunity is methane. The highly potent greenhouse gas that’s been largely ignored until recently represents a solution for making real and immediate progress to slow warming. So will the group of oil companies sign on to tackle methane as a big part of its strategy, or are they going to ignore it?

Methane, the primary ingredient in natural gas, has over 80 times the warming power of CO2 and is responsible for 25 percent of the warming we are feeling today. That means tackling methane is an essential piece of the puzzle in making a real impact on greenhouse emissions.

A recent report by the Rhodium Group found that current global methane losses from oil and gas would be the seventh largest gas producing country, nearly equal Norway’s total 2012 production output, and packing the short-term global warming punch equivalent to about 40 percent of total CO2 emissions from global coal combustion. From an economic standpoint, these emissions account for 3.5 Trillion cubic feet of lost natural gas, and $30 billon of lost revenue. Without action, these methane emissions will increase more than 20 percent by 2030.

Given the enormity of the challenge, any credible industry effort must include methane. And, it’s an easy ask – a recent analysis found that it’s highly cost effective to reduce methane emissions, with an average net spend of less than one cent per MCF of gas produced needed to reduce methane emissions by 40 percent in the United States.

Here are three things we will watch to see if the new industry group gets serious about methane:

1. Scope – The companies should expressly affirm the importance of addressing methane alongside CO2, and recommend that policy mechanisms be appropriately broad, encompassing all material greenhouse gases.

1. Leadership – Whether in the U.S. or abroad, there should be a hand-in-glove fit – not a disconnect – between companies’ global rhetoric in international venues, and lobbying on the ground in key national venues. In the U.S., for example, there is an imminent rulemaking on methane by the Environmental Protection Agency. Supporting this effort is a practical and concrete opportunity for global oil and gas companies to drive down harmful emissions while cutting waste and earning trust.

1. Partnership – Several European companies are starting to show global leadership in their operations. For example BG, ENI, Total, and Statoil are participating in the UN-sponsored Oil and Gas Methane Partnership, a voluntary effort to improve transparency and accelerate best practices to reduce methane emissions. And Shell and others have studied methane emissions and joined the call for continuous leak detection. That said, companies like Shell and BP, which are not yet members of the OGMP but are reportedly participating in pre-Paris climate discussions, should prioritize any voluntary group efforts on joining the OGMP to demonstrate their commitment, rather than re-inventing the wheel.

There is a deep and urgent need for broad corporate leadership on climate in the run-up to Paris. The top 32 energy companies account for about a third of global greenhouse gases, according to a recent  Reuters report, yet the oil and gas industry has generally been either hostile, or mute, on the need for climate policy.

Against that challenging backdrop, the new effort by European companies has potential promise to achieve a much needed breakthrough. Now, the question is whether the leadership will be up to the task; including methane must be a big part of the answer.

This post originally appeared on the EDF Energy Exchange blog.

By Boma Brown-West

This installment of our Pillars of Leadership series explores Supply Chain Transparency.

You can’t act on what you don’t know. And if you can’t take informed action, you can’t innovate in smart and sustainable ways. A key step toward achieving industry leadership on chemicals is to gain a full understanding of the chemical supply chain.

Supply Chain Transparency informs a company’s decisions to effectively mitigate risk of current or pending chemical regulations (see here) and to efficiently allocate resources towards product innovation (see here). It also improves the data-set for product life cycle assessments, thereby yielding more firm-specific results. Above all, Supply Chain Transparency helps a company define and understand its starting point and its goals.

What does Supply Chain Transparency mean explicitly? EDF defines true transparency leadership as knowing the What, How Much, Why, and Who of the chemicals in one’s products.

• What are the chemical ingredients: Companies should strive for full transparency at the product level. This means knowing all the intentionally added chemicals, including those in chemical mixtures like fragrances, as well as known contaminants that occur in the making of the product.  As shown in our recent case study series, Seventh Generation moved to a different surfactant in its cleaning products to prevent contamination from 1,4 dioxane, a common residual contaminant in surfactant chemistries, recognized as a probable human carcinogen.

Achieving full transparency of the product prepares a company to respond to the changing regulatory landscape as well as shifting consumer demands.  Consider, for example, that many jurisdictions have begun restricting or banning the use of certain types of phthalates commonly used in fragrance mixtures. It makes good business sense to have a full picture of product composition.

Obtaining generic chemical names is a start to knowing what’s in products, but the unique numerical identifier given to each chemical substance – the CAS number, or CASRN – pinpoints exact chemical identity and helps avoid confusion when some chemicals are referred to by multiple generic names. The “What” is the linchpin of leadership on Supply Chain Transparency.

• How much is used: It is critical to know the concentration of chemicals in a product to understand potential exposure. Per-product data better informs the potential risk from the use of one product. Concentration information at the product category and portfolio level aid in assessing aggregate exposure, the risk of exposure to a single chemical via all possible exposure routes and sources. When dealing with How Much, EDF recommends that companies avoid concentration thresholds, or de minimis levels, that allow small amounts of purposefully added chemicals to go undisclosed. If a chemical is part of a product formula, it needs to be known.

• Why is an ingredient used: Understanding why a chemical is used in a product is about knowing its functional value. A chemical may be added as a preservative to prevent microbial growth, as a fragrance for scent, as a dye to impart color, and so on. Knowing this information also helps to identify those areas, such as product preservation, where diversity of safer ingredient options may be lacking. This in turn can spur research and development of new alternatives that can meet the functional requirements with reduced human or environmental health impacts. A company should gather functional data on all ingredients present in the final product.

• Who makes the ingredients: While a company’s direct suppliers, or Tier One suppliers, provide the first level of transparency into a product, they may not know the full formulation of a particular ingredient, such as a preservative or fragrance mixture. In addition, a product may contain chemicals of concern that occur as contaminants, such as 1,4 dioxane, mentioned above. To be fully knowledgeable, a company often needs to go beyond its immediate suppliers to secondary and tertiary sources, sometimes even to raw material suppliers. Building relationships with suppliers can improve ingredient transparency along the supply chain and facilitate innovative changes to formulations.

Overcoming hurdles on the path to leadership

Data management: Ingredient data management can be a laborious task, as companies often maintain complex product portfolios and large supply chains. An effective management process captures, stores, updates, verifies, and analyzes ingredient information. Paper-based data management continues to be a common initial step, particularly when financial resources are low or transparency initiatives are just getting off the ground, but it can be slow, tedious, and susceptible to human error.   Fortunately, there are a number of software-based data entry and analysis systems available for managing ingredient data. Existing systems come in various forms and levels of complexity. When making data management decisions, a company needs to be diligent in mapping its requirements against the available systems.  If a suite of internal and/or external management tools will be used, care should be taken to boost interoperability and connectivity. In a later publication, we will provide an overview of available systems, from those that inventory products and check regulatory compliance (e.g. WercSMART, SAP, IMDS) to those that also aid in toxicity analysis (e.g. SciVera Lens, Material IQ).

Trust: Companies want to protect their intellectual property (IP). In some sectors, chemical make-up can be a company’s primary IP. So, naturally, ingredient transparency requests can cause trepidation. When seeking to lead on Supply Chain Transparency, a retailer or a brand must navigate how to gain access to the information it needs to understand and mitigate its business risks while assuring suppliers that legitimate IP is protected. Third-party software-based data management systems featuring data security protocols can be useful tools in mitigating trust issues.

Participation along the supply chain: Getting timely participation from the full supply chain can be challenging, particularly the further upstream a company needs to go to collect the necessary data. It can often take time and persistence. When a company is not a large purchaser, convincing suppliers to divulge ingredient details can be tough, especially if the request is optional. Suppliers can also be overwhelmed by separate requests from different companies that ask for data in slightly different ways. The good news is that as more and more companies are seeing the business value in transparency, supplier requests for ingredient disclosure are becoming a common business practice.  As more suppliers face multiple requests for information, a greater emphasis is being placed on creating data uniformity that can benefit the entire supply chain (e.g. IPC-1752A, HPD, NSF 355).

At first blush, leadership on Supply Chain Transparency might seem daunting. But with a growing list of available resources, more companies can join the ranks of Method, Apple, Ford and Herman Miller who have paved the way. In the coming months, we will share more detailed guidance on how to successfully attain industry leadership on Supply Chain Transparency, including an exploration of some of the available tools and database systems.

Next up in our Pillars of Leadership blog series is Informed Consumers.

By Jason Mathers

It’s no secret that better trailer utilization reduces the number of required freight runs. Fewer trucks on the road means lower freight costs and reduced greenhouse gas emissions – an excellent freight sustainability strategy.

Despite the obvious benefits, recent research from Cnergistics has determined that 15 to 25 percent of the trailers on U.S. roads are empty. For the non-empty miles, these trailers are 36 percent under-utilized. Capturing just half of this underutilized capacity would cut emissions from freight trucks by 100 million tons per year – about 20 percent of all U.S. freight emissions – and reduce expenditures on diesel fuel by more than $30 billion a year.

Source: Homayoun Taherian, Cnergistics, LLC

If you’re serious about pursuing freight sustainability strategies, load optimization is a good place to start.

Following are just a few examples of load optimization strategies in action. More can be found in EDF’s Green Freight Handbook – a practical guide for developing freight sustainability strategies for business.

• Kraft Foods realized that, because of the variety of products either cubing out trailers (reaching the volume limit far short of the weight capacity) or weighing out trailers (the reverse), its refrigerated outbound shipments were averaging only 82 percent of weight capacity. To address the problem, Kraft used a software tool to convert demand into orders optimized to maximize truck usage without damaging products. As a result, Kraft cut 6.2 million truck miles and reduced truck-load costs by 4 percent.
• Walmart was able to increase the number of pallets shipped in a truck from 26 to 30 simply by side-loading pallets. This is one of many steps the retailer has taken to achieve its goal of doubling the efficiency of its transportation operations.
• Stonyfield Farms developed new policies related to lead-time and minimum order size to ensure that its shipping containers were full. As part of its approach, the company worked with its clients to help them decrease the use of dunnage (inexpensive or waste material used to protect cargo during transportation), allowing the company to maximize the available space per trailer.

When it comes to freight sustainability strategies, load optimization is relatively simple, since most of the factors that need to change in order to improve it are within your control.  To make a fast, measurable impact on greenhouse gas emissions, send your freight out in fewer, fuller loads.

By Boma Brown-West

Tens of thousands of chemicals are used to make the numerous products we use every day, yet regulatory oversight of the health and safety of these chemicals is severely lacking. Research has detected a number of these chemicals in our environment, homes, and bodies. At the same time, research has also linked a number of chemicals to disorders and disease such as asthma[1] and cancer[2]. Consumer concern is growing. With major retailers like Walmart, Target and CVS making public commitments to reduce the use of hazardous chemicals, chemical manufacturers and consumer product companies are hearing loud and clear the need for stronger policy solutions and market demand for safer chemical innovation.

EDF developed these case studies to highlight examples of innovative chemistries developed in response to demands for safer chemical ingredients in consumer products. The efforts of a leading brand and a chemical manufacturer – two ends of the consumer product value chain – are provided here.  We explore the motivation behind their product innovations and reformulations, what the innovations allowed the companies to achieve, and the impact of these innovations on their business and sector. These are not endorsements but rather an exploration of how companies are approaching safer chemistry innovation.

What We Discovered

A number of interesting results emerge from these case studies:

1. Products designed to better protect human health can be economically successful.
2. There is more than one way to resolve the same problem.
3. Getting innovations to the market requires cooperation across the supply chain. Sometimes it requires external forces to set the right marketplace conditions.
4. Reformulations can be cost-neutral despite changing suppliers and/or processing facilities.

A Snapshot of Each Case Study

 

AkzoNobel

In this case study we look at chemical manufacturer AkzoNobel’s work to create ingredients that have improved human health and environmental profiles. We learn how regulatory developments aided in the commercialization of AkzoNobel’s Dissolvine as a phosphate-free chelate in automatic dishwashing detergent. AkzoNobel collaborated with its customers and sought input from regulators to develop testing methods to examine Dissolvine’s biodegradability and human health profile. For the full case study, click here.

Seventh Generation

In this case study, we learn about Seventh Generation’s work to replace a common surfactant used in cleaning products, Sodium Laurel Ether Sulfate (SLES). Production of SLES generates the contaminant 1,4 dioxane, a probable human carcinogen[3], that is then transferred to products. Seventh Generation succeeded in replacing SLES with the non-ethoxylated surfactant Sodium Laurel Sulfate (SLS), which is not accompanied by the 1,4 dioxane contaminant. Seventh Generation’s efforts resulted in a better-performing product and maintained sales. After launch and continued public concern about 1,4 dioxane, competitors of Seventh Generation announced  their own plans to reduce 1,4 dioxane in their products. For the full case study, click here.

We will be updating our Behind the Label series of blogs and case studies in the coming months and we invite you to join in the conversation.

 

[1]Bornehag CG et al. 2004. The association between asthma and allergic symptoms in children and phthalates in house dust: a nested case–control study. Environ Health Perspect 112:1393–1397.
[2]Huff J (2007). "Benzene-induced cancers: abridged history and occupational health impact". Int J Occup Environ Health 13 (2): 213–21.
[3] See National Toxicology Program, International Agency for Research on Cancer, and U.S. Environmental Protection Agency

By Jason Mathers

There are many ways to reduce freight-related greenhouse gas (GHG) emissions. But which strategies make the most sense for you?

EDF’s Green Freight Handbook provides a framework to help you answer this question based on what initiatives will achieve the greatest environmental benefit in the least amount of time. The key is our Green Freight Diagnostic Tool.

Here’s how it works.  We focus on EDF’s five key principles for greener freight:

1. Get the most out of every move
2. Choose the most carbon-efficient mode
3. Collaborate
4. Redesign your logistics network
5. Demand cleaner equipment and practices

For each key area of potential, we list a series of simple questions designed to help you determine which strategies are the low-effort, high-return opportunities. You’ll need some data in order to answer the questions, but it’s a pretty easy exercise to start moving down the path toward a cleaner, lower-cost freight program.

Here’s a small sample from just one of the green freight diagnostic sections, "Get the most out of every move." As you can see, it explains the opportunity and allows you to measure the potential impact at a high level.

Question Opportunity Potential Benefit Can your customers be flexible about arrival dates to enable freight consolidation? With a transportation management system or TMS, companies can identify opportunities to hold orders for consolidation. Where feasible, and with the right incentives, companies can then send one larger shipment to customers instead of sending two smaller ones. Reduction of product shipping volume by up to 30 percent. Have you recently analyzed opportunities for balancing high density and low density products? If no, explore how you might be able to better balance weight and cube constraints. Options include matching internal freight or co-loading with a company with a similar need and transportation lanes. 20-30 percent net reduction in process and resource costs. Can you side load your pallets 90 degrees when loading them on the truck? Explore the feasibility of side loading pallets to enable the loading of more cargo per truck. This will be feasible only for fleets that cube out, but do not weigh-out. This approach will require changes to pallet construction and loading. 8-15 percent increase in truck productivity.

That’s just a small sampling.  Each of the five sections provides a comprehensive diagnostic assessment tool. Download the Green Freight Handbook to access the tool.

By EDF Staff

Where You'll Find Us in May/early June:

• Steven Goldman will be moderating a panel on water efficiency and Liz Delaney and Scott Wood will be attending the U.S. Department of Energy's Better Buildings Summit May 27th-29th in Washington, DC.
• On June 1st-4th, Kathleen Gill and Scott Wentzell will be attending the Sustainable Brands conference in San Diego, CA.

Look for us at these conferences – and let us know if you’ll be there so we can watch for you as well!

By guestblogger

By Kellen Utecht, Director of Sustainability, Phigenics

“Nothing is more useful than water; but it will purchase scarce anything; scarce anything can be had in exchange for it.” — Adam Smith

With California facing its worst drought conditions in its history, toxic algae blooms in Lake Erie, and water costs rising 33% since 2010, water’s value – both its actual costs and our perception of it – has been transformed since Adam Smith’s time. Companies today have a vested business interest in managing their water consumption. Since 2011, businesses globally have invested $84 billion dollars in water management projects.

Given that water for cooling makes up a significant portion of a building’s water use, adopting a portfolio approach to cooling water management program is one way companies can make meaningful impacts in reducing water consumption and improving energy efficiency.

Phigenics, an independent water management company, works with leading companies in diverse industries such as healthcare, universities, hospitality and retail to optimize water use in the built environment. In one powerful example, Walmart – with a portfolio of stores spread across the United States – made significant reductions in its water use and utility expense by implementing such a program.

Fragmented Approach Driving Higher Costs and Water Use

In 2008, Walmart found an opportunity to improve the performance of its 180 water-cooled U.S. stores. These stores had no engineering support on-site and no remote monitoring of cooling system performance. In addition, it had 15 different water treatment service suppliers, each with their own vendor report forms, different chemical strategies and their own proprietary equipment.

Assessing its portfolio of stores, Walmart found a lack of both vendor oversight and a standardized approach to cooling water management. This resulted in excessive water consumption due to low reuse of water and slow response time to leaks; decreased energy efficiency; and decreased useful life of assets. Furthermore, because of lack of a reporting system and access to real-time data, labor was being spent on maintenance issues as opposed to optimization.

In 2008, Walmart partnered with Phigenics to develop a new approach to cooling water management. Recognizing that developing a strategy to reach water reduction and costs goals at each individual site would be both time and resource-intensive, Walmart took a portfolio-based approach in an effort to create a company-wide impact and greatly improve the efficiency of water use across its water-cooled facilities. For companies seeking to optimize the performance of its cooling tower operations, the below framework has been a winning approach for designing and implementing a portfolio cooling water management program.

Water Management Framework

Gain Leadership Buy-in

 “We understand water is intrinsic to our mission of helping our customers save money and live better.” —Walmart Global Responsibility Report

The operation of cooling towers involves many different departments (more on this in the next section); without buy-in from a company’s leadership, getting support for a water management program may prove difficult. Corporate sustainability managers frequently cite two reasons to help build support for the design, investment and implementation of a program:

• The first is the attractive return on investment through reduced operational and capital expenditures in its portfolio’s cooling tower operation; and
• The second is a water management program’s alignment with existing corporate sustainability goals, such as combating water scarcity, being proactive stewards of water resources and promoting a healthy environment for consumers and employees.

Read about EDF and AT&T’s tool to help your company make the business case for efficiency upgrades

Water Management Program Team

Develop a Cross-Functional Cooling Water Management Team

Once a team secures buy-in from management, the program champion assembles a cross-functional cooling water management team. A team should include oversight by an independent water management expert and coordination with the local water treatment service representatives and water testing laboratories. Initially, the team develops an implementation plan based on the following steps and should meet quarterly to review progress. The program champion coordinates quarterly team meetings, monitors overall program progress and liaises with internal and external stakeholders.

Develop a Benchmarking Program

The program team’s first task is to develop program objectives and key results (OKRs). Some examples of OKRs used in Walmart’s program and those of other leading companies are:

• Optimizing the useful life of capital assets – key results are conducting an audit, developing a remediation protocol and/or developing a maintenance plan for each cooling tower.
• Reducing cooling water consumption by 20% overall and by 30% in water scarce areas – key results are increasing the portfolio’s cycles of concentration (i.e., how many cycles a tower can operate before flushing the system, aka blow-down), installing make-up and blow-down meters and wireless communication exchanges, and plotting the facilities on a water scarcity map to assess which face the greatest risk of water stress.

“We believe water is a location-specific issue, and we’ve made great progress in many water-sensitive regions. Walmart operates in 27 countries, all with varying levels of water stress, ranging from low to extremely high. We estimate that more than 20% of our operations are, or will be, located in regions facing high levels of water stress.” — Walmart

• Reducing operation/cooling tower expense by 20% – key results are reducing the amount spent on water treatment/1,000 gallons; reducing water, sewer and energy costs; and negotiating with water utilities for evaporation credits.
• Improve consumer and worker health and safety – key results include reducing and benchmarking quarterly positive tests for Legionella; and documenting achievements in hazard control.

Create a Performance Specification

Once the program’s OKRs have been set, the team creates a corporate cooling water system performance specification, which entails setting engineering and operational requirements for your facilities personnel and contractors. Developing the specification enables the team to standardize operating practices and water treatment services. Key sections of a performance specification include:

• Product and equipment specifications;
• Water quality standards — e.g., source and quality;
• Key performance indicators (KPIs) — e.g., cycles of concentration or water treatment cost per use;
• Test methodology requirements;
• Water treatment supplier requirements;
• A summary of roles and responsibilities; and
• A corrective action policy for noncompliance.

Develop Program Verification and Validation Strategies

A key step in launching a successful water management program is the development of verification and validation strategies.

Verification is the evidence that the plan is implemented accurately. For instance, if an organization wants to free up staff from some routine tasks so they can focus on higher-value activities, it can install water meters on its cooling water make-up and blow-down lines, to enable automatic monitoring of water consumption, which will inform your team if the plan is being implemented accurately.

Validation provides quantitative evidence about the effectiveness of the program. For example, take an organization seeking a quarterly snapshot assessment of its cooling water treatment plan. A team wanting highly accurate data and a minimum impact on labor would hire a credible third-party laboratory to benchmark its KPIs by conducting tests for typical cooling system efficiency metrics, such as cycles of concentration.

Key Components of a Water Management Program

Make it Smart

At this point, companies need to evaluate whether or not to make the program “smart” (i.e., providing remotely accessible, real-time data). A smart program may include investment in:

• A cloud based software platform specialized for cooling water management
• A standardized system for automatic sensor monitoring;
• Make-up and blow-down meters;
• Secure wireless data communications; and/or
• A standardized online service report for contractors.

By making the system smart, critical system sensor data is accessible and available to the team and other approved stakeholders through any Internet-connected device. The real-time data empowers the team to respond quickly to leaks and changes in water quality, while allowing it to utilize data analytics to enhance decision-making. It also assists in helping the team track progress towards operational OKR’s. For these reasons, Walmart made one of the largest investments in real-time monitoring equipment and software for cooling water systems.

State of Walmart Water-Cooled Store Operations, 2008 & 2015

Communicating and Celebrating Success

With the rise in awareness of water scarcity and the impact water has in people’s lives, an equally important step in this process is taking the time to engage with key internal and external stakeholders about the importance of managing water use. Quarterly milestone meetings, your company’s blog and social media channels are great opportunities to let others know about successes from your cooling water management program as well as highlight other opportunities for them to conserve water.

Clear Benefits for Walmart

Annual Gallons of Water Saved by Walmart's Implementation of the Portfolio Approach

Going back to our key example, Walmart, this portfolio approach represented a clear shift forward for cooling water management. Walmart is using data analytics to enhance its decision-making and drive accountability across its water-cooled facilities. Through the development and implementation of the approach outlined above, Walmart reduced water consumption by 25% per cooling tower, which equates to 660 million gallons of water and $4.4 million in total water and sewer savings portfolio-wide over the 6 years of the program. In addition, this approach increased the energy efficiency and useful life of Walmart’s assets.

Other companies can apply this proven approach to more responsibly manage facility water use across their portfolio of properties. This approach will help your company cut costs, reduce risk from shortages in water-stressed areas and further your company’s role as a water steward through communicating water and energy efficiency gains and best practices in smart cooling water management.

For more information regarding other best practices in facility water management, please visit http://www.smartwaterleadership.com.

Kellen Utecht is the Director of Sustainability for Phigenics. He is responsible for overseeing Phigenics’ corporate sustainability, engaging with clients on the topic of sustainability, and conducting key external stakeholder outreach. Kellen has a Master of Business Administration from the Walton College of Business at the University of Arkansas and Master of Public Service from the Clinton School of Public Service. He has served as a Sustainability Researcher and External Relations Committee Manager for The Sustainability Consortium, a Water Stewardship Researcher for WWF-Turkey and a small business development specialist for Peace Corps Bulgaria and the North Dakota Small Business Development Center. Kellen loves talking about water, data analysis and collaborative solutions. He can be reached at kutecht@phigenics.com.

Phigenics is an innovative water management company that was founded to optimize building water systems for safety and efficiency. Phigenics seeks to meet the increasingly complex needs of facility owners and managers to improve overall water safety, reduce operational (water, chemical, energy) costs and increase return on capital investments. Phigenics is focused on sustainability (water, energy, and worker and consumer health and safety) as a means for empowering its clients to be stewards of local water sources across their portfolio of facilities. It does this through providing guidance on best practices in water management via HACCP for Building Water Systems, developing metrics for driving accountability, and utilizing data analytics to enhance decision making.

By Maggie Monast

Mark Bittman’s recent New York Times op-ed, “Let’s Make Food Issues Real,” is a grim assessment of the current state of the food movement – in fact, he questions whether a food movement exists at all.

Bittman states that the lack of major change to government food policies means the food movement is not winning. “I’ll believe there’s a food movement when Hillary Clinton and Jeb Bush are forced to talk directly about food issues,” Bittman writes.

I’ll take that bet. With the drought in California threatening the nation’s produce and the other impacts climate change pose to our food supply, I think it’s likely that the next group of presidential candidates will discuss food issues on the campaign trail.

But even if politicians take up the banner of the food movement, new legislation should not be the sole indicator of success. Food companies are increasingly making changes to their products, practices, and sourcing in response to consumer demand. State policies and federal agency priorities are also shifting.

While not every change is ground-breaking and there is a need for continued improvement, when taken as a whole these changes signify a shift in momentum towards greater responsibility in our food system. We can see these forces coming together in the agriculture sector’s response to climate change, where farmers have a major role to play in both reducing emissions and adapting to the changes already underway.

Maggie Monast recently participated in an event to announce USDA's new climate strategy

Grains such as corn and wheat dominate U.S. agriculture. If grain farmers use nitrogen fertilizer inefficiently, then the excess can lead to water and air pollution.

The good news is the private sector is taking the lead in helping farmers avoid nitrogen pollution with solutions that keep fertilizer in the crops where it belongs, while saving farmers money, too.

Retail giant Walmart is urging its suppliers to improve fertilizer efficiency in the grain supply chain, andSmithfield Foods, United Suppliers and other companies are coming up with innovative solutions in response.

United Suppliers – a company that has a division to market fertilizer to locally controlled ag retailers – saw the writing on the wall and came up with a plan to enroll 10 million acres in efficient fertilizer practices, all while preserving its bottom line with an expanded line of products and services that are good for farmers, good for the planet, and good for business.

Carbon markets for crop production

In December 2014, the California Air Resources Board (ARB) considered, for the first time, a carbon offset protocol for U.S. rice growers, allowing them to earn additional revenue for reducing greenhouse gas emissions. This “rice protocol” would represent the first carbon offsets for crop-based agriculture, ever – and it would open the door for other crops to generate offsets as well.

The ARB will be voting on the protocol this June, and it is expected to pass. The first carbon offsets from rice will be issued later this summer, meaning farmers will be making money by making tangible reductions in their emissions.

EDF is also working to develop a nutrient management protocol which applies to rice, almonds and corn, and would decrease   emissions even more – and provide potential sources of revenue for farmers.

U.S. government on board

The U.S. Department of Agriculture (USDA) and the White House are bringing emissions reductions to scale through a new initiative to partner with farmers to address climate change threats. I attended Secretary Vilsack’s announcement a few weeks ago, and he stated the USDA’s new goal to reduce emissions by over 120 million metric tons per year – the equivalent of taking 25 million cars off the road.

USDA’s commitment to a numeric reduction goal puts the agency on record to come up with creative partnerships that will deliver real, measureable greenhouse gas reductions – exactly the approach we need.

Reasons for optimism

The food movement encompasses an array of important health, social, economic, and environmental issues. We have a long way to go and many of the issues that Bittman highlights will need increased attention and resources in the coming years. But there is plenty of evidence to show that our food system is changing for the better, and plenty of reasons to be optimistic.

By Boma Brown-West

Successful business outcomes require strong and continuous commitment and support from company leaders. As with any change initiative, modifying how a manufacturer selects the ingredients it uses or how a retailer selects products requires time and resources, and infrastructural and behavioral adjustments. In our previous blog in this series, we identified five 'pillars' that are critical to attaining industry leadership on safer chemicals.

The first pillar, Institutional Commitment, is essential in ensuring leadership support for business transformation.

Institutional Commitment to safer chemicals frames a company’s journey, builds internal champions, and sets accountability for the journey at every level of the organization. In a committed company, action ripples throughout the organization; company executives set top-level goals that are reinforced by middle management in a way that empowers employees in every business function to make the transformation successful through their own daily operations. It’s about true integration of the new safer chemistry philosophy into everyday business.

Corporate Chemicals Policy

The most effective tool in jump-starting and sustaining Institutional Commitment for safer chemicals is a written corporate chemicals policy. A strong chemicals policy begins with an overarching vision of the transformations the company wants to achieve in its chemicals management and ultimately product portfolio. A vision statement is aspirational and conveys the company’s desire to take a leadership stance, for example Seventh Generation’s statement, “To Inspire a consumer revolution that nurtures the health of the next seven generations.” The scope of the policy, i.e. whether the policy will apply to all products made (or sold) or to a subset of such products, should also be made clear.

The company’s specific objectives for attaining leadership on safer chemicals are the meat of a corporate chemicals policy. In our previous blog, we identified supply chain transparency, informed consumers, and a safer chemicals action plan as the most critical leadership initiatives for a company to undertake. The written chemicals policy lays out the top goals for these initiatives. Thus, a chemicals policy institutionalizes a company’s commitment to lead on safer chemicals while also articulating what the company wants to achieve. The policy is also powerful in helping suppliers understand where the company wants to go and how the supply chain will be involved. In the upcoming weeks, we will share EDF’s model chemicals policy, our vision for leadership commitments.

Who and what should be involved in the crafting of a corporate chemicals policy? At a high level, the crafting of a strong policy is an iterative process, perhaps shepherded by a company’s sustainability team, and involves gaining input from key business functions, understanding current business processes and resources, and revising ideas of what is typical, attainable and aspirational. In a retail company, merchandising, sourcing, compliance and legal are among the strategic functions to include in policy development. In a brand or product manufacturing firm, input is necessary from all business functions impacted by the policy including R&D, product design, materials procurement and technical support staff (including those who review material performance and those who review health impact), as well as legal and compliance.

It is also useful when crafting a chemicals policy to consult the advocacy community, whether through direct engagement or through landscape research. Some organizations may provide additional subject matter expertise, others greater insight into consumer needs. In a later publication, EDF will dig more deeply into this topic.

Ultimately, for the policy to gain traction in the organization, it needs to be endorsed by the corporate executives who oversee the business functions that will be directly involved in applying the policy. Their management teams will be crucial in communicating to employees and suppliers how the policy will impact existing business processes and what will be expected from them in making the policy successful.

Hurdles on the Path to Leadership

Sparking and sustaining Institutional Commitment is not easy. It can be difficult to catalyze change in a corporation, particularly a large, established company that has been profitable in its existing way of doing business. The first step in sparking commitment is belief from those behind the transformation. If they believe what they’re doing is right for the company and will bring value, that belief reverberates to upper management and increases the likelihood of gaining their support and commitment to altering business processes.  One of the most useful strategies in fostering alignment is to see the topic through the eyes of a particular business function. How would the new goals affect primary objectives? Where are synergies? What aspects resonate best with their daily operations?

Another potential hurdle is allowing perfect to be the enemy of good. The first draft of a policy is not going to look like the final version, and that’s okay. Iterative conversations with stakeholders will flesh it out. Likewise, over time as the policy is implemented and insights are gained, new aspirational goals can be identified and integrated into the policy.

Conclusion

Institutional Commitment is an essential step towards attaining leadership on safer chemicals. It promotes goal embedment and alignment, boosts employee empowerment, sets internal accountability and articulates a vision to both the company and its suppliers. The next piece in our Pillars of Leadership blog series will tackle the value, hurdles, and mechanisms of action for attaining leadership on Supply Chain Transparency. Stay tuned!

By Tom Murray

A company’s public statements matter– they can influence consumer choice, sway public policy decisions and demonstrate leadership on important issues. But in terms of actual change, it’s where a company puts its money that really matters. This week, Bank of America spoke with both its voice and wallet: At its shareholder meeting last week, the bank announced a new coal policy that continues the company's commitment to reducing its exposure to coal extraction companies and accelerating the transition from a high-carbon to a low-carbon economy.

According to BoA, its portfolio has grown to favor renewable energy over coal by a ratio of more than three-to-one. That’s an important step forward toward a clean, low-carbon energy future. And, it’s one that builds on moves by other institutions, like the recent news from Goldman Sachs about how the company is looking to divest some of its mining interests and Citi’s recent 10-year, $100-billion commitment towards investments in areas like energy efficiency, renewable energy, green affordable housing and climate change resiliency projects.

Investors are seeing the terrain change beneath them – from upcoming regulations like the EPA’s Clean Power Plan and federal regulations on methane emissions from the oil and gas sector, to consistently lower natural gas prices, which undercut coal’s prior price advantage over other power sources – and beginning to bet on a future that’s powered by lower-carbon options.

More of this type of corporate leadership, including metrics and timelines, is what's needed to help make the leap from today’s polluting energy system to tomorrow’s thriving, clean energy future.

Further reading:

• 4 Ways to Invest in the Low-Carbon Economy
• 2015: A Year of Business and Policy Action on Climate