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How pine beetles can predict the future of climate change

Published July 02, 2014
How pine beetles can predict the future of climate change

This article originally appeared at Ensia.

If you’ve ever wondered how much little things really matter, consider the mountain pine beetle. Roughly the size of a grain of rice, the glossy black insect lives only about a year, but a female beetle can travel as far as 30 miles to find a pine tree, where its larvae can hatch and eat the inside of the bark. A throng of beetles can ravage a pine as tall as an eight-story building, as the tree first oozes sap, then its needles turn rusty red.

In the past decade, in the pine forests that bristle across the U.S. West and Southwest, from Alaska to southern California, millions of acres of pines have died in one of the worst pine beetle epidemics anyone has seen.

Foresters have suspected for more than two decades that an explosion of insects was in the cards, based on predictions for global warming. Warmer weather can give beetles and other insects a chance to expand into new territory in frigid northern climes and at high altitudes. As early as 1991, managers with the U.S. Forest Service began discussing how to prepare for more widespread pest epidemics. 

But global predictions for climate change, although consistent on large-scale trends, weren’t specific enough to discern the variations in temperature and terrain (such as at different elevations along a mountain slope) that can make a difference to beetles. Global climate models divide the planet into a giant grid and lump anything the size of Yellowstone National Park into a pixel or two.

“The stuff that will end up mattering to beetles, a lot of that is going to be lost on the scale of those models,” said James Powell, a mathematics professor at Utah State University who uses mathematical simulations to predict how changes in climate affect plants and insects. 

The results help answer practical questions — such as how drought might spread across Africa or how bad Lyme disease could become in Maine as warmer winters let deer ticks march north.

In the past several years, advances in both climate science and supercomputing have begun offering people such as Powell a more intricate picture of the future: models of climate change that zoom in to hyperlocal scales. In 2011, the University of Idaho unveiled a model that estimated future climate for areas as small as 2.5 miles over the entire continental United States.

When combined with years’ worth of field data on trees and temperatures gathered from a range of sites from southern California to northern Washington, this is enough information for Powell and his collaborator, U.S. Forest Service entomologist Barbara Bentz, to begin mapping the places where pine beetles may expand across the West. They will give the results to forest and park managers so they can start planning how to respond to future beetle attacks.

Mountain Pine BeetleSuch small-scale models are being used around the world to predict in great detail how climate change will affect the basics of life. It’s a process called “downscaling” — a rapidly emerging area of research. Scientists begin with one or more of the dozens of global climate models and real-world data on weather and topography. They use complex computer simulations, statistical calculations or both to pinpoint their predictions to the realm of the particular. The results help answer practical questions — such as how drought might spread across Africa, how bad Lyme disease could become in Maine as warmer winters let deer ticks march north, or how often the Columbia River will flood by the middle or end of this century.

Demand for detail

“Much of the attention is actually turning away from basic research to the more applied side,” said Robert Oglesby, a climate scientist at the University of Nebraska, Lincoln. “What are the impacts of these climate changes going to be, using high-resolution climate model downscaling?”

This spring, Oglesby and another UNL climate scientist, Clinton Rowe, released the results from downscaled models that dealt at a resolution of 2.5 miles with Guatemala’s jagged mountain terrain. The consequences of climate change are especially dire in a country already prone to mudslides and violent coastal storms and with a large population living in poverty.

But Guatemala’s topography is so uneven it is tough to visualize the full impact with the big brushstrokes of a global climate model. With funding from the InterAmerican Development Bank and the Guatemalan government, Oglesby and Rowe are training scientists in Guatemala to use the new predictions to reckon with specific questions, such as how climate change might affect floods, farming or hydroelectric power.

This type of research responds to a growing demand for more detailed information about climate change. In the U.S., for example, the Obama administration has required all federal agencies to write plans for adapting to warming temperatures and worsening storms, floods and other disasters.

Downscaled models can also bring into focus, in sometimes shockingly vivid detail, the consequences of releasing too much carbon dioxide. In September, NASA unveiled climate projections for the U.S. at an even closer range — a half-mile resolution — based on the newest global models from the Intergovernmental Panel on Climate Change, the leading international body of climate scientists.

Andrew Hansen at Montana State University is using NASA’s data to estimate what might happen to public lands, such as Yellowstone, Grand Teton and Glacier national parks in the northern Rockies. In the scenarios in which greenhouse gas emissions remain high, insects and drought ravage large areas of forest, turning them into shrubs and grassland by about 2100, said Hansen. Without the cover of trees, mountain snowpack dwindles, which starves the West’s water sources. “It’s pretty dramatic. The northern Rockies are the water tower of the West,” he said.

Glacier meltingMore uncertainty

While global climate models portray an unequivocal picture of a warming planet, there’s more uncertainty at the small scale. For instance, the U.S. Southwest is almost certainly getting drier. But can researchers make a reliable prediction about a single square mile in, say, Pasadena that’s clear and reliable enough for the local water district to start preparing for what’s coming?

“It certainly is worth exploring those fine spatial scales, like a kilometer, but we have to figure out what we know and don’t know,” said William Gutowski, professor of meteorology at Iowa State University. Gutowski is part of a group of scientists who, five years ago, formed a collaboration called the Coordinated Regional Climate Downscaling Experiment, a project of the World Climate Research Programme.

The scientists, who hail from research institutions in places as far-ranging as Korea, Australia and Italy, are trying to bring together the independent work on downscaling that’s happening around the world and find out which methods generate the most reliable results. They are also developing downscaled predictions for every region of the globe at the same scale, about 31 miles, that are accessible to scientists worldwide, including those in developing countries who may not have access to the same supercomputing technology as researchers elsewhere.

At the University of California, Los Angeles’s Department of Atmospheric and Oceanic Sciences, scientist Alex Hall leads a team that has pioneered a downscaling method he believes cuts out some of the uncertainty at small scales. Instead of relying on just one global climate model, as some downscaling methods do, the UCLA approach combines computer simulations and statistics to pull together results from 32 models.

Hall’s team is producing local climate predictions for Los Angeles with funding from, among other sources, the city and the American Recovery and Reinvestment Act of 2009. Square mile by square mile, the researchers are mapping how summer days will swelter in Los Angeles’s inland neighborhoods and snow will fall less frequently on slopes in the San Gabriel Mountains.

A local environmental group called Climate Resolve, founded by former city water and power commissioner Jonathan Parfrey, has drawn on UCLA’s findings to help spur public discussions about greening Los Angeles and preparing for the impacts of climate change. Last year, Parfrey’s group helped push L.A. to become the first major city to adopt building codes that require “cool roofs,” which reflect sunlight and make houses less prone to overheating, on new and renovated homes. Parfrey believes the downscaled models also offer tangible enough details to wake people up to what’s at stake.

“By getting down to the neighborhood level, we’re going to help people understand what climate change means for them, their home, their family,” he said.

Catch Jonathan Parfrey in person at VERGE SF 2014 in October. Top photo of forest in Alberta, Canada, where pine beetles are active, by Timothy Epp via Shutterstock.



GreenBiz 101: From trash to treasure, the elusive quest for zero waste

Published July 02, 2014
GreenBiz 101: From trash to treasure, the elusive quest for zero waste

In late June, high-tech company Eaton trumpeted the fact that 39 of its manufacturing facilities globally had reached a zero-waste-to-landfill milestone. To put it another way, the sites collectively since 2010 have eliminated 2,750 metric tons of trash and materials through recycling, reuse and other new processes.

Eaton's definition of zero waste is pretty specific: to earn this status, a site must divert at least 98 percent through reuse, composting, recycling and incineration (more on this last strategy in a moment).

"Eaton has pledged to reduce greenhouse gas emissions by 25 percent, indexed to sales, by 2015. Programs such as zero-waste-to-landfill will help us reach this goal," said Harold Jones, Eaton's senior vice president for Environment, Health and Safety, in a statement. "It all starts with our employees generating the ideas and enthusiasm to help Eaton do business right."

Even though the term "zero waste" is a common phrase in the green business vernacular, the fact that Eaton needs to define its specific application suggests it is far from a mainstream concept. Here's a quick primer on why the process of striving for "zero waste" is imperative, even if the goal itself ultimately may be a nirvana we never can reach.

What is zero waste?

The phrase actually can be traced back at least to the 1970s, when chemist Paul Palmer began seeking ways to reuse chemicals produced within the electronics industry. The philosophy looks beyond recycling strategies to policies that minimize resource consumption from the beginning, by encouraging closed-loop product and production designs that stress reuse.

While many existing zero waste initiatives include recycling as part of the process, the focus is shifting to emphasize the value that can be derived out of those collected materials — whether it is excess food or materials that can find an appropriate second life. Influential entrepreneur and sustainable business strategist William McDonough suggests that moving forward, zero waste strategies should focus on a "cycle of endless resourcefulness."

Where can a zero waste philosophy have relevance?

Product designers, manufacturers, retailers, municipalities and consumers all share responsibility in moving toward zero waste — one reason that reaching zero is a tough act to pull off.

Sacrificing materials quality for the sake of minimizing consumption, for example, is a trade-off most consumers will refuse to make. After years of designs that stress "planned obsolence" and upgrade cycles (especially in the technology and electronics worlds), convincing product creators to design for longevity is a big mindshift. Meanwhile, asking manufacturing operations to overhaul processes and systems that have been in place for years just to accommodate some sort of recycled material is something that just won't happen overnight.

The secret lies in focusing less on how much waste can be diverted and more on how it can be used to create value. "In a zero waste world, every material relegated for recycling would have a specific destination, just as those liter-size Pepsi bottles are reprocessed into PET (a solid version of polyester) and then converted into new bottles," wrote consultant Anthony Zolezzi for GreenBiz. "Another example: Johnson Controls thermostats that have the perfect color and blend of plastics would be continually returned to the company and reused."

Where has meaningful progress been made?

A number of progressive organizations have adopted ambitious zero waste strategies under the guise of new recycling and trash collection programs, including communities such as Seattle, Austin, San Francisco and Oakland, Calif., and companies including Kraft, Procter & Gamble and Walmart.

On the municipal level, this agenda has translated into overhauls of traditional trash hauling and waste management strategies. In San Francisco, for example, the city has banned the use of non-compostable or non-recyclable food containers and mandated the reuse of all construction debris, to name just two specific initiatives. Oakland's program, adopted back in 2006, seeks to reduce the annual amount of waste sent to landfills to just 40,000 tons by 2020 (compared with 400,000 tons for the benchmark year). It, too, has focused on rethinking how different waste streams are sorted and collected.

At the corporate level, big manufacturers are making strides, as it turns out better waste management makes for more efficient facilities.

P&G unveiled its first zero-waste-to-landfill facility in North America (in Auburn, Maine) back in 2010 after achieving that status for eight sites in places such as Belgium, Hungary, Italy and the United Kingdom. In Maine, about 60 percent of the waste is recycled and the rest is used for energy generation.

Walmart's first step on its journey to zero waste is to divert 100 percent of the waste from its U.S. operations from landfills by 2025, with 2008 as the baseline for progress. As of April, the retailer has achieved this for 81.66 percent of the materials that flow through its stores, clubs and U.S. distribution centers. The total waste generated by its U.S. operations was reduced by 3.3 percent compared with a 2010 baseline. The retailer also has focused on producing more food with fewer resources, a strategy that covers optimizing fertilizer use and embracing sustainably produced palm oil for its private brands.

Reality check: What's holding back zero waste initiatives?

One big impediment centers on the collection process. Getting homeowners and businesses to sort different waste streams for collection, especially for food and organics composting, remains an uphill struggle even in places that support the idea. In San Francisco, which recycles or composts about 80 percent of its garbage — more than double the national average — some businesses were fined for refusing the services. Incentives have been necessary to get people on board.

Building on the point about having a "destination" for collected materials, some communities and businesses still use the controversial strategy of incineration to avoid sending things to landfill. It's telling that Eaton makes a point of saying that it uses this strategy "only if the heat generated by incineration is collected and used in order to create more energy than was required for the incineration process."

Denmark, one of Europe's greenest countries, traditionally has burned close to 80 percent of its household waste but it is trying to change this as it reflects its own zero-waste strategy. “We must recycle more and incinerate less,” said Ida Auken, former Minister of the Environment, on announcing this strategy in late 2013. "It is my mission to make Denmark a waste-free society that recycles as many materials as possible. That is why we must sort our trash so we can extract the value from the waste. It is good for the environment, and it can create new jobs and business opportunities."

Editor's note: Eaton's zero-waste definition is at least 98 percent diversion, not 80 percent as the article originally stated.

Image of cans by Don Pablo via Shutterstock



How She Leads: Dimetria Jackson, Golden State Foods

Published July 01, 2014
How She Leads: Dimetria Jackson, Golden State Foods

How She Leads is a regular GreenBiz feature spotlighting the careers of women who have moved into influential roles in sustainable business.

With more than $6 billion in annual revenue and 4,500 employees, Golden State Foods in Orange County, Calif., is one of the largest suppliers to the foodservice industry. The company is big on community involvement: More than 80 percent of its workforce is involved with the GSF Foundation, dedicated to helping children and families in need.

At the center of GSF's evolving environmental strategies is Dimetria Jackson, hired in December 2012 as director of corporate social responsibility and sustainability. An attorney by training, Jackson is a graduate of Dartmouth College and the University of Virginia School of Law. In her "spare" time, she is the CEO of redBAMBINA.com, an outline boutique for children and expectant mothers; plus she's raising two young boys with her husband. I spoke with Dimetria about how her legal background helps shape her management of GSF's far-reaching CSR and sustainability objectives.

Heather Clancy: You went from being a lawyer to becoming a sustainability executive. What inspired you to make that move? 

Dimetria Jackson: Lawyers have had a positive impact on corporate governance, human rights and environmental protection, as well as shaping the CSR programs of many corporations around the world. As lawyers, we're trained to work within a framework in accordance with regulations, and as sustainability and CSR become more regulated — and I'm referring to self-regulation as well as self-reporting — I envision that more lawyers, and CFOs, will become involved in CSR. I was inspired to make the move to GSF based on my interest in learning the subject matter. I also have a passion for ensuring that natural resources are going to be available for my generation and future generations.

Clancy: So who hired you? Who do you report to? 

Jackson: My position is centered in the GSF corporate legal department. I report to the chief CSR and legal officer, another attorney [laughter]. 

Clancy: Why is it structured that way?

Jackson: From my perspective, it's the norm, although I talk to others and I find that CSR can be in many different departments: sometimes my position reports to [human resources], sometimes it reports to the chief financial officer. At GSF, it reports to legal, along with our foundation and diversity initiatives. This makes sense because this team has so much involvement throughout the company promoting CSR and sustainability, as well as diversity. 

Clancy: What would you say are your green business priorities? 

Jackson: GSF has had sustainability goals for years, and in 2014 launched its sustainability strategic plan. My priorities involve achieving the five overarching goals set forth in that plan. Our goals for 2020 include: reducing our carbon footprint by 20 percent; achieving zero waste to landfill at 100 percent of our facilities; achieving Energy Star or LEED certification at 75 percent of our facilities; using renewable energy or alternative fuels in 100 percent of our fleet; and achieving active engagement of 75 percent of our associates. In addition to our five goals, we also seek to align our sustainability initiatives with our customers and suppliers.    

Clancy: What does active engagement mean? Just that they're participating in the programs or that they're sharing the news about what GSF is doing? 

Jackson: A combination. Our associates are, overall, very involved. We have a foundation, in which our associates are very actively involved, but we want to get them involved more broadly in our other programs as well. We have a program, for instance, called Commit to be Fit. This is a voluntary health and wellness program that includes financial wellness. Associates are encouraged to participate, they're encouraged to do our walking challenge, where we walk or exercise 30 minutes, three days a week. Then at the end of each quarter, associates are eligible for incentives for participation in the program. 

Credit: Brocreative via ShutterstockWe have Earth Week and Earth Day challenges. We have learn at lunch events, in which we invite speakers to talk on an array of topics. We do a variety of things to get our employees excited about sustainability, excited about the community and how they can get involved. Our approach is always top-down and bottom-up. We learn so much from our associates, so it's really important for them to be engaged throughout the process. 

Clancy: As I was poking around on the GSF Web site, I noticed the statement of environmental policy (PDF). Some of your goals are part of that. What's the story behind the creation of that policy? 

Jackson: It was created as a way to convey our commitment to our associates, customers and suppliers, as well as the communities in which we operate. I think the plan was being put into place about the time that I arrived. I had some input with regard to the plan, but it was developed in conjunction with our CSR/Sustainability Steering Committee, as well as our CSR/Sustainability Champions. We seek to have buy-in from a cross-functional group of associates. We have representatives from each of our domestic facilities; we meet monthly, and we also include IT, Finance and Health and Wellness representatives within the meetings. 

Clancy: Will the policy statement change over time?

Jackson: It's pretty stable. I think that if there were something we decided to do that was dramatically different from what's already set forth, we would make changes. We have [the policy] numbered at the bottom, so we can make sure that we have the correct one at each facility. This statement of environmental policy, by the way, is posted at all of our facilities, so if we have to make a change, obviously we're going to have to change the policy and send it out to all locations. The policy has been in place for at least a year, maybe a little longer. It sets forth our commitment, so we wanted to make sure that it was readily available to the public and also make sure our associates see it, every day. 

Clancy: What do you consider your team's most important achievement so far?

Jackson: We've made several important achievements that I'm quite proud of. From a mindset standpoint, we have a uniform direction and goals to achieve carbon footprint reduction and other social, environmental and economic impacts. In regards to the environment, we're exploring innovative ways to use renewable energy. 

Credit: freyfreyphotography via FlickrFor example, we installed solar panels on our trailers at our City of Industry [Calif.] distribution center to power the pallet jacks. We're planning to expand this initiative to our Phoenix and Hawaii facilities — basically to make better use of the sun's rays. This summer, our Illinois associates are moving into GSF’s newly constructed Chicago Distribution Center that will be LEED Gold and ISO 14001 certified.

Currently, 100 percent of the GSF distribution centers dedicated to McDonald's business are ISO 14001 certified. GSF’s New Zealand facility has also achieved ISO 14001 certification and our manufacturing facility, in Conyers, Ga., is scheduled to achieve ISO 14001 certification this year. One of our goals is to have an environmental management system at all of our facilities by 2017. We've achieved over 50 percent of that goal to date, which has resulted in increasing our landfill diversion rates, and driving energy reductions and cost savings for the company. 

Lastly, from a social perspective, I mentioned earlier we have a GSF Foundation. Currently, more than 80 percent of our associates are actively supporting the foundation through personal involvement and donations. The foundation is dedicated to improving the lives of children and families in need. I’ve found, from talking to other people, that it is rare to have such a high level of commitment from our associates to our foundation; which is just wonderful. 

Clancy: Realizing that there are many challenges in your job, what is your biggest daily obstacle and how are you surmounting it? 

Jackson: There is so much to do, and no lack of ideas and programs to implement. Our challenge is identifying initiatives that fit our business and keeping the directional push forward and our associates engaged. We don’t always get it right, but we fail forward and reset when necessary.

Clancy: Who do you consider to be your most inspirational mentor? 

Jackson: My most inspirational mentor, or mentors, was not environmentalists [laughter]. My most inspirational mentor is the Honorable Thurgood Marshall, who was the first African-American Supreme Court Justice and lead attorney in the Brown vs. Board of Education case. My parents are also my mentors. Justice Marshall inspired me to go to law school, and my parents inspired me to make a difference; to make a difference in my community. 

Clancy: So, what advice would you give someone who aspires to a career like yours? 

Jackson: I think it's important to learn the landscape through coursework, certificate or degree programs, and also to explore volunteer opportunities. I would also recommend that you learn the language of your industry and work with the business leaders to become a trusted resource and help add value to your organization's bottom line.

Top image of Dimetria Jackson by GSF.



How Inova, Dignity and Kaiser advance healthcare sustainability

Published July 01, 2014
How Inova, Dignity and Kaiser advance healthcare sustainability

In early June, BrownFlynn presented at the annual CleanMed conference, the health care industry’s largest conference for professionals on the leading edge of sustainability within the industry. The session, which focused on reporting as a management tool, was conducted along with VHA (which provided a unique supplier perspective), SASB (which presented its work on the identifying of the most material issues for the industry) and BrownFlynn (which outlined the larger context of sustainability and value of measuring, managing and reporting on sustainability performance).

The packed room represented health care professionals at every stage of the reporting process and from every part of the industry’s value chain. The panel spoke about the business case for reporting and the many tools available to help define materiality, manage sustainability issues and effectively communicate performance to a range of stakeholders. The interactive session also involved several industry professionals from the audience who shared their stories of navigating sustainability and the reporting process, as well as several other important issues such as active engagement with suppliers.

One example in particular was Inova Health System. It was the top-ranked hospital (Inova Fairfax Hospital) in the Washington, D.C., area in 12 specialties (including gynecology and neonatology) for two straight years, according to U.S. News & World Report. Inova has been reporting since 2010, and recently went through a rigorous materiality assessment that resulted in its soon-to-be published GRI G4 sustainability report.

“Inova has been committed to following GRI’s reporting process for several years, with a goal of promoting transparency in reporting within the health care industry," said Carolyn Billetdeaux, sustainability associate at Inova Health System. "In terms of report content and the stakeholder engagement process, you really can see how this year’s G4 report differs from those of previous years." Billetdeaux added that materiality assessments have helped turn Inova's annual reporting process into ongoing dialogue with its stakeholders, and the outcomes of that process allowed it to maximize the relevance of the information shared and adjust its broader strategy.

Inova Health System is also a founding sponsor of the Healthier Hospitals Initiative (HHI), a national campaign that aims to implement a new approach to improving environmental health and sustainability across the health care sector. HHI is part of a larger industry-wide movement that includes Health Care Without Harm, Practice Greenhealth and the Center for Health Design. HHI comprises 12 of the largest, most influential health systems in the nation. Overall, more than 500 hospitals are involved and represent $20 billion in health care purchasing dollars. This group includes well-known institutions such as Dignity Health, Kaiser Permanente and Cleveland Clinic, health systems that are making a big impact on sustainability in the sector.

Dignity Health (formerly known as Catholic Healthcare West) was not only the first to produce a GRI report in the industry, but also actively exercised its shareholder influence to engage suppliers on particularly environmental and social issues of greatest significance to Dignity and its key stakeholders (patients, patient families, employees and the local community). Sustainability issues of significance to Dignity include the link between poverty and poor health, access to prescription drugs for the uninsured or underinsured, workplace diversity and supplier product responsibility. In fact, the shareholder advocacy team set a precedent when it used a shareholder resolution to engage a key supplier on the issue of carcinogens in medical supplies and equipment. 

“Advancing sustainability initiatives in our own operations and in our supply chain is integral to our mission of promoting the broader health of the communities we serve and the planet we share," said Sister Susan Vickers, vice president of community health for Dignity Health. "We consistently raise issues of concern with our vendors and engage them in identifying more environmentally preferable products and services.”

Industry influence on the economy

Few people realize the actual size of health care, including the sectors that it encompasses, or the extent of its supply chain. Recent economic data identifies the health care sector consisting of biotechnology, pharmaceuticals, medical equipment and supplies, healthcare delivery, healthcare services and supply chain, and managed care, which in turn represents close to 20 percent of the U.S. GDP. Given the obvious influence of this sector on the economy as a whole, it is important to not only understand how and why these health care systems are managing their own operational footprints, but also where they are heading with respect to sustainable procurement.

Kaiser Permanente is one of the nation’s largest not-for-profit healthcare providers, serving about 9.3 million people in 39 hospitals and 618 medical offices across the country. Kaiser Permanente comprises the Kaiser Foundation Hospitals, Inc., Kaiser Foundation Health Plan, Inc. and the Permanente Medical Groups, with a 2013 operating revenue of more than $53 billion. In 2010, Kaiser Permanente launched a Sustainability Scorecard for medical products. The health care provider requires suppliers to provide environmental data for $1 billion worth of medical equipment and products used annually in their hospitals, medical offices and other facilities.

This scorecard was the first of its kind in the health care sector, and not only allows Kaiser Permanente to evaluate the sustainability of each medical item it purchases, but helps it encourage its suppliers to provide more sustainable products. The scorecard is one initiative described in a book due out later this month, “Greening Health Care: How Hospitals Can Heal the Planet” by Kathy Gerwig, Kaiser Permanente’s environmental stewardship officer. “The book presents practical solutions for health care organizations and clinicians to improve their environments and the health of their communities,” said Gerwig.

Managing a massive supply chain

Due to the wide range of goods and services procured by hospitals, a unique layer is woven into the healthcare industry known as the Group Purchasing Organization (GPO) — an entity that leverages the purchasing power of a group of organizations in order to obtain discounts from vendors based on this purchasing power. One example of a healthcare GPO is VHA.

VHA is a national network of about 5,000 not-for-profit healthcare organizations that work together to leverage savings in their supply chains, and has produced five sustainability reports, with the most recent two reports in accordance with the GRI Guidelines. VHA is the majority owner of Novation LLC, the largest supply chain company in health care which provides the market data and analytical capabilities to help members make better purchasing decisions. In 2011, VHA acquired Provista, a leading supply chain improvement company that leverages Novation’s contracting services to help health care organizations and professionals improve their performance.

Influential associations

Similar to the health care industry and its respective associations, ever other industry has its own industry associations, many of which are exploring how they can help their members navigate sustainability. One leading example of industry associations helping members manage and improve their sustainability performance is the Automotive Industry Action Group. AIAG has created an entire curriculum dedicated to training its members on corporate responsibility, including reporting, conflict minerals, chemical management, greenhouse gas emissions and self-assessments. Further, industry-leading original equipment managers (OEMs) such as General Motors, Ford and Chrysler have adopted the GRI Guidelines as their preferred sustainability reporting framework. AIAG became a GRI Organizational Stakeholder in 2012 and is offering a series of GRI training sessions.

Similarly, the Electronics Industry Citizenship Coalition is a group of leading electronics companies working together to improve efficiency as well as social, ethical and environmental responsibility in the global supply chain. EICC members have to adopt the Code of Conduct that was established to ensure worker safety and fairness, environmental responsibility and business efficiency. This Code is reviewed every three years in collaboration with its members and stakeholders. One of EICC’s members, Intel, conducts an annual Supplier Sustainability Leadership Summit that is attended by senior managers from about 75 of its top tier suppliers. In 2013 the summit focused on sustainability reporting, and in 2014 the summit will focus on transparency. Webinars will lead up to this summit and will address Intel’s expectations of suppliers, including using GRI as the framework for sustainability reporting.       

Public, private, large and small

As we’ve explored in previous articles such as “The long journey to sustainable procurement” and “Government leaders dive into G4 reporting,” the most profound influence on the sustainability field is due to the increasing demand on suppliers to disclose sustainability information. Walmart’s influence on its supply chain was only the tip of the iceberg. Not only are an increasing number of corporations (public and private) seeking disclosure from suppliers, but a growing number of public and private institutions are doing so as well, such as cities, counties, states and federal agencies, universities and educational organizations, and as outlined above, non-profit and for-profit health care systems. In addition, similar to the healthcare associations mentioned above, every industry has a related association and more of these industry groups are not only looking at their members' sustainability performance, but also developing their own supply chain initiatives and programs. 

Recognizing that this wave is rapidly growing (and in some areas the wave is already breaking) can help you and your organization strategically prepare and manage this new demand for sustainability information. Understanding materiality as related to sustainability reporting is a key part of your sustainability journey, as is understanding what your peers are doing and what your stakeholders expect.

NexGen — Impact Sourcing

As touched on above, responsible procurement and supply chain management is evolving in a very interesting way. While the Intel story shares a new level of positive impact that can come from a progressive supply chain engagement approach, some organizations are looking at supply chain through an even broader sustainability lens — the lens of Impact Sourcing. A great article titled “Impact Sourcing 101: Innovative Outsourcing with Positive Business and Social Impact” by Sarah Troup (Rockefeller Foundation) discusses how this business model is helping to innovate the way companies create shared value through their services supply chain.

For example, service sector companies are employing high potential workers in disadvantaged areas (such as parts of Africa and India) to help meet and exceed cost and quality objectives, as well as enable these workers to earn a higher income — sometimes up to 200 percent more than they would earn in another job. Furthermore, studies show this idea is catching on. A recent survey found that 46 percent of companies were likely to engage in Impact Sourcing if they participate in corporate social responsibility (CSR) initiatives. The fact that companies are both meeting their business needs while giving people they might otherwise overlook an opportunity to work and learn valuable workplace and technical skills makes for an inherently more responsible supply chain. It also contributes to broader impacts in family and community such as the reduction of poverty and further investments in family health care and education.

So the question becomes: How and who do you choose? Because a massive supply chain is difficult at best to manage, how do you prioritize key suppliers to engage with more deeply, more proactively and in alignment with your larger sustainability objectives? And how do you go about such engagement? As referenced above, there are several ways to prioritize. Intel focuses on its top 75 suppliers as these comprise the majority of its supply chain. Other companies may choose to focus on areas where their operations have the biggest impact on the socioeconomic conditions of the people who live and work there. Regardless of prioritization, the common thread in working effectively with your supply chain is engagement — or more specifically, education. More often than not, many companies in your supply chain do not have the necessary capacity to easily respond to the myriad of sustainability demands they are increasingly receiving. Providing these companies with tailored training and helping them understand the growing interest in transparency on material sustainability issues is not only mutually beneficial, but benefits the broader, common sustainability interests of the marketplace. Rewarding transparency with continued contracts reinforces this transparency and helps us all make a strong business case for sustainability. 

Top image via Shutterstock




5 steps to reduce the chemical footprint of plastic products

By Ann Blake and Mark Rossi
Published July 01, 2014
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Tags: Chemicals, Packaging
5 steps to reduce the chemical footprint of plastic products

By switching the type of plastic used in its IV bags, Dignity Health care system kept 700,000 pounds of high-concern chemicals — the equivalent in weight of a Boeing 747 airplane — out of the environment, according to BizNGO's new analysis of plastics, The Plastics Scorecard v.1.0.

Starting from fossil fuels, the steps in plastics manufacturing are littered with chemicals of high concern to human health and the environment. For companies looking to reduce their use of high-concern chemicals, plastics are a huge challenge — and a significant opportunity to reduce their chemical footprint.

In The Plastics Scorecard, we identified over 244 million metric tons of high-concern chemicals used in the manufacture of plastics. For example, plastics consume 96 percent of all Bisphenol A or 3.9 million metrics tons annually. BPA and other high-concern chemicals such as benzene, styrene and phthalates can pose significant risks to the health of workers, communities and the global environment across the life cycle of plastics.

Shifting to safer plastics will improve the health and safety of workers and communities, spur the development of green chemistry and create new markets for companies, workers and communities alike. So how do we get there? The Plastics Scorecard is the first comprehensive method for evaluating the chemical footprint of plastics and a guide for selecting safer alternatives.

How does your plastic rate?

The Plastics Scorecard evaluates plastics based on two criteria, Manufacturing Score and Product Footprint.

Credit: BizNGOThe "Progress to Safer Chemicals in Manufacturing Score" evaluates plastic polymers on a scale from 0 (most hazardous) to 100 (most benign). In evaluating 10 polymers, the findings were mixed.

Five commonly used polymers score 0 due to the intensive use of high-concern chemicals at every step of manufacturing: polyvinyl chloride (PVC), polycarbonate, polystyrene, styrene butadiene rubber (SBR) and acrylonitrile butadiene styrene (ABS).

Three polymers — polylactic acid (PLA), polyethylene (PE) and polypropylene (PP) — are much further along the path to safer chemicals in manufacturing because their core chemicals inputs are not chemicals of high concern.

Two polymers — polyethylene terephthalate (PET) and ethylene vinyl acetate (EVA) — are in the mid-range.

The Product Footprint measures the number and percent weight of chemicals of high concern in plastic products. It enables purchasers to evaluate products based on their content of highly hazardous chemicals. The report found that by switching to safer plastics or additives, manufacturers of IV bags and electronics can sell products with a significantly lower chemical footprint. For example, by switching from PVC to non-PVC IV bags, health organizations are significantly reducing their use of reproductive/developmental toxicants and endocrine disruptors such as DEHP and BPA.

5 steps to safer plastics

The Plastics Scorecard lays out a five-step program for companies seeking to reduce the chemical footprint of their plastics:Credit: BizNGO

1. Is it necessary? A critical approach to chemicals in general and plastics in particular, especially plastic additives, is to first ask: Is it necessary? For many plastic additives, evaluate if it's necessary for the performance of the product. For example, Kaiser Permanente recently announced it is eliminating unnecessary flame retardants in upholstered furnishings.

2. Find safer additives. In cases where plastic additives are necessary, there are many routes for reducing a product's chemical footprint. First, and often the easiest route, is to substitute high-concern additives with safer alternatives. For example, in the electronics sector, companies are replacing brominated flame retardants with safer alternatives. Figure 2 [ES-3] illustrates how electronic companies dramatically can reduce the chemical footprint of chemicals in products by selecting safer alternatives.

3. Use safer polymers. The most important thing companies can do to reduce their chemical footprint is to shift to safer polymers with better manufacturing scores and fewer additives — thereby reducing both the additives of high concern and the manufacturing footprint. For example, when Dignity Health switched to non-PVC IV bags, it eliminated roughly 1,543,467 pounds of PVC as well as 673,023 pounds of the reproductive toxicant DEHP and 33,651 pounds of the endocrine disruptor BPA over a six-year period.

4. Close the loop and use post-consumer recycled content. PCR content holds the potential of significantly reducing the chemical footprint of a plastic product by bypassing the impacts of polymer manufacturing. In general, using PCR content is a preferred route for reducing the chemical footprint of a polymer and a plastic product. A challenge with PCR content can be the legacy of the past use of chemicals of high concern in plastics manufacturing. For example, the recycling and reuse of polyurethane foam means that companies continue to keep the persistent, bioaccumulative and toxic (PBT) flame retardant pentabromodiphenyl ether (pentaBDE) in the economy. Concerns with legacy toxic chemicals in PCR plastics should be a driver to reduce the chemical footprint of plastics.

Redesign the product. Product redesign holds the potential of both enhancing the value of the product while reducing its chemical footprint. For example, companies can redesign electronic products such that plastic parts do not come into contact or into proximity with parts that heat up, thereby obviating the need for flame retardants. The redesign of chairs to use wire mesh instead of foam reduces the weight and avoids foam that requires flame retardant chemicals.

Credit: BizNGOUltimately the success of reducing the chemical footprint of plastics will require greater transparency on the chemicals in products. Chemical footprinting holds the potential to create a metric for measuring progress away from chemicals of high concern and toward safer alternatives. A challenge to managing chemicals in products and supply chains always has been, as the business adage goes, "You can't manage what you can't measure." To date companies have lacked clear metrics for measuring progress to safer chemicals. The Plastics Scorecard, by creating a framework for chemical footprinting, creates a metric by which companies can manage chemicals and measure progress.

If successful, the Plastics Scorecard will advance the development and use of plastics that use inherently safer chemicals in all steps of polymer production as well as in the selection of additives — thereby greatly reducing the costs of hazardous chemicals all along the lifecycle of plastics, from manufacturing to use to disposal.

Plastic bottles image by Pressmaster via Shutterstock.

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Gecko-inspired dry adhesive, a slow-cooked disruptive innovation

By Tom McKeag
Published July 01, 2014
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Tags: Biomimicry, Design & Innovation
Gecko-inspired dry adhesive, a slow-cooked disruptive innovation

“Disruptive” conveys such a sense of brutal, even violent, shift, doesn’t it? Shattered planets, chaotic classrooms and collapsing towers come to my mind when I think of the term. But, of course, disruption comes more frequently in the slow-cooked version: climate change, for instance. Similarly, innovation can follow the same typology, the old joke being that he or she was an overnight success 10 years in the making. The model for innovation, as it turns out, is more likely Thomas Edison’s highly planned research and development organization than Archimedes in his bathtub.

The gecko lizard has been a poster child of biomimetics for nearly 15 years since it sparked the interest of a young postdoc researcher in the integrative biology department at the University of California, Berkeley, in the late 1990s. Kellar Autumn, now a professor at Lewis and Clark College in Portland, Ore., was on vacation when he became intrigued with the gecko’s ability to stick to his bungalow’s ceiling. How do they do that? The question led to hundreds of journal papers by laboratories across the globe, more than $30 million in U.S. federal grant funding and over 100 U.S. patents and patent applications.

Autumn demonstrated in 2000 that his vacation bunkmates were clinging to surfaces by a dry action, not some type of wet adhesive or liquid surface tension. He later proved in 2002 what that action was. Geckos stick to surfaces by weak intermolecular attraction called van der Waals forces, and they do it with a hierarchical array of structures on their feet. From the mechanical gripping of their toes to the fringes or lamellae on those toes to the hairs or setae on those fringes to the split ends on those hairs to the pads or spatulae on those split ends, the gecko has made “up close and personal” its way of life.

We cannot stick to that ceiling because we cannot get close enough (with enough surface area). The gecko can. It sports millions of 200-nanometer-diameter spatulae on the slit ends of its toe hairs. As a matter of fact, with 15 to 30 pounds of force per square inch, the typical gecko can support its own weight with just one (highly fringed) toe. Importantly, it can unstick itself at will by changing the angle by which the toes are applied to the surface. The toes will peel back from a surface not unlike a New Year’s noisemaker rolling back.

Slow development

The discovery of this natural phenomenon was a phenomenon itself when first reported in the Proceedings of the National Academies of Science. All sorts of applications have been put forth since, from car parts to surgical sutures.

The development of a universal adhesive device has been a slow slog, however — except when compared to the historically glacial schedule of bringing disruptive inventions to market. What may be popularly called the “two-sided geckotape” some day will remind us that George de Mestral himself labored for a decade to manufacture and sell his first Velcro after inventing it in 1948.

The long journey of a universal gecko-inspired dry adhesive has been marked recently by two important milestones, however. Last month, not-for-profit Draper Laboratories of Cambridge, Mass., working under the aegis of the DARPA Z-Man project demonstrated the utility of their gecko-inspired polymer in a climbing apparatus of two large paddles. It can support an over-200-pound man carrying a 50-pound load as he climbs up a 25-foot high wall of glass. The paddles are meant for military use at this stage. The goal is eventually to develop a field kit for urban climbing.

The other milestone is the development of Geckskin by an academic team from the University of Massachusetts, Amherst, as reported first in a February 2012 issue of Advanced Materials journal, and more recently in April.

The interdisciplinary team (engineering, biology, polymer science) that has developed Geckskin at UMass took a very different approach from previous groups. Unlike other synthetic gecko materials, Geckskin relies on a broader scale hierarchy to stick. The team studied the relationship of the animal’s skin to its tendons and bones, and found it to be as important as the nanoscopic hairs on the feet. They discovered that the animal's tendon is integrated into its skin. They borrowed this feature from the gecko and made it a key feature of their design.

Soft pads and stiffening skin for a new sticky material

Their “draping adhesion” system consists of silicone (or polydimethylsiloxane, PDMS) woven into a synthetic tendon of Kevlar or carbon fiber that maintains stiffness and rotational freedom. PDMS is cheap, non-toxic, stable and acts as a soft pad; the Kevlar or carbon fiber acts as the stiffening skin. Professor Al Crosby, who leads the team, estimates that a 16-inch-square pad able to hold 700 pounds would cost about $0.25 in materials.

Unlike typical visco-elastic adhesives that flow into close contact based on temperature, the material conforms to a surface while still maintaining high, elastic stiffness in directions where forces will be applied. As in the animal, the sticking of this combination is reversible and reusable, for it has to be loaded in one direction to stick. For example, it will adhere while experiencing a downward force, but removing the force and pulling up will free the material from the surface.

The fabric is applied to a surface with a burnisher in order to make tight contact. The inventors promote it as a hanging device for electronic appliances, and are discussing applications for it with both private investors and industry representatives.

The disruptive power of dry adhesive technology to change entire methods of design and manufacturing appears limitless today, as does the applications potential of a cheap, easy to use, reversible, reusable dry attachment device for heavy objects.

Those milestones bring the much anticipated application of a universal dry and tunable adhesive closer to everyday use. They would not have been possible without the slow simmer of years of research, exploration and debate by the dedicated men and women of our scientific community.

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IKEA, Microsoft and Google power business with wind

By Lyn Meany
Published July 01, 2014
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Tags: Energy Efficiency, Renewable Energy, More... Energy Efficiency, Renewable Energy, Renewables
IKEA, Microsoft and Google power business with wind

Those who bemoan the seemingly slow adoption of renewable energy in the U.S. should take heart. Not only is the use of solar energy growing at rates well beyond those predicted as recently as last year (see this recent blog post), but so many companies have recently announced major renewable energy (RE) initiatives that it looks like we’ll need a bigger bandwagon pretty soon.

It’s hard to keep up with all the new developments, pledges and commitments businesses large and small are announcing of late. Here are just a few examples.

IKEA just bought the Hoopeston Wind farm, comprising 49 turbines in Vermillion County, Ill. This is its first wind farm investment in the U.S. and its largest renewable energy project. Set to become operational in 2015, Hoopeston will generate 380 GWh per year ­— nearly 1.5 times the energy needed to operate all of IKEA’s U.S. operations.

Late last year, Microsoft announced that under a 20-year power purchase agreement, it plans to purchase the entire output of the 55-turbine, 110 MW Keechi Wind Project farm in Texas to power one of its data centers. The move is a departure from most of Microsoft’s renewable energy efforts to date, which primarily have been in the form of buying renewable energy credits (PDF).

Facebook reported its own new wind power initiative last winter: When its new data center in Altoona, Iowa, goes online in 2015, it will be 100 percent powered by a wind farm in nearby Wellsburg. Currently under construction, this farm is expected to produce 138 MW for the Iowa grid.

Then, of course, there’s Google. Long a leader in energy efficiency and renewable energy, in April it announced its largest RE purchase to date: a deal to purchase up to 407 MW of 100-percent renewable wind energy to power its data center in Council Bluffs, Iowa. This purchase brings Google’s renewable energy commitments to more than one gigawatt.

Kohl’s, Intel, Walmart, Volkswagen — the list of companies investing directly in renewable power generation to meet their own energy needs goes on and on. Given the high price tags on wind farms and large solar arrays, it’s not surprising that these are all companies with very deep pockets. But it’s telling that a growing number of businesses that have the money to spend — particularly ones with gargantuan energy needs — spend it not just on NASCAR sponsorships, stadium naming rights and Super Bowl commercials.

It makes more than financial sense

So why has the bandwagon gained such momentum in the business world? “Because it’s the right thing to do” may be part of the answer: Shelton Group’s B2B Pulse report found that company culture/CEO or owner values are the second strongest driver behind business sustainability initiatives. However, IKEA CFO Rob Olson said his company invests in RE “not only because of the environmental impact, but also because it makes good financial sense.” Solar Energy Industries Association (SEIA) president Rhone Resch similarly stated that a solar commitment is “a street-smart investment. […] Companies are expanding their use of solar because it makes sense from both a business and social responsibility viewpoint.”

The business case for renewable energy is fairly well established and has become even stronger in the past year, particularly in RE’s ability to work toward lower and stabilized operating costs. The social responsibility viewpoint cited by Resch is also becoming increasingly important to companies of all sizes. Shelton’s Eco Pulse 2013 report revealed that the importance of corporate reputation continues to rise in the minds of consumers and can have a significant influence on their purchase decisions. More than 48 percent of survey respondents said that a company’s environmental reputation had some to major impact on their decision about whether to buy its products.

And Americans are in love with the idea of renewable energy. In our Energy Pulse 2013 study, when asked to rank national energy issues in the order in which they should be tackled, the development of alternative energy sources was ranked first — higher, on average, than the development of more domestic oil and natural gas.

All the recent good news is heartening. However, plenty of room is left on the bandwagon, and it appears that companies not pursuing renewable energy in some form, whether directly or through RECs, soon may risk appearing anachronistic, if not downright irresponsible, at the ultimate expense of their bottom lines.

This article originally appeared at Shelton Group. Top image by pedrosala via Shutterstock.

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How to solve the biggest water-energy-food problems

By Kelli Barrett
Published July 03, 2014
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Tags: Agriculture, Food & Agriculture, More... Agriculture, Food & Agriculture, VERGE, Water, Water Efficiency & Conservation, Water Use
How to solve the biggest water-energy-food problems

Explore food and water systems in depth at VERGE SF 2014 in October.

India is one of the world's biggest users of groundwater, but the aquifers that store much of its freshwater are overused, slow to replenish and rapidly depleting. That's because the country's rapidly expanding middle class has boosted its farms, which are stretching its water resources beyond capacity. The same thing is happening in energy, which uses water for cooling thermal power plants. If India doesn’t address its water challenges, it won’t be able to support its growth in both the food and energy sectors — and thus its evolution as a nation.

The country is far from alone. In China, where water distribution is woefully imbalanced, the dry desert-like north contains most of the croplands but only 16 percent of the freshwater. Natural resources are constrained throughout the nation, and the extraction activities that do take place have a big impact on groundwater and other water sources by significantly depleting them. Energy development often competes with the agriculture sector for water use.

Likewise in the United States, large-scale agriculture projects in California earn billions of dollars but also require enormous amounts of water — which, in a place such as California, is in short supply. Demands for energy development factor in here, too — with different forms of energy extraction underway across the state, including hydraulic fracturing (fracking) — the natural gas extraction practice that pumps millions of gallons of water, sand and other chemicals into the ground to bust open shale formations to access the energy source inside.

Each region — and, indeed, every part of the world — is caught in the “water-energy-food-nexus.” Because the challenges are becoming increasingly interdependent, integrated solutions that involve cross-sector collaboration must be adopted. The concept is complex, but at its core, the nexus focuses on natural resource scarcity and management.

Understanding the nexus

Ultimately, “nexus thinking” means implementing integrated solutions at an ecosystem or landscape level that enhance security and sustainability in all three sectors.

The food sector part of the nexus is perhaps simplest to comprehend. Water and energy are both needed to produce food, and agriculture consumes 80 percent of water resources. As populations and prosperity increase in places such as India and China, people will demand more meat, which means a greater demand for corn and soybeans to feed animals. Some argue we’ll see a self-correction as the system implodes, taking with it populations and prosperity, but that’s not a solution — it’s a tragedy.

The interdependence between water and energy is more complex, and we might as well start in California.

The state uses 20 percent of its electricity to pump, treat and deliver water via the world's largest public power development and water delivery system, the California State Water Project, which supplies 23 million people in California's water-scarce but populous southern region with drinking water. This involves miles of pipelines, tunnels and canals and includes carrying water 2,000 feet over the Tehachapi Mountains. It's the largest single user of energy in the state.

Then you have the fact that water is required in basically all forms of energy, and often energy development takes place in areas where water is scarce. Staying in California, we see this in Kern County, where much of the state's agriculture growth also takes place. The county always has been a big energy developer containing some of the top producing oil fields in the United States. Now fracking is is in the mix, too, and it consumes roughly 164,000 gallons of water per fracking well. This is common throughout the U.S. According to a Ceres report, nearly half of all fracking activities happen in water-stressed regions.

But coal is even worse. In a year, a typical coal plant can withdraw up to 180 billion gallons of water and consume up to 4 billion gallons. A 2013 report from the Union of Concerned Scientists projected that water withdrawals would decrease by 80 percent and consumption by 40 percent if natural gas supplies 60 percent of U.S. power. This hardly would solve global water and energy challenges, however, because natural gas extraction is still water-intensive and happening in water stressed regions.

Implications of the nexus

These events unfolding around the world carry implications for the business-as-usual practices of global companies. Similar to how India's usage of its groundwater is unsustainable, the current practices of most companies aren't sustainable either. The changing dynamics of water, energy and food affect business operations thoroughly. A change in price or availability, for example, in one of these commodities affects a business from its factory floor to its corporate offices.

A recent study found that 60 percent of companies surveyed indicated water would negatively affect profitability and growth within the next five years. 80 percent of respondents said the resource will affect where companies locate facilities.

The drought that took hold of Texas in 2011 directly contributed to shuttered operations — such as a meat processing plant in Plainview — and job loss. It also prevented growth of the power sector despite significant demand for it in the state. There wasn't enough water available to ensure steady production of electricity. This instability in the energy sector prevented major businesses from locating there.

The water shortages that businesses in Texas struggle with are just one challenge companies face regarding the nexus. Businesses often share water sources with other actors outside of the sector such as farmers and local residents. And with multiple users often drawing from the same water source, what one does affects the other. Fertilizers from farming activities that pollute a watershed can render it unusable for other actions. Realizing that natural resources are shared can encourage competing demands to address the matter holistically at a landscape level.

 kazenouta via Shutterstock}

A landscape approach to the nexus also carries social implications for the local populations and perhaps beyond. For example, ecologically friendly farming practices that preserve a source of clean water for all users also provides sustainable livelihoods for local populations.

This potential sustainability is another aspect of the nexus. Nexus thinking can provide stability and promote political and economic security for societies while poor resource management can generate quite the opposite. Disagreements over water management in water-scarce regions such as the Middle East has led to conflicts between neighbors. In North Africa, for instance, Ethiopia is aiming for energy self-sufficiency with construction of the continent's largest hydroelectric dam on the Nile River. But the river is essentially a source of life for Egyptians — 83 million people rely on it for almost all of their water needs. Egyptian officials claim the nation will lose 20 percent to 30 percent of its Nile water and nearly a third of power generated from its own hydroelectric dam. Ethiopia hopes to finish the project by 2017 but in the meantime, relations between the two nations have soured. Egypt even threatens military action if dam construction isn't stopped.

This situation isn't new. Still within the Middle East, Iraq lost its once-ample supply of freshwater flowing from the Tigris and Euphrates rivers to Turkey when dams were constructed upstream.

The Middle East isn't the only region trying to grow its energy capacity. Other emerging economies in Africa and Asia are doing the same. Demand for energy is expected to rise 70 percent by 2035, according to a U.N. report on world water and energy. While bringing electricity to the 1.3 billion people who lack it is a positive, the report stated, the water required in the process isn't valued economically so its limitations are ignored. Sources are stressed and depleted. The report also predicts an increase in water resource-related conflicts unless integrated, or at least more innovative, approaches are adopted.

Nature and the nexus

With the political, social and economic implications of the water-energy-food nexus, it's easy to overlook the nexus' natural component. The nexus is part of nature. Each sector requires healthy ecosystems in order to function sustainably.

Ecosystem services that purify water and mitigate scarcity ease the severity of droughts and floods and make food and energy production more reliable. Incorporating nature into the nexus means integrating natural infrastructure such as mangroves and coral reefs, which protect coastal regions from hurricanes, into nexus management. Other examples of natural infrastructure that would benefit water, energy and food security include wetlands and floodplains that lower flood peaks and forests that filter and store water.

A report (PDF) by The Nature Conservancy and the International Union for the Conservation of Nature encourages the integration of nature into infrastructure investment creating a mixed portfolio of both natural and gray infrastructure that complements each other. The report notes a combined system of green and gray solutions would deliver the best results in terms of cost-effectiveness, risk and sustainable development.

To demonstrate how well natural infrastructure can work, there is the famous example of New York City's conserving the forests and wetlands of Catskill watersheds in order to maintain water quality and ensure a clean drinking water supply for NYC residents.

Likewise, ignoring natural infrastructure and relying completely on engineered systems often results in unhealthy ecosystems with a low productivity rate of ecosystem services. Dams built in Nigeria's Komadugu Yobe Basin affected the flow of water downstream, reducing the flooding season farmers relied on to water their crops. Invasive weeds flourished, choking waterways and ruining pastoral and agricultural lands and fisheries. The dams were built to store water for agriculture and drinking purposes but investment in the project didn't materialize, leaving ecosystems degraded and a population vulnerable to food insecurity.

Solutions to nexus challenges

Integrating natural infrastructure into management of the nexus is one solution that can have a big impact on the sustainability of all three sectors.

Answers to the nexus challenge rely on efficiency and cross-sector collaboration at a landscape level. Solutions using a framework that encompasses these elements are being considered and implemented throughout the world.

In terms of efficiency, there have been solid attempts in all three sectors to increase its levels. Referring again to the UCS report on U.S. power production, the study highlights the importance of transitioning development toward more efficient water-smart techniques. If the U.S. were to follow a trajectory of water-smart power development, water withdrawals would decline by 97 percent by 2050 and consumption would be reduced by 85 percent, not to mention power sector carbon emissions would drop 90 percent below current levels. The technology and resources are available for this transition to happen.

These water-smart techniques the UCS supports include renewable energy. India, struggling with its overworked power grid, is also exploring renewables as one way to relieve some strain and increase efficiency. The government looks to swap groundwater pumps powered by diesel fuel and the outdated power system with solar water pumps. Farmers receive subsidies to buy the solar pumps and in exchange agree to practice water-saving drip irrigation.

Not only does the initiative in India mean less water used for energy, it also could mean less water for producing food. Efficiency in producing food is a necessary component of nexus solutions. Reducing waste and growing more food on already cultivated land are two steps National Geographic lays out for feeding Earth's rising population. An entire step focuses on efficient resource use highlighting techniques such as cover crops, mulching and composting, that build up nutrients in the soil and conserve water. Innovative technology grows in the food sector as well. Computerized tractors with GPS allow farmers to better target the application of fertilizers and pesticides minimizing runoff into nearby waterways.

The private sector also is heavily involved in the spread of efficient and innovative solutions. The rising interest in natural capital among businesses is helping to guide nexus thinking along as more companies become aware of their dependence and risks regarding the natural world and begin to take action. Big companies such as AT&T and Hershey are making changes, upgrading outdated cooling systems and investing in conservation technology.

There is a gradual increase in companies addressing the nexus and managing their water risk. A recent report found that one in four watershed investment projects counted a business as a financial supporter. Companies are in partnerships with NGOs and governments over watershed protection and restoration activities, which address challenges on a large scale.

But further collaboration on this large scale level is needed in order to truly address and change the way society addresses its water use and energy and food production. And while change is often slow to happen, initial steps of understanding the water-energy-food nexus and coming to terms with the world's reliance on it can happen immediately.

This article originally appeared at Ecosystem Marketplace. Top image by Condor 36 via Shutterstock.

 

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6 trailblazers banking on clean energy finance

By Garrett Hering
Published June 30, 2014
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Tags: Cities, Energy & Utilities, More... Cities, Energy & Utilities, Finance, Renewable Energy, VERGE
6 trailblazers banking on clean energy finance

Clean energy innovation typically takes the shape of technological breakthroughs, such as high-efficiency solar photovoltaic cells designed to absorb a broader range of the solar spectrum, which — at least theoretically — should enable arrays to convert more incoming sunlight into electricity.

But no amount of technology progress alone can make much of an impact without the proper financial tools to drive meaningful volumes of solar, wind and other forms of clean energy in the marketplace.

For this reason, the U.S. Department of Energy's National Renewable Energy Laboratory (NREL) — which traditionally has focused on technology — is leading two solar lending working groups made up of more than 100 financial institutions, solar installers and service providers, law firms, consultancies and regulators.

Dawn of a new age in renewable energy financing

"We are right at the beginning of what I would describe as an evolutionary process in solar finance," said Greg Jenner, co-chair of the energy practice at Stoel Rives law firm, a member of the NREL-led Solar Access to Capital working group.

The group is focused primarily on standardizing power purchase agreements, loans and leases for residential and commercial solar projects.

"Standardization is very important," explained Jenner, because it can enable large numbers of individual distributed solar assets — such as PPAs, loans and leases — to be pooled into a newly emerging subset of solar asset-backed securities that can be sold to investors.

Such securitization is just beginning and, according to NREL, it can benefit solar energy service providers by opening up access to a broader base of capital investors, cutting financing costs, mitigating risk and creating opportunities for growth.

Working group member SolarCity, the largest U.S. residential solar installer, completed the industry's first securitization of distributed residential and commercial assets in November with a private placement of $54.4 million at an interest rate of 4.8 percent. The company followed that up in April with a $70 million securitized pool of solar asset-backed notes at 4.59 percent.

Jenner said SolarCity is just the tip of the iceberg. He and his colleagues, who include former Federal Energy Regulatory Commission Chairman Jon Wellinghoff, see rising interest in securitization.

"SolarCity is the only one so far, but you will see more," assured Jenner, even though he expects solar asset-backed securities to be limited mostly to bigger players for now — or at least until an aggregator emerges to pool assets from smaller solar energy service firms.

Credit: Vjacheslav Shishlov via ShutterstockJenner said distributed solar securitization is one of "the two most recent innovations in clean energy finance," the other being "yield cos."

Yield cos are companies that developers set up and take public in order to monetize their interests in either conventional or renewable power plants and to access lower capital costs. They own and operate pipelines of projects underpinned by long-term PPAs and pay out cash as high-yield dividends, while reserving remaining funds for new projects.

As with solar securitization, Jenner expects yield cos to be limited to players with big project pipelines. "A lot of these vehicles essentially promise an increasing yield in part due to the acquisition of new projects. So you have to sort of keep feeding the beast," he said.

Most clean energy companies are still refining their understanding of these new financial vehicles, said Jenner.

But the following six San Francisco Bay Area companies seem to already have their strategies well-developed.

1. Mosaic

Founded in 2011, Mosaic "was the first company to enable the public to invest in solar as they would in a stock or bond," said company co-founder Billy Parish. In other words, Mosaic crowd-sources investments to finance solar projects.

But that's far from the company's only financial innovation.

"We are also, to date, the only company to offer a 20-year loan for residential solar that does not take a lien on the house or make a homeowner join a credit union. It is also the only loan that competes with leases' monthly payments due to its 20-year term," said Parish. Such home solar loans are the most promising opportunity in clean energy finance today, he said: "They offer simplicity, ownership and high savings to homeowners and a low risk competitive-yield product to investors."

Additionally, said Parish, Mosaic is looking into securitization, "as we see its significance in expanding the solar asset class."

Credit: Pattern Energy2. Pattern Energy Group

Wind energy yield co Pattern Energy Group went public last year on the Nasdaq and the Toronto Stock Exchange, raising over $300 million by selling interests in more than 1,000 megawatts of capacity at eight wind farms operating in the U.S., Canada and Chile.

Pattern closed its latest public offering last month, reeling in gross proceeds of $586 million. The company intends to use the proceeds to acquire new projects. Its current portfolio includes 11 wind farms totaling 1,479 megawatts of owned interest.

3. Renewable Funding

Led by Cisco DeVries, who helped to first launch Property Assessed Clean Energy financing, start-up Renewable Energy Funding is positioned for a revival in home solar and energy efficiency projects backed by property tax assessments.

The company is administering CaliforniaFIRST, the nation's largest PACE program, which is being rolled out this summer. Renewable Funding also was recently selected develop and manage Hawaii's new Green Energy Market Securitization program.

4. SolarCity

After completing the solar industry's first two securitizations of distributed solar assets, installer and financing specialist SolarCity is ready for more.

"We plan to be a programmatic issuer in the securitization market, ultimately as much as once a quarter," said Jonathan Bass, SolarCity's VP of communications. "Securitization markets help us reduce the costs of capital and expand the sources of capital. ... Just in our two transactions you've seen the cost of capital decline even as interest rates have increased more broadly in the same timeframe."

Bass said securitization markets are a natural fit for SolarCity's "high-quality assets with predictable consumer cash flows."

5. SunEdison

An early innovator in third-party distributed solar financing, SunEdison last month informed the U.S. Securities and Exchange Commission of its intent to issue public shares in its indirect yield-co subsidiary TerraForm Power and raise up to $50 million — an amount which still could change.

TerraForm plans to debut with a portfolio of 524 megawatts of solar power plants in North America, Chile and the United Kingdom.

6. SunPower

SunPower also is exploring spinning off some of its power plant assets into a yield co, the company revealed during its first quarter conference call with investment analysts in April. But a decision is not expected until 2015 at the earliest.

The company does, however, plan to issue its first bonds backed by solar lease assets in the second half of this year. SunPower has about 20,000 lease customers in the U.S., according to chief financial officer Chuck Boynton.

Solar systems are "going mainstream," said Boynton, in part because it makes financial sense. "Homeowners are increasingly sophisticated about the value that solar delivers with regard to lowering annual electricity bills, providing a hedge against increasing rates, and reducing the household carbon footprint," explained the SunPower CFO. At the same time, "financiers understand the value that solar delivers."

With its leading high-efficiency crystalline solar panels and rich technology heritage, SunPower will continue to emphasis its technological innovations. But, said Boynton, "Financial innovation has been a critical element driving solar market growth."

Top image by fongfong via Shutterstock.

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Smart grid and smart buildings share the same disruptive impacts

By Christine Hertzog
Published June 30, 2014
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Tags: Big Data, Facilities, More... Big Data, Facilities, Smart Grid, Smarter Buildings, VERGE
Smart grid and smart buildings share the same disruptive impacts

The annual IBcon intelligent buildings conference always delivers on thought-provoking discussions and fresh insights about the intersections of technologies, policies and financial drivers in the commercial real estate sector.

The Smart Grid itself is the convergence of IT and OT (operating technologies). Smart commercial buildings — both office and multi-family residential — are experiencing a similar convergence of facilities management (the building analog to utility OT) and IT solutions. Not surprisingly, that means disruptions for the status quo.

As noted in my previous blogs, buildings use 40 percent of all energy in the U.S. The National Academy of Sciences reported that if buildings fully deployed available energy efficiency technologies and programs, we could avoid construction of new electricity-generating plants until 2030. The good news is that the building sector is paying attention to the potential benefits of EE, demand response and distributed energy resources.

Building owners and facilities managers care about top line and bottom line numbers to create a healthy net operating income. NOI is the income of a property after operating expenses, which include energy costs.

A quick glance around the IBcon exhibit floor confirmed that heating, ventilation and air conditioning remains the biggest energy consumer in a building. It's the low-hanging fruit with regards to energy management companies with solutions that can pinpoint when, how and where HVAC is operating. It's a major revelation and operating expense reduction when a facilities manager learns that an errant command starts the HVAC system in an office building at 1 a.m. instead of 7 a.m. A simple adjustment can have a meaningful impact to this property's NOI.

But like the grid itself, buildings are relatively dumb. The evolutionary and revolutionary drivers that are impacting the transition from today's grid to tomorrow's Smart Grid parallel the transformations from today's structures to tomorrow's smart buildings.

The same sensors and mostly wireless technologies that are the basis of numerous grid upgrades are disrupting buildings in similar ways. Building evolutions go well beyond machine-to-machine applications that deliver remote monitoring and control of building HVAC and lighting. Leveraging policies that encourage DR and harnessing initiatives such as OpenADR allow more buildings to participate as prosumers by automating DR transactions. More capital for EE upgrades is available in the form of green banks and other innovative financing mechanisms for property owners and managers.

Credit: Kenneth Moore via FlickrThe revolutionary impacts to the building sector occur in DER. For instance, the Shanghai Tower incorporates wind turbines in its roof to generate enough power to provision the building's exterior lighting. The second tallest building in the world also deploys its own co-generation system to operate a number of building systems. That gives it some important resiliency from any service interruptions from the power grid.

It's the early days for fully integrated DER in buildings, and over time we'll see more solutions that make them net zero or capable of sending electricity back to the grid.

Similar sectors — same problems?

Other interesting parallels or similarities exist between the electric and commercial building sectors. For instance, both share several other characteristics.

Their markets in the U.S. are fragmented. For the electric sector, over 3,000 utilities and 50 state regulatory agencies plus federal agencies have jurisdiction over utilities. However, building codes and permitting processes reflect "local control" distinctions down to the municipal and county level. If one sector would benefit from some reductions in process friction via standardization, it is the building sector.

It is conservative and protective of the status quo. The building industry has not changed substantially in over 80 years. Construction techniques haven't changed much for centuries with most buildings fabricated onsite. Utilities haven't changed much since Thomas Edison.

Asset designs and configurations are built for the long term but disconnected from consumers. Utilities built grids with inherent limitations and fragilities that get in the way of consumer expectations and prosumer transformations. Building construction doesn't always reflect usage, requiring expensive upgrades and changes to accommodate end user needs.

Data changes the way business is done. Data volume, variety, velocity and veracity are disrupting traditional business processes and creating significant challenges in reskilling people to these changes.

Of course, there is one important distinction between these two sectors: The commercial building sector is extremely competitive, not organized as a monopoly. Building occupants have choices for office and residential space, and base their decisions on multiple factors including cost. The fear of declining occupancy and losing tenants keeps property managers awake at night.

However, given the increased abilities for buildings to reduce energy requirements and generate their own electricity, the fear of declining customer bases and revenues may keep utility executives awake at night, too.

Top image of office building by leungchopan via Shutterstock. This article originally appeared in Smart Grid Library.

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