Sustainablog

This blog will cover some news items related to Sustainability: Corporate Social Responsibility, Stewardship, Environmental management, etc.

16.12.09

Green newsclips for 16 December 2009: AT&T, Smart2020 look to IT progress in fighting climate change

http://www.greenercomputing.com/news/2009/12/09/att-launches-council-advance-icts-role-climate-fight

AT&T Launches Council to Advance ICT's Role in the Climate Fight
By GreenerComputing Staff
Created 2009-12-09 12:56

DALLAS, TX — AT&T formed a new advisory council aimed at exploring the ways in which information and communications technology can reduce environmental impacts. 

The Business Sustainability Advisory Council will build upon 
research from the Climate Group that found technology can reduce up to five times the greenhouse gas emissions that are produced by the ICT sector, or up to 15 percent of global annual emissions by 2020.  

AT&T has brought together a blend of public and private interests for the council, including the Carbon Disclosure ProjectCisco SystemsThe Information Technology and Innovation Foundation, theUniversity of Colorado-Denver, and the University of Texas at Austin

It expects to add more member organizations in the near future as it works to advance measurement, methodologies and case studies to help businesses assess the positive environmental impact from ICT.

"In forming this council, we've taken an important step in helping companies realize the benefit of responsible action that, in parallel, can have compelling business benefits," said Ron Spears, President and Chief Executive Officer, AT&T Business Solutions. "AT&T is looking forward to working with the council as it helps us develop measurement methodologies to communicate the environmental benefits of ICT products and services to customers."

The move follows AT&T's 
announcement last week that it has created a new post to oversee the company's energy use. John Schinter, formerly of Jones Lang LaSalle, was appointed director of energy for the firm, joining its corporate real estate property management team. AT&T also established an energy council of key company executives to promote AT&T's energy strategy and identify efficiency opportunities. 

AT&T has set a goal of reducing its electricity intensity by 15 percent, relative to data growth on its network.

Image courtesy of AT&T.

http://www.greenbiz.com/print/30178

New Smart2020 Project Tracks IT Industry's Progress on Climate Goals
By GreenerComputing Staff
Created 2009-12-15 11:41

LONDON, United Kingdom — Following on the release earlier this year of a report outlining how information technology can enable a low-carbon future, the Climate Group this week launched a project to keep the IT industry on course.

The new "
Pathways to Scale" project offers case studies of how companies are applying high-tech solutions to building energy efficiency, transportation, the smart grid, and other areas.

The original Smart2020 report found that the IT industry can play a role in achieving global emissions reductions of as much as 15 percent by 2020, and save companies over $725 billion by improving efficiency. Among the findings of successes and shortcomings from the follow-on report include:

  • Companies joining in partnerships with other enterprises or NGOs achieve greater successes than companies working alone;
  • Products are still often focused on a narrow niche or single area rather than offering end-to-end solutions;
  • In addition to promoting widespread behavioral change on the part of individuals, companies should optimize the energy savings on offer from their products, and use the financial savings to encourage that change;
In addition, the report's authors write that poliymakers must adopt a price for carbon, but beyond that must also lower policy barriers to cooperations, as has happened in some instances with anti-competitiveness laws.

"Pathways to Scale shows that we still have some way to go to achieving the SMART 2020 goal," Molly Webb, Director of Strategic Engagement at The Climate Group, said in a statement. "But the lessons learnt are very useful."

The report also offers a handful of recommendations that are needed to scale up smart solutions to climate problems. In addition to the development of a smart grid that links the generation and transmission of energy to its end use in offices and homes, the report's authors urge the spread of technologies, like Microsoft's Hohm and Google's Power Meter, to provide real-time energy use to everyone. 

Policies and pilots are also needed to test the application of new products, and pilots should be focused on the urban level to enable innovations to be put into play quickly.

"User-generated content drove Web 2.0, and user-generated energy information and 'the internet of things' is our future," Webb added. "With a strong global agreement to tackle climate change, ICT infrastructure will be a key enabler in the short term of carbon efficiency on a global scale."

A summary of the case studies and findings are available for download 
from GreenerComputing.com; in-depth case studies and further information are online at Smart2020.org.

Water management for 16 December 2009: McKinsey "talks on water"

https://www.mckinseyquarterly.com/article_print.aspx?L2=19&L3=67&ar=2481

Next-generation water policy for businesses and government
The solution to water scarcity, in part, will come from new technologies for better managing water as a resource. But to make these technologies more effective, business and policy leaders will need to work more closely to implement them.
December 2009 • John Briscoe
Source: Climate Change Special Initiative
Water insecurity looms as one of the great challenges of the 21st century, and it is one that policy makers and business leaders must face together. Policy makers recognize that certain technologies being developed by leading companies are critical tools for effectively managing scarce water supplies. But business leaders must do more to help shape the understanding of how good policies make it possible for technologies to be productive—and how ineffective ones do the reverse.
Public-sector leaders and nongovernmental organizations (NGOs) have long dominated the debate on water policy, but within the last five years, a growing number of progressive private-sector companies have also started to lend their perspectives on how best to effectively manage water. These companies have begun by paying much more attention to the water environment in which they function. As they develop a new generation of water-related technologies, they also increasingly influence a new generation of public policies that stimulate the development and use of these technologies. Here is how a number of them are engaging along both of these dimensions.
One group of companies, including beverage, mining, and energy businesses, has found that growing water scarcity constitutes a threat to their social license to operate. In response, some have made large donations to activist groups in the hopes of buying peace. Others have asked for water standards that they can then meet in their plants. The most far-sighted of these companies, however—with Nestlé as a leading example—recognize that while companies have to manage water efficiently behind their factory gate, society (along with companies and their suppliers) needs an equitable, efficiency-stimulating, and predictable legal and regulatory environment that governs all water uses. These companies also believe that private businesses have useful and legitimate inputs to make into the policy-formulation process, and that good business practices can guide effective implementation.
A second group of companies is developing technologies that can enable society to get more product—more food, energy, income, employment—per drop of water. There are three broad segments. The first comprises companies that develop productivity-enhancing seeds and agricultural technologies. Because agriculture accounts for more than 80 percent of water consumption in the developing world and because the productivity gains of the last round of agricultural technologies (the "green revolution") has fallen to less than 1 percent a year (from about 3 percent a year in the 1960s), these innovations are vital for better water management. The importance of genetically modified organism (GMO) crops—a core agricultural technology—is illustrated by the contrasting performance of corn in Europe, where GMOs are not allowed, and in Iowa, where 90 percent of corn is grown from using GMOs. In the last ten years, corn yields in Europe have stagnated, while in the United States productivity has grown at over 2 percent a year. Existing GMOs already use substantially lower amounts of fertilizers, pesticides, and water. And some new-generation crops will be better able to thrive despite water stress.
A second segment of companies is developing new technologies for treating water and wastewater. The process of desalination illustrates the importance in this area. The laws of thermodynamics state that it is theoretically possible to desalinate seawater by using only 25 percent of the energy currently required to do so through existing technologies. If new developments in, for example, nanotechnology and membranes allow even half of this potential to be realized, the cost of desalination will fall to a level where most cities and industries in coastal areas throughout the world can turn to it as the new source of choice. The third segment comprises companies that provide users with just-in-time and just-what's-needed information—such as on the probability of rainfall, on soil moisture, on water, and on fertilizer requirements. This is essential for energy consumption, domestic use of water, and, most important, for agriculture. Precision agriculture can produce much more crop per drop than traditional methods can, and industries and cities can use much less water too.
Executives at these leading companies know that progress in water management depends on linked advancement in technologies and policies. They have seen instances in some countries where policy shortcomings mean that many existing technologies that make more efficient use of water are not being fully employed. This has prompted a growing number of companies to engage with policy makers to ensure that key policies—such as tradeable water rights, support for intellectual-property rights, and efficiency-enhancing regulation—are implemented. In conversations with policy makers, corporate leaders highlight examples like the Murray-Darling Basin, in Australia, where an enabling policy environment means that a 70 percent reduction in water availability has had virtually no impact on agricultural production. In situations like this, policy makers know that what is needed is a "next generation" of technologies that will enable society to do more with less. And they know that the key to achieving this is a legal and business policy environment that stimulates the development of the next generation of water efficiency technologies.
Although the glass may certainly look half empty, it is also half full, not least because progressive business leaders understand that water scarcity is an issue that will affect their industries, suppliers, and the communities in which they work—and they've stepped into the policy area to help shape solutions. And as they have, policy leaders have begun to better understand the private-sector's contributions and to draft more effective enabling regulations. But more business and policy leaders need to follow the lead of their progressive colleagues. That is how we will secure further development of new technologies and the formulation and implementation of a new generation of water-management policies.


About the Author
John Briscoe is the Gordon McKay Professor of the Practice of Environmental Engineering at Harvard University and is on the faculty of the schools of engineering and applied sciences, government, and public health.

https://www.mckinseyquarterly.com/article_print.aspx?L2=3&L3=41&ar=2483

The business opportunity in water conservation
For many companies, water efficiency is a long-term requirement for staying in business, a big commercial opportunity, or both.
December 2009 • Giulio Boccaletti, Merle Grobbel, and Martin R. Stuchtey
Source: Climate Change Special Initiative
In a world where demand for water is on the road to outstripping supply, many companies are struggling to find the water they need to run their businesses. In 2004, for instance, Pepsi Bottling and Coca-Cola closed down plants in India that local farmers and urban interests believed were competing with them for water. In 2007, a drought forced the US Tennessee Valley Authority to reduce its hydropower generation by nearly a third. Some $300 million in power generation was lost.
Businesses everywhere could face similar challenges during the next few years. A larger global population and growing economies are placing bigger demands on already-depleted water supplies. Agricultural runoff and other forms of pollution are exacerbating the scarcity of water that is clean enough for human and industrial use in some regions, and changes in climate may worsen the problem. Scarcity is raising prices and increasing the level of regulation and competition among stakeholders for access to water. To continue operating, companies in most sectors must learn how to do more with less.
Achieving that goal is an opportunity as well as a necessity. Many of these same companies are developing products and services that can help business customers raise their water productivity. In agriculture, improved irrigation technologies and plant-management techniques are yielding "more crops per drop." New approaches now rolling out will help oil companies, mines, utilities, beverage companies, technology producers, and others use water more efficiently. Closing the gap between supply and demand by deploying water productivity improvements across regions and sectors around the world could cost, by our estimate, about $50 billion to $60 billion annually over the next two decades. Private-sector companies will account for about half of this spending, government for the rest. Many of these investments yield positive returns in just three years.
Making a business out of improving water efficiency won't be easy. Successful providers will have to migrate from selling equipment and components to selling solutions aimed at helping business customers reduce their water and energy use. The providers will therefore have to develop new skills and capabilities, particularly in marketing and sales, to identify and capture the higher-value-added solutions that business-to-business markets need. They must also engage more actively in shaping the regulations that will define this market—standing on the sidelines is no longer an option. Nearly every sector will be affected, whether a company is improving its own water productivity or selling equipment and services to help other companies do so.
Doing more with less
Many countries face a growing gap between the amount of water they can supply reliably to their economies and the amount they need. Assuming continued economic and population growth, by 2030 water supplies will satisfy only 60 percent of global demand (exhibit) and less than 50 percent in many developing regions where water supply is already under stress, including China, India, and South Africa. Closing the gap by increasing supply—through desalination, the drilling of deep wells, or transporting surface water—will be extremely difficult and expensive. More likely, governments will need to manage demand, either by raising the price of water or by capping the amount of it that users can draw.



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The water gap: Case studies
Case studies of three countries and one region show that there is no single water crisis—each area faces a unique set of problems.
Launch Interactive
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These moves will have a direct impact on local and multinational businesses. They need water—often in large quantities—for their processes, products, and operations. Their global assets reside in countries where rules governing water usage and prices will vary, along with access to water.
Take Chile, for example—one of the world's most important mining centers and also among the driest spots on Earth. Here the authorities allocate fresh-water rights among companies strictly, closely monitor their usage of water, and pressure them to use less of it; for example, the country's third-largest copper mine, Xstrata's Collahuasi operation, was asked to reduce its rate of water extraction to 300 liters a second by 2010, from 750 liters now. To make up the difference needed to remain in operation, the company has considered building a desalination plant or shipping in water to the mine. It is also deploying new technologies and processes, such as using less water to separate waste rock (called tailings) from ores and recycling more of the water used in the process.
Companies in several sectors are improving their water productivity. The Swedish pulp-and-paper producer SCA,1 for instance, aims to reduce its overall water consumption by 15 percent from 2005 to 2010. SCA tracks its performance through a resource-management system that collects and aggregates data on energy, water, transport, and raw-material use, as well as waste and emission levels from both production sites and business divisions. The brewing conglomerate SABMiller launched a water footprint study to compare its total water usage, from crop to consumer, in different countries and has used the findings to target improvements throughout the value chain. By 2015, it hopes to use 25 percent less water per liter of beer produced.
Several other big corporations, such as Ford Motor Company, Nestlé, and P&G, have been reducing their water usage too. The first step is usually to study where their processes use water and how much of it. Often, these companies discover a few areas where they can make significant improvements for a small outlay. A mining company, for example, found that more than 30 percent of the expense associated with water came from potable water. By fixing leaks in a single pipeline leading to a mine, the company cut the cost of potable water by 5 percent. After examining the total costs associated with water usage, it discovered that 40 percent of them came from the energy needed to run pumps.
Few companies, however, look beyond near-term water constraints, as important as they are, to a more comprehensive assessment of the longer-term business risks associated with water scarcity. Bottling companies are among the exceptions, in part because water scarcity already influences their strategic decisions, such as where to locate operations. More and more decisions about where to put assets involve such environmental considerations.
Where the opportunities are
Many solutions that will help companies use water more efficiently in their operations—from farms to semiconductor fabs, bottling plants to nuclear ones, steel mills to oil rigs—will be new products and services under development today. Global industrial players, such as ABB, GE, and Siemens, already have large water businesses and continue to develop new products in this area for large industrial users and water utilities. IBM provides technologies to measure and track water efficiency efforts and to improve water treatment and irrigation. A few oil companies are thinking about getting into the water market by selling the pumping technology they've developed for their own operations.
Roughly speaking, the broadest range of opportunities for new products and services falls into three areas: improving the productivity of water treatment and distribution, of water-intensive industrial and power processes, or of water usage in agriculture. These segments are evolving on different time lines and involve different sets of solutions, but a broad range of companies could be successful in any of these areas.
Treatment and distribution
Municipal or private water utilities and many large businesses spend hundreds of billions of dollars a year making water fit for human consumption and industrial activity and then transporting it, through pumps and pipes, from treatment plants to points of use. The costs include expenditures on new infrastructure, such as a new treatment plants—China and India alone are building hundreds of them to treat water and wastewater—and on operating and maintaining systems. Two-thirds of this spending occurs in developed countries, but much of the growth in new systems will take place in Asia and other developing regions over the next two decades. Trillions of dollars will be spent on technology, equipment, and services.
Meeting this growth with existing technologies is a huge business in itself. In China alone, we estimate, the market for the current membrane technology used to clean wastewater will grow by more than 30 percent a year over the next two decades. Introducing new technologies and services will eventually be an even bigger opportunity, both for existing players and new entrants.
In many European and US cities, for instance, the same sewage systems collect residential and commercial wastewater, runoff rainwater, and melted snow. Singapore, by contrast, collects different gradations of discharged water separately and can redirect some of it to uses (such as watering lawns and gardens) requiring lower levels of quality. Then it goes on to treatment plants for cleaning and reuse in other applications—a far more efficient approach. In Masdar City, a planned community under construction in Abu Dhabi, urban designers hope to recycle as much as 80 percent of the water the community will use. And new desalination technologies are reducing the cost (and the extensive energy) involved in desalinating water, as well as increasing its quality. As water needs grow in the developed and developing world alike, and regulations and water prices come to reflect the need to manage demand, new solutions could provide significant value to public and private buyers.
Companies already active in this space have many opportunities to introduce new products, including devices that collect wastewater from sinks to reuse for flushing toilets, technology for collecting and reusing condensate from air-conditioning systems, more water-efficient appliances, and ultraviolet disinfection technology adapted for home use (for instance, to wash clothes with treated rainwater). Hong Kong's water department has developed systems to use seawater in toilets and may soon use it to cool commercial buildings. There are also opportunities for innovators. On the drawing board today are ideas for recycling desalinated brines, low-energy technology that separates industrial waste into irrigation-quality water and valuable chemical by-products, and ways to condense fog into usable water.
Industrial efficiency
Power and industrial companies use significant amounts of water in production processes and as a coolant—16 percent of global demand today, rising to 22 percent by 2030, with about 40 percent of this growth in China. Moving water at these volumes and using it in some processes (such as steel making or power production) requires a great deal of energy, so using less water to do more also means using less energy. One bottling company, for example, is starting to deploy a new technology, called radical water, to clean bottles.2 The traditional process requires about five hours of cleaning; with the new one, the company can clean the same number of bottles in just 30 minutes, using significantly less water and energy.
Other technologies that can help businesses to reduce their water usage and energy costs include thickening paste tailings3 in mines, closed-loop systems in pulp and paper plants, and flow control and automatic shut-off valves in textile production. These solutions sometimes require trade-offs, however. Dry or closed-loop cooling systems in power plants, for instance, use up to 97 percent less water but are also less efficient. (In South Africa, Eskom uses dry-cooling technology because of the looming prospect of water shortages, but in another climate the efficiency trade-offs may not make sense.) Emerging new technologies also help companies in industries such as power to use water more efficiently in energy-intensive processes. The market for these solutions will grow dramatically in just a few years as regulations and increased water prices make using large amounts of water more costly.
Finally, many manufacturers don't have the information they need to manage the water that flows through their processes—information that is critical for improving productivity. Technology providers are starting to develop products that can help these industrial companies improve the way they track their water usage and monitor their progress.
Agriculture
Farming accounts for 71 percent of global water withdrawals, a proportion that we project will decline only slightly, to 65 percent by 2030. Water scarcity is tied both to the growing and the trading of food. India, for instance, now has just half of the water it will need in 2030, and agriculture will account for about half of the growth in water demand over the next two decades. It will account for about half of all water use in China by 2030 and for about a third in Brazil—and neither country will have enough water for all its needs in 20 years.
Finding ways to use water more efficiently in agriculture is critical. Agricultural companies are already looking for ways to design seeds and fertilizers that require less water, and better drip irrigation technologies will keep farmers from overwatering their fields. Many other sectors can provide valuable solutions under the right economic conditions. A large industrial company, for instance, could provide farming communities with pumps that it now sells to water utilities, broadening its customer base while improving efficiency in agriculture. IT solutions can help as well. They are too expensive for subsistence farmers, but water scarcity may promote consolidation and the emergence of larger farming groups that would need—and could afford—efficiency tools.
Even raising the water productivity of farms in rainy locales is a critical piece of the puzzle. Maintaining rain-fed land and improving its productivity are particularly important, since to the extent that agriculture uses water from rain, it is unnecessary to extract water for irrigation. In India, this source provides 17 percent of the total potential for agriculture to close the gap between demand and supply. The opportunities include a better fertilizer balance in fields, integrated pest management, and improved drainage systems.
Finally, financial institutions and investors can benefit from efforts to boost water productivity in treatment, efficiency, and agriculture. Banks will need to provide capital for many water productivity investments, especially when the public sector can't. The investment can be attractive for lenders, but they will have to know where and how to play. In India, for instance, some drip irrigation projects could help farmers reduce the cost of certain inputs (such as fertilizer) by up to 50 percent, depending upon the crop. Investors could capture a share of this value either as lenders or as equity holders in companies active in the drip irrigation value chain. China needs about $1.8 billion a year in capital to reduce leakage in municipal water systems. With a 22 percent rate of return, these investments could be an attractive solution for municipal utilities and their lenders alike.
Winning in water
Water is a large market, but as it grows, the rules for winning will change. Buyers of water-related goods and services, ranging across the public and private sectors, have very different needs. For many years, water has been largely a "pull" market: utilities and businesses request bids on new equipment, and the companies making it respond. As the market grows and novel technologies become available, profitable new opportunities will emerge. Today, by meeting only the minimum standards of customers, an equipment provider has little opportunity to prove that it can give them better service, with lower costs and lower levels of risk over a life cycle. New technologies will change that.
Providers will also need to engage more actively with regulators, which over the next five years are going to design water-management policies that will determine which new technologies succeed or fail. What's more, capital costs for many projects are so high that purchases of new technologies often depend on a public buyer's ability to put together complicated deals for capital financing. Tomorrow's winners will have to tackle these issues.
Developing a sales and marketing approach
Even large industrial players in the water market have found it difficult to grow in this sector. Their sales efforts, reflecting the diversity of customer segments, suffer from fragmentation across different business units. Public-sector buyers often have slow, exacting procurement processes. Corporate buyers of new water facilities often want not just components but also integrated solutions for managing water in production processes—requiring significant levels of niche-sector expertise from sellers. Highly fragmented agricultural buyers favor low-cost solutions, while desalination players are few in number and put a premium on technological innovation. Meeting these different needs requires a variety of approaches.
For this reason, large industrial suppliers typically organize their sales efforts by sector, with water-related equipment as part of the mix of solutions they provide to buyers in it. The trade-off is focus. Frequently, sales of water products take a back seat to sales efforts for higher-ticket items, such as power equipment. With no specific focus on water as a business, these suppliers feel no pressure to expand it. As a result, they are vulnerable to new entrants that specialize in the water market.
One industrial company, recognizing the opportunity to grow along with the water market, is trying to change its approach: it has created a special initiative in which sales and marketing employees across sector-based business units identify and target new opportunities. The initiative reports directly to a top executive, and team members have incentives to increase sales in water markets rather than just their respective sector-focused businesses. Over time, the company believes, a focused sales force will find new openings for higher-value services and integrated solutions.
Engage on regulation
What will shape the sector's economics, separating winners from losers, is regulation. Many water users are already actively clarifying critical positions with regulators. Water utilities, for instance, are capital-intensive businesses that make money selling water. In a world where regulators want to reduce demand for it by pricing it higher or establishing caps on its use, these utilities will need new models and a reasonable way to transition from old ones. In the United Kingdom, where water utilities have mostly been privatized, their executives are helping leaders of Ofwat, the UK Water Services Regulation Authority, to understand the nature of competition in the sector, the impact of demand management and pricing issues, and other matters that will shape the water market in coming decades. Similarly, some mining companies are working with regulators to determine the economic impact of the use of water and the options for consuming it more efficiently.
Sellers of water products and services too must participate in these debates, as some large industrial companies in the water space already do. They recognize that if regulators in a region favor water reuse as a strategy for conservation (as Singapore does), this preference will tilt the market odds in favor of companies that offer those technologies. The public-affairs units of some such companies are trying to understand how they could engage in conversations with regulators in a given region about new regulatory strategies.
Inescapably, water will become a strategic factor for companies in most sectors. All businesses will need to conserve, and many will make a market in conservation. Tomorrow's leaders in water productivity are getting into position today.


About the Authors
Giulio Boccaletti is an associate principal in McKinsey's London office, Merle Grobbel is a consultant in the Cologne office, and Martin Stuchtey is a principal in the Munich office.
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Notes
1 Svenska Cellulosa Aktiebolaget.
2Radical water, or electrochemical-activation (ECA) technology, to use its scientific name, creates unique properties in water molecules, resulting in an extremely potent yet environmentally friendly biocide. Trials and considerable R&D have proved that ECA solutions are efficacious against numerous bacteria (including MRSA), viruses, fungi (including their spores), yeasts, and many waterborne protozoa. ECA technology is particularly effective in the removal and ongoing control of biofilm, which, left unchecked, is most often responsible for the continuous contamination of the processing environment.
3 A way to thicken tailings and any remaining process water. By 2030, this technology could save as much as 4 percent of the projected gap between water supply and demand in South Africa, or 125 million cubic meters annually. It offers savings of approximately $0.60 per cubic meter of water, with payback periods of one to two years.

https://www.mckinseyquarterly.com/article_print.aspx?L2=3&L3=50&ar=2482

Water as a scarce resource: An interview with Nestlé's chairman
The chairman of Nestlé explains why water is "by far the most valuable resource on this planet" and what we must do to conserve it.
December 2009
Source: Climate Change Special Initiative
Peter Brabeck-Letmathe, chairman of Nestlé, has repeatedly warned that water is becoming a scarce resource. Water tables are falling particularly fast in regions where agricultural output is increasing, such as in India. "The water crisis that seems possible within the next 10 to 20 years will therefore quite probably trigger significant shortfalls in cereal production and, as a result, a massive global food crisis," he says.
A member of the European Roundtable of Industrialists and of the World Economic Forum's foundation board, Brabeck-Letmathe has not been shy about using his public platforms to speak out on water issues. But what is Nestlé itself doing to conserve water? McKinsey Quarterly asked Peter Brabeck-Letmathe in October. His written responses to our questions follow.

 



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The Quarterly: What challenges does water scarcity pose to a company like Nestlé?
Peter Brabeck-Letmathe: Water is, for us, a strategic issue. The main challenge is no doubt water security for the farmers who supply our factories all over the world. Farmers worldwide are the main users of water—70 percent of withdrawals, more than 90 percent of actual consumption—and they will be the most affected parties in case of a massive water shortage. In 2003, Frank Rijsberman, then the head of the International Water Management Institute, had expressed his concern: "If present trends continue, the livelihoods of one-third of the world's population will be affected by water scarcity by 2025. We could be facing annual losses equivalent to the entire grain crops of India and the US combined." This is a frightening scenario. Needless to say, such a global crisis would affect all companies, not only those from the food industry.
A second challenge is the water we use in our bottling and manufacturing processes. In bottled water, quality matters much more than quantity. Quality is also key for some of our processes: water, for instance, is still one of the best solvents that we use, among other things, to gently decaffeinate coffee. Last but not least, consumers need access to safe and high-quality water to prepare many of our products.
The Quarterly: What steps is Nestlé taking to address these issues?
Peter Brabeck-Letmathe: Water has been on the Nestlé corporate agenda long before environmental policies and sustainability became an issue; the first wastewater-treatment plant for one of our factories was built back in the 1930s. Despite the fact that we are a modest water user,1with less than 1.8 liters per dollar of sales, we have made huge efforts to reduce water withdrawals for our factories. Withdrawals were close to 5 liters per dollar of sales some ten years ago. They are now below 2 liters, and we continue our efforts to further reduce them. At the same time, we make sure the water withdrawn is returned to nature in good quality.
There are other ways for us to contribute to reducing water abstraction. One is by reducing waste in the supply chain. In more concrete terms, this means doing our job and extending our efficient business processes to areas where less efficient operators are active. Let me illustrate this with an example. In a traditional milk supply chain—with open, uncooled containers from farm to consumer, on oxcarts or bikes—losses of milk are on the order of 16 to 27 percent.2 When Nestlé collects milk directly from farmers and uses refrigerated trucks to transport it, these losses go down to less than 0.6 percent.
Based on the total amount of milk Nestlé purchases directly each year in countries such as Pakistan, India, and China (that is, in relatively difficult climatic conditions) and further on the average water requirements for producing milk on farms, this reduction in waste means savings on the order of 815 million to 1,375 million cubic meters of water a year.3 The total water savings on our directly purchased milk alone—thanks to our logistics, processing, and packaging—outweigh our total annual water withdrawals (147 million cubic meters of water a year) five to eight times. And what is key: the positive impact of our efficient supply chain for milk happens to be greatest in countries where the water situation is most dire.
The Quarterly: Would a price for water help to improve water productivity, and how would introducing such a price affect Nestlé's business?
Peter Brabeck-Letmathe: Water—by far the most valuable resource on this planet—is treated as if did not have any value at all. We often do not even know the cost of providing it; the true number is buried under open and hidden subsidies, taxes, and the sunk costs of municipal and regional water and irrigation departments. This is particularly true for water used in agriculture. The problem is not that farmers use water; the problem is that they very frequently use it inefficiently. We see sprinklers turning at noon, unlined irrigation canals where water is seeping away faster than it actually flows, and a lack of both interest and incentives to invest in drip irrigation. Water, too often, has no price. It is seen and treated as a free good, or the price for farmers is far below what others have to pay.
Full cost recovery must be implemented for all those who today get massively subsidized municipal tap water (also to fill their swimming pools) and who can actually afford to pay. This is necessary to finance the huge amount of infrastructure required to reduce leakage losses in municipal water supplies—up to 70 percent—and to provide the financial means to extend them to those who do not have access. That not only includes the close to one billion people with no access to safe water but also the far more than two billion people with access to so-called improved water sources, which in reality often means that women have to carry the daily water needs of their families some kilometers from the source to the home.4
What do the principles of full cost recovery mean for a company? Nestlé and the consumers of bottled water are already paying fully for the infrastructure: the bottling plant and the distribution network. Due to a lack of transparency regarding water tariffs in general, it is not always quite clear whether the tariff paid by a company for withdrawn municipal water for production and for wastewater effluent treatment always covers the full infrastructure costs. In areas where Nestlé relies on municipal water, the cost impact of an assumed increase of tariffs to, say, the levels found in Germany, would be on the order of a very small fraction of cents per dollar of our sales, based on our average of less than 1.8 liters of water withdrawn per dollar of sales. That's not very much.
Covering the full cost of water infrastructure is much more difficult for farmers. But it is also possible. In Oman, farmers draw from a 4,500-year-old water system that is still functioning.5 Once the water arrives at a village, from underground sources and mountain springs, channeled over many kilometers, all villagers, guests, and travelers get free access to the drinking water they need. The canal then goes to the mosque: water is also free for ceremonial washing, and some is set aside and sold to finance the mosque and the school. After that, the water becomes private property in defined shares, days, hours, or minutes of rights to use it for irrigation. The rights are inherited and, even more important, tradable. In frequent auctions, parts of the water rights can be sold and purchased or leased within the village community. If a farmer does not need water temporarily, he leases it to another farmer who has additional land available to grow a crop. If a farmer wants to invest in more efficient irrigation, he can finance this investment by selling water rights permanently. Thus, water gets a market price set by those who know best: the farmers. This is an extremely strong incentive to use water efficiently.6Since the market price varies over the year, this is a much smarter approach to efficiency than, for example, so-called water footprint calculations. And since farmers trade among themselves, the price places no additional financial burden on them.
The Quarterly: At what level is leadership on this issue most critical—global or local, public or private?
Peter Brabeck-Letmathe: Probably, local public leadership is most important. Political leaders within an area, in dialogue with the main stakeholders, have to develop and implement a clear strategy to manage water abstraction efficiently in order to overcome the risk of structural water shortages—a strategy that also includes market mechanisms. Success is possible neither piecemeal nor in isolation; it requires solutions found through multistakeholder dialogue. Success will also require full involvement and participative responsibility. At a global level, a framework is needed to make sure local measures can succeed. Among the requirements at the global level: start addressing the issue of water subsidies that risk distorting markets for the necessary flows of virtual water (embedded in farm products) between regions. Another requirement: liberalize agriculture, the sector where efficient water use is most urgent.

Notes
1 Both in comparison with Nestlé's competitors and, much more, with other sectors, which withdraw 120 litres or more per dollar of turnover. See Watching Water: A Guide To Evaluating Corporate Risks in a Thirsty World, JPMorgan, 2008; and Parry Norling, Frankie Wood-Black, and Tina M. Masciangioli, Water and Sustainable Development: Opportunities for the Chemical Sciences, Washington, DC: National Academies Press, 2004.
2 According to the UN's Food and Agriculture Organization, 16 to 25 percent of milk is lost between farms and consumer households in Tanzania (according to season) and 27 percent in Uganda.
3 These figures cover only the milk Nestlé collects directly from farmers.
4 See Progress on Drinking Water and Sanitation, UNICEF and World Health Organization, 2008.
5 See an interview with Peter Brabeck-Letmathe from the World Economic Forum Annual Meeting 2008 (youtube.com/watch?v=C7smujmaMfE).
6 See S. K. Jalota, A. Sood, J. D. Vitale, and R. Srinvasan, "Simulated crop yields response to irrigation water and economic analysis," Agronomy Journal, 2007, Volume 99, Issue 4, pp. 1073–84.

Top 7 Business Sustainability Challenges for 2010

thanks to Tom for this one



 
The Network for Business Sustainability released a report today describing the top sustainability challenges facing business in 2010.
 
The top two challenges will be to measure and value ecological footprint, and to embed sustainability in corporate culture. A report describing all seven challenges is available at www.nbs.net.
 
These challenges were identified and prioritized by a council of organizations leading sustainability (see members at www.nbs.net/aboutTeam_Leadership.html).
 
We hope the report galvanizes researchers to study the questions posed and inspires industry and funding agencies to support these efforts.
 
Please let me know if you are interested in undertaking or supporting work on any of the report's priorities.
 
Sincerely,
Tom
 
Tom Ewart
Managing Director
519-661-2111 x80094

Network for Business Sustainability
Business. Thinking. Ahead.

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14.12.09

Water management for 14 December 2009: CDP water initiative exposes disclosure challenges

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CDP water initiative exposes disclosure challenges

Environmental Finance, 26 November 2009 - Investors have welcomed the launch of a water disclosure programme by the Carbon Disclosure Project (CDP), but the initiative exposes a plethora of challenges in understanding the risks and opportunities associated with water scarcity.

The CDP hopes to replicate with water its success in encouraging companies to disclose investment-relevant information about climate change. Next year, it is to send 300 of the world's largest "water-intensive" companies a questionnaire about the risks and opportunities they face in relation to water.

Meanwhile, consultancy Irbaris has written a report, The Case for Water Disclosure, to help provide businesses with a system for reporting their use of water and to assess their exposure to changing patterns of water availability.

It claims the impacts of changing patterns of water availability are not recognised nor well understood by most businesses even though they are set to worsen as demand for water increases and its supply is threatened by climate change.

"Investors need to be concerned about water because it is already impacting companies' operations and costs and it will continue to do so," states the report. "Some investors already understand this, but they lack reliable comparable information on which to base their assessments."

While the report says the disclosure project will help fill this knowledge gap, it admits the issue is complicated and insists the "measurement and reporting of water availability and usage is much more complex than for carbon".

"Whereas it does not matter whether a tonne of carbon dioxide [CO2] is emitted in Sydney or Stockholm (in terms of its environmental impact), the impact of extracting a cubic metre of water varies enormously with geography."

Second, "the source and use of the water also make a big difference – the impact of using water that has fallen recently as rain is often different from that of withdrawing water that has been stored in an aquifer for millennia," says the report.

"While standards to capture these complexities are being developed, there is no consensus yet on what exactly the standards should be, never mind consistent or widespread adoption of such standards," it adds.

Irbaris' William Lynn, one of the authors of the report, said ultimately "different types of disclosure may emerge for different regions and industries".

The initiative is being supported by financial institutions including Norges Bank Investment Management, Schroders, APG Asset Management and Dexia Asset Management, but Lynn insisted that smaller companies and investors are needed to engage in the debate and realise the seriousness of the issue.

"Companies can pay to emit an extra tonne of CO2, but there is no substitute for water," he said.

Alternative Energy newclips for December 14, 2009: Eco light bulbs or not? and Real Estate management energy ratings

http://news.bbc.co.uk/2/hi/uk_news/magazine/8406923.stm

Why eco-light bulbs aren't what they seem
By Ruth Alexander 
BBC's More or Less 

Save the planet, switch to eco-light bulbs. So goes the refrain. But are these as bright, long-lasting and energy efficient as is often claimed?

The traditional incandescent bulb is on the way out. European law means people will be encouraged to use longer-lasting, energy-efficient lights instead.

But many remain unconvinced that the common alternative - compact fluorescent lamps (CFLs) - are up to the job.

European legislation has already banned the manufacture and import of 100-watt incandescent bulbs. In 2011, 60-watt bulbs will go, and 40- and 25-watt bulbs will be banned by 2012.

But are these bulbs quite as good as is claimed?

BRIGHTNESS

Think those compact fluorescent bulbs are not as bright as the old-style lights they replaced? You are probably not imagining it.

A guide to the amount of light given by a CFL bulb is given on its box as a comparison to the wattage of an incandescent bulb. But the European Commission says

this can be misleading.

"Currently, exaggerated claims are often made on the packaging about the light output of compact fluorescent lamps - for example that an 11-12-watt compact fluorescent lamp would be the equivalent of a 60-watt incandescent, which is not true."

The Lighting Industry Federation says the claims on the packaging are the nearest equivalent to the wattage of a soft white light bulb.

Liz Peck, of the Society of Light and Lighting, says this is because CFLs have a phosphor coating. "They compare like for like, but the trouble is people tend to use the clear bulbs at home and it's not equivalent to those."

The European Commission's advice is to divide the wattage of a traditional light bulb by four to get the equivalent brightness. So, to get the brightness of a traditional 60-watt bulb, choose a 15-watt CFL bulb.
is on BBC Radio 4 on Friday 11 December at 1330 GMT, and repeated Sunday 2000 GMT

  •  Or catch up on the
But the Lighting Research Center in the United States goes further.

"We believe in the divide by three rule," says associate director Russell Leslie, who recommends a 20-watt CFL to match a 60-watt incandescent bulb. "The equivalent ratings you see on the box are usually got by testing in a laboratory environment."

At home, brightness varies as conditions change. "A compact fluorescent light is designed to provide maximum light output at 25C, and when it gets hotter or colder than that, its brightness can be reduced.

"If your bulb is in a recessed fixture in the ceiling, and it gets warm, you might see a 10-20% reduction in its light output."

And studies show CFL bulbs can get 20% dimmer over time.

New European regulations expected next year mean manufacturers will have to display lumens - a measure of light output - more prominently than wattage on bulb packaging.

LIFESPAN

Another complaint is eco bulbs - supposed to last for years - frequently conk out early.

"Unfortunately you get what you pay for," says Ms Peck. While a branded bulb from a well-known manufacturer may indeed last the promised 10 years, one from a supermarket budget line may not.

But even branded bulbs don't always last as long as expected - this is because the lifespan given is an average.

When a batch of bulbs is tested, they are turned on for three hours, then off for 20 minutes over and over again until half the batch fails. This point in time is then decreed the average life.

It is often 10,000 hours. As no-one adds up the hours a light is on over its lifespan, this is translated as 10 years, on the assumption that the bulb will be on for an average of three hours a day.

But as half the bulbs will fail before 10,000 hours, a shopper may be unlucky enough to pick a dud that will fail after just 2,000 hours. However, the main manufacturers do their best to make bulbs that cluster around the average life mark, says the Lighting Industry Federation.

And what you do with a bulb can affect its lifespan, says Mr Leslie. Continuously turning it off and on every 15 minutes, for example, will more than halve its expected lifespan.

ENERGY EFFICIENCY

Just how energy efficient are these lights? The European Commission, the Energy Saving Trust and manufacturers say CFLs use up to 80% less electricity than traditional bulbs.

How is this number calculated? It's worked out by comparing the best compact fluorescent lamp's wattage with the wattage of an equivalent incandescent bulb, says a spokeswoman for the European Commission.

But that results in a 5:1 energy ratio between the two - a claim it says is an exaggeration when manufacturers use it.

And it's the "up to" in this 80% claim that is important. The EC spokeswoman says the saving can be as low as 60%.

John Henderson, an energy-use expert from the consultancy Building Research Establishment, says although CFLs are better than traditional bulbs, policy-makers should not draw simple conclusions from simple sums about their energy saving potential.

"When you see an 80% savings figure on the side of a low-energy light bulb, it doesn't actually mean that you're going to save 80% lighting energy, 80% carbon emissions, and 80% costs."

Traditional bulbs expend about 95% of their energy producing heat. The European Commission considers this to be heat loss. But Mr Henderson disagrees.

"Let's say your house uses 1,000kWh a year to produce the light you use. If you were to replace all the old-fashioned light bulbs with the modern low energy lamps, you might expect an 80% reduction - 800kWh.

"However you'd find about 60% of that 800kWh would get automatically chucked back in by your thermostat-controlled heating system. A typical heating system is only about 75% efficient. So the actual figure you end up with is more like 240kWh a year, rather than the 800kWh you expected."

That number is only a rough guide, as most homes have gas central heating which is cheaper and less carbon intensive than an electric heating system.

Meanwhile, the Institute of Lighting Engineers is considering changing its estimate of the energy savings represented by CFLs from 80% to 70%.

This is because the power factor of CFLs is low, which means a utility company needs to use more energy to get these lights to work, which can also cause disruptions in the power network.

Ms Peck, of the Society of Light and Lighting, says CFLs have improved in recent years - they flicker less, and warm up faster. Nor should people worry that they contain mercury, as it is a very small amount.

There are other energy-saving options, she says, such as halogen tungsten lights which are about 30% more efficient than incandescent bulbs.

And technology is developing fast, so it could be only a few years before people are lighting their homes with LED lights, which experts say have the potential to be more efficient than CFLs.

INCANDESCENT LIGHT BULB Traditional 100W light bulb

  •  Glass mount carries electrical connection from base to the filament
  •  Electric current passes through filament which heats up and emits light
  •  Inert gas inside bulb protects filament and improves luminescence COMPACT FLUORESCENT LAMP 'Energy saving light bulb'
  •  Electrical current emitted from electronic 'ballast'
  •  Current flows into gas filled tube causing it to emit invisible ultraviolet [UV] light
  •  UV light causes phospor coating inside tube to emit visible light
  •  Requires 20-23 watts to generate same light as traditional 100W bulb
    Story from BBC NEWS:
    Light bulbs compared
    http://news.bbc.co.uk/go/pr/fr/-/2/hi/uk_news/magazine/8406923.stm

    Published: 2009/12/11 11:45:13 GMT

    © BBC MMIX


     


    http://www.environmentalleader.com/2009/12/11/real-estate-managers-agree-to-building-energy-use-label/?graph=full&id=1

Real Estate Managers Agree to Building Energy Use Label
Posted By Environmental Leader On December 11, 2009 @ 9:40 am In Business ServicesBusiness-to-BusinessConstruction & RefittingEmissionsEnergy EfficiencyLargeProducts & Planning | No Comments
building EQMajor real estate firms have signed up for a pilot program that would help building owners, prospective tenants and buyers ascertain the energy efficiency of a building. The Building Energy Quotient program – Building EQ [1] for short – is administered by the American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE [2]).

The Durst Organization, the U.S. General Services Administration and BNIM Architects are among the initial participants in Building EQ.

The program, which was unveiled [3] earlier this year, has two rating types for commercial buildings: as Designed (asset) and In Operation (as operated), according to a press release [4].

The ratings system will give buildings a certificate (see image) detailing data on actual energy use, energy demand profiles and indoor air quality, among other factors that can evaluate a building's energy use.

Domestically, building energy use disclosure is already part of the law in California, Washington, D.C., Austin, Texas and Washington State. The European Union and Australia also have such mandates.

Recently Santa Monica has adopted [5] stricter building codes related to energy efficiency and green building.

Meanwhile, an ambitious mandate to reduce energy use at New York City commercial buildings has hit stumbling blocks. Building owners, citing cost as the major issue, mounted opposition to Mayor Michael Bloomberg's plans for energy-efficient buildings, forcing him to drop one of the key initiatives [6] for reducing greenhouse gas emissions.

A number of entities are participating in the ASHRAE pilot. Here is the list.

- The Durst Organization, a New York City real estate firm that owns 4 Times Square, 1155 Avenue of the Americas and One Bryant Park.

- The U.S. General Services Administration, the federal agency that acquires and manages federal buildings.

- Wright Runstad and Co., Seattle.

- Ashforth Pacific, Portland.

- BNIM Architects, Kansas City, Mo., a design firm, is including The Omega Center for Sustainable Living in Rhinebeck, N.Y.; the Internal Revenue Service, Kansas City Campus, Kansas City, Mo.; and the Fayez S. Sarofin Research Building, home of the Brown Foundation Institute of Molecular Medicine for the Prevention of Human Diseases, the University of Texas Health Science Center, Houston.

- Hines, Houston, will place high-profile properties from five major U.S. market in the pilot.

- The Detroit-Wayne Joint Building Authority.

- The Michigan Department of Management and Budget, which acquires and manages properties for many Michigan agencies.

- Russell Development Co., Portland, will include 200 Market Building.


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URL to article: http://www.environmentalleader.com/2009/12/11/real-estate-managers-agree-to-building-energy-use-label/

URLs in this post:
[1] Building EQ: http://www.buildingeq.com/
[2] ASHRAE: http://www.ashrae.org/
[3] unveiled: http://www.environmentalleader.com/2009/06/26/ashrae-launches-prototype-building-energy-label/
[4] release: http://www.ashrae.org/pressroom/detail/17380
[5] adopted: http://www.environmentalleader.com/2009/12/09/santa-monica-pushes-for-stricter-green-building-laws-while-nyc-backs-down/
[6] initiatives: http://www.environmentalleader.com/2009/10/12/nyc-may-audit-large-buildings-for-energy-efficiency/

Carbon newsclips for 14 december 2009: Procrastination. procrastination -- COP15, continued

http://www.timesonline.co.uk/tol/news/environment/copenhagen/article6955237.ece

Copenhagen stalls decision on catastrophic climate change for six years
Protestors are restrained in Copenhagen
Ben Webster, Environment Editor, in Copenhagen
The key decision on preventing catastrophic climate change will be delayed for up to six years if the Copenhagen summit delivers a compromise deal which ignores advice from the UN's science body.
World leaders will not agree on the emissions cuts recommended by the Intergovernmental Panel on Climate Change (IPCC) and are likely instead to commit to reviewing them in 2015 or 2016.
The delay will anger developing countries who, scientists say, will face the worst effects of climate change despite having contributed relatively little of the man-made greenhouse gases in the atmosphere.
A draft text published by the UN says that there should be a review in 2016, which could result in an "update of the long-term global goal for emissions reductions as well as of the adequacy of commitments and actions".
The Times has learnt that negotiators from developed countries are planning to use the idea of a review to justify failing to agree the 25-40 per cent cut in the 1990 level of emissions by 2020, recommended by the IPCC.
Even the most ambitious provisional offers made by all the countries amount to a reduction of only 18 per cent.
Tony Blair, the former Prime Minister, said leaders would be unable to deliver a deal in line with what the IPCC had recommended.
In an interview yesterday with The Times in Copenhagen, he said: "It would be a big mistake if we failed to get an agreement because we didn't meet the highest expectations people have.
"Get the agreement, get it under way, and then understand you will inevitably have to change and adjust as you proceed.
"If you actually manage to cut emissions by 18 per cent by 2020, you would have made a very, very big change in the way economies work," he said, before adding: "Don't let the best be the enemy of the good."
A joint report by Mr Blair's office and the Climate Group, an environmental body backed by some of the world's biggest companies, including BP, HSBC and Google, said that, even if all the provisional offers were delivered, emissions of CO2 in 2020 would still be 5 billion tonnes higher than the atmosphere could safely accommodate.
This would mean that global temperature would rise more than 2C above pre-industrial levels, with the result that large parts of the world would become uninhabitable.
The joint report, published yesterday, proposed a review of targets in 2015 to allow "scaling up of ambition".
Countries are unlikely to improve on their provisional offers over the next five days, because the US has made clear it will not be raising its own relatively weak provisional target for cutting emissions.
President Obama has offered to cut US emissions by 4 per cent on 1990 levels by 2020, subject to approval by the US Congress. The EU has committed to a 20 per cent cut over the same time scale, but said it would raise this to 30 per cent if other countries made comparable efforts.
Mr Blair discussed Mr Obama's offer last week with Todd Stern, the US chief climate negotiator, and agreed that the focus should be on accelerating US emissions cuts in the decade after 2020 rather than before.
Mr Blair said that, while the scientific evidence of man-made global warming was very strong, it was much less clear how quickly temperatures would rise.
"When you come to very precise dates, percentages and so on [. . .] then the figures are somewhat more fudgeable.
"The important thing is to give a clear direction out of this conference. Don't fixate on the precise percentage," he said.
A source close to Britain's negotiating team said Britain would continue to press publicly for a deal in line with the IPCC's recommendation, but acknowledged that the targets emerging from the summit would need to be reconsidered at a later date.
Bernarditas Muller, lead negotiator for the G77 and China group of developing countries, said putting off the most difficult decisions on emissions cuts would be a betrayal of commitments made by rich countries under the UN Climate Convention.
"Developing countries have the most to lose if we do not agree a just and ambitious outcome in Copenhagen. We are simply asking developed countries, 'Don't shirk your responsibilities. Just do what you have already agreed to do under the Climate Convention'."
Smaller developing countries were excluded yesterday from a meeting in Copenhagen of environment ministers from about 40 countries.
Ed Miliband, the Energy and Climate Change Secretary, said after the meeting: "We're now getting close to midnight in this negotiation and we need to act like it.
"That means more urgency to solve problems, not just identify them, more willingness to shift from entrenched positions and more ambitious commitments."
The Prince of Wales will address the summit tomorrow and Gordon Brown will meet other leaders in Copenhagen on Wednesday.
About 120 Prime Ministers and Presidents will attend the final day of the summit on Friday.



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Who's To Blame For Climate Change – Will A Jury Decide?
Posted By Environmental Leader On December 11, 2009 @ 2:22 am In Carbon FootprintEmissionsGuest ColumnPolicy & Law | No Comments
faegreCourts are grappling with the tough legal and policy questions posed by current large-scale climate change litigation across the country. In recent months, federal courts have issued three significant decisions about the viability of nuisance claims relating to climate change impacts.

Two appellate court decisions open the door to broad legal claims against utilities and other greenhouse gas (GHG) emitters for injunctive relief and compensatory and punitive damages. The third, issued by a district court, shut such claims down but will likely be appealed.

What are the implications of these decisions for corporate liability, climate change claims and environmental claims in general?

On Sept. 21, the Second Circuit issued a much anticipated decision in Connecticut v. American Electric Power. In the massive 139-page opinion, the court resurrected lawsuits brought by New York City, several states, and private land trusts against electric utilities that allegedly emit 10% of America's man-made greenhouse gases. Under federal nuisance theories, the plaintiffs seek an injunction forcing the utilities to cap and then reduce emissions.

The district court had dismissed the suits in 2005 as too entangled in political and regulatory matters to be justiciable. The Second Circuit disagreed, finding that federal courts "have long been up to the task of assessing complex scientific evidence." The court broadly invoked traditional Restatement doctrines of tort relief as providing manageable standards for litigating the dispute.

The Second Circuit also found the plaintiffs had standing since they alleged that actual destruction had begun and that emissions have a cumulative effect. By alleging the utilities "contributed" to the kinds of injuries they suffered, the plaintiffs demonstrated that the injuries were "fairly traceable" to the defendants' actions. At this early stage, the plaintiffs need not pinpoint specific harms caused by particular utilities or show that the utilities' emissions alone caused their injuries.

Less than a month later, the Fifth Circuit weighed in with a similar decision in Comer v. Murphy Oil. There, a putative class of Gulf Coast residents and property owners sued numerous energy, fossil fuel, and chemical companies for Hurricane Katrina damage.

Instead of an injunction, the plaintiffs sought compensatory and punitive damages, contending that the defendants' combined emissions increased global surface air and water temperatures, thus raising sea levels, thus compounding the storm, thus destroying plaintiffs' property. The Fifth Circuit agreed with the Second Circuit that such claims need not be resolved by the political branches, and likewise found the plaintiffs had "clearly satisfied" standing requirements by merely alleging "actual, concrete injury." (The Fifth Circuit did, however, refuse to revive a set of unjust enrichment, civil conspiracy, and fraudulent misrepresentation claims, which the district court had similarly dismissed.)

Meanwhile, on Sept. 30, the Northern District of California issued a decision in Native Village of Kivalina v. ExxonMobil Corp., dismissing an Alaskan native village's claims for the cost of future relocation necessitated by global warming. Alleging federal nuisance, the Village sued 24 oil, energy and utility companies for contributions to "excessive" emissions of GHGs. Expressly disagreeing with the Second Circuit, the Kivalina court concluded that nuisance concepts provided no real guidance for resolving global problems caused by GHGs and that the Village had no standing. "It is illogical to conclude," the court held, "that the mere contribution of greenhouse gases into the atmosphere is sufficient to establish that a plaintiff's injury is fairly traceable to a defendant's conduct."

The combined effect of these decisions is hard to surmise. First, none of these cases has yet to progress beyond the pleadings stage. An appellate decision that a complaint meets the low threshold for survival is a far cry from one upholding a verdict or injunction. Indeed, the Fifth Circuit expressed skepticism that the Katrina case could survive to trial, noting that the "worldwide effects of greenhouse gas emissions may … make it difficult … to show proximate causation."

Moreover, the defendants in Connecticut and Comer have since filed petitions seeking en banc circuit review, which if granted, will lead to broader appellate review and possibly a Supreme Court appeal before discovery can begin. (The plaintiffs in the Kivalina case have likewise noticed an appeal to the 9th Circuit.)

A third scenario is that Congress or the EPA will intervene to regulate GHG emissions. This may not have much impact on the Katrina claims for past damages, but it could impact the injunctive relief sought in Connecticut and limit the potential for similar future lawsuits. The EPA's recent "endangerment" finding suggests that the EPA is at least on the path to such regulation. Although this finding is already being challenged in court, as is also the probable path for any subsequent emissions regulation, this may still put additional pressure on Congress to act.

Industry can at least take comfort that the Second Circuit's expansion of federal nuisance appears confined to climate change issues. In particular, the court's analysis contrasting the current lack of federal GHG regulations with the breadth of federal clean water regulations supports a growing belief that federal common law nuisance cannot exist in the clean water context. As Congress did with the 1972 Clean Water Act amendments, here, Congress or EPA could later displace federal GHG nuisance claims through direct regulation of emissions.

Nevertheless, the two appellate decisions present the possibility that judges and juries, rather than legislatures and agencies, could exact a "price" on GHG emissions in the short term, either by capping prospective emissions or ordering damages for past emissions.

Jonathan W. Dettmann, Delmar R. Ehrich and Krisann Kleibacker Lee are members of the environmental and litigation groups at Faegre & Benson [1] LLP, an international law firm headquartered in Minneapolis. They can be reached via e-mail respectively at jdettmann@faegre.com, dehrich@faegre.com and kklee@faegre.com.


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Climate talks: draft blueprint sees 1.5-2.0 C maximum warming

AFP, 11 December 2009 - The first official draft blueprint for a deal at the UN climate talks sees targets of limiting global warming to 1.5 or 2.0 degrees Celsius (2.7 or 3.6 degrees Fahrenheit), according to a document seen by AFP on Friday.

The lower temperature is embraced by small island states and many African nations badly threatened by climate change.

The higher target has been supported by rich industrialised nations and emerging giants such as China, India and Brazil.

The temperatures relate to a total rise in warming over pre-industrial times.

The draft is to be submitted to environment ministers from around the world, with the goal of having it endorsed at a summit on December 18.

The talks are taking place under the 194-nation UN Framework Convention on Climate Change (UNFCCC).

If all goes well, a political agreement in Copenhagen would be followed by meetings next year to flesh out key details.

The envisioned global pact would take effect from 2013, after current pledges expire under the UNFCCC's Kyoto Protocol.

The proposed draft is put forward by the Ad-hoc Working Group on Long-Term Cooperative Action, or AWG-LCA, one of the two negotiating pools in the 12-day talks in Copenhagen.

Its task is to spell out a "shared vision" for combatting climate change in the decades to come.

The text carries many brackets, which denote disagreement.

On the question of a target for warming, it reads:

"Parties shall cooperate to avoid dangerous climae change, in keeping with the ultimate objective of the Convention, recognizing [the broad scientific view] that the increase in global average temperature above pre-industrial levels ought not to exceed [2 C] [1.5 C]."

The draft text leaves open three possible targets for the overall reduction of global carbon emissions by 2020, compared with 1990 levels: by 50 percent, by 80 percent and by 95 percent.

Industrialised countries favour the 50 percent goal, while major emerging economies led by China have balked at any such target unless it is made clear that rich countries will assume the near totality of the burden.

For rich countries, which acknowledge their historical responsibility for global warming, the bracketed options for CO2 cuts by 2050 in the text range from 75-85 percent, "at least 80-95 percent", and "more than 95 percent", all measured against the same 1990 benchmark.

http://www.canada.com/technology/Fake+news+release+links+Canada+major+emission+reduction+targets/2338477/story.html

Fake news release links Canada to major emission reduction targets
 
 
BY KELLY CRYDERMAN, CALGARY HERALDDECEMBER 14, 2009 4:31 PM
 
 
A bogus website that went online Monday morning mimics the official Environment Canada website and announces that Canada has promised to cut its greenhouse gas emissions by 40 per cent below 1990 levels by 2020. The Prime Minister's Office dismissed the website as a 'childish prank.'
 
A bogus website that went online Monday morning mimics the official Environment Canada website and announces that Canada has promised to cut its greenhouse gas emissions by 40 per cent below 1990 levels by 2020. The Prime Minister's Office dismissed the website as a 'childish prank.'

COPENHAGEN — The federal government was stung Monday by a sophisticated hoax that made it appear the Canadian delegation had publicly committed to bold emission reduction targets and tens of billions in new aid to help African nations.

The deception involved a number of fake news releases and set Canadians in Copenhagen's Bella Centre abuzz Monday. It also led to a heated dispute between government spokesman Dimitri Soudas and Equiterre founder Steven Guilbeault, a climate change activist who Soudas accused of being the source of the hoax.

Guilbeault maintains he had nothing to do with it.

"I have nothing to hide," he said, adding he has been up front with his view that Canada has weak climate change policies. He has demanded an apology from the government.

Soudas responded to the hoax in an e-mail, saying "more time should be dedicated to playing a constructive role instead of childish pranks."

It began with an initial phoney news release, which laid out the supposed new Canadian targets and action plan.

That e-mail was followed by others, one of which appeared to be a government indictment of the first hoax — which stated Canada's standing with the international business community had been damaged, and the Canadian government would "seek the full measure of legal recourse against these criminals under Danish and international law."

Another hoax news release had the Ugandan delegation at the international climate change talks reacting with elation to Canada's news.

The news releases were posted on a fake Environment Canada website, and the first appeared on real-looking, but bogus, Wall Street Journal and United Nations Conference of the Party (COP) sites.

It's unclear who's behind the news releases.

The spoof prompted speculation that the Yes Men, a social advocacy group that often impersonates its targets, was responsible for the hoax. However, the group did not respond to a request for comment.

Falsely quoting federal Environment Minister Jim Prentice, the first hoax release said the Canadian government is setting binding emissions reductions targets of 40 per cent below 1990 levels by 2020 and at least 80 per cent by 2050. The release said that is "in line with the recommendations of the Intergovernmental Panel on Climate Change (IPCC) and approaching the levels demanded by the African Group."

The release also committed Canada to eventually spending up to five per cent of its Gross Domestic Product to help developing countries adapt to climate change and develop alternative energy sources.

The bogus news release said Canada would send Africa $13 billion in 2010, the first year of the commitment period.

In reality, Canada is still committed to reducing greenhouse gases by 20 per cent below 2006 levels by 2020. And Ottawa has not yet made any firm funding commitment to developing countries.

Every day of the conference, which runs Dec. 7-18, Ottawa has been lambasted for not setting more ambitious targets and failing to meet Kyoto Protocol obligations.

Speaking to reporters Monday, Prentice dismissed the hoax.

"My focus is the negotiations," the minister said. "Certainly there are many things going on the periphery of those negotiations, and you know, some of them are undesirable. And there are other things that will continue to happen that will be undesirable, including press releases that are a hoax."

Gerald Butts, president and CEO of World Wildlife Fund Canada, said the hoax is not a tactic he would endorse, but it's one that made him laugh.

"It's going to be pretty effective in pointing out what a gap there is between what the government is putting on the table and what people want," Butts said.

Speaking later in the day, Guilbeault said he is also offended because the Canadian government accused him of being unpatriotic, due to his criticism of its policies.

"It's scandalous," said Guilbeault. "It seems like we've lost freedom of speech in Canada."

kcryderman@theherald.canwest.com
© Copyright (c) Canwest News Service

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