Costs of delaying climate change action may exceed costs of action

Reports on climate change, almost all suggesting action rather than inaction, are now being published so frequently that they threaten to overwhelm GallonDaily. We know our readers are interested in the full range of environmental and sustainability issues facing business in Canada so we will deliberately limit our coverage of climate change matters to a maximum of two articles each week. We will try to select those topics which may have the greatest impact on business and on public policy affecting business.

One of the more significant reports this week comes from the U.S. President’s Council of Economic Advisers. Focussing on the economics of climate change and with an extensive bibliography, the report makes clear that costs will be substantially lower if action is taken sooner rather than later. Among the findings:

  • if a delay [in action on climate change] causes the mean global temperature increase to stabilize at 3° Celsius above preindustrial levels, instead of 2°, that delay will induce annual additional damages of approximately 0.9 percent of global output. To put this percentage in perspective, 0.9 percent of estimated 2014 U.S. GDP is approximately $150 billion.5 The next degree increase, from 3° to 4°, would incur greater additional annual costs of approximately 1.2 percent of global output. These costs are not one-time: they are incurred year after year because of the permanent damage caused by additional climate change resulting from the delay.
  • the second type of cost of delay is the increased cost of reducing emissions more sharply if, instead, the delayed policy is to achieve the same climate target as the non-delayed policy.
  • any short run gains from delay tend to be outweighed by the additional costs arising from the need to adopt a more abrupt and stringent policy later. An analysis of the collective results from research suggests that the cost of hitting a specific climate target increases, on average, by approximately 40 percent for each decade of delay. These costs are higher for more aggressive climate goals: the longer the delay, the more difficult it becomes to hit a climate target. Furthermore, the research also finds that delay substantially decreases the chances that even concerted efforts in the future will hit the most aggressive climate targets.
  • it is cost-effective to start with a relatively less stringent policy, then increase stringency over time, and the models typically build in this cost-effective tradeoff. However, most models still find that immediate initiation of a less stringent policy followed by increasing stringency incurs lower costs than delaying policy entirely and then increasing stringency more rapidly.
  • delaying action is much costlier for more stringent targets… the median additional cost (global present value) for a 20-year delay is estimated to be $0.7 trillion for 650 ppm CO2e but a substantially greater $4.7 trillion for 550 ppm CO2e. Many of the models in these studies suggest that delay causes a target of 450 ppm CO2e to be much more costly to achieve, or possibly even infeasible.
  • delay from 2010 to 2020 to stabilize CO2 concentration levels at 450 ppm by 2100 raises mitigation cost by 50 to 700 percent.

A summary of the report and a link to the full 32 page document can be found at http://www.whitehouse.gov/blog/2014/07/29/new-report-cost-delaying-action-stem-climate-change

The North Face issues 2014 sustainability report

The North Face, a popular US-based brand and chain of outdoor products with stores and dealers in Canada, has issued its 2014 Corporate Responsibility report.

Among the aspects reported:

  • The North Face Denali jacket, a product the Company describes as ‘iconic’, is made from 100 percent from recycled content. The Company has set a goal to reach 100 percent of its polyester fabric to be made from recycled content, primarily water bottles, by 2016.
  • The Company receives more than 160,000 product units each year at its warranty department and almost half are repairable and returned to consumers. The remainder are donated or downcycled depending on the condition.
  • The Company encourages consumers to drop off unwanted clothing and footwear from any brand in any condition at 27 participating The North Face retail stores. The items are sent to a recycling centre where they are carefully sorted and then repurposed for reuse to extend their life or recycled into raw materials for use in products like insulation, carpet padding, stuffing for toys, and fibers for new clothing.
  • At its California headquarters the Company diverts 86 percent of all waste from landfills. It maintains a recycling centre for hard-to-recycle items and a sustainable café that provides only reusable or compostable dishes and utensils.
  • It  tracks greenhouse gas emissions to monitor progress toward a five-year (2013) goal of a 25-percent reduction in sales-normalized emissions. As of July 2014 the Company achieved a 21-percent reduction. It found its biggest challenge came from retail facilities, which account for 67 percent of total measured emissions and are often leased stores. Without full control over the infrastructure of many of its retail stores, the Company is limited in the changes which can be implemented. To make up this deficit the Company continues to pursue opportunities at its owned facilities and through retail retrofits.
  • The North Face works continuously with suppliers to reduce chemicals, water, energy, and waste in their mills. Savings since 2010 are equivalent to removing more than 100 tanker trucks of chemicals and more than 230 Olympic swimming pools of water.
  • The North Face has created the Responsible Down Standard to help to ensure that its down does not come from animals that have been subject to any unnecessary harm, such as force-feeding or live-plucking, and to provide a traceability system to validate the original source of down used in The North Face products. Certified down will be incorporated into products starting in Fall 2015 with a goal of 100 percent certification by Fall 2017.
  • The North Face has partnered with experts to help its mills reduce their impact by using water and energy more efficiently and by addressing harmful chemicals at the fabric level.
  • The Company conducts annual social, environmental, and ethical audits of its suppliers.

There is no evidence on the Company’s website that all of the sustainability claims have been independently audited or verified, nor does the report conform to Global Reporting Initiative or other recognized sustainability reporting standard. However the initiatives show leadership by a manufacturer and brandowner in a product sector that is likely to appeal to an environmentally concerned category of consumers.

The report is available at http://neverstopexploring.com/2014/07/22/north-face-2014-corporate-responsibility-report/ and at http://www.thenorthface.com/en_US/innovation/sustainability/ where links direct to more details of some aspects of the report.

One UK supermarket powered entirely by food waste

The UK supermarket chain J Sainsbury plc has announced that one of its supermarkets will be powered entirely by electricity generated from anaerobic digestion of food waste from all of the chain’s supermarkets. Sainsbury has about 580 supermarkets and almost as many convenience stores in the UK.

The Company states that the project helps to close the loop on food recycling and helps Sainsbury’s continue to send zero operational waste to landfill.

Like many Canadian supermarkets, Sainsbury marks down products that are approaching the end of their life and offers surplus product to food banks and charities. Some of the remaining products go to processing for animal feed. The residue is collected by the Company’s own trucks and sent to an anaerobic digestion facility in the West Midlands of England. The gas from the digester is used to power a generator which supplies electricity to a Sainsbury store some 1.5km away. Excess power is sold into the national grid.

Sainsbury claims to be the UK’s largest retail user of anaerobic digestion, generating enough energy to power 2,500 homes each year. The plant, run by waste management company Biffa, is said by Biffa to be the UK’s largest operational anaerobic digestion facility dealing with source segregated food waste. The facility is licensed to process 120,000 tonnes of food waste annually.

The Company press release can be found at http://www.j-sainsbury.co.uk/media/latest-stories/2014/0618-running-on-rubbish-supermarket-comes-off-national-grid-to-be-powered-by-food-waste-alone/

Green bond markets are growing fast, according to the Climate Bonds Initiative

The Climate Bonds Initiative, in partnership with global bank HSBC, has just published the 2014 edition of its annual report Bonds and Climate Change: The State of the Market. The CBI claims to be the only organization in the world helping to accelerate the transition to a low-carbon economy by mobilising the largest capital market of all –  the $80 trillion bond market – for climate change solutions. Its work aims to reduce market friction and improve risk differentiation for green investments.

The study finds:

  • The total universe of bonds linked to key climate changes solutions stands at US$502.6bn, compared to last year’s estimate of $346bn.
  • $35.8bn of the universe is made up of labelled green bonds issued by corporations and development banks.
  • $236.6bn (47% of total) meets index filters around size, rating and currencies.
  • Low carbon transport, notably rail, accounts for 71% of the total, followed by clean energy (15%) and climate finance (10%).
  • By category, green bonds have been issued for transport ($358.4bn), energy ($74.7bn), finance ($50.1bn), buildings and industry ($13.5bn), agriculture and forestry ($4.2bn), waste and pollution ($1.4bn), and water ($266m).
  • China remains the largest single issuing country due to the inclusion of China Railway Corp. which is one of the largest builders of new rail infrastructure in the world.
  • Top green bond issuing countries are China ($164bn), UK ($58.5bn), US ($51bn), France ($49bn), Canada ($25bn), and South Korea ($24bn).

CBI claims that the growth in the Green Bonds market is part of an overarching trend towards increasing interest in environmental, social and governance issues across all asset classes.

The 12 page report, containing much more data about green bonds, is available at http://www.climatebonds.net/bonds-climate-change-2014. Watch for more coverage of green investments in an issue of Gallon Environment Letter later this year.

 

California water use restrictions may indicate future trends

In the face of a major drought California has introduced new emergency rules to restrict water use. With drought potentially becoming more common across many parts of North America, including in Canada, and with California frequently being cited as a leader in environmental initiatives, industrial, commercial and institutional water users as well as property developers would be well advised to watch the California initiatives as a guide to water use restrictions that might in future come to other regions.

Most of the California initiatives relate to urban outdoor uses of water: irrigation of landscaping, washing of vehicles, washing of paved surfaces, decorative fountains, etc. Specific measures include:

  • education of water users and employees of water suppliers;
  • encouragement of use of reclaimed or recycled water;
  • acceleration of projects that will conserve potable water by making use of non-potable supplies, such as recycled water, greywater, and stormwater collection;
  • prohibition of use of potable water in fountains and other outdoor water features;
  • banning application of potable water to outdoor landscapes in a manner that causes runoff such that water flows onto adjacent property, non-irrigated areas, private and public walkways, roadways, parking lots, or structures;
  • prohibiting use of a hose that dispenses potable water to wash a motor vehicle, except where the hose is fitted with a shut-off nozzle or device attached to it that causes it to cease dispensing water immediately when not in use;
  • prohibiting application of potable water to driveways and sidewalks;
  • limiting outdoor irrigation of ornamental landscapes or turf with potable water to no more than two days per week;
  • dissemination of information regarding opportunities and incentives to upgrade indoor fixtures and appliances;
  • improved distribution system leak reporting and response programs;
  • encouraging water users to seek out and fix leaks;
  • water loss audits;
  • setting “drought rates” (special water surcharges) to discourage water use;
  • encourage and promote new technologies that reduce water usage.

The State regulation can be found at http://www.waterboards.ca.gov/board_decisions/adopted_orders/resolutions/2014/rs2014_0038_regs.pdf

Many large corporations are taking steps to reduce carbon emissions

A new report from US-based CERES, formerly the Coalition for Environmentally Responsible Economies, points out that the lead in clean and green energy is now being taken more by large corporations than by governments. The report states that:

  • 43 percent, or 215 of the companies in the Fortune 500 have set targets in one of three categories: (1) greenhouse gas (GHG) reduction commitments, (2) energy efficiency, and (3) renewable energy.
  • Nearly half of the largest companies in the U.S. are capturing significant business value by cutting emissions and using clean forms of energy to power their operations.
  • The largest companies in the Fortune 500 – the Fortune 100 – continue to lead: 60 percent of Fortune 100 companies have set clean energy and GHG reduction targets as of 2013.
  • Among the 53 Fortune 100 companies reporting on climate and energy targets to CDP (formerly the Carbon Disclosure Project), they are conservatively saving $1.1 billion annually through their emission reduction and renewable energy initiatives.
  • In 2012 alone, these companies decreased their annual emissions by approximately 58.3 million metric tons of CO2 equivalent – comparable to retiring about 15 coal plants – saving them an average of $19 per metric ton of carbon dioxide equivalent emissions.

The report concludes with recommendations to companies, investors, the electric sector, and policymakers. Among the recommendations to companies:

  • Set time-bound renewable energy, energy efficiency, or greenhouse gas (GHG) emissions reduction commitments.
  • Include specific renewable energy or energy efficiency targets, or at a minimum ensure that both are part of any GHG reduction strategy. Many companies are realizing strong ROIs by achieving these targets.
  • Be fully transparent in reporting their GHG commitments and the role that renewable energy should play in meeting them, using emerging global standards for Scope 2 carbon accounting. To measure progress, companies should publicly disclose the amount of renewable energy they purchase annually compared to their total energy consumption.
  • Identify opportunities to support local, state, and national policies that remove barriers to scale up renewable energy, deploy energy efficiency, and  enable companies to achieve their climate commitments. All companies should be engaged in policy advocacy because it helps increase availability of renewable energy and lower prices, while bringing corporate commitments and public policy positions in line with one another.

Many more interesting facts and much more detail is available in the 24 page report available through a link at http://www.ceres.org/resources/reports/power-forward-2.0-how-american-companies-are-setting-clean-energy-targets-and-capturing-greater-business-value/view (registration required).

Ontario Budget continues to ignore most aspects of the environment

The newly re-elected Ontario government today introduced its 2014 budget. As promised, the budget was essentially identical to the May 1st budget that led to defeat of the government and the recent election. As previously, the budget contains little for the environment except for transportation and infrastructure funding and management.

However, the government recently posted an updated summary of those measures recommended by Don Drummond in his report of the Commission on the Reform of Ontario’s Public Services, tabled in 2012, that it considers it has implemented. This document may be as good an indicator of the Ontario government’s direction on environment and sustainability issues than either the Speech from the Throne or the Budget. Drummond measures which the government claims to have implemented and which are relevant to environment and sustainable development include:

  • Proposing Bill 141, the Infrastructure for Jobs and Prosperity Act, 2014, that, if passed, would require the Province to regularly table a long-term infrastructure plan in the legislature covering a period of at least 10 years.
  • Improving how municipalities plan and prioritize their infrastructure needs through the Municipal Infrastructure Strategy.
  • Seeking efficiencies in the Ontario Power Authority (OPA) and the Independent Electricity System Operator (IESO) by proposing to merge them into a single, more efficient organization that would help eliminate duplication, better meet today’s electricity needs and save ratepayers money.
  • Launching emPOWERme, a new, interactive website to help energy consumers take charge of the power they use by better understanding the province’s electricity system.
  • Committing to work with Matawa-member First Nation communities on long-term environmental monitoring, socioeconomic and community development, regional infrastructure and resource revenue-sharing as part of developing the Ring of Fire region [mining] opportunities.
  • Continuing to implement risk-based approaches to environmental approvals across more program areas to improve environmental outcomes and address business needs by leveraging current technology.
  • Continuing to coordinate and integrate environmental approvals with other governments to reduce duplication.
  • Exploring policy and legislative options that would support the implementation of the polluter-pay principle. This includes policies focused on prevention and minimizing future provincial liabilities resulting from contaminated sites.

The Speech from the Throne, delivered on July 3, contains only the following commitments related to the environment:

  • The new Ministry of the Environment and Climate Change will co-ordinate action across government to limit greenhouse gas emissions and will renew work with communities across Ontario on adaptation to the growing impacts of climate change.
  • Ontario will work with other provinces and territories to develop a Canadian Energy Strategy, which includes co-ordinated efforts to reduce greenhouse gas emissions, and which recognizes the important role of renewable energy and energy conservation.

The 2014 Ontario Speech from the Throne is at http://news.ontario.ca/opo/en/2014/07/building-ontario-up-speech-from-the-throne.html

The 2014 Ontario Budget is at http://www.ontario.ca/government/2014-ontario-budget

The report on Progress on Implementing Commission on the Reform of Ontario’s Public Services’ Recommendations is at http://www.fin.gov.on.ca/en/reformcommission/progress/

Apple continues to report on its environmental leadership

Apple. a company which GallonDaily has previously lauded for putting the statement “We believe climate change is real. And that it’s a real problem” right up front, has just published its Environmental Responsibility Report for fiscal year 2013.

Among the reported achievements during the year:

  • Apple is now powering 145 of its U.S. retail stores and all of its retail stores in Australia with 100 percent renewable energy.
  • Apple’s carbon footprint from energy use dropped by 31 percent from fiscal 2011 to fiscal 2013 — even though overall energy consumption increased by 44 percent during that time.
  • Energy efficiency programs applied to Apple’s corporate offices in the Cupertino area over the past three years saved 28.5 million kWh of electricity and 751,000 therms of natural gas.
  • The commute alternatives program for Apple employees provided more than 1 million trips and helped avoid greenhouse gas emissions equivalent to taking more than 15,000 vehicles off the road.

The new report also highlights some of the challenges the Company faces:

  • Water consumption rose significantly in 2013, in part due to construction and other expansion activities.
  • Carbon emissions from manufacturing partners remain the largest portion of Apple’s carbon footprint, an area Apple is committed to addressing.

Some of the sections in the latest report may provide useful information for other companies implementing or contemplating environmental initiatives. They include:

  • Why we measure our carbon footprint the way we do.
  • How our carbon footprint informs our thinking.
  • An energy-efficient facility is good, and a 100 percent renewable energy facility is better.
  • When we set out to build a 100 percent renewable energy powered data center, we were told it couldn’t be done. But then we did it.
  • Our new home will be green from the ground up.
  • Apple’s travel and commute programs.
  • Energy efficiency is built in.
  • ENERGY STAR standards are just our starting point.
  • Smaller packaging means smarter packing.
  • Keeping recycling local.
  • No product should be hazardous to your health. Or anyone else’s.
  • We design products with safer materials.
  • Testing for toxins begins at home.
  • We’re doing more with less.
  • Designed for durability.
  • Everyone should have water to use and reuse
  • When we buy on Apple’s behalf, we think green.
  • Composting and recycling in our corporate facilities.

A brief summary and a link to the 19 page report are available at http://www.apple.com/ca/environment/our-progress/

 

 

The problem of plastics in the ocean may not be as advertised

More than five years ago some environmental groups started publishing articles about the “Great Pacific Garbage Patch”, supposedly floating islands of mostly plastic waste caught up in the North Pacific Gyre, an area of ocean where the water tends to move in a circular manner. In some reports this floating island was so large that it was ‘visible from space’. It was not too long before scientific observers visited the area and found that there was no such thing as the Great Pacific Garbage Patch. Reports switched to tens of thousands of tonnes of plastic reportedly floating just below the surface of the ocean. Then it was plastic microparticles. Now a team of scientists who have properly studied the problem and published their results in a peer-reviewed journal have found that the problem is not quite as described by the early reports. In short, while there is a problem, the problem is quite a bit less severe than early reports have suggested, possibly sufficiently less that there is time for industry and society to deal with it before it reaches alarming proportions.

The research, published in the peer-reviewed Proceedings of the National Academy of Sciences by an international team led by Dr. Andrés Cózar of the Faculty of Ocean and Environmental Sciences of the University of the University of Cádiz, Spain, found that the global load of plastic on the open ocean surface is probably of the order of tens of thousands of tons, far less than expected from earlier unscientific reports.

Key findings of the research include:

  • there has been no significant increasing trend of surface plastic concentration in fixed ocean regions since the 1980s, despite an increase in production and disposal.
  • this suggests that surface waters are not the final destination for buoyant plastic debris in the ocean and that removal processes also play a part.
  • the plastic load in the North Pacific Ocean could be related to the high human population on the eastern coast of the Asian continent, the most densely populated coast in the world.
  • continental plastic litter enters the ocean largely through storm-water runoff, flowing into watercourses or directly discharged into coastal waters.
  • a conservative first-order estimate of the floating plastic released into the open ocean from the 1970s (106 tons) is 100-fold larger than the estimate by these scientists of the current load of plastic stored in the ocean.
  • examination of the size distribution of plastic debris on the ocean surface shows a peak in abundance of fragments around 2 mm and a pronounced gap below 1 mm.
  • the gap in the plastic size distribution below 1 mm could indicate a fast breaking down of the plastic fragments from millimeter scale to micrometer scale. Recent scanning electron micrographs of the surface of microplastic particles showed indications that oceanic bacterial populations may be contributing to their degradation.

The data do not suggest that the problem does not exist. But they do suggest that the level of plastic in the oceans has not yet reached catastrophic proportions and that there may still be time enough to ensure that plastic waste does not kill all ocean life. Hopefully industry and society will use this less bad news to address the problem enough to ensure that the catastrophe that some have been predicting does not occur.

The article, and an abstract, can be found at http://www.pnas.org/content/early/2014/06/25/1314705111.abstract?sid=bc6d04ed-21f9-4907-9a32-6715abe5ced4

Bycatch waste appears to be a major sustainability challenge in N. American fisheries

A new report from the oceans-oriented non-governmental organization Oceana indicates that about $1 billion of edible fish, or 20% of the total US commercial fishery, are being wasted each year, in part because of the unintended consequences of government regulations.

The problem is that regulations control the species that can be landed at fishing ports. But they do not protect, nor is it realistic for them to control, the species that are caught. So large quantities of fish that cannot be legally landed, or for which there are no markets, are tossed overboard from fishing boats. These fish are either already dead or are so damaged that they will not recover. Some are not edible but an estimated 2 billion pounds of edible fish are wasted in this way. This represents not only a waste of income to the fishing and fish processing industry but also a huge loss of food for the world’s hungry populations.

As the fish are discarded at sea there is little data on the loss of seafood and its environmental impact on fish populations and on the oceans in general. According to Oceana little work is being done to reduce the waste. Oceana reports that, in 2009, the World Bank reported this problem as costing the global economy $50 billion every year, and likely $2 trillion over the last three decades.

The problem can be solved but it requires a new way of approaching fisheries regulation. Oceana recommends:

  • investing in better bycatch data
  • bycatch limits. Oceana states that in several situations, bycatch caps have prompted fishermen to come up with innovative gear modifications and real-time open-source reporting to collectively ensure that limits are not exceeded and they do not suffer the economic losses from premature fishery closures.
  • changing fisheries management approaches to integrate economic tools into existing bycatch regulations, for example by requiring landing and sale of controlled bycatch.

The 10 page report Wasted Cash: The Price of Waste in the U.S. Fishing Industry is available via a link at http://oceana.org/en/news-media/press-center/press-releases/oceana-finds-us-fishermen-could-lose-1-billion-annually-in-wasted-catch