New CSPI report investigates "clean label" foods, offers key recommendations

Slightly more than a third of Americans think “clean-label” products are free from artificial ingredients. About a third think it means organic or natural. And roughly a third of Americans don’t know what clean label means. For retailers, restaurants, and food manufacturers, that creates a challenging landscape – and one with few [1] defined guardrails.

Today, the Center for Science in the Public Interest (CSPI) released a new report, Clean Labels: Public Relations or Public Health?, that assesses efforts by four restaurants – Chipotle Mexican Grill, Noodles & Company, Panera Bread, and Papa John’s – and nine grocers – Ahold Delhaize (Food Lion, Giant Food, Stop and Shop), Aldi, H-E-B, Kroger, Meijer, Supervalu, Target, Wakefern (ShopRite), and Whole Foods  – to deliver what they interpreted a “clean label” product to mean. The report is well worth the read.

EDF agrees with the CSPI report statement that, “[m]ost substances added to food—even ones with long chemical names—are safe… But some are not, and many have been poorly tested. Indeed, the system intended to ensure the safety of ingredients added to food is deeply flawed.”

We also agree with CSPI that, “To the extent that clean label products are healthier than their non-clean label counterparts, because they are made with actual foods instead of cheap chemical imitations, they deserve praise. Still, the absence of artificial ingredients does not make a food healthy, since it could still be loaded with saturated fat, salt, or added sugars and be largely devoid of dietary fiber and nutrients.” For EDF, clean labels also provide no assurance about other unknown and hazardous food additives such as those used in packaging like perchlorate or that enter food during manufacturing and processing like phthalates.

What should make the report of interest to all engaged in the business of food, from those making it to eating it, are the well-substantiated recommendations for addressing food ingredients in clean-label programs. The CSPI report defines and then assesses the suite of best-in-class clean label efforts by supermarkets and restaurants across three major components:  ingredients covered, food and beverage products covered, and transparency. In general, transparency efforts are strongest, coverage across products is weakest, with ingredient reformulation somewhere in the middle.

The report concludes with a trio of target recommendations and action steps, including:

  • Prioritize public health – Clean-label commitments should be accompanied by meaningful improvements to the nutritional quality of the foods and beverages sold.
  • Comprehensive policies – Lists of prohibited ingredients should apply to all products a restaurant makes or sells, including beverages, and supermarkets should expand clean label policies to all of their private-label brands.
  • Transparency – Restaurants should provide complete ingredient and nutrition information for all menu items, both on-site and on their website, and supermarkets should provide this information on their websites.

Given that natural is an artificial, and often erroneous, synonym for healthy, Clean Labels: Public Relations or Public Health? does just what CSPI intended – provides a useful assessment of clean label efforts that give direction and guidance to companies committed to improving the health and safety of the food they make and sell.

For companies seeking to improve their own food offerings, EDF+Business invites you to visit Behind the Label: A Blueprint for Safer Food Additives in the Marketplace. This online resource details best practices for the five pillars of leadership, offers a model policy and case example, as well as tracking corporate efforts in this space.

[1] “Certified organic” is a federally defined and regulated status.

Business won’t back down on clean energy future

Tom Murray, VP Corporate Partnerships, EDFMore than 530 companies and 100 investors signed the Low Carbon USA letter to President-elect Trump and other U.S. and global leaders to support policies to curb climate change, invest in the low carbon economy, and continue U.S. participation in the Paris Agreement.  It’s a powerful message from business leaders connecting the dots between prosperity and a low-carbon economy and confirming their commitment to continue to lead the way.

The private sector call for continued leadership on climate cannot be ignored. 

“All parts of society have a role to play in tackling climate change, but policy and business leadership is crucial,” said Lars Petersson, president of IKEA U.S. “The Paris Agreement was a bold step towards a cleaner, brighter future, and must be protected. IKEA will continue to work together with other businesses and policymakers to build a low-carbon economy, because we know that together, we can build a better future.”

Despite the climate uncertainty represented in President-elect Trump’s cabinet picks and campaign rhetoric, business is moving forward, actively building a clean energy future. In recent months, Google, Microsoft, Smithfield Foods, Walmart and others have continued to prove what’s possible through bold, science-based greenhouse gas reduction targets, investments in clean energy and expanded efforts to drive down emissions in their operations and supply chains. Adding to the mounting evidence that corporate America gets it and that momentum for business leadership is here to stay.

  • Google has pledged to operate on 100% renewable energy in 2017.
  • Microsoft recently announced the largest wind power purchase agreement to date with a deal to buy 237 megawatts of capacity from projects in Wyoming and Kansas.
  • Smithfield Farms, the largest pork producer in the world, will reduce greenhouse gas emissions 25% by 2025.
  • Walmart has committed to removing a gigaton of emissions from its global supply chain by 2030.

US investment in solar is on the riseAnd clean energy investment is on the rise:

  • U.S. investment in clean energy soared from an impressive $10 billion to $56 billion between 2004 and 2015.
  • Microsoft-founder Bill Gates and nearly two dozen other business leaders launched a $1-billion fund that will finance emerging energy innovations.
  • A new report shows investors controlling more than $5 trillion in assets have committed to dropping some or all fossil fuel stocks from their portfolios.

These efforts are focused on accelerating the transition to a clean energy future. This might be surprising given the current political climate, but smart business leaders understand that decisions must be driven by long-term economics, not short-term politics. A thriving economy depends on a thriving environment.

"With tens of billions of dollars of U.S. renewable energy investment in the works this year alone, and far more globally, the question for American political leadership is whether they want to harness this momentum and potential for economic growth," said Jonas Kron, senior vice president at Trillium Asset Management.

“Creating jobs, and establishing the United States as an innovative world leader in creating a clean energy economy is a no brainer for the Trump administration,” said Aspen Skiing Company CEO Mike Kaplan.

The list of signatories to the Low Carbon USA letter has doubled since November, and includes some of the world’s biggest and most innovative companies, including DuPont, General Mills, HP Enterprises, Pacific Gas & Electric, Salesforce.com, Unilever, and more. These business leaders and many others know that accelerating climate policy and innovations is a pathway to creating jobs and strengthening the economy.

Solar jobs in the U.S. on the rise

A growing low carbon economy already has created jobs and driven economic growth across the U.S. In fact, over 2.5 million Americans now work in the clean energy industry, making above average wages. With China investing over $360 billion in renewables, the U.S. simply cannot afford to change course on this powerful opportunity for environmental protection and economic growth while other countries capitalize.

Business is ready to lead the way and accelerate the path towards a low carbon economy. Business has spoken. Will the President-elect and his new administration listen?


Additional reading:

China Is Going All In On Clean Energy As The U.S. Waffles. How Is That Making America Great Again?

With a record $1.4 trillion in sustainability assets, investors bail on fossil fuels


Follow Tom Murray on Twitter, @TPMurray


Food waste, guilt and the millennial mom: how companies can help

edf-business-of-food-blog-graphic_shelton-grp_12-7-16I spend a lot of time these days thinking about food waste.

Why? First, I’m the mother of a toddler who oscillates between being a bottomless pit, easily cleaning her plate, to being a picky eater who only takes a couple of bites before the bulk of her meal ends up in the trash.

Second, I’m married to a chef who, because he’s a smart businessman, runs his kitchen with the precision of a comptroller: wasted food means lost profit, so every scrap of food is utilized wherever possible.

Finally, I interface almost daily with Walmart, the world’s largest grocer. Walmart recently pledged to root out 1 gigaton of greenhouse gas reductions from its global supply chain, and I’m certain that food waste will play an integral part in reaching that goal.

But before you conclude that I’m an outlier—some sort of obsessive, “food waste weirdo”— a recent study shows that I’m not the only one struggling with this issue:

Now we all know that just because one feels guilty about something doesn’t mean one’s behavior will change.  Cost, however, is a frequent driver of behavior, so consider these numbers:

In other words, 2.5-4% of the 2015 US median household income is being thrown away! That’s bad news for our wallets—and our planet (NRDC estimates that food rotting in landfills accounts for 16% of U.S. methane emissions).

So it’s a no-brainer that wasting food serves no one’s interests.  What’s not so clear is: what can be done about it?

A business opportunity… with a coveted consumer

This is where I see a real opportunity for grocers—like Walmart—and the food companies that fill their shelves. For the most part, these companies are talking non-stop these days about how to win over the most coveted customer of all, the “millennial mom”.

Inviting millennial moms to be partners on eliminating food waste could be the perfect strategy. They jenny_helen_expertare young (meaning they have years of brand loyalty ahead of them), cost-conscious and environmentally engaged; saving them money while alleviating their food waste guilt is a clear win-win.

I’m not saying this will be easy; that same study reveals that real barriers exist:

However, while conceding that it’s difficult (if not downright un-wise) to portray millennial moms as a monolithic group, marketing profiles of these women consistently portray them as, a.) hungry for information about products; and b.) willing to take action on issues… but only if roadblocks or impediments have been removed.

So, grocers and food companies, how can you burnish your brand with millennial moms while making a real dent in food waste?

Step number 1: engage and educate

Run marketing campaigns, both in-store and out, that will inform these coveted customers on:

  • Proper handling and storage of their food to minimize spoilage; and
  • How to fully utilize their food purchases. In other words, teach them to think like my husband, the chef, so they can make use of scraps and leftovers.

Step number 2: make it easy

Design and implement initiatives that make for fun, easy adoption:

  • Clarify date labeling so that perfectly good food isn’t perceived as bad. The USDA just requested that companies switch to “best if used by” language to give consumers more accurate guidance.
  • Suggest meals that enable moms to buy just what they need—and use it up. There’s a real business opportunity here: did you know that, as of 4 pm each day, 80% of mom’s don’t know what’s for dinner that night? Suggesting recipes that will be totally consumed will make her life easier!
  • Inspire composting (and discount composters)… their garden will thrive because of you! Or help make curbside composting possible like in Boulder, Seattle and San Francisco.
  • Be creative… people love to compete! Only 13.5% think that their household wastes more than their average neighbor. Help people understand that they may in fact be wasting way more food and money than their friends, family, and neighbors to motivate them to do something about it.

In the meantime, I will carry on, hopeful that while my daughter learns to clean her plate, an array of giant food companies and grocers will take up the mantle of tackling food waste on a massive scale.

How can your company detox in 2017? EDF’s new tools for safer chemicals in products

Green Business Businessman Inspiration Peaceful Concept

Becoming a leader on safer chemicals is a meaningful way to address increasing consumer demand for ingredient transparency and safer products. The good news: taking the first step is easy to do.

In these uncertain times, corporate leadership is more important than ever in maintaining momentum to address our most serious environmental challenges – from climate change to water depletion to exposure to hazardous chemicals. Recently, I participated in the 11th annual BizNGO Conference titled “Measuring Progress to Safer Chemicals.” The event was full of solutions-oriented dialogue among NGOs, investment firms, and leading consumer product companies – in textiles, personal care, health care, electronics, cleaning, and more – about topics from meaningful transparency to measuring the ubiquity of chemicals of concern. Overall, the conference renewed my belief that companies are ready and willing to accelerate the adoption of safer chemicals in the marketplace. For example, now over 60 organizations, including Staples and CVS Health, have signed on to the Chemical Footprint Project, which recognizes companies that have effectively demonstrated public commitment to improved chemicals management. Elsewhere, some companies are publicly showing success at reducing the use of chemicals of concern.

Although leading companies are paving the way, it is clear that we need more companies, especially more retailers, to achieve full marketplace transformation. Companies that are interested – but uncertain of where to start – should explore building a chemicals policy.

A written corporate chemicals policy is the most effective tool in jump-starting and sustaining Institutional Commitment for safer chemicals. It helps a company articulate its chemical management goals and set a course for success. A strong chemicals policy begins with an overarching aspirational vision that conveys the company’s desire to take a leadership stance. The company’s specific objectives for attaining leadership on safer chemicals are the meat of a chemicals policy. At a minimum, these objectives should focus on:

  • Improving Supply Chain Transparency
  • Cultivating Informed Consumers
  • Embedding safer Product Design, and
  • Showing Public Commitment

What are the benefits of writing all of this down? Goal embedment and alignment, employee empowerment, and sparking accountability internally and within the company’s supply chain – to name a few.

But what does all of this really look like on paper? EDF has created templates retailers can use when fleshing out their own chemicals policy. Our templates provide starting text as well as tips and resources for customization.

Consumers are looking to companies to lead the way — publicly and credibly. Use our templates to help you build a chemicals policy that gives you a competitive edge and builds consumer trust.

 

Things You May Have Missed During the Election #2: Deforestation and Walmart’s Gigaton Goal

edf-business-of-food-blog-graphic_shelton-grp_12-7-16Editor's Note—We're proud to make two, new introductions this month: Katie Anderson joins our Supply Chain team as a Project Manager with a focus on deforestation, and "The Business of Food" is born as a new category dedicated to exploring how the growing, processing, distributing, purchasing, consuming and disposing of food impacts our communities, our economy and our planet.

A month out from the election, we know that the global community faces significant uncertainty about what President-elect Trump and his administration will mean for climate outcomes. But with the 24-hour news cycle making it clear just how “transitional” this presidential transition period is, I think it’s worth shining a light on three recent events that I’m going label has hopeful, tragic and confounding:

  1. Hopeful: as part of its 2025 sustainability goals, Walmart announced a target reduction of 1 gigaton of greenhouse gases from its supply chain;
  2. Tragic: Brazil’s National Institute for Space Research (INPE) announced a 29% increase in deforestation over the past year;
  3. Confounding: thinking he was going to have a climate change chat with Ivanka Trump, Al Gore made a trip to Manhattan—and ended up sitting down with the President-elect as well.

Let’s take the second part first and talk about deforestation.  Tropical deforestation contributes about 15% of the world’s greenhouse gas emissions, making forests an incredibly valuable part of the climate conversation.

Katie Anderson Project Manager, Supply Chain

Katie Anderson
Project Manager, Supply Chain

Alongside the climate benefits, forests also provide habitat for 70% of the world’s species, allow for improved water quality and support livelihoods for indigenous communities. So INPE’s announcement is absolutely tragic—especially when you consider that the amount of tropical forest lost in just one year equals the size of the state of Delaware.

So let’s move on to the hopeful part: Walmart’s goal. Just how much, exactly, is 1 gigaton of greenhouse gas? Most often it’s held up as being equal to the annual emissions of Germany (the world’s 4th largest economy). But just so you can appreciate the scale of both Walmart’s audacious ambitions and the problem we’re facing in our rainforests, Walmart’s goal is equivalent to only ¼ the annual GHG emissions caused by global deforestation!

Which means we’ve got a long way to go.

On to the confounding part: kudos to Ivanka Trump for inviting Al Gore for a talk on climate change. Sadly, it seems her dream position of being the “Climate Czar” will be ceremonial at best, because whatever was discussed at their Manhattan meeting was likely rendered moot by her father’s nomination of Scott Pruitt to be head of the Environmental Protection Agency (EPA). I’m guessing we’ll never really know what was said, but if Donald and Ivanka are even half the business geniuses they claim to be, they should have listened to Gore, particularly if he brought up deforestation. Here’s why:

Sustainable sourcing drives business value

Creating deforestation-free supply chains provides value to corporate bottom lines. Effective work on reducing deforestation in supply chains reduces reputational risk, builds trust and transparency with consumers, and drives investor value. Just two examples include:

In other words, customers and shareholders around the world are waking up, and business leaders are responding accordingly. Given that agriculture drives 70% of global deforestation, corporate actors who source our everyday products now realize they have big role to play in finding a solution.

Walmart is a perfect example: the need to expand the sourcing of commodities produced with zero net deforestation was cited as an essential component of meeting the 1 gigaton goal. And Walmart is by no means alone: to date, 366 companies have made public commitments to reduce deforestation in their supply chains—for the simple reason that they’re becoming aware of the major risks of not engaging in deforestation-free sourcing.

Unfortunately, public information on if/how companies are achieving these goals is only available for one-third of these commitments, but it appears that, while they’re a good start, commitments alone not enough.

Given all that, what’s a forward-thinking CEO to do regarding deforestation?

Landscape-scale approaches are critical to hitting targets

An emerging opportunity is in engaging landscapes, or jurisdictions, in reducing deforestation across the entire area. Rather than going farm-by-farm to achieve certifications—which is likely to lead to islands of “green” in a sea of deforestation—a jurisdictional approach allows whole regions to be categorized as reducing deforestation.

This is valuable for many reasons:

  1. the costs of monitoring compliance are shared among governments, corporate actors, and other stakeholders;
  2. it avoids leakage—a problem where one farm may reduce deforestation but will push deforestation into a different farm;
  3. it works across all commodities that drive deforestation rather than solely through certain supply chains;
  4. it protects the rights of landholders and indigenous communities.

Now, more than ever, business needs to lead

President-elect Trump often cites business as “the solution” to what’s ailing our country. In terms of climate change, this is one area where he and I agree.

In these uncertain (read: hopeful, tragic, confounding) times, it is incredibly important for corporations to publicly lead on how they work within their operations and their supply chains to reach climate balance. This means setting bigger goals, digging more deeply into the weeds to understand the impacts of their supply chains, and reaching beyond their walls to find the solutions that are most likely to bring the change we need.

Will Shareholders Get Money’s Worth As Oil Giants Link Executive Pay to Climate Results?

Money talks. That’s why one key element in the battle against climate change must be aligning the financial compensation of executives to tangible corporate efforts to decarbonize.

Better aligning incentives is particularly important in energy intensive industries, where the status quo can encourage decisions on strategy, investment, and operations that jeopardize the planet’s climate, while also generating risk to investors that can, ultimately, undercut a company’s  long-term viability.

In a promising sign, Royal Dutch Shell CEO recently announced that executive bonuses at the oil and gas giant will include greenhouse gas goals. “We have linked executive remuneration in the past to energy intensity and next year we are going to make it even more specific to the CO2 footprint metrics associated with these energy efficiencies” he said. Ten percent of bonus payments to executives, including the CEO and CFO at Shell, will reportedly be linked to “greenhouse gas management”.

Indeed, a broader trend toward heightened sustainability in governance is underway. Analysts at the nonprofit organization CERES report that as of 2014, 24% of examined companies linked executive compensation to sustainability performance, up from 15% two years earlier.

Do These Pay Policies Measure Up?

As companies like Shell translate aspiration into practice, the big questions now are how will executive pay linked to de-carbonization be operationalized, and will it be enough to make the difference demanded by the dire science of climate change. There are two key issues in particular that boards, shareholders, and others can ask as GHG bonus measures are developed and assessed:

1. Are bonus payments tied to explicit, ambitious and well-chosen metrics?

The mere act of including greenhouse gas management in compensation is not sufficient. CERES found that of companies linking executive pay to sustainability, few used sustainability performance targets that go beyond goals driven by compliance with laws and regulations. In the absence of comprehensive climate policy – for example market-based signals that put a price on carbon pollution – operators like Shell must go above and beyond compliance metrics for their bonuses to be meaningful. Mere compliance should be expected as a matter of course; winning a GHG bonus must require another level of executive leadership and results.

There are a host of metrics that oil and gas operators can consider as they link compensation to GHG management. Those metrics may differ for large vertically integrated oil and gas majors like Shell, versus smaller companies that operate in just one or two segments of the oil and gas value chain. One common element is incentivizing strong methane management.

Methane emissions are a widespread issue across the oil and gas supply chain. Leaks and other intentional releases waste valuable product, speed climate change, and cast serious doubt on the ability of natural gas to play a constructive role in the transition to a cleaner energy economy. However, as Environmental Defense Fund found in Rising Risk: Improving Methane Disclosure in the Oil and Gas Industry, as of early 2016, none of the leading 65 oil and gas operators disclosed a quantitative target to reduce methane emissions.

As Principles for Responsible Investment noted in its recent Investor's Guide to Methane developed with EDF, investors should expect operators to put governance to work to get the incentives right for enhanced methane management. After all, what gets measured, gets managed, and creating incentives to address invisible gas leaks can make a visible difference.

The ultimate methane metric would operationalize the same kind of “zero tolerance” approach to methane leaks that companies take to preventing fatalities. In the near term, we look for incentives tied to comprehensive, direct methane measurement; leading practices including minimizing venting and conducting regular leak detection and repair; and achievement of verifiable emission reductions.

Beyond methane, GHG metrics may encompass reducing CO2 intensity from fossil fuel operations, but also expanding into renewable energy, as Total, Statoil, and others have signaled. Taken together, an appropriate mix of GHG metrics will send an unmistakable signal to executives that a holistic approach to de-carbonization is the new order of the day.

2. Is the bonus a token or a change agent?

Even well-defined de-carbonization metrics can prove insufficient if the incentive is not strong enough, particularly compared with the full suite of executive motivators. In Shell’s case, while its commitment to tie 10% of executive pay to greenhouse gas management puts it 10% ahead of most of its peers, the question remains: is the incentive adequate enough to change decision making with the speed and seriousness required to achieve the energy transformation we need.

We expect institutional investors and others to look carefully not only at the specifics of the 10% bonus on GHG management, but the 90% on other factors. For energy operators taking the positive step to link pay to climate performance, it will be important to guard against also using contradictory factors that could send mixed messages, such as rewarding executives for expanding carbon reserves, a practice that 13 of 30 major U.S. fossil-fuel corporations practiced, according to a recent report by the Institute for Policy Studies.

We applaud Shell’s intent to link climate performance to pay and look forward to examining the details. In the meantime, as pressure mounts for more oil and gas operators to follow suit, varying operator reactions will tell investors a lot about which companies are poised to adapt best to a lower-carbon energy future.

Three Ways Trump’s EPA Pick is Bad for Business

President-Elect Trump’s selection of Oklahoma attorney general Scott Pruitt as the next head of the Environmental Protection Agency has drawn swift criticism from environmental and health advocates. Passing the nation’s environmental agency to one of its staunchest opponents risks upending the clean air and clean water that Americans of both parties demand. And looking deeper, Pruitt’s track record suggests he will harm the American economy while increasing pollution.

Here are three ways the Pruitt choice isn’t just bad for the environment, it’s bad for business:

1. Blocking federal methane rules means more wasted American energy
Protecting common sense standards to reduce oil and gas methane emissions is a winning opportunity for American business, but that did not stop Pruitt from suing EPA on its proposed methane rules earlier this year.

Methane is a natural resource, and cutting methane emissions means cutting economic waste. A recent study from ICF International found that drilling on federal and tribal lands – mostly in the rural West -leaked, vented, and flared natural gas worth about $330 million in 2013. Across the U.S., the market value of wasted natural gas is estimated at $2 billion.

Furthermore, there are good jobs at stake keeping methane and other air pollutants in the pipes and out of the air communities breathe. A report by Datu Research identified over 75 firms with over 500 locations across the country putting people to work in the methane mitigation industry. These include well-paying jobs in manufacturing, plus leak detection service jobs that offer technical training and are inherently offshore-proof. With nearly 60% of methane mitigation firms being small businesses, including in states like Colorado, Ohio, and Pennsylvania, national efforts to support methane reductions are a job creator at just the right time.

And, many investors recognize that achieving methane reductions is vital if natural gas is to play a constructive role in the transition to a low carbon energy economy. In fact, investors representing over $3.6 trillion in assets under management praised the North American agreement to reduce oil and gas methane emissions 45%. Public pension fund CEO Jack Ehnes wrote that as a large investor with a financial stake in the long term performance of the natural gas industry, CalSTRS sees that “methane emissions — which literally leak away the potential climate benefits of natural gas over other fossil fuels — must be actively managed.”

Most recently, seven in ten Colorado oil and gas operators interviewed about that state’s experience implementing methane rules reported that the benefits of compliance outweighed the costs.

In spite of the jobs and other business benefits of regulating methane emissions, as attorney general of Oklahoma, Pruitt took a page – literally – from a large oil company and sued EPA on its proposed methane rule. This approach may have appeased a big oil backer, but is short-sighted for the industry’s own long-term good, and hurts the American workers whose paycheck comes from preventing and fixing natural gas leaks.

2. Undermining the Clean Power Plan will slow economic growth in clean energy
The Clean Power Plan helps continue the trend of generating even more jobs in fast-growing segments of the American economy, including wind and solar energy, and energy efficiency. Third party estimates suggest that the plan will create 74,000 to 273,000 new jobs in those and related industries, on top of the hundreds of thousands of already existing clean energy jobs. Unfortunately, Pruitt joined a lawsuit against the plan, parroting scare tactic claims that the rule would increase electricity prices.

In reality, the Clean Power plan capitalizes on economic progress many states are already making, such as the rise of solar energy in North Carolina and California. With costs plummeting in solar energy, renewable energy last year accounted for the majority of new installed power capacity.

And because wind and solar are generally more labor-intensive than older energy forms, we can expect a windfall of well-paying, sustainable American jobs in tomorrow’s clean energy economy if we stay the course.

These positive trends are part of why American businesses like Google have committed to sourcing 100% renewable energy. Google and other leading technology companies defended the Clean Power Plan in court because they see that market-oriented government support for clean energy will help their businesses gain access to cheap, clean, stably priced energy for years to come.

In attacking the Clean Power Plan, Pruitt raised the specter of shuttering coal fired plants. However, as a fossil-fuel backer, he should know what experts believe and even natural gas industry insiders privately admit: it is cheap natural gas, not environmental rules, that is mainly responsible for driving coal plants out of business. As CEO of Appalachian Power, a West Virginia, Virginia, and Tennessee utility said, “You just can’t go with new coal [plants] at this point in time. It is just not economically feasible to do so.”

3. Denying climate is denying a great threat – and opportunity – for business
The days of seeing global climate change as only an environmental issue are over. But while many business leaders acknowledge climate change as the fundamental threat that it is – to infrastructure, supply chains, and national security to name a few – Pruitt says the “debate” on climate change is “far from over”.

The doubt seeded by climate denialism may be fake, but it can inflict business consequences that are real.
In a globalized economy, American businesses benefit from our standing in the world and the goodwill we have achieved. With the world marching toward a cleaner energy future, propelled by the climate agreement of nearly 200 nations last year in Paris, American businesses have an interest in standing with the international community and competing on a level playing field.

We have an opportunity to win the next frontier of entrepreneurship and innovation in the clean energy products and ideas demanded the world over. Yet, Pruitt would likely become the only environmental chief in the world who doubts climate change. This anomaly would isolate and embarrass America. In short, the opposite of what businesses need to hear as America competes with China and others to seize the mantle of leadership on a global economic opportunity.

There are many capable environmental leaders from across the political and philosophical spectrum. America needs leaders to chart a path of environmental stewardship and economic prosperity. Mr. Pruitt’s record suggests he would do neither.

Methane Detectors Challenge: An Unlikely Partnership

The 2016 election was one of the most divisive in recent history. I cannot remember a more polarizing time. However, today, I believe, more strongly than ever, that many Americans across the political spectrum have a hunger for something better: for turning down the volume, having rational conversations and finding common ground that unites us.

In the energy sector and environmental communities, this common ground means achieving solutions that benefit the environment and help businesses thrive, not pitting one against the other.

Three years ago, Environmental Defense Fund launched the Methane Detectors Challenge, an unlikely partnership between oil and gas companies and U.S.-based technology developers. This partnership aims to reduce methane emissions by catalyzing technology solutions that continuously detect these emissions. This is our story.

 A Shared Problem, A Shared Solution

25-percent

About 25 percent of today’s warming is driven by emissions of methane, a potent greenhouse gas. Methane emissions from the oil and gas industry speed global climate change, waste a valuable energy resource (methane is the key component of natural gas), and often slip into the atmosphere with other pollutants, harming air quality.

In other words, methane emissions are a problem and detecting leaks quickly is a needed solution.

However, in 2013, we learned that no oil and gas operators were conducting 24/7 monitoring of methane emissions. None. Some companies were not using technology to conduct leak detection and repair activities, while others conducted manual leak surveys with special cameras once or twice a year – far better than nothing, but a long way from continuous detection made possible in the digital age.

When EDF learned about this lack of continuous monitoring, we could have launched a negative ad blitz. Started a petition. Designated a villain.

We didn’t.

Instead, where some might see failure, we saw opportunity and a reason to partner. We decided to take a risk, try something bold. We decided to partner with leading companies in the oil and gas industry, technical experts, and others, to source innovative technology solutions from the marketplace and solve the methane leak problem.

We called it the Methane Detectors Challenge. Our aim was to catalyze the development and adoption of new, cost effective, continuous detection systems.

I remember sharing our vision with Mark Boling, President – V+ Development Solutions at Southwestern Energy, over breakfast. Before the food had even arrived, Mark committed to Southwestern’s participation. We had our first partner. And this was just the beginning.

A Partnership Blooms

In the months that followed, we recruited partner after partner: Apache, Anadarko, BG Group, Hess, Noble Energy, Shell, Southwestern and Statoil. We found experts willing to lend their knowledge, from places like the Environmental Protection Agency, the Department of Energy, and the University of Houston.

We launched a series of gatherings that brought stakeholders together in Houston to define the problem and develop a shared plan of action. We got to know one another and to develop a common empathy for the challenges we all shared.

At the end of our first Steering Committee meeting, one of our corporate partners came up to me and said, “Great meeting today, but one thing you should change. Don’t call it the EDF Methane Detectors Challenge. Just call it the Methane Detectors Challenge. We’re all in this together.”

In March 2014, our jointly developed request for technology proposals was out in the world, and we soon reviewed twenty proposals from four different continents. The surge of market interest was incredible, and the best of the proposals inspired excitement among all partners.

By the end of 2015, in partnership with the independent non-profit Southwest Research Institute, we had conducted rigorous indoor and outdoor controlled testing of nearly a half dozen technologies. Two technologies performed excellently, catching leaks of various sizes in various wind conditions. Next step? Industry pilots.

When Challenge Strikes

As the Methane Detectors Challenge shifted from third-party evaluation to piloting, there were increased expectations of our oil and gas partners. They had already helped inform the project’s direction and shared invaluable technical input about their technology needs. The next step was a higher bar – purchasing one or more units and committing organizational resources for pilot testing.

And then a challenge struck.

In 2015, the oil and gas commodity markets fell off a cliff. Oil nose-dived from over $100 a barrel to as low as $29 a barrel. Natural gas prices crashed. Before we knew it, our partners were making layoffs, in some cases as large as 40%, and cutting capital expenditure by as much as 80% for the year ahead.

As the markets sunk and companies down-sized, our effort became much more challenging, but the foundation of trust and the value of our common mission remained unchanged. And so we persevered.

Over the course of 2016, dialogues continued between the leading entrepreneurs and a number of our industry partners. The unglamorous, but necessary issues were resolved: contracts, prices, disclosure and data sharing agreements.

And then one day, I came into my office to find a note from my colleague. “We have a deal”, it said. A large energy producer and Methane Detectors Challenge partner, Statoil, agreed to purchase a methane detection system and host a pilot with Colorado based start-up Quanta3.

Weeks later, we got more good news. Following a successful pilot test, Pacific Gas & Electric (PG&E) (an enthusiastic recent addition to the Methane Detectors Challenge), agreed to send a device from Acutect, the other leading entrepreneur, to an operating facility in California for real-world testing.

In praise of an unexpected partnership

In the coming months, we will learn much more about how the technologies developed for the Methane Detectors Challenge perform in the trials with Statoil, PG&E, and likely others. It’s too soon to know whether these technologies will provide the needed breakthrough for continuous methane detection, whether they will require additional development, or whether other advances from the marketplace will propel methane management forward.

But it’s not too soon to appreciate this unexpected partnership.

pge-methane-sensor-3828-300dpiWe have demonstrated that there is a vibrant global marketplace of entrepreneurs eager for the chance to accelerate a clean energy future and willing to take risks along the way. And, we have shown that diverse groups can come together over a shared vision.

Most of all, I hope we have proven that even in this era of divisiveness, partnerships are not just possible, they are powerful. Our door is always open to new partners.

 

EDF is grateful to our partners and hope the Methane Detectors Challenge is the beginning of something even bigger.


Follow @RatnerBen on Twitter


 

Smithfield Foods Joins the Growing List of Sustainability Leaders. Who's Next?

The largest pork company in the world, Smithfield Foods, just committed to reduce absolute greenhouse gas emissions by 25% by 2025 across its upstream U.S. supply chain, from feed grain to packaged bacon. This goal is the first of its kind in the livestock sector; and is thus big news.

It is also a long time in the making. Over the past 20 years, EDF and Smithfield have not always seen eye to eye.Tom Murray, VP Corporate Partnerships, EDF Although we have opposed Smithfield on some critical issues, we have collaborated  on others. Most recently, EDF and Smithfield worked together to help farmers who grow grain for hog feed use fertilizer efficiently and improve soil health. The business and environmental benefits that Smithfield discovered through that effort led the company to want to do more, resulting in today’s industry-leading commitment.

As part of the commitment, one area where Smithfield will work to reduce its greenhouse gas footprint—and one that EDF applauds—is in manure management.

In the past, EDF has pressed Smithfield to improve its manure management, particularly the use of uncovered hog manure lagoons. Now, within the first five years of its commitment, Smithfield will install manure management practices, including covered lagoons, on at least 30 percent of company-owned farms. These changes will eliminate harmful methane emissions and reduce ammonia nitrogen, which contributes to human respiratory illness and impairs water quality. Furthermore, Smithfield will work with its contract growers to expand the use of those practices over the full term of its commitment.

It’s inspiring to see Smithfield’s overall climate commitment and willingness to change its position on an issue like manure management. It shows how NGO/corporate collaborations can work over the long term.

With its climate commitment, Smithfield has set the bar for other livestock companies. We encourage others to follow Smithfield’s lead and set their own public targets based in strong science to reduce the climate and environmental impacts of animal agriculture and food production.

Sustainability in food supply chains: a challenge worth tackling

The climate crisis can’t be solved without addressing emissions from livestock and agriculture:

Food and agriculture companies, however, face major barriers in setting and achieving supply chain sustainability commitments. As a general rule, the majority of their environmental impacts come from the many disparate farms that grow the grains, produce, and animals that end up in our food. For companies that often do not even know the locations of those farms, it is a major challenge to influence those farmers to become more sustainable.

At the same time, food and agriculture companies see that consumers are demanding increased transparency and responsibility for all of their impacts, particularly those on human health, the environment, and animal welfare. The challenge is to figure out how to make needed improvements without substantial price increases at the grocery checkout.

The business case for sustainability – and collaboration

Companies like Smithfield are watching consumer trends and placing a bet that sustainability will be good for their bottom line. They can’t reap these benefits, though, unless they focus on providing value to the farmers in their supply chains. This value can come in many forms – some companies are offering premiums for sustainably grown grain, while others are helping farmers access programs and technologies that reduce the costs of farming.

As a vertically integrated company that owns grain elevators, feed mills, hog farms, and pork processing plants, Smithfield has a unique view into its own supply chain. But many don’t know that Smithfield purchases half of its hogs on the open market, which means the company only has clear visibility through half of its supply chain for pork. In setting a goal for its entire upstream supply chain, Smithfield is committing to work with others in the agriculture industry to assist a broad range of hog and grain farmers adopt more sustainable practices.

Smithfield’s collaboration with EDF demonstrated that the company could improve sustainability in feed grain production, the most remote link of its supply chain, in a way that benefits its business.

This success created the opening to go further, developing Smithfield’s new greenhouse gas target and putting the company in a leadership position in its industry. While Smithfield is the first livestock company to set a major greenhouse gas reduction goal, a sustainable food supply depends on it not being the last.

Who’s next?

The Value of Pursuing a Rational Middle in Polarized Times

rational-middleAt Energy Dialogues’ North American Gas Forum last month, I had the opportunity to participate on a panel moderated by Gregory Kallenberg of the Rational Middle. While the panel pre-dated the presidential election, the topic of constructive engagement through rational discourse is now more important than ever.

We explored how environmental groups, industry, and other stakeholders need to come together to rationally discuss and collaboratively act on the challenges of meeting rising energy demand while addressing real and growing environmental risks.

The still principally fossil-based energy system, which includes natural gas, is not the only cause of climate change, but it is the largest. And so a range of stakeholders, from protesters holding signs, to investors with a long term interest in the future of natural gas, to industry consumers, are looking with increasing criticism at fossil fuels. That was true before the election, and it’s true today. They’re asking: How can we reconcile the environment we want to protect for the future with the traditional energy and feedstock resources we are using now?

Unfortunately, industry, when pressed with concerns and asked to act, has often come up short. For example, with precious few exceptions, oil and natural gas companies have declined to set quantitative methane reduction targets – of their own choosing, and for their own product. And they have declined to join their counterparts’ support for a 2 degree limit on temperature rise. Too often, industry has failed to engage with the real concerns of their customers and communities.

But there’s a better way.

As Sarah Sandberg, from the Colorado Oil & Gas Association, said on the panel, “You’re either at the table or on the menu.” As panelist Michael Crothers from Shell observed, industry must engage directly and responsively with the legitimate climate concerns of the general public. And they’re right.

At Environmental Defense Fund, we work to create opportunities for diverse stakeholders to come to the table and have the conversations that feed the actions – whether establishing public policy, catalyzing technology innovation, or making best practice standard practice – to address environmental challenges and protect our future.

There have been bright spots of industry leadership, like energy companies joining the table in Colorado to help craft the first methane regulations, or Shell Canada supporting Alberta’s new climate strategy, including a methane goal backed by regulations. Unfortunately, such constructive engagements have been the exception to the rule. All too often, industry’s response to environmental concerns and opportunities has amounted to “Just Say No”.

A better response? “Just Say How.” For example:

  • How will operators demonstrate that they hear and are addressing in practical terms, the air and groundwater pollution concerns of the 15 million Americans who live within a mile of a well?
  • How will industry leaders acknowledge and finally engage on public policy to reduce their contribution to climate change?
  • How will they make unnecessary methane emissions a thing of the past, by finding and fixing leaks?
  • How will the companies that do step up and lead on these issues maximize the competitive advantage of being cleaner companies in a world that demands it?

Let’s hope industry can take the real issues head on and start showing how we can make positive changes by working together. Pressure on industry is not going away, and rational engagement can help cut a productive path through polarization.