Government Accountability Office Attacks EPA’s Toxic Substances Program

Mon, 20 May 2013 15:24:39 -0400

On April 29, 2013, the U.S. Government Accountability Office (GAO) released a report on the U.S. Environmental Protection Agency (EPA) titled “Toxic Substances: EPA has Increased Efforts to Assess and Control Chemicals but Could Strengthen Its Approach.”

The GAO has long faulted the EPA's chemicals management program. In 2005, GAO reported that the EPA failed to use its Toxic Substances Control Act (TSCA) authority to obtain information submitted by U.S. companies to foreign governments, and recommended that the EPA promulgate a rule requiring that companies provide the agency with copies of any health and safety studies and other information concerning the environmental and health effects of chemicals submitted to foreign governments. The EPA acted on some of the GAO's recommendations, but hasn't fully implemented them. GAO, for this and other reasons, in 2009, added EPA's processes for assessing and controlling toxic chemicals to its list of programs at high risk of waste, fraud, abuse and mismanagement. The GAO updated this list in February 2013 and the EPA still is considered high-risk.

For more about the GAO’s findings and recommendations, read the full story on ChemicalProcessing.com.

Dairy Supply Chain Receives Guidance for Sustainability Reporting

Mon, 20 May 2013 13:04:38 -0400

The Innovation Center for U.S. Dairy — established under the leadership of America’s dairy producers — has announced two new resources to advance the industry’s ability to track, improve and communicate sustainability performance and progress across the supply chain. The resources were developed under the leadership of the U.S. Dairy Sustainability Council as part of the dairy industry’s ongoing effort to provide consumers with nutritious, responsibly produced dairy foods and beverages.

The resources build on the dairy industry’s commitment to transparent and credible sustainability reporting and include:

The draft “Stewardship and Sustainability Guide for U.S. Dairy: A voluntary framework for tracking and communicating progress,” which has undergone a thorough review process by representatives from across the dairy industry and is now available for a 60-day open stakeholder consultation period.
The 2012 U.S. Dairy Sustainability Report, the industry’s third annual report dedicated to reporting progress toward its sustainability goals.

Both resources are available online.

“Our announcement today showcases another step taken by the dairy industry toward sustainability leadership,” said Barbara O’Brien, president of the Innovation Center for U.S. Dairy. “These tools will provide clear, science-based information to the growing number of consumers who want to understand the environmental impact of the products they buy.”

The Stewardship and Sustainability Guide for U.S. Dairy identifies the most important indicators for assessing dairy sustainability and communicating results. The indicators are based on scientific life cycle assessment studies commissioned by the Innovation Center, and the practical experience of industry members and other experts from nongovernmental, academic and government organizations.

The Guide has been through an extensive and collaborative industry-wide process of testing, piloting and refining content and incorporates initial input from dairy producers, cooperatives and dairy processors.

“This Guide allows dairy farmers, like my family, to voluntarily self-assess our environmental footprint,” said Brian Medeiros, co-owner of Medeiros & Son Dairy and pilot tester of the Stewardship and Sustainability Guide. “For [our dairy], [http://dairygood.org/technology-tools-help-change-the-face-of-dairy-farming/] we see exceptional value in using the Guide in conjunction with tools like Farm Smart, to help pinpoint opportunities for improvement that make good business sense and help us continue to be good stewards of our natural resources.”

A 60-day stakeholder consultation period to obtain feedback that will help ensure the Guide is meaningful, useful and relevant begins on May 15, 2013, and runs through July 14, 2013. Stakeholders are invited to review it online. “The Guide provides dairy operations with tools to continuously improve and communicate results. By establishing common measurements and language, the Guide gives retailers and manufacturers the consistent information they need to track their sustainable sourcing and supply chain management goals,” said Kelly Goodejohn, director, ethical sourcing, Starbucks.

Third Annual Sustainability Report Highlights Progress

Funding from government and nongovernmental organizations has increased by nearly 300 percent from 2008 to 2012, supplementing the industry’s own investments in sustainability projects. This progress is published in the 2012 U.S. Dairy Sustainability Report, a comprehensive resource describing the U.S. Dairy Sustainability Commitment and leadership of the dairy industry and its partners. The report covers challenges and opportunities facing the dairy industry in the 21st century, outlines environmental priorities and highlights the cow’s contribution to a sustainable food system. Using statistics, infographics and stories, the report provides a snapshot of the dairy industry supply chain from farm to table.

Highlights of the 2012 industry-wide efforts featured in the Sustainability Report include:

Completion of four years of research and new tools to help the industry measure the environmental, social and economic sustainability from farm to table.
Sustainability strategies in action across the dairy supply chain.
The second annual U.S. Dairy Sustainability Awards.

The report also provides updates on the 2008 dairy industry commitment to a Sustainability Roadmap with the goal to reduce greenhouse gas emissions of fluid milk by 25 percent and build business value by at least $238 million by 2020.

More information about the U.S. Dairy Sustainability Commitment, the reduction goal or the projects and tools are currently available USDairy.com/Sustainability

Delta Institute Identifies 6 Points of Failure in Industrial Energy Audits

Mon, 20 May 2013 12:07:39 -0400

With grant money “burning a hole in their pockets,” reports Automation World, advisors at the Delta Institute recently conducted free industrial energy audits for 39 manufacturers in the Chicago area, helping them – for those that would accept the help – to build more energy-efficiency operations. Combined with a decade’s worth of analytical data from the International Engineering Consortium (IEC), Delta has gained useful insight into what energy programs manufacturers are willing to implement, how effective they are, and their economic ramifications.

Delta designs programs that are both good for the environment and good for the economy, explained Tom Cushing, senior advisor, who spoke May 15 at The Automation Conference (TAC) in Chicago. “Energy efficiency is the most natural starting place,” he added.

The team conducted its audits in 2011-12, providing reports to give the manufacturers something to measure and manage, then following up to find out what they did and didn’t implement, the reasons for those decisions, and the economic ramifications.

Delta Institute identifies six typical failure points of industrial energy audits, and its recommendations to overcome them.

Read the full article on automationworld.com.

Infographic: Improve Your Safety Culture with The DuPont Bradley Curve

Mon, 20 May 2013 10:00:00 -0400

Experts agree that improved safety leads to increased profitability. What they disagree on is where to start? The Bradley Curve was created in 1995 by DuPont to help clients better understand and benchmark their journey toward word-class safety performance. Illustrated as an infographic below, the Bradley Curve goes through the process of creating a successful safety culture and how to achive buy in from the plant floor all the way to upper management.

DuPont Bradley Curve Infographic

Building an Energy Culture Begins in Elementary School

Fri, 17 May 2013 15:38:43 -0400

Effective industrial energy management programs highlight the importance of a pervasive energy culture. If this exists, all decisions, both great and small, will take into account their impact on energy use and its consequences. Some organizations do achieve something approaching a pervasive energy culture and achieve unusually competitive energy productivity along with a reduced environmental footprint. With the growing list of risks, opportunities, and uncertainties around energy for the coming years, the impact of poorly-thought-through decisions when it comes to energy could be commercially devastating for some businesses. With the need for a pervasive energy culture never higher, it seemed a good time to take a look at some of the challenges and solutions.

Let’s begin with the employees’ backgrounds before they enter the company…

Read the full article on PlantServices.com

Professional Energy Managers Are Critical to Implementation

Fri, 17 May 2013 14:56:06 -0400

Champions within industrial facilities may be the largest piece missing from the energy policy and program landscape. Some energy program administrators are sponsoring the placement of dedicated energy managers at industrial facilities to overcome the obstacles to energy optimization. These pilot efforts seek to accelerate the pace and volume of industrial energy efficiency projects.

The placement of empowered, professional energy managers is an important contributor to the implementation of industrial energy management standards, policies and programs. ACEEE recently released a report, Onsite Energy Manager Pilot Programs: A Survey of Practices and Lessons Learned, that profiles some of the recent programs and identifies the elements that lead to success...

Read the ACEEE blog post by Christopher H. Russell: Creating Value through Energy Management.

Read the report: Onsite Energy Manager Pilot Programs: A Survey of Practices and Lessons Learned.

Is Natural Gas Really a Bridge to a Low-Carbon Future?

Fri, 17 May 2013 12:45:02 -0400

Natural gas is frequently cited as the ideal fossil fuel bridge to a low-carbon future energy system. For a long time this looked environmentally attractive, although expensive given the prevailing view that the United States would be a major importer of gas. In the past few years, shale gas has changed all that.

Plentiful supplies hold out the promise of decades of low-cost natural gas for America, along with visions of a painless pathway to a vastly lower carbon footprint. A picture potentially as rosy as this probably deserves to be looked at in slightly more detail.

First, it is useful to remember that “low-carbon” is shorthand for reduced total greenhouse gases, usually measured in the equivalent of carbon dioxide. When natural gas is burned, it produces CO2; when the same amount leaks as methane, its greenhouse gas effect is more than 70 times the CO2 equivalent measured over 20 years and still 25 times over 100 years. Therefore, any discussion about natural gas has to evaluate not only the combustion impacts, but the leakage impacts.

Read the full article on PlantServices.com.

Going Green in Manufacturing by Improving Visibility and Efficiency across Operations

Fri, 17 May 2013 11:46:18 -0400

Nearly every leading manufacturer is pushing for greener, more sustainable operations. The benefits are well documented, from greater brand equity for being a socially conscious company to reducing waste for lower costs and increased profitability. As we look at what achievements have been accomplished so far, it is helpful to envision a “maturity” curve as a way to take a more holistic perspective to where we have come and where we are going. While the roots of environmentalism in America can be traced back to Henry David Thoreau, who in his book Maine Woods called for the conservation of and respect for nature and the federal preservation of virgin forests, it really wasn’t until 2001 when corporate America really became sufficiently invested to take this social trend into the mainstream.

Over the past decade, considerable progress has been made by companies, including tracking carbon footprints, establishing corporate goals to reduce waste and building the focus necessary to ensure enterprise-wide attention and awareness. Based on some of the goals publicly stated by Fortune 500 companies, the level of “green” at these organizations can be graphed as a maturity curve that represents the impact these activities have had on making the Earth a greener place (see figure).

Apriso’s forecasted maturity curve of green impact by Fortune 500 manufacturers shows the effect of the companies’ publicly stated lofty goals.

Note the forecasted spike, which is based on the lofty goals that are now being publicly stated by some of the world’s largest manufacturers. For example, Procter and Gamble states a 2020 goal is to reduce manufacturing waste sent to landfills to less than 0.5% of input materials. They also state a goal of reducing truck transportation by 20% per unit of production within the same period of time. In order to achieve these aggressive targets, greater collaboration, visibility and effort will be needed to reevaluate how manufacturing can be performed more efficiently to reduce waste on a larger scale in order to accomplish these hefty objectives.

The Importance of Automation

These waste-reduction and process-improvement activities require an elevated commitment to newer, more modern manufacturing technologies and processes coupled with an ability to better collect intelligence and manage performance across the entire spectrum of manufacturing operations. In other words, by placing a stronger focus on business intelligence, operational efficiency and performance improvement, the end result is less waste, which is what being sustainable is all about. Companies are now recognizing this tight inter-dependence that now exists between operational efficiency across business operations and being sustainable or green.

According to a recent survey conducted by MESA and Cambashi Research, improving the speed of performance management is a key factor to improving operational efficiency. Speed can be accelerated by increasing the use of automation in five key areas:

Automated data collection.
Analytical processes that turn data into useful performance metrics.
Dashboard software to display results to employees.
Fully automated information flows, from gauging performance to improving it.
Automating processes to minimize or eliminate human error.

While it might be painfully obvious that waste can be reduced with automation, actually implementing this concept is often easier said than done. The first step is to gain better visibility and intelligence from your operations, which will result in greater insights as to what is even possible. Opportunities might exist to reduce inventory, increase velocity, enhance customer satisfaction or improve return on investment.

Combining an advanced manufacturing system with the collection of operational intelligence is an excellent way to gain improved visibility and knowledge. When operating successfully in a “real world” environment, things often go wrong, resulting in wasted resources and a higher carbon footprint. Operations must often adapt in real time, oscillating away from the original planned activities. Product recalls, part defects or simply mislabeled materials and finished goods can lead to increased warranty costs, regulatory noncompliance issues, fines or a significant loss of brand equity.

Every time an operational change occurs is a potential situation that can lead to waste. When operations are going along the “happy path” there are no issues. Existing continuous process improvement and other Lean initiatives have typically already taken care of the low hanging fruit, further waste reduction is difficult if not impossible to identify. In order to take the next step and improve efficiency within a highly dynamic operations environment where change is frequent, it increasingly becomes necessary to implement more advanced systems capable of delivering the necessary visibility to effectively manage or prevent further waste during these types of unexpected events.

Valeo: A Case Study in how to Drive Greater Operational Performance

A manufacturer that is on track to increase its sustainability performance is Valeo, an automotive supplier operating at nearly 100 sites across the globe. This manufacturer has implemented an Apriso solution to help it track, manage and continuously improve its operations, with an objective to best coordinate material flows and implement best practices across each of their locations.

According to Valeo, “These standard flows enable us to reduce the number of incidents which affect our customers. It is important that all sites across the world use these best practices.”

Valeo operates according to Lean manufacturing best practices, on a “just-in-time” basis. As new orders are received, they are “pulled” through production while being electronically tracked with bar codes to monitor status and location. Apriso’s FlexNet oversees the receipt of raw materials, so Valeo knows the origin of each shipment by supplier, letting it recognize and track materials all the way through to dispatch. Should a product recall be issued or a quality issue be identified from one of their suppliers, it can be quickly contained to reduce waste, resulting in greater sustainability during the production process.

According to Valeo, there are several advantages in using their Apriso solution, including the “user friendliness of the screens, which has allowed operators to pick it up very quickly. Another advantage is that we can correctly identify customers’ pallets whilst respecting the specificity of each customer and in line with the GALIA and VDA automotive standards. This enables us to guarantee zero logistical errors at our customers’ sites in terms of identification.”

This heightened visibility and accuracy of shipment has helped contribute to the fact that “70% of our packaging can be recycled, and the same packaging can be used with several customers. We need to be able to monitor the amount of packaging available and its distribution across all of our customers’ sites,” which has enabled such efficient use of materials and high levels of re-use.

Automated data collection, display, and ease of use all translate into greater efficiency, fewer errors and less waste. Real-time visibility into production performance allows managers and supervisors at Valeo to be much more proactive to better address potential operations issues, which then helps to further remove waste from their production process.

At the same time, these efforts have contributed to the company’s green efforts. Couple these efforts with a solution capable of delivering visibly and control across nearly 100 sites, and it soon becomes apparent that the savings and organizational impact of these programs are far reaching – all the way to the bottom line – while at the same time achieving greener, more sustainable operations.

Manufacturers Lack Supply Chain Visibility beyond Tier 1 Suppliers

Wed, 15 May 2013 17:47:34 -0400

lobal manufacturers are putting their supply chains at the center of their business strategies to serve as the foundation for operational efficiency and collaborative innovation, according to audit, tax and advisory firm KPMG LLP. The company’s 4th annual Global Manufacturing Outlook – Competitive Advantage – Enhancing Supply Chain Networks for Efficiency and Innovation surveyed 335 C-level executives globally, including 95 in the United States.

Ironically, many manufacturing executives (49 percent globally; 54 percent U.S.) admit that their companies currently do not have visibility of their supply chain beyond Tier 1 suppliers. Moreover, only 9 percent of the 335 global respondents of the 2013 KPMG survey say they have complete visibility of their supply chains. That number is even lower among U.S. executives, with only 7 percent claiming complete supplier visibility.

“Obtaining real-time visibility across all tiers in the supply chain can significantly increase speed to market, reduce capital expenditures and manage risk,” said Jeff Dobbs, global sector chair, Diversified Industrials, and a partner with KPMG in the United States. “Moving toward a demand-driven supply chain is probably the single most important step a global manufacturer can take today.”

However, this could prove challenging, as Dobbs points out that “much of the supply chain technology is outdated.” In fact, 44 percent of respondents overall say they still use email, fax and mail as the means to communicate issues about demand in the supply chain. “The winners will be the ones who can network real-time across their entire supply chains, reducing the information lag that costs companies significant time and money,” adds Dobbs.

When asked about their ability to assess the impact of an unplanned supply chain disruption, a similarly small percentage of executives, (9 percent global; 7 percent U.S.) say they are able to assess the impact within hours. However, the most frequent response among global executives was 1-6 days (36 percent) and U.S. respondents most frequently said 1-2 weeks (32 percent).

To help manage supply chain risk and continuity in the event of unanticipated disruptions, executives (58 percent globally; 71 percent U.S.) say they plan to regionalize or localize their supply chains.

Overall, China and the U.S. remain the top sourcing locations, but the report shows that many will keep sourcing closer to their major markets over the next two years. Nearly 90 percent of U.S. respondents will increase sourcing in the U.S. followed by Canada (18 percent) and China tied with the U.K. at 13 percent.

Focus on Growth and Innovation

On the growth front, a third of all companies globally and in the U.S., and 47 percent of larger companies (over US$5 billion in revenue), are looking to pursue mergers and acquisitions over the next two years. In the U.S. specifically, executives indicate that the priority transactions for their companies will be investing in Greenfield opportunities in growth markets, M&A and innovation driven by enhanced collaboration in the supply network seen as growth drivers.

Manufacturers maintain that investment in R&D is essential for growth: 38 percent of U.S. respondents expect to invest 4 percent or more of revenue in R&D and innovation over the next 24 months which is 20 percentage points higher than the level being invested currently, according to the findings. Seventy-one percent of U.S. respondents say their R&D will largely be incremental, with a focus on enhancing existing products and lines, 29 percent plan to invest in breakthrough innovation, comparable to overall global results.

“As companies step up investment in innovation, whether in search of breakthrough R&D or incremental improvements, they are increasingly
looking to their supply network for ideas,” Dobbs commented.

Innovation Borne by the Supply Network

Just over half of global respondents (51 percent) say that partnerships with suppliers will define the direction of innovation, and over the next two years, 57 percent expect at least 10 percent of their revenues to come from innovations. Yet paradoxically, the biggest challenges manufacturers say they have with regard to innovation is aligning it to the business strategy (34 percent), and the complexity in collaborating with suppliers and partners (32 percent).

“Supply chain partners will play a critical a role in a manufacturer's innovation strategy as part of their investment in R&D,” Dobbs added. “Mitigating the challenges of collaborating with partners is complex; close familiarity with who your suppliers are and how they operate will certainly help optimize performance.”

KPMG's Dobbs believes notable shifts in the way companies are redefining and investing is indicative that manufacturing is on the verge of a “hyper-innovation era.” He says, “The sector may appear to be slowly evolving, but it is on the cusp of explosive change in the next 3 to 5 years. The prolonged stage of intense competition, modest growth and a hyper-focus on cost reduction has strongly positioned companies to maximize this next phase of innovation.

“With new data technologies proliferating to enhance partnering, shared efficiencies and visibility, we'll start seeing some breakthrough and disruptive innovation in manufacturing, not only to the products but also to the process.”

Report Methodology

KPMG's 2013 Global Manufacturing Outlook, a report from the Economist Intelligence Unit, is based on a survey of 335 senior executives, conducted in November 2012. Executives represented five industries: Aerospace and Defense, Automotive, Conglomerates, Engineering and Industrial Products, and Metals. Forty-six percent were C-level, including board members. Respondents came from companies of many different sizes: nearly 30% represent companies with more than US$5bn in annual revenue. Respondents are distributed globally, with nearly a
third each from The Americas; Asia; and Europe, the Middle East and Africa.

U.S. Spent More on 2012’s Extreme Weather Cleanup than on Schools or Roads

Wed, 15 May 2013 14:40:57 -0400

U.S. taxpayers paid nearly $100 billion responding to damages caused by last year’s extreme weather events associated with climate change, about $1,100 per taxpayer, according to an analysis by the Natural Resources Defense Council (NRDC). By paying nearly $100 billion, taxpayers – through the federal government – spent more on climate change cleanup than on education or transportation, the analysis shows.

Further, the burden to pay for climate disruption has shifted away from private insurers and is falling more heavily on America’s taxpayers. This is occurring at a time when Congress continues to avoid taking action against climate change and instead has cut support to address its causes, the NRDC analysis shows.

“While Congress debates the federal budget, our government is spending more responding to extreme weather made worse by climate change than we are to educate our kids or take care of our bridges and roads,” said Dan Lashof, co-author of the report and director of NRDC’s Climate and Clean Air Program. “In fact, this single-ticket expense now tops the list of non-defense discretionary federal spending.

“And taxpayers are shouldering more of the burden – they are spending three times more than private insurers to pay for recovery from climate damages. Fortunately, the government has tools it can use right now to address these climate risks – without waiting for Congress to act.”

Federal spending for the drought, storms, floods and wildfires in 2012 totaled nearly $100 billion. Although climate doesn’t show up as a line item in federal spending, the costs of what NRDC calls the “Climate Disruption Budget” equals one of every six dollars spent on non-defense discretionary programs, making it the largest such spending item, the NRDC report shows.

The impact on America’s taxpayers is startling. The insurance industry estimates that 2012 was the second most expensive in U.S. history for climate-related disasters, with damages totaling more than $139 billion. But private insurers only covered about 25 percent of the costs, leaving taxpayers to pay the bulk of the remaining costs – a ratio of about 3:1 in terms of costs borne by taxpayers versus insurers. This shift in liabilities began in earnest following the $72 billion bill to the insurance industry in 2005 from Hurricane Katrina, and has continued to grow since, the NRDC report shows.

“The fact that private insurers are leaving the table sends an unmistakable signal. It tells us that climate change risks are increasing and their costs to our society are climbing,” said Steyer. “$100 billion is a big expense by any measure. Good fiscal stewardship of our country’s future dictates that we should be spending more to combat climate change so we can spend less on cleaning up its impacts.

“President Obama has called on Congress to curb the threat—and rising cost—of climate change and said if Congress balks, he will act. The sooner we make sound investments to curb the pollution driving climate change, the quicker we’ll reduce its drag on the federal budget and our economy.”

Steps the government can take to reduce drivers of climate change include ramping up energy efficiency and reducing carbon pollution. Several months ago, NRDC released a ground-breaking proposal addressing climate change: “Using the Clean Air Act to Sharply Reduce Carbon Pollution from Existing Power Plants, Creating Clean Energy Jobs, Improving Americans’ Health, and Curbing Climate Change.”

NRDC’s plan would reduce carbon pollution from the nation’s electric power plants, which are responsible for 40 percent of our total carbon emissions. NRDC’s proposal calls on the U.S. Environmental Protection Agency to use the Clean Air Act to set state-specific limits on carbon pollution. States and utility providers would work together to meet the new limits in a flexible system promoting energy efficiency and use of a broad mix of cleaner energy sources.

NRDC’s plan would cut carbon emissions by 26 percent by 2020 at low cost with high environmental and health benefits, and would save utility customers on their electric bills.

Learn more about the NRDC’s climate disruption costs analysis.

Read Lashof’s blog post.

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