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How energy companies do (and don't) manage their water footprints

"If climate change is the shark, then water is its teeth," declares Paul Dickinson, CEO of the Carbon Disclosure Project. He paints a grim but appropriate picture of the linkages between water and carbon, and, less obviously, water and energy.

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Topics: Sustainability

Memo to the CEO: How to choose the right policy partners

Welcome back to our series on "Memo to the CEO: How to be effective at the intersection of policy and business." Last week we shared our thoughts on leveraging marketing best practices in your policy work. This week we focus on our fourth principle:

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Topics: Sustainability

Memo to the CEO: A Marketing Plan to Move Your Policy Beyond Spin (part 3 of 4)

Welcome back to our series on "Memo to the CEO: Efficacy at the intersection of policy and business." Last week we shared our thoughts on creating an interdisciplinary team to address policy issues. This week we focus on our third principle:

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Topics: Sustainability

Memo to the CEO: Build a Balanced Team to Achieve Policy Successes (part 2 of 4)

Welcome back to our series on "Memo to the CEO: How to be effective at the intersection of policy and business." Last week we shared our thoughts on how policy is just as much about offense as it is about defense. This week we focus on our second principle:

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Topics: Sustainability

Memo to the CEO: 4 Strategies for the Intersection of Policy & Business (part 1 of 4)

Editor's note: This is the first in a four-part series on navigating the policy world while driving your business toward success.

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Topics: Sustainability

Home Energy Management Takes Center Stage at CES 2012

The Consumer Electronics Show is partly a playground for inventors and partly a glimpse into what technologies consumers will actually adopt in the next few years. Into the first category fall gyro-stabilized electric unicycles, a human-powered hydrofoil, and 3-D pet portraits. It seems that home energy management, on the other hand, has finally landed in the second. 
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Topics: Sustainability

Why EPA Regulations are Important: an Implicit Price for Carbon Emissions

While climate legislation is stalled in Congress, the Environmental Protection Agency (EPA) has pushed forward regulations of pollutants besides carbon dioxide that will drive progress toward cleaner power generation fleets and cleaner air. The major new regulations include Utility MACT (also known as the Mercury and Air Toxics Standards (Mg), the Cross-State Air Pollution Rule (SO2/NOx), 316B of the Clean Water Act (H20), and the Coal Combustion Residuals regulation (coal ash). States, utilities, and legislators have shown both support and opposition in the face of these proposed regulations. Over the last year, there have been many movements to limit the EPA’s power to enforce these standards, most recently 25 states opposing Utility MACT, including the Kansas and Texas lawsuits,Senators Hoeven and Conrad’s legislation, and the FERC Commissioner stating the EPA pace is “too aggressive.” On the other hand, multiple states recently filed motions in support of the EPA, making now a good time to examine some key points and evaluate the synergistic effect of all the regulations.

How will regulations impact coal power generation and the grid?

There are multiple industry studies that analyze the EPA regulations (Credit SuisseNERCICF-FineDBBrattleCRA,ICF-EEIEPABernsteinCERAEIANERABPC). While estimates vary based on different policies and assumptions within each study, they conclude that a combination of all the EPA regulations may result in 25GW to a little over 50GW of coal generation units (2-5% of total electricity generation) to go offline by 2015. This range matches assessments made by Bryan Mignone, a Senior Policy Advisor at the Department of Energy, at the Wharton Energy Conference 2011, an article by energy policy expert Susan Tierney, and an estimate made by Natalie Rolph, chief economist from Black & Veatch, whom I spoke with at Black & Veatch’s Power Industry Briefing.

While the new regulations don’t directly set mandates for CO2 reduction, they do still create a carbon price signal. Some rough assumptions and calculations demonstrate that the marginal cost of abatement to meet the new EPA regulations would be close to ~$7-25/metric ton of CO2e. While a carbon tax would certainly be much more cost effective than the current patchwork of EPA regulations, it’s the only policy approach on carbon the Administration and the EPA have for the foreseeable future.

As coal plants are being retired from the grid, many industry players are pursuing alternate methods of generation to transition to cleaner, and more reliable sources of energy. Natural gas continues to be one of the more popular alternatives as its production yields low emissions and it is projected to have longevity in the market.

Why are the EPA regulations beneficial?

Many birds can be hit with one stone. While compliance costs will vary widely among companies in the industry, from a social cost-benefit standpoint, the cost of compliance is highly reasonable considering the long-term savings in healthcare and environmental expenses. Coal power generation (without advanced pollution controls) emits 99% of all human caused mercury emissions, distributes a hefty amount of SO2 and NOx across state boundaries, blows out ash, sucks in an incredible amount water, and has the highest ratio of carbon to energy output. According to the Energy Information Administration, in 2009, coal power production was responsible for 81% of all the GHG emissions from electricity generation while only producing 48% of electricity. While complying with a single rule like the Cross-State Air Pollution Rule might be financially expensive in the short term for limiting NOx/SO2, it results in relatively cost effective reductions for other pollutants like mercury, coal ash, and most importantly, climate altering CO2. According to EPA studies, Utility MACT and the Cross-State Air Pollution Rule combined will lower health care costs and prevent ~20,000-50,000 premature deaths annually.

Which utilities are best positioned to handle the EPA regulations?

Utilities in the market that anticipated carbon legislation and focused on clean energy will have an easier time handling the new regulations. The heads of eight major utilities (all members of the Clean Energy Group) sent a letter in December 2010 to the Wall Street Journal, titled “We’re OK with the EPA’s New Air-Quality Regulations.” The letter showed their collective agreement that compliance with the regulations can yield “important economic benefits, including job creation, while maintaining reliability.” John Rowe, CEO of Exelon, reiterated his support saying that the majority of the nation’s coal fleet “has or is already in the process of making the kinds of cleanup that is required.” These utilities have understood for a while that coal pollutants are interconnected and that carbon deserves a price. These same companies will benefit as that interconnectedness becomes an implicit reality overtime—that is, if congress does not entirely derail the power of the EPA.
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Topics: Sustainability

Urban Sustainability: New York City’s Bike Lanes and Building Cultural Infrastructure

In New York City, there is an ever-evolving debate surrounding various green-painted stripes crisscrossing the city; otherwise known as bike lanes. One of NYC’s many urban sustainability initiatives to build a “Greener, Greater New York,” bike lanes are intended as a means to encourage alternative transportation and reduce vehicle use, with numerous benefits such as improved air quality, reduced noise pollution and reduced congestion. In New York City, there is an ever-evolving debate surrounding various green-painted stripes crisscrossing the city; otherwise known as bike lanes. One of NYC’s many urban sustainability initiatives to build a “Greener, Greater New York,” bike lanes are intended as a means to encourage alternative transportation and reduce vehicle use, with numerous benefits such as improved air quality, reduced noise pollution and reduced congestion.

However, the bike lanes haven’t been without challenges: claims of business being harmed (though areas where walking/cycling are given primacy can boost retail sales 10-25%), parking spaces lost, pedestrians claim of reckless cyclists, cyclists claim of inattentive pedestrians, and that the green-painted lanes are just plain ugly. Discussion and argument and ways of addressing concerns has been thick: a New York Times Room for Debate discussion has various worthy suggestions, ranging from better enforcement to redefining the legal relationship between drivers, cyclists and pedestrians.

However, prescriptive measures aside, there is a fundamental need for a change in mindset. To enable changes in physical infrastructure, we need to build cultural infrastructure. The way we think, educate, behave and reward needs to support the transformational energy, environmental and infrastructure changes underway as we transition to a low carbon economy. Rules, laws and physical landscape can help inform our thinking and behaviors, but social and cultural norms of human behavior are, arguably, the biggest challenges to a more sustainable future. If we cannot change the cultural infrastructure, physical infrastructure changes will only go so far. Such cultural challenges are being confronted across economies: electric vehicle manufacturers are tackling range anxiety, a product of a car-dependent culture; while consumer goods producers wrestle to rethink planned obsolescence and life-cycle impacts, a product of a disposable consumption-based economy. These are issues rooted not just in physical, but cultural infrastructure.

Car Culture – more than just highways

In NYC—and the US at large—the automobile has presumed primacy. Pedestrians know that the bitumen is not their domain, but this doesn’t always extend to bike lanes. New Yorkers instinctively look for cars when crossing the road (generally); they do not yet instinctively look for bikes when crossing a bike lane. I’ve seen pedestrians lambast cyclists for nearly running them down, when in fact, the pedestrian was the one strolling along the bike lane. Similarly, not all drivers appreciate bike lanes infringing on their bitumen. One New Yorker complained that the bike lanes were taking away her rights as a driver – but what about the rights of non-drivers? It is a safe argument that the primacy of drivers’ rights has been at the expense of non-drivers’ rights for decades, pedestrians and cyclists alike (see one narrative on the evolution of NYC roads).

This historical primacy also extends to the necessary infrastructure for automobiles, namely roads. Eighty percent of NYC public space comprises roads and sidewalks, the majority of which goes to vehicles. In response to a comment by an anti-bike lane resident regarding the “extraordinarily ugly” green stripe on Prospect Park West (this bike lane actually has strong neighborhood support, drastically reducing speeding and increasing bike ridership), I couldn’t help but think, what about the even bigger and, arguably, uglier black stripe outside: the road itself?

This isn’t to suggest we do away with vehicles and roads, but it highlights how we need to expand our current thinking and question the presumed role of roads and cars in urban life. For example, the pedestrian malls along Broadway, only but a few years ago were the target of fierce opposition, primarily from drivers: they are now popular among many residents, improving traffic congestion, quality of life and even local business performance. The street malls were physical, but it took a cultural shift for them to be successful.

Fostering the Cultural Infrastructure of Urban Sustainability

The anti-bike lane mindset does not mesh with the direction our urban life arguably needs to head. But despite early vehement opposition, there are indications of increased acceptance. London’s bike lane growing pains reached a tipping point that the NYC Transportation Commissioner calls an everyday “architecture of safety,” achieved through a combination of physical and cultural infrastructure shifts (though London’s congestion charge helps matters, a similar version of which did not pass in NYC).

Cycling uptake is growing in NYC—evident in my own office even—and biking can even provide a perspective on the city previously unseen, along routes unsuitable for cars and too long for pedestrians – and often faster than public transport. But how is NYC’s bike lane cultural infrastructure progressing? Take this actual example of NYC’s bike lanes still lacking the necessary cultural infrastructure (and please forgive generalizations). Bikes are largely silent relative to the cacophony of other sounds in NYC. Every Sunday behind the Museum of Natural History on Columbus Ave, there is a bustling farmers’ market; but the farmers’ stands and trucks, which they regularly move between, are separated by a bike lane. After many collisions, near misses and arguments, the farmers developed a system. Instead of cyclists being required to ring bells in heavily pedestrian areas to alert of their presence, farmers brought bells of their own. As a bike rode down the line of farmers, bells would begin ringing to alert other farmers of their approach, as well as shouting “Wrong way!” at cyclists doing just that. This wasn’t just to help each other—and the cyclists—avoid injury, but to encourage cyclists to take on this responsibility themselves, which encouragingly, I have since observed occasionally at this location. Here, the cultural infrastructure is evolving and realigning the roles and responsibilities of pedestrians and cyclists as these physical infrastructure changes are frequented more and more.

But this small, self-organizing scale doesn’t necessarily translate well city-wide. To NYC’s credit, however, Mayor Bloomberg and team have recognized that their initial outreach—that is, fostering a new cultural infrastructure—needed improvement and have responded accordingly. This included increased road rules enforcement, bike lanes separated by medians or parking spaces for cyclist safety, and advertising campaigns highlighting bike routes and surprisingly short travel times – Google Maps even has a cycling option for directions now too, showing bike lanes all over the city. NYC is also on the brink of launching a bike-share program. Learning from their insufficient cultural infrastructure development of bike lanes, identifying station locations is being pursued through crowd-sourcing, while demonstrations started in September 2011, well in advance of the summer 2012 launch.

Building major infrastructure is a long-term commitment, and this is similarly true with cultural infrastructure, if not more so. Creating fundamental change in how we reevaluate concepts of value and quality of life will take time. It will require understanding the behaviors and cultural infrastructure of today and how incentives, values and norms can be redirected to build a future all the richer – and all the more sustainable, refocusing the urban quality of life, and thus rebalancing the order and culture of the street. NYC cannot tell people how to think, but it can foster the cultural infrastructure needed for New Yorkers to question presumed driver-primacy, realign pedestrian-cyclist-driver relationships and embrace such a change as largely for the better. If the numerous efforts to improve the environmental performance and quality of life in our cities is anything to go by—with broader regional and global benefits—expect many more urban physical and cultural infrastructure shifts. They may seem painful at first, but given time and with an open mind, you may end up liking what you see.

Author’s Note: I am not a native New Yorker; it is my adopted home. Until two years ago, I have always lived in car-dependent cities. Having to sell my car and rely on public transport (and my own two shoes) made me anxious. I wondered, “What will happen to my freedom to go where I want when I want?” Yet, as NYC has both the cultural and physical infrastructure of public transport over private, my mindset and behaviors quickly shifted with little resistance. Within months, my anxiety was long forgotten, replaced by an unexpected feeling: liberation. I am freer and rarely even see or have the need for one of NYC’s ubiquitous cabs. I don’t ride a bike in NYC either… but I may soon enough.
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Topics: Sustainability

Insights from Net Impact 2011: Overcoming Cynicism to Achieve Great Change

"The single greatest way to change the world is overcoming cynicism." This was the challenge laid down by Lord Michael Hastings in the opening keynote of the 2011 Net Impact conference and it caught me unawares. Is cynicism really the biggest barrier to solving global issues? Is our distrust of others’ apparent motives stopping each of us from taking action? Throughout the conference, CEOs, entrepreneurs and thought leaders shared lessons they’ve learned from business and life experiences that can help us overcome cynicism and drive purposeful change: "The single greatest way to change the world is overcoming cynicism."

This was the challenge laid down by Lord Michael Hastings in the opening keynote of the 2011 Net Impact conference and it caught me unawares.

Is cynicism really the biggest barrier to solving global issues? Is our distrust of others’ apparent motives stopping each of us from taking action?

Throughout the conference, CEOs, entrepreneurs and thought leaders shared lessons they’ve learned from business and life experiences that can help us overcome cynicism and drive purposeful change:

1. “Be who you say you are" A succinct but valuable branding lesson from Tom Kelley at Nike. He went on to introduce the Nike Better World campaign, (check out the slick HTML 5 website if you haven’t already) which aims to educate and inspire young people on sustainability and showcase the best of Nike’s sustainability initiatives. Importantly, it focuses on what Nike is: it is about sport, it is about performance, it doesn’t take itself seriously and it is very, very cool.

2. “Talk to people like they are people” A tip from the Craig behind Craigslist. In a world of social media, the way organizations communicate with consumers has to change. We no longer live in the Mad Men world of one-way communication. Conversations are multidirectional and anyone can join in. Craig’s advice to all of us using social media to engage consumers: (1) it is about sharing the message not controlling it, (2) recognize you are relying on others to transmit your message and they will transmit their version of your message and (3) dive in and don’t be afraid to make mistakes.

3. “Align your own values with how you spend your time” In an energizing keynote, Jen Boulden, a co-founder of Ideal Bites, spoke of how nothing felt better than building a business that aligned with her own values. Ideal Bites, before it sold to The Walt Disney Company, was an email newsletter service that sent subscribers one ‘light green’ eco-tip a day. The target audience was people like the co-founders themselves, individuals who might drive an SUV to Whole Foods but still want to take small actions and be part of a movement. The newsletter that is billed as “a sassier shade of green,” also happens to be an apt description of Jen Boulden.

4. “Measure yourself by the potential” Hannah Jones, VP of Sustainable Business and Innovation at Nike, described Nike’s journey in her closing keynote. She suggested that Nike’s status in the 1990s as the “the poster child for supply chain mismanagement” may have been a blessing in disguise because it set them on a path to become a pioneer in sustainability. Hannah attributed some of this vision to their CEO Mark Parker, who continually reminds the team, "Don't measure yourself by the competition – measure yourself by the potential.” Her parting advice to the 2,600 students and professionals on moving this global economy out of industrial age and into a sustainable economy: (1) reframe the story to focus on the opportunity, (2) obsess innovation and (3) scale by doing one thing gloriously.
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Topics: Sustainability

What If? Insights from the 2011 GreenBiz Innovation Forum

What if we weren’t afraid to fail?

Failure with a capital F discourages risk taking and prevents us from achieving disruptive innovation. That topic was a major theme this month at the GreenBiz Innovation Forum.

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Topics: Sustainability