The Little Green Lies of Environmentally

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The Little Green Lies of Environmentally
Friendly Business

• Ben Elgin
• Investigative reporter
• BusinessWeek

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IPCC conclusions of 2007

• Warming of the climate system is unequivocal.
• Increase in temperatures very likely due to
  man-made emissions.
• CO2 levels in 2005 exceeds natural range of last
  650,000 years.

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Business to the rescue?

• Climate Savers Twelve companies are on pace to
  eliminate 10 million tons of CO2 emissions by
  2010.
• We can reduce the climate change footprint of
  our companies and grow as businesses at the same
  time.
• -- Climate Savers statement

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Lafarge claims

• A commitment to sustainable development dates
  back many years.
• A proactive and radical policy to reduce
  greenhouse gas emissions.

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Lafarge reality

• Emissions
• 1990 79.6 million tonnes
• 2006 96.4 million tonnes
• 2007 98.9 million tonnes

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State of Green Business 2009

• Despite a growing chorus of corporate
  commitments and actions, were less optimistic
  that these activitiesare addressing planetary
  problems at sufficient scale and speed.
• -- Greener World Media

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Key Questions

• What is greenwash?
• What is the harm in it?
• Why do businesses typically fall short in their
  green efforts?
• Where might skeptical media look next?

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Greenwash sustainability?

• Duke Energy
• A way of business that is good for people, the
  planet and profits.
• Sustainability is a journey, not a destination.

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Greenwash sustainability?

• Sustainability is a business approach that
  creates long-term shareholder value by embracing
  opportunities and managing risks deriving from
  economic, environmental and social developments.
  Dow Jones Sustainability Index

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Greenwash sustainability?

• Merriam-Webster A method of harvesting or using
  a resource so that the resource is not depleted
  or permanently damaged.

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Greenwash sustainability?

• Brundtland Commission Sustainable development
  is development that meets the needs of the
  present without compromising the ability of
  future generations to meet their own needs.

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What is greenwash?
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What is greenwash?
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What is greenwash?
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What is greenwash?

• Environmental claims that present a misleading
  picture for consumers and citizens.

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Whats the harm in greenwash?

• Over 28 ski resorts claim to be wind powered
• Vail Resorts 100 powered by wind
• Sugar Bowl Powered 100 by Green Electricity!
• Park City Mountain Resort Offsetting 100 of
  power used

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Value of RECs?

• Supposed to provide economic incentive for new
  wind development
• Cheap, often as little as 2 per MWh
• Many developers say RECs dont influence their
  decisions to build more renewables

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Jiminy Peak

• 386-foot turbine
• Generates 1/3 of resorts power
• Cost 4 million to build
• Saves 200,000 on power costs

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What impedes green progress?

• Impatience to make marketing claims
• Finite availability of capital inside businesses

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Seattle City Light

• 200,000 tons of greenhouse gas emissions/year
• 2000 Earth Day resolution Net zero greenhouse
  gas emissions by 2005

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Seattle City Light

• Biodiesel conversion of city trucks
• 700-1,400 tons of offsets per year
• Cost as much as 220 per ton of reduced CO2

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Seattle City Light

• DuPonts Louisville plant
• 300,000 tons of offsets per year
• Cost 1.95 per ton of reduced CO2

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Seattle City Light

• Our approach initially was very strict. The
  project would only happen if the check came in
  the mail from us. But, we wanted offsets
  quickly, not offsets coming 10 or 20 years in the
  future.
• -- Corinne Grande, strategic advisor to Seattle
  City Light

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FedEx

• Operates over 51,500 ground transport vehicles
• Operates over 675 planes
• Greenhouse gas emissions total more than 15
  million tons per year
• 2008 profit 1.1 billion

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FedEx

• Proclaims to be a green leader
• We have integrated responsible environmental
  practices into our daily operations.
• Launched a new ad campaign to show FedEx is
  doing our part to reduce carbon emissions

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FedEx

• Slow adoption of hybrid vehicles
• In 2004 This program has the potential to
  replace the companys 30,000 medium-duty trucks
  over the next 10 years.
• In 2009 172 hybrids deployed, or 0.5 of its
  fleet

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FedEx

• With 42 savings on fuel that is expected to pay
  for higher up-front costs, why wont FedEx invest
  more heavily in hybrids?
• We do have a fiduciary responsibility to our
  shareholders, Mitch Jackson, environmental
  director at FedEx.

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Future skepticism

• Environmental claims with little data or
  transparency
• Intensity-based targets

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Big claims, little data

• FedEx doing our part to reduce carbon
  emissions
• Google carbon neutral
• Hasbro 43 reduction in emissions since 2000

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Problem with intensity data

• U.S. GHG per real dollar of GDP
• 1990 864
• 2000 711
• 2006 625
• (metric tons of CO2 equivalent per million
  chained dollars)

• Total U.S. GHG emissions
• 1990 6,242
• 2000 7,075
• 2006 7,180
• (millions of metric tons)

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A dose of reality

• At Aspen/Snowmass were trying our best to be
  green, but were not delusional. Our business has
  huge environmental impacts.
• -- from Aspen/Snowmass environmental commitment

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Questions?

• Ben Elgin
• ben_elgin_at_businessweek.com
• [phone]