The economy is front and
center these days, and many of us find our budgets being cut, and are forced to get more done with less money. A recent survey by the National Governors' Association found that "states face the most dire fiscal situation since World War II" with a cumulative budget shortfall of $40 billion. Alaska, Idaho, Oregon and Washington are all experiencing budget shortfalls and seeking ways to continue providing services during this new era. Many corporations are laying off workers, or cutting benefits, or seeking other ways to economize. Although some economic indicators suggest that the economy may be improving, economists say that a full recovery is expected to be slow. So, what can we do right now?
P2, of course. Now is an opportune time to do P2 ~ managers are attuned to saving money, and employees that come up with money saving suggestions prove themselves to be valuable assets to their employers. P2 offers "win-win" options that protect the environment, workers, and save money, all at the same time. Perhaps now more than ever, P2 is essential.
Read on for real world examples of how Northwest businesses and governments are working to solve some of their economic woes, through P2 strategies and other creative methods.
Creative Ways to Get More Done, With Less
The Northwest is full of smart people willing to think "outside the box" to solve problems. Strategies range from finding interns to help with projects, to getting free publicity to increase business, to partnering with others to leverage available funding. These strategies may be replicated in other organizations to help advance P2.
Funding a Project
Statistics demonstrate that many energy projects, such as light retrofitting and heating/ cooling upgrades, will save large amounts of energy and money. But with high up-front costs, and a tight economy, it may seem wise to wait to conduct the upgrades. Energy Star representatives say this is often wrong: the longer a facility waits, the more money it loses.
The public sector can take advantage of tax-exempt lease purchase agreements and performance contracts that allow upgrades to be funded today, using dollars that will be saved from future energy bills. These mechanisms may even allow upgrades to proceed without having a capital budget. Read more at www.naco.org/programs/environ/pollution/EPA.PDF.
Energy performance contracting is also available to schools, hospitals, multifamily buildings, office buildings and other large facilities. It's a risk free way to fund improvements, and after the contract period ends, the building owner realizes all money savings from the energy upgrades. Learn more at www.escperform.org and check out their list of contacts for more information.
For smaller businesses seeking loans to develop and market environmentally preferable products or to green their businesses, banks that support a conservation economy may be a useful resource. A conservation economy is one that recognizes P2, and moves to make the economy more sustainable. Here in the Northwest, check out ShoreBank Pacific at www.eco-bank.com and Shorebank Enterprise Pacific at www.sbpac.com. Sustainability is a main goal of these lenders and supporting businesses that are also working toward this goal is part of their mission.
SEPs, supplemental environmental projects, are another potential way for government agencies and nonprofits to aquire funding for P2. Companies facing an environmental settlement or enforcement action may voluntarily agree to perform or fund a P2 project. Find more information at www.epa.gov/Compliance/civil/programs/seps.
Lastly, for green building, upgrading equipment, or enhancing the use of renewable power, look for incentives programs. Offered by a variety of sources, they can help cover out-of-pocket expenses for P2 improvements.
For the last two years, Idaho's Department of Environmental Quality has hired summer interns and integrated P2 work into their duties. In 2001, interns conducted over 150 P2 outreach visits to vehicle repair shops throughout Idaho. This year, interns visited over 100 public water systems and conducted assessments, provided recommendations, and answered questions. The intern program allows the agency to go beyond ensuring compliance, to also provide education and P2 recommendations. Furthermore, the interns spend time in the field discussing topics of interest to the operators, learning about their concerns and needs, and facilitating information flow back to DEQ, all at a very low cost.
In 2003, DEQ plans to continue the program and work with the printing industry. For more information, contact Patti Best at 208-373-0146.
Environmental mentoring can help companies achieve environmental results. Benefits accrue to both the mentor and the mentee, including greater efficiency, networking, and enhanced public image.
Mentoring can take on a variety of forms, one of which is simple peer-to-peer exchange. The Oregon Natural Step Network supports peer learning groups that discuss topics of interest and share ideas. Participants learn from each other on topics such as eco-indicators, facilities management, and sustainable investment.
Another model is used by the PEER Center, the Public Entity Environmental Management System Resource Center. A virtual clearinghouse, it is specifically designed to aid local, county, and state governments that are considering implementing or have implemented an environmental management system (EMS) and want to access the knowledge and field experience of other public entities that have done so. Mentoring services can help those considering EMSs learn more, or those already doing it share tips. Find out more at www.peercenter.net.
Working with others can also yield savings, leverage scarce dollars, and promote P2.
For example, PPRC recently partnered with public agencies, industry representatives, nonprofits and trade associations to conduct meetings with P2 content for the medical industry and for businesses concerned with proper stormwater management. Each partner brought different strengths - good mailing lists, meeting organization, publicity, etc. - and the meetings reached large audiences while sharing the workload for each partnering organization. Successful meetings were possible, even though no one partner had enough funding or staff to organize the meetings alone.
In Alaska, P2 staff at the Department of Environmental Conservation learned that another department had funding to do technical data collection on underground injection wells, but did not have staff immediately available to do the work. The P2 staff partnered with the other department. They used the funding to gather the required data, but at each site they also conducted a "mini-site visit" and provided relevant P2 information. Being aware of partnering opportunities made this possible, and the well owners benefitted by receiving information in a single visit. It also provides an example of integrating P2 within an agency ~ a long term goal of the technical assistance community.
When pursuing any P2 project, it's important to conduct measurement to demonstrate the value of the project and to measure its effectiveness. Although it may require a little extra time up front, simple measures can powerfully demonstrate the value of the effort.
As an example, PPRC designed a measurement tool that can aggregate P2 results from Alaska, Idaho, Oregon and Washington. Although it currently includes only a fraction of all the region's P2 work, the combined totals are impressive. Since 1995, water conservation efforts have saved over half a billion gallons of water: the equivalent of drinking water for 6 million people. Hazardous waste has been reduced by 25 million pounds; electricity use reduced by over 587 million kWh (reducing carbon dioxide emissions by over 71,000 tons). These data are generated by aggregating only a handful of all the P2 results happening across the Northwest, yet they prove that P2 investments bring a large return To see the latest totals, visit www.pprc.org/measure.
More than ever, people are paying attention to environmental practices and corporate responsibility (see box). P2 helps improve your bottom line, and publicizing your P2 work helps attract new customers, retain current ones, and make your business stand out from competitors.
Recognition programs offer a great way to announce environmental achievements, and take advantage of the free publicity they generate: a "win-win" situation. A partial list Northwest programs is highlighted in the box below.
Doing Well While Doing Good
In this post-Enron and WorldCom era, you may hear the Common Man grumbling about lack of corporate accountability. Today that Common Man is likely to be making purchasing, and investing, decisions based on impressions of corporate responsibility.
The 2002 Cone Corporate Citizenship Study found that 89% of Americans felt that corporate social responsibility was more important than ever, and many said they would not support companies they considered to be bad actors. 91% of those surveyed would consider switching to another company's products, 83% would refuse to invest in that company's stock, and 76% said they would boycott that company's products or services if they considered the company's corporate image negative.
Forward-looking companies have been watching this trend, and are acting on it. A recent survey by PricewaterhouseCoopers found that many US companies are pursuing sustainability programs. Their top three reasons cited for this are: to enhance their corporate reputation, gain competitive advantage, and experience cost savings. Companies with a sustainability program cited their top five initiatives to work toward sustainability, and P2 was at the top of the list, used by 91% of companies working toward sustainability. (Read the full survey report at www.pricewaterhouse.com/extweb/pwcpublications.nsf/docid/263903B4969664F285256C1B004E73D0.)
So, companies that pursue P2 experience multiple benefits: cost savings, the knowledge that they're "doing the right thing," and stronger staff and customer loyalty. It makes perfect business sense.
Don't Forget the Simple Stuff
While P2 saves money over the long haul, some P2 projects will save money immediately, and many of these are virtually free to implement. Here are a few ideas to consider.
P2 starts with simple reduction, and consideration of exactly what's needed to do a desired task, whether it's running a P2 program or making widgets. Simple waste reduction projects can yield significant savings, and ways to save money may be staring you in the face.
Boeing recently determined that company-wide it was receiving 50,000 copies of the Yellow Pages. A full time staff person was busy with distribution, routing, and recycling all these books! The company now receives this information on CD. It's easier to distribute, search and share phone listings, and staff time has been freed up for other work.
Cutting paper use may also yield savings. The average US office worker uses 10,000 sheets of paper annually ~ that's full two cases per person. Although the up-front paper costs may be small, the full costs add up: office equipment maintenance, handling, paper storage, disposal, etc. A fictional, but typical, analysis of an office with about 100 full-time employees determined that while paper purchases cost roughly $6,600 per year, the full costs of paper use are closer to $57,000 on an annual basis. Find supporting information, and lots of paper P2 suggestions at eetd.lbl.gov/paper.
As part of an effort to reduce paper use, the Idaho Department of Environmental Quality state office reduced its annual paper use by over 2 million sheets since 2001 for a savings of nearly $10,000. Staff achieved this by printing and copying double-sided, accessing popular documents on the agency's intranet, and using email.
Junk mail may be another area to target; in addition to its environmental impacts, junk mail takes valuable staff time to sort and deliver. At one office mailroom in the Seattle area, a six-week study showed that the mailroom staff was spending 25% of its time sorting Standard Class (formerly Third Class) advertising mail! Check out dnr.metrokc.gov/swd/nwpc/bizjunkmail.htm for resources to reduce the amount coming to you.
Classic P2 and Toxics Reduction
You've heard it before: cutting toxics saves disposal costs and protects worker health. But beyond the immediate costs savings, there are other costs that don't always make it into the accountant's ledger.
Reducing toxics may save money through reduced insurance premiums or allowing companies to get better deals. For example, Northwest hospitals that have phased out use of mercury have found that more companies are interested in providing bids. Prices are not necessarily lower, yet the hospitals have more options from which to choose. A Northwest wood products manufacturer switched to less hazardous painting and coating equipment. As a result of reduced cost of workers' compensation, health insurance, and conventional property insurance, annual insurance costs went down over $34,000 per year.
Better worker health, reduced costs for worker's compensation, increased employee satisfaction, reduced paperwork and reporting requirements are all frequent benefits of P2. These cost savings don't always show up in traditional financial calculations, but they always affect the bottom line.
Energy & Water Efficiency
Last year's energy crisis and price hikes provide additional motivation to save money through reducing energy use.
In some cases, new technologies can save money. For example, LED (light emitting diode) technologies have improved markedly over the last few years while prices have dropped simultaneously. Combined with higher energy costs, municipalities are finding it makes economic sense to swap out old incandescent traffic lights for new LED models. They use 80-90% less energy and usually last 5-7 years (compared to the 1 year expected lifespan of a comparable incandescent light signal), so maintenance costs are drastically reduced and payback periods may be quite short. Portland, Bend, Lake Oswego, Lewiston, King County, Snohomish County and others have made the switch.
Lighting is another area ripe for energy efficiency. When Boeing improved lighting efficiency a few years ago, the company saved 200 million kilowatt hours, reduced operating costs by $12 million, and as a side-benefit the improved lighting increased its defect detection rate, so the company's product improved as well.
On a smaller scale, staff at Idaho DEQ have worked with the state office building's landlord to install efficient lighting. The program began in 1998 to gradually upgrade nearly 3000 bulbs in the building. Once complete, the upgrades should save over $4,000 annually on energy bills. In addition to this project, an energy audit recommended the state office conduct a "delamping" project to remove excess lighting. Staff tagged unneeded light bulbs, which facilities staff removed. Elimination of excess lighting will reduce energy consumption by nearly 22,000 kWh/year and over $1,100 annually.
Saving water is another avenue for saving money. For more suggestions on both energy and water efficiency, including links to incentives programs to help reduce up-front costs for upgrades, see PPRC's past newsletter on the topic at www.pprc.org/pprc/pubs/newslets/news0801.html.
Buying environmentally preferred products can save money while supporting markets for products that are more sustainable. PPRC's last newsletter discussed this topic at length. In the vein of saving money, consider these product examples that contain recycled content, work well, and cost a fraction of their virgin counterparts.
Modular carpet tiles can be manufactured from old carpet that has been inspected, cleaned, cut into large squares, and reprinted with attractive patterns. The product is guaranteed, can be applied with water-based adhesive, and individual squares can be replaced as needed, without replacing the whole room's carpet. (One example is EarthSquare at www.earthsquare.com, but many manufacturers make this type of product; for more information, visit www.metrokc.gov/procure/green/bul23.htm.)
Recycled paint is similar, in that it is professionally formulated from leftover paint, tinted, and available at a greatly reduced cost. Kelly Moore blends recycled paint that can be ordered online at www.ecoatonline.com for a quarter of the cost of new paint. Metro in the Portland Oregon area has been collecting surplus latex paint from households and businesses and processing it into high-quality recycled paint since 1992. Metro processes more than 100,000 gallons of paint annually. Check out their colors and prices at www.metro-region.org/article.cfm?ArticleID=521.
Buying cooperatives provide another potential opportunity for money saving while purchasing green products. One example is the Washington State Purchasing Cooperative open to state agencies, political subdivisions and non-profits. The program allows governments to expand the market for green products beyond small niches, and combined purchasing power can help even small customers reap the benefits of lower prices.
When Everett Community Transit, a small political subdivision in Washington, decided to switch to ultra low sulfur diesel, it did so with a prediction that the fuel would cost 15 cents more per gallon than the regular diesel. The Office of State Procurement worked with the vendor to make the ultra low sulfur diesel available through the state contract at a cost of only 9 cents more per gallon thereby helping Everett achieve cleaner air as well as big cost savings!
Learn more about Washington's program at www.ga.wa.gov/PCA/SPC.htm. Oregon Cooperative Purchasing Program also provides similar benefits. Check it out at tpps.das.state.or.us/purchasing/cooperative/about-orcpp.html.
For more discussion of green procurement, how it can save your organization money, and how to overcome common challenges, see PPRC's last newsletter at www.pprc.org/pprc/pubs/newslets/news0902.html.