Smithfield Foods, World’s Largest Pork Producer, Sets Goal to Reduce Its Carbon Footprint

A lot has changed since I first started working to reduce pollution from hog farms in North Carolina. That was back in the 1990s, during my early years at Environmental Defense Fund.

Back then, industry wasn’t exactly eager to sign on to new, environmentally-friendly technologies to manage hog waste. So it’s gratifying now to work with Smithfield Foods, the world’s largest pork producer, as it voluntarily commits to reduce its carbon footprint in a meaningful way.

Hog farms have long created both environmental and health problems for residents in the coastal plain of eastern North Carolina. Manure in the farms’ waste lagoons produces methane, ammonia, and other gases that contaminate both the air (causing respiratory problems as well as accelerating climate change) and the water (where nitrogen contributes to algae blooms, and at times, large-scale fish kills).

I collaborated with North Carolina State University for many years in evaluating possible technologies that can reduce pollution from pork production. This work led to 2007 legislation in North Carolina that banned new permits for lagoon and sprayfield hog manure treatment systems and established environmental performance standards for alternative treatment systems.

Now it’s 2016, and Smithfield has decided to take the lead in the animal protein industry by reducing its greenhouse gas emissions by 25 percent by 2025. That’s more than 4 million metric tons, or the equivalent of removing 900,000 cars from the road. But in order to succeed, it first had to understand its baseline emissions footprint. That kind of assessment required a thorough lifecycle analysis — a careful look at emissions produced throughout the company’s supply chain, from raw materials to disposal to retail to in-home consumption.

Smithfield graphic

Smithfield graphic

Companies’ individual lifecycle assessments are critical to developing plans to reduce greenhouse gases. The quality of the data collected for the assessment determines how useful the results will be in planning the changes companies will undertake to meet their goals. Company-specific data illuminates individual emissions hotspots in supply chains — those critical points where companies can focus their energy and attention to reducing negative impacts most effectively.

Smithfield contracted with the University of Minnesota’s NorthStar Institute for Sustainable Enterprise to create a custom greenhouse emissions inventory for the company, and EDF agreed to review the analysis.

Let’s take a look at the two major greenhouse gas emissions hotspots the lifecycle analysis identified, and how Smithfield plans to reduce greenhouse gases:

  1. Pigs consume a great deal of corn (as well as soy) which requires a large amount of nitrogen and other nutrients often provided by industrially-produced fertilizer. When applied to the land, the nitrogen in the fertilizer results in the release of nitrous oxide from soils, which is a potent greenhouse gas. In fact, feed production accounts for about 20 percent of Smithfield’s greenhouse gas emissions. The solution? EDF is working with Smithfield to optimize its fertilizer use, so it can get the crop yield required to feed the pigs while minimizing the surplus nitrogen which fuels nitrous oxide emissions.
  2. The other dominant emission hotspot comes from manure management. In Smithfield’s case, this accounts for more than a third of its greenhouse emissions. Hog manure is typically flushed from the barn into an open earthen lagoon. Smithfield now plans to cover lagoons to reduce the methane that’s released into the air on 30 percent of its company-owned farms. Smithfield is also committing to help its contract growers do the same. Those lagoon covers will also prevent ammonia from being lost to the air — a huge benefit because atmospheric ammonia losses result in public health and environmental risks. By capturing ammonia under the lagoon covers, Smithfield can use it as fertilizer, offsetting some of the inorganic fertilizer the company otherwise would have to purchase.

While these commitments by Smithfield Foods will not solve all (or even a majority) of the public health and environmental impacts of hog farms, this is a meaningful step by the company. It is also promising that NorthStar’s work with Smithfield can be readily adapted to other companies to develop their own lifecycle analysis.

I’m encouraged that Smithfield is taking a leadership role in this endeavor, and proud of the roles that EDF has played. EDF will continue to work with Smithfield to make this commitment a reality, and to address the remaining issues associated with pork production.

It is my hope that the commitment by Smithfield Foods will encourage other livestock producers to step up and take the actions necessary to reduce the public health and environmental impacts of their operations.

Posted in News, Partners for Change, Science| Comments are closed

Western Leaders, Attorneys General Support BLM’s Oil and Gas Waste Policies in Court

8362494597_b5e016f63f_z-300x169By Jon Goldstein and Peter Zalzal

(This post originally appeared on EDF Energy Exchange)

The legal fight to defend the Bureau of Land Management’s (BLM) recent efforts to prevent oil and gas companies from wasting methane on public and tribal owned land continued yesterday.

EDF and a coalition of local, regional, tribal and national allies filed a brief opposing efforts by industry organizations and a handful states to block BLM’s protections before they even come into effect. 

The states of New Mexico and California also sought to participate in the legal challenges, likewise stepping up to defend BLM’s common sense standards. Notably, New Mexico is the largest producer of oil from public lands in the U.S. and the second largest producer of natural gas.

In seeking to stay BLM’s protections, the industry associations have claimed the standards have no benefits – so blocking them won’t have any impacts on the communities they are designed to protect.

But BLM’s oil and gas waste standards are about ensuring that operators use common sense technologies to capture natural gas that would otherwise be wasted. That preserves a valuable natural resource and cleans up the air, all while putting additional royalty payments in the pockets of Western communities that can be used to fund schools, roads and important infrastructure.

For example, a recent analysis found that in 2013, oil and gas companies operating on public and tribal lands wasted more than $330 million worth of gas – more than $100 million of that from New Mexico alone. This translates to lost royalty revenues for local communities. One report estimates that without action to reduce this waste, taxpayers could lose out on more than $800 million in royalties over the next decade.

The challengers’ legal claims stand in stark contrast to the facts on the ground. Evidence of the broad-based benefits of BLM’s Waste Prevention Rule was readily apparent in yesterday’s court filings supporting the protections..  Current and former state and county officials and everyday Westerners alike let their voices be heard about the importance of common sense measures to preserve public resources and protect the environment.

For example, in their filing seeking to participate in the case, the states of New Mexico and California emphasized:

Implementation of the Rule will benefit the States of California and New Mexico by generating more annual royalty revenue . . . . In addition, the Rule will benefit the health of the states’ citizens who are exposed to harmful air contaminants leaked, vented and flared from federally-managed oil and gas operations . . . . The People of California and New Mexico have a strong interest in preventing the waste of public resources, as well as in reducing the emission of harmful air pollutants that threaten the health of the states’ citizens, the integrity of their infrastructure, protection of their unique environments and ecosystems, and the continued viability of their economies. ( Filing, pages 2 and 3)

And in their filing opposing the preliminary injunction, these states claimed:

Because the Rule is likely to result in the stronger protection of federal lands and greater prevention of the waste of natural resources, which belong to the People, the public interest weighs strongly in favor of denying the injunction. (Filing, page 16)

The benefits that New Mexico and California identified are broadly shared and were likewise reflected in declarations submitted by county officials and former state officials in support of the standards.

Current La Plata County Colorado Commissioner Gwen Lachelt identified both the problem of resource waste on public lands and the benefits for Western counties like hers in addressing it:

The San Juan Basin, in which La Plata County is situated, has one of the highest rates of wasted gas and methane loss in the country, accounting for nearly 17% of U.S. methane losses.

In addition to wasted methane, oil and gas sites in La Plata County and the San Juan Basin release dangerous pollutants such as benzene and ozone-forming pollutants that can lead to asthma attacks and worsen emphysema . . . . This air pollution continues to be a regional public health hazard, and has contributed to La Plata County receiving a low grade for poor ozone air quality from the American Lung Association…

The Rule will benefit La Plata County by providing additional royalties that we can use to fund key County priorities—including infrastructure, roads, and education—while also helping to clean up the air in the San Juan Basin, which will have health benefits for our citizens. (Filing, page 4 and 5)

Lachelt points out that unlike other leading oil and gas states like Colorado, New Mexico has no policies to reduce methane waste and other pollution from oil and gas wells, and that BLM’s efforts will help to provide uniformity across state lines.

Sandra Ely, a former Chief of the New Mexico Environment Department’s Air Quality Bureau likewise submitted a declaration describing the importance and benefits of the BLM standards. She particularly focused on the long-standing problem of resource loss in the San Juan Basin. The region made headlines in recent years when NASA scientists discovered a 200-square-mile methane cloud over the region – the largest methane cloud uncovered in the U.S. Subsequent studies determined that oil and gas emissions were the main contributor to the methane “hot spot.”

I am aware of a recent study, focused on the San Juan Basin, which suggested that BLM’s proposed leak detection and repair requirements alone would result in anywhere from $1–$6 million dollars of additional revenue for New Mexico… Absent the Waste Prevention Rule, I am concerned that resource loss and poor air quality associated with oil and gas development will continue unabated in New Mexico (Sandra Ely, Filing, page 7)

Western leaders have been vocal in their support for BLM’s sensible standards that take an important energy resource out of the air and deliver it responsibly to the American public. At public hearings that the BLM held across the west these rules were supported by more than 3 to 1 margins. More than 80 local officials across the West, including county commissions in La Plata, Park and San Miguel counties in Colorado and Bernalillo, Rio Arriba and San Miguel counties and the Santa Fe city council in New Mexico, all support the protections. And these rules enjoy broad bipartisan public support as well (more than 80 percent of Westerners in a recent poll).

Given this cross-cutting support and yesterday’s forceful legal filings, it’s no wonder that industry challengers in this case don’t even want the judge to hear the views of New Mexicans and Californians. Yesterday, they indicated that they would oppose these states’ efforts to protect the interests of their citizens by participating in the case. While this reflexive obstructionism isn’t surprising—industry petitioners filed their legal challenges within 40 minutes of the rule being finalized and tried to block the standards’ effectiveness shortly thereafter—it certainly reveals their very one-sided view of what is in the public’s interest.

The Wyoming Court is scheduled to hear oral argument in this case on January 6. We look forward to continuing to defend these standards that will clean the air and prevent waste.

Posted in Economics, Energy, Greenhouse Gas Emissions, Health, News, Partners for Change, Policy| Comments are closed

Latino Voters Agree: Now is the time to reduce pollution and invest in clean energy

By Lucía Oliva Hennelly, EDF Campaign Manager, New Climate Partnerships & Andy Vargas, EDF Congressional Hispanic Caucus Institute (CHCI) Public Policy Fellow.

How important do you think it is that the next President and new Congress take steps to reduce smog and air pollution? What about actions to develop clean energy sources like wind and solar power?

These are a questions asked by Latino Decisions, a leading national polling firm, in a representative national poll of Latinos who voted in the 2016 elections. Latino Decisions research released this week shows that 75 percent of Latino voters believe it is extremely or very important that the next President and Congress take steps to reduce smog and air pollution. And 71 percent of Latino voters believe it is extremely or very important that the next President and Congress take steps to pass legislation to aggressively combat climate change. This was also found in key states including Arizona, Colorado,  North Carolina, and Nevada.

While the results should not be surprising, they are noteworthy in a month when President-elect Donald Trump has nominated an environmental antagonist to lead the Environmental Protection Agency and the CEO of ExxonMobil to lead the State Department.capture

These findings demonstrate that Latino communities care deeply about our environment, our changing climate, and how this impacts our families. The assumption that Latino voters only care about immigration reform — despite being disproportionately impacted by issues like air pollution and toxic exposure – needs to be discarded. Read More »

Posted in Energy, Health, Jobs, Latino partnerships| Comments are closed

How Companies Set Internal Prices on Carbon

Despite the uncertainty created by the recent election, companies around the globe are demonstrating a commitment to keeping climate change in check. More than 300 American companies signed an open letter to President-elect Trump urging him not to abandon the Paris agreement. Others are acting on their own to reduce emissions in their daily operations, by setting an internal price on carbon.

The number of companies incorporating an internal carbon price into their business and investment decisions has reached new heights, a recent CDP report shows, with an increase of 23 percent over last year. The more than 1,200 companies that are currently using an internal carbon price (or are planning to within two years) are using them to determine which investments will be profitable and which will involve significant risk in the future, as carbon pricing programs are implemented around the world. Sometimes, they also use them to reach emissions reduction goals.

Not all carbon prices are created equal, and companies differ in how they set their specific price. Here’s a look at some of these methods:

Incorporating Carbon Prices from Existing Policies

 Some companies set their carbon price based on policies in the countries where they operate. For example, companies with operations in the European Union might decide to use a carbon price equal to that of the European Union Emissions Trading System (EU ETS) allowances, and those operating in the Northeastern United States might adopt the carbon price that results from the Regional Greenhouse Gas Initiative market.

ConocoPhillips, for example, focuses its internal carbon pricing practices on operations in countries with existing or imminent greenhouse gas (GHG) regulation. As a result, its carbon price ranges from $6-38 per metric ton depending on the country. For operations in countries without existing or imminent GHG regulation, projects costing $150 million or greater, or that results in 25,000 or more metric tons of carbon dioxide equivalent, must undergo a sensitivity analysis that includes carbon costs.

Using Self-Imposed Carbon Fees

Others take a more aggressive approach by setting a self-imposed carbon fee on energy use. This involves setting a fee on either units of carbon dioxide generated or a proxy measurement like energy use. These programs also often include a plan for using the fees such as investment in clean energy or energy efficiency measures. This can be an effective method for incentivizing more efficient operations.

Microsoft, for example, designed its own system to account for the price of its carbon emissions. The company pledged to make its operations carbon neutral in 2012 and does so through a “carbon fee,” which is calculated based on the costs of offsetting the company’s emissions through clean energy and efficiency initiatives. Each business group within Microsoft is responsible for paying the fee depending on how much energy it uses. Microsoft collects the fees in a “central carbon fee fund” used to subsidize investments in energy efficiency, green power, and carbon offsets projects. Still, by limiting carbon fees to operational activities, Microsoft has yet to address a large chunk of their emissions.

Setting Internal Carbon Prices to Reach Emissions Reduction Targets

 Other companies set an internal carbon price based on their self-adopted GHG emissions targets. This involves determining an emissions reduction goal and then back-calculating a carbon price that will ensure the company achieves its goal by the target date. This method is a broader approach focused more on significantly reducing emissions while also mitigating the potential future risk of carbon pricing policies.

Novartis, a Swiss-based global healthcare company, uses a carbon price of $100/tCO2 and cites potential climate change impacts as a motivator. The company has its own greenhouse gas emissions target, which it is using to cut emissions to half of its 2010 levels by 2030. These internal policies mean that Novartis, which is included in the European Union’s Emissions Trading Scheme (EU ETS), has been able to sell surplus allowances and thus far avoid an increase in operating costs.

Where we go from here

 While these internal carbon pricing activities are welcome – and we hope they continue – they are not sufficient to reduce greenhouse gases to the degree our nation or world requires. Like these forward thinking companies, nations around the world, including the United States, need to consider the costs of inaction, including the climate-related costs, to avoid short-sighted investments. Ultimately, we will need public policies that put a limit and a price on carbon throughout the economy.

The spread of internal carbon pricing could signal greater support for carbon pricing by governments. But companies can do more: the ultimate test of a company’s convictions and commitment to carbon pricing might be their willingness to advocate for well-designed, ambitious policies that achieve the reductions we need.

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Groundbreaking Study Shows New Coal Plants are Uneconomic in 97 Percent of US Counties

By: Ferit Ucar

At Environmental Defense Fund (EDF), we understand that market forces can drive either a healthy environment – or harmful pollution. I recently wrote about how generating electricity often creates pollution, which comes with environmental and health costs that are usually not paid for by the polluters. That’s why EDF works to identify and correct market failures, like the failure to understand – as well as account for – all of the costs pollution imposes on society.

The Energy Institute at the University of Texas at Austin (UT) just released a useful tool in that pursuit: a studythat aims to capture the full cost of new electric power generation – including environmental and public health costs – on a county-by-county basis in the United States. The study evolves traditional ways of estimating new generation costs by 1) incorporating pollution costs, and 2) breaking data down to the county level.

The results show economics are leading the U.S. to a cleaner energy economy, in which there is no role for new coal plants. Let’s break it down.

Enhancing the levelized cost method

The Levelized Cost Of Electricity (LCOE) method is commonly used to compute the costs of different power sources – including fossil fuels and renewables – on a comparable basis. The LCOE, expressed on a dollar per kilowatt-hour (kWh) basis, is the estimated amount of money it takes for a particular electricity generation technology to produce a kWh of electricity over its expected lifetime.

In its conventional form, the LCOE method does not take into account environmental and public health costs – costs external to electricity generation but caused by it. It also does not show the variation in costs of building and operating identical power plants across different geographies. The study provides an improved method that addresses these limitations. The study also factors in siting challenges – like water availability and access to fuel – that prevent certain plant types from being built in a given county.

The UT study presents results in a map format, which facilitates cost comparisons by fuel source, technology, and location. The study team released interactive maps that show the cheapest technology by county, as well as calculators that enable users to compare costs for different scenarios.

Key findings

The following U.S. map shows the least-cost technology when factoring in siting limitations, and environmental and public health costs. The key displays the number of counties in which each power technology is the least-cost option.

map-1

The analysis shows:

  • Wind is the least-cost option in the most number of counties.
  • Coal plants are never the least-cost option.
  • Natural gas combined cycle (NGCC) plants are the least-cost option in counties where the wind isn’t as strong.
  • Utility-scale solar photovoltaic (PV) plants are the least-cost option in counties where it’s particularly sunny and/or there is a lack of cooling water availability, which is needed for thermal generation like coal.
  • When a county faces siting challenges that prevent other technologies from being built, residential solar PV plants (like rooftop solar) are the least-cost option. Put another way, rooftop solar is a viable option in every county; other power sources are not.

If you remove the environmental and public health costs from the analysis, the map looks different:

map-2

Even without accounting for the environmental and public health costs, wind remains the least-cost option in over 1,000 counties – that’s about one third of U.S. counties. And solar appears on the map nearly five times as much as coal.

Caveats

Although the study presents an improved way to measure the costs of electricity generation, we should acknowledge its limitations. It does not:

  • Remove the subsidies received by coal and natural gas during the exploration and extraction process, which effectively make fossil-fuel plants appear less costly than they actually are.
  • Account for the uncertainty of future fuel prices and capacity factors for fossil fuel and nuclear plants.
  • Demonstrate the environmental and public health benefits of retiring an existing fossil-fuel plant. As the study states, if emission rates from existing (rather than new) power plants were used, the public health costs would, on average, be 10 times higher.
  • Factor in the costs associated with managing the variability in wind and solar’s generation output.
  • Model the implications of the federal Production Tax Credits and Investment Tax Credits for renewable generation technologies, as well as subsidies at the state or local level, which affect investment decisions. (The calculators do allow changes to capital cost assumptions; so therefore, these could be factored in).
  • Consider economic factors other than cost – like revenue – that also affect investment decisions.
  • Account for the high-level environmental damage risks associated with electricity generation from nuclear, natural gas, and coal as a result of incidents like Chernobyl and Fukushima, Aliso Canyon, and Dan River coal ash spill that cause massive, long-term, acute, and dispersed chronic harm.

    The Energy Institute study clearly shows the economic viability of wind and increasing prospects for solar.

The Energy Institute study clearly shows the economic viability of wind and increasing prospects for solar. Moreover, it provides policymakers and the public with important information on the full cost of electricity for new power sources – including the environmental and public health costs such as asthma attacks, premature death, and lung damage resulting from fossil-fuel pollution.

When pollution costs are accounted for, as the UT study shows, coal power plants are not the lowest-cost electricity generation technology anywhere. Even without including environmental and health costs and renewables subsidies, and despite the fact extraction of coal remains subsidized, new coal plants are still not economic in 97 percent of U.S. counties. As we work to fix outdated rules, we know that market forces are helping to clear the way for clean energy progress and cleaner air.

This post originally appeared on our Energy Exchange blog.

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Defending BLM Standards that Reduce Waste, Protect Air Quality

us-doi-blm-logo-300x261EDF, along with a coalition of health and environmental groups, just filed a motion to intervene in defense of vital new standards that will prevent the wasteful loss of natural resources, save money for taxpayers and tribes, and reduce emissions of dangerous and climate-disrupting pollution.

The Bureau of Land Management’s (BLM) waste prevention standards will reduce venting, flaring, and leakage of natural gas on BLM-managed federal and tribal lands – but they are being challenged in U.S. Federal District Court in Wyoming by oil and gas industry groups and three states.

Federal and tribal lands are an important source of oil and gas production. Together, the amount they produce is the equivalent of five percent of the U.S. oil supply and 11 percent of the U.S. natural gas supply, and generates more than $2 billion annually in royalties.

Unfortunately, oil and gas companies that lease these federal and tribal lands lose substantial amounts of publicly-owned natural gas through unnecessary venting, flaring, or leaking at production sites.

A recent study from ICF International found that in 2013, drilling on federal and tribal lands —mostly in the rural West— leaked, vented, and flared natural gas worth about $330 million. An analysis from the Western Values Project estimates taxpayers could lose almost $800 million over the next decade if wasteful venting and flaring practices continue.

In addition to wasting a public resource, oil and gas companies’ unnecessary venting, flaring, and leakage on federal and tribal lands also poses significant public health and safety risks.

The wasted natural gas is primarily composed of methane – a powerful greenhouse gas, capable of warming the climate at a rate 84 times that of carbon dioxide over a 20-year period.

The leaked, vented, and flared natural gas also emits air pollutants including carcinogens such as benzene, and volatile organic compounds – which contribute to hazardous smog.

BLM’s recently finalized venting and flaring standards deploy common sense, cost-effective, and readily available technologies — already effectively in use in several states across the country — to capture this gas.

The standards yield significant benefits by minimizing the waste of a taxpayer-owned natural resource, and by curbing emissions that contribute to air pollution and climate change, all while helping to create new jobs in methane mitigation. They will save, and put to productive use, up to 56 billion cubic feet of gas a year — enough to supply up to 760,000 households – and will provide millions in additional revenues for taxpayers.

The standards will also cut methane emissions by up to 169,000 tons per year — the equivalent to carbon emissions from as many as 890,000 vehicles.

These benefits will accrue to millions of people across the country, including those living near oil and gas development on federal and tribal lands.

EDF member and New Mexico rancher Don Schreiber has more than 100 oil and gas wells on and near his ranch in the San Juan Basin that will now be covered by the BLM standards. In a declaration supporting EDF’s motion to intervene, he describes the impact of venting, flaring, and leaking from these wells on his family and, in particular, his grandchildren:

Most noticeable is the near-constant smell from leaking wells. …  These odors make breathing uncomfortable and often cause us to leave affected areas as quickly as possible. … We worry about [our grandchildren’s] exposure to air pollutants from oil and gas development on the property, and always are careful to keep them away from the wells and above ground pipeline equipment. Protecting our grandchildren from the negative health effects of oil and gas emissions is a constant concern when they come to visit us. (New Mexico rancher Don Schreiber, Declaration)

With the new standards, he anticipates a reduction in the “harmful air pollution near my home and in the state where my family and I live, work, and recreate.” (Declaration)

BLM’s efforts to reduce natural gas waste have broad and cross-cutting support from elected officials and community members across the West. In a recent bipartisan poll of Western states, 80 percent of respondents supported BLM standards to curtail waste of this valuable resource. And, over the course of several years during which the rule was under development, BLM solicited the feedback of community stakeholders, oil and gas developers, and local, tribal and state governments. The final rule is the result of a collaborative and deliberate process and includes changes that reflect this stakeholder input.

Standing in stark contrast to this careful process, industry associations rushed to file legal challenges seeking to overturn the waste prevention rule within 40 minutes after it was released — hardly enough time to read the rule, let alone meaningfully consider its contents.

And in a subsequent filing seeking to block these protections before they become effective, these industry associations put forward a number of flawed claims, not least of which was their suggestion that BLM acted unlawfully because its rule may “only” produce additional annual royalty revenues of $22.4 million — a sum the filing characterizes as “de minimis.”

While $22 million annually may be an insignificant amount for the oil and gas companies litigating to overturn this rule, it has real meaning for infrastructure projects, schools, and communities across the country that stand to benefit from this funding.

It’s unfortunate that some have engaged in reflexive efforts to roll back protections designed to prevent the waste of our nation’s public resources and, at the same time, protect our air quality and climate.

The good news is that BLM’s commonsense standards are firmly rooted in the agency’s manifest authority to minimize waste and to address the harmful health and environmental consequences of oil and gas development on federal lands.  We at EDF look forward to vigorously defending these standards in court.

Posted in Economics, Energy, Greenhouse Gas Emissions, Health, Partners for Change, Policy| Comments are closed
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