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Freight Sustainability Future Depends On Strong EPA SmartWay Program

By EDF Blogs / Published: November 22, 2011

This commentary was originally posted on the EDF Business Blog by Jason Mathers, EDF’s Corporate Partnerships Project Manager.

Source: EPA SmartWay

On the train back north from the U. S. Freight Sustainability Summit this past Friday, two thoughts kept circling around in my mind:

First, the U. S. EPA SmartWay program has created a powerful coalition working on freight sustainability, and its efforts have produced significant benefits for the environment, economy and energy security.
Second, the gulf in scale of action between where we are today and where we need to be is enormous.

Environmental Defense Fund (EDF), the American Trucking Associations (ATA) and the Retail Industry Leaders Association (RILA) co-hosted the freight summit.

Since its inception, EPA SmartWay has injected $6.1 billion dollars into the U. S. economy by reducing fuel consumption from the nation’s freight system– producing a heck of a return for the small investment that taxpayers have made into this program. In the process, it has cut over 16 million metric tons of carbon pollution. It’s a great start.

However, 16 million metric tons is a small percentage of the overall emissions attributed to the freight sector – over half-a-billion metric tons a year in the U. S. alone. And, as we heard again and again at the Freight Sustainability Summit, demand for goods movement is expected to grow significantly over the coming years. So, we simply need to do more.

There were many reasons for optimism at the summit. Top among these is the collective focus of industry, advocacy groups and government agencies on working collaboratively to further this effort. There is universal recognition that we must radically increase the efficiency of freight movement in order to meet the challenge of increasing levels of freight demand while still facing a tighter fuel market, an aging and overextend infrastructure and an environmental mandate to cut carbon.

We also heard scores of success stories from some of the largest and most sophisticated companies in the world. Lowes has reduced a million tons of carbon already from its fleet. Conway told the group how it cut fuel consumption by six million gallons simply by reducing the top speed for its trucks (now 62mph for less-than-truck load and 65mph for truckload applications). Swift shared some impressive results from its pilot of a new aerodynamic fairing that is bolted on underneath a trailer. Michelin told us about real-world studies demonstrating a 9% improvement in fuel economy for tractor-trailer combinations that use new generation wide base tires. My personal favorite was from Home Depot, which was able to cut its domestic supply chain freight emission by 13% in one year – largely from operational improvements.

It’s not just the Fortune 500 group of companies that are acting. Smaller companies shared their stories too. Vic LaRosa, the president of Total Transportation Services, spoke about how his company is helping reduce air pollution around some of the nation’s busiest ports by leveraging alternative fuels and advance vehicle technologies. Several speakers mentioned how small firms and owner-operators will benefit from increases in truck fuel efficiency.

These stories and other sparked by the leadership of the EPA SmartWay program make very good business sense too. Walmart alone has cut its fuel costs by half-a-billion dollars a year since 2005 from improved logistics.

Clearly, progress is being made and more – much more – is possible.

Consider for a second that—based on the SmartWay data points of $6.1 billion saved and 16 million metric tons carbon reduced – the average cost of a ton of carbon reduced under this program is negative $381. That is every ton reduced was accompanied by a nearly $400 dollar savings for the company. We’re not dealing with the low-hanging fruit of cutting freight emissions. We are largely dealing with the apples already on the ground.

Given these massive cost savings still available and the fact that the best science tells us that we need to cut our emissions on the order of 80% over the next 40 years, it is imperative to move freight sustainability well beyond 16 million metric tons that the program has achieved over seven years in fact, we need five to six times these reductions each year going forward.

How do we do this?

First and foremost, we need the EPA SmartWay to remain a strong program. Given its track record of financial returns for society and the urgency of the freight sustainability challenges we face, the program, frankly, should be greatly expanded. SmartWay provides incredibly useful forums for sharing lessons learned. This new generation of tools are performance-based; they enable shippers to track and manage their emissions footprint, while giving carriers a platform where they can compete on environmental performance. Companies that use the services of this vital program should make sure policymakers understand the value it provides.

Next, shippers – the companies that consumer goods movement services – need to step up to the plate and join the program in much larger numbers. As they are the primary customers in the freight economy, shippers play a critical role in rewarding superior environmental performance of carriers. If your company purchases goods movement services and you are not sure if it is a member of SmartWay, you can check here. If it turns out that your company has been on the sidelines of this effort, you can join SmartWay here.

We all need to redouble effort to share lessons learned. As Randy Mullet if Conway noted, like safety and security, companies should freely share their advancements on sustainability. The journey is too long and the challenge too steep for all of us to have to figure out the answers individually

Finally, the freight community needs to aim higher. Significant progress has been made over the last seven years of the SmartWay program. The buy-in from diverse stakeholders, case studies from partners and new generation of tools has created a foundation upon which we all need to build a new freight future; one that measures success against an ever larger scale.

Posted in Washington, DC / Comments are closed

New EPA/DOT Vehicle Standards – The Reality Behind The ‘Job Killing’ Sound Bite

By Jackie Roberts / Published: November 22, 2011

Last week, I wrote about energy efficiency’s role in greenhouse gas standards for power plants and the reality behind the “Job killing EPA regulations” sound-bite. The recently announced new fuel economy and greenhouse gas standards for light vehicles provides further evidence that the reality of Environmental Protection Agency (EPA) regulations is job creation, not job destruction.

According to the government, the “proposed program for model year 2017-2025 passenger cars and trucks is expected catalyze demand for currently-available, innovative technologies including advanced gasoline engines and transmissions, vehicle weight reduction, lower tire rolling resistance, improvements in aerodynamics, diesel engines, more efficient accessories, and improvements in air conditioning systems. The standards should also spur manufacturers to increasingly explore electric technologies such as start/stop, hybrids, plug-in hybrids, and electric vehicles [and] … includes a number of incentive programs to encourage early adoption and introduction of “game changing” advanced technologies, such as hybridization for pickup trucks.”

U.S. auto companies are already investing in these new technologies as the best bet to gain market share in the world economy. The Energy Department’s battery program (an investment of $2.4 billion in 48 advanced battery and electric drive projects) is ensuring that the U.S. supply chain is ready so that we don’t just buy batteries from Japan and others. According to the Department of Energy (DOE), the United States is on track to achieve a 40% share of global capacity to produce lithium-ion batteries for vehicles by 2015. An assessment of the battery value chain by Duke University shows at least 50 U.S.-based firms are involved to date, with 119 locations in 27 states performing manufacturing and research and development (R&D).

We have leading material science experts in Dow, Dupont and 3M that can help design new composite materials to help meet the need for less weight. The 70,000 tire workers would love to have a chance to make the most efficient, low rolling resistant tires- and then sell those tires to the rest of the world. A second value chain assessment of hybrid vehicle technology shows U.S. firms dominating the hybrid market for medium and heavy-duty trucks, putting the U.S. in a great position to develop hybrid light duty pick-up trucks.

At every turn, there are job creation possibilities. What the EPA and Department of Transportation (DOT) proposal does is ensure that the market for efficient vehicles is a strong and vibrant market, one that grows jobs at every turn. Furthermore, ensuring that U.S. firms have enough customers today – the key ingredient to growing a healthy business – is the only way to compete in the global markets of tomorrow. EPA regulations maintain auto jobs and create new jobs in sectors such as battery manufacturing. Now, the new battery plant by A123 Systems lithium ion in Livonia, Michigan won’t have to fire the 300 new workers it just hired.

For consumers, these improvements would save an average of up to $6,600 in fuel costs over the lifetime of a model year 2025 vehicle for a net lifetime savings of $4,400 after factoring in related increases in vehicle cost. Overall, the net benefit to society from this rule would total more than $420 billion over the lifetime of the vehicles sold in model year 2017-2025. No lost jobs here.

In sum, this is what “job killing EPA regulations” look like in the real-world.

Posted in Washington, DC / Read 1 Response

2011 World Energy Outlook Implications

By Drew Nelson / Published: November 10, 2011

By: Drew Nelson, EDF’s Clean Energy Project Manager

Source: IEA

Yesterday the International Energy Agency (IEA) released its 2011 World Energy Outlook. The report models expected demand for energy in three scenarios: a business as usual scenario, an aggressive policy scenario to cut greenhouse gas emissions and a middle of the road scenario. As a result of this analysis, the report lays out some pretty eye-catching conclusions. The conclusion that will likely receive the most press attention is summed up by the head of the IEA, who states:

“[by] 2015 over 90% of the permissible energy sector emissions [to avoid dangerous climate change]… will already be locked in [due to investments in carbon-based energy sources]. By 2017, 100%. We can still act in time to preserve a plausible path to a sustainable energy future; but each year the necessary measures get progressively tougher and viciously more expensive.”

In other words, we only have five years to make investments in the energy sector that avoid locking us into a future of dangerous climate change. Any delay will be more expensive than taking action today. Some of the best scientists, economists, and business officials who drafted and provided comments on this report are clear – NOW is the time to make the urgent investments needed in clean technologies like wind and solar as well as smart-grid technologies to deliver that clean energy to consumers.

However, another conclusion of the report caught our eye here in EDF’s energy program. For the scenarios that were modeled, natural gas was “the only fossil fuel for which demand rises in all three” scenarios. This highlights the important role that natural gas will play as an energy source no matter how aggressive policy-makers are in reducing greenhouse gas emissions. Natural gas use will grow because deposits of “unconventional” sources of gas, like shale gas, are being discovered and drilled in almost every part of the globe. The report finds that the share of unconventional gas production in North America is projected to rise so that there will be more “unconventional” gas in North America than “conventional.”

This has broad implications. Increased shale gas means greater energy security and jobs, but also potential increased impacts in the backyards of some of our most populous states. There are significant public concerns with shale gas drilling: water quality, air pollution, noise, wildlife impacts and increased traffic are some of the most common. New data is also showing that current methane gas leakage rates are cutting into the previously accepted greenhouse gas benefits of natural gas.

Yet many oil and gas industry representatives, rather than working with the public, are dismissive of these concerns. At an industry gathering last week one representative referred to critics of shale gas as an “insurgency.” This comes on the heels of a gas company announcing that it has employed former military officials who specialize in “psychological operations” in order to help “convince” communities of the merits of shale gas. Many companies continue to refuse disclosing the chemicals they are pumping into the earth. These actions do not build trust or goodwill and could endanger further growth of shale gas. The IEA report states that growth in output of natural gas will “depend on the gas industry dealing successfully with the environmental challenges: a golden age of gas will require golden standards for production.”

At EDF we are working to develop those golden standards and ensure that shale gas is developed the right way in order to maximize the benefits of shale gas without sacrificing public health, environmental protection and safety.

Posted in Natural Gas / Comments are closed

DOE Roadmap Toward Cleaner Natural Gas Development – Sign Reads “Still Under Construction”

By Mark Brownstein / Published: November 10, 2011

Today the Department of Energy’s Shale Gas Production Subcommittee released a final report that follows up on its earlier recommendations for increased oversight and transparency, assesses their implementation to date and lays out a roadmap for improvement. The report proposes a focused set of steps for strengthening environmental management in the shale gas industry and developing this abundant energy source in ways that safeguard public health and the environment.

The report is a call to action, stating “Americans deserve assurance that the full economic, environmental and energy security benefits of shale gas development will be realized without sacrificing public health, environmental protection and safety” and the Subcommittee believes that these recommendations, if implemented, would make real progress toward meeting these goals. Time is of the essence, though, as the ramifications of inaction pose more risk every day.

While much more remains to be done to ensure shale gas development is safe for people and the environment, important progress is currently underway on federal, state and local levels. The EPA, for example, has proposed rules to reduce air pollution from oil and gas development activities that, while needing improvement, are a critical first step. Likewise, we’ve seen that states can move very quickly to update their oil and gas rules when they have a mind to. For example, in only the past eleven months Arkansas, Texas, Montana and Louisiana have adopted requirements mandating the disclosure of chemicals found in hydraulic fracturing fluid. And Colorado, New York, New Mexico and North Dakota have recently proposed requirements relating to fracturing fluid chemical disclosure. In Pennsylvania, West Virginia and Ohio, legislatures have passed, or are in the process of debating, more stringent regulations on the exploration and production of natural gas.

EDF is actively engaged across the country to further the safety and environmental protection of our natural resources wherever the production of natural gas is occurring. It’s a long, cross-country road trip on highways still under construction. We’re prepared for the long haul.

Posted in Natural Gas, Washington, DC / Comments are closed

It Makes Dollars & “Sense” To Capture Air Emissions

By Susanne Brooks / Published: October 24, 2011

Oil and gas exploration and production is rapidly expanding across the U.S. due to technological developments that have made extraction of previously untapped unconventional resources such as shale gas feasible.

In fact, shale gas production “has gone from a negligible amount just a few years ago to being almost 30% of total U.S. natural gas production.”

But national clean air standards covering these activities have not been updated since 1985 in one case and 1999 in another. They are limited, inadequate, and out of date, particularly given recent technological advances in this area.

This poses a serious problem, since exploration and production activities emit numerous hazardous air pollutants and other airborne contaminants that threaten human health and the environment. Communities across the country are paying the price, suffering from air pollution in the absence of protective, comprehensive standards.

In July, the Environmental Protection Agency (EPA) proposed new nationwide safeguards to reduce air pollution from upstream oil and gas production activities. Recently, the public was given a chance to express their opinions on the issue at three hearings held in Pittsburgh, Pennsylvania, Denver, Colorado, and Arlington, Texas. EDF testified at all three. (Public written comments will be accepted through November 30^th and EPA is required to issue a final rule by February 2012. You can submit comments online, via fax or through the mail. In your correspondence, please be sure to reference Docket Number EPA–HQ–OAR–2010–0505; FRL–9456–2.)

I testified at the EPA hearing in Pittsburgh where compelling concerns were raised by many in the communities hard hit by air pollution impacts. People in communities across Pennsylvania expressed concern that adequate protection from dangerous pollution in their home state is simply not in place. Some pleaded with the EPA to finalize new standards, others expressed anger that EPA has not done so already, and many fear that the new standards won’t be tough enough to keep their families safe.

The individual who testified before me declared that when it comes to our health and that of our children, the costs of cleaning up harmful pollution should not factor into EPA’s decision-making. He got a standing ovation.

Of course, the hearing also featured industry representatives, some of whom echoed the position of the American Petroleum Institute (API) calling for more time to comment on the proposed standards and to delay their implementation.

Yet, the truth is that the proposed EPA rules will standardize many practices and technologies already being used in states such as Colorado and Wyoming, and elsewhere by natural gas companies. Further, these practices and technologies reduce gas losses, which results in greater recovery and sale of natural gas, and thus increased economic gains. The return on the initial investment for many of these practices is sometimes as short as a few months and almost always less than two years. In these tough economic times, it would seem wise to eliminate waste, save money, and reduce environmental impact.

Based on EPA estimates of natural gas losses, industry lost more than $1 billion in profits in 2009 due to venting, flaring and fugitive emissions. The U.S. Government Accountability Office (GAO), with supporting data from EPA, estimates that around 40% of natural gas estimated to be vented and flared on onshore federal leases could be economically captured with currently available control technologies. Recouping these losses could increase federal royalty payments by $23 million annually, at a time when revenue is desperately needed.

The industry can demonstrate their commitment to bringing natural gas to market in an environmentally sound way by using best practices, acknowledging the benefits of these safeguards, and being proactive in helping them get adopted.

And, while EPA’s proposed rules are a great start, there is room for improvement (for more details, see EDF’s preliminary analysis of the regulations). Bottom line: it is critical that stronger clean air standards move forward. They are vitally important to protect human health and the environment.

At the EPA hearing in Pittsburgh, the public demanded that EPA require industry to be more vigilant about health and safety, and reduce their environmental impact. Considering the potential increased revenue of capturing more gas, advocating for strong clean air rules makes both dollars and “sense.”

Posted in Natural Gas, Washington, DC / Comments are closed

The Great Lakes Symposium: Bringing The Smart Grid To The Nation’s Center

By Kristen Coracini / Published: October 24, 2011

Source: Medill Reports

View Miriam Horn, director of EDF’s smart grid initiative, speaking with Medill Reports about exciting highlights from the event here.

The first annual Great Lakes Symposium for Smart Grid and the New Energy Economy kicked off last Tuesday, as leaders gathered from across the Midwest and the country to share information on what benefits and challenges a smart grid can deliver to the region. The event was kicked off by Chicago Mayor Rahm Emanuel, promoting energy conservation as the “fifth fuel” (I’d put it first myself). The opening included a moving tribute to Bob Galvin, the pioneer and innovator who created the Galvin Electricity Initiative, one of EDF’s symposium partners.

While the weather didn’t cooperate – it was cold, rainy and, true to Chicago’s nickname, very windy – the panels and events were excellent and informative. The opening keynote, moderated by Joyce Foundation president Ellen Alberding, included representatives from GE and Silver Springs Network discussing how to place the Midwest in a leadership position in the new energy economy. This question is fundamental to why EDF and our partners chose the Midwest for this conference: the region has just the right mix of manufacturing and high tech industries and a strong agricultural base. Perhaps even more importantly, the Midwest needs a smarter, greener grid to transition from its heavy reliance on coal for electricity, to cleaner resources, such as energy efficiency and renewables – and to accommodate the emerging electric vehicle market. And while electricity prices are relatively cheap in this part of the country, they are steadily rising. In his answer to the question, GE’s Luke Clemente noted that a smart grid will enable more renewable energy to be generated in the Midwest, keeping more money in the communities in which the power is generated and contributing to their economic development.

After the keynote, the symposium split into three separate tracks: a Midwest Policy Summit, a Consumer track and an Innovation and Economic Opportunity track. While this allowed attendees to choose the panels that best addressed their particulars interests, it created a bit of a Sophie’s Choice for me, having to decide which panels to attend and which I would have to miss. Fortunately, four of my EDF colleagues were also in attendance, so we were able to cover all the bases. In fact, three of my colleagues, Miriam Horn, Mark Brownstein and Lauren Navarro, each participated on panels, making it clear that EDF is the leading environmental organization working on these important issues to ensure that the smart grid’s promised environmental benefits are in fact delivered.

I opted for a panel on “Leading Practices for Ensuring Consumer Empowerment,” moderated by Pecan Street’s executive director Brewster McCracken. Pecan treet is an innovative smart grid test bed in Austin, Texas, and there’s a lot to be learned from what they’ve done and continue to do there. Brewster shared some fascinating information on “disruptive innovation” as the necessary catalyst for advancing technology. Silver Springs Networks’ Eric Dresselhuys built on this theory by discussing the smart grid movement as one born from disruptive forces and opportunities: first out of the need for reliability, more recently as a reaction to environmental policies and consumer interest and finally to enable emerging resources, such as distributed renewable energy.

I won’t detail every panel I attended, but I’m grateful that staff at the Illinois Institute of Technology were on hand to video all of the events for future reference, which will be housed on the Symposium’s website. Immediately after the symposium, I attended the first ever Perfect Power Seal of Approval^TM Academy, a program created by the Galvin Electric Initiative to evaluate power system performance. The program is based on a series of well-defined metrics, including reliability, cost, consumer empowerment and efficiency and environmental performance. EDF helped develop the environmental metrics, which assess a broad range of issues, from emissions to land impacts to waste. Roughly thirty grid operators attended the academy, and will receive a certificate for their participation. The Seal of Approval is based on similar principles of perfection as the Six Sigma certification, which was developed by Bob Galvin. It’s a tool that will no doubt prove invaluable.

As a native North Carolinian, I’ve been thrilled to spend some time in Chicago and the Midwest over the past year, working with great partners to bring a smarter, greener grid to the region. The Great Lakes Symposium was an excellent coming out party for EDF, and is only the start of bigger things to come. My heartfelt gratitude goes out to our partners at the Joyce Foundation, the Illinois Institute of Technology, the Citizens Utility Board, the Illinois Science and Technology Coalition, and everyone else who made this event a great success.

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