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Detroit’s Carbon Footprint – now what?

18 Nov 2014

Not a carbon footprint

Not a carbon footprint

A couple of years ago, my son was watching a cartoon where one character discussed his villainous carbon foot print (a giant foot).  This showed me both how widespread the use of the term “carbon footprint” had become and how little anyone seems to know what to do with or about that information.  A group at the University of Michigan recently released findings calculating the City of Detroit’s cumulative carbon footprint and presented their report to Mayor Duggan’s office.

Not surprisingly, the study reported that some 66% of the City’s emissions come from stationary sources including residential and commercial buildings and another 30% result from transportation. Those are known to be large sources of emissions.

What I found interesting is that 41% of the city’s total emissions are produced in just 4 of the City’s 33 ZIP codes – primarily from the City’s southwest, midtown and downtown areas. Citywide, greenhouse gas emissions totaled 10.6 million metric tons of CO2 equivalents in 2011 and 2012. According to the report, if you drove from Detroit to Ann Arbor 60 times, your car would emit roughly one metric ton of CO2.  Also interesting is that, on a per capita basis, Detroit’s 2012 emissions are below average when compared to data previously collected from 13 other U.S. and Canadian cities. Detroit’s per capita emissions ranked 9th-lowest among that group—below Cleveland, Denver, Pittsburgh, Ann Arbor and Washington, D.C.  Per capita emissions were lower in Baltimore, Boston, Minneapolis, Chicago, Philadelphia, Toronto, Seattle and New York City. That one always surprises, but New York with its many tall buildings is surprisingly efficient on a per-capita basis. The report shows that electricity use contributed 45% to 2012 citywide emissions, in large part because of DTE Energy’s fuel mix, which includes 76% coal.

Now that we know where the City’s “low hanging fruit” of CO2 emissions can be found, the City may be able to work on assisting its property owners and businesses to reduce those emissions, which typically go hand-in-hand with cost savings.  That’s often the best way to sell such changes – not based on an environmental change, but based on an economic one.  One more thing for Mayor Duggan’s team to work on.

Earth Day at 44…. still crying?

22 Apr 2014

Earth Day brings me right back here

Earth Day brings me right back here

Happy Earth Day 44.  We have come a long way from the challenges and problems that led to the first Earth Day –  a 1969 oil spill in Santa Barbara, California; the dead zone in Lake Eriesmog in Los Angeles and burning rivers in the Midwest.

The first Earth Day led to the creation of the US Environmental Protection Agency and the passage of environmental laws like the Clean AirClean Water, and Endangered Species Acts.  As the EPA and its state counterparts have continued to regulate, there has been a backlash of business and media outcry which certainly impacts the public’s views.

The challenges we face today are more complex and likely more daunting than those of 44 years ago.  We still have oil spills, but they are from rail cars, pipelines, larger ships and deeper wells.  Lake Erie and many other bodies of water are still challenged by more diffuse and “below the radar” sources of contamination.  While reducing the impacts of asbestos, lead and NOx from our daily lives, and healing the ozone hole, we now face questions regarding greenhouse gasses, smog impacts from and in China unlike anything LA ever faced, and the challenges and benefits posed by fracking.

Once the “low hanging fruit” of easy cleanups were “picked,” what we were left with was less shocking or engaging than dead fish and burning rivers.  Consequently, there’s much more debate about the best way to address them or whether they need to be addressed at all.  The issues are just as important – maybe more so, but it’s unlikely that our polarized nation would agree on what changes would be best, if any.

Payback is a b*tch

12 Jun 2013

As regular MichiganGreenLaw readers know, about 18 months ago, we added insulation to our home.  While three years of data (one before, one of and one after) is not a big enough database, I spent time evaluating at the last three years of our DTE and Consumers Power invoices.  What I learned is that our sense that our house was warmer in the winter and stayed cooler in the summer appears to be accurate.  We saw a reduction in our usage and, while rates vary over time, it does appear that we are saving money.  Now we find ourselves asking how long before this improvement pays for itself in savings?

This is the question that many businesses ask before making alternative energy investments – “How long before I recoup my investment?”  Often, in the post-2007 era, businesses will insist on less  than three years.  Savvy investors know that there are many different methods used to analyze capital projects including net present value (NPV), internal rate of return (IRR), cash flow, profitability index (PI), and payback period.

The payback period method does not take into account the time value of money, the likely increase in costs of energy ($4.30 a gallon of gas, anyone?) and this method doesn’t consider cash inflows after the initial investment is recovered (except the recognition that it’s “all gravy” conclusion).  The payback method’s biggest advantage is it is easy to apply and understand.  However, as more and more authors are writing, this method is misleading and often unfair – as this author notes, no one asks for the payback on home amenities. In short, when making these investments, one must treat them as investments and, taking into account incentives, cash flow, cost of money, projected increases in the cost of energy, (not to mention the ability to market the greener approach or the societal value of a smaller carbon footprint)  consider whether investing in greener equipment or processes is the best use for the company’s funds when compared to other investment opportunities. In many cases it may be the best investment, despite a longer than desired payback period.

New FTC “Greenwashing” Guidance

4 Oct 2012

In 2010, I posted about greenwashing and the Federal Trade Commission’s  (FTC)  proposed response to it.  This week, the FTC  issued revisions to its “Green Guides” to help marketers ensure that their environmental claims are not deceptive.

FTC’s revisions include updates to the existing Guides, as well as new sections on carbon offsets, “green” certifications and seals, renewable energy and renewable materials claims.  The FTC modified and clarified the previous Guides and provided new guidance on environmental claims that were not common when the Guides were last reviewed.

The Guides warn against broad, unqualified claims that a product is “environmentally friendly” or “eco-friendly” and also:

• advise not to make unqualified claims about a product’s waste degradability unless they can prove that the entire product or package will completely break down and return to nature within one year after typical disposal – in particular the FTC took the position that items destined for landfills, incinerators, or recycling facilities will not degrade within a year; and

• clarified guidance on compostable, ozone, recyclable, recycled content, and source reduction claims. For example, just because something may be technically compostable, does not mean that it should be touted as such – if an average person cannot compost it with the rest of their compostables.

The Guides contain new sections on: (1) certifications and seals of approval; (2) carbon offsets, (3) “free-of” claims, (4) non-toxic claims, (5) “made with renewable energy” claims; and (6) “made with renewable materials” claims.

Certifications and seals may be considered endorsements covered by the FTC’s Endorsement Guides.  The FTC also cautions against using environmental certifications or seals that don’t clearly convey the basis for the certification.  The Guides don’t address use of “sustainable,” “natural,” and “organic.” Some organic claims are covered by the U.S. Department of Agriculture’s National Organic Program.

The FTC also released other resources to help explain the Guides, including a 4 page summary and a video.

It is more important than ever to be sure that you claims comply as the FTC has shown that it is willing to bring enforcement actions based on dicey or unsupportable environmental claims.

DOE Releases Green Lease Website.

29 Mar 2012

Photo credit: By Andrea_44 @ Flickr

The Department of Energy (“DOE”) and several partners (including BOMA) recently launched a website (link here) consolidating green lease resources. The website includes sample leases from a number of public agencies, is organized by resource type, and resources are tagged by relevance to audience and building types.

So what is a “green lease”?  A green lease, among other things, seeks to promote energy efficiency by attempting to equitably align the costs and benefits of efficiency investments between building owners and tenants.  Under the majority of “triple net” leases, which is probably the most common type of commercial lease that I deal with on a day-to-day basis, building owners have little to no incentive to invest in efficiency for their building systems because the operating expenses are passed through to their tenants, who would therefore receive all of the energy cost savings.  In other words, if you are the landlord, aside from being “socially responsible,” why would you spend a few extra thousand dollars on a more energy efficient HVAC unit if the cost of running the unit is entirely paid for by your tenant?  A green lease attempts to solve this “split incentive problem.”

While the new DOE website isn’t very robust at the moment, it is just the start of the online library, and it looks to offer some good (and free) basic information about green leasing.