It’s difficult to examine the business pages these days and not run into issues such as global warming, climate change, sustainability and renewable energy. Corn crops are being tapped by the automotive industry for ethanol. Staples’ distribution center in Killingly, Connecticut, is powered by one of the largest solar panel installations in the Northeast. The European Union and China each activated Restrictions on Hazardous Substances laws. Even former U.S. Vice President Al Gore won the Best Documentary Academy Award for his analysis of the trends facing the environment in his film An Inconvenient Truth.
As these and similar concepts be-come more prevalent and accepted in today’s vernacular, it’s important to understand how such issues affect our industry and individual businesses.
What Is Sustainability?
In an article titled, “The Green Supply Chain,” Patrick Penfield, an instructor of supply chain management at the Whitman School of Management at Syracuse University, defined supply chain sustainability as “the process of using environmentally friendly inputs and transforming these inputs through change agents, whose byproducts can improve or be recycled within the existing environment. This process develops outputs that can be reclaimed and re-used at the end of their life cycles.”
Why Should I Care?
In the United States and around the world, there is a growing concern about climate change. The primary source of that concern is the emission of carbon dioxide related to the combustion of fossil fuels. The California Air Resources Board (CARB) passed guidelines in 2006 greatly reducing the acceptable amount of hydrocarbon and nitrous oxide emissions from large-spark ignition engines, including those in forklifts. CARB passed additional legislation in 2007 for diesel engines. Manufacturers and distributors alike should be familiar with these rules as the deadlines for compliance come nearer. Companies, including many of your customers, are spending millions of dollars to comply with these stricter pollution prevention and environmental cleanup laws.
According to Michael Short, program director of the Cleveland, Ohio-based Clean Air Conservancy, “This is a radical step. You pay the city to carry your sewage out. You pay someone to come pick up your trash. But you don’t yet pay for the emissions out of your tailpipe or smokestack. That’s the last place you’re able to dump your waste at no cost. But there are literally more and more and more companies and more states that are beginning to commit themselves to doing it.”
What Steps Are People Taking?
More than 165 nations are signatories of the Kyoto Protocol to the United Nations Framework Convention on Climate Change and have already begun to put in national programs to reduce greenhouse gas emissions. The United States has not signed that agreement, so no mandatory federal programs to control carbon emissions exist. However, there is much activity at the state level. The Clean Air Conservancy’s Short says, “Currently, 31 individual states have greenhouse gas registries. Between now and 2009, the national-scale program is going to be a hot topic of discussion in the Senate, and it will certainly pour out into the popular media, universities and industry.”
Where Can I Learn More?
Plenty of resources are available to learn more about environmental policies, regulations and discussions.
Environmental Protection Agency — “The Lean and Green Supply Chain: A Practical Guide for Materials Managers and Supply Chain Managers to Reduce Costs and Improve Environmental Performance,” a written guide from the Environmental Protection Agency, provides a systematic approach for implementing an environmentally friendly supply chain. This document is available for download at www.epa.gov.
California Air Resources Board — The government agency that oversees air quality rules for the state of California has a history of setting the standards that are eventually adopted by much of the rest of the country. Get up to speed on the latest regulations at www.arb.ca.gov.
Alternative Fuels Data Center — Created by the U.S. Department of Energy, the Alternative Fuels Data Center is a vast collection of information on alternative fuels and the vehicles that use them. Alternative fuels described here are those defined by the Energy Policy Act of 1992, including biodiesel, electricity, ethanol, hydrogen, natural gas and propane. This site has more than 3,000 documents in its database, an interactive fuel station mapping system, current listings of available alternative fuel vehicles, and lots of alternative fuels information and related links. (www.eere.energy.gov/afdc)
Chicago Climate Exchange — The world’s first and North America’s only legally binding rules-based greenhouse gas emissions allowance trading system. The commodity traded at the Exchange is the CFI Contract, each of which represents 100 metric tons of CO2 equivalent. Exchange members make a voluntary but legally binding commitment to meet annual greenhouse gas emission reduction targets. Those who reduce below the targets have surplus allowances to sell or bank; those who emit above the targets comply by purchasing Carbon Financial Instrument (CFI) contracts. Members include companies such as DuPont, IBM and Bank of America, as well as municipalities like Aspen, Colorado, and Portland, Oregon. (www.chicagoclimatex.com)
Regional Greenhouse Gas Initiative — A conglomerate of 11 states in the Northeast agreed to the first mandatory greenhouse gas emissions reduction program in the United States. Central to its mission is the implementation of a multiple-state cap-and-trade program and market-based emissions trading systems because “greenhouse gases are not bound by state or national borders.” Proposals include required electricity generators in participating states to help reduce CO2 emissions. (www.rggi.org)
Sustainable Energy Coalition — More than 60 national and state-level business, environmental, consumer and energy policy organizations joined forces to promote increased federal support for energy efficiency and renewable energy technologies and reduce federal support for unsafe or polluting energy resources. (www.sustainableenergycoalition.org)
Lift-Rite Goes Green
Several years ago, The Toyota Corporation mandated that all its companies establish an environmental management system and become ISO 14001:2004 certified. Lift-Rite Inc., a Toyota company based in Brampton, Ontario, Canada, took this mandate to heart.
Lift-Rite first obtained the ISO 9001:2000 Quality Management System certification in December 2006. The ISO auditor’s report stated, “Lift-Rite’s QMS is a mature system reflecting good quality practices that have been developed and implemented over time. The staff demonstrated a good understanding of the practices, policies and procedures.” Once armed with the 9001:2000 certification, Lift-Rite set its sights on the stricter 14001:2004 standard. To achieve this, organizations must demonstrate that they are responsible for their impact on the environment, which Lift-Rite shows through an Environmental Management System (EMS). President Mel Griffin explains, “We are committed to complying with applicable acts, regulations and by-laws, and other environmental requirements. We will work closely with their suppliers to establish appropriate environmental standards.”
All Lift-Rite employees contribute by minimizing energy consumption (gas, water and electricity), reducing waste, increase recycling and ensuring that activities are safe. Lift-Rite earned its ISO 14001:2004 certification in April 2007. “One of our goals at Lift-Rite is to produce a green product,” Griffin says. “We recognize that protection of the environment is a key element in good business practice.”
A green project is underway courtesy of Edgerton Corporation President Bob Walters in conjunction with a non-profit group called the Clean Air Conservancy, whose program director Michael Short is creating a slightly different type of calculator than what most of us are used to. Designed to calculate a vehicle’s overall annual contribution of CO2 into the atmosphere (known as its “carbon footprint”) based on its performance and fuel type, the forklift calculator is similar to ones Short created for automobiles, boats and air travel. The “NETZERO” calculators are available at http://www.cleanairconservancy.org/calculator.php.
Walters is using his material handling experience and contacts to provide Short with information about the makes and models of lift trucks in the population. “It’s a work in progress,” Walters says. “Automotive information is more readily available than forklifts, but we’re working on it.” Although not yet functional, the calculator’s potential has Walters intrigued. “We have a program that allows a salesperson to calculate the overall cost of purchasing a lift truck,” Walter says. “We want to add this CO2 calculation into that to give end-users a more accurate picture of what their forklift is doing.” Walters expects the forklift calculator to be ready by the end of 2007.