Making money by reducing emissions

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Courtesy of VisionMonitor Software, LLC

Efforts to reduce emissions are really about changing companies’ behavior. Pressure on companies from various activist groups combined with daily headlines in national and international media are driving various agendas among federal, state and local regulators. The current financial crisis does not appear to have lessened this pressure, rather the opposite. Compliance is now a must; non-compliance will not be tolerated and hefty penalties, corporate and personal liabilities will be incurred.

So what is a company to do? Faced with pressures from financial markets, shareholders, customers, communities and employees should they now spend their limited funds on complying with stricter environmental rules? I contend that this investment carries a higher ROI than just about anything else at this time.

First, start by assessing the risks of going forward with business as usual. Know your carbon footprint and the value of your emissions assets. Get a handle on your current environmental process. Assess your current systems for collecting environmental data. If this is an excel spreadsheet with manual data entries, think about how you will collect this data in a real time operating environment. Think about how you will manage this data in a real time environment. Think about how your future operation will be affected by actions you take today and about how actions you take today will affect your future operation.

Your environmental operation is just that – it is part of your operation. It is an increasingly more important part. It can no longer be viewed as simply a staff function where the Plant Manager says to the EHS Director, “Are we in compliance?” Compliance is a must and a given. One of our clients once told me that the fines resulting from non-compliance do not hurt nearly as much as the required “fixes” when you operate in a reactive fashion. In a company organized for the future, the senior environmental officer is the CEO. He will ask questions like: “What is the expected return on environmental investments made this year?” “How can we maximize the return on our emissions assets for next year?” “Are there any environmental risk factors that can surprise us next year?” He will demand the company operate in a proactive fashion using actionable, real time data as a basis for operating decisions.

Other than from the media, where does the actual pressure come from to change how a company develops and executes its environmental strategy?

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