P2 Pays
Pollution Prevention is Smart Business
A, i .
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Produced by PPRC
Pacific Northwest Pollution Prevention .Resource Center
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What is P2?
CD Pollution
prevention
(P2) is a
way to
improve
your
competitive
advantage
•
j
eliminating
waste
Preventing pollution:
- cuts costs
• reduces liability
improves worker safety
increases competitiveness
- serves public interest
provides regulatory relief
The P2 approach provides oppor-
tunities to:
• eliminate or reduce the use of
toxic materials,
• conserve water and energy,
and
decrease nonproductive output
from processes.
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Cut Costs
A small group of Northwest busi-
nesses and government agencies have
saved over $384 million in the last
decade by reducing waste, using safer
feedstocks, saving
water and
energy, and
driving
fewer
miles.
How
much of
this is
yours?
Cutting water
and energy use, as
well as reducing
waste, has saved more
than $384 million in
the Northwest.
Waste
reduction,
energy sav-
ings, and a safe
work environment directly affect
profitability. During tough economic
times, finding ways to cut costs is
especially important. Pollution preven-
tion is a tool that can help any busi-
ness or industry save money, reduce
expenses and stay competitive.
Sunshine Dairy Foods in
Portland, Oregon,
evaluated its daily water
use, and found that a
$10,000 technology
investment would lead to
40 percent less water use.
These savings add up to
$75,000 per year — a
payback period of less
than two months.
Alaska's ABR, Inc.
conducted an energy audit
and found it was losing
$500 a year on heating-
fuel costs. Installing
temperature-controlled
thermostats allowed the
company to save the
money it had been
spending on extra fuel
costs.
Across the U.S., leading companies
are discovering the value of having an energy-
management strategy. Federal research suggests that
companies that lead in energy management outperform
their competitors by as much as 10 percent.
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Reduce Liability
A Northwest wood
products manufacturer
switched to less
hazardous painting and
coating equipment. As a
result of reduced cost of
workers' compensation,
health insurance, and
conventional property
insurance, insurance
costs went down over
$34,000 per year.
Unfair as it seems, if a
thief steals chemicals
from a business and is
injured, that business
may be liable in the eyes
of the law. A business is
less likely to be held
liable if it takes steps to
reduce its use of
hazardous chemicals and
to install safety devices
and locks.
An industrial coatings manufacturer
in Washington implemented an environmental
management system and a strong pollution prevention
program. These changes led to a 31 percent drop in
both its combined property and comprehensive
liability insurance costs.
Designing toxic materials out of indus-
trial processes can lead to savings on
several levels: reduced worker medical
claims and disability leave, lessened
waste handling and disposal costs,
decreased insurance premiums and
reduced future liability.
Many insurers are becoming aware that
prevention strategies can make a com-
pany less risky to insure. As a
company's risk shrinks, some insurers
are willing to reduce premium costs or to
expand coverage. This is most common
with property insurance (due to reduced
risk of fire and explosion) and environ-
mental insurance.
Companies that prevent pollution and
save energy also protect their reputations
with the public. Some companies have
found that public reaction can be sting-
ing toward past waste disposal practices.
Even though they followed the law,
years later the waste caused damages
that were difficult and costly to clean up,
and harmed the company's public im-
age. On the other hand, the
public may react very
favorably to safer
raw materials
and more effi-
cient energy
use.
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Worker Safety
American businesses spend $170 billion
a year on costs associated with occupa-
tional injuries and illnesses — money
that comes straight out of company
profits.
Virtually any business stands to save
money, improve its working environ-
ment, and demonstrate its concern for
its employees by making improvements
to increase
worker safety.
Safety and
health-
management
systems
generally
work to prevent
pollution, since
poor materials management, waste
disposal practices, and worker exposures
contribute substantially to occupational
injuries and illnesses.
A small 50 person
plant saved $265,000
by establishing a strong
health and safety
program.
Did you know?
(D Average medical
claim costs a
business: $500 to
$1000
(D Average time loss
claim costs a
business: $15,000
to $45,000
(D 12,300 workers
suffered
occupational illness
in Washington state
in 2001 due to
exposures to toxics
and hazardous
substances
(D Over half of all
occupational
injuries happen
with new employees
(less than 3 months
with the company)
Companies that establish safety and
health management systems have seen
their injury and illness costs decrease by
as much as 40 percent. These businesses
also reap the benefits of reduced absen-
teeism, higher productivity,
and a better quality
product.
A Fortune Five company increased
productivity by 13 percent by establishing a
strong worker health and safety program.
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Competitiveness
When Boeing improved
its lighting efficiency,
it reduced energy
consumption and cut
annual operating costs
by $12 million. But it
also discovered an
unexpected benefit -
better quality products.
New lighting in one
building boosted the
defect detection rate
by 20 percent.
Think of a company you know. Is the
company an industry leader or just part
of the pack? Do other businesses have a
competitive edge over it?
Efficiency is the key to becoming and
staying competitive. Pollution prevention
eliminates inefficient processes that
generate waste. Identifying and reducing
this waste leads to efficient manufactur-
ing performance, which directly im-
proves product and service quality.
Consistent product quality is one of the
keys to customer loyalty. And customer
In 2000, Woodland Furniture
in Idaho Falls, Idaho, moved to a "lean
manufacturing" approach as an alternative to a
$7 million, 150,000 square foot expansion. Within
two years, the company reduced cycle-time by 89
percent, increased floor space productivity by 98
percent, and reduced work-in-progress by 83
percent. The CEO noted that the company
made its money back in the first 60
days of operation.
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By working with its suppliers to buy
recyclable and reusable products, Swedish
Medical Center has reduced its supply expenses from
23 percent to 17 percent of annual net revenue.
Pollution prevention is saving Swedish
$16 million a year.
loyalty has a major effect on a company's
revenue and profits.
Risk-averse lenders and investors are
increasingly looking at environmental
performance as an indicator of smart
management and competitiveness. This
includes the local banker, as well as the
Wall Street investor.
No matter how successful the company,
during economic downturns, businesses
must cut costs. Those that reduce their
energy, material, and disposal costs
may avoid layoffs and retain their
skilled workers. This is a boon when
business picks up again, because these
companies are profitable immediately.
Their competitors that lost skilled work-
ers spend more money hiring and training
new employees.
Research suggests
companies that
outperform
environmentally also
outperfom financially.
Many Wall Street
investors now equate
environmental
performance with
skilled management
and reduced risk to
investors.
Did you know?
Turnover costs
for one skilled
employee can be
more than
$30,000.
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Serve Public Interest
Mercury contamination
in the environment
harms brain
development in
children. One source is
junked cars, so Oregon
auto shops recently
offered free mercury
switch-outs for vehicle
trunk and hood Lights.
The public likes the
service, and one shop
reports increased
business as a result.
Reducing waste and preventing pollu-
tion benefits the public, as well as
business.
Clean air and water protect public
health, and safeguard our environ-
ment for future generations. Saving
energy lessens our nation's depen-
dence on foreign energy sources,
much of which comes from politically
volatile areas.
Fairchild Air Force Base in Washing-
ton has a strong energy efficiency
program, and has gone so far as to
make some of its own electricity on site.
The base plans to buy the rest of its
electricity from renewable sources. Not
only does this action reduce reliance on
imported oil, it is also consistent with
the military goal of improving national
energy security.
Post 9/11, security experts worry that
facilities with large stocks of toxic mate-
rials, and the systems used to move
The Alaska Materials Exchange catalog
allows businesses to list surplus materials or
goods for sale or trade instead of disposal. Close to
$2 million in materials have been exchanged
thro.ugh this program.
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these materials, could be potential tar-
gets of terrorist attack. Smaller stores of
less hazardous materials reduce this
vulnerability. Energy effi-
ciency can also reduce
the need to build
In May 2002, thieves broke
into a Washington food storage facility to
steal ammonia, a hazardous chemical commonly
used for manufacturing and refrigeration. It's also a
key ingredient in manufacturing the illegal drug
methamphetamine. In this incident, four people were
injured, and 1500 nearby residents had to be evacuated. In
2001 (the last year for which data is available), this type
of crime occurred 45 times in Washington. Companies
that use less hazardous substitutes, and secure and
lock their supplies protect their employees and
their communities, and help combat
the drug problem.
pipelines and
refineries
which are
vulnerable
parts of our
infrastruc-
ture.
Businesses
that prevent
pollution and
increase their
energy efficiency
save on their energy
bills, demonstrate their image as good
corporate citizens, make a patriotic
statement, and protect our national
heritage.
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Regulatory Relief
A Seattle-based metal
fabricator reduced its
air emissions, and
avoided having to file a
Title V Air Permit. The
average company
spends $64,000 to
apply for a Title V
permit.
Several years later, the
company went back and
found that in addition
to reduced air
emissions, it cut
hazardous waste
generation, and
normalized production
costs were over 10
percent less than before
the change. The local air
pollution authority
called the business a
"model company."
It's challenging and expensive to stay up
to date with rules and regulations. It
requires attention and staff time to stay
current on submitting all the required
forms and paperwork. Preventing pollu-
tion is a smart way to stay in compli-
ance, and to reduce or eliminate a
company's reporting requirements.
Using less hazardous raw materials can
often reduce regulatory exposure and
may eliminate the need for certain
permitting, manifesting, monitoring and/
or reporting requirements. Adopting
Environmental Management Systems
(EMSs) can help simplify reporting
duties, while also leading to increased
efficiencies and cost savings, better
public relations, increased employee
morale and reduced insurance rates.
Young Corporation, a Seattle
metal fabrication shop, cut the
volume of its waste over 90 percent by
installing new equipment. By reducing waste,
the company moved from a "large quantity
generator" to a "small quantity generator"
and dramatically simplified its reporting
and handling requirements.
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Don't Let Your Profits Go to Waste
Preventing pollution is simply good business - - companies come out
ahead by protecting the environment, their employees, and their
bottom line.
Contact us now for free personalized P2 assistance and referrals!
PPRC
Pacific Northwest
Pollution hwrniion Resource Center
Practical solutions
lor environmental
tind irmnnnii' vitality
office@pprc.org
www.pprc.org
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