Performance Track Third Annual Progress Report , -'ip . Growth^ RenewSf *1 National ^ Environmental f. PerformanceTrc U.S. Environmental Protection Agency SEPA United States Environmental Protection Agency ------- Location of Performance Track members ------- Table of Contents Executive Summary 1 Introduction 3 About Performance Track 4 Members' Commitments and Performance Improvements 8 Knvironmental Commitments 8 Knvironmental Performance Improvements 8 Member Achievements in 2003 10 Cumulative Achievements, 2000-2003 12 Charter Members' Achievements 12 Caveats to the 2003 Results 13 Member Services and Incentives 14 Public Recognition 14 Special Recognition Within Performance Track IS Corporate Leaders 15 Regulatory and Administrative Incentives 16 Networking and Learning Opportunities 18 Performance Track Partnerships 21 Partnerships with States 21 Partnerships with Other KPA Voluntary Programs 22 Performance Track Network Partners 23 The Performance Track Members' Survey 24 Conclusion 26 ------- ------- Executive Summary For the U.S. Environmental Protection Agency's National Environmental Performance Track program (Performance Track), 2004 was a year of growth, renewal, and the achievement of several important milestones: The program's charter members completed their first three-year term in the program, and more than 75 chose to renew their membership. Former KPA Administrator Mike I.eavitt signed the first Performance Track Rule, which provides regula- tory and administrative incentives to members. Administrator I.eavitt met with state officials in October, 2004 to discuss their support for Performance Track and other performance-based programs. The meeting led to a state-by- state survey by the Knvironmental Council of the States and an action plan to implement recom- mendations. Performance Track created a new Corporate Leader designa- tion to recognize companies that demonstrate an exceptional corporate-wide commitment to environmental stewardship and continuous improvement. Senior managers from KPA's Office of Water and Performance Track met in September with 25 Performance Track members to share ideas on incentives. Performance Track also worked with the Office of Water to develop incentives tied to the review of National Pollutant Discharge Klimination System permits, the Clean Water State Revolving Fund program, and the effluent guideline planning process. Three KPA regions developed Performance Track challenge commitments, specific goals that members may choose to adopt in order to help address regional envi- ronmental priorities. Performance Track members reported another year of outstand- ing results, with especially sig- nificant reductions in energy and water use, the generation of solid waste, and emissions of hazardous air pollutants. Kighty-six percent of members reported that they are satisfied with the level of recognition they have received from Performance Track. Performance Track worked with its trade association Network Partners to build interest in Performance Track through work- shops, articles in magazines, and coordinated communications. KPA signed an agreement with the American Chemistry Council and the Synthetic Organic Chemical .Manufacturers' Association to achieve closer collaboration between Performance Track and Responsible Care". The Performance Track Participants Association (PTPA), an independent association for members of the program, Performance Track Fast Facts The program currently has 351 members in 46 states and Puerto Rico To date, Performance Track members report that they have collectively reduced their water use by more than 1 3 billion gallons enough to meet the water needs of New York City's 8 million inhabitants for a day Members report that they have cut their generation of solid waste by nearly 600,000 tons, and have decreased their energy use by more than 8 4 trillion British Thermal Units (BTUs), enough to power more than 80,600 homes for a year In 2003 alone, Performance Track members report that they collectively reduced their energy use by 5 3 tril- lion BTUs, water use by 566 3 million gallons, and solid waste by nearly 300,000 tons held meetings and maintained ongoing communications with Administrator I.eavitt and head- quarters staff, KPA regional offices, and states to help build support for Performance Track. None of these accomplishments would have been possible without the partnerships that Performance Track has forged with members, states, industry groups, and PTPA, all of which are working hard to build the program's value to members and the environment. This year of growth and renewal for Performance Track has strengthened the program, added new incentives for facilities to go beyond compliance with environmen- tal laws, and set the stage for a suc- cessful future. 1 ------- ------- Introduction To the Maori of New Zealand, the curled emerg- ing frond of a tree fern symbolizes growth and renewal, new life rising in a perpetual cycle. The koru, as the unfurling frond is known, is an apt depic- tion of EPA's National Environmental Performance Track (Performance Track) program at the current stage of its development. At the end of 2003, Performance Track's charter members completed their first three- year term in the program, and more than 75 percent of them applied to renew their membership. Many of these facilities brought others with them to join the program for the first time. The first renewal season was an important milestone for Performance Track, as well as a litmus test. The decision of so many members to renew is a testament to the programs ability to attract and retain the nation's top environ- mental performers. It also speaks to member facilities' belief in the basic tenets of the program and to their faith that the program will continue to grow and flourish, providing new benefits and incentives to strengthen the business case for participation. To that end, KPA added a number of important new benefits for Performance Track members in 2004, including the signing of the first Performance Track Rule by Administrator I.eavitt in April and a notice of proposed rulemaking that would add regulatory and admin- istrative incentives for Performance Track members under the Resource Conservation and Recovery Act (RCRA). KPA estimates that the first Performance Track Rule will save eligible Performance Track members a total of more than $700,000 by 2007. The Agency also took new steps to encourage states to adopt Performance Track incentives, with positive results in a number of states. KPA signed Memoranda of Agreement with four additional states in 2004, for a total of nine, to coordinate Performance Track with state performance-based pro- grams and initiatives. The Agency also negotiated an agreement with the American Chemistry Council and the Synthetic Organic Chemical .Manufacturers Association to streamline the Performance Track application process for Responsible Care "-certified facilities. Performance Track created a new Corporate Leader designation to recognize companies that demon- strate an exceptional corporate-wide commitment to environmental stew- ardship and continuous improve- ment. The program also conducted its first survey of members to assess the value that they perceive from w The Performance Track program encourages companies to set their own environmental goals and stretch themselves to meet them. Performance Track promotes a more beneficial relationship with regulatory agencies, as it moves away from command- and-control measures and holds companies accountable for achieving their own targets." Shannon Cox Environmental Specialist Interface Fabrics Group 3 ------- Figure 1: Performance Track Environmental Performance Indicators Applicants to the program choose from among these indicators when setting their performance goals. See the description on page 5. upstream materials procurement recycled content hazardous components suppliers' environmental performance any relevant indicator from the inputs or nonproduct outputs stages inputs material use materials used hazardous materials used ozone-depleting substances used packaging materials used energy use non transportation energy use transportation _ ฆฆ energy use water use water used fi land and habitat Ljฃ land and habitat 8ฎ' conservation nonproducr ourpurs air emissions greenhouse gases VOCs NOx SOx PM-10 carbon monoxide air toxics odor radiation dust noise noise waste non-hazardous waste generation hazardous waste generation r^Tl ownstream products expected lifetime energy use expected lifetime water use expected lifetime waste (to air, water, land) from product use waste to air, water, land from disposal or recovery discharges to water chemical oxygen demand biological oxygen demand toxics suspended solids nutrients sediment from runoff pathogens acronyms VOCs = Volatile Organic Compounds f JO = nitrogen oxides SO = sulfur oxides PM-10 = particulate matter rhe program. Seventy-six percent of current members responded to rhe survey, providing valuable feedback that will help KPA focus irs efforrs on future benefits. About Performance Track Now in irs fifth year, Performance Truck recognizes and rewards facili- ties that consistently exceed regula- rory requirements, work closely with their communities, and excel in protecting rhe environment and public health. KPA provides exclusive regula- tory and administrative benefits to members, places them at low priority for routine inspections, and offers public recognition, network- ing opportunities, and other bene- fits. But Performance Track facilities do nor rest on their laurels: among rhe criteria for membership are a commitment to challenging envi- ronmental goals and a dedication to continuous improvement. Members report annually on progress toward their goals. This report presents rhe achieve- ments of Performance Track members for rhe year 2003, along with cumulative results since rhe programs inception in 2000 and final results from rhe charter members' first full three-year cycle. It also describes rhe programs new benefits, services, and incentives, including those announced during rhe first three months of 2005, along with key findings from rhe Performance Track member survey. 4 ------- Program Structure Performance Thick is operated by a core stuff in KPA's Office of Policy, Kconomics, and Innovation, and by Performance Track coordi- initors in each of the Agency's 10 regional offices. HPA staff work with state environmental agencies to review applications for the program, conduct site visits at member facili- ties, promote Performance Track and similar state performance-based pro- grams, and develop program policy. Membership Criteria Any facility, large or small, public or private, in the United States and its territories may apply for mem- bership in Performance Track. The program accepts applications twice per year, from February 1 to April 30, and from August 1 to October 3 1. An online application form is available at www.cpa.gov/pcrfor- mancctrack/apps/app.htm. To be eligible for membership, facilities must have: 1.A comprehensive, indepen- dently assessed Knvironmental Management System (K.V1S) 2. A record of sustained compliance with environmental laws 3. A commitment to continual envi- ronmental improvement 4. (/immunity outreach activities In meeting the third criterion, applicants commit to four quan- titative goals for improving their environmental performance. Small facilities commit to two goals. Applicants choose their commit- ments from among the indicators listed in Figure 1 (page 4), such as materials use, air emissions, or land conservation. Commitments can include upstream improvements, such as increasing the recycled content of purchased materials or improving the environmental performance of suppliers; improve- ments to inputs, such as decreasing the use of energy and water; reduc- tions in nonproduct outputs such as air emissions, waste, and dis- charges to water; and downstream improvements, such as decreasing the expected lifetime energy or water use of products. Kach facil- ity chooses its commitments based on its individual environmental impacts. In 2004, Performance Track instituted a "challenge commit- ment" policy to encourage members to address specific regional envi- ronmental priorities. Kach HPA region decides whether to create a Performance Track challenge com- mitment, which is made available only to facilities within that region. Challenge commitments count as two performance commitments; thus, members that adopt a chal- lenge commitment need only set three environmental performance commitments rather than four. To date, HPA Regions 1, 2, and 6 have set challenge commitments. Region 1 (Connecticut, Maine, .Massachusetts, New Hampshire, Rhode Island, and Vermont) chal- lenges New Kngland Performance Track facilities to commit to reduc- ing their energy use and associ- ated greenhouse gas emissions by 5 percent. Region 2 (New Jersey, New York, Puerto Rico, U.S. Virgin Islands) challenges members to reduce energy use or air emissions from mobile sources by 10 percent, or reduce air emissions from non- mobile sources by 20 percent. Region 6 (Arkansas, Louisiana, New Mexico, Oklahoma, Texas) has created an air emissions challenge commitment for facilities in ozone non-attainment areas, challeng- Environmental Management Systems An Environmental Management System (EMS) is a continual cycle of planning, implementing, reviewing and improving the processes and actions that an organization under- takes to meet its business and envi- ronmental goals EMSs are designed to identify, assess, and reduce facili- ties' environmental impacts Most EMSs are built on a "Plan, Do, Check, Act" model, which leads to continual improvement based on: Planning, including identifying environmental indicators and establishing goals, Implementing, including training and operational controls, Checking, including monitoring and corrective action, and Reviewing, including progress reviews and acting to make neces- sary changes to the EMS Facilities applying to Performance Track certify that they have adopted and implemented an EMS, and that it has undergone an independent assessment Details on the EMS criteria for Performance Track are available at www.epa.gov/perfor- mancetrack/program/ems.htm. 5 ------- Featured Facility U.S. Steel Clairton Works U.S. Steel Clairton Works of Clairton, Pennsylvania, employs 1 224 people and is the largest metallurgical coke plant in the country. Built in 1901, it was the first coke plant in the world Major products include blast furnace coke, coke oven gas, light oil, anhydrous ammonia, elemental sulfur, and crude coal tar Clairton Works was the first U S "smoke- stack" facility to become ISO 14001 certified When the facility joined Performance Track in 2001, it committed to reducing its steam use from 764,400 MMBtus to 752,400 MMBtus per year during its three-year membership period The facility reduced its steam use each year, and in 2003 showed a particularly impressive reduction from 728,532 to 664,100 MMBtus a level far beyond the facility's initial commitment The accomplishments in 2003 resulted from a series of efforts to identify opportunities to reduce steam use, followed by a variety of energy conseivation projects, such as repairing steam leaks One benefit of these reductions was that more of the coke oven gas produced at this facility can be used to replace the use of natural gas at sister plants in the area In 2004, the Clairton Works facility renewed its membership in Performance Track Between now and 2007, the facility intends to further reduce energy use by installing variable frequency drives and better metering systems ing facilities to make at least a 15 percent reduction of N()x or VOCs. Facilities are accepted into Performance Track for a three-year period, after which they may apply to renew their membership and select a new set of commitments. Reporting, Monitoring, and Site Visits For each year of their member- ship, Performance Track members submit an annual performance report documenting their results and major activities undertaken as part of their K.V1S. This report is due on April 1 for the preceding calendar year. KPA reviews each report to monitor performance and continued conformance with the programs criteria. In addition to monitoring perfor- mance through annual reports, KPA Performance Track staff and state officials visit a number of the pro- gram's member facilities each year. A site visit allows KPA to verify information presented in a facility's application, such as the quality of its K.V1S, and to review progress toward its performance commit- ments. KPA provides the facility with an assessment of its perfor- mance relative to other facilities in the program, and may suggest opportunities for improvements or partnerships with other firms and sources of technical expertise. The site visit also helps KPA and states establish a relationship with the facility's key environmental staff and top management, which may facili- tate discussions on ways to improve Performance Track and its benefits. Beginning in Kebruary, 2004, Performance Track established a cri- terion that all new applicants must have had an independent assessment of their K.V1S within the three-year period prior to the date of applica- tion. Because this criterion did not apply to existing Performance Track facilities, KPA focused the majority of its site visits in 2004 on facilities that had not had an independent assessment at the time of their appli- cation. KPA conducted site visits at 25 Performance Track facilities in 2004. Twenty-two of the visits were "traditional" site visits, focusing on whether the facility's K.V1S met the Performance Track criteria and how the facility was progressing on its performance commitments and public outreach activities. The remaining three facilities were visited for the purpose of testing a different direction in assessments, focused on evaluating data quality and whether the implementation of an K.V1S resulted in measurable improvements in environmental performance. As KPA becomes confident that the new independent assessment criterion provides assur- ance that applying facilities have a working K.V1S in place, the Agency will conduct more of these perfor- mance-based site visits and fewer traditional site visits. Of the 22 traditional visits con- ducted, only four facilities were ISO-certified (the International Organization for Standardization's environmental management stan- dard). Of the remaining IX facilities, half had self-assessed their K.VISs and half had a third party but not necessarily an independent one assess their K.VISs. KPA found areas for improvement at 10 of the IX non-ISO facilities, and these 10 facilities have agreed to implement these improvements. KPA asked two of the IX facilities to withdraw from the program due to severe deficiencies 6 ------- associated with their K.VlSs. Overall, the findings from KPA's 2004 site visits are once again consistent with previous years' results, in which the Agency found that most K.V1S issues were associated with non-ISO facili- ties or facilities whose K.V1S was not certified by a third party. This finding led to the implementation of the independent assessment requirement described above. Membership Profile Performance Track currently has 35 1 members in 46 states and Puerto Rico. Members represent vir- tually every manufacturing sector, as well as public-sector facilities at the federal, state, and local levels. By the end of February, 2005, Performance Track had reviewed nine rounds of applications, receiv- ing 601 applications and accepting 4X2. A total of 131 facilities have left the program since its inception. Facilities may be removed from Performance Track at their own request, for failing to continue to meet the program entry criteria, or for failing to submit a complete annual performance report. The most common reasons for leaving were KMS deficiencies found during site visits; facility closure, sale, or reorganization; and failure to submit Figure 2: Size of Performance Track Facilities than 7% 50 employees 50-99 employees Figure 3: Distribution of Performance Track Members Across Sectors S" Medical Equipment and Supplies and Entertainment an annual performance report. Some members also chose not to renew their membership upon comple- tion of their three-year membership term. In all cases, KPA encourages facilities to reapply to Performance Track when they are again able to meet the program criteria. 7 ------- Members' Commitments and Performance Improvements Performance Track members are at the forefront of innovation and environmental stewardship, fundamentally strengthening the relationship between business and government." Stephen L Johnson Acting Administrator, U S EPA Performance Track facilities have set challenging envi- ronmental commitments and achieved impressive results. Manv members ~ have managed to improve their performance well bevond the levels in their ~ commitments. Performance Track is a beyond- compliance program: improvements reported by members exceed those required by law. In addition, many members choose to reduce impacts in areas that are essentially unregu- lated, such as materials use, water use, energy use, habitat preserva- tion, and greenhouse gas emissions. One of Performance Tracks key environmental benefits is its ability to promote voluntary progress on these and other unregulated issues. Here we present the commitments of current members, environmental results reported for 2003, cumula- tive results for Performance Track since its inception, and the cumula- tive achievements of the program's charter members, who completed their first three-year term in the program during 2003. The results are based on members' annual per- formance reports for 2003, submit- ted to KPA in 2004 and available online at www.cpa.gov/pcrforman- cctrack/particip/indcx.htm. Environmental Commitments Performance Track members commit to at least four environmen- tal goals (two for small facilities) that they aim to meet within the three-year term of their membership in the program. Table 1 summa- rizes the commitments of facilities accepted into Performance Track by the end of 2004. Collectively these members have pledged to: Increase their use of recycled content in purchased materials by 137,493 tons; Reduce their use of hazardous materials by 20,46X tons; Reduce their water consumption by 4.16 billion gallons; Reduce their non-transportation energy use by 36.4 trillion British Thermal Units (BTUs); Kxpand the area of land set aside for conservation by 20,270 acres; Reduce their greenhouse gas emis- sions by 49,X66 metric tons of carbon dioxide equivalents; Reduce their total discharges to water by 22,X 19 tons; and Reduce their generation of haz- ardous and non-hazardous waste by 235,570 tons. Environmental Performance Improvements Kach year, Performance Track members submit a report on their environmental performance and other achievements during the previ- ous year. KPA reviews each report to monitor performance and continued conformity with Performance Track membership criteria. 8 ------- Table 1: Current Performance Track Members' Commitments Accepted Through 2004 Categories and Indicators Materials Procurement Recycled content Hazardous/toxic components Suppliers' Environmental Performance Packaging materials Hazardous materials Materials Use Hazardous materials Ozone-depleting substances Packaging materials Water Use Total water use Energy Use Non-transportation energy use Transportation energy use Land and Habitat Land and habitat conservation Air Emissions Greenhouse gases Volatile organic compounds Nitrogen oxides Sulfur oxides Particulate matter (PM-10) Carbon monoxide Air toxics Radiation Discharges to Water Biochemical oxygen demand (BOD) Chemical oxygen demand Total suspended solids Toxics Nutrients Sediment from runoff Waste Non-hazardous waste Hazardous waste Noise Noise Products Expected lifetime waste (to air, water, land) Number of Members With Goals* Upstream 44 5 1 1 Inputs 69 3 15 128 153 7 29 Nonproduct Outputs 28 46 21 13 7 2 17 1 7 2 7 9 4 1 191 121 Downstream Projected Annual Improvement by Year 3 of Membership 137,493 tons (increase) 79 tons 56 tons 0.28 tons 20,468 tons 33 tons 358 tons 4.16 billion gallons 36.4 million MMBTUs 90,241 gallons 20,270 acres (increase) 49,866 metric tons of CO2 equivalent 700 tons 2,406 tons 1,646 tons 88 tons 0.13 ton 293 tons 1,117 Curies 1,056 tons 7,444 tons 14,075 tons 130 tons 14 tons 100 tons 225,492 tons 10,078 tons 108 dBa** 751 tons *Values shown in this column represent the number of members whose goals for an indicator were included in the calculations for projected reductions Some goals were excluded from the calculations due to missing or nonstandard data **A-weighted decibels, an expression of the relative loudness of sounds in air as perceived by the human ear ------- Featured Facility Henkel Loctite Henkel Loctite in Olean, New York, manufactures electronic encapsulants, including molding powders, coating powders, and formulated liquids, such as urethane and epoxy systems Henkel Loctite is a recent recipient of the Good Neighbor Award for the Environment from the Greater Olean Area Chamber of Commerce This Performance Track member facility, which has 228 employees, is committed to dramatically reducing the amount of non- contact cooling water used in its production processes Since 2000, the facility has improved the water use efficiency of these processes by 61 percent Henkel Loctite achieved this result by installing closed-loop chiller systems on the process equipment and a cooling tower for the chiller systems Featured Facility Andersen Corporation Andersen Corporation of Bayport, Minnesota, employs about 3,500 people at this location to manufacture windows and patio doors One of its four commitments during its first three years as a Performance Track member was to reduce emissions of volatile organic compounds (VOCsi During calendar years 2001 through 2003, Andersen reduced its VOC emissions from 1,775 tons to 1,391 tons by improving the efficiency of its wood treating processes and by incorporating a slower evaporating solvent into its window paint line pretreatment process The facility plans to reduce its VOC emissions by at least another 200 tons during its next three-year commitment (2004 through 2006) through process improvements to solvent-borne preservative and coating operations Andersen continues to implement process improvement projects that align with the principles of lean manufacturing, including projects to increase transfer efficiencies in its paint line coating processes and alternative technologies and process improvements to reduce solvent-based wood preservation treatment In many cases, the results reported by Performance Track members tell only part of the story. Some member facilities have improved their "eco-efficiency" by reducing their environmental impacts per unit of production. When these facilities' production increases, they avoid impacts that otherwise would have occurred. For example, Performance Track facilities reported an absolute reduction in water use of 566.3 million gallons in 2003, but when improvements in eco-efficiency are taken into account, they actually avoided using more than 1.9 billion gallons of water. These avoidance figures are calculated by apply- ing a normalizing factor (taking into account changes in produc- tion) to the actual impact during the baseline year to estimate what the impact would have been in the reporting year without environmen- tal improvements. The reported actual environmental impact is then subtracted from this estimate, yielding the environmental impact avoided through the facility's envi- ronmental performance improve- ments. Please note that the tables in this section present only actual reported results, not normalized estimates. The summary below dis- cusses actual results except where indicated. The aggregated results of members' performance reports for the environmental indicators shown here may be strongly influenced by improvements or declines in perfor- mance at large Performance Track facilities such as a major reduc- tion or increase in energy use at a large, energy-intensive factory. Although FPA works closely with members to standardize their reporting, not all data submitted by members could be standardized before this report went to print. The tables and graphs in this section indicate how many commitments contributed to the results shown. Member Achievements in 2003 Performance Track facilities achieved outstanding results in 2003, especially for their reductions in energy use, water use, emissions of hazardous air pollutants, and solid waste. However, there was an overall increase in members' use of materials and hazardous materials in 2003, and an increase in certain discharges to water. Energy Use Performance Track members reported an overall 2.5 percent decrease in energy consumption between 2002 and 2003, saving more than 5.3 trillion BTUs. On a normalized basis, taking into account changes in facilities' production, Performance Track members avoided 14.X trillion BTUs of energy use in 2003, equivalent to the amount used by more than 140,000 average homes in a year. Water Use Members reported a 1.25 percent decrease in water use between 2002 and 2003, saving more than 566 million gallons of water. As with energy, the amount of water use avoided by improvements in eco-efficiency is much larger: on a normalized basis, members avoided using more than l.X billion gallons of water. 10 ------- Air Emissions Air emissions reported by Performance Track members decreased in 2003, with a 37 percent reduction in emissions of hazardous air pollutants (air toxics), a 16 percent reduction in volatile organic compounds (VOCs), a 14 percent decrease in nitrogen oxides (N()x), and a 12 percent reduction in sulfur oxides (S()x). Solid and Hazardous Wastes Performance Track members reported a 14 percent decrease in their generation of solid waste in 2003, a reduction of nearly 300,000 tons. Hazardous waste generation decreased by 1,763 tons, a 4.5 percent reduction. Land and Habitat Conservation Members preserved or restored an additional 3,3X6 acres of habitat in 2003, an area four times the size of New York City's Central Park. Materials Use In the aggregate, members showed an increase in materials use in 2003. This was due largely to a 42 percent increase in production at one large facility. Not surprisingly, that facil- ity showed an increase in materials use, but also showed an increase in materials efficiency. In fact, with production changes taken into account, members showed an aggre- gate improvement in their efficiency of materials use, avoiding 1,046 tons of materials use in 2003. 1 1 Table 2: Performance Track Members' Results for 2003 Indicator Improvements made in 20031 Units Number of results2 Energy use 5,327,423 MMBTUs 131 Water use 566,290,593 gallons 98 Materials use (26,01 If tons 47 Hazardous materials use (1,576) tons 47 Use of reused/ recycled materials 62,933 (increase) tons 46 Greenhouse gases 28,103 metric tons of CO2 equivalent 42 Volatile organic compounds (VOCs) 565 tons 48 Air toxics 175 tons 19 Nitrogen oxides (NOx) 1,746 tons 19 Ozone-depleting substances 11 tons 5 Particulate matter 55 tons 12 Sulfur oxides (SOx) 2,635 tons 8 Solid waste 295,815 tons 160 Hazardous waste 1,763 tons 103 Land & habitat conservation 3,386 (increase) acres 27 Discharges of BOD, COD, TSS, nutrients to water4 (13,932) tons 19 Discharges of toxics to Water (5,489) tons 12 Product packaging 163 tons 6 1 Represents the difference between 2002 and 2003 actual quantities 2 These numbers represent the number of commitment results included in the analysis, rather than the total number of commitments under the particular indicator Some members' results are not included in the analysis because their 2003 Annual Performance Reports were not completed by the cut-off date 3 Numbers in parentheses indicate an overall decline in performance 4 BOD=biochemical oxygen demand, COD=chemical oxygen demand, TSS=total suspended solids Hazardous Materials Use Hazardous materials use increased in 2003, despite the fact that more than half of the members with commitments to reduce their use of hazardous materials showed improvements in efficiency. The ------- Table 3: Performance Track Members' Cumulative Results, 2000-2003 Indicator Cumulative Reductions Units Number of Results1 Energy use 8,466,262 MMBTUs 131 Water use 1,341,708,688 gallons 98 Materials use 74,562 tons 47 Hazardous materials use 16,420 tons 47 Use of reused/ recycled materials 76,695 (increase) tons 46 Greenhouse gases Not available2 tons 42 Volatile organic compounds (VOCs) 1,017 tons 48 Air toxics 209 tons 19 Carbon monoxide 16 tons 2 Nitrogen oxides (NOx) 3,898 tons 19 Ozone-depleting substances 7 7 tons 5 Particulate matter 69 tons 12 Sulfur oxides (SOx) 16,257 tons 8 Solid waste 582,213 tons 160 Hazardous waste 8,321 tons 103 Land & habitat conservation 7,871 (increase) acres 27 Discharges of BOD, COD, TSS, nutrients to water4 (12,530)3 tons 19 Discharges of toxics to Water (1,345) tons 12 Product packaging 1,829 tons 6 1 These numbers represent the number of commitment results included in the analysis, rather than the total number of commitments under the particular indicator Some members' results are not included in the analysis because their 2003 Annual Performance Reports were not completed by the cut-off date 2 Cumulative results for greenhouse gases are not available due to a change in reporting after 2002 In 2001 and 2002, all members reported total tons of greenhouse gas emissions, after 2002 the program began a transition to reporting emissions in terms of CO2 equivalents 3 Numbers in parentheses indicate an overall decline in performance 4 BOD=biochemical oxygen demand, COD=chemical oxygen demand, TSS=total suspended solids result am he attributed almost com- pletely to three facilities that, despite very good overall performance records, showed some negative fluc- tuations in hazardous materials use in 2003. Discharges to Water The results of commitments to reduce discharges to water were dominated by a decline in per- formance at two large facilities. Discharges increased by 19,421 tons in 2003. Cumulative Achievements, 2000-2003 Since the inception of the program, Performance Track members have: Reduced their energy use by nearly X.5 trillion BTUs, enough to power X0.5 million homes for a year; Reduced their water use by more than 1.3 billion gallons, enough to meet all of New York City's water needs for a day; Reduced their generation of solid waste by nearly 600,000 tons; Reduced their generation of haz- ardous waste by X,32 1 tons; Reduced their use of materials by 74,562 tons; Reduced their use of hazardous materials by 16,420 tons; and Set aside 7,X71 acres of land for conservation, an area larger than 7,000 football fields. Charter Members' Achievements During Performance Track's first year, it accepted 253 facilities into the program. The results reported by these facilities, which completed their three-year term of membership in 2003, are presented here. These results represent the achievements of Performance Track's first complete membership cycle. Among these members' notable achievements were a reduction in energy use of more than 1 trillion 12 ------- BTUs enough to power nenrly 1 (),()()() households for a yenr and a reduction in water use of 1.9 billion gallons, enough to supply the water needs of more than 66,000 homes for a year. Caveats to the 2003 Results 1. Data arc self-reported by member facilities anil nor verified by FPA. 2. Although KPA asks for exact figures, some facilities appear to submit rounded data. 3. The baseline year for members that entered the program in Rounds 4 and 5 is 2001. Their results actually rep- resent changes occurring over a two- year period. 4. The avoidance figures in the summary of 2003 results are based on the normalizing factors calculated and provided by individual facilities. A facility's avoidance figures for 2003 were calculated by dividing the 2003 normalizing factor by the 2002 normalizing factor, multiplying that result by the 2002 performance level, and then calculating the dif- ference between that product and the actual 2003 results. Thus, the accuracy of the avoidance figures depends on both the accuracy of the reported actual results and the reported 2002 and 2003 normalizing factors. Normalizing is an inexact science. Normalizing factors often tell an incomplete story about changes in production in a facility, and they often fail to explain fully the causes of environmental pollution or resource consum prion. 5. Approximately 15 percent of member facilities' commitments relate to a spe- cific process rather than to the facility as a whole. For example, a facility may have committed to reducing its VOC emissions from a particular produc- tion line by 50 percent. The numbers reported in this document thus reflect the commitments made and the results relevant to those commitments. Therefore, it would be a misinterpreta- tion of the data to assume that a dem- onstrated improvement is, or could be projected to, represent the performance of entire facilities. (>. Similarly, facilities' commitments 13 Table 4: Performance Track Charter Members' Cumulative Results1 Indicator Cumulative Reductions Units Number of Results2 Energy use 1,038,815 MMBTUs 77 Water use 1,932,873,264 gallons 67 Materials use 65,137 tons 35 Hazardous materials use 1,015 tons 29 Use of reused/ recycled materials 147,255 (increase) tons 23 Greenhouse gases 39,337 tons 41 Volatile organic compounds (VOCs) 850 tons 33 Air toxics (2,418)3 tons 8 Nitrogen oxides (NOx) 2,030 tons 9 Particulate matter 36 tons 9 Solid waste 518,069 tons 95 Hazardous waste (157,958) tons 64 Land & habitat conservation 5,492 (increase) acres 20 Discharges of BOD, COD, TSS to water4 (2,041) tons 9 1 These figures reflect the cumulative results from charter members and the second round of applicants, 1 e , all facilities accepted in the first year of Performance Track 2 These numbers represent the number of charter member commitment results included in the analysis, rather than the total number of commitments under the particular indicator 3 Numbers in parentheses indicate an overall decline in performance 4 BOD=biochemical oxygen demand, COD=chemical oxygen demand, TSS=total suspended solids may relate to one "component" of an environmental indicator rather than to the indicator as a whole. For example, a facility may commit to reducing one particular waste stream or one particular toxic air emission rather than to reducing its total solid waste or all releases of toxic chemi- cals. The parameters of each facility's commitments may be determined by viewing its application and/or annual performance reports at www.cpa.gov7 performancetrack/particip. ------- Member Services and Incentives ; We have demonstrated that we are on a track toward continuous improvement and success in environmental performance. Joining Performance Track was another way of challenging us to continue those successes." Ken Gallant Environmental Supervisor International Paper-Bucksport EPA offers exclusive ben- efits to Performance Track members in three kev areas: ~ public recognition, regula- tory and administrative ~ incentives, and networking opportunities. The Agency added a number of new ben- efits in 2004, and continues to develop additional incen- tives to attract and retain facilities in the program. Public Recognition When KPA publicly recognizes a Performance Track facility for its out- standing environmental performance, the facility's reputation is enhanced among its regulators, peers, inves- tors, customers, employees, and local hornier hl'A Administrator Mike I .eavitt speaks about Performance Track at Hoorcr Dam, October, 2004. community. The Agency recognizes Performance Track members through a variety of means. Upon request, Hl'A notifies elected officials at the local, state, and national levels when it selects new members for participation in Performance Track. The Agency works with trade publications, Performance Track Network Partners, and local media to place articles about members and the program. In 2004, X 1 publications carried articles about Performance Track, reaching a circulation of more than 2 million people. Facilities admitted to the program are recognized by senior Hl'A officials at the Performance Track Annual Members' Hvent, and they receive a framed certificate of membership suitable for display. Performance Track members may use and display the Performance Track logo. The program's Member Services site provides art files for hardhat stickers, fleet signage, and a flag. Some facilities have produced caps, shirts, and other items using the logo. Members are listed on the Performance Track website (vvvvvv. cpa.gov/pcrformancctrack), which has received more than 2 million visits since it was launched in 2000. Several leading social investment advisory firms, including Calvert (iroup, Innovest Strategic Value Advisors, and KI.I) Research and Analytics, include membership in Performance Track among 14 ------- the factors they consider in their rating analysis of companies. KPA also distributes Performance Track press releases via CSRwire, a globally syndicated social responsibility news service. Special Recognition Within Performance Track Performance Track members that achieve particularly outstanding results or make exceptional efforts to promote the program may be eli- gible for special recognition. The Performance Track Environmental Performance Award recognizes members that have dem- onstrated exemplary environmental performance during their participa- tion in the program. The Performance Track Outreach Award recognizes current members that make a special effort to inform the public about what it means to be a member of the Performance Track program. The Performance Track Director's Award recognizes members that the director has selected for out- standing achievements in any one of several areas, including mentor- ing, recruiting, public outreach, and community leadership. Corporate Leaders In 2004, Performance Track added the Performance Track Corporate Leader designation to recognize companies that have multiple facili- ties in Performance Track and that demonstrate an exceptional corpo- rate-wide commitment to environ- mental stewardship and continuous improvement. KPA will designate a select number of Performance Track Corporate Leaders each year for a five-year membership. Performance Track Corporate Leaders meet all of the following criteria: At least five of the company's facilities are members of Performance Track; The company's facilities that are enrolled in Performance Track and/or in similar state perfor- mance-based programs represent at least 25 percent of its U.S. operations, based on the number of facilities or employees (alterna- tively, the company has at least 25 facilities in Performance Track); The company commits to increas- ing its level of Performance Track membership to at least 50 percent of its U.S. operations within five years of designation (alternatively, the company commits to having at least 50 of its facilities enrolled in Performance Track and/or similar state programs within that period). The company makes environ- mental issues a priority at the corporate level and uses a system to identify, prioritize, manage, measure, review, and continuously improve environmental perfor- mance throughout operations; The company demonstrates a strong compliance record with environmental regulations; and The company commits to improve its environmental performance and that of its suppliers and/or customers. The first three Performance Track Corporate Leaders, selected by KPA and announced in early 2005, are Baxter Healthcare, Johnson & Johnson, and Rockwell Collins. Lor more information, see wvvw.cpa. gov/pcrformancctrack/corporatc- lcadcrs/ Performance Track Award Winners, 2004-2005 Environmental Performance Awards 2004 Baxter Healthcare, Inc., Guayama, Puerto Rico Pfizer, Inc., Lititz, Pennsylvania Bridgestone/Firestone South Carolina, Graniteville, South Carolina The City of Scottsdale, Scottsdale, Arizona 2005 Durango-McKinley Paper Company, Prewitt, New Mexico Ideal Jacobs Corporation, Maplewood, New Jersey Rohm and Haas - La Mirada Plant, La Mirada, California 3M Nevada, Nevada, Missouri Director's Award for Mentoring, 2004 New Hampshire Ball Bearings, Inc., Peterborough, New Hampshire Director's Award for Corporate Outreach, 2005 3M Corporation, St. Paul, Minnesota Outreach Awards 2004 American Ref-Fuel Company of Hempstead, Westbury, New York DuPont-Spruance Plant, Richmond, Virginia Pfizer, Inc.-Lincoln Operations, Lincoln, Nebraska Texas Instruments-Sensors and Controls, Attleboro, Massachusetts 2005 International Paper, Franklin, Virginia Motorola GTSS Ocotillo, Chandler, Arizona Pfizer, Inc., Terre Haute, Indiana 3M ESPE Dental Products, Irvine, California Special Commendation for Outstanding Achievement in Enviromental Management and Wildlife Habitat Restoration, 2004 Monsanto Company, Monsanto, Iowa (conferred jointly by Performance Track and the Wildlife Habitat Council) 15 ------- Performance Track Corporate Leaders Baxter Healthcare Corporation, a global medical devices, pharmaceu- ticals, and biotechnology company, has eight of its 16 major facilities and two smaller facilities in Performance Track Among Baxter's future com- mitments as a Corporate Leader are further reductions in energy use, further reductions in solid waste, and increasing the number of its key suppliers participating in EPA's Green Suppliers Network Johnson & Johnson is a healthcare products and services company More than three-quarters of its 46 major facilities and 15 of its smaller ones are members of Performance Track As a Corporate Leader, J&J has pledged to further reduce its greenhouse gas emissions and water use, and increase its use of paper packaging derived from sustainably managed forests or with recycled content Rockwell Collins provides design, production, and support of com- munications and aviation electronics Eight of its 14 major facilities and two of its smaller ones are Perfor- mance Track members Among its commitments as a Performance Track Corporate Leader are a pledge to purchase 10,000 Megawatt-hours of renewable energy certificates per year, improving the environmental performance of key suppliers, and reducing its purchase of chemicals State Support for the Performance Track Rule Eleven states report that they have adopted the Resource Conservation and Recovery Act (RCRA) provisions of the first Performance Track Rule, including Colorado, Florida, Georgia, Idaho (adopted but not yet final- ized), Maryland, New Jersey, North Carolina, Pennsylvania, Tennessee, Virginia, and Washington The rule also is available in states or territories where EPA administers the RCRA program, including Alaska, Iowa, and Puerto Rico Regulatory and Administrative Incentives Performance Track members' history of strong compliance, com- mitment to measurable improvement, and effectiveness in environmental management set them apart from other facilities. Accordingly, KPA believes they should be eligible for exclusive regulatory and adminis- trative benefits. These benefits help Performance Track facilities focus on continuous improvement by reducing some of the routine administrative costs of regulation, and by allowing them additional procedural flexibility in certain cases. Performance Track regulatory and administrative incen- tives can also help regulatory agencies focus their assistance, inspection, and enforcement resources on higher pri- orities, such as facilities that require closer oversight. Developing and Institutionalizing Incentives KPA's general approach to devel- oping regulatory and administrative incentives for Performance Track is to focus first on policy or adminis- trative changes and then regulations. Within these broad categories, the Agency works to develop innova- tive incentives that are available to Performance Track members; that reduce burden, increase flexibility, and streamline and expedite pro- cesses; and that will be applicable widely among existing and likely future member facilities. The process to develop, propose, and finalize changes in a federal regulatory program typically takes at least two years. Once finalized, each state must first adopt the changes and then reapply for autho- rization to implement the regulatory program. This stage of development varies across states and according to the media covered by the regulation, such as air or water. States are not required to adopt federal regulations for Performance Track because it is a voluntary program. Progress on Incentives in 2004 KPA has made considerable progress during the past year to advance Performance Tracks ability to deliver quality incentives to members. On Karth Day, 2004, former KPA Administrator Mike I.eavitt signed the first Performance Track Rule. This rule provides ben- efits to eligible Performance Track facilities under the Clean Air Act and the Resource Conservation and Recovery Act (RCRA), described in the air and waste sections below under "Current Regulatory and Administrative Incentives." Within the Agency, Performance Track staff have continued to develop relationships with KPA's program offices. In September, senior managers from the Office of Water and Performance Track met with 25 Performance Track members to share ideas on incen- tives and discuss key water program issues. Performance Track also worked with the Office of Water to develop incentives tied to the Clean Water State Revolving Kund program and the effluent guideline planning process. Performance Track staff interact with regulatory officials at KPA headquarters and regional offices to help spread implementation of the first Performance Track Rule, and program staff participate fre- quently in conference calls among 16 ------- (ieoff (irubbs, director of h.l'A's (office of Science and Technology, addresses Performance Track's September, 2004 meeting with the Office of Water. RCRA permit writers and regional air toxics coordinators to provide regular updates and encourage them to consider incentives for members. Finally, Performance Track and other KPA staff have been working externally with key organiza- tions, such as the Knvironmental Council of States (HCC)S), the Association of State and Territorial Solid Waste Management Officials, the Association of State and Interstate Water Pollution Control Administrators, and the Performance Track Participants' Association to build support for Performance Track incentives at the state and local level. Current Regulatory and Administrative Incentives Low priority for routine inspections Since the beginning of the Performance Track program, KPA has placed members at a low pri- ority for routine inspections. This benefit has been successfully imple- mented at the federal level in each of KPA's 10 regions. Twelve states have adopted this policy to date, and the Agency continues to encour- age broader state support for this important benefit of membership in Performance Track. Air incentives The first Performance Track Rule reduces the frequency of reports required under the Maximum Available Control Technology (MACT) provisions of the Clean Air Act such that semi-annual reports may be submitted annually, and in certain cases members may submit an annual certification for these require- ments in lieu of an annual report. Performance Track has made progress on developing new air incentives since last year's report. At that point KPA was developing flex- ible permits for major air sources. These permits typically include provisions that approve in advance process changes that would other- wise require major permit modifica- tions. These types of permits have been found to save facilities and states substantial time and money over the life of the permit, and lead to more significant reductions in air emissions. Klexible permits are cur- rently in the final stages of develop- ment at three Performance Track facilities, and will be available for public review and comment in the spring of 2005. Waste incentives Under the first Performance Track Rule, KPA allows Performance Track members that are large- quantity generators of hazardous waste up to 1X0 days (instead of the normal 90 days) to accumulate their hazardous waste without a RCRA permit or interim status. Spotlight on Performance Award Recipients, 2004 Baxter Healthcare Corporation's facility in Guayama, Puerto Rico, reduced its hazardous waste by 195,000 pounds in its first two years of membership, along with reducing its energy use by 57,000 MMBTUs It also reduced its generation of solid waste by 62 percent and its biologi- cal oxygen demand (BOD) discharges to water by 95 percent Pfizer Global Manufacturing in Lititz, Pennsylvania, reduced its total solid waste by 820 tons and its hazard- ous waste by 780 tons during its first two years in Performance Track It reduced its total energy use by more than 3 6 million kilowatt-hours, and cut BOD discharges to water by 82,000 pounds Bridgestone-Firestone South Caro- lina, in Graniteville, South Carolina, avoided the generation of 22 million pounds of solid waste over two years and improved its energy use effi- ciency by 19 percent The City of Scottsdale, Arizona, reduced its total energy use by more than 300,000 kilowatt-hours and its emissions of volatile organic compounds by nearly 6,000 pounds The city also reduced its generation of solid waste by 4,188 tons, a 31 percent improvement 17 ------- EPA Acting Administrator Stephen Johnson praised the tremendous accomplishments of Performance Track members during the 2004 Annual Members' Event in Baltimore. Water incentives As a followup to the September, 2004 meeting with KPA's Office of Water and Performance Truck members, Performance Truck stuff worked with the Office of Water to develop a process to expedite the review of National Pollutant Discharge Hlimination System (NPDHS) permits held by Performance Track members. This process will be finali/ed in 2005. In 2004, KPA began encourag- ing states to provide more favor- able terms to Performance Track facilities in their Clean Water State Revolving Fund (CWSRF) pro- grams. CWSRh" programs provide loans for a variety of water quality projects, including municipal wastewater treatment projects, as well as nonpoint sources, water- shed protection or restoration, and estuary management. The CWSRF loans can help Performance Track facilities achieve environmental commitments that are important to state and local environmental priorities. The support also could encourage facilities to increase their community involvement, perhaps linking facilities with watershed groups. Working with Performance Track facilities also allows states to support activities that are beyond regulatory requirements. More information is available in HPA's CWSRt- fact sheet at vvvvvv.cpa.gov/ ovvm/cvvfinancc/cvvsrf/pcrformancc- track.pdf. Finally, in its analyses to deter- mine whether to develop or revise effluent guidelines for various indus- try sectors, the Office of Water con- siders the sectors' voluntary efforts to reduce water pollution, such as facility improvements through pro- grams like Performance Track. Looking Ahead KPA is developing a new Performance Track rule for RCRA and expects to propose it in 2005. The Agency is also expected to final- ize a new RCRA Burden Reduction Rule that contains several provisions available exclusively to Performance Track facilities. In addition, KPA has proposed a hazardous air pollutants rule that provides compliance alter- natives under \1A(T with special provisions for Performance Track members. Performance Track's work with the KPA Office of Water has moved forward with developments in expe- dited permitting, and KPA expects further developments in the coming year. In addition, Performance Track is working closely with the Air Office to develop more incentives for members, and to develop a rule for flexible air permitting. Networking and Learning Opportunities Performance Track offers valu- able opportunities for its members to learn from each other and share best environmental practices. The program also offers opportunities for members to meet KPA officials from national headquarters and regional offices. Annual Members' Event Kach year, Performance Track members and KPA officials gather for award ceremonies, panel dis- cussions, and breakout sessions on topics important to Performance Track facilities and partners. This meeting is an excellent opportu- nity for members to meet KPA Performance Track staff, network 18 ------- with their colleagues, learn about program developments, and share their experiences. Regional meetings Kach of KPA's 10 regional offices holds periodic meetings for Performance Track members in its region. Some regions also have hosted recruitment workshops for facilities interested in learning more about the program, and several regions have organized special events to recognize top environmen- tal performers. Teleseminars All Performance Track members are invited to attend bimonthly seminars, conducted by conference call, on timely and relevant topics. In 2004, teleseminars were held on topics such as intangible drivers that link environment, health, and safety performance to shareholder value; efforts by Performance Track members to work on watershed issues; and an information session on the Chicago Climate Hxchange. Past teleseminars have focused on such topics as lean manufacturing, the business case for including a wildlife habitat commitment under Performance Track, community involvement strategies, and flexible permitting. Online Newsletter P-Track News is a bimonthly newsletter that keeps Performance Track members informed of new program developments, member achievements, news from the KPA regions, a calendar of upcoming events, and other information of interest to members. Performance Track members in h.l'A Region .? received certificates in October, 2004 for renewing their membership in the program. Left to right: Marie Holman, U.S. h.l'A Region .? Performance Track C.oordmator; C.harles Sanders, Pfizer (ilobal Maniifaeturing; Tom Murphy, Montenay Energy Re'Soiirce'S of Montgomery ('ฆ(>.; C.olle'e Daris, U.S. Ste'el C.lairton Works; Joe l.oschiaro, Dnl'ont Spruance; I'hil Dahhn, Johnson 6y Johnson, McNeil C.onstimer & Specialty Pharmaceuticals. Resource Center and. Case Studies Performance Tracks website provides a Resource Center to help existing and prospective members learn more about Knvironmental \lanagement Systems, Performance Tracks environmental improvement categories, industry-specific envi- ronmental performance resources, and more. The Resource Center also provides case studies highlighting the achievements of selected Performance Track members. The Performance Track Member Services site includes a series of Innovative Practices Spotlight articles that describe par- ticularly innovative approaches that Performance Track members have developed to address environmental challenges. The Resource Center is available at: www.cpa.gov/pcrfor- mancctrack/tools/indcx.htm. Spotlight on Performance Award Recipients, 2005 Durango-McKinley Paper Company, in Prewitt, New Mexico, exceeded its materials use reduction goal by 1,000 tons and showed a 20 percent improvement in materials efficiency during its first three years of mem- bership in Performance Track It reduced its water use by 2 million gallons per year and its landfill waste by more than 3,200 tons Ideal Jacobs Corporation, in Maple- wood, New Jersey, reduced its solid waste to a mere 6 percent of its 2001 levels in part by directly linking waste amounts to employees' salaries and responsibilities Rohm and Haas's plant in La Mirada, California, decreased its annual energy use by nearly 10,000 MMBTUs and its generation of hazardous waste by more than 10 tons It also improved its water use efficiency by 7 percent in 2002 and 8 percent in 2003 3M Nevada, in Nevada, Missouri, has reduced its energy use by nearly 50,000 MMBTUs, and cut its emis- sions of volatile organic compounds and toxic emissions by 57 percent ------- Featured Facility Arizona Chemical Arizona Chemical of Pensacola, Florida, a facility with 43 employees, manufactures terpene-phenolic and polyterpene resins that are used in hot-melt adhesives, box-sealing adhesives, book bindings, chewing gum, and inks and coatings This facility committed to reduce its toxic air emissions of xylene and ethylbenzene By the end of its first year of participation in Performance Track, the facility had reduced its emissions of these two chemicals from 19,334 pounds to 9,258 pounds Reductions projects included tying in emissions from the distillation column to an existing vapor condenser, modifying the vent header, and installing equipment to remove toxics from wastewater, thus reducing air emissions from wastewater trenches and process sewers Performance Track Participants' Association Performance Track members have formed a private, indepen- dent membership association that provides a forum for members of the program. Performance Track Participants'' Association (PTPA) members exchange information and benchmark best practices with each other, work closely with KPA in the development and implementation of Performance Track incentives, educate and inform the public and other stakeholders of the work being done by Performance Track members, and work toward educat- ing and informing policy makers of the important role that Performance Track plays in improving the envi- ronment. PTPA organized the 2004 Annual Members' Kvent in coopera- tion with KPA, and has held meetings and maintained communications with the KPA Administrator and head- quarters staff, KPA regional offices, and states to help build support for Performance Track. Kor more infor- mation, visit the association's website at vvvvvv.ptpaonlinc.org. 20 ------- Performance Track Partnerships EPA partners with states, trade associations, and other public- and private-sector organizations to promote Performance Track and col- laborate with other perfor- mance-based programs. Partnerships with States KPA and suite governments ;ire partners in implementing Performance Truck and delivering benefits to member facilities. KPA works with the states to advance the principle that high-performing facilities should be recognized and rewarded for their accomplishments by enabling them to focus more on environmental progress than on process. Performance Track comple- ments and builds on the successful environmental performance pro- grams launched by the programs state partners. Some of these pro- grams were established prior to Performance Tracks inception and served as models for the national program, which in turn helped to spur the development of additional state programs. Although some state programs are rooted in K.VISs and others in pollution prevention, they all support environmental perfor- mance that goes beyond compliance. KPA and the states believe they can achieve more by working together than by pursuing their goals inde- pendently. Therefore, representatives of KPA and state agencies are in frequent contact as they coordinate the development and implementa- tion of their programs. KPA consults with states on policy issues such as member implementation of K.VISs. States participate in site visits to Performance Track facilities, as well as in Performance Track member events at the national and regional levels. KPA considers state input crucial to its decisions on facilities applying to Performance Track. To further facilitate this partner- ship, each year KPA organizes a conference for state and regional officials to discuss topics that are important to their varied, but aligned, performance-based programs. Sessions range from brainstorming the development of new incentives to presentations by program members, with a focus on providing an opportunity for par- ticipants to benefit from problem- solving discussions and exposure to state-of-the art approaches to mea- suring performance. Progress in 2004 In some respects, the most sig- nificant work between KPA and the states has taken place during the past year. On October 4, 2004, former KPA Administrator Mike I.eavitt hosted a discussion at the Knvironmental Council of States (KCOS) 2004 fall meeting in Oklahoma City. The Administrator invited senior managers from strong partner states as well as from KPA Headquarters and regional offices. I.eavitt and state officials discussed the value of performance-based pro- grams and the elements of these pro- " Before we started in Performance Track, we'd reached a plateau in our environmental improvement at some of our plant locations. Now we're leveraging Performance Track to help us with further improvements in reducing our environmental footprint." Sara Ethier Director, Environmental Operations 3M 21 ------- Featured Facility Johnson & Johnson Pharmaceutical Research and Development Johnson & Johnson Pharmaceutical Research & Development, LLC of Spring House, Pennsylvania, is a campus of 1,100 employees conducting research and development from laboratory-scale drug discovery to pilot-scale chemical development Between 2000 and 2003, the facility reduced its annual solid waste by eight tons, despite a 22 percent growth in the number of employees, by making changes to its animal caging system, capturing waste from overspray powders and enzyme bead, and reselling it for reuse by an off-site third party, and implementing Design for the Environment principles, a systematic process to identify and minimize the environmental impacts of products and processes across their entire life cycle When this facility renewed its membership in 2003, it committed to making further reductions in waste generation and other improvements in waste management practices grams rhar are important to future success. He then asked the states to advise him if they were interested in engaging in the necessary steps to support and meaningfully expand these leadership programs. In response to this challenge, rep- resentatives from KCOS conducted a nationwide survey, polling states on their support for Performance Track and state performance-based programs. With responses from 4 1 of the 50 states, KCOS was able to formulate goals and objectives for the coming year. The results showed that many states are interested in perfor- mance-based leadership programs and in learning how to improve them. Another aspect of the KCOS research included a meeting of officials from KCOS, KPA, and the Performance Track Participants'' Association to obtain input from the perspective of perfor- mance-based program members. Participants in this meeting agreed to continue to work together to identify and target new states in the effort to expand the reach of performance-based programs. On January 13, 2005, KCOS issued its final report, which focused on recommendations for improving the effectiveness of performance- based environmental programs. The report made several specific recommendations: 1) to support state programs and state efforts to work with Performance Track; 2) to assure program support from all KPA program offices; 3) to provide incentives to participants faster; and 4) to conduct more strategic mar- keting and education to promote the programs. These recommendations have been transformed into action plans that will be addressed by senior KPA management and KCOS representatives, with participation by members of Performance Track and state programs. This group will work toward meeting the action plans' goals during 2005. Agreements With States States that wish to maximize the coordination of their performance- based incentive programs with Performance Track may enter into a \lemorandum of Agreement (\1()A) with KPA. To date, KPA has signed \l()As with nine states: Colorado, (ieorgia, Maine, Massachusetts, Tennessee, Texas, Utah, Virginia, and Washington. KPA is currently working to develop agreements with several other states. These MOAs provide a framework for joint recruitment, admissions, and delivery of incentives to program members. Through KPA's MOA with Texas, for example, Texas and KPA have worked together on a plan to integrate their performance- based programs. That plan has been implemented on an incremental basis throughout 2004. KPA and the states continue to work together to enhance perfor- mance-based programs and reward program members for their leader- ship in environmental protection. Kach step forward serves to affirm the growing strength of the federal- state partnership the benefits of which will be reaped by the American public and the environment. Partnerships with Other EPA Voluntary Programs Many other KPA voluntary pro- grams share Performance Tracks goal of achieving continuous envi- ronmental improvement. The Sector Strategies program works closely with 12 industry sectors to promote the use of KMSs, overcome regula- tory and other barriers to environ- mental improvement, and improve the ability to measure performance. 22 ------- Released in June 2004, the Sector Strategies Performance Report docu- ments the environmental results that are being achieved in each of these 12 sectors. This report can he found online at vvvvvv.cpa.gov/scctors/ pcrformancc.html. Several current members of Performance Track among them Chicago White Metal, Bath Iron Works, Baker Petrolite, and the Port of Houston built their qualifications for Performance Track by participating in the Sector Strategies program. Members also are finding value in linking their Performance Track efforts with other KPA voluntary pro- grams. For example, the Corporate Leaders are expanding their involve- ment in KPA's (ireen Suppliers Network, as a way to influence the environmental performance of their supply chain. Many members also are linking their participation in pro- grams such as Climate Leaders and the Resource Conservation Challenge with Performance Track. More infor- mation on the wide range of KPA voluntary programs is available at vvvvvv.cpa.gov/partncrs/programs/. Performance Track Network Partners Performance Track Network Partners are national trade associa- tions, non-governmental organiza- tions, and professional organizations that work in partnership with Performance Track to promote the program and its benefits. There are currently 22 partners in the program. KPA recognizes partners by acknowledging their efforts in pub- lications and at Performance Track events. The Agency provides part- ners with materials to assist them in marketing Performance Track, and KPA representatives may be avail- able to speak about Performance Track at partners' conferences and meetings. If a partner has its own voluntary environmental per- formance initiative, KPA works with the partner to identify simi- larities to Performance Track and potential opportunities for further collaboration. The Agency peri- odically arranges opportunities for roundtables and other information exchanges involving network part- ners, agency decision makers, and KPA subject matter experts. In June, 2004, KPA signed a \lemorandum of Agreement with two network partners, the American Chemistry Council (ACC) and the Synthetic Organic Chemical .Manufacturers Association (SOCMA), to achieve closer collabo- ration between Performance Track and Responsible Care". The new agreement will streamline the KMS component of the Performance Track application process for Responsible Care-certified facilities, including members of ACC, SOCMA, and ACC Responsible Care Partners. KPA also will coordinate with ACC and SOCMA on the scheduling of site visits to Responsible Care/ Performance Track facilities, minimiz- ing disruption by combining the two programs' site visits and audits wher- ever possible. In addition, KPA, ACC, and SOCMA will collaborate to share lessons and ideas on performance measurement between Performance Track and Responsible Care to increase awareness of Performance Track within the chemical industry. In November, 2004, Performance Track and another network partner, the Wildlife Habitat Council (WHC), held a joint technical workshop at WHC's 16th Annual Symposium in Baltimore, \laryland. During the workshop, KPA and WHC recog- nized a number of companies and facilities for their participation in both Performance Track and WHC. The Performance Track Network Partners Academy of Certified Hazardous Materials Managers American Chemistry Council American Furniture Manufacturers Association The Associated General Contractors of America The Auditing Roundtable Cement Kiln Recycling Coalition Global Environmental & Technology Foundation & Public Entity EMS Resource Center Greening of Industry Network International Carwash Association National Association of Chemical Distributors National Defense Industrial Association National Paint and Coatings Association National Pollution Prevention Roundtable National Ready Mixed Concrete Association National Stone, Sand, and Gravel Association NORA, an Association of Responsible Recyclers North American Die Casting Association Screenprinting & Graphic Imaging Association International Steel Manufacturers Association Synthetic Organic Chemical Manufacturers Association Voluntary Protection Program Participants' Association Wildlife Habitat Council facilities received a joint certificate of recognition for their commitment to outstanding environmental perfor- mance and wildlife habitat enhance- ment and restoration. Performance Track and WHC also conferred a special commendation to Monsanto Company's facility in Muscatine, Iowa, for its outstanding achieve- ments in environmental management and wildlife habitat restoration. 23 ------- The Performance Track Members' Survey " The Performance Track program makes sense from a business perspective. Not only in terms of costs vs. benefits, but also from a general public perception standpoint, by improving your image within your local community." Leah Wood Environmental Counsel Associated General Contractors of America During the summer of 2004, Performance Track con- ducted an online survev to ~ determine how members value the services provided by the program. Seventy- six percent of current Performance Track members responded to the survey, pro- viding valuable information that will help EPA determine the future benefits offered to members. Eighty-six percent of respondents reported that thev are satisfied with the ~ recognition they receive from Performance Track. The survey produced the following key findings: The most important reason members join and stay in Performance Track is the oppor- tunity for a collaborative relation- ship with KPA and the states. Members want state buy-in of Performance Track. Members want to publicize their Performance Track membership to the local community and local regulatory agencies. Although regulatory incentives are not the primary reason for joining or continuing in Performance Track, members want to see the regulatory incentives expanded. Members are aware of, and in general find useful, the services offered by Performance Track. Performance Track staff created a workgroup to develop an action plan that would address the surveys findings. The actions are organized around cultivating more collabora- tive relationships, encouraging state support of the program, increasing community outreach, and continu- ing to expand incentives. Among the action items in the plan are: Hold meetings on Performance Track incentives with each KPA program office and conduct follow-up; Develop new case studies that show how Performance Track contributes to environmental pro- tection goals; Better publicize online tools for member community outreach; and Set up meetings with regional admin- istrators and state commissioners to discuss Performance Track. KPA staff have begun to work on a number of the goals and will continue to work toward achiev- ing all goals in order to improve the program for each member. The action plan is available online at vvvvvv.cpa. gov/pcrformancctrack/downloads/ survcy_action_plan.pdf. 24 ------- Figure 4: Top-ranked motivating factors in facilities' decision to join Performance Track Collaborative relationship v/ith EPA and states Improved reputation from public av/areness Opportunities to improve environmental performance Recognition from EPA Potential for regulatory incentives Lov/ priority for routine inspections Netv/orking v/ith top environmental performers 0% 20% 40% 60% 80% I most important second-most important third-most important Figure 5: Survey respondents' ranking of benefits that Performance Track might provide to better complement their business goals or mission w The best thing about Performance Track is that it's truly a partnership between businesses and EPA; it's a great approach to address common environmental issues." Steve Green Environmental Manager Nucor Steel Auburn, Inc MP 9% learning opportunities 6% miscellaneous 5% financial iri' 'jntives /% inreach 5% networking between members 4% program policies/ reporting 3% other services from EPA Figure 6: Survey respondents' recommendations for ways Performance Track could improve the recognition members receive 1 1 ()/ 1 0"/<) oo/ I I /<> EPA promotional r__i' general media products/events general S'Zo ป-ปiiPPซp . 1^ซ.ป!ปf.ซiitiers/ chain 3% EPA inreach/ awareness I'**1* *ซซ,al government state awareness or awareness Performance Track 25 ------- Conclusion "As aggressive and proactive stewards of the environment, we are honored to be a part of the program. That's why we added the Performance Track logo to our company letterhead." Rex Query Vice President and General Manager Nucor Steel With the successful comple- tion of its first three-vear ~ membership period and its first renewal season, Performance Track has passed an important mile- stone in its growth and development. By renewing their membership, more than three-quarters of Performance Track's charter facilities demonstrated that they value the recognition and other benefits thev ~ receive from the program. At the same time, EPA and its partners worked hard to strengthen the business case for membership in Performance Track bv devel- ~ oping new incentives and encouraging broader support of Performance Track incen- tives bv states. ~ The member survey conducted during the summer of 2004 pro- vided KPA with its first in-depth look at how members view the program. It helped the Agency iden- tify the features that members value most, and provided clear direction for the steps that should be taken to add to that value in the future. Performance Track launched a new Corporate Leader designation in 2004 to recognize companies that have multiple facilities in the program and that demonstrate an exceptional corporate-wide commit- ment to environmental stewardship. Looking ahead, Performance Track will continue working to broaden and deepen its member- ship, enhance its business value and appeal as a standard of achieve- ment, and increase the environ- mental value of the program. In March, 2005, KPA announced that it had selected 54 new Performance Track members in the most suc- cessful recruiting round since 2000. The Agency and its partners look forward to another year of growth and renewal for Performance Track as the program builds on the achievements and promise of 2004. 26 ------- Notes m'ft: r'2Sl ------- Notes 28 ------- Notes iMllM ฆ|^B i 1 iSll M Maawfcf SB ฆ WmSimMm ฆฆ111 SKSSBlllll WKt III mm ------- ------- ------- ------- |