Preventing Industrial Pollution at its Source
A Final Report of the Michigan Source Reduction Initiative
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MSRI QUANTITATIVE REDUCTIONS
The MSRI reduced its targeted emissions by 43%, from 1 million to 593,000 pounds and targeted wastes by 37 percent, from 17.5 million to 11 million pounds. (Table 3) The reductions exceeded the project reduction goals of 35 percent each for emissions and wastes. Although a few chemicals, such as acrylonitrile and dichlorophenol, were not affected, the vast majority (20 of 26) were reduced. Some chemical wastes and releases, such as formaldehyde, were nearly completely eliminated, and five chemicals-choroethane, chloromethane, methylene chloride, and tetrachloroethylene wastes and toluene air releases-were reduced by more than half. MSRI provided both new incentives and new techniques to achieve pollution reductions that Dow had not previously considered in its routine business and environmental operations.
In addition to the total quantities of reductions achieved, the types of chemicals and wastes reduced are particularly significant, because approximately two-thirds of the wastes reduced-4 million pounds-were chlorinated. (Table 3) These chlorinated wastes were a priority for the activists and environmental participants because they create dioxin under some conditions when incinerated.
MSRI achieved these reductions with a total capital investment of $3.1 million (Table 4). Dow estimates the project will save the company $5.4 million annually, through raw materials cost savings and reduced waste treatment costs alone, for an overall annual rate of return of 180%. The savings figure does not include some other clear financial benefits, such as increased capacity and the impact of lower production costs on sales that result from MSRI modifications to reduce waste.
A total of 17 projects delivered these reductions. (Table 4) All of them were directly related to increasing production yield, capacity, or quality improvements, and this enabled them to successfully compete for capital within each business. Projects relying on process modifications were responsible for the largest proportion of the reductions achieved, followed by those relying on in-process recycling. (Figure 2)
Several of the MSRI reduction projects are particularly interesting. For example, one project required only improved cooling to reduce nearly 2 million pounds of waste. Another revealed that reducing residual solvent in a raw material would both greatly reduce a waste tar and facilitate recovery of other chemicals in the remaining tar. A third focused on re-ordering production schedules to concentrate impurities in a waste stream and thereby enhance their recovery. Detailed descriptions of each MSRI reduction project are provided in Appendix II.
The rate of return for some individual projects was spectacular. (Table 4) One project, for example, required $330,000 and, when it is fully implemented later this year, it will return $3,300,000 per year in raw material savings and lowered production costs alone. Eight other projects paid for themselves in three to 12 months. All but one of the projects easily met business hurdle rates, the amount of profitability required to be achieved by a project for a business to invest in it, and the exceptional project was undertaken in part for other reasons by the plant. The majority of projects required relatively small amounts of capital, even those resulting in large reductions.
The details of the seventeen MSRI projects reveal important insights into pollution prevention:
- First, the vast majority of MSRI projects required relatively small amounts of capital. These small projects face fewer obstacles than large projects when competing for capital within a firm. For example, most Dow businesses have small capital project funds that will allow projects costing less than approximately $300,000 to go forward with an abbreviated business capital approval process. Thirteen of the seventeen projects fell below this cut-off point.
- Second, some of the MSRI projects reducing the greatest quantity of chemicals cost the least amount of money. There was no consistent correlation between amount of money required and pounds reduced.
- Third, opportunities were broadly available in the various businesses in the plant. They did not confine themselves to either "new" or "old" production processes or a particular type of manufacturing. Good reduction opportunities were found in almost every production process.
- Fourth, several projects focused on basic process changes and yet were designed and implemented in a relatively short time frame.
- Fifth, confidentiality agreements between activists and Dow were not necessary; it was possible to explain both processes and engineering opportunities for reductions with an amount of detail that supported informed conversations about opportunities without disclosing any business-sensitive information.
- Sixth, the most readily identified and adopted strategies were those that involved making process changes or internally recycling solvents. No business achieved its MSRI reductions by reformulating a product or substituting a product on the market with a service-based alternative. This experience suggests that product changes are the most difficult for businesses.
Of the 17 projects developed and funded during MSRI, three are still in the design and construction phase. (Table 5) The other fourteen projects are in place and are achieving anticipated reductions. Since many of the projects were put in place during 1999 and were not operating during the entire year, it will take a full year of operation to see the full reductions from these projects in annual public TRI reports.
Thirteen additional pollution prevention opportunities identified in the MSRI are still under development and were not included in the MSRI reductions. (Table 6) They represent some important opportunities to reduce an additional 100,000 pounds of toluene being released into the air and to reduce over 4 million tons of additional priority wastes. Some of these opportunities require negotiations with suppliers to deliver raw materials with fewer impurities, some require additional research and development for process modification changes or more complete analysis of contaminants in recycle streams, and some are simply waiting for an assessment of the impact of the first wave of changes implemented during MSRI before a second set of changes are implemented. One process, the manufacturing of chlorophenols, is barely at the outset of assessing opportunities, since it entered late in the two-and-one-half year project. MSRI participants will track these developing options in the upcoming months and advocate for their implementation wherever they prove practical.
It is much harder to assess the progress MSRI made in achieving the institutional change goals than to assess progress in the quantitative waste and emission reduction goals. Overall, the participants agree that there should have been a greater focus on the institutional change goals earlier in the project. It also would have helped a great deal if measurable benchmarks and milestones had been developed for institutional change. The lack of early focus adds to the challenge of assessing the state of institutional change in the company during the course of the MSRI project.
It is clear that the MSRI project provided a clear set of incentives and focus for the Midland site to contribute to the achievement of a set of Dow Global Environmental 2005 reduction goals which had been previously established by the company. Nonetheless, the activists recognize and Dow realizes that the accomplishment of the MSRI project alone will not lead to new incentives, procedures, or changes that will lead to a continuation or acceleration in pace to find similar opportunities elsewhere in Dow for pollution prevention. If the type of pollution prevention activity fostered by MSRI is to continue, some other types of effective new incentives will have to be established by the firm.
Results from a survey conducted near the end of the project also suggest that there is still work to do with respect to furthering an overall understanding of the concepts of environmental sustainability within the company. The ability to integrate and amplify the results of MSRI throughout Dow will be directly related to the understanding that all Dow employees have of the importance of the principles of sustainability, community concerns about their operations, and the benefits of direct, open interactions with the communities in which they operate.
ADDITIONAL REDUCTIONS IN WASTES AND EMISSIONS
MSRI reduced some important wastes and emissions that were not priority chemicals as a side benefit of the project. (Table 7) These ancillary reductions were also achieved using pollution prevention as defined by MSRI. Some of these chemicals were generated or released in extremely high volumes, particularly methanol, which was the single largest volume waste generated at the plant in 1996 and methylal air releases, the single largest air release. (Methanol was not selected by MSRI as a priority because it is easily and effectively treated in the site's wastewater treatment plant prior to release in the environment. Methylal was not a priority because it is not required to be reported under TRI and there was insufficient health and environmental effects data for the group to rank it.) When the pollution prevention reductions in these ancillary compounds are taken together with the MSRI priority chemical reductions, the MSRI reduced 75.6 million pounds of waste to 65.0 million pounds and 2.3 million pounds of releases to 914,000 pounds.
Finally, several projects were implemented during the course of the MSRI project that did not rely on pollution prevention to achieve their reductions but nonetheless reduced wastes and releases at the plant. These projects recycled waste streams into raw materials using out-of-process recycling techniques or sent wastes to treatment. Although these projects make a positive contribution to environmental improvement, they did not count toward the MSRI reduction goals, because they were not pollution prevention projects as defined by MSRI. Nonetheless, they contributed significant additional environmental improvements at the Midland site. (Table 8)
SIGNIFICANT POLLUTION PREVENTION OPPORTUNITIES
The MSRI experience clearly demonstrates the existence of very significant opportunities for pollution prevention that are cost effective, profitable, and readily implemented. The fact that the reductions were so significant at a plant where wastes and emissions had "leveled off" and not substantially decreased in the preceding five years, strongly suggests that many such opportunities would exist in most industries. MSRI demonstrates what is possible in terms of financial returns when the investigation of pollution prevention opportunities is sufficiently motivated.
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