This week's post was written by guest blogger Sarah Medearis; Sarah is a Senior Consultant with Antea Group’s Baltimore Office and is the company’s Operational Performance and Assurance Practice Leader.
Twenty-first century environmental regulations require more detailed pollutant accounting than their 20th century predecessors, and rely on increasing public demand for transparency and corporate social responsibility to green industrial operations. Ontario’s Ministry of Environment (MOE) is one of many agencies in North America requiring manufacturers to track and publicly account for toxic substances at their facilities under its new Toxics Reduction Act (TRA) regulations (O. Reg. 455/09). Finalized in December 2009, reporting requirements for some of the listed toxic substances were due for the first time on June 1 of this year.
These new and more rigorous regulations draw on each other, creating a complex diversity of similar requirements throughout North America. The MOE drew upon the Massachusetts Toxics Use Reduction Act (TURA) and New Jersey’s Pollution Prevention (P2) Act to develop the TRA requirements. Ontario’s TRA regulations focus on specific industrial operations at a facility that create or use toxic substances, not just those that result in pollutant emissions from the facility as a whole. Accounting for individual toxic substances is a more complex process than previous requirements. It starts by organizing facility operations into distinct “Stages” within which there are one or more processes using, creating or emitting toxic substances.
At the process level, measurements and calculations must be performed to quantify the amount of toxic substances used, created, transformed, destroyed, contained in the product, released or disposed of, or transferred to another process or medium. The data and quantification methods must be evaluated for accuracy with mass balance checks performed to identify any imbalances between input and output so that all quantities can be explained.
As part of the drive towards transparency, and to ensure there are no hidden icebergs under the water, MOE requires firms to also report costs associated with these industrial operations in its P2 plan due at the end of the year. MOE is particularly interested in all the “indirect costs” that the agency believes really drive P2, including:
- Environmental, health and safety compliance
- Pollution liability
- Waste disposal
- Hazardous material storage & handling
- Worker protective equipment, ventilation
- Container labeling, packaging (CLP), material safety data sheets (MSDS)
- Administrative burdens
- Public relations
- Energy, operation and maintenance for pollution control equipment
As part of the expected corporate social responsibility, the P2 plan must identify at least one method for reducing toxic substances under each of seven P2 categories. Both feasible and non-feasible options must have a rough toxic substance reduction estimate. For those options that are considered technically feasible, the P2 plan must document the anticipated cost savings. The net present value and timelines for implementing feasible P2 options must be outlined, along with the anticipated cost savings of both direct and indirect (and co-benefits) including:
- Total Savings
- Return on Investment (ROI) and Payback Period
- Replaces Equipment Scheduled for Repair/Replacement
- Energy Efficiencies
- Reductions in Byproducts
- Reduced Worker Exposure (including reductions in claims, comp time, PPE costs)
The increased complexity of these newer pollutant regulations and the sharing of regulatory requirements across North America do have benefits. Despite the variations among regulations, environmental professionals experienced with, or certified under, TURA and the New Jersey P2 Act can support firms in meeting Ontario’s 2011 TRA accounting, planning and reporting requirements. As the reach of these regulations expands, so does the professional expertise to stream-line and more efficiently meet the regulatory requirements as well as reap the benefits of P2 plans. In addition, while annual pollutant reporting and compound-specific P2 plans are required, implementing P2 measures remains voluntary. But with increasing public pressure for corporate social responsibility, together with the effort spent preparing compound-specific P2 plans, companies can make both social and environmental gains by greening their operations.
