Corporate Greenhouse | The Nation


Corporate Greenhouse

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Cool Companies begins with the story of Aaron Feuerstein, the Massachusetts business executive who attracted national media attention when his Malden Mills textile factory burned down in 1995. Feuerstein famously refused to seize on the blaze as an excuse to relocate to a low-wage zone overseas; even more remarkable, he also continued to pay all 3,000 of his workers while rebuilding the plant. Impressed by Feuerstein's decency, Romm asked his DOE colleagues to see how they might assist the company. Two years after the fire, Romm was pleased to attend the groundbreaking ceremony for the rebuilt Malden Mills factory, complete with a new, super-efficient natural-gas turbine that would provide the plant with both electricity and steam, a process known as co-generation. When Romm asked Feuerstein why he had focused on making environmental improvements at the very time he was trying to save his company from bankruptcy, the executive replied, "Over the long-term, it is more profitable to do the right thing for the environment than to pollute it."

About the Author

Mark Hertsgaard
Mark Hertsgaard, The Nation’s environment correspondent, is an independent journalist and the author of six books...

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That philosophy is the central message of Cool Companies, and for most of the firms the book describes, the extra profits come from improving energy efficiency. The point of energy efficiency is not to do without, but to do more with less. Toyota Auto Body of California, for example, a facility in Long Beach that manufactures and paints the rear deck of Toyota pickup trucks, was consuming 2.5 million kilowatt-hours (kWh) of electricity in 1991. By 1996 the plant had doubled its production volume while cutting its electricity consumption by one-third, to 1.7 million kWh, thanks to a comprehensive set of efficiency improvements, including better motors, lighting and air compressors. Toyota implemented these changes to improve product quality, not the environment, but Romm maintains that such "lean" initiatives tend to have green consequences: Reducing energy inefficiency reduces waste of all kinds, from defectively painted trucks to unnecessarily high electricity bills. Greenhouse-gas emissions and other forms of pollution, Romm suggests, are but physical manifestations of inefficient production processes and should be as abhorrent to corporate managers as they are to Greenpeace militants.

Of course, the single biggest cost facing most corporations is the wages, salaries and other expenses associated with maintaining a competent, productive work force. But here too, writes Romm, it pays to do the right thing environmentally. Designing buildings so that sunshine rather than electric light provides most of the illumination obviously reduces energy use, but its real value lies in how much labor productivity increases. "In a typical building, energy costs average $1.50-$2.50 per square foot, while salaries exceed $200 per square foot," writes Romm. "That's why productivity savings dwarf energy savings."

Consider the case of VeriFone, a Hewlett-Packard subsidiary that manufactures credit-card-verification machines. When VeriFone renovated a 76,000-square-foot facility in Costa Mesa, California, it chose a natural-light design that helped reduce energy consumption 60 percent. But the natural light made the plant's workers feel so much better--no more end-of-the-day headaches and drowsiness--that productivity also climbed 5 percent and the absentee rate dropped an astonishing 45 percent. As a result, an investment that the company expected to pay for itself in seven years was recouped in less than twelve months.

Energy efficiency may not sound like much of a rallying cry for the environmental revolution, but there is no denying that it packs an impressive financial punch. On the basis of the more than fifty real-world examples assembled in Cool Companies, Romm contends that most individual firms can cut their greenhouse-gas emissions in half while enjoying "a return on investment that can exceed 50 percent and in many cases 100 percent."

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