Strategic Social Responsibility

Some interesting sound bites in a recent New York Times article on a large desalination project in China. Although the $4 billion Beijiang Power and Desalination Plant is “a technical marvel,” “the desalted water costs twice as much to produce as it sells for.”

“Someone has to lose money,” Guo Qigang, the plant’s general manager, said in a recent interview. “We’re a state-owned corporation, and it’s our social responsibility.” In some places, this would be economic lunacy. In China, it is economic strategy.

For more in-depth coverage, see Water World’s report on the Chinese desalination market.

Hydraulic Fracturing and Marcellus Shale

Yesterday, hydraulic fracturing and Marcellus shale were front page news — both locally and nationally.

The top story in the Centre Daily Times was “Forest Leases Under Fire.” Already, the Commonwealth of Pennsylvania has issued leases to gas companies for nearly half of its 1.5 million acres of state forest. At issue are concerns that current Governor Tom Corbett will over turn a moratorium enacted by outgoing Governor Ed Rendell. According to a study by the Department of Conservation and Natural Resources (DCNR) there remain “zero state forest land acres suitable for gas leasing involving surface disturbance.”

In an interesting twist, the article reported that further development would threaten the sustainability certification of Pennsylvania’s forests. In particular, the Forest Stewardship Council (FSC) has certified that the Commonwealth’s state forest operations are sustainable, based on factors including a 2 percent rate of conversion of forests over any five-year span. However, even without further leasing, several state forests are projected to lose more than 2% of their acreage to conversion by 2020, jeopardizing their certification. Some 35 wood-industry related companies have attained FSC certification for adopting sustainable practices in Pennsylvania, which they use as a selling point for their products. They stand to forfeit their certification if their harvests come from forests deemed to be losing acreage unsustainably. An expansion of drilling in state forests — as Corbett has suggested — would exacerbate the problem.

In another front page story, the New York Times continued its Drilling Down series which examines the risks of natural-gas drilling and efforts to regulate this rapidly growing industry. The latest installment announced “Wastewater Recycling No Cure-All in Gas Process.” Lately, the oil and gas industry has been touting innovations in wastewater recycling. But apparently the rhetoric and reality don’t match up. In Pennsylvania, for example, natural gas companies recycled less than half of the wastewater they produced during the 18 months that ended in December, according to state records.

According to Brent Halldorson, chief operating officer of Aqua-Pure/Fountain Quail Water Management, a drilling wastewater recycling company: “No one wants to admit it, but at some point, even with reuse of this water, you have to confront the disposal question.” He added that the wastewater contains barium, strontium and radioactive elements that need to be removed.

Data posted by the commonwealth on Tuesday, show that operators produced more than 680 million gallons of wastewater in the year and a half that ended in December 2010. Of this amount, well operators reported recycling at least 320 million gallons. At least 260 million gallons of wastewater were sent to plants that discharge their treated waste into rivers. Another 50 million gallons or more of wastewater is unaccounted for, according to state records.

Electric Utilities and Wastewater Regulations

Something must be in the, err, water…

On the heels of my recent post about Toxic Waters, tomorrow’s Wall Street Journal features a story about plans by the Environmental Protection Agency (EPA) to tighten regulations on the quality of the wastewater discharged from coal-fired power plants.  At issue are the toxins left behind from the scrubbing process used to remove the toxins from the air.

“Power plants pump out dirty water in part because of technology installed to stop the spread of soot and ash from smokestacks. The systems that clean smokestack emissions scrub the exhaust with water-based compounds. If left untreated, that mixture of water and metals can contaminate waterways and drinking water, the EPA said.”

For the full story, visit “Utilities Face Stiffer Wastewater Rules.”

Toxic Waters

On Friday night I watched Frontline’s “Poisoned Waters” (from Netflix via Roku), a two hour investigation by Pulitzer Prize winning journalist Hedrick Smith into “the growing hazards of water pollution to human health and the ecosystem.” The program was divided roughly into two segments: First, a look at Chesapeake Bay, and second, an investigation of Puget Sound.  In addition to detailing issues specific to each location, both Chesapeake and Puget were “read” as microcosms of the much larger problem facing America’s waterways.

Broadly speaking, the show highlighted two major issues: agricultural runoff and storm sewers.  Technically speaking, both are considered “nonpoint source pollution” and susceptible to increased ambiguities in terms of measurement and accountability (as compared with “point source pollution”). On the issue of agricultural runoff specifically, The Washington Post described Frontline’s interviews with Jim Perdue, chairman of Perdue Farms, and Bill Satterfield, spokesperson for the Delmarva Poultry Industry, as “the kind of verbal evasions that would twinkle a tobacco industry scientist’s eye.” I’m pretty sure that having yourself compared with tobacco “scientists” is never good. Frontline also noted the Clean Water Act’s “citizen suit provision,” which allows citizens to sue polluters and the government for enforcement failures.

Another point raised by the Frontline “Poisoned Waters” episode is the growing gap between the contaminants in use and those covered by regulations. In particular, Frontline discussed a study by the U.S. Geological Survey that tested the Potomac River for some 277 new contaminants NOT covered by the Clean Water Act. Overall, they found 85 contaminants. Of these, only about half of the compounds had safety guidelines. But Frontline also noted a second gap — this one between the contaminants in use and the contaminants capable of being detected. Not even the expanded list tested for by the USGS covers the range of contaminants potentially in use.  In other words, here we see the possibility of externalities which are not yet capable of being externalized, let alone interalized.

Then last night The New York Times home page featured a lengthy story on “Toxic Waters,” along with a companion interactive database of more than 200,000 facilities that have permits to discharge water pollutants. The reporting behind the story is massive, drawing on data from the Environmental Protection Agency (EPA), along with “hundreds of thousands of water pollution records [obtained] through Freedom of Information Act requests to every state,” and interviews with “more than 250 state and federal regulators, water-system managers, environmental advocates and scientists.”

A few key points:

  • “Nationwide, polluters have violated the Clean Water Act more than 500,000 times.”
  • “[T]he E.P.A. regulate[s] more than 100 pollutants through the Clean Water Act and strictly limit[s] 91 chemicals or contaminants in tap water through the Safe Drinking Water Act.”
  • According to Lisa Jackson, the EPA’s administrator, “[D]espite many successes since the Clean Water Act was passed in 1972, today the nation’s water does not meet public health goals, and enforcement of water pollution laws is unacceptably low.”
  • “[R]esearch shows that an estimated one in 10 Americans have been exposed to drinking water that contains dangerous chemicals or fails to meet a federal health benchmark in other ways.”
  • “Because most of today’s water pollution has no scent or taste, many people who consume dangerous chemicals do not realize it, even after they become sick.”

According to the database, Pennsylvania is home to 8,654 regulated facilities. Here in the Centre County region where I live, most of the facilities have no reported violations.  However, there were 6 facilities in the area with violations, which I have listed below, first, based on length of compliance failures (e.g., Cerro Metal has been out of compliance 11 of the past 12 quarters), and second, for those facilities not out of compliance, by the number of reported violations (e.g., Mid Centre County PDF has 37 violations, but is not out of compliance). As with Pennsylvania more broadly, NONE of these facilities has been fined for these violations. Again, these data are all from the New York Times website and based on EPA data for 2004-2007 inclusive.

  • Cerro Metal — 61 violations. This facility has been out of regulatory compliance 11 of the past 12 quarters.
  • University Area Joint Authority — 18 violations. This facility has been out of regulatory compliance 5 of the past 12 quarters.
  • Hanover Foods Corp WWTF — 57 violations.  This facility has been out of regulatory compliance 3 of the past 12 quarters.
  • Mid Centre County PCF — 37 violations.  This facility has not been out of compliance in the past 12 quarters.
  • Moshannon Valley Regional — 34 violations.  This facility has been out of regulatory compliance 4 of the past 12 quarters.
  • Port Matilda Boro WWTF — 2 violations.  This facility has not been out of compliance in the past 12 quarters.