Cal/EPA Environmental Management System Project Report to the Legislature: Seventh Quarterly Update October through May 2001

Table of Contents

• Executive Summary
• Introduction
• Pilot Project Descriptions
• Environmental Performance Improvements
• Robust and Effective Systems for Public Health and Environmental Protection
• Quality, Conclusions, and Recommendations
• Appendices

Executive Summary

This report provides the Legislature an interim summary, and seventh quarterly update, on the Cal/EPA Environmental Management System (EMS) Project authorized by Assembly Bill 1102 (Stats. 1999, Ch. 65), codified in Public Resources Code, Section 71045 et seq. The findings, conclusions, and recommendation presented herein are based on analysis of data provided to date by participating pilot organizations, and on extensive dialogue with stakeholders in advisory group sessions, workshops, and informal meetings. A Quarterly update will be provided to the Legislature for October 1, 2001 with the final report due January 1, 2002. Additional update data will be collected, analyzed, and vetted through the stakeholder working groups to support the final report analyses, conclusions, and recommendations. While the project is not complete, there is sufficient information to support the interim conclusions and recommendations described.

Seven pilot projects, comprised of agriculture, manufacturing, computer components, defense, metal plating, beverage industries and municipal sewerage facilities and representing various stages of EMS implementation, were established for the purpose of evaluating whether and how the use of an EMS;

• increases public health and environmental protection and
• provides better public information than existing regulatory requirements

The overall conclusion from these pilot studies is that implementation of a well-designed EMS results in substantial improvements in both environmental performance and the quality and quantity of information available to the public as compared to that resulting from existing legal requirements.

Findings

The results from the EMS pilot projects are comprised of both quantitative data on environmental performance changes as well as qualitative information on changes to the quality and quantity of information available to the public, and information about aspects of management systems that result in public health and environmental protection. Tabular summaries of the quantitative results are given in the following section. A more complete description of the qualitative information can be found in the body of the report.

Performance Improvements

Broad and significant performance improvements were found in those organizations with developed EMSs. Improvements ranging from a 33% reduction in a regulated pollutant emission to the complete elimination of a regulated emission were seen. Reductions were greatest in those areas where significant environmental impacts were identified in the EMS process, and for which aggressive targets were set. Very significant performance improvements were also seen in areas not covered by existing standards and regulations. These included energy use, solid waste reduction, and fresh water use. Three of the seven pilots have not yet reported EMS based improvements because full implementation has not yet occurred.

Information Improvements

Substantial increases in both the quantity and quality of information available to the public, beyond that required by law, were seen in all projects, including those that had not completed the EMS design and deployment process. This information included comprehensive assessments of environmental aspects, impacts, performance targets, management strategies, and performance data relative to targets. Community, local government, public interest group representatives, as well as Cal/EPA found this information of great value.

Role of Cal/EPA in Pilot Projects

The role of Cal/EPA (the State) in the pilot projects varied considerably with different projects. In projects where an EMS pre-existed the pilot project, the role of the state was to observe and document process and performance, communicate this information to interested stakeholders, and to facilitate communication between stakeholders and pilot facilities. In these pilots, the State and the community had a modest influence on the EMS design and implementation, however participation by the State substantively increased the information exchange between the pilot and the community.

In projects where the EMS was developed within the project, an expanded State role included the initial decision to implement an EMS, as well as training, guidance, and provision for community participation in the EMS design process. In these pilots, the State and the community had significant influence on the design of the EMS. The presence of the State in the process greatly enhanced communication between the pilot and the community.

Conclusions

EMSs are effective tools to manage the environmental aspects of a wide variety of organizations and their use can result in significant performance improvements. EMSs can also increase both the quantity and quality of information available to the public beyond that required by law. The State can play a valuable supportive role with small and medium sized business in the design and implementation of a high performance EMS. The State can play a valuable role with organizations of all sizes, influencing the design and deployment of an EMS to address the environmental and public health issues of interest to the broader community. Performance targets, particularly aggressive targets, are critically important in promoting performance. Environmental quality is largely a regional issue, therefore performance enhancements from a regionally implemented EMS have the potential for even greater benefit.

Performance Results [Sec. 71045(a)(3)]

 

Information Results [sec. 71045(a)(4)]

 

¹ Anheuser-Busch, Inc., Lockheed Martin Aeronautics Company, IBM, and San Diego Metropolitan Wastewater Department have completed their EMSs. Information is provided to the public in a variety of ways. Examples include web sites, annual reports, through public relations departments, newsletters and Cal/EPA established working groups.

² Artistic Plating, Central Marin Sanitation Agency (CMSA), the Vineyards and Wineries Project: Benziger Family Winery and Davis Bynum Winery have shared EMS information with Cal/EPA and the Working Groups. Artistic Plating, CMSA, and the Vineyard and Wineries Project and are currently developing their EMSs.

³ Pentel has shared EMS information with Cal/EPA and will be sharing information at the Southern California Working Group meeting at the Pentel facility on May 17, 2001. Pentel's EMS is also in development.

Conclusions

The conclusions presented below are derived from the quantitative findings presented in tabular form above and the qualitative findings presented in the main body of the report. Conclusion presented in this report focus primarily on those issues raised by AB 1102 (Public Resources Code, Section 71045 et seq.) As knowledge on additional issues was gained, either from the pilot projects or the extensive stakeholder discussions, some conclusions beyond the scope of AB 1102 are presented.

1. Where data was available, compliance with existing regulatory standards increased significantly for those organizations implementing an EMS.
2. All organizations with established EMSs demonstrated environmental performance significantly beyond that required by any "permit, requirement, authorization, standard, certification, or other approval issued by a federal, state, regional, or local agency" (legal requirement). Performance beyond legal requirements was demonstrated in several specific areas regulated by law. Such performance is attributable, at least in part, to the development and implementation of the EMS, and not to the applicable legal requirement.
3. Significant performance improvements were demonstrated in environmental areas for which there are no legal requirement. Such areas include energy consumption, solid waste generation, and fresh water use. These performance improvements represent significant potential for environmental benefit and they are not driven by legal requirements.
4. Compliance and general environmental performance improvements can be directly related to two principal factors:

a. Design and implementation of a comprehensive, integrated management system of policies,  pollution prevention, training, assessment, and continual improvement.
b. The establishment of clear, measurable objectives to drive performance.

5. Information quantity and quality available to the public increased substantially both as a result of EMS development and implementation. This result can be attributed to existence of information about the broad range of environmental impacts and resource use, management strategies and performance measures that only existed because there was an EMS. This information, which is noted in the Information Results above, was not shared with the public as a result of any legal requirement. Community stakeholders have indicated that this supplemental information is of high value.
6. Management systems developed without external input from government, community representatives, and other stakeholders tend to be focused on compliance management and internal business needs. Management systems developed and deployed with participation of government and other external stakeholders have a much greater focus on general environmental performance in addition to compliance. Performance objectives can be significantly influenced by government and other external stakeholders. As a result, participation by government and external stakeholders results in an EMS with greater community and public value.
7. Working partnerships between government, communities, and business do not develop spontaneously, but must be promoted, nurtured, and supported with training, facilitation, and in some cases, financial support.
8. Companies enter into working partnerships with government and communities for a variety of reasons. Such reasons include:

a. Business benefits which accrue from good, positive community relations.

b. An avoidance of costly, often legal, confrontation with government and communities that result from either poor management or poor communication.

c. Recognition by several companies in the pilot group of the importance of the business' social contract with the community to future economic success.

d. A vision that at some future time, there will be refinements to the environmental regulatory system with the objective of making that system more efficient and effective in achieving desired environmental outcomes. Also, the recognition that building good relationships with communities and government will afford these companies with a better opportunity to influence such refinements, if or when they occur.

9. Reasons that did NOT motivate companies to join pilot projects.

a. Expectation of regulatory concessions, either in standards of performance or quality of information required.

b. Expectation of reduced oversight by regulatory agencies

c. Expectation that regulatory agencies would not increase oversight of companies as a result of their participation in the pilot projects.

10. Larger, more technically sophisticated firms, with greater financial resources, can develop EMSs without government and/or community support, however as stated above, such internally developed EMSs have less focus on the broader environmental, public health, community, and regional issues. Firms with more limited technical and financial resources may require significant assistance in the form of training, consultation, and direction in the development and deployment of an EMS that benefits the public.
 
11. Government best functions as a convener, facilitator, and leader of communities and business in the promotion of environmental excellence goals and practice.

Recommendations

The learning from California projects, as well as from other states and countries, establishes the importance of setting specific and measurable goals and targets for environmental improvement. Statewide, regional or business sector goals and targets can help align the efforts of individual companies, regional partnerships and government agencies to achieve significant environmental improvements. As a result:

• It is recommended that further demonstration (pilot) projects be established with individual companies, in business sectors with substantial environmental impact, to develop EMSs which include specific, measurable targets for environmental performance which goes significantly beyond legal requirements and current performance.
 
• It is recommended that Cal/EPA identify business sectors or regions with significant environmental impact, with whom partnerships can be formed to improve environmental performance through the integrated application of EMSs, pollution prevention, multi-media inspection, enforcement and recognition.
 
• It is recommended that a broad outreach and dialogue be initiated, to engage the opinion leaders and the public as to what California's long-term environmental sustainability and resource conservation goals should be

If the regulatory system is to be optimized for performance and improved environmental outcomes, the permit system, as the central element of the system, must be evaluated for enhancement. If enhanced environmental outcomes are the primary objective of the regulatory system, and if integrated cross-media management of the environment produces better outcomes, then the permit system should reflect this. Such a system will require legislation, however work should be initiated to determine the basic characteristics of such a system, which would inform the legislative development process. This enhanced permit system would likely function within a supplemental regulatory track for entities which have demonstrated the willingness and ability to implement robust management systems which have achieved superior results.

• It is recommended that a project be initiated, with broad legislative, stakeholder and public input, to design and test a truly multi-media, systems based, outcome-focused permit system.

Cal/EPA will have difficulty being seen as a leader in cross-media, systems management, and enhanced environmental performance, unless it implements such an approach internally. 

• It is recommended that Cal/EPA set a goal to become a truly green government agency through the design and implementation of a Cal/EPA EMS, which sets aggressive performance targets in significant environmental and resource conservation areas.

Recognition of environmental performance excellence is valued by businesses, as public recognition for green production can add value to product (e.g. wines produced from organically grown grapes). 

• It is recommended that a systematic process to evaluate and recognize truly excellent environmental and resource conserving companies and government agencies be established.

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