By Shel Horowitz (697 words)
In the corporate world, if you start talking about going green, you’ll often hear messages like this:
“Yes, we’re going green, despite the expense. It’s the right thing to do.”
Yes, it is the right thing to do. And yes, very small companies are often nimble enough to seize the combined economic and environmental advantages.
But smart companies of any size can go green in ways that are highly profitable. Even large, slow-moving companies can save enormously.
Want some examples?
Southwest Airlines expanded its on-plane and in-terminal recycling program from just aluminum cans to a much wider assortment of recycled materials. Working with a vendor who is able to handle co-mingled recyclables—which means no extra burden on flight attendants who would find it difficult to collect paper, plastic, and aluminum separately—the company is slashing a big chunk out of its multimillion dollar annual waste disposal budget.
And, as Southwest spokesperson Laurel Moffat notes, “To date, we have saved more than 37,000 trees, more than one million gallons of oil, and more than 15 million gallons of water.”
For in-terminal recycling, the two airports piloting the program are diverting 12 to 19 container loads out of the waste stream every month.
Google, whose big, powerful servers not only hold and instantly organize much of the world’s knowledge, but consume enormous quantities of electricity, has invested in a massive project to develop a 350-mile-long 6,000-megawatt wind-powered electrical backbone off the North Atlantic Coast of the United States—that’s enough to power 1.9 million households. Stretching from Virginia to New Jersey, these connected turbines are well-located to ease power burdens on New York, Newark, Philadelphia, Wilmington, Baltimore, and Washington.
Using the backbone model will eliminate the need to build individual transmission lines from each offshore wind project, and thus reduce the number of permits and environmental impact studies—and bring the wind plants on line much sooner.
According to Rick Needham, Google’s Green Business Operations Director, the company is providing 37.5 percent of the initial-stage equity. And profit is most definitely one of Google’s motives: “We believe in investing in projects that make good business sense and further the development of renewable energy. We’re willing to take calculated risks on early stage ideas and projects that can have dramatic impacts while offering attractive returns,” Needham says.
The Empire State Building will shave $4.4 million a year in energy costs—40 percent of its former $11 million annual energy bills—in a major “deep energy retrofit” that involves replacing every single one of its 6,514 windows. For roughly $700 per window—versus $2500 each to completely replace them—each window is cleaned, coated with a thin UV-resistant film, and insulated with pressurized argon and krypton gasses. Other parts of the renovation include insulating the radiators, using both natural and artificial lighting more efficiently, wireless and portable thermostat sensors, and occupancy sensors that prevent heating or cooling of unused space. The building is also switching to individual tenant-by-tenant metering, meaning those who leave appliances and lights on when no one is using them will pay the cost of the wasted electricity.
Building manager and co-owner Anthony Malkin points out that buildings account for 80 percent of the city’s energy use, and not in equal numbers. “Even more interestingly, 20 percent of the buildings consume 80 percent of that energy. So 64 percent of all energy consumed in New York City is consumed by 20 percent of the buildings. That really took me by surprise.”
This project could easily be replicated elsewhere, because the impact on profitability is huge. Look at the numbers: The project cost is $13.2 million, and the annual return (savings) is $4.4 million. That means the first 3 years pay for the project (that’s an ROI of 33% a year). And the second three years put an extra $13.2 million into profit! With banks paying a measly 1.07 percent on a one-year and 2.3 percent return even on a 5-year CD right now, a 33 percent return is mighty attractive.
How much oil and coal could we eliminate, and how much capital would be freed up for job creation, if every company took just one of its buildings through a deep-energy retrofit process?
Shel Horowitz, shel at greenandprofitable.com, shows you how to “reach green, socially conscious consumers with marketing that has THEM calling YOU.” He writes the Green And Profitable/Green and Practical columns and is the primary author of Guerrilla Marketing Goes Green (John Wiley & Sons, 2010).
Southwest Airlines: http://www.blogsouthwest.com/blog/southwest-airlines-one-report-our-environmental-commitment
Empire State Building: http://www.popsci.com/science/article/2010-10/greening-world’s-most-iconic-skyscraper
Interest rates: http://www.bankrate.com/ as of October 21, 2010