What kind of company are you? Are you driven by profits or by principles-specifically, by my principles? Do you recycle, reuse, reapply? Do you conserve, preserve and reserve? What is your carbon footprint, your quality index, your environmental scorecard? Can I trust you?
Increasingly, say industry experts, today’s consumers-more informed and educated than ever before, and, thanks to the Internet, flexing vastly greater power of choice-want to know more about a food or beverage product than simply what meets the eye. They want to know how the product was processed and the environmental impact of the processing. This, in turn, has pushed major retailers such as Wal-Mart to demand more environmental responsibility from their food and beverage suppliers. In short, where quality once meant consistency, the word now encompasses a wide-ranging definition, beginning with sustainability. Ultimately, that’s good news for processors: Enter the age of the sustainable food plant.
“Forty years ago, consumers assumed the companies knew best, that they would never put an unsafe product on the supermarket shelves,” says Jim Hauge, environmental and safety manager at Kettle Foods, a snack-chip manufacturer. “That began to change when ingredient and nutrition information began to appear on product labels. Now there’s a much greater awareness of not just the health effects of foods, but of the whole food system in general.”
“Manufacturing has gone from being relatively unimportant to being very important,” comments John Blanchard, a principal analyst focusing on food and other packaged-goods industries for ARC Advisory Group. “Innovation is still important, but now responsiveness to the market is critical. That means responding to new customer interest in not just the quality of the product, but the quality of the processing,” he says.
Sustainability at a food processing plant means, in part, managing processing resources, including energy, water, fuel, chemicals and other non-renewable inputs, in such a way to reduce, conserve, reuse and/or recycle those resources to reduce a plant’s environmental “footprint.” Sustainability also brings in economic and even social components into what has been called a “holistic” approach toward processing-in short, aiming toward a goal where all the resources used by an operation, whether they be natural, monetary or human, are utilized to create, in essence, a zero-use system, one in which every resource is fully replenished.
“More and more companies are putting measurables on sustainability,” says Scott Normandeau, a partner with Solid Waste Solutions, an Evanston, IL-based consultancy focused on helping processors find dollars in waste products. “It’s still in its infancy, but it’s key to establishing benchmark performance to build from. Overall, what we’re seeing is that sustainability can be both market-driven and profit-driven.”
Many companies already have programs in place to conserve resources to reduce costs- it’s just good business not to waste money, of course. The word “sustainability” defines the approach in a new way: By shrinking the resource footprints while at the same time becoming a corporate good citizen in the community, a processor improves compliance with regulations and has a positive long-term societal impact in their local communities as well as in the larger global community.
Blanchard points out that many factors drive growing environmental awareness among food and beverage shoppers, which connects to a growing interest in the environmental sensitivity and sustainability of the processing. Key among these is the marketing opportunities offered by the Internet, which affords small, niche-type companies the same marketing possibilities as major corporations. “Specialty manufacturers can reach those consumers just as quickly and efficiently, and they can do it with who they are and what they stand for, not just with a steady stream of new products,” Blanchard said.
“‘Green’ is a nice badge for a company to wear when we walk in,” says Peter Meehan, co-founder and CEO of Newman’s Own Organic, which partners with a variety of processors to co-pack Newman’s Own Organic brand snacks, cookies, oils, vinegar and pet foods. “I think we have a brand that’s meaningful in the trade, and we are a very loyal partner. The companies we work with want us to take a lead in sustainability-they want to be associated with that.”
Mary Kay Kaufmann, division president with Nalco, a supplier of water-treatment and process-improvement systems, points out that food industry suppliers are feeling the shift toward environmental responsibility as well: “Our food industry customers increasingly have assigned senior level accountability to improving corporate sustainability based on measurable objectives for conformance, economic impact and social accountability. They recognize that sustainable practices lead to greater efficiency, a positive bottom line impact and enhanced brand image and value.”
Efficiency and responsibilityIt’s not just progressive, socially aware niche players who are benefiting from the focus on sustainability. Major processors also understand the cost-savings sustainable processing can mean. But whether large or small, processors agree that a full sustainability program involves closely managing dozens, and perhaps hundreds or even thousands, of details that collectively shrink resource footprints and add substantively to the bottom line.
“There are very few home runs out there in terms of immediate big energy savings or sustainability savings,” comments Dave Watson, vice president of engineering at Pepperidge Farm, the snack and cookie manufacturer. “It’s the hundreds of small details that will add up to the big savings. What we stress at our company is a teamwork approach in managing these details.” Pepperidge Farm’s director of environmental programs, Tom Rieth, heads a monthly conference call that includes management of the company’s eight plants to discuss updates in energy savings, fuel and water usage, and other resource issues.
Rieth and Watson say that the company goal is to flat-line total delivered cost of product from year to year. Rieth is developing a sustainability scorecard for company-wide use that “tracks where we are in terms of resources-water, gas, and our overall carbon footprint.” He notes that gathering and managing the scores is challenging, because the eight Pepperidge Farm plants are located in seven states, and the carbon footprint varies from region to region. Moreover, state regulations factor in: In the company’s recently built plant in Bloomfield, CT, which received Food Engineering’s Food Plant of the Year award in 2004, 10% of the plant’s power is supplied by a large fuel cell-but Connecticut, which is home to most of the US fuel-cell industry, offers incentives for fuel-cell use.
Heinz North America is another company establishing baseline data as part of what it calls its Utility Optimization Process (UOP). “We have been capturing utility and production data for five-plus years in a global data warehouse,” comments Don Fonner, utility services manager. “What we’re doing now, however, is incorporating metering and monitoring systems to capture real-time data. This allows us to find anomalies as they’re happening rather than relying on historical data and then going back to try to figure out the problem.” The UOP program focuses on electric power, natural gas and water use, with projected savings benefits for fiscal 2007 of 19.5 million kilowatt hours of electricity, 54 billion BTUs of natural gas and 30 million gallons of water. “The across-board-goal is to reduce energy and natural-resource use,” says Fonner. “It takes time and it takes dollars, but I’m very pleased with our progress so far.”
John Stiers, director of environmental affairs at Anheuser-Busch (A-B), underscores the practical reality for processors.
“We’ve found that things like energy efficiency and environmentally sensitive processing and sustainability can co-exist with ROI. You can do the right thing for the environment and the shareholders at the same time,” he says.
Cindy Baerman, general manager of JohnsonDiversey’s Food & Beverage Group, agrees. “JohnsonDiversey has been a pioneer in environmental stewardship as recognized in not only our products but our leadership in LEED certification of our facilities. Around the globe, our food and beverage customers expect us to use our knowledge and products to deliver environmentally responsible cleaning and sanitation solutions,” she says. “Customers understand that environmental stewardship has a direct correlation to their profits and productivity, as well as the expected social responsibility.”
Stiers has seen a steady progression from a compliance-only approach to integration of progressive technologies to sustainability. “At our company, we are guided by a basic philosophy: Brewing, packaging and shipping the highest quality products in the most efficient and responsible manner. That means we have got to continually figure out ways to reduce our use of natural resources.”
Water, water-it's not everywhereA mega-volume processor like Anheuser-Busch approaches sustainable processing from many standpoints. Beer brewing consumes enormous quantities of water, a dwindling natural resource, especially in the western US, where the company operates two huge breweries.
“We looked very closely at every place we use water throughout our breweries. Once we understood both the needs and limits of those uses, we went to the equipment parameters to figure out how we could use the minimum amount of water,” Stiers says.
The brewer created three fundamental ideas to guide not just water use, but use of all natural resources, including energy: one, all uses of the resource must be as efficient as possible; two, the resource will be recycled whenever possible; and three, where in-plant recycling is not possible (or sanitary), the resource will be used in outside-the-brewery applications, such as irrigation. For water alone, A-B targets a goal of reducing overall use by 20% in 20 years on a brewery-by-brewery basis.
“There are two sides to water,” adds Scott Butler, vice president of operations services at Del Monte Foods. “One is acquiring it, the other is using it. For a processor like us, with several operations in the West, where water is a major environmental issue and fundamental natural resource, both of those are critical. The key driver, of course, is managing costs. The cost of discharging water into the public system has gone up considerably, so bringing that down to the lowest cost possible has helped drive our overall approach to water use and to shrinking our water footprint.” Del Monte, he points out, owns large tracts of farmland, and has become adept at recycling process water used at its plants into irrigation water for crops.
Pilgrim’s Pride, the Pittsburg, Texas-based poultry processor, is another major water user -necessarily so, because federal meat-inspection regulations require large amounts of water to be used for plant sanitation and bird cleaning. Recycling has been the answer for the company. In fact, half of its 50 processing operations recycle water; in total, Pilgrim’s recycles 4.1 million gallons of water every day. The poultry processor has installed large-volume water recycling systems from American Water Purification Inc. at five of its operations. (AWPI’s first commercial water-recycling system was installed in 1997 at a Gold Kist plant.)
“We’ve been working very hard and for a long time on recycling,” comments Greg Lisso, the company’s vice president for engineering and environmental affairs. “For us, there’s really no silver bullet for reducing water use, since federal regulations require us to use x amount of water in our operations. But recycling brings us a double benefit: one, we don’t have to buy as much water and we don’t have to treat as much water.” USDA regulations permit recycled water to be used in “like use” applications and, after treatment, for sanitation in meat and poultry plants.
A full sustainability program goes beyond water. “I think breweries have always had a kind of recycling mentality,” says Anheuser-Busch’s Stiers, “going back to 100 years ago when spent grain was sold as livestock feed.” Pepperidge Farm and Del Monte also recycle edible waste into livestock feed.
Anheuser-Busch is also the world’s largest operator of an anaerobic digesting system, which turns wastewater into biogas. In fact, approximately 15% of A-B’s natural gas needs are fulfilled by the biogas. A chemical-management program likewise focuses on finding efficiencies and alternatives wherever possible: particularly safe, biodegradable yet effective products.
Details, detailsBesides improving management of non-renewable resources to reduce footprints, processing plants are finding new ways to zero in on those all-important details. Company inspections of Pepperidge Farm’s operations led to the surprising discovery that the plants leaked compressed air like sieves-in fact, some plants were losing as much as 20% of their power-sucking compressed air production. Patching up the “micro leaks,” as Dave Watson and Tom Rieth call them, saved immediate dollars. The company also cut boiler pressure in half. Now the company is exploring “different cogeneration options” for heat recover and reuse, says Rieth. Like many food processors, Pepperidge Farm recycles all fiberboard and cardboard; it also has switched to distributing fresh products such as breads in returnable, reusable plastic containers. To reduce in-plant water use, all appropriate equipment is sanitized with a dry, rather than wet, wash.
“We’re centralizing our sustainability metrics,” says Scott Butler. “Most of our data was decentralized to the point where it was very difficult to say what our company’s overall environmental footprint is. But that’s changing. We’re developing a baseline, then goals for continuous improvement.” In that effort, Del Monte has created a pilot program with Enablon, a French company that offers a software package to collect resource-usage information. “The Europeans are pretty far ahead of us on most of this stuff, frankly,” points out Butler, who adds that Del Monte also belongs to the Global Reporting Initiative, an international network of thousands of business, civic, labor, and professional institutions that have united to create a sustainability reporting framework.
Heinz North America has changed lighting to energy-efficient bulbs on a light-by-light basis; it has also optimized boilers and steam generators, upgraded air compressors, upgraded refrigeration controls and installed co-generation units for heat efficiency. “We assess, we calculate and we review internally on a daily/monthly basis,” says Fonner. “This has got to become a day-to-day, shift-to-shift thought process for everyone involved. Awareness and responsibility are key.”
The gold standardWind is just one resource filling the sails of sustainability at Kettle Foods-but wind fills those sails literally. At its headquarters plant in Salem, OR, and its new LEED-designed operation in Beloit, WI, (see sidebar on page S4) Kettle buys wind-generated energy to create a 100% carbon offset. According to Jim Hauge, the offset means that approximately 250,000 pounds of CO2 pollution are prevented each year at Beloit alone.
“Our guiding philosophy is to find all opportunities to reduce and offset environmental impacts. There are so many benefits to this approach-long-term economic benefits, certainly, but moral and social benefits as well,” says Hauge.
The “right thing to do” at Kettle has been the guiding principle at the new Beloit operation, which has pending gold-level Leadership in Energy and Environmental Design certification from the US Green Building Council. If the gold level is achieved (the company will find out in September, says Hauge), Kettle will be the first non-beverage food processing plant in the US with gold LEED certification.
The result is a tribute to sustainable food processing. Three-quarters of the construction waste was recycled for other uses or otherwise salvaged. Twenty percent of the building materials, including steel and brick, had been previously used. Forty percent were sourced locally. The roof is made of reflective materials to keep the building cool. The plant’s gas and electrical equipment feature variable-speed drives so the equipment never runs faster than required. Inside the plant, water is filtered and reused for washing potatoes, saving 1.6 million gallons a year. Excess process water is used to flush restroom toilets, saving another 120,000 gallons per year.
Brass ringsStill, there’s more to be done. Hauge calls recycled chip packaging “the brass ring” for the snack industry, and Kettle is working with its packaging suppliers on new laminates that are amenable to recycling or reuse. “We’re trying to do our part to push the industry,” he says. “Our foremost consideration for packaging has to be the integrity of the product. For us, that means the packaging has to be impermeable to light and oxygen. Recyclable packaging is an extremely challenging technological problem. There’s a marketing aspect to it, too, because packaging is our greatest vehicle for informing our customers about who we are.”
Supplier commitment to sustainability is key, and not just for packaging.
“We’ve oriented our global R&D pipeline to support the industry’s commitment to sustainability with new Nalco innovations like water-conserving system control equipment, cleaning systems to reduce energy waste and safer, high-actives polymers,” says Nalco’s Mary Kay Kaufmann. “Another example is the water efficiency program offered by the JohnsonDiversey Nalco Alliance.”
“Once we measure water use, water costs and energy costs associated with production, facilities have the metrics needed to make decisions on sustainability projects” according to Pat Anderson, manager of the Aquacheck water efficiency program for the JohnsonDiversey Nalco Alliance.
Both Kaufmann and Anderson agreed that the focus on these new types of program and technology platforms should produce sustainable ROI to their food industry customers.
At Solid Waste Solutions, “we try to get processors to look at waste, at all the things they throw away, not as a liability but as a potential revenue source. If they manage waste as an asset and resource, there’s profit there,” says Scott Normandeau. “I tell our clients to look at the perception the public has of them. That’s their reputation, and if they care about public perception, then their reputation has value. If they manage their waste in a way their local communities find compatible, that adds value. If they’re doing it better than their competitors, that brings value.”
Lydia Kuyawa-Dow of SWS says the heart of any successful sustainability program is buy-in from the corporate level. “It really comes down to whether or not corporate wants to make a commitment and whether they’re going to walk the talk. You need leaders.”
As more food and beverage manufacturers make sustainability a priority, they will not only experience increased processing efficiency and energy savings, but will enjoy the satisfaction of knowing they did the right thing. u
For more information:
John Blanchard, ARC Advisory Group, 781-471-1169, email@example.com
Alex Glass, Nalco Company, 630-848-3344, firstname.lastname@example.org
Ed Binot, The JohnsonDiversey Nalco Alliance, 630-848-3344, email@example.com
Michael Hanschke, JohnsonDiversey, 513-956-2581, firstname.lastname@example.org
Scott Normandeau, Solid Waste Solutions Corp., 207-423-2928, email@example.com
The ultimate in enviro-credThe US Green Building Council’s certification program is the gold standard in sustainable construction.
Five years ago, the number of LEED-certified buildings in the US was just under 40. Today 889 buildings, including food and beverage manufacturing plants, offices, technical centers, laboratories and other types of construction have earned LEED certification, the ultimate in building enviro-cred.
Another 6,800 projects are in the LEED pipeline, combining for more than 1 billion square feet of potential LEED-approved space. To date there are LEED-certified or LEED-pending construction projects in all 50 states and in 24 countries.
The Leadership in Energy and Environmental Design certification is sponsored by the US Green Building Council (www.usgbc.org), founded in 1993 to encourage environmentally sensitive and sustainable building construction. JohnsonDiversey joined USGBC in 2003 and anticipates LEED-certification of its recently opened distribution center in Wisconsin in the coming months. The 550,000-square-foot center, which features water usage at a rate 30 percent below state requirements and energy use at 40 percent below, and substantial use of recycled materials in construction, complements JohnsonDiversey’s headquarters office building, built in 1997, which was one of the first four buildings certified under the LEED for Existing Buildings program in 2004.
In short, LEED is a common standard of measurement for what constitutes a “green” building. It’s kind of a green nutrition label, listing and measuring the kinds of materials used in construction, water and energy efficiency, and the building’s indoor environment-air quality and lighting, for example.
The organization offers on-site workshops as well as online training in sustainable-construction and LEED principles. USGBC’s annual Greenbuild conference and exposition will be held at McCormick Place West in Chicago, IL, from Nov. 7 through 9.
Several bottled-water plants owned by Nestle are LEED-certified, as are some wineries, including pinot-noir specialist Stoller Vineyards in Oregon. Anheuser-Busch’s new technology center in St. Louis is also LEED-certified. Gold-level certification is pending for Kettle Foods’ new snack-chip factory in Beloit, WI. If awarded, it will be the first Gold LEED food manufacturing plant in the US. Pilgrim’s Pride is building a new R&D center at its headquarters in Pittsburg, Texas, with the aim of gaining Silver-level LEED certification.