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Managing Corporate Water Footprints
By STEVE SHROPSHIRE
The topic of climate change is putting pressure on companies to operate in an environmentally sustainable manner. This includes managing their “water footprint,” a phrase that was popularized by the late Dutch scientist Arjen Hoekstra in the early 2000s, which means the measure of direct and indirect fresh water used in the production of goods and services.
From Hoekstra came a new scientific discipline dedicated to water and sustainability, and a more intense spotlight on corporate water users. Some have risen to the challenge. Coca-Cola vowed in 2007 to return every drop of water used in its beverages, and last March announced a strategy to achieve “water security” by 2030 “for its business, communities, and nature everywhere the company operates, sources agricultural ingredients for its beverages, and touches people’s lives.”
Yet corporate water usage continues to draw scrutiny. Last summer, the environmental nonprofit CDP launched what it called a “first-of-its-kind tool,” ranking more than 200 industrial activities by their potential impact on water resources. More recently, an article about Intel’s new computer chip-making plant in New Albany, Ohio, noted that just one of Intel’s factories needs more water than a small city.
Much of the recent criticism regarding water footprints has been borne out of the sentiment that companies most often build factories in disadvantaged areas where residents disproportionately suffer consequences of water overuse and misuse. The discussion also is being driven by the recent drought cycle in the Western United States, wildfires, falling water levels — the Colorado River’s flow has declined 20 percent in the last century, and scientists predict another 20 percent drop over the next three decades — and climate change discussions about altered precipitation patterns.
What can corporate water usersdo to address the increased attentionon water use? The best currentoption is offsets — giving back insome way to make up for waterconsumption. This can be done in avariety of ways.
Some companies are making significant donations to nonprofit organizations focused on freshwater ecosystem restoration.One example is the Bonneville Environmental Foundation, which has made purchasing water offsets easy; companies can purchase water restoration certificates for $4apiece online, with the funds going to a diverse portfolio of flow restoration projects. The foundation says75 water restoration certificates are enough to offset water usage by a5,000-square-foot office. Intel, inits own quest to achieve net positive water use by 2030, has funded water sustainability projects throughout the West — reportedly restoring 1.3billion gallons (or about 4,000 acre feet)in 2020 alone.
Some firms are buying environmentalrestoration property orinvesting in new technology andeducation. Coca-Cola teaches sustainableagriculture techniques tosugarcane farmers in India, and hasinvested in transforming and routingwastewater from production to irrigationfor crops in China.
Others are working directlywith conservation organizations onecosystem restoration projects tooffset water-related environmentalimpacts. One example of this is IdahoPower Company’s investment withThe Freshwater Trust to develop theSnake River Stewardship Program.That program is conceived as a50-year effort to undertake watershedrestoration projects in theSnake River basin to improve waterquality.
A company might not be able toprovide a mitigation offset at thelocation of a plant, but they couldconsider an offset at an upstreamtributary. Intel and Amazon haveboth done this. These offsets couldeven be made in neighboring states,so that a California company couldseek offset opportunities in thePacific Northwest.
What are the risks of doing nothing? Although there is little regulatory oversight when it comes to the water footprint, the threat is looming, as is the threat of negative publicity for companies that take no action. Coca-Cola learned this the hard way in India, where it came under attack for allegedly depleting a local water supply. It served as awake-up call for the company.
Today, Coca-Cola enjoys a betterenvironmental reputation in Indiaand other places where it makes beverages.A recent report by FeedingOurselves Thirsty placed Coca-Colafirst among beverage, packaged food,meat and agricultural products companiesfor water management, givingthe company a score of 90.
With concerns about the water footprint rising — and nearly three fourths of companies considering water risks as part of their business planning – the time has never been better to consider business strategies and programs to address sustainable water use.
Steven Shropshire is a shareholder at Jordan Ramis PC, a Pacific Northwest regional law firm. He focuses on water law and environmental regulatory law. He has served as counsel on several cases involving water rights issues of first impression before Oregon, Colorado and federal courts. steve.shropshire@jordanramis.com
