An Emerging Role for Solid Waste Managers
Leading the way to the right "shade of green" for your community
The Obama administration’s emphasis on transforming the economy through major federal funding initiatives is designed to catalyze additional public and private investments in energy, education and public health. One of the most significant examples is the Energy Efficiency and Conservation Block Grant Program (EECBG), originally signed into law with the Energy Bill of 2007 and later funded through an appropriation included in the American Recovery and Reinvestment Act of 2009 (ARRA). The EECBG offers a unique opportunity for local governments to participate in efforts to reduce reliance on fossil fuels and imported oil by developing programs that increase energy efficiency and reduce consumption. In addition, the program is aimed at developing new sources of renewable energy and the reduction of greenhouse gas (GHG) emission.
More than 1,000 cities, counties, and states are eligible for EECBG grants. The funds can cover early planning and feasibility work and/or capital investments associated with specific initiatives ranging from the installation of a solar array on the roof of a bus terminal to the recovery of landfill gas to produce electricity.
Considered by many to have few strings attached, it is tempting to use EECBG dollars to fund easy projects with one-time benefits. Governments would be well advised, however, to reserve some of these funds for more difficult yet high-potential projects that may be hard to fund in terms of early development work. Further, local governments will soon find they need to invest in critical baseline planning to establish more thoughtful and detailed energy and GHG management plans.
“Easy” Money for the “Hard” Things
Emerging waves of federal funding (already apparent in the Omnibus Spending Bill and the framework for the next federal budget) are more likely to be focused on competitive grant processes that will reward those initiatives that make a solid “green” business case. Federal funding agencies are already pointing to the need to furnish significant detail to secure these funds. Early selection criteria include the project’s leverage potential, legacy benefits, jobs (green and traditional or gray jobs), energy and GHG emissions reduction as well as return on investment. No doubt, emerging criteria will require commitments to measure and report progress against energy, water, and GHG baselines and to demonstrate compliance with state-level plans.
The Critical Role
Many cities, counties, and states are not staffed for energy planning and GHG management. Often, the public employees with most expertise in these areas can be found within the ranks of solid waste managers. Managers in Lee County, FL; Lancaster County, PA; the Northeast Maryland Waste Disposal Authority; the cities of Spokane and Tacoma, WA, and Tampa, FL, all have expertise in power generation, energy sales, sophisticated emissions measurement, regulatory management and reporting. They have strong community outreach skills and they know a lot about different fuels, efficiency rates, kilowatts and megawatts, as well as the energy potential that comes from landfill-generated methane and post-recycling leftovers that fuel waste-to-energy plants. Some are exploring opportunities to produce biofuels and energy from solar panels laminated to landfill caps.
The EECBG program presents a unique opportunity for solid waste managers. As leaders in waste diversion, transport, recovery, and disposal, they are well positioned to expand their responsibility by assuming leadership roles as their communities step up to the new requirements for energy and GHG management.
The program calls for specific actions that contribute to a more sustainable future. Solid waste managers are well positioned to help guide local government initiatives. They can begin by leading development of comprehensive energy and GHG management plans. They are naturals to employ planning tactics that leverage local control over solid waste management systems while making considerable gains toward federal goals and objectives. Beyond these initial plans, it is important that they understand that the overarching goal is to use energy efficiency and GHG management to create more sustainable communities, reinforcing local economies with green jobs.
Sustainability will be an increasing theme behind funding programs and federal support. Solid waste managers can be strategic leaders by helping frame local initiatives around sustainability, including learning to think in terms of sustainable return on investment.
Sustainable Positioning With the Triple Bottom Line
There are several ways in which you can make sure your efforts are viewed as sustainable. First, make sure your projects are well-defined. Second, come up with a thorough project delivery plan. Finally, look at how the initiatives will address environmental stewardship, enhance the community, and contribute to economic development.
These three items are often referred to as the “triple bottom line,” and community energy and GHG managers must pay attention to all of them.
Sustainable Solid Waste Facility Examples
One of the best ways to learn is by example, so in this section I will discuss what some industry leaders are doing in the areas of recycling and composting, material recovery facilities (MRFs), transfer stations, and waste-to-energy facilities.
Boulder County, Colorado, Recycling and Composting Facility—This facility recycles 50% of the solid waste generated. It was created under a $13 million design-build contract. The MRF processes 75,000 tons per year. It has been functioning at capacity since opening in July 2001. Sustainable features include high-performance glazing, high R-valve in the walls and roof, and high-efficiency mechanical equipment. Daylighting was incorporated throughout the building, including Kalwall clerestories in the processing plant and office areas and lightpipes in the restrooms. The LEED rating system was used as a framework, and the facility achieved the LEED Silver rating.
This project illustrates benefits to the triple bottom line. Environmental benefits include use of low-impact materials with a high recycling content. Recyclable materials are packaged and processed onsite. Yardwaste is collected and composted into a beneficial-use project. Social benefits include turning a brownfield site into a beneficial community facility, reduced cooling loads through natural ventilation, and community education programs offered onsite. Economic benefits are realized through daylighting, high-performance glazing, and high-efficiency HVAC and electrical light systems.
Los Angeles County Sanitation District, Puente Hills Waste Management System—The district’s facilities include a 4,000-tons-per-day waste transfer station and 210,000 square-foot MRF, along with a maintenance facility and administrative facility. The landfill-gas-to-energy facility produces 50 MW (gross) of power, equivalent to the energy requirements of approximately 70,000 homes.
Sustainable features start with facility design. The facilities were built with efficiency and adaptability in mind. Other features include daylighting strategies, use of recycled materials, using reclaimed water for landscaping and other nonpotable water needs, and designated truck loading areas to minimize impacts of dust, odor and noise.
Environmental benefits come from such recycling materials as translucent panels, steel, carpeting, and backing. Aesthetic concerns were met by designing the facilities so the buildings blend in with their surroundings. The administrative building conceals the production center, with trucks unloading inside the production facility. Five hundred skylights were used to reduce demand for artificial lighting.
This system shows how sustainability and other benefits are not mutually exclusive. Sustainable features such as using reclaimed water, and environmentally savvy tactics such as designing a facility that fits within its surroundings, benefit the community as well as the environment.
Economic benefits include minimal electricity consumption through use of high-efficiency air conditioning, lighting systems and sensors. The MRF-transfer station’s energy efficiency earned a $75,000 credit from utilities. The system was designed with future needs in mind, and a cost-benefit analysis was performed to determine the risk associated with either a two-phase build or full-capacity build. Based on the analysis, the full-capacity build was selected.
Salinas Valley Solid Waste Authority Economic and Environmental Modeling—The authority comprises the California cities of Salinas, Greenfield, King City, and Soledad, along with eastern areas of unincorporated Monterey County. The goal of this plan was a 75% reduction in landfill waste by 2015, and a 50-year sustainable waste-processing and disposal capacity. Sustainable waste management concepts in the model include landfill gas recovery with conversion electricity, autoclaving solid waste materials to recoverable materials for energy production or recycling, greenhouse gas impact modeling, and MRF and efficient landfill design.
Environmental benefits include reduced landfill disposal, material recovery and recycling, and reduced methane and vehicle emissions. Social benefits include involving the community in “green” reuse and recycling activities and job creation. Economic benefits were realized through use of sustainable design concepts, which will decrease operating costs over the system’s projected life.
City of Phoenix North Transfer Station and MRF—The North Gateway Campus in Phoenix, AZ, is a 450-acre, $40 million campus. Forty-three acres are devoted to the North Transfer Station and 180,000-square-foot MRF, which process 4,000 tons of solid waste per day.
Sustainable and environmentally beneficial features include constructing the NTS-MRF between native desert floodplains with a minimal footprint and profile evoking the desert landscape. Broad, low structures were intended to resemble neighboring mesas, with building colors carefully matched to blend with the environment. Displaced native plants, including the protected saguaro cactus, were relocated to preserve the surrounding habitat and reduce the amount of water needed by non-native plants. The facility uses a solar grid to generate power for lighting exteriors, which also feature long roof overhangs to provide shade and cooling. Highly reflective roof paint minimizes heat radiation and improves HVAC performance. More than 90% of the structural steel used on the NTS-MRF is recycled.
Social benefits included an early community planning workshop, public education provisions (including a viewing gallery and tours), designing the building to blend in with its natural surroundings, and separating the bridges and access road by types of use.
Economic benefits have been realized through reduced electricity use, which was accomplished through use of daylighting, reflective paint and roof overhangs, translucent wall panels and skylights. The solar panel grid on the roof produces enough energy to serve four or five houses. Economic benefits have been realized through the sale of recycled materials. Revenues of $13.5 million are expected over three years.
Lee County, Florida, Waste-to-Energy and Resource Recovery Facility—Lee County was an early leader in converting solid waste into renewable energy. Its recent 636-ton-per-day expansion project was the first new WTE facility permitted in the 21st century and was named 2008 Project of the Year in the renewable energy category by a leading power trade publication. The WTE facility sells renewable energy credits. The MRF recycles aluminum and metals and will convert to single-stream recycling in the near future. The facility uses photovoltaics to offset energy use.
Measuring Green
Both ARRA and the EECBG program emphasize sustainable solutions. You can talk about green all you want, but you have to be able to make a solid business case to obtain project funding. Having a set of metrics you can use to create this case is the best way to obtain funding and make sure you spend the money wisely and well. By determining the sustainable return on investment, or SROI, communities can determine how to get the most bang for their buck when funding projects, both EECBG projects and others.
But how do you measure “green?” The same way you measure whether to construct a WTE facility or transfer station: by weighing the benefits against the costs and incorporating risk assessment. Only this time, you assign monetary values to social aspects as well as economic ones, engaging stakeholders throughout the process to validate variable inputs and build consensus regarding outcomes.
A Tool for Public Decisions
Selecting the right shade of green for a community involves balancing risks and rewards in a way that matches stakeholder expectations. Economic evaluation tools and processes can guide communities through a decision-making process that will help them select the shade of green that works best for them.
Measuring SROI means examining the entire scope of potential costs and benefits related to sustainability measures, while simultaneously incorporating a risk analysis component over the project’s life cycle. These include traditional inputs, such as savings on utility bills or reduced O&M costs, but also inputs such as quantifying the environmental savings from reduced carbon emissions, or the enhanced productivity of employees working in a green building (e.g., taking fewer sick days).
SROI includes criteria for committing public resources, expanded decision metrics, risk/benefit analysis, green business case outcomes, and assessment of benefits, including cash and noncash and the value of externalities described in monetary terms.
Developing criteria for public decisions is a cornerstone of this approach. This “real time” green business-case-evaluation process evaluates the economic and social value of any opportunity. It accounts for risk and uncertainty and engages stakeholders. It facilitates decision making when there is uncertainty by answering key questions:
- Which opportunities are viable?
- What is the value of each opportunity?
- What is the probability of a positive return for each opportunity?
- What are the break-even values of the critical variables?
The SROI process uses a mathematical model to analyze probabilities related to a project’s environmental, social, and economic values, including stakeholder input to validate the variables that are used to calculate values. In step two of the process, all the variables that were selected in the initial analysis are quantified and given a monetary value.
Introducing the Sustainability “S” Curve
Figure 1 is an SROI graph for an example focused on a proposed airport expansion. The blue curve in the graph reflects traditional cash return on investment the airport would generate from new fees and other benefits, with a mean return on investment of six percent. However, if the airport integrated non-cash benefits such as improved productivity, it would result in increased ROI represented by the brown curve. Such community costs as increased noise are weighed against benefits such as shorter wait times and increased economic activity. The benefits outweigh the costs, creating a positive net present value.
This graph shows how the traditional ROI evaluation falls short of reporting a project’s true impacts and benefits. The differences between the financial ROI (blue curve) and sustainable ROI (green curve) is the value of “green.” In this case, the mean sustainable return on investment is a robust 40%. Beyond the airport expansion example provided here, SROI has been applied at local, state, and federal levels of government in the US and Canada, in the utility industry, for building and infrastructure development, and the management of large-scale natural resources.
Guiding Your Community to the Right Shade of Green
Successful project implementation means measuring, reporting and revising as you go. I call this “SHADE,” which stands for:
- See today’s situation and set priorities.
- Have a focus on what matters most.
- Ask your stakeholders to collaborate.
- Decide on strategies.
- Evaluate your progress and adjust your plan.
Seeing today’s situation means asking yourself what stakeholder expectations are and acting accordingly. Group projects into those that should be implemented, profitable projects that lack funding, and projects that are not worth pursuing.
It’s important to focus on what matters. What will influence your decisions? Criteria for committing public resources include the return on investment, resilience (how well the solution will hold up), carbon reduction, green jobs creation, functionality, and deliverability.
No one shade of green will fit every community—enlist stakeholder collaboration, to learn where you should focus your attention. Some organizations are more focused on water use, some on renewable energy and others on minimizing waste or maximizing mobility. The steps I’ve discussed in this article will help communities decide which shade is best for their unique circumstances.
The next step is to decide on strategies, with a combination of strategies typically the key to success. This is where you zero in on which process should be used for your project. Steps leading to successful project implementation include:
- defining the challenge;
- creating a baseline footprint;
- identifying the most important metrics;
- reviewing the best alternatives;
- assessing the risks and benefits;
- testing assumptions and ranking;
- developing program and schedule; and
- implementing.
The final, ongoing step is to evaluate your progress and adjust your plan accordingly. How can you accelerate the process? By increasing cooperation and reducing opposition, specifically by using objective metrics and transparent analysis, offering a risk/management perspective and collaborating with your stakeholders. The consensus-driven decisions you arrive at will guide your project to its successful conclusion.
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Solid Waste Managers Can Make It Happen
Solid waste managers are already on the forefront of waste diversion, transport, recovery, and disposal. If you haven’t already, it’s time to start thinking of yourself as an energy and carbon manager as well, and to become familiar or at least aware of the variety of sustainable strategies involving solid waste, air, water, land, buildings, transportation/mobility, and energy. Carbon, health and productivity, and green jobs should now also be in the considered set for most projects, particularly those that may qualify for federal funding under the EECBG program.
The EECBG program represents a grassroots call to action in that solutions are driven from local governments. There is a need for leadership as the program is implemented, and solid waste managers can leverage their knowledge and track records to take leadership positions relative to energy and GHG management in the communities they serve.
Author's Bio: Author John F. Williams is a senior vice president with HDR in its White Plains, NY, office.
November - December 2009
An Emerging Role for Solid Waste Managers
Leading the way to the right "shade of green" for your community
The Obama administration’s emphasis on transforming the economy through major federal funding initiatives is designed to catalyze additional public and private investments in energy, education and public health. One of the most significant examples is the Energy Efficiency and Conservation Block Grant Program (EECBG), originally signed into law with the Energy Bill of 2007 and later funded through an appropriation included in the American Recovery and Reinvestment Act of 2009 (ARRA). The EECBG offers a unique opportunity for local governments to participate in efforts to reduce reliance on fossil fuels and imported oil by developing programs that increase energy efficiency and reduce consumption. In addition, the program is aimed at developing new sources of renewable energy and the reduction of greenhouse gas (GHG) emission.
More than 1,000 cities, counties, and states are eligible for EECBG grants. The funds can cover early planning and feasibility work and/or capital investments associated with specific initiatives ranging from the installation of a solar array on the roof of a bus terminal to the recovery of landfill gas to produce electricity.
Considered by many to have few strings attached, it is tempting to use EECBG dollars to fund easy projects with one-time benefits. Governments would be well advised, however, to reserve some of these funds for more difficult yet high-potential projects that may be hard to fund in terms of early development work. Further, local governments will soon find they need to invest in critical baseline planning to establish more thoughtful and detailed energy and GHG management plans.
“Easy” Money for the “Hard” Things
Emerging waves of federal funding (already apparent in the Omnibus Spending Bill and the framework for the next federal budget) are more likely to be focused on competitive grant processes that will reward those initiatives that make a solid “green” business case. Federal funding agencies are already pointing to the need to furnish significant detail to secure these funds. Early selection criteria include the project’s leverage potential, legacy benefits, jobs (green and traditional or gray jobs), energy and GHG emissions reduction as well as return on investment. No doubt, emerging criteria will require commitments to measure and report progress against energy, water, and GHG baselines and to demonstrate compliance with state-level plans.
The Critical Role
Many cities, counties, and states are not staffed for energy planning and GHG management. Often, the public employees with most expertise in these areas can be found within the ranks of solid waste managers. Managers in Lee County, FL; Lancaster County, PA; the Northeast Maryland Waste Disposal Authority; the cities of Spokane and Tacoma, WA, and Tampa, FL, all have expertise in power generation, energy sales, sophisticated emissions measurement, regulatory management and reporting. They have strong community outreach skills and they know a lot about different fuels, efficiency rates, kilowatts and megawatts, as well as the energy potential that comes from landfill-generated methane and post-recycling leftovers that fuel waste-to-energy plants. Some are exploring opportunities to produce biofuels and energy from solar panels laminated to landfill caps.
The EECBG program presents a unique opportunity for solid waste managers. As leaders in waste diversion, transport, recovery, and disposal, they are well positioned to expand their responsibility by assuming leadership roles as their communities step up to the new requirements for energy and GHG management.
The program calls for specific actions that contribute to a more sustainable future. Solid waste managers are well positioned to help guide local government initiatives. They can begin by leading development of comprehensive energy and GHG management plans. They are naturals to employ planning tactics that leverage local control over solid waste management systems while making considerable gains toward federal goals and objectives. Beyond these initial plans, it is important that they understand that the overarching goal is to use energy efficiency and GHG management to create more sustainable communities, reinforcing local economies with green jobs.
Sustainability will be an increasing theme behind funding programs and federal support. Solid waste managers can be strategic leaders by helping frame local initiatives around sustainability, including learning to think in terms of sustainable return on investment.
Sustainable Positioning With the Triple Bottom Line
There are several ways in which you can make sure your efforts are viewed as sustainable. First, make sure your projects are well-defined. Second, come up with a thorough project delivery plan. Finally, look at how the initiatives will address environmental stewardship, enhance the community, and contribute to economic development.
These three items are often referred to as the “triple bottom line,” and community energy and GHG managers must pay attention to all of them.
Sustainable Solid Waste Facility Examples
One of the best ways to learn is by example, so in this section I will discuss what some industry leaders are doing in the areas of recycling and composting, material recovery facilities (MRFs), transfer stations, and waste-to-energy facilities.
Boulder County, Colorado, Recycling and Composting Facility—This facility recycles 50% of the solid waste generated. It was created under a $13 million design-build contract. The MRF processes 75,000 tons per year. It has been functioning at capacity since opening in July 2001. Sustainable features include high-performance glazing, high R-valve in the walls and roof, and high-efficiency mechanical equipment. Daylighting was incorporated throughout the building, including Kalwall clerestories in the processing plant and office areas and lightpipes in the restrooms. The LEED rating system was used as a framework, and the facility achieved the LEED Silver rating.
This project illustrates benefits to the triple bottom line. Environmental benefits include use of low-impact materials with a high recycling content. Recyclable materials are packaged and processed onsite. Yardwaste is collected and composted into a beneficial-use project. Social benefits include turning a brownfield site into a beneficial community facility, reduced cooling loads through natural ventilation, and community education programs offered onsite. Economic benefits are realized through daylighting, high-performance glazing, and high-efficiency HVAC and electrical light systems.
Los Angeles County Sanitation District, Puente Hills Waste Management System—The district’s facilities include a 4,000-tons-per-day waste transfer station and 210,000 square-foot MRF, along with a maintenance facility and administrative facility. The landfill-gas-to-energy facility produces 50 MW (gross) of power, equivalent to the energy requirements of approximately 70,000 homes.
Sustainable features start with facility design. The facilities were built with efficiency and adaptability in mind. Other features include daylighting strategies, use of recycled materials, using reclaimed water for landscaping and other nonpotable water needs, and designated truck loading areas to minimize impacts of dust, odor and noise.
Environmental benefits come from such recycling materials as translucent panels, steel, carpeting, and backing. Aesthetic concerns were met by designing the facilities so the buildings blend in with their surroundings. The administrative building conceals the production center, with trucks unloading inside the production facility. Five hundred skylights were used to reduce demand for artificial lighting.
This system shows how sustainability and other benefits are not mutually exclusive. Sustainable features such as using reclaimed water, and environmentally savvy tactics such as designing a facility that fits within its surroundings, benefit the community as well as the environment.
Economic benefits include minimal electricity consumption through use of high-efficiency air conditioning, lighting systems and sensors. The MRF-transfer station’s energy efficiency earned a $75,000 credit from utilities. The system was designed with future needs in mind, and a cost-benefit analysis was performed to determine the risk associated with either a two-phase build or full-capacity build. Based on the analysis, the full-capacity build was selected.
Salinas Valley Solid Waste Authority Economic and Environmental Modeling—The authority comprises the California cities of Salinas, Greenfield, King City, and Soledad, along with eastern areas of unincorporated Monterey County. The goal of this plan was a 75% reduction in landfill waste by 2015, and a 50-year sustainable waste-processing and disposal capacity. Sustainable waste management concepts in the model include landfill gas recovery with conversion electricity, autoclaving solid waste materials to recoverable materials for energy production or recycling, greenhouse gas impact modeling, and MRF and efficient landfill design.
Environmental benefits include reduced landfill disposal, material recovery and recycling, and reduced methane and vehicle emissions. Social benefits include involving the community in “green” reuse and recycling activities and job creation. Economic benefits were realized through use of sustainable design concepts, which will decrease operating costs over the system’s projected life.
City of Phoenix North Transfer Station and MRF—The North Gateway Campus in Phoenix, AZ, is a 450-acre, $40 million campus. Forty-three acres are devoted to the North Transfer Station and 180,000-square-foot MRF, which process 4,000 tons of solid waste per day.
Sustainable and environmentally beneficial features include constructing the NTS-MRF between native desert floodplains with a minimal footprint and profile evoking the desert landscape. Broad, low structures were intended to resemble neighboring mesas, with building colors carefully matched to blend with the environment. Displaced native plants, including the protected saguaro cactus, were relocated to preserve the surrounding habitat and reduce the amount of water needed by non-native plants. The facility uses a solar grid to generate power for lighting exteriors, which also feature long roof overhangs to provide shade and cooling. Highly reflective roof paint minimizes heat radiation and improves HVAC performance. More than 90% of the structural steel used on the NTS-MRF is recycled.
Social benefits included an early community planning workshop, public education provisions (including a viewing gallery and tours), designing the building to blend in with its natural surroundings, and separating the bridges and access road by types of use.
Economic benefits have been realized through reduced electricity use, which was accomplished through use of daylighting, reflective paint and roof overhangs, translucent wall panels and skylights. The solar panel grid on the roof produces enough energy to serve four or five houses. Economic benefits have been realized through the sale of recycled materials. Revenues of $13.5 million are expected over three years.
Lee County, Florida, Waste-to-Energy and Resource Recovery Facility—Lee County was an early leader in converting solid waste into renewable energy. Its recent 636-ton-per-day expansion project was the first new WTE facility permitted in the 21st century and was named 2008 Project of the Year in the renewable energy category by a leading power trade publication. The WTE facility sells renewable energy credits. The MRF recycles aluminum and metals and will convert to single-stream recycling in the near future. The facility uses photovoltaics to offset energy use.
Measuring Green
Both ARRA and the EECBG program emphasize sustainable solutions. You can talk about green all you want, but you have to be able to make a solid business case to obtain project funding. Having a set of metrics you can use to create this case is the best way to obtain funding and make sure you spend the money wisely and well. By determining the sustainable return on investment, or SROI, communities can determine how to get the most bang for their buck when funding projects, both EECBG projects and others.
But how do you measure “green?” The same way you measure whether to construct a WTE facility or transfer station: by weighing the benefits against the costs and incorporating risk assessment. Only this time, you assign monetary values to social aspects as well as economic ones, engaging stakeholders throughout the process to validate variable inputs and build consensus regarding outcomes.
A Tool for Public Decisions
Selecting the right shade of green for a community involves balancing risks and rewards in a way that matches stakeholder expectations. Economic evaluation tools and processes can guide communities through a decision-making process that will help them select the shade of green that works best for them.
Measuring SROI means examining the entire scope of potential costs and benefits related to sustainability measures, while simultaneously incorporating a risk analysis component over the project’s life cycle. These include traditional inputs, such as savings on utility bills or reduced O&M costs, but also inputs such as quantifying the environmental savings from reduced carbon emissions, or the enhanced productivity of employees working in a green building (e.g., taking fewer sick days).
SROI includes criteria for committing public resources, expanded decision metrics, risk/benefit analysis, green business case outcomes, and assessment of benefits, including cash and noncash and the value of externalities described in monetary terms.
Developing criteria for public decisions is a cornerstone of this approach. This “real time” green business-case-evaluation process evaluates the economic and social value of any opportunity. It accounts for risk and uncertainty and engages stakeholders. It facilitates decision making when there is uncertainty by answering key questions:
- Which opportunities are viable?
- What is the value of each opportunity?
- What is the probability of a positive return for each opportunity?
- What are the break-even values of the critical variables?
The SROI process uses a mathematical model to analyze probabilities related to a project’s environmental, social, and economic values, including stakeholder input to validate the variables that are used to calculate values. In step two of the process, all the variables that were selected in the initial analysis are quantified and given a monetary value.
Introducing the Sustainability “S” Curve
Figure 1 is an SROI graph for an example focused on a proposed airport expansion. The blue curve in the graph reflects traditional cash return on investment the airport would generate from new fees and other benefits, with a mean return on investment of six percent. However, if the airport integrated non-cash benefits such as improved productivity, it would result in increased ROI represented by the brown curve. Such community costs as increased noise are weighed against benefits such as shorter wait times and increased economic activity. The benefits outweigh the costs, creating a positive net present value.
This graph shows how the traditional ROI evaluation falls short of reporting a project’s true impacts and benefits. The differences between the financial ROI (blue curve) and sustainable ROI (green curve) is the value of “green.” In this case, the mean sustainable return on investment is a robust 40%. Beyond the airport expansion example provided here, SROI has been applied at local, state, and federal levels of government in the US and Canada, in the utility industry, for building and infrastructure development, and the management of large-scale natural resources.
Guiding Your Community to the Right Shade of Green
Successful project implementation means measuring, reporting and revising as you go. I call this “SHADE,” which stands for:
- See today’s situation and set priorities.
- Have a focus on what matters most.
- Ask your stakeholders to collaborate.
- Decide on strategies.
- Evaluate your progress and adjust your plan.
Seeing today’s situation means asking yourself what stakeholder expectations are and acting accordingly. Group projects into those that should be implemented, profitable projects that lack funding, and projects that are not worth pursuing.
It’s important to focus on what matters. What will influence your decisions? Criteria for committing public resources include the return on investment, resilience (how well the solution will hold up), carbon reduction, green jobs creation, functionality, and deliverability.
No one shade of green will fit every community—enlist stakeholder collaboration, to learn where you should focus your attention. Some organizations are more focused on water use, some on renewable energy and others on minimizing waste or maximizing mobility. The steps I’ve discussed in this article will help communities decide which shade is best for their unique circumstances.
The next step is to decide on strategies, with a combination of strategies typically the key to success. This is where you zero in on which process should be used for your project. Steps leading to successful project implementation include:
- defining the challenge;
- creating a baseline footprint;
- identifying the most important metrics;
- reviewing the best alternatives;
- assessing the risks and benefits;
- testing assumptions and ranking;
- developing program and schedule; and
- implementing.
The final, ongoing step is to evaluate your progress and adjust your plan accordingly. How can you accelerate the process? By increasing cooperation and reducing opposition, specifically by using objective metrics and transparent analysis, offering a risk/management perspective and collaborating with your stakeholders. The consensus-driven decisions you arrive at will guide your project to its successful conclusion.
Solid Waste Managers Can Make It Happen
Solid waste managers are already on the forefront of waste diversion, transport, recovery, and disposal. If you haven’t already, it’s time to start thinking of yourself as an energy and carbon manager as well, and to become familiar or at least aware of the variety of sustainable strategies involving solid waste, air, water, land, buildings, transportation/mobility, and energy. Carbon, health and productivity, and green jobs should now also be in the considered set for most projects, particularly those that may qualify for federal funding under the EECBG program.
The EECBG program represents a grassroots call to action in that solutions are driven from local governments. There is a need for leadership as the program is implemented, and solid waste managers can leverage their knowledge and track records to take leadership positions relative to energy and GHG management in the communities they serve.