Go

Breaking News on Supplements & Nutrition - North America EU edition

All feeds

News headlines > Industry

Text size Print Email this page

Special edition: Climate change

US manufacturers might have to play emissions catch-up

By Clarisse Douaud, 13-Jun-2007

Related topics: Industry

The recent G8 meeting in Heiligendamm Germany saw a veering in US rhetoric on climate change that could force food manufacturers to tighten their belts and change their business practices.

President George W Bush last week verbally committed the US to halving emissions by 2050 - although no firm promises have been made. The US is responsible for 25 percent of the world's CO2 emissions and has been the primary obstacle in getting significant global climate change prevention in place.

If the President stands by his word, the time may finally have come for US food manufacturers to start playing catch-up to their European counterparts in preparing for CO2 emissions and trading regulations, so as to avoid negative effects on their bottom line.

While it would seem this might make food manufacturers tremble, some sections of industry are ahead of the game.

"There's been a huge shift in industry opinion in the past few months," Professor Thomas Brewer from the Georgetown McDonough School of Business in Washington DC, told NutraIngredients-USA. "It is now widely recognized that big business is way ahead of the federal government."

Some companies say cutting emissions and saving any way they can makes business sense despite what may be going on at the federal regulatory level.

Novozymes is one such company, with a sustainability platform underpinning all activities at its enzyme facilities in the US, China, Brazil and Denmark.

"It's cheaper to do something now," Karen Oxenboell, Novozymes senior manager for eco-efficiency assessment, told NutraIngredients-USA. "It's becoming more and more costly to do nothing."

As such, nutraceutical manufacturers should begin making their own preparations to reduce harmful emissions. Once business starts realizing this, federal regulators are likely to follow.

"We have our own targets and standards that we should save energy and water," said Oxenboell. "This is not driven by the ambition of meeting regulation, it's simply being a company that would like to contribute to sustainable energy."

The Danish biotechnology group does not foresee having a problem meeting any upcoming regulations in the US. Instead it sees business opportunities for its own operations if food manufacturers start trying to meet stricter targets.

"We are actually developing products that save energy in the processing of foods," said Oxenboell.

Novozymes has developed food enzymes with the potential to save considerable amounts of energy in production.

"For us as a company, it's creating new business if other companies are reducing energy," said Oxenboell.

For companies like this, minimizing harmful emissions and encouraging sustainability is an inevitable choice, regardless of what federal regulations in one country or another require.

Brewer - who specializes in business issues associated with climate change - said that as individual states take it upon themselves to implement regulations, big business is being driven to smooth out this emerging fragmentation of domestic policy.

"So what business is facing is a patchwork of regional, state and local regulations and they want it evened out," said Brewer. "For industry, it reinforces the principle that regulations are inevitable."

The most dramatic change at the state level came last year when California passed bill AB32, set to cut 25 percent of greenhouse gas emissions by 2020 through both caps on emissions and allowances for trading credits between companies.

And if federal regulation eventually sees eye to eye with state movers and shakers, according to Brewer, American companies could find themselves with a stunted capacity to implement change - thereby affecting their international competitiveness.

"The Bush administration did American business a disservice by not falling in line with the climate change issue," opinioned Brewer.

But, based on last week's developments, this policy may be on the verge of shifting course.

Bush was part of a joint G8 statement to the effect that leaders involved would "consider seriously" cutting global emissions by 50 percent by 2050. The G8 includes US, Canada, the United Kingdom, France, Italy, Germany, Russia and Japan.

"In concept, they simply have to begin to be more energy efficient," said Brewer of the industrial and regulatory scene in the US. "Over the long term it creates incentives for them to create more efficient technology."

Still, Brewer is not convinced federal climate change regulations will be imposed any time soon.

"It remains to be seen if the US really changes its policies."