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Subaru and AdoptAClassroom.org to Support Over 750,000 Students Across the U.S.

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Teachers in the United States are spending more of their own money than ever before to meet an overwhelming need for even basic school supplies like paper and pencils. They spent an average of $860 on classroom supplies in the 2022-2023 school year, a 44 percent increase since 2015, according to AdoptAClassroom.org surveys. That’s largely because funding for classroom supply budgets have not kept up to meet students’ needs. 

Over the past four years, Subaru of America has partnered with AdoptAClassroom.org to help reduce this financial burden. Donors and corporate sponsors can “adopt” a specific classroom by donating on the fundraising platform. Teachers use the money for supplies, designing and developing the classroom environment, and incorporating modern educational technologies and materials for new teaching methods.

The Subaru journey into educational support began with a shared vision. “It started with a simple introduction to AdoptAClassroom.org, which turned into a powerful collaboration under our Subaru Loves Learning initiative,” said Lauren Papasidero, Love Promise Community Commitment Specialist at Subaru of America. “Our goal was clear from the beginning — we wanted to ensure that every student had the necessary tools for success, irrespective of their economic background. As of this year, we will have helped over 750,000 students nationwide.”

Subaru of America is headquartered in Camden, New Jersey, and over the past four years the company has adopted every grade school and every high school in the city’s public school district.. “Through our partnership, we have helped set up their classrooms, we provided a graphic arts lab to one high school, and we assist them with any task they need,” Papasidero said. “We also ask Subaru of America colleagues to spend a day volunteering and supporting teachers at schools throughout the entire Camden City School District.”

Before partnering with AdoptAClassroom.org, Subaru was working hard to align the national scope of its educational support program with local impact needs. It’s crucial that the company’s more than 630 automotive retailers can support high-needs schools within their local communities. The solution was coordinating with AdoptAClassroom.org to match each retailer with a nearby school in need, while navigating complexities such as pre-existing relationships with non-eligible schools. Subaru then encouraged retailers to consistently partner with the same schools to foster long-term relationships and maximize impact.

“This year, we have 78 percent of our retailers partnering with the same school for the fourth consecutive year,” Papasidero said. “While it was a hurdle in the beginning — how can we execute locally when we're national? — I'm proud to say we have overcome that challenge and now have relationships in every local community. AdoptAClassroom.org helped us foster these relationships and grow them, and our retailers have really taken it and run with it.”

Reflecting on the broader impact highlights the effectiveness of the partnership, but also illustrates the deep-seated needs that persist in educational institutions across the country. “Ninety-two percent of teachers reported that our contributions significantly increased access to essential educational materials,” Papasidero said. 

The flexible funding that Subaru provides offers teachers the opportunity to get what they need most for their classrooms. And on top of that, Subaru retailers are always encouraged to go above and beyond in their efforts to make a difference. 

“One of our retailers learned that many students go home without access to electricity, so they were unable to charge their devices,” Papasidero said. “The students would come in the morning with little to no battery on their devices, so they weren't able to participate in their educational activities. When we contacted AdoptAClassroom.org, we learned that the school was interested in purchasing charging carts, but had budget restrictions. So, team Subaru stepped up and, through AdoptAClassroom.org, donated over 35 charging carts to this school, providing every student in the classroom access to electricity.”

Creating an internship program for local special education graduates is another example of a Subaru retailer thinking outside the box. “They learn real-world business skills and how to work in a professional setting, but in a nurturing environment,” Papasidero said. “And what’s more, last year's intern was hired on full-time after their internship.” 

The synergy between Subaru and AdoptAClassroom.org is a testament to the power of collaborative philanthropy. As companies like Subaru step up to address societal challenges, their actions set a precedent for how corporate entities can make a difference.

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U.S. teachers are spending more of their own money than ever before to meet an overwhelming need for even basic school supplies like paper and pencils. Over the past four years, Subaru of America has partnered with AdoptAClassroom.org to help reduce this financial burden.
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Laws Whiskey House is Promoting Water Conservation in Colorado

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Whiskey isn’t called the water of life for nothing. These two elements are inextricably connected. Whiskey is about 60 percent water, with the water quality influencing the flavor, aroma and mouthfeel of whiskey. Then there’s the practical side of things. Water is used throughout the distillation process for cleaning grains, extracting sugar for fermentation and achieving the desired alcoholic strength. 

Unfortunately, this key ingredient is dwindling in some top areas for whiskey. The Western United States is grappling with water shortages tied to the Colorado River. And two of the largest American reservoirs, Lake Mead and Lake Powell, are reaching dangerously low levels. 

Denver-based Laws Whiskey House is wading into this watery dilemma. With the recent launch of its Headwater Series, they’re raising awareness of Colorado’s many rivers and promoting conservation efforts. Fittingly, the first whiskey in the series, a four grain bourbon, is dedicated to the Colorado River. In a region plagued by drought, this distillery is striving to make a difference.

Water woes on the Colorado

The Colorado River is a veritable powerhouse of the West, providing irrigation water across 5.5 million acres of ranch and farmland and drinking water to 40 million people in cities like Los Angeles, Denver and Phoenix. This water supports an estimated $1.43 trillion in economic output and 16 million jobs in the U.S. each year. 

This 1,400-mile-long river is also crucial for the environment. Along with its tributaries, it supports an array of biodiversity, including bears, elk, moose, big horn sheep and several threatened fish species. Millions of migratory birds use the basin as a stopover site in fall and spring, too. 

But this valuable river system is in trouble. Climate change has reduced its flow by more than the storage capacity of Lake Mead since 2000. The nonprofit American Rivers listed the Colorado as America’s most endangered river system last year. 

“Water is obviously one of the building blocks of life,” said Peyton Mason, chief financial officer at Laws Whiskey House. “In Colorado and the West in general, it's come under intense scrutiny — how we use water, and how we interact with it on a daily basis.”

While increased precipitation in the coming decades could offset some of the river’s losses from climate change, there wasn’t really enough to go around in the first place. That’s because the river’s water is overconsumed, barely reaching its historic ending point, the Sea of Cortez.

The future of the river basin is at a crossroads. Seven U.S. states, two Mexican states, and 30 Native American tribes are currently negotiating how to divvy up the Colorado River's water, including water use cuts. 

Feeding the Colorado River

Laws Whiskey House’s Headwaters Series is addressing the issue with notes of orange peel and spice.

“This was a way for us to kind of shine a light on that,” Mason said. “There's a lot of problems and we, as a small craft distillery, are not going to be able to solve all those.  We're not ignorant to that. But one thing we can do is help connect people and bring awareness to certain causes, and that was the goal with the Headwater Series.”

Besides raising awareness, the series also supports water conservation. Ten percent of the sales from the Headwaters Series bourbon is given to Shoshone Water Right Preservation. This group of stakeholders aims to permanently protect a water right — the legal right to use, manage or sell water —  on the Colorado River. The water right is tied to a hydroelectric power plant that uses the river water to generate power. 

“It's very unique water for several reasons,” Mason said. “One, it's non-consumptive. So they're taking the water out, but then they're putting it back in. Obviously, that's a really good thing because you're not taking it out permanently. Number two, it's one of the largest rights on the river.”

The coalition aims to buy the water right and extend a permanent lease to the power plant. If they succeed, 1.02 million acre-feet of water would benefit the river and its many users each year.

Laws Whiskey House also partners with and sponsors Running Rivers, a Colorado-based nonprofit focused on conserving and restoring lakes, streams and creeks important for native fish.

A bottle of the 2024 edition of the Headwater Series from Laws Whiskey House.
The first installment of the Headwater Series, a four grain bourbon, supports water conservation efforts on the Colorado River. (Image courtesy of Laws Whiskey House.) 

Laws Whiskey House’s efficient approach

In addition to helping the wider world of water, Laws Whiskey House promotes sustainability in its own operations. 

“We did a big expansion in 2021 where we were able to reconfigure a lot of our equipment to be more efficient,” Mason said. “We now have a closed loop water system … We're bringing in water and we're reusing that water throughout the process so that we're not using it for one thing and then dumping it down a drain.”

These efforts matter since distilleries use a lot of water — nearly 29 liters for each liter of spirits produced. The closed-loop system saves Laws Whiskey House 325,000 gallons each year when operating at full capacity. 

In addition to saving water, this recycling system also reduces energy costs. For instance, making whiskey involves cooking the grains, or malt, and adding yeast to the cooled mixture for fermentation.

“In whiskey, you're heating things up and then you have to cool it down rather quickly,” Mason said. “We'll take water that's been cooled through a chiller or groundwater, depending on what we need, and then we use that to cool down something else. So in the process of cooling down, say, our cooker, it's going to heat up that water … We then will save that hot water and use it to heat up the next batch. So we're reducing the amount of energy needed to heat and cool things.” 

Similar to water consumption, distilleries have ample room to reduce their energy use. Large operations can burn through the same amount as 7,000 homes annually. 

Whiskey’s waste

Laws Whiskey House is also tackling a less savory side of whiskey: wastewater. Distillation is a wasteful exercise, producing 12 times as much wastewater as alcohol. Plus, it’s full of organic matter. Laws Whiskey House has a unique approach to this problem. Its wastewater goes to a wastewater treatment plant near the distillery. It’s added to the treatment process for waste from the city. 

One of the steps in cleaning wastewater uses methanol, which is an expensive oil and gas by-product, Mason said. The distillery’s wastewater already contains some methanol.

“We can send them our wastewater and help offset the use of methanol for them,” Mason said. “So they're not having to truck it in. They're not having to burn fossil fuels to get it … It's taking something that would have otherwise been thrown away, or a waste product for us, and then repurposing it to help clean up the city's water.”

While this partnership is in the pilot phase, the organizations are presenting the results for final approval. 

Water and whiskey

Colorado is well known for its craft beer scene, but it’s also a booming market for spirits. Over 110 craft distilleries support more than 24,200 employees in the state, generating $7.5 billion in sales. Yet none of this would be possible without abundant water. Unfortunately, water shortages aren’t unique to the Colorado River or likely to improve in the near future.

Laws Whiskey House plans to release a new Headwater Series whiskey each year, benefiting a different river. With the headwaters of multiple major river basins in Colorado, it has ample choices for a conservation spotlight. 

“We'd rather do something and be a part of helping out the change,” Mason said. “This is our avenue for doing that in the world that we live in.”

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Water is a key ingredient in whiskey, but many distilleries are located in areas grappling with water shortages. Denver-based Laws Whiskey House is striving to make a difference with a new whiskey series dedicated to supporting water conservation efforts in nearby rivers, starting with the Colorado.
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Wind Maps and Rice Terraces: How Cities Adapt to Climate Change

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This story about urban climate change adaptation is part of The Solutions Effect, a monthly newsletter covering the best of solutions journalism in the sustainability and social impact space. If you aren't already getting this newsletter, you can sign up here.

Urban areas sit at a critical crossroads of climate change. Cities are known for their significant contribution to global greenhouse gas emissions, unsustainable sprawl and resource consumption. Yet their locations — often on coasts or floodplains — and tendency to trap heat make them especially vulnerable to climate impacts. 

More than half of the people on the planet live in cities, and that number is rising fast. The worsening effects of climate change and more people moving in, including many already displaced by climate-related disasters, can increase existing social and economic inequalities. 

All of this reduces urban livability, making adaptation and mitigation vital for the safety of city residents and the city's future. This position pushes urban areas to become incubators for innovative climate solutions. Cities around the world are finding new ways to adapt to their unique challenges while reducing their overall impact. 

For climate adaptation to be successful, cities should focus on two categories: systemic-resilience actions and hazard-specific actions, according to a report from the consulting firm McKinsey & Co. and C40 Cities, a global network of mayors addressing climate change. Systemic-resilience actions broadly improve a city’s ability to adapt and decrease risks, like considering climate risk in urban planning or building early warning systems. 

Using artificial intelligence-powered digital twins to assess risks and test whether sustainable development plans are effective is a systemic-resilience approach gaining traction globally. These twins are accurate virtual models of a city that use real-time data to simulate scenarios and offer predictions. Singapore uses a digital twin to plan green infrastructure projects like increasing shade by planting trees, as TriplePundit recently reported. Similarly, Mendoza, Argentina, uses the same software to keep track of the health of its 1 million trees and plan proactive maintenance. 

Enhancing the programs that finance adaptation projects is another systemic-resilience action cities can take. For example, Philadelphia’s Build to Last program recently received city funding for the first time. It offers repairs and sustainable upgrades for low-income homeowners to “future-proof” their homes with upgrades like heat pumps that cool homes during heat waves instead of air conditioning to reduce emissions and lower utility bills. 

The Philadelphia program steps closer to the second part of a successful adaptation plan, hazard-specific actions. These approaches focus on addressing a distinct problem, like making water infrastructure more efficient amid a drought or building flood-resilient buildings. 

The architects across Asia taking inspiration from traditional rice farms to prevent flooding are one example. In Bangkok, the roof of Thammasat University mimics rice terraces, a farming practice that’s thousands of years old. Small ponds stacked like a staircase allow water to cascade down and collect on the roof. The roof is actually used to grow rice, so when it’s dry, the university uses clean energy to circulate the water and irrigate the crops. It’s estimated to slow the excess rainwater that flows to the ground by 20 times compared to a concrete roof and it keeps the building several degrees cooler in the summer, BBC reports

Green roofs like Thammasat University’s are a part of a larger flood management concept gaining traction called “sponge cities.” Developed by Kongjian Yu, a landscape architect in China, this method calls for creating more nature-based areas to slow and absorb excess water instead of diverting it with pipes and concrete. 

Though rooftop gardens are also a part of Frankfurt’s plans to stay cool, focusing on that alone isn’t an effective way to address extreme heat — its main problem as one of the hottest cities in Germany. That’s why individualized, hazard-specific approaches are important. Frankfurt worked with experts to develop a map of the wind corridors that keep the city cool. Now, the city uses that information to build green spaces that link air corridors to keep air moving and keep houses and skyscrapers out of the way, Bloomberg reports.

But cities are complex environments. Even those facing the same problem likely need to take different approaches. While Frankfurt focuses primarily on greenery and air currents to keep neighborhoods from heating up, cities like Los Angeles are trying cool pavement coatings. Applied like paint, the coatings decrease the temperature of the ground and the air around it by reflecting the sun’s rays, as 3p previously reported. When applied on a park in one of the hottest neighborhoods in the city, the coated pavement measured up to 14 degrees Fahrenheit cooler than non-coated areas, and residents said they noticed the difference. 

The downside to this often necessary, individualized approach is incredibly slow progress. I isolated the most pressing issues in the locations above, but most cities face several climate impacts simultaneously. And though adaptation methods can apply to many different cities, they typically need to be altered based on the location’s unique circumstances. It’s rarely a copy-and-paste process. 

Still, collaboration is happening. The group of mayors that make up C40 cities, for example, are sharing knowledge with each other and the public as they work to halve their cities’ emissions. The United States Environmental Protection Agency also employs regional climate change adaptation coordinators who synchronize efforts across the country. 

The key is sharing information to provide a starting point. From there, the solution can be modified to meet specific needs based on local knowledge and input from the residents most vulnerable to climate impacts. Why waste time recreating a recipe that already exists from scratch?  

Dive deeper into this solution: 
●    He’s Got a Plan for Cities That Flood: Stop Fighting the Water, The New York Times
●    As temperatures in India break records, ancient terracotta air coolers are helping fight extreme heat, BBC
●    Skyscrapers Can Make a Statement About Sustainable Design, TriplePundit
●    Podcast: Keeping Cities Cool in a Warmer Future, The Wall Street Journal

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Climate change is reducing urban livability, pushing cities around the world to become incubators for innovative solutions. Each one takes a different approach to adaptation.
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The Global Clean Energy Transition is Unstoppable, and Green Hydrogen Could Change the Game

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Zero-carbon sources now account for more than 40 percent of global energy generation capacity, according to a BNEF analysis released this week. A stunning 91 percent of all new power capacity added in 2023 came from solar and wind, compared to only 6 percent from fossil fuels, according to the research. 

BNEF's Power Transition Trends report gathers data from more than 140 markets to track energy trends globally. China is far and away ahead of the pack in renewable energy deployment, consistent with its fast-paced record on wind and solar development over the past 10 years. "The U.S., Brazil, Canada and India rounded out the top five, which accounted for 60 percent of the world’s renewable generation last year,” BNEF reported. 

Green hydrogen can overcome obstacles to even more clean energy development in the U.S.

The U.S. ranked second behind China for new renewable energy investments in the first half of 2024, according to BNEF. But some obstacles continue to slow the pace of change, including a subset of lawmakers who seem determined to reverse the clock on clean energy.

Aside from partisan politics and local objections, gaps in the electricity transmission network and a bottleneck for grid connections continues to impede renewable energy development. The emerging green hydrogen industry offers a solution for both at once. 

In contrast to conventional hydrogen extracted from natural gas or coal, green hydrogen is produced from renewable resources. Most green hydrogen is made by splitting water in electrolyzers, which use an electrical current to extract hydrogen and oxygen from water molecules. Using electricity supplied by wind or solar farms to produce green hydrogen essentially creates a large-scale, long-duration energy storage platform.

Green hydrogen can be transported by rail, truck, pipeline or ship instead of relying the existing grid network to transport renewable electricity. Electrolysis systems can also run at night when excess wind power is available or during daytime periods when solar generation outstrips demand.

Accelerating the U.S. hydrogen economy with renewable energy

Despite the obstacles, the 2022 Inflation Reduction Act championed by President Joe Biden is rightfully credited with spurring a powerful new wave of renewable energy investment. But it's not the only significant new law stimulating the renewable energy sector. The 2021 Bipartisan Infrastructure Law also contains a key hydrogen provision that will help.

Though passed one year before the Inflation Reduction Act, the hydrogen component of the infrastructure law requires a lengthy pre-implementation period that is still ongoing. The provision designates $7 billion for a new program to stimulate the U.S. hydrogen market. Called the Regional Clean Hydrogen Hubs program, the goal is to organize the unique energy resources, market opportunities and infrastructure strengths in different regions of the U.S.

Some funding is reserved to support hydrogen production from natural gas with carbon capture, but the bulk of the effort is focused on renewable energy resources along with a measure of nuclear energy.

Last fall, the U.S. Department of Energy selected seven regional hubs for potential funding. Following a period of negotiation, three of those hubs progressed to the funding award stage.

One is the Pacific Northwest Hydrogen Association, which covers Montana, Oregon and Washington, three states with relatively low populations, ample space and abundant renewable energy resources that include offshore wind.

The group plans to cut the cost of electrolysis systems by supporting the electrolyzer manufacturing industry. “The Pacific Northwest Hydrogen Hub’s vast use of electrolyzers will play a key role in driving down electrolyzer costs, making the technology more accessible to other producers, and reducing the cost of hydrogen production,” the group explains. 

The ultimate goal is to supply green hydrogen to fuel a low-emission, heavy-duty freight network for the entire West Coast. “Other hydrogen uses include agriculture (fertilizer production), industry (generators, peak power, data centers, refineries), and seaports (drayage, cargo handling),” the group adds.

Meanwhile a sister hub in California, the Alliance for Renewable Clean Hydrogen Energy Systems (ARCHES), intends to produce hydrogen from biomass along with water electrolysis. It plans to use the hydrogen it produces to decarbonize seaports in the state and export the excess to other markets. 

Natural gas gets some support, but diversification is the key

The third awarded hydrogen hub is the Appalachian Regional Clean Hydrogen Hub (ARCH2). This group focuses exclusively on natural gas with carbon capture, covering West Virginia, Ohio and western Pennsylvania. That approach may not pay off in the long run if the other new hubs fulfill the promise of flooding the market with low-cost green hydrogen. And it is certainly not consistent with the urgent guidance of climate scientists and policymakers who cite the need for rapid decarbonization. Nevertheless, the Bipartisan Infrastructure Law does stipulate a carveout for natural gas.

In sharp contrast to ARCH2, the other six hubs demonstrate how different renewable resources can be called upon to support a robust, diversified domestic hydrogen industry. Of the four remaining hubs that are still negotiating their final awards, none focuses exclusively on natural gas.

Eastern Pennsylvania, for example, joined with Delaware and New Jersey to form the Mid-Atlantic Clean Hydrogen Hub consortium, aimed at leveraging renewable and nuclear energy for water electrolysis. New Jersey and Delaware have access to offshore wind areas leased by the U.S. Department of the Interior to further power the effort. 

The Gulf Coast Hydrogen Hub in Texas plans to focus on both water electrolysis from the region’s vigorous wind and solar industries as well as natural gas with carbon capture. Spearheaded by the firm HyVelocity, the consortium aims to push down the overall cost of hydrogen by deploying low-cost natural salt caverns and pipeline infrastructure for storage and distribution.

Similarly, the Heartland Hub of Minnesota, North Dakota and South Dakota will leverage different renewable and non-renewable energy resources to stimulate the regional hydrogen market, with a particular focus on decarbonizing fertilizer production.

A fourth diversified hub awaiting negotiation is the Illinois-Indiana-Michigan Midwest Hydrogen Hub. Under the umbrella of the Midwest Alliance for Clean Hydrogen, this hub aims to decarbonize heavy industries like steel- and glass-making along with power generation, refining, heavy-duty transportation and aviation fuel.

As the full effect of the Regional Clean Hydrogen Hubs program begins to materialize over the coming years, the Inflation Reduction Act is also motivating the introduction of new financing tools that support renewable energy and energy storage projects. However, these important new policies should not be taken for granted. To achieve the maximum impact on rapid decarbonization, they will need consistent, strong support from the next president, and from Congress, state lawmakers and the American public.   

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Zero-carbon sources now account for more than 40 percent of global energy generation capacity, according to a BNEF analysis released this week. Green hydrogen could be the missing piece to total dominance for the renewable energy sector.
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Support for California’s Climate Disclosure Rules Remains Strong Despite Push for Delay

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California Governor Gavin Newsom proposed a two-year delay on Senate Bills (SB) 253 and 261. The move comes in spite of widespread support for the initiatives. The fate of the climate risk disclosure bills now rests with the state’s legislature. The governing body has until the end of the month to decide whether they will be enacted on schedule.

SB 253 requires companies doing business in California with a total revenue above $1 billion to report the greenhouse gas emissions associated with their direct operations (Scope 1) and their purchased energy (Scope 2) beginning in 2026 and the emissions produced across their value chain (Scope 3) the following year. The revenue threshold for SB 261 — which requires companies to report on climate-related financial risks — is half that amount, at $500 million. If Governor Newsom’s proposal is passed, neither will be implemented until 2028.

“We're experiencing climate change right now. We've got wildfires, we've got flooding, and we need to take care of California and its residents,” Catherine Atkin, director and co-founder of the climate data initiative Carbon Accountable, told TriplePundit. “The only way to do that is to address the broader greenhouse gas emissions environment, and this data will support California protecting its citizens.”

An unnecessary delay

Atkin, who collaborated with bill author and California State Senator Scott Wiener to develop the framework for SB 253, said the proposed delay is unnecessary. To demonstrate this, Carbon Accountable compiled a report, which Atkin was the lead author of, detailing why the bill needs to be put into practice along its original timeline and how to do so. Additionally, a coalition of policy and action organizations joined forces with Carbon Accountable to request the passage of SB 219, which makes technical amendments to ease the bill’s implementation and gives the California Air Resources Board (CARB) an additional six months to complete rulemaking without delaying the reporting requirements.

Catherine Atkin, who helped develop California's climate disclosure bill SB 253.
Catherine Atkin, director and co-founder of Carbon Accountable, worked alongside California State Senator Scott Wiener to create SB 253. (Image courtesy of Carbon Accountable)

“There really is no reason for the delay. Both bills have timelines that are attainable,” Dave Jones, director of the Climate Risk Initiative at the University of California Berkeley’s Center for Law and the former insurance commissioner of California, told 3p. “There’s some regulatory work that [CARB] will have to do, but it’s very minimal because both bills rely on well-established international standards for greenhouse gas emissions reporting.”

In addition to the internationally accepted protocols for Scopes 1, 2 and 3, Jones explained that the climate risk and financial disclosures required by SB 261 are based on a framework put in place in 2017 that’s already used by approximately 80 percent of the 1,000 largest publicly-traded companies in the United States. 

Business support for California’s climate disclosure bills

“We were really heartened by the business support that built over time, and I think we've really sort of hit an inflection point,” Atkin said of the progress made over the course of passing the legislation. “We saw a lot of things shifting, and I think some of those were leading companies recognizing that they needed to be stewards for the broader business community as well.”

The California Chamber of Commerce is in favor of the proposed delay, along with other changes to SB 253, many of which are addressed by SB 219. But leading companies still support the reporting requirements, Atkin said. The same trend is noticeable globally, which is encouraging despite the pushback from business lobbies, she said.

“There was widespread business and financial institution support for both bills,” Jones said. “And those businesses that supported the bills are opposing the delay.” 

Uniform reporting standards garner support and make California a leader

“What companies said to Senator Wiener, and what I heard during this process was, ‘What we don't want is … a special flavor of California ice cream,’” Atkin said.  “These largest companies, as you know, are subject to other reporting regimes globally, as well. Many of them will be subject to [the Corporate Sustainability Reporting Directive], either now or in the future in the European Union. They may be voluntarily reporting in other jurisdictions, or be subject to [the International Sustainability Standards Board] as that gets adopted by countries. So really, what we heard from them was … ‘We want to have confidence and security in knowing that the rules are going to be the same.’”

Using the standard greenhouse gas reporting protocol was therefore imperative. And with the U.S. Securities and Exchange Commission delaying its climate disclosure rules — which are currently tied up in court — California’s are more important than ever. Atkin is hopeful they’ll go into effect in 2026 as originally proposed. Despite Governor Newsom’s push for the bills’ delay, his work championing low carbon fuel standards, cap and trade systems, and standing up to the oil and gas industry are examples of how the state is a pioneer in the fight against climate change, Atkin said.

“This is just another amazing demonstration of California's global leadership,” she said. “The world is watching California right now, so we need to step up to the plate and deliver on this promise for the benefit of Californians but also the rest of the country and the world.”

Delaying SB 253 and 261 would be a huge setback for the state’s leadership in the climate space and the commencement of emissions and risk reporting, Jones said.

Sticking to the original timeline is good for business

All too often, progress on climate regulations seems to be followed by government backtracking and an overall failure to meet targets. Fortunately, the public can make a difference by paying attention and holding government and business leaders accountable. Atkin credits the public with seeing through commitments and promises that don’t result in real change, specifically related to greenwashing.

“It's critically important that the public, which is paying attention to these issues, but also businesses and advocacy organizations that are concerned about the fact that the planet is literally burning, continue to support efforts in a timely and responsible way to address these issues,” Jones said. “Sadly, it is the case that when important laws like these get passed, it's not necessarily the end of the story. So it requires a continued engagement and vigilance.”

SB 253 and 261 are about transparency. Neither will require businesses to reduce their greenhouse gas emissions or climate-associated risks, Atkin said. But they will help the economy transition and grow.

“We want companies to do well, and this data is going to help them,” she said. “That, to me, is kind of the sweet spot. When we have transparency and accountability, but with an expectation that we're going to build a strong economy through this effort.”

For companies and financial institutions to transition their activities and investments, they’ll need to start by measuring and reporting their greenhouse gas emissions and climate risks, Jones said. That information is also important for the public, policymakers and financial regulators.

“Fundamentally, this is about creating a level playing field so that companies and financial institutions are both identifying and disclosing what their contribution is to climate change, as well as what risks they face from climate change,” he said. “You can't manage what you don't measure, right?” 

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The California State Legislature has until the end of the month to decide whether to delay a pair of climate disclosure bills that require companies to report greenhouse gas emissions and climate-related financial risks: SB 253 and 261. Experts and businesses say the delay is unnecessary.
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Fair Trade Avocados Are Growing Rural Economies in Mexico

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The global demand for avocados has surged in recent years, transforming this once-regional fruit into an international sensation. While the booming market brings economic opportunities, it also poses obstacles for farmers and communities striving to grow the market in a sustainable and equitable way.

Amidst these challenges, Fair Trade certification is a beneficial program with a mission to foster sustainable development, economic stability and social equity. For Carlos Genel, an economist and second-generation avocado grower in Michoacán, Mexico, becoming a Fair Trade organization was a win for his community. 

How Fair Trade works 

Fair Trade ensures farmers receive a guaranteed minimum price for their avocados, acting as a safety net against market fluctuations. This stability allows farmers to plan for the future, invest in their farms and provide for their families. Additionally, Fair Trade premiums — extra funds paid on top of the selling price — must be invested back into the community, financing projects like education, healthcare and infrastructure improvements.

“The extra money goes to our workers to improve their lives, and the workers manage and administer the money from the premium,” Genel said. “The program educates them because they learn how a company is managed and how to manage money.”

Even before joining the Fair Trade network, Genel was passionate about sustainable rural economic development. “Joining Fair Trade just formalized the way we liked to work,” he told TriplePundit. “We are part of a huge network of people who value the things that we value, like respecting people and the environment, caring for each member of our team, and thinking about the long term in everything we do.”

Fair Trade certification empowers farmers and workers by promoting democratic decision-making processes. Cooperatives and associations formed under Fair Trade principles give farmers a collective voice, allowing them to negotiate better terms, share knowledge and support each other.

Genel employs between 60 and 70 farmworkers, who used their Fair Trade premiums to launch programs that improve access to food, healthcare and education in their communities. For example, they developed a school for their families and neighbors, with classes for elementary and middle school children, as well as adults. The farm also invests in a local university, Universidad Latina de América, which provides high school, undergraduate, postgraduate and professional certification educational pathways.

“I am the third generation in my family to invest in this university,” Genel reflected. “I feel very proud of that. It is ranked in the top 50 universities in Mexico.”

The workers on Genel’s farm also invested in programs to improve community health and nutrition. Their Fair Trade premiums provide a large basket of groceries to every employee’s family each month, and workers regularly organize health-promoting campaigns such as local testing and educational workshops.

“Recently, the workers paid for an eye doctor to test all of their children’s vision,” Genel explained. “They collaborate with other organizations for other health initiatives, too.”

avocado orchard in Mexico — growing avocados
An avocado orchard in Michoacán, Mexico.

Social gains grow market opportunities

Fair Trade certification offers transparency and traceability to conscious consumers, assuring them that their purchases support ethical practices. For farmers, it opens access to markets that prioritize ethical sourcing and are willing to pay a premium for it.

Implementing sustainable and socially responsible farming practices has long-term benefits, including the creation of a more resilient agricultural system. However, sustainability and social responsibility are also growing market opportunities for Genel in the short term. 

“The certifications I hold, including Fair Trade, have an economic benefit,” he said. “I can export directly to the U.S. without going through an intermediary, which saves money. I am starting to develop partnerships with American companies like Costco and Whole Foods.”

Genel sees other producers in Mexico beginning to realize the economic benefits of participating in programs like Fair Trade. 

“There is a generational change happening now. New generations are coming into the family business, and they have a different mindset and perspective,” he observed. "They see the benefits of Fair Trade and other agricultural certifications. Many of these farmers are environmentally friendly and have a great social impact, but they don’t know that there are certifications they can leverage. It is important to educate other farmers and workers about the existence and benefits of these programs.”

Sowing seeds for the future

Genel is working hard to expand his outreach efforts. “We have a social responsibility program at the company as well as many sustainability initiatives and practices that we have put into place,” he said. “We have been working with growers in Chihuahua on developing better irrigation methods for very dry land. In Michoacán, we have implemented these methods, too, not because the land is dry but because it saves water and allows for more efficient water management.”

Even while expanding his educational efforts to other growing communities, Genel remains focused on preserving the ecosystem where his farm and family thrive. “We have a big forest on our land, full of flora and fauna. There are local, native species of animals and plants,” he told us.

He knows the success of his farm is largely tied to the ecosystem services and positive environmental impacts that forests provide. “We have developed an initiative to help maintain the health of the forests,” he explained. “It is part of our business strategy to take good care of our ecosystems and communities.”

This article series is sponsored by the Avocado Institute of Mexico and produced by the TriplePundit editorial team.

Images courtesy of the Avocado Institute of Mexico

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Fair Trade certification helps to foster sustainable development in growing regions and ensure economic stability for farmers. For Carlos Genel, an economist and second-generation avocado grower in Michoacán, Mexico, becoming a Fair Trade organization was a win for his community. 
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Could AI-Bred Microbes Help Save Our Plastic-Choked Oceans?

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Thanks to our addiction to easy-to-use and dispose of single-use plastic, the world’s seas are a mess. If we are to save them — and the marine life in them — we need a strategy to remove the plastic plaguing the seas and figure out ways to keep these essential waters clean. 

New advances in computational biology and microbiome research could help with the development of those strategies and solutions, especially the use of microbes that actually eat plastic. Using artificial intelligence (AI) powered discovery and optimization technologies along with genetic manipulation techniques, scientists have made a great deal of progress in identifying and developing such microbes. 

Mass production of these microbes could, for the first time, enable humanity to get ahead in the race to prevent a total plastic takeover of the environment, both on the sea and land. While a great deal of work still needs to be done, researchers believe these microbes could hold the key to a cleaner and healthier environment — and better human health.

Marine plastic pollution has reached epidemic proportions. A UNESCO report contains frightening statistics: There are about 50 to 75 trillion pieces of plastic and microplastics in the ocean, which is growing by 8 to10 million metric tons yearly. Plastic waste now makes up 80 percent of all marine pollution, and within three decades, the sheer mass of ocean-going plastic will exceed the weight of all fish in the sea, according to the agency. 

Plastic can take as long as 1,000 years to decompose totally. In the meantime, it simply deteriorates into smaller pieces of microplastic, often consumed by fish, which are eventually eaten by humans and other animals. While the long-term consequences of this plastic consumption have yet to be studied, they are unlikely to be good. In any event, researchers say that the chemicals associated with microplastics are likely to lead to numerous serious health issues such as endocrine disruption, weight gain, insulin resistance, decreased reproductive health and cancer.

However, recent evidence has discovered some microbes — tiny living organisms — can essentially degrade certain plastics, signaling new hope for our polluted oceans. Take for instance, a chance discovery by a Japanese research team of a microbe “happily chewing through plastic bottles.” Another study collated a large database of additional microorganisms identified as capable of degrading plastics.  

Earlier research initially showed that microbes could reduce plastic pollution, and more recent studies show that microbes are evolving to biodegrade plastic. A Swedish team discovered 30,000 enzymes — proteins produced by microbes that build up and break down substances — that could degrade over ten types of plastic. While these enzymes can reduce pollution on land and sea, they are especially suited to digesting plastic in the ocean. 

Unlike on land, the number of these plastic-digesting enzymes increases with the depth of the water and as the presence of plastic pollution increases. This could indicate that the enzymes adjust their abilities based on the environment and amount of plastic present. It’s unclear how this evolution is taking place or through what mechanism specific microbes and genes respond to particular types of plastic, but it is a growing area of research. 

Many questions remain. A large-scale study of how microbes interact with plastic has yet to occur. Much more research is needed to develop an effective, large-scale solution to microbe-based plastic decomposition. That is likely to require genetic manipulation of microbes to whet their “appetite” for different kinds of plastic, as well as developing methods to produce them in large amounts. 

And while microbes can effectively break down certain kinds of plastic, they can take a very long time to do so, given their small size. Many microbes would be needed to make a dent in large pollution concentrations, such as the Great Pacific Plastic Patch

Most of the microbes discovered operate on two particular kinds of plastic: PET and PE plastics. Often used to make bottles and bags, scientists say these are “relatively easy” types of plastic to decompose. Developing microbes to decompose other types of plastics will be a more significant challenge, though progress is being made

Meanwhile, the decomposition of plastics could lead to other problems, such as the large-scale release of carbon dioxide, which has adverse effects on the roots of aquatic plants and abnormalities in their production of sugars and proteins and their ability to absorb nutrients.

The solution to these issues could also lie in the genetic manipulation of enzymes to increase their plastic-eating efficiency and limit or eliminate the harmful effects of releasing excess carbon dioxide or other gasses. It was also an accidental discovery that led scientists along this path. British scientists used X-rays and other tweaks to improve the effectiveness of the original plastic-eating enzymes discovered by the Japanese team, developing a new enzyme that works much more quickly and efficiently. It can also be produced in quantities, although it is primarily restricted to eating PET-type plastic. 

Meanwhile, researchers at North Carolina State University developed another genetically modified microbe that breaks down PET plastic quickly and can thrive in salt-water environments, which is a challenge in other plastic-eating microbe projects.

It is clear that recent scientific advances are enhancing the ability of microbes to consume plastics. But the potential applications for waste-eating microbes go far beyond plastics. Research is increasingly shedding light on the potential to use bacteria to address other pollutants like industrial and explosive waste. Efforts should be made to address these issues simultaneously as the options increase for using biology and living organisms to clean up the environment. 

While much more work needs to be done, it appears that microbes developed or tweaked with the help of AI and computational biology can help us in the battle against a wide range of pollutants, especially plastic in the oceans. And we need that help desperately. 

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Microbes could hold the key to a cleaner and healthier environment. Scientists around the world are discovering tiny living organisms that can biodegrade plastic pollution in the oceans.
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Corporate Climate Targets Are a Mess. Could Tracking 'Spheres of Influence' Help?

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This story was originally published by Grist. Sign up for Grist's weekly newsletter here.

In order to avoid the worst impacts of global warming, scientists agree that the world needs to reach net-zero greenhouse gas emissions by midcentury. How to get there is a more contentious question.

So far, the dominant strategy has been for companies, governments, and other institutions to set their own emissions reduction targets. The idea is that if everyone aims for net-zero by 2050 and comes reasonably close to achieving it, the world will be spared a climate nightmare.

This strategy has only worked to a limited extent — especially in the private sector. More than half of the world’s 2,000 largest publicly listed companies don’t even have a formal net-zero goal, and only 4 percent of those that do meet a United Nations initiative’s baseline criteria for reliability. Companies often rely on questionable accounting or otherwise exaggerate their progress toward climate targets, despite the emergence of several independent standard-setting bodies and verification schemes.

Researchers at the University of Oxford and the Exponential Roadmap Initiative, a Swedish organization that advocates for corporate emissions reductions, are now calling for a different approach — one that can effect change on a more systemic level. In a research paper published last week in the journal Carbon Management, they argue for an additional corporate climate reporting system that incentivizes other forms of action, like lobbying for national climate policies and investing in conservation projects.

“We have been leaving a huge amount of impact on the table by failing to encourage or invite companies to be rewarded and compared for their significant efforts beyond their value chain,” said Kaya Axelsson, a research fellow at Oxford University’s Smith School of Enterprise and the Environment and a co-author of the paper.

She said those rewards could take a number of forms, including interest from consumers or investors, or preferential treatment for government contracts.

Axelsson and her co-authors are by no means the first to criticize existing corporate carbon accounting practices. Over the past several years, academics, think tanks, and even government agencies have suggested ways to boost transparency and make companies’ net-zero pledges easier to compare. Standard-setters themselves have also sought stakeholder feedback to address widely acknowledged problems. Few experts, however, have called for an entirely new set of accounting standards.

Under the researchers’ proposal, companies would set targets and track progress toward three “spheres of influence,” related to categories they call “product power,” “purchasing power,” and “political power.”

This is in contrast to today’s most prevalent climate reporting regime, in which companies tally up the greenhouse gas emissions associated with their own operations, the electricity they buy, and the products they sell to customers — known as Scope 1, 2, and 3 emissions, respectively. These scopes are collectively described as a company’s greenhouse gas inventory.

The authors’ first proposed sphere of influence, product power, would consider emissions avoided as a result of a company’s new products or practices, compared to a world in which those products or practices didn’t exist. The authors say this could incentivize companies to decarbonize all of society, rather than simply increase the efficiency of their existing products and supply chains.

This gets at a problem that might be faced by, say, a fast-growing renewable energy company. Under the scope-based standards, the company would be penalized for the greenhouse gas emissions it emits when it manufactures wind turbines. But those turbines might be used to displace another company’s fossil fuel use, providing a societal climate benefit. The renewable energy company should be recognized for this contribution to the greater good, Axelsson said.

The second sphere, political power, would recognize the role companies play in shaping local, national, or international regulations, and incentivize them to advocate for climate action, rather than against it. This reflects the guidance of an expert panel of the United Nations, which said in a 2022 report that corporate actors “must align their external policy and engagement efforts, including membership in trade associations, to the goal of reaching net-zero by 2050.”

The goal wouldn’t necessarily be to quantify the impact of companies’ political lobbying, the paper clarifies, but to acknowledge and reward it: “A company taking significant steps to change a political system constraining climate progress across its sector should arguably be treated preferentially to a company with the same inventory emissions who has chosen not to engage in political processes.”

Perhaps most significantly, the researchers’ third proposed sphere, on purchasing power, would address a divisive question: whether activities to drive down emissions outside a company’s operations and supply chain can somehow count toward that company’s climate targets. Today, many companies say yes — they participate in an unregulated carbon market in which credits representing some amount of sequestered or prevented carbon dioxide can be purchased in order to “offset” a company’s Scope 1, 2, or 3 greenhouse gas emissions. These credits are typically generated by activities like planting trees, investing in renewable energy to replace fossil fuels, or protecting forests that are in danger of being chopped down.

Scientists say this approach is flawed for a number of reasons, including because it implies an inaccurate equivalence between a ton of carbon emitted from the combustion of fossil fuels and a ton of carbon stored in biological systems. Research has shown that the two don’t have an equal and opposite effect on the climate system. Carbon offsets can also give companies an excuse not to reduce their own emissions.

 

That said, credit-generating activities themselves can actually be helpful; it’s their use as offsets that’s problematic. The purchasing power approach would track companies’ support for these activities separately from their greenhouse gas inventories, giving them an incentive to continue that support without the contentious math associated with offsetting. This is similar to the idea of “contribution claims,” in which companies simply advertise their financial contribution to renewable energy projects, grid resilience, afforestation, and other climate action, without making any claims about the amount of carbon saved.

“Projects which serve to protect nature or enable clean development still play a role, if imperfect, in global mitigation and adaptation efforts,” the paper says. “When a company uses its purchasing power in this way it goes above and beyond another company that has not done so.”

Doreen Stabinsky, a professor of global environmental politics at the College of the Atlantic in Maine who was not involved in the research paper, said the new proposal could address flaws in current climate reporting systems. But she questioned the premise that corporations will be sufficiently motivated to address climate change just because doing so would appeal to consumers and investors.

“I agree that there’s a problem with a myopic focus on inventory emissions, and I agree that you need to have innovative strategies that operate at a system level,” she said. “But I’m critical of thinking that it’s up to individual companies to innovate those system-level strategies.”

She said the researchers’ proposal focuses too much on improvements to the market system and overlooks governments’ responsibility to oversee society-wide decarbonization. “There are things that we’re not going to be able to make happen through these market-based approaches,” she added.

Axelsson told Grist she sees voluntary standards as “a necessary but insufficient tool for corporate climate accountability,” and said they can be a stepping stone to government policies.

“Standards can be a good regulatory sandbox for testing new ways of thinking about concepts holistically,” she added. “If net-zero is at a turning point where we’re asking companies not just about their footprint but also about their impact, we probably need to test that in a voluntary space and then hopefully governments can start seeing that that’s something that they can ask for.”

This article originally appeared in Grist. Grist is a nonprofit, independent media organization dedicated to telling stories of climate solutions and a just future. Learn more at Grist.org. 

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New research proposes a new, more expansive way to look at companies’ contribution to global net-zero.
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Harnessing AI for Corporate Sustainability Requires Precautions

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Artificial intelligence (AI) has the potential to play an integral role in corporate sustainability. However, the massive amount of energy needed to run the technology threatens to overshadow potential advantages. Widespread use is expected to cause a 160 percent surge in data center energy demands by the start of the next decade, undoing previous gains in operating efficiency.

A recent survey from the software company Salesforce and the market research firm YouGov reflects this dilemma, with 81 percent of sustainability professionals agreeing that lowering AI’s carbon footprint is important. At the same time, 58 percent think it can be used to have a net positive impact on the climate crisis.

How are sustainability professionals using AI?

“The top use cases are for improving energy efficiency,” Boris Gamazaychikov, the senior manager of emissions reduction at Salesforce, told TriplePundit. “So things like monitoring energy consumption [and] predicting when energy use is high, carbon emissions modeling, and then ensuring compliance with environmental standards and regulations. Those are kind of the top three.” 

Of those using AI in their sustainability programs, 65 percent claim it is transformative. But only 20 percent of the survey’s respondents completely integrated AI into their sustainability programs. Another 29 percent are still testing its use.

Not everyone is convinced that AI will be a boon for sustainability. While approximately half of respondents use AI in their sustainability efforts, the other half do not. Almost 40 percent said they are concerned that it will do more harm than good for their company’s sustainability.

“AI does have this very sort of wide-ranging and potentially extremely beneficial range of uses, but I do not think that we are quite there in terms of the corporate space,” Monica de Bolle, senior fellow at the Peterson Institute for International Economics, told 3p. She expressed concern that — while AI can be used to track energy use and other beneficial monitoring activities — it’s all too common for the tech to be used for inane activities, like drafting emails, that save minimal amounts of time and use excessive energy.

Where should the line be drawn on AI?

AI is also used for forecasting and reporting, Gamazaychikov said. “It's great that we have so many [environmental] regulations,” he added. “It's really important. But now there's so much time spent by sustainability professionals filling in forms, basically, and writing the same narrative in a slightly different way to satisfy a slightly differently worded question. So generative AI is really well suited for that.”

Likewise, AI can look at millions of data points and make forecasts in a fraction of the time it would take a human. Still, it’s important for sustainability professionals to be cognizant of the carbon footprint of their AI use versus how effective it is and how much time they save.

“The kind of energy consumption that we're talking about for different types of AI algorithms is equivalent, or higher than, what cryptocurrencies consume in terms of energy,” de Bolle said. Policymakers and grid planners continue to raise concerns about cryptocurrency mining’s energy use and emissions. It’s likely responsible for 0.6 to 2.3 percent of the United States’ electricity consumption, according to the U.S. Energy Information Administration.

That’s a big deal considering 75 percent of knowledge workers use AI in the workplace. And many of them are providing their own tools, which means the full breadth of environmental harm caused by AI use in the office may be unknown.

“I think using AI to help people write emails is definitely a waste,” de Bolle said. “If you're a corporate leader, and you're looking at the uses of AI within your own company, and you're somebody who's environmentally minded, and you care about the impact that your company's having, then you … should be delineating those activities where AI is going to be used and where AI is not going to be used.”

Instead of using it to do basic tasks like draft emails or simple online research, de Bolle said she would rather see AI reserved for things like scientific projects, medical care or energy monitoring,  where it can make the kind of difference that justifies its emissions and energy use.

The need for transparency and intentional energy efficiency

Gamazaychikov and de Bolle seem to agree that AI has a transparency problem. Despite, or perhaps because of, its eruption in popularity, users are largely unaware of its environmental consequences.

“It's critical that this sector be regulated,” de Bolle said. “These [AI] companies are very opaque in terms of how they operate. And they're very opaque, in particular, with regard to disclosing how much energy is actually consumed … So there needs to be regulation that says, ‘Look, you need to disclose this information.’ Because otherwise, how can companies that are actually using your product … how can they know the costs and benefits?”

Gamazaychikov would like to see a rating system for AI similar to Energy Star, the federal program that administers the familiar blue star label on products and buildings that meet strict energy efficiency standards. That’s something Salesforce is working on with the AI firm Hugging Face, in hopes of bringing transparency to the industry. 

In the meantime, he suggests that companies look at the underlying algorithms when choosing a model to use for sustainability programming. The largest models have trillions of parameters that create the foundation for their decision-making abilities and are dramatically less efficient than smaller language models that use billions of parameters, Gamazaychikov said. The smaller traditional machine learning models are sufficient for the monitoring, predicting and forecasting that corporate sustainability teams do.

“Next it's important to think about the hardware that's actually running these models … There's a lot of efficiency improvements that have been happening with AI hardware, so it's important to be mindful of what's being used to train and then deploy your AI,” Gamazaychikov said. “And then finally, the type of energy that's being used to power these data centers. How much of that is fossil fuel? How much of that is renewable energy? Between somewhere like France, with a very clean grid, and India, with a lot more fossil fuel, you can see a 95 percent carbon emissions difference. [It’s the] same exact workload, but just talking about a different type of energy usage.”

Do the benefits outweigh the harm?

It may sound like a lot for sustainability professionals to consider, but which model they choose will determine the environmental impact of their company’s AI use. After all, the whole point of using the tech in sustainability programming is to enable sustainability — not to solve one efficiency problem by creating another. 

But for AI to have a net positive impact, companies need to limit its use to where it can make a real difference. “I think you have to use AI responsibly,” de Bolle said. “And using AI responsibly means: Is it really helping to get to whatever result you want to get to? Or are you just cutting down three minutes of a person's time by using AI to write an email?” 

Overall, AI appears to have the potential to make a huge difference in corporate sustainability if it’s used responsibly. “We're at a really critical inflection point,” Gamazaychikov said. “AI innovation has been picking up dramatically, so we're at this point where we are seeing a potential future where AI could exacerbate climate change if precautions aren't taken.”

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Sustainability professionals are using artificial intelligence (AI) to help with tasks like improving energy efficiency and ensuring compliance with environmental regulations, but others are concerned it will do more harm than good for their company's sustainability. There's a lot to consider, but with the right precautions, AI could be a benefit.
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Two Years Later: What's the Impact of the Inflation Reduction Act?

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The Inflation Reduction Act marked its second anniversary last week. Much of the attention focused on the size and number of new, mega-scale renewable energy projects it supported. That's only the beginning, as millions of households, small businesses and other stakeholders begin to explore new tax credit opportunities for investing in small-scale renewable energy and energy-efficiency projects. 

The impact of the Inflation Reduction Act, two years later

A recent analysis from the U.S. Treasury Department gives insight into how individual households are leveraging the tax credits available under the Inflation Reduction Act. “New data from the Internal Revenue Service show that more than 3.4 million American families have already claimed more than $8 billion in residential clean energy and home energy-efficiency credits against their 2023 federal income taxes,” the Treasury Department reported earlier this month. 

The bulk of the total consisted of $6 billion in tax credits claimed by 1.2 million families for renewable energy projects including solar panels, solar water heaters and batteries for home energy storage. Another 2.3 million families claimed the remaining $2 billion for home energy-efficiency improvements like heat pumps and insulation, for an average of $880 per family. 

The Treasury Department projects the final figures for the 2023 tax season will be even higher, as late and extended returns are still being processed.

Residential investments in clean energy and energy efficiency translate into significant savings on utility bills, helping to insulate households from volatile energy costs, the analysis noted. That price protection can play an important role in mitigating recessions linked to energy price shocks, which can have a positive ripple effect on small businesses and other local stakeholders. 

In addition, household savings on utility bills can free up more money to circulate in the local economy. A recent survey commissioned by the online marketplace Faire takes note of strong consumer sentiment in favor of supporting local shops and businesses as an important quality-of-life element in their communities.

Above all, the analysis emphasizes that small-scale energy investments under the Inflation Reduction Act will add up to a significant impact on greenhouse gas emissions in the U.S., and on the economy as well. If every household switched to heat pumps, for example, total U.S. carbon dioxide emissions would fall by up to 9 percent annually, leading to follow-on economic benefits between $84 billion and $150 billion each year, according to the U.S. EPA .

A helping hand for accessing information about tax credits 

Individuals and small businesses typically don't have the same tax attorneys and accountants as large-scale energy developers, but resources are available to help smaller energy buyers find out about new opportunities presented by the Inflation Reduction Act.

Among them is the new Climate Hub launched by the office of Sen. Edward J. Markey (D-Mass.) last week. Designed to ensure information about grants and tax credits reaches small businesses and other small energy consumers, the Climate Hub covers provisions of the Inflation Reduction Act as well as the 2021 Infrastructure Investment and Jobs Act (also known as the bipartisan infrastructure law).

"Together, these two laws have created the largest and most significant climate and clean energy investments in history, putting the United States on a path to address the climate crisis, repair historic harms to disadvantaged communities, create good-paying union jobs in the clean energy economy, and work towards a Green New Deal future,” Markey said in a statement.

The Climate Hub collects all of the relevant information about available tax credits in one place, including how-to instructions, webinars and resource guides developed by Markey's office as well as the White House, federal agencies, and non-governmental organizations.

Anyone can use the Climate Hub website, but Markey draws particular attention to energy consumers who don’t have the knowledge and resources available to large-scale investors. That includes cities, towns, Indigenous Tribes and communities impacted by environmental injustice, along with schools, labor organizations and individuals.

One particularly valuable message from the Climate Hub is a reminder that the provisions of these two laws are not yet fully implemented. Tax credits available through the Inflation Reduction Act, for example, will continue in effect until 2032 or until the U.S. achieves a 25 percent reduction in carbon emissions from electricity generation.

Business owners, managers and other stakeholders can stay updated on new developments by checking into the Climate Hub website regularly, getting in touch with their representatives in the House or Senate, or exploring opportunities to enroll in the Green Power Partners program of the U.S. Environmental Protection Agency.

Beyond energy tax credits

In addition to the impact on carbon emissions, the Inflation Reduction Act has also fostered an important link between climate action and benefits to small businesses, including rural businesses.

Celebrating the two-year anniversary of the law last week, Department of Agriculture Secretary Tom Vilsack took note of lower energy costs, job creation, and protection from wildfire and extreme heat risks across rural U.S. communities. “The Inflation Reduction Act makes a once-in-a-generation investment that supports rural communities and their infrastructure needs, while adapting to the climate crisis and creating better health outcomes,” he said in a statement.

As the saying goes, money talks. Although the Inflation Reduction Act passed into law along strictly partisan political lines, the economic benefits have been distributed across the U.S. regardless of party affiliation, and projections indicate that U.S. communities and businesses will continue to benefit for many years to come. 

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It's been two years since the Inflation Reduction Act, which experts call the largest climate investment in United States history, was signed into law. New research points to the positive impact of the legislation, while public resources can help more individuals and small businesses benefit.
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