Environmental Engineering Reference
In-Depth Information
Overall, programs that lack government pres-
sure, offer few incentives and have no penalties
for not meeting targets yield much lower reduc-
tion levels than programs with more stringent
rules and consequences and higher rewards for
meeting targets. For this reason, programs may
start out weak and strengthen their structure and
incentives/penalties in second or third phases.
Studies show that, although success varies greatly
between voluntary programs, those that are more
structured can have very good results (Price, 2005).
Regardless of success in meeting reduction
programs, voluntary programs can alter the way
that a participating entity thinks about and manages
its energy footprint. For example, EPA's Energy
Star program led to GHG reduction of 15.2 million
metric tons of carbon equivalent (MMTCE) by
program participants (energy-efficient products
and buildings) from 1990-2000. However appli-
ance and building sector emissions as a whole
increased by 103 MMTCE over this time period
(Gardiner & Jacobson, 2002). Moreover, Energy
Star has come under recent criticism due to lack
of oversight and weak enforcement (Wald, 2009),
(Wald, 2010). In addition, the U.S. Climate Chal-
lenge program resulted in emissions that were
reported to go down, but upon closer inspection
it was found that total emissions had increased.
Companies had reported reductions, but not their
increases (Gardiner & Jacobson, 2002).
to companies attempting to reduce their
emissions (Hoffman, 2005).
•
When facing future regulation, being pre-
pared may protect the company and save it
money in the long run (Welch and Hibiki,
2003).
•
In the absence of regulation, voluntary
programs allow companies to set targets at
their own pace and in a way that best fits
their strategic objectives (Hoffman, 2005).
•
If most of the direct competitors or peers
within an industry are participating, it
could be detrimental to be one of the few
non-participants (Hoffman, 2005).
•
Participation may give the company a
competitive advantage within its industry.
•
Emissions reduction programs tend to out-
line how a company can reduce energy use,
leading to efficiency gains and bottom line
financial savings (Gardiner & Jacobson,
2002).
•
Installing or using alternative energy
sources can reduce company demand for
traditional fossil fuel, thus protecting the
company from fluctuations in fuel prices.
•
Participating in these types of programs
can be good for a company's public image
(Welch and Hibiki, 2003).
•
An entity could belong to a larger, umbrel-
la group or holding company that requires
its members to participate in emissions re-
duction (Tollefson, 2007).
Corporate Strategy in Joining
Voluntary Programs
•
If there is going to be future climate change
regulation, participants in pre-cursor, vol-
untary programs could have the capacity to
shape these regulations to their advantage
(Rugman and Verbeke, 2001).
Despite the range of outcomes related to volun-
tary programs, and the low emissions reduction
rates, it is important to note that companies may
benefit from simply participating in the program.
Companies may participate with one or more of
the following factors in mind:
Whatever the reason, we do not know when
there will be comprehensive climate regulation in
the U.S., however
“
many forward thinking U.S.
companies have decided that it is in their best in-
terests to hedge their strategic bets, preparing for
•
Voluntary reduction programs often pro-
vide free or low-cost technical assistance
