October 2007 Big Grower

Approaching It from the Ground Up By Visions Group

Welcome to our newest feature on the issue of sustainability. In this column, we will attempt to define it and report on developments within horticulture and related industries. Sustainability is a complex issue and completely voluntary at this point. If you asked 10 people to define it, you'd likely get 10 different answers. Included in those would be the terms recycling, energy conversation, biodegradable and renewable energy. Although all of these can be a part of sustainability, the true definition of sustainability is really not a single action but a complete business and lifestyle phil- osophy. We thought a good place to begin would be a glossary of terms commonly used when discussing this issue, starting with our definition of sustainability.

Say What?

Now let's look at some commonly used terms:

Agro-ecosystem : the combination of organism and abiotic factors that interact in an agricultural field as impacted by agricultural production processes.

Biofuel: any fuel derived from an agricultural product.

Biodegradable: capable of being broken down into innocuous products by the actions of living things (microorganisms).

Carbon footprint: the total amount of carbon dioxide and other greenhouse gases emitted over the full life cycle of a product or service.

Carbon neutral: a product or process that, throughout its life cycle, does not add more carbon dioxide (CO2) to the atmosphere.

Carbon offset: the process of reducing net carbon emissions of an individual or organization, either by their own actions or through arrangement with a carbon-offset provider.

Chain of custody: the pathway a product takes from its point of production to the end consumer, consisting of each entity that takes legal or physical possession along this pathway.

Ecosystem : the combination of one or more flora and fauna communities in a defined area.

Energy efficient index: a measure of relative energy efficiency, expressed in oil equivalents per unit of agricultural product produced, which incorporates electricity and fuel consumption.

Genetically modified organism (GMO): any organism whose genes or other genetic material has been modified by in vitro techniques or are inherited or otherwise derived, through any number of replications, from any genes or other genetic material that has been modified by in vitro techniques.

Greenhouse gas index: a measure of greenhouse gas emissions, expressed in CO2 equivalents per unit of agricultural product produced, associated with electricity and fuel consumption.

Organic: an integrated system of farming based on ecological principles that aim to replenish and maintain long-term soil fertility. It optimizes conditions for biological activity within the soil rather than through the application of agrochemicals. Products sold in the United States as organic must meet the requirements of the National Organic Program.

Recycling: the process of converting materials that are no longer useful in their original form into new products rather than waste.

Renewable energy: energy generated from sources that are unlimited, easily replenished or naturally renewable such as wind, water, wave, sun and refuse, and not from the combustion of fossil fuels.

Sustainable agricultural practices: agricultural production and product-handling activities that result in the production and delivery of products in a manner that is economically viable, ecologically sound and socially responsible.

Xerophytic plant: a plant that has adapted to life with a limited supply of water.

In upcoming issues of Big Grower, we'll continue to add definitions of the most relevant terms used to discuss this topic.

What's Going On

Now let's look at the initiatives of some closely related businesses on the issue of sustainability.

Wal-Mart. In a move with potentially far-reaching impact, Wal-Mart has announced it will begin measuring the amount of energy used to manufacture and distribute some of its products. It also will launch a pilot project with certain suppliers to look for ways to reduce energy use. The effort will begin with suppliers in these categories: DVDs, toothpaste, soap, milk, vacuum cleaners and soda. Wal-Mart will team up with suppliers to measure global supply chain footprint and to encourage suppliers to reduce greenhouse gas emissions. While some environmental activists are cautiously optimistic and think that Wal-Mart has been using green initiatives in the past year to improve its image battered by criticism of worker pay and benefits policies, Wal-Mart has the size and scale to make a difference.

The key test will be how Wal-Mart balances the green of the environment with the green of its balance sheet. Will it stop doing business with high-polluting companies even if they provide the lowest-cost goods? Wal-Mart hasn't said how it will use the new measurement system once it is in place. One Wal-Mart executive was quoted as saying, "We don't believe a person should have to choose between an environmentally friendly product and one they can afford to buy. We want our merchandise to be affordable and sustainable."

Wal-Mart has announced many environmentally friendly initiatives. It has improved the fuel efficiency of its trucking fleet, reduced packaging on food, led the charge in selling energy-efficient light bulbs and decided to purchase its wild seafood only from fisheries that are certified as sustainable by a nonprofit, third-party certifying organization. Wal-Mart also has plans to double its fleet's fuel economy by 2015 and make its stores 20 percent more energy efficient by 2013.

Fresh and Easy Markets (British retailer Tesco's new entry into the U.S. marketplace). While new and relatively small (just opening 20 stores in California), Fresh and Easy Markets seems committed to sustainability and is substantially ahead of its competitors. Fresh and Easy has already committed to building LEED (Leadership in Energy and Environmental Design) certified buildings, recycling or reusing all shipping and display materials, and using environmentally friendly trailers to transport food. The company also tracks its carbon footprint and has invested in California's largest solar roof on its distribution center. Fresh and Easy stores will use about 30 percent less energy than typical grocery stores through the use of:

• skylights on new buildings with overhead lighting that dims automatically.
• increased insulation to reduce heating and cooling needs.
• night shades on refrigeration cases to keep cool air from escaping.
• hybrid-vehicle parking spaces and bike racks for employees and customers.
• LED lighting in external signage and freezer case.

Fresh and Easy also has partnered with Resource Management Group (RMG) to design a world-class recycling and waste reduction program. The Fresh and Easy/RMG partnership will significantly reduce the amount of waste leaving the stores and distribution center. All display and shipping materials will be reused or recycled. A notable feature of this program will be reusing or recycling all display-ready packaging, which is one of the largest waste streams of any retailer and should significantly reduce the amount of landfill waste.

Publix Markets. Grocery retailer Publix Markets has entered the arena of organic-food marketing with the opening of its first GreenWise store on Sept. 27, 2007. Many of the foods carried in the private-label store will be organic and healthier than foods found in a typical Publix store. The retailer has sold limited quantities of its GreenWise products in its regular stores since 2000, but this is the first stand-alone store. Private labels are typically more affordable, so GreenWise is poised to take on competitors. More than 50 percent of the products carried will be organic or natural and not available at conventional Publix stores.

Energy

In floriculture production, the one element of sustainability that often comes up immediately is energy. It is generally one of the top two expenses in every production company. Supply, availability and cost — and controlling or reducing them — is often the difference between success and failure. The long-term existence and profitability of large floricultural production firms are heavily impacted by the issues associated with energy.

Driven largely by economic growth in developing countries, global energy demand is expected to surge more than one-third by 2030, and that's assuming governments continue to adopt policies that encourage energy efficiency. Fossil fuels will continue to make up most of the mix.

The prospect of carbon caps threatens every company whose business depends on burning energy. Renewable energy isn't about to replace fossil fuel. According to the International Energy Agency's chart above, fossil fuel will continue to provide the vast majority of global energy. Their share, 80 percent in 2004, will only drop to 77 percent in 2030 assuming the implementation of aggressive policies, either voluntary or mandated, to promote energy efficiency and renewable energy. But even a global energy system that continues to be dominated by fossil fuel will provide big opportunities for companies that come up with ways to consume fuel more efficiently and use more renewable energy. Floriculture production has been firmly rooted in fossil fuel. The pressure to confront global warming will only increase. The United States, the world's top greenhouse gas emitter, is sure to feel increasing pressure from both within and outside. It becomes increasingly important to seize the opportunity to be proactive in developing a sustainability program for your business while the effort is still voluntary.