1 Supplier Sustainability Index: Getting Started Ted Fox 2/17/10

Brown and Wilmanns Environmental, LLC Agenda 2 The WM Supplier Sustainability Index Your Choices Getting your company on board The what and why of carbon footprints Simple steps to building a carbon footprint Resources

Brown and Wilmanns Environmental, LLC Supplier Sustainability Index 3 15 questions Energy and climate Material efficiency Natural resources People and community These four groups are NOT unique to Walmart…they ARE the fundementals Leveraging all four delivers bankable value

Brown and Wilmanns Environmental, LLC Energy and Climate 4 First three questions Have you measured your corporate greenhouse gas emissions? Have you opted to report your greenhouse gas emissions to the Carbon Disclosure Project (CDP)? What is your total annual greenhouse gas emissions reported in the most recent year measured ?

Brown and Wilmanns Environmental, LLC Three Basic Options 5 1. Ignore it 2. Simple Footprint and register as a S&ME 3. Complete footprint and register all Scopes 1-3 If you cant get out of it…GET INTO IT

Brown and Wilmanns Environmental, LLC First Things First (know what you dont know) 6 1. Get educated: CDP, online, books, classes etc. 2. Develop your elevator speech (engage your HQ) 3. Increase awareness and gain support 4. Provide guidance and solutions 5. Get help and get it done 6. Stay engaged after its done…the value is in the increased profits…the value to you is the education & deeper connection to retailers

Brown and Wilmanns Environmental, LLC Some Terminology 7 Greenhouse Gases (GHGs) are trace gases that control energy flows in the Earth's atmosphere by absorbing infra-red radiation. Some GHGs occur naturally in the atmosphere, while others result from human activities. There are six GHGs in the Kyoto Protocol – carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs) sulphur hexafluoride (SF6).

Brown and Wilmanns Environmental, LLC What is your Company Carbon Footprint? A carbon footprint is "the total set of GHG (greenhouse gas) emissions caused directly and indirectly by your company Activities with greenhouse gas emissions Process emissions Energy use Transport/logistics Business travel, commuting, etc. 8

Brown and Wilmanns Environmental, LLC Getting Started on Your Footprint 9 Keep it simple– Its as easy as 1, 2 and wait on 3… Scope 1: focus on direct emissions from your facilities and vehicles Scope 2: electricity and other energy sources purchased to power your facilities Scope 3: all other business related activities that cause GHGs. (business travel, commuters, shipping, etc.)

Brown and Wilmanns Environmental, LLC Getting Help from the Inside 10 Key internal resources Accounting can help get info off the utility bills and set up tracking systems Facilities may already track utility use; they can also help identify direct emission sources and equipment Engineering may be helpful with equipment characteristics Fleet managers may help with fuel use and vehicle characterization

Brown and Wilmanns Environmental, LLC Some Suggestions 11 Track data in common metric MJ or kWh for electricity and fuels for heating Use standard conversion factors Document everything! Ask utilities and fuel vendors Standard factors to convert MJ or kWh of electricity, therms, cubic meters of natural gas, etc. to CO 2 e emissions Provide historical data electronically Set up systems to automate data collection and tracking Use the GHG protocol

Brown and Wilmanns Environmental, LLC GHG Protocol 12 Already built Excel spreadsheets Straightforward when you have information and data about your facilities equipment and vehicles fuel and electricity use Gets complicated when: Lots of potential emission sources Ownership issues Leases that incorporate utilities in rent payments, etc. It provides means to ask for specific information that is needed to create a credible footprint

Brown and Wilmanns Environmental, LLC Example of Excel Tracking 13

Brown and Wilmanns Environmental, LLC Going Beyond Your Facilities (Scope 3) 14 Indirect EmissionsFirst steps Business travel, employee commuting, etc. Inbound and outbound shipping by common carrier Raw materials/products inbound to your facilities Products trans-shipped among your facilities Products outbound to your customers Collect data, set up tracking systems, automate data collection and analysis

Brown and Wilmanns Environmental, LLC Standard unit of measure 15 Calculated as carbon dioxide equivalent (CO 2 e) emissions based on Global Warming Potential (GWP) Carbon dioxide (GWP 1) Methane (GWP 25) Nitrous oxide (GWP 298) HFCs (GWP ,800) Perfluorocarbons (GWP 7,310 – 22,800) And more (CFCs, HFEs, etc.) Typically reported as metric tons CO 2 e emissions

Brown and Wilmanns Environmental, LLC Choosing Resources 16 Supplier Education: low & no cost options CDP, online, DBB, 8 th & Walton, Universities Consultants (Carbon & Sustainable practices) Look for expertise in footprints, emission reduction products/strategies and climate change. (know what you dont know) RFP recommended Carbon offset marketers They sell offsets (shares of projects that result in displacement of emissions) and typically have resources to generate carbon footprint Footprint calculators On-line calculators to generate carbon footprint May use your data or may use estimates based on facility type, size, number of employees, location, etc.

Brown and Wilmanns Environmental, LLC Knowing what you know & dont know before you get help will: Expedite the process 2. Lower confusion 3. Increase accuracy 4. Lower costs

Brown and Wilmanns Environmental, LLC Questions to Ask: External Resources 18 Experience and expertise Which protocols do they follow? Can we just do Scope 1 and Scope 2? Can we choose which, if any, Scope 3 activities to measure? How can we minimize the cost? How can you teach us the basics? Can the carbon footprint be certified? Will the carbon footprint be accepted by CDP?

Get on the learning curve Four areas of focus: Carbon, Waste, People, Profits Learn to fish and eat for a lifetime Engage your HQ with your IQ Take the lead Leverage the need Get help Know what you dont know Find resources that fit …RFP Stay involved Its good for your company Its good you Recap Brown and Wilmanns Environmental, LLC

& some more Terminology Base Year "A historic datum (a specific year or an average over multiple years) against which a companys emissions are tracked over time. Carbon Footprint The total set of greenhouse gas emissions caused by an individual or organization, event or product. It should be expressed in carbon dioxide equivalent (CO2e) Carbon Trust. Emission Factor "A factor allowing GHG emissions to be estimated from a unit of available activity data (e.g. tonnes of fuel consumed, tonnes of product produced) and absolute GHG emissions. Life Cycle Analysis "Assessment of the sum of a products effects (e.g. GHG emissions) at each step in its life cycle, including resource extraction, production, use and waste disposal. Scope 1 Direct GHG emissions occur from sources that are owned or controlled by the company, for example, emissions from combustion in owned or controlled boilers, furnaces, vehicles, etc.; emissions from chemical production in owned or controlled process equipment. Scope 2 Scope 2 accounts for GHG emissions from the generation of purchased electricity2 consumed by the company. Purchased electricity is defined as electricity that is purchased or otherwise brought into the organizational boundary of the company. Scope 3 Scope 3 is an optional reporting category that allows for the treatment of all other indirect emissions. Scope 3 emissions are a consequence of the activities of the company, but occur from sources not owned or controlled by the company.

Brown and Wilmanns Environmental, LLC Resources 21 ess_logic_of_sustainability.html http :// US/Respond/Documents/CDP_2009_Definitions.pdf (coming soon)