Emilio Tenuta is the Vice President of Corporate Sustainability at Ecolab. His strategic sustainability journey at Ecolab focuses on corporate responsibility, internal environmental stewardship and helping more than 1.3 million customers in over 170 countries operate more sustainably. Tenuta’s 30-year tenure at Ecolab, includes 25 years of technical and marketing management experience in various industries including Food and Beverage, Pharmaceutical, Lodging, Healthcare, Primary Metals and Automotive. He is actively involved in advancing global sustainability practices, with a significant focus on water stewardship. In partnership with Trucost – and a multi-stakeholder advisory group – Tenuta led development of the Water Risk Monetizer, the industry’s first financial modeling tool to assess water-related risks.
Christopher P. Skroupa: How can companies identify water-related risks before they happen?
Emilio Tenuta: Companies are more aware today than ever before that if we continue with business as usual, the global demand for water will exceed available resources. In fact, the UN is predicting that the world could face a 40% shortfall in water in less than 15 years.
To maintain their ability to grow, businesses must identify water-related risks in how they operate and manage their facilities. That begins with understanding how important water is to making and delivering the company’s products and services, and then asking yourself: How available is water where you’re operating? What’s the quality of that water? What are you paying for water currently, and what have the pricing trends been? When you ask these questions, you start to think about water in a different context and understand how your water-related risks impact you today and in the future.
Today more than ever, organizations are trying to understand how water availability affects their plans for new operations, and how to ensure sufficient supply to meet the business objectives of their current operations. They are starting to consider how they can do a more thorough risk analysis related to water supply and quality, just like they would in mitigating risks related to raw material supply, cyber security or political unrest.
Skroupa: From what I understand, water risk management is becoming more and more important to companies across the board. Is there a predictable course of change for water-related risks that companies can study to take action beforehand?
Tenuta: More companies are starting to incorporate water risk into their corporate strategy. They use this strategy to map out a flight path that allows them to be more resilient in the face of water availability and quality issues in areas where they’re operating or plan to operate. They also use this strategy to guide investments in technologies and digital solutions to drive reliability.
Companies are trying to decouple water from growth, and do it reliably, so that they don’t have challenges or issues in meeting their growth targets.
Skroupa: Is it even a feasible question to ask if company can avoid a water-related risk?
Tenuta: Yes, if you follow a disciplined approach. First, you must be aware of the issues we’ve talked about up to this point. Second, you need the ability to gather data and information on how you use water in your business. And third is risk modeling, where you start to understand what current factors affect your water use and how will they affect your business in the future.
To help businesses understand these factors, Ecolab has partnered with the World Resource Institute, a “think-tank” out of Washington D.C., who has created a tool called Aqueduct, a water risk atlas. The atlas is a water stress database of watersheds around the world. Another tool that Ecolab has introduced, in partnership with Trucost and Microsoft, is the Water Risk Monetizer, a tool that provides actionable information to help businesses understand their water-related risks and quantify these risks in financial terms to inform responsible decisions that enable growth.
I don’t think it would be a surprise to you if I said businesses today struggle to implement water reduction strategies based solely on their monthly water bills. In many ways water is inexpensive, even where it’s scarce. When it’s so cheap, businesses can struggle to make the business case for investing in water reduction and reuse strategies.
The Water Risk Monetizer helps businesses around the world understand their water-related risks. The tool allows for financial modeling to quantify the quality and quantity considerations at a local level because water is a local issue.
If you are able to monetize something, you will see value in measuring it. If you can measure it, you can begin to manage it. And if you manage it, then you can improve it. That is why we created the tool – to help businesses find a way to take action.
Skroupa: Aside from the tools you mentioned, are they any other tools that Ecolab is working with to help with mitigation of water-related risks?
Tenuta: Technology has evolved and granted us the ability to monitor and analyze more factors than we could in the past. It’s making it easier to identify water-related risk, and also provides new solutions that help companies use water more effectively and efficiently across all of their operations. Nalco Water, an Ecolab company, offers customers a technology called 3D TRASAR TM, which combines chemistry, remote services and sophisticated monitoring and control to help companies reduce water use and improve operations.
3D TRASAR technology measures key system parameters, detects upsets and takes corrective action to maximize operating efficiency in cooling water, boiler water and membrane systems. We have over 35,000 advanced sensors around the world, generating more than 27 billion data points each year by leveraging Microsoft’s Azure Cloud technology. Better connected technology and data-driven actionable insights enable us to help our customers more effectively reuse and recycle water.
Ecolab’s 3D TRASAR Technology minimizes water use, maximizes performance and optimizes costs which is important in making the business case. We believe these factors should be aligned and not at odds with each other.
A good example is our work with Termoelectrica, a power plant in Mexicali, Baja California, Mexico. They wanted to reduce their freshwater use by using grey water in their cooling tower. But grey water can carry high concentrations of calcium, sulfate and chloride, which contribute to scaling and performance issues. We conducted studies to determine the optimal cycles of chemical concentration in the cooling tower to minimize water use and avoid scaling. With 3D TRASAR technology, we were able to continuously monitor performance from a remote control room and apply the right chemistries at the right times to reduce scaling. As a result, Termoelectrica was able to save 647 million gallons of water annually – and reduce energy use by 124,000 kilowatts – for an annual savings of $60,500 at the facility.
Skroupa: To expand the idea of maximizing value, where do you think the future of sustainable business is going?
Tenuta: I have a very strong passion for that topic – it’s close to my heart. I recently went to the World Water Week in Stockholm, where for the last 20 years, the world’s foremost water experts, representing government, science and industry leaders, converge in Stockholm. During that week, we focus on the most pressing water issues that challenge the world. One issue we discussed was how companies are to move from a top-down approach to a bottom-up approach in setting water and sustainability goals.
The bottom-up approach – called context-based water targets – focuses remediation efforts where the need or challenge is greatest. This approach, which is rapidly gaining traction, leads companies to take more focused, local actions around water use and water management than ever before. It targets the resources in the locations where the problem is the greatest. That means more attention to water management in emerging economies like Pune, India or the lower Yangtze of China, where water quality and quantity are stressed.
I think it’s important to remember that corporate water use has decreased by only 10% since 2011. Obviously something has to change, or we won’t be able to avoid the economic and social consequences of a 40% gap in water supply and demand by 2030. Context-based targets and goal-setting, enabled through tools like the Water Risk Monetizer and the water risk atlas, can support actions that can make a real difference.
Emilio Tenuta will be a moderator for From Plan to Action: Implementing Robust and Comprehensive Water Plans at the Water & Long-Term Value summit on October 24-25 in San Francisco, California.