John Shegerian: This is the Wharton IGEL GE water innovation technology edition of Green Is Good here in beautiful downtown San Francisco and we are so honored to have with us today Melissa Meeker. She is the Executive Director of WateReuse Association. You can find them at www.watereuse.org. Melissa, welcome to Green Is Good.
Melissa Meeker: Thank you. Nice to be here.
John Shegerian: Melissa, what is WateReuse Association for our listeners that aren’t familiar with it?
Melissa Meeker: So the WateReuse Association is focused on greater implementation and policies around promoting the implementation of water reuse projects.
John Shegerian: OK.
Melissa Meeker: We also have a research foundation, which is a separate organization that looks at technology innovation, operation challenges that the water agencies deal with, helping them with their day-to-day challenges and the research needs for the actual industry to implement reuse projects.
John Shegerian: And where are you located?
Melissa Meeker: We are located in Alexandria. So Washington, D.C.
John Shegerian: Washington, D.C. So talk a little bit about how did you come to this position. Were you always very water interested or sustainability interested, or was this something that came up along the way in your journey?
Melissa Meeker: So I am actually from South Florida. Born and raised in South Florida. This is my first – I guess – stint out of the state of Florida – moving to D.C. – so I jumped right out of the fire into the pit.
John Shegerian: Wow. Right.
Melissa Meeker: So I’ve always been involved in water issues. Grew up working for the state – Department of Environmental Protection. So I handled the regulatory side, went over to the water management district and did more water supply planning and alternative water supply development, which is what they call “water reuse” in Florida.
John Shegerian: Right.
Melissa Meeker: And have always just been involved in that side of it. So when the position opened up, I had always participated with WateReuse and their conferences and different things like that as keynote speaker and other, so for me it was a perfect transition to explore the not-for-profit world, which is completely different but also continue along an area where I have great passion.
John Shegerian: Got it. So we are here today at this very important conference that GE and Wharton IGEL School are putting on. Why was it important for you to come here and talk about water reuse, and why is this conference so important with all the great thought leaders that are here today?
Melissa Meeker: Yeah. Absolutely. So to me it’s fascinating to look around the audience and see just the brilliant people that are in there and the honor to actually be there myself.
John Shegerian: Right.
Melissa Meeker: And be able to participate in a panel. So, for us, we’ve been working in this industry before water reuse was in vogue. Before, it was the thing to talk about it as the redheaded stepchild – if you will. You had drinking water, you had wastewater and then you had that other stuff that people really didn’t want to talk about and it was all irrigation and different things like that. So the transformation in our industry from really being a waste management issue – how do you handle this waste product and get rid of it – to an actual water resource issue is just fantastic. So any opportunity we have to come and share what we know and share what our members feel about and look for when they’re talking about projects is critical.
John Shegerian: Is it even more critical that we’re here? We’re talking about innovation technology and water and sustainability and we’re here in California and in Northern California – very close to Silicon Valley and sort of the bastion of innovation. Talk a little bit about innovation technology and water reuse and water recycling, and what does the future look like of the water reuse not only here in California but around the world?
Melissa Meeker: So, of course, right now, California is the central area that everyone thinks about because of the severity of the drought which we’re going through.
John Shegerian: Right.
Melissa Meeker: No one wants a natural disaster like this to happen.
John Shegerian: Right.
Melissa Meeker: But what it does for the industry is it’s really given us a push. People are now much more open, because they really don’t have any other options. Same thing in Texas with Wichita Falls. They didn’t have other options for water supply so they went to WateReuse to actually supply their drinking water. So as we look at the environmental state of the drought in California, this is the perfect place to be. But as you mentioned, it’s also just a fantastic area in terms of the access to technology and new innovations that we have. They were talking earlier on some of the panels about us having all the technology we need to treat the water. What we’re doing now with our research is really driving the cost down of those so that everyone will be able to afford it so that it can even be more greatly implemented.
John Shegerian: Got you. And at the Water Reuse Association, what is the greater mission and the goals that you want to see come out of there with your involvement with the Water Reuse Association and given the crisis that we have not only here in California but around the United States and frankly in many parts of the world?
Melissa Meeker: So a big part of what we focus on is the openness of policies regulating reuse. Again, historically we thought of reuse as being a waste stream and a waste product, so we worked very hard across all the states and with other countries to change the thought process and the policies governing reuse to be more of a water resource. So that is a key part of what we spend a lot of time and energy on. We also spend an enormous amount of time on public engagement processes. So coming up with tools that local agencies can use to inform and engage their public so that they understand we’re not talking about really bizarre things. We’re talking about really strong technology, which has been around forever, and we’re coupling it in ways that provides a safe and reliable water source.
John Shegerian: Are you seeing more calls from the media? Is the media more interested now about this, and are you doing more interviews and more thought leadership on this than ever before?
Melissa Meeker: Absolutely.
John Shegerian: And that’s a good thing.
Melissa Meeker: That’s a great thing.
John Shegerian: In terms of visibility, do you get to travel outside of the United States and see other great examples of success stories, which hopefully can beget more success, such as Israel or Singapore or other shining examples of water reuse and recycling?
Melissa Meeker: Yes. So I have been to Israel, Singapore and Australia.
John Shegerian: Wow.
Melissa Meeker: And I’m actually going to Singapore in a couple weeks.
John Shegerian: Great.
Melissa Meeker: So yeah, there are great success stories around the world that we can bring back, but also we’re sharing ideas and concepts with them.
John Shegerian: And that only makes you a better evangelist and ambassador on water use. We’re down to the last minute or so. I just want you to have the final word on your great association, what you’re doing and the future of water technology and water reuse.
Melissa Meeker: Just that this is a fantastically exciting time for water reuse and have an open mind. Ask us questions, and we’ll have the answers and you too will become a fan.
John Shegerian: I love that. You too will become a fan. To become a bigger fan of Melissa’s great organization, please go to www.watereuse.org and you can learn a lot more. Melissa Meeker, we really appreciate your time today.
Melissa Meeker: Thank you, John.
John Shegerian: And you are truly living proof that Green Is Good.
John Shegerian: Welcome to another edition of Green Is Good. This is the IGEL Wharton GE water innovation technology edition of Green Is Good here in beautiful downtown San Francisco, and we’re here with my friend who made this event possible, Jon Freedman. Jon, welcome to Green Is Good, again.
Jon Freedman: Thank you, John. It’s great to be here today, again.
John Shegerian: Well, you were the one when you kindly and graciously came on Green Is Good some months back and invited me up here today, and we’ve been having just such an interesting time with all the thought leaders that you’ve brought together to this great conference that you’re putting on and GE is hosting. First of all, before we get talking about what we’re doing here today, talk a little bit about Jon Freedman, because we had got today viewers and listeners around the world that missed the first time we did this and I want them to hear a little bit about your background in both innovation and sustainability and the creation – little secret here – of Ecomagination at GE.
Jon Freedman: Well, I’ll start with our common connection, the Wharton School.
John Shegerian: Thank you.
Jon Freedman: And 25 years ago – or whenever it was – when I was a lawyer and not particularly thrilled with that career I thought, “Hey. I hear there’s this school,” and it was kind of like a witness protection program. In other words, you could go and kind of change your identity and that was kind of how I looked at it. I had no idea what I wanted to do, but I thought – like all the other people at Wharton – I’d probably go into investment banking or something like that.
John Shegerian: Right.
Jon Freedman: I ended up going to a real estate developer, John, and I became Vice President of General Counsel, but it was owned by a French water company called Suez Environment. So I ended up in the water industry. Fast forwarding, when I joined GE, one of the first things I did was I got to be the project leader for the creation of our global environmental sustainability initiative called Ecomagination.
John Shegerian: Wow. And so you’re a recovering lawyer.
Jon Freedman: Yes.
John Shegerian: And you’re a proud Wharton grad.
Jon Freedman: MBA in Finance.
John Shegerian: MBA in Finance. I mean, my gosh. And now you’re a leader, one of the great leaders of GE Water. And for our listeners out there that want to learn more about GE Water, it’s www.GEwater.com to go learn about what you and your colleagues are creating there and doing in terms of water and technology and innovation to make the world a better place.
Jon Freedman: Exactly. And I actually got to put my Wharton degree to work, because when I joined GE 14 years ago, I was initially the mergers and acquisitions leader responsible for building a water business because GE didn’t have a water business at the time.
John Shegerian: Wow. And you built it, and now there are approximately 1,000 installations or so around the world?
Jon Freedman: First of all, we’re an advanced wastewater treatment technology company and we have 50,000 customers in 130 countries.
John Shegerian: Wow. And you’re in charge. I know your office is approximately four blocks from the White House.
Jon Freedman: Three blocks.
John Shegerian: Three blocks from the White House and you’re in charge of government affairs?
Jon Freedman: Yeah. So I’m the Global Government Affairs Leader but also now the Global Partnerships Leader for the business.
John Shegerian: Wow.
Jon Freedman: So I work with governments around the world but also our kind of largest customers.
John Shegerian: So let’s talk about today. You put together this very important conference. We’re here in Northern California in San Francisco very close to Silicon Valley – maybe the ground zero for innovation in the world, potentially, if you want to look at it that way – in California, where the drought is one of the highest nails in the world in terms of water shortages, and we’re in the middle of 2015. Where are we right now in this evolutionary compendium of water, water technology and breakthrough? And with regards to the visibility that you have, to everything that’s out there including the amazing technology that you have at your fingertips at GE?
Jon Freedman: Here’s where I think we are: Five years ago McKinsey and Company released a report and they said, “Hey, the world has reached a tipping point where demand for water now exceeds supply,” and I think we’re seeing that play out. Not just here in California, which is in now the fourth year of its worst drought in the past 500, but in places like Brazil, which has 13 percent of the world’s freshwater resources. In Sao Paulo, the taps are running dry. In China. In obvious places like the Middle East. But it’s kind of a global phenomenon, so we are seeing increasing water scarcity. There was a fellow here today from the World Resources Institute who talked about that. So that’s the backdrop, increasing water scarcity because of an imbalance between demand and supply. So that really brings up the question: “What do we do about it?” – and I think there’s a lot we can do about it. I think we can solve the challenge. The first thing is we need to conserve water, and that is happening here in California. Governor Brown recently announced a 25 percent conservation goal, right? You had to reduce consumption by 25 percent. The second thing is desalination. It’s a great option to have particularly if you have coastline like California does. But what’s the problem with desalination? It’s expensive and extremely energy intensive. So it’s not great if you’re living in a carbon-constrained world, which we are. Then the third thing you can do is take wastewater, instead of discharging it into oceans and rivers, dirty treat it further so that it can be reused for things like agriculture, industry and even drinking water. And by the way, it uses about half the energy of desalination and it costs about half as much on average. So that is really the thing to focus on as we search for solutions.
John Shegerian: Reuse and recycling because you – GE – has now membrane technology that allow reuse and recycling in both grey and blackwater to be used for everything like as you say commercial, industrial and even home use.
Jon Freedman: Absolutely. You can recover 99 percent of wastewater through the existing technology.
John Shegerian: I just want you to frame this up for our viewers and listeners. This is so important. You shared this with me the last time you came on the show. When you look at the recycling rates – and I want you to share the recycling rates in Israel and Singapore versus California and the U.S. – from a macro level, how does that frame up?
Jon Freedman: Globally, the world is reusing about 3 to 4 percent of its wastewater.
John Shegerian: OK.
Jon Freedman: In the U.S., it’s 6 to 8 percent and here in California it’s 8 to 10 percent – although, I have seen some studies that say as high as 13 percent.
John Shegerian: OK.
Jon Freedman: That’s the U.S. This is good news. Why? Because it means that we have this huge opportunity we can capitalize on to address scarcity, which we’re now seeing. So that’s great. Israel – where they’ve had scarcity forever – they’re reusing 85 to 90 percent of their wastewater today.
John Shegerian: Wow.
Jon Freedman: So that tells you where we can go. Singapore is reusing 30 percent of their water. Why? They want to be water independent of Malaysia. They punch way above their weight in terms of water reuse policies and technologies so they’re doing a great job. Saudi Arabia has announced a plan to go from about 60 percent reuse today to 65 percent. China is mandating water reuse for cites and for certain industries. So it’s kind of – I think – taking root globally.
John Shegerian: Singapore 30. Like you say they punch way above their weight. They – as you shared on the last show – have a clear path for that number to even go up higher.
Jon Freedman: Absolutely. And, John, the reason is not just because the technology they’re using is different from what we can use here in California.
John Shegerian: Right.
Jon Freedman: It’s not. It’s because they put policies in place that are driving more rapid and widespread adoption of these reuse technologies.
John Shegerian: If that’s the case – a couple of points – you just said we’re trending higher than the world rate here in California.
Jon Freedman: Absolutely.
John Shegerian: But lower than some of the better paradigms that are out there now – let’s just look at Israel and Singapore as two that we just discussed. So given that you are the policy person, you are Government Affairs and in charge of partnerships.
Jon Freedman: Right.
John Shegerian: You are literally at the cross-section of where all the action is going to be happening in terms of taking the technologies that exist today – the technologies that GE has and other great companies and iconic brands like GE – and getting it into the hands of governments, municipalities, cities, countries to deploy, to create another Singapore situation, another Israel situation and not be down at 3 or 4 percent recycling and reuse. Is this correct?
Jon Freedman: Exactly. Exactly right. And you know today I just want to commend Mike Connors, the Deputy Secretary of the Department of Interior for the United States who is here at this event in San Francisco. Mike also used to be the Commissioner for the Bureau of Reclamation, which has responsibility for insuring adequate supplies of water in the 17 western states. Now the Bureau of Reclamation reports to him in his more elevated role. There is a lot of interest on seeing that the United States actually does reuse more water, and it starts in Washington and it filters down here to California, where by the way from a policy standpoint – you said from a technology standpoint California is ahead of the rest of the country, well, they are from a policy standpoint too. So we are absolutely on trajectory where I do think we will see much more reuse. And by the way, when more wastewater is being reused, you’ve effectively sustainably increased the supply of water forever.
John Shegerian: I want to hear your vision, though. Since the technology exists, but it’s just all about getting that technology into the hands of the users and convincing them that it’s compelling and giving them a sense of urgency to deploy this, what’s your vision of bridging that gap in the years ahead, so we can get ahead of these problems instead of behind?
Jon Freedman: So I think there are some barriers to adoption of reuse technologies today otherwise you’d see it being used more broadly here in the U.S. like you see it in Singapore and Israel. If you ask me those barriers are things like concern about whether reused water is safe for things like agriculture and drinking water. It’s a lack of clear standards, so a lot of industries don’t know if they can treat wastewater and use it to do something like, for example, wash their chickens in a poultry processing plant. They don’t know because there aren’t clear standards in many cases telling them what is allowable. Then the third thing – and I think probably the biggest of all – is economics. In other words, it’s cheaper to take water from the ground or river or even a potable municipal system, where it’s almost universally underpriced, than it is to implement reuse technologies. So you have to address these barriers, and that’s where I think policy comes into play.
John Shegerian: Let’s go back to, though, the first thing that you brought up. The first data point. Safety. Your membrane technology – that is a slam dunk, that is a layup now, the safety is there. The technology is there to make the water from grey to drinkable, from black to drinkable now.
Jon Freedman: That is absolutely correct, because it’s a physical barrier. You are physically separating the H20 molecules from the bad stuff.
John Shegerian: So now it comes down to public/private partnerships working in conjunction to right-size the policies.
Jon Freedman: I think it’s waiting for water prices to move up – which they are – because as water prices move up then investing in reuse technologies is going to be more cost competitive. I think it’s seeing more communities doing education and outreach like San Diego is doing right now because San Diego is doing a pilot program for direct potable reuse, and as a part of that, they’re not just piloting the technology, they are doing extensive outreach to make sure the community is comfortable with this concept.
John Shegerian: Got you. So is this part of your grand plan of putting together important conferences like today with the thought leaders that you’ve amassed in terms of further messaging this and getting this out as much as possible to the consumers out there?
Jon Freedman: We are absolutely committed to playing the role as a thought leader. We certainly want to be a convener to bring together people who make policies but also people who implement them, and there are a number of general managers of large wastewater agencies here today who are doing an absolutely stellar job. They’re on the frontlines of leading this kind of reuse revolution. There is a guy here named Mike Marcus who is the General Manager of Orange County Water District. He is treating 100 million gallons a day of wastewater and injecting it into the ground to replenish the groundwater supply. It’s the largest indirect potable reuse project in the world. So there are a lot of guys here who are doing incredible work and we’re trying to support their efforts and also help be a voice for policies that will help them reuse more water.
John Shegerian: From a recycling perspective, Jon, in terms of recycling electronics, food, textiles, the national movement has sort of abdicated the role to cities right now, and we’ve seen that in our industry and I’ve seen that also in composting and with regards to textiles. When it comes to water, is more policy going to come out of D.C. on water that is going to then be pushed down and going to help effectuate change here in this country? Or is it going to come from the ground up from the great city leaders that we have like Rahm and like Nutter and De Blasio and Garcetti and the new generation of mayors and other city leaders that want sustainable cities, that want resilient cities? Which way is it going to come? Top down or bottom up or both?
Jon Freedman: It’s both because you have leaders like Mike Connor, who is here today – as I mentioned – from the Department of Interior. You have the U.S. EPA. You have other federal agencies involved who are leading because they’re using their bully pulpits but also they’re creating incentives to promote greater water reuse. You see that through the U.S. Bureau of Reclamations Title 16 incentive program. You see it through EPA’s Clean Water State Revolving Loan Funds which also go to wastewater agencies in part for water reuse. But you’re also seeing the real new regulations coming out at the state level because there is no federal regulation around water reuse. So states like California are actually leading the way.
John Shegerian: Got you. With regards to, I love the story you shared with me in terms of how do you convince others to do the right thing and you shared with me the story of sometimes in your travels, or when you are trying to use a successful paradigm to show off, you actually bring some leadership from Singapore with you to specific regions of the world or meetings and things of that such. Can you share with our listeners and our viewers a little bit about how you use success stories to foster future success?
Jon Freedman: How do you remember this stuff? That’s great. So yeah, I’m happy to do that. Let me just start by saying, as part of our global sustainability initiative called Ecomagination, I also think we lead by example. We have a story to tell about what we did in GE that I think can be example for other companies as well. And you know, John, in terms of water just by virtue of setting a goal – we said, “Hey, we’re going to try to reduce our water consumption by 25 percent” – we have now reduced it by 45 percent.
John Shegerian: Wow.
Jon Freedman: And absent this sustainability initiative, that never would have happened.
John Shegerian: Right.
Jon Freedman: So I think there is more that we can all do individually, but also we do convene events in places around the world. We’ve done it in Shanghai. We did it in Riyadh. We did it in Crotonville, New York. We have the global training facility. And now here in San Francisco. And we have brought the director of water policy from Singapore because they are the world leader. We brought a professor of the water resources economics from Cal-Berkley to Saudi Arabia and we’ve brought the Executive Director of the Water Reuse Association to China. So the idea is to get these thought leaders out there who can truly share best practices in creating policies that will allow for a great reuse of water.
John Shegerian: That’s awesome. Well, I’ll leave any last thoughts before I let you go back to the conference, which you are hosting today. Any last thoughts for our listeners or viewers out there on water, technology, innovation or the great brand – GE – that you represent in such fine fashion?
Jon Freedman: I would just say Green Is Good is the best show on radio, John. Thank you very much.
John Shegerian: Oh that’s so nice of you. And again this is the IGEL Wharton GE edition of Green Is Good in downtown San Francisco. We’ve got Jon Freedman, who is also my friend. He is the Head of Global Partnerships and Governmental Affairs for GE, and to learn more about what GE Water is doing – and GE is doing – please go to www.GEwater.com. Jon Freedman, you are truly living proof that Green Is Good. Thank you so much for everything.
Jon Freedman: You are a great host.
John Shegerian: Welcome to another edition of Green Is Good. This happens to be the Wharton IGEL-GE water technology edition of Green Is Good. We are here in beautiful downtown San Francisco today, and we are so honored and lucky to have with us today Thomas Stanley. He is the Chief Technology Officer of GE Water. Welcome to Green Is Good, Tom.
Thomas Stanley: John, thank you very much. It’s good to be here.
John Shegerian: Well, Tom, today is a very important day here in downtown San Francisco. We’re going to be talking about water and technology. Who better than you to lead off our show talking about water and technology? First of all, how did you become the Chief Technology Officer, Tom? What was the journey leading up to that position? Was this something you always dreamed about as a kid? Was sustainability big in your household or was this something that was learned along the way and really interested you?
Thomas Stanley: You know, it’s a fascinating story actually. I’m a 30-year career GE person, scientist, engineer. I’ve always been in R&D, but most of my career was either with our corporate research organization or with our materials business – plastics and silicones. Then, I remember, I was with plastics in 2001 when GE made the first acquisition that ultimately became GE Water and Process Technologies. I remember thinking, “If that job ever opens up that would be a great opportunity, what a great space and what an opportunity to do something really constructive and useful and important for the world society.” So move forward a few years: GE sold the plastics division, and I went with it, and a couple years later I said, “You know, I would love for an opportunity to get back to GE,” and a water CTO role opened up and here I am. So it was a bit of a dream come true.
John Shegerian: Wow. That is awesome. And how many years ago was that?
Thomas Stanley: That was just about four years ago.
John Shegerian: Four years ago. And where is your office out of?
Thomas Stanley: We are in Trevose, Pennsylvania, which is in between Philadelphia and Allentown.
John Shegerian: Interesting. And for our listeners out there, and our viewers, to learn more about what Tom does at GE – at the iconic and amazing brand GE – you can learn more about everything about GE and water at www.GEwater.com. Tom, your office is in Pennsylvania. Today we are in California. There has been probably no greater time than right now to be talking about water and technology. We’re a couple miles from Silicon Valley. We’re here in California, where it is one of the driest states in the nation probably. Talk a little bit about the importance of today and what you’re going to be sharing with the audience in a little while.
Thomas Stanley: Well, John, a big focus of the discussion or the course of the day is about water reuse. Taking water that comes from a wastewater treatment plant and instead of discharging it – and especially discharging it into the ocean where it becomes seawater – we ought to be able to use that. The technology is available today to be able to take that water and with relatively modest costs to be able to upgrade it as it necessary and to use it again. So it’s a great opportunity for us to extend and use more effectively the water resources that are available to us.
John Shegerian: When you say “reuse,” can another term be called even “recycling” of water?
Thomas Stanley: Yeah, I think those two terms are used fairly interchangeably.
John Shegerian: Are we behind the times in the United States in deploying technology that already exists that companies like yours – GE – has already invented and also manages and installs compared to other countries around the world?
Thomas Stanley: Our team is distributed around the world, so I have an opportunity to travel quite extensively. We have a lab in Singapore. We have a lab in China and in India. And I think Singapore is sort of a shining star in terms of having a very coordinated water policy and very effectively using the water resources that are available to them. So it’s interesting to see both the government municipal interactions there and the focus on water as well as the population and their awareness of water and focus on being very efficient in their use of water.
John Shegerian: Are you saying that’s a paradigm that if we followed here in California and across the United States, we could potentially solve our water crisis and our drought issues?
Thomas Stanley: I think so. We have to.
John Shegerian: Right.
Thomas Stanley: We have to. And there is not one answer. Recycling water from wastewater plants is one knob to improve our water balance and make sure that we have all the water we need. There are infrastructure improvements. People have to be more effective in using water. One thing I noticed recently when I was visiting relatives in California is this shift from irrigated lawns – watered lawns – to going to more natural stone and succulents and things like that. That’s another opportunity for us to use less water. So I think all of these things are going to come together and build a future that is more water resilient.
John Shegerian: So when you say “reuse and recycling of water,” does that include greywater and also blackwater?
Thomas Stanley: Sure. It’s possible to do all of those things or both of those things.
John Shegerian: Is it a political issue more getting people politically motivated? Is it an economic issue? Or is it a social issue in terms of getting people over the mindset that one day they could be reusing grey or blackwater, and it’s absolutely acceptable because the technology is good enough that when you recycle that water, when you reuse that water, it’s absolutely beautiful and clean?
Thomas Stanley: I think the emotional hurdle is with blackwater and this idea of toilet-to-tap that people struggle with.
John Shegerian: Yeah.
Thomas Stanley: The reality is we do that today. Upstream a municipality withdraws water, they treat it for drinking water, the discharge their ethanol from the wastewater treatment plant and then downstream the next municipality takes that water in.
John Shegerian: Really?
Thomas Stanley: So, I mean, the reality is it happens today. We just don’t do it directly. I think the emotional hurdle is if we do that on purpose can people get used to doing that? Now, we talked a little bit about Singapore before.
John Shegerian: Yeah.
Thomas Stanley: Singapore has a initiative they call “New Water,” where they take the wastewater treatment plant – the wastewater effluent – they upgrade the quality and make it absolutely pristine, and when you go to Singapore and you visit the wastewater treatment plant, you get a bottle called “New Water” and it’s right out of that recycle process and you can give it a taste.
John Shegerian: Wow. So they really help market it and help people understand it by doing that, by making that connection.
Thomas Stanley: Yes. Exactly.
John Shegerian: That’s so interesting. Let’s talk a little bit about GE. What we love to talk about on this show are solutions and hope. GE has technologies that if appropriately deployed by our municipalities and our government structures across the United States – both private and public partnerships coming together with GE – we can solve our water issues here in this country.
Thomas Stanley: Yeah. No question about it. No question about it.
John Shegerian: What a hopeful message. I want to share a little funny anecdote. About six months ago – before this issue reached the proportions in terms of the media height that it is right now – I was flipping channels late at night and Jimmy Fallon came on and Bill Gates happened to be on. It was the edition where he brought on different bottles of water – one labeled “poop water.”
Thomas Stanley: That would be Jimmy Fallon, eh?
John Shegerian: Right. And one labeled “regular water.” And Bill Gates was trying to see if he could get Jimmy Fallon to drink the poop water from his technology that he was trying to bring to Africa. Similar to the technology that GE has I assume. It was a very funny episode, obviously, because he eventually tricked Jimmy Fallon into drinking something that he never thought he would drink. But is that kind of messaging and someone who is considered such an industry titan like Bill Gates – and also a philanthropist and thought leader – is that good for the movement of water? Him out on Jimmy Fallon talking about poop water? And is this really our future as we get more used to this idea water, recycling and reuse will become the norm and we won’t – 20 year from now, 10 years from now, hopefully – be living in such drought-stricken times?
Thomas Stanley: Maybe I wouldn’t use the term “poop water,” but I think to have Bill Gates and people like Bill Gates out there talking about this issue, creating visibility, showing that there are options available, I think it’s great and I think it’s very, very helpful. But I should say also that the connection of taking blackwater, treating it and going directly to potable water – there are a lot of things that we can do in the interim before that. But recycle is not exclusively taking the wastewater effluent and going to drinking water, but there are a number of other applications. It can be used for irrigation for example.
John Shegerian: Ah.
Thomas Stanley: It’s used very, very frequently for irrigation, and with a relatively modest amount of treatment, wastewater treatment effluent can be used for those sorts of applications. Or industrial applications. Lots of times industrial facilities will use recycled municipal wastewater to use as the makeup for their cooling towers and other industrial applications. So there is a host of applications that one can use with recycled water – all of which help with the net consumption of fresh water.
John Shegerian: Besides Singapore, here in the United States, which area in the United States is deploying GE technology to help solve the water crisis the best right now in terms of holding them up as a great example?
Thomas Stanley: I think probably California simply because of the recent pressures in this area. But the statistics – as my policy friends tell me – is that in the United States we recycle today something like 3 to 4 percent of our water, so it’s a relatively modest amount. In California it’s maybe 6, 7, 8 percent. So it’s more, but there is still a tremendous opportunity for us to do more.
John Shegerian: How big is the opportunity? What is your goal at GE? When you say, “Wow, we’re getting it done, we’re getting the vision executed,” how much of our water should we be reusing and recycling?
Thomas Stanley: Well, in an arid region, where there is a need to do that, I think it’s not unreasonable to think about 80-plus percent.
John Shegerian: Really?
Thomas Stanley: Yeah. And then Israel is 85 percent recycled, and I think Singapore – as we’ve talked about before – they’re in that same neighborhood. So it’s certainly not unreasonable to think about a very high percentage of wastewater treatment plant output.
John Shegerian: So with more messaging by great leaders like you and more technology being deployed now, there is a lot of hope in the future against the drought and the issue of the shortages of water here in the United States and around the world.
Thomas Stanley: Yep. Absolutely. And again, the recycle is one component. Infrastructure improvements, behaviors in terms of how much water we use, all those things need to come together. But I am very positive.
John Shegerian: Because you have such great visibility on this issue and have so many interesting relationships around the United States and around the world are governments open to this – what you are talking about now? Are municipalities and government infrastructure open to what you’re talking about in terms of solving this crisis and important issue?
Thomas Stanley: I think more and more. In fact, I’ve had conversations with some of the folks who are attending our meeting today, and that is the message that you hear is that the need is so tremendous that in the past where there might have been a misalignment of priorities or measurements between different constituencies that need to cooperate to put a recycle project in place increasingly those interests are aligned, so it’s becoming easier for the in some cases fragmented agencies that have to participate in a recycle project – it’s getting much easier to do that, which is great.
John Shegerian: That’s great. I’ll leave any final words for you for our audience before we have to say goodbye, but I would you to share any final thoughts on this critical topic of water and technology.
Thomas Stanley: John, I really appreciate the opportunity to speak with you and speak with your audience. I think this is a very important topic. It’s a critical topic in California, so it’s very timely that our meeting is here. But I think increasingly it’s going to be a topic of importance across our country, and I think it’s important for people to pay attention to and participate in helping us all work together to make sure that we have all the water we need in the future.
John Shegerian: Well, thank you, Tom. Thank you for your time today. And for our viewers and listeners out there, again, to learn more about Tom’s great work as a Chief Technology Officer of GE Water, please go to www.GEwater.com. This is the Wharton IGEL-GE Green Is Good special edition here in California, talking about water and technology and all the solutions. And GE has the solutions. There is lots of hope out there. Thank you for being with us today. Until our next episode. I’m John Shegerian with Tom Stanley, and we’ll see you soon.
John Shegerian: This is the Wharton IGEL-GE innovation water technology edition of Green Is Good here in beautiful downtown San Francisco and we are so honored to have with us today Heiner Markoff. He is the President and CEO of GE Water and Power and Water and Process Technologies. Welcome to Green Is Good, Heiner.
Heiner Markoff: John, thank you for having me. It’s great to be here.
John Shegerian: We are so honored to have you. You’re one of the great hosts today. And for our listeners and viewers out there, to learn more about Heiner’s great work with his colleagues, please go to www.GEWater.com. Before we get talking about this important conference and what we’re doing here today talk a little bit about your background. How did you get this very important position at the – of course – iconic and amazing brand GE to be leading on this critical issue of water?
Heiner Markoff: Yeah. I’m a long time GE guy.
John Shegerian: OK.
Heiner Markoff: I’ve been with the company almost 22 years.
John Shegerian: Wow.
Heiner Markoff: In different businesses and different positions – a lot of that in the plastics area when we were in that business before we sold it – and I’ve been leading the water business for the last six-and-a-half years and lot of what we do is really developing and marketing advanced water treatment technologies to address the challenges around the world with regard to water scarcity, the water quality aspect of it, helping our customers – industrial as well as municipal – to meet environmental regulations and drive productivity in their operations. So it’s a fascinating, very challenging industry where we are active in, and this discussion today with a lot of thought leaders in the industry is very timely to address some of the challenges specifically in California.
John Shegerian: Right. Well, let’s be honest, you are running one of the leading brands in the world in terms of cutting-edge technology. It’s by design that Wharton and GE came together to host this important conference. We’re sitting in California. We’re in Northern California, specifically close to Silicon Valley – one of the bastions of innovation and technology in the world – and we’re talking about water here and the water crisis but also opportunities here in this drought-stricken state. Talk a little bit about some of the cooler and really cutting-edge technologies that GE Water and Power has that can help us and give us hope that we can solve this problem and we can fix this in our generation.
Heiner Markoff: Yeah. I think the good news upfront is technologies are available to do this.
John Shegerian: Great.
Heiner Markoff: And it’s been implemented in parts of California and other parts of the world – if you look at places like Singapore, Israel, which have faced very challenging situations with regard to water supply.
John Shegerian: Right.
Heiner Markoff: There are several angles to tackle this problem. One is just conversation and storage and driving really basic measures in that respect.
John Shegerian: Right.
Heiner Markoff: But the other way really where technology comes into play is water recycling and reuse.
John Shegerian: OK.
Heiner Markoff: With advanced membrane technologies that we’ve developed and implemented, and we’re working very closely with our customers there. The next part is desalination as another way of making more water available. But we think really the conservation part and the water reuse part are the more economic ways to address these challenges.
John Shegerian: And GE already has the technologies – like you say the membrane technologies – that will allow us to recycle and reuse greywater, blackwater and waters that exist out there.
Heiner Markoff: There are more than 1,000 facilities around the world that use our membrane technologies for water reuse. Mostly, indirect potable reuse, but if you looked at Singapore, for instance, they even put it as potable water.
John Shegerian: So, Heiner, share a little bit with our listeners and our audience around the world – because our audience for Green Is Good is not only here in the United States, but it is a worldwide audience – what are the recycling rates of water and the reuse rates of water approximately in Israel and Singapore?
Heiner Markoff: I think Israel is right now almost at 80 or 90 percent.
John Shegerian: Wow.
Heiner Markoff: Singapore is between – I’d say – 35 to 40 at this stage with a clear path that they’ve laid out to get to 60. And here over in the United States, we are somewhere between six and eight. So there are ways to drive this, to improve this. Proven ways. Technology is available, and I think we just have to have a multi-pronged approach between outreach and education, between policy-making, incentives to really address this from a more realistic perspective.
John Shegerian: Well, you bring up a great point, and I don’t want to get too philosophical here, but Israel and Singapore – as you just laid out – are literally many, many steps ahead of us in terms of their recycling and reuse rates. You’re here today messaging this. This is important, the continuing messaging of the hope and the technology that exists. Why does the media not cover the fact that the technology exists, and what is the push-back here in the United States both on a regional and national level? If the technologies exist, why aren’t we already at 30 or 40 percent? Is it social? Is it political? Is it cultural? What is the push-back?
Heiner Markoff: I think it’s all of it.
John Shegerian: OK. Fair enough.
Heiner Markoff: So I think we’re going to have to have a political come-together of minds to really develop the will to do this.
John Shegerian: OK.
Heiner Markoff: And to drive implementation of these measures and technologies. That is one. The second is clearly a social/cultural thing where you just have to overcome the thought that we reuse water. But again, the technologies are there to get any wastewater to drinking water standards. There are a lot of technologies and measures that support that and make sure that health requirements are met. So I think the technology is available. We need to develop the political will, and we need to educate and reach out to make sure that people understand what’s available, what’s the best available technology and also need to understand that these technologies are safe and being used around the world.
John Shegerian: So really you’re bringing a message to our listeners and to the audience today. This is truly a message of hope. The technology exists. It’s just now overcoming some of these other barriers and hurdles.
Heiner Markoff: Right. And we continue to work on technology developments to get to the next level and a lot of it is related to improving the cost, getting more cost competitive because at the end of the day it goes into what all of us have to pay for for our water.
John Shegerian: Right.
Heiner Markoff: But now we are continuing investments in developing the next generation of membranes, the next generation of energy-efficient ways to reusing, recycling and treating water. So I think the basics are there, the hope is there, and I think we’ve got to educate, reach out and drive political will in our society to make it happen.
John Shegerian: Well, Heiner, you are the person to make it happen. I’m going to leave you with the last words. This is your conference. I’m going to leave you with our listeners and our viewers with the last word before we sign off today. So given where we are and what is going on and what you know and because you have visibility not only here in the United States but around the world, share what you think the couple years ahead for GE and water innovation and technology has in store for all of us.
Heiner Markoff: I think the message here is innovation will help solve the drought problems that we have around the world. We are investing in it, the industry is investing in it, we are working together with our customers both on the industrial side as well as on the municipal side to really improve these technologies to implement those, make them more cost-efficient every day and help address the challenges that we have, because if you really look at it, water is a prerequisite for economic growth, for population growth, and if you overlay maps – and I think you had another interview with Aqueduct before….
John Shegerian: Right.
Heiner Markoff: If you overlay those maps, a lot of the areas of economic development and huge population growth are areas that lie in regions with severe droughts. So we need to develop. We need to think about this. We need to develop these technologies, implement those technologies to continue to progress the world.
John Shegerian: You have 1,000 installations today and I hope you have another 1,000 really soon. It will make the world a better place. We really thank you for all your great work, Heiner, at GE – the leading brand in water technologies around the world. Thank you very much. For our listeners out there, to learn more about Heiner’s great work at GE and all of GE’s great work in leading technologies in water and power, please go to www.GEWater.com. Heiner Markoff, you are truly living proof that Green Is Good. Thank you very much.
Heiner Markoff: John, thank you.
John Shegerian: Thank you.
John Shegerian: Welcome back to Green Is Good. This is the Wharton IGEL-GE innovation water technology edition of Green Is Good, and we are here in beautiful downtown San Francisco and we are so honored to have with us today Charles Iceland. He is the Aqueduct Director at the World Resources Institute. Charles, welcome to Green Is Good.
Charles Iceland: Thank you so much, John. Pleasure to be here.
John Shegerian: It’s so nice to have you here. Before we get talking about what we’re doing here today, and what you’re going to be doing in terms of your comments to this important audience, can you share a little bit about your story, Charlie, leading up to becoming the Aqueduct Director and how you even got to that place?
Charles Iceland: It was not a direct line journey, John. I grew up living abroad. My father was a State Department official. We lived in Latin America, in South America, in Mexico. We also had a tour of Southern Europe. We lived in Northern Greece. And I guess what turned me on to environmental issues in, I guess, the late 1970s-early 1980s was the fact that we lived in beautiful places on the water cut kind of where we are now.
John Shegerian: Yeah.
Charles Iceland: Beautiful vistas. But the places where I lived in Northern Greece would dump raw sewage into the bay.
John Shegerian: Wow.
Charles Iceland: And the bay smelled like you would expect it to smell and you had to drive at least an hour to get to a swimmable beach. I thought that was a tragedy of mankind. I lived in Mexico City for nine years as well growing up, and I saw that city transform from a beautiful city surrounded by snow capped volcanoes to a city where you just couldn’t even see partway across the city anymore this fog had gotten so bad. So it was personal for me, my interest in the environment.
John Shegerian: And when did you join the World Resources Institute?
Charles Iceland: I joined WRI in 2006. About eight years ago.
John Shegerian: And what does WRI do? And for our listeners and our viewers out there, to learn more about WRI, please go to www.WRI.org. What does the World Resources Institute actually do? What is its mission?
Charles Iceland: Well, the World Resources Institute was created in 1982 – about 33 years ago. It was the first think tank of its kind to look at global natural resource issues. We look at the whole host of natural resource issues from water to forests and the problem of deforestation to the issue of climate change and energy. We look at the issue of food and weather. We can produce food in a sustainable manner for 7 billion today, 9 billion by 2050. So we look at those issues from a non-partisan perspective, and we publish our results. In the past, we published a lot of monographs and papers. Now a lot of it is online. Very data intensive.
John Shegerian: That’s great.
Charles Iceland: Changing of the times.
John Shegerian: Does it also cover in terms of natural resources energy? Does it also cover metals and rarers and stuff of that nature?
Charles Iceland: We do look at energy, the issues of overreliance on fossil fuels and the possibility for replacing those with clean energy sources – wind and solar. We promote that actively with groups of private sector organizations. We don’t look at mining and minerals too much.
John Shegerian: Got you. Aqueduct Director – I’m just so fascinated by the title.
Charles Iceland: Yeah. So about five or six years ago a colleague of mine who is no longer there, Pete Clopp, and I and another colleague, Tien Chau, had the vision of creating an online system where we could measure and map a host of water risks globally.
John Shegerian: Oh.
Charles Iceland: We intended the initial users to be corporations and investors who had interests across the world. This tour would operate as kind of a prioritization tool for them to figure out where they needed to dedicate their staff time and their financial resources to insure themselves against these risks.
John Shegerian: Got you. So today you’re here and you’re speaking at this event hosted by Wharton IGEL and also our great friends at GE. Share a little bit about your thoughts on why now, why here, sitting here in beautiful California not far from Silicon Valley and the critical issue surrounding both the problem of the drought here in California and across the nation, and in many ways around the world, but also the innovation and technology and the hope that exists.
Charles Iceland: Yeah. Well, most people aren’t motivated to change the status quo until a crisis comes along. And a crisis has come along – we’re at levels of snow pack that are unprecedented – 5 or 10 percent a snow pack. We’re seeing in this conference levels of rainfall that are falling below even the lowest thresholds we used to see. So there is a crisis, and that is the motivator for really good possibilities that exist to drought-proof California – at least the major parts of California – both its population and its economy. California as opposed to most other places around the world has a lot of financial resources. People complain there are not resources. There are resources here when it comes to securing your lifeline, which is what water is. We also have a lot of technologies that can be applied here. We can reuse the water we use in our homes, in our industries, in agriculture. We can reuse it much more than we do today. I think in California reuse rates run somewhere between 8 to 13 percent. That is, pardon me for saying it, pathetically low when you compare it to Israel, which is in a desert, recycling I-don’t-know-what but maybe 60 or more percent of their water. That’s how they survive in a desert and thrive. California can survive and thrive. My concern for California is agriculture. That’s what uses 80 percent of the water. That is what is really at risk here. I worry not only about California’s agriculture but many of the other areas of the world that serve as our humanity’s bread baskets.
John Shegerian: Right.
Charles Iceland: All the major bread baskets are coming under pressure. We see bouts of drought. We see declining groundwater levels, because people are pumping more out of the ground than is being replenished. So the issue of food security is great, and I think we’re going to see a lot more of the types of protests we saw in the Middle East in 2008, in 2011, where poor people who are spending upwards of 50 or 60 percent of their take-home income on food. What we’re looking at here is food prices increasing and those people not being able to feed themselves. That’s what keeps me up at night.
John Shegerian: Wow. In terms of what you’re seeing it’s a fascinating frame of theses you just put up in terms of tying back out water crisis with food scarcity.
Charles Iceland: Yes.
John Shegerian: Which is real as we know here in California, which we are one of the great providers of the food for the United States and around the world, and as you say, there are other great food baskets around the world that are under that kind of pressure. Given what you know, though, about the water technologies that exist – like you point out Israel is deploying this in a great way, Singapore is deploying it in a very successful way as well – do you feel hopeful that the food scarcity crisis won’t pass a horrible tipping point if we get with it now and deploy this technology faster rather than slower? Or the better question, Charlie, is what is pushing back on the appropriate deployment of this very doable and usable technology that already exists?
Charles Iceland: Well, there are ways to use water more efficiently in agriculture.
John Shegerian: Right.
Charles Iceland: And let me explain why agriculture is so important.
John Shegerian: Yeah.
Charles Iceland: Agriculture accounts for 80 percent of our water use, and it’s true in developing countries, it’s true in most developed countries, it’s true here in America. Of the water that is used and then lost to the system until the next rainfall, 80 percent of that is for agriculture. And see here’s the problem, John, they’re telling us we need to increase our agricultural production by 70 percent in the next 35 years to accommodate both a growing global population – so we’re going to move from 7 to 9 billion – and to accommodate a population that is eating more meat-intensive diets. Those two drivers are requiring us to increase our food production. On the other hand, the resources available for food – water and land – are maxed out and we are going into our groundwater. It’s like going into your savings account and just spending your savings.
John Shegerian: Which is already overdrawn.
Charles Iceland: With abandon. Yes.
John Shegerian: Right.
Charles Iceland: And that is my real concern. Can we somehow rethink our agriculture and food policies to accommodate this big pressure? Can we avoid greater wastage and loss of food? About 30 percent of the food we produce – maybe 25 or 30 percent – is lost or wasted. And that represents about 20 percent of the water we use worldwide. If we could cut that down to zero, I mean, we would make great strides towards improving both our water security and our food security.
John Shegerian: Well, I’m going to leave you for any last words before we sign off today, because I know we both have to get back to the bigger conference, but I’d like to leave you with any final thoughts on what you’re doing at World Resources and what we’re doing here today at this wonderful Wharton-GE event.
Charles Iceland: I mean, I think this is a global problem that requires a lot of people coming to understand what the issues are, looking at the information, changing attitudes towards our resources. So what I hope to do through Aqueduct, what I hope we do through this conference is to further increase people’s knowledge out there so they can use this knowledge to participate in this effort.
John Shegerian: Well, Charlie, you’re always welcome back on Green Is Good to further the message of what you’re doing at the World Resources Institute and to further the message of the limited natural resources we have in this world and how we can come up with solutions that can put us in a better place. We really thank you for your time today. For our listeners and viewers out there, to learn more about what Charlie Iceland and his colleagues are doing at the World Resources Institute, please go to www.WRI.org. Again, this is John Shegerian and Charlie Iceland from the Wharton IGEL-GE innovation technology water resource conference in beautiful downtown San Francisco. Charlie Iceland, you are truly living proof that Green Is Good. Thank you very much.
Charles Iceland: Thank you so much, John. A pleasure.
John Shegerian: Welcome to another edition of Green Is Good. This is the Wharton IGEL GE water innovation edition of Green Is Good here in beautiful downtown San Francisco. We are so honored to have with us today Dr. Eileen O’Neill. She is the Executive Director of the Water Environment Federation. Welcome to Green Is Good, Dr. Eileen O’Neill.
Eileen O’Neill: Thank you, John.
John Shegerian: Eileen, you’re going to speaking later today on a panel. Before we get talking about your thoughts and everything on why water, why today, why California? I’d love you to share a little bit about your journey. How did you get to this position? Was this something that was always on your heart and mind growing up as a young lady, or is this something that happened to you along the way, you learned about the importance of water and our problems with regards to water and you got involved during your journey?
Eileen O’Neill: Well, thanks, John. No, I came into water through the Federation. I’m actually an environmental scientist by training.
John Shegerian: Oh.
Eileen O’Neill: And grew up in the U.K. and was a professor and a consultant there and also a consultant here. I was more working on broader environmental issues but had the good fortune – for a variety of reasons – to join the not-for-profit – the Water Environment Federation – and got into water about 20 years ago and have never looked back. I feel extraordinarily privileged to work in water and to work with water professionals because my organization is sort of like the AMA for water environment engineers and scientists. It’s a professional organization. Water people are different. They have such passion for what they do and such a culture of service so to be able to work with them is really a privilege, and I cannot think of a more exciting time to work in water than right now. So I feel very privileged to be where I am now.
John Shegerian: That’s so nice. And before we get talking about today’s events, specifically, share with our listeners and our viewers what you do and what the water environment federation is – WEF. And for our viewers and listeners out there, to learn about more of what they do and Eileen’s great work with her colleagues, please go to www.WEF.org. What is the Water Environment Federation exactly?
Eileen O’Neill: Well, the Water Environment Federation – as I said – we’re a professional society for primarily engineers and scientists who work on broad water issues. We were started in 1928 by state organizations and very quickly went international. We had the very glamorous title of being the Federation of Sewage Works Association in 1928, and as you can imagine, that would not be a great name to have today. But the reason we were founded was the recognition that to address our water issues you really need a broad perspective. We were founded to publish a research journal and to organize a conference, and we still do those things today, but our conference has grown to be the largest annual water conference and exhibition in the world and it’s called “WEF Tech.” We still do those things. We also offer a very important platform for water professionals of all stripes – people who work for GE, people who work for EPA, people who work for San Francisco public utilities – to come together first and foremost as professionals to talk about the consensus of the profession on what the most important issues are and how to deal with them and what are appropriate practices. And I would say the other thing that we do now that was not initially thought of when the organization was founded was we work on policy issues and educating the public, and I think that’s a sign that these water issues are so big and so challenging that we can’t just talk to ourselves as professionals, we have to get the policy makers and the public on board if we are going to manage water effectively.
John Shegerian: So it’s for scientists, engineers, professionals, policy, everyone can be members of WEF if they so choose.
Eileen O’Neill: Yes. And I think that’s one of our strengths and what we try to bring to defining what’s an effective approach or what our stance should be is we always try to get that diversity of perspective. As I said you could work for GE. Our person who is going to be presenting next year works for Coca-Cola. You can be a regulator. But people bring to that their commitment to bring the best in technical practice and the consensus for the profession on policy issues and we think that is the strength of the organization.
John Shegerian: And where is your annual conference, the one that is the world’s largest?
Eileen O’Neill: It moves between New Orleans and Chicago because it is so large. I know you’re talking to people about equipment.
John Shegerian: Right.
Eileen O’Neill: And this is some heavy duty equipment. I’m a scientist, and when I first joined the Federation and went to my first WEF Tech, I was just blown away by the enormous pieces of equipment. So our strength of being the largest conference in the world is also a little bit of our challenge in that we need a lot of space, we need a lot of load-bearing capacity so we are limited.
John Shegerian: Because you actually show the equipment there that is state-of-the-art, so it is a trade show in many ways.
Eileen O’Neill: It is a trade show, a technical exchange, an educational form and initially we picked – for business reasons and for limitations of size – Chicago and New Orleans. But it has ended up being two great locations and very diverse locations to talk about water and the importance of water. You think about the challenges of New Orleans, you think about the water opportunities and what water means to Chicago, they have ended up being great locations to bring global professionals to to talk about water.
John Shegerian: That is so wonderful. And that is an annual event, and what month is that typically in?
Eileen O’Neill: It’s typically late September or early October. This year it’s in Chicago so we’re expecting it to be especially big because of the amount of population around Chicago and the ability for driving traffic and also what a great international destination.
John Shegerian: And how many days is it for?
Eileen O’Neill: It is three days of the trade show.
John Shegerian: Wow.
Eileen O’Neill: But the educational workshops, the technical sessions go for about five days and we will have 1,000 companies and probably over 24,000 attendees at the event. It’s really big.
John Shegerian: Wonderful. That’s wonderful and that’s amazing. And again, for our listeners, we’ve got Dr. Eileen O’Neill. She is the Executive Director of the Water Environment Federation – WEF. You can learn more about Eileen’s work with her colleagues at www.WEF.org. Eileen, we’re here today at Wharton IGEL GE and we’re talking about water, innovation, technology. We are here in San Francisco, California, a couple miles away from Silicon Valley. Why water, why now, why right here? What is the importance of all these convergents of the necessity and the sense of urgency that we have to not only talk about it but to act on the talk now? Are we in more dire straits than ever when it comes to water here in California and around the world? And what can we do? Share a little of the problem and the hope.
Eileen O’Neill: Certainly. What a fantastic setting to be talking about water. I think the world is watching what is happening in California and what approaches are being taken. So I think California has the opportunity to lead the way. However – and what we’re seeing here in California – are challenges that will ultimately be faced throughout the world given the challenges of growing populations, urbanization, the challenges of climate change so it is a very challenging time to be in water. The opportunity that we have is that it also puts focus on water. And finally we are learning and California is learning, and if you start a conversation with your cab driver or with members of the public here in California, you see an unusual level of awareness not just about water challenges but some of the details of the challenges and the opportunities. So it does give us the possibility of looking at managing water differently. And as you and I were chatting as we warmed up.
John Shegerian: Yeah.
Eileen O’Neill: It is not a technology problem. We know how to manage water better. We have taken a rather fragmented approach to managing water but if we seize the opportunity to think about a more holistic approach to managing water and we think specifically – obviously being on the water environment side, on the what used to be called “wastewater” side of the house….
John Shegerian: Right.
Eileen O’Neill: We do not in my organization consider “wastewater” to be a waste. We consider it to be a resource. A source of water that can be used again. A source that nutrients can be recovered from. A source of embedded energy that renewable energy can be extracted from. So it is a time of challenge but also opportunity. And let’s not let a good crisis go to waste. Let’s use the opportunity to increase public awareness and the public’s trust to allow us to take some of these more innovative approaches.
John Shegerian: So the innovation exists you’re saying. The technology is there. We need to message more and get it out there which is why you are here and these other great leaders are here today speaking about this important issue of water and technology and innovation. But then where are the push-backs coming? Are they social and political? Are we not just getting people at the table to create public/private partnerships that then can afford these solutions to the communities around the United States and around the world? Where are the challenges?
Eileen O’Neill: Well, obviously, when you’re dealing with issues of public health then one really does need to make sure that we answer all of the questions, say, with recycled water if we’re looking to go to a potable reuse situation. But also there is a lot of money involved. You’ve probably heard that our systems are old and some communities have not been able to raise rates to invest so there is a need to connect more with the public and have them understand and be willing to raise the rates to invest. Also I think – you mentioned public/private partnerships – some of these issues require regional solutions and at least on the westward side we have not had a tradition in this country of private investments. So there are a number of institutional barriers, but we are also a relatively risk averse profession. Obviously, we’re dealing with issues of public health and protection of the environment, and we at the Federation are leading some of those conversations about risk management and conversations with regulators about perhaps providing what we would call a little bit of space to innovate. So it’s about what is an appropriate level of risk and who should bear the risk, and then also perhaps a little bit of space within our permits and our other regulatory constraints in terms of the ability for utilities to innovate.
John Shegerian: Well, I look forward to our panel later today. I’ll leave you with the last words if you have any last thoughts for our listeners and our viewers before we sign off here on Green Is Good. What would you like to share before we do our panel later today?
Eileen O’Neill: I think just that this is an incredibly exciting time to be in water, that we face some incredible challenges – not just here in California and in the U.S but also around the world – but we know how to solve those challenges. It’s an opportunity to innovate, to look at – particularly on the wastewater side – wastewater as a resource. As I said, we do not use the term “wastewater,” we do not use the term “wastewater treatment,” we use the term “water resource recovery” because we believe we operate water resource recovery facilities and that kind of an approach can be an important contribution to solving some of the water challenges.
John Shegerian: Thank you so much. And for our listeners and our viewers out there – Water Environment Federation – to learn more about what Eileen and her colleagues are doing and all those innovators and scientists and engineers, please go to www.WEF.org. Eileen O’Neill, you are truly living proof that Green Is Good.
John Shegerian: This is the Wharton IGEL GE innovation-water-technology edition of Green Is Good here in beautiful downtown San Francisco. We are so honored to have with us today Dr. Vincent Tidwell. He is a distinguished member of the technical staff of the Sandia National Laboratories. Welcome to Green Is Good, Doctor.
Vincent Tidwell: Thank you, John. I’m glad to be here.
John Shegerian: Vincent, this is obviously an exciting day here with so many thought leaders like you talking about water, innovation and technology. Before you and I get to that, though, I just want you to share with our listeners two things – your journey leading up to your position at Sandia and then what Sandia actually does.
Vincent Tidwell: Sure. Well, I guess my journey to Sandia began in high school – an interest in science altogether – then started in geology as an undergraduate, but from there, was kind of hit by economic issues with the decline in the petroleum industry. I had to find something else to do and that’s when I got into water going to the University of Arizona and on into New Mexico Tech then later on for advanced degree in water and hydrology. So I’ve always just been interested in water and how it connects and is so important to everything that we do.
John Shegerian: And how long have you been at Sandia?
Vincent Tidwell: Twenty-five years.
John Shegerian: And what is Sandia? Explain to our viewers and our listeners what is Sandia National Laboratories?
Vincent Tidwell: Sandia National Laboratories is what they call a “go-co,” a government-owned, contractor-operated facility for the Department of Energy. So, basically, we support the Department of Energy on a wide range of research initially coming out of developing the nuclear weapons. But beyond that time, we’ve expanded to look at all kinds of energy and environmental issues as well.
John Shegerian: And for our listeners and our viewers out there, to learn more about what Dr. Vincent Tidwell and his colleagues do at Sandia National Laboratories, please go to www.Sandia.gov. Vincent, can you share a little bit about why you are so excited to be here today talking about water, technology and innovation right here in California. We are close to Silicon Valley, and this seems to be a topic that the media is finally giving a lot of coverage to. What’s your interest level here today in terms of what are you going to be sharing when you do your panel later today?
Vincent Tidwell: Sure. Well, specifically, my interest specifically in water is around energy and the connection between water and energy. Energy is the largest user of water in the United States – even more than agriculture. It also consumes about 12-13 percent of all the electricity or energy used in the United States goes to moving and treating water. So I’ll be talking a little bit specifically about wastewater and the energy use there and also the opportunities to use the waste products. There is a lot of energy in those and so actually trying to move that to an energy neutral process.
John Shegerian: When we think about innovation and water technologies today are there some that trump others? For instance, in terms of turning blackwater or greywater back to drinkable water versus desalination. In terms of the energy profiles, which one is more energy efficient, and if you were recommending one to a municipality or to a region, do you have favorites that you recommend because of energy issues, or how do you factor in the algorithms in terms of need, energy and also population basis?
Vincent Tidwell: Well, that is a loaded question. There are a lot of issues there.
John Shegerian: Yeah.
Vincent Tidwell: And really there are two different issues. One would be the primary water supply. That’s usually where you would get into desalination.
John Shegerian: Right.
Vincent Tidwell: So looking at removing largely salt from the water, and there are a variety of technologies there having to do with membranes, reverse osmosis to distillation – basically, how God creates rainwater, right?
John Shegerian: Right.
Vincent Tidwell: And turning these into processes that we can use to effectively remove the salt from the water. The big issue there is always energy. Energy is usually the limiting factor there in terms of cost.
John Shegerian: I see.
Vincent Tidwell: So there is a wide variety of opportunities that we are looking at there across the lab complex, but most of them are really looking at reducing that energy burden.
John Shegerian: Got you. So that is what you are doing. You’re factoring in energy and solutions and trying to bring solutions using less energy hopefully.
Vincent Tidwell: Absolutely.
John Shegerian: Got you. I know one of the issues – and we’re going to be talking about it later today, I just want to give a little teaser to our viewers and listeners out there on Green Is Good – I know one of the issues that are near and dear to your heart is thermal electric power.
Vincent Tidwell: Yes.
John Shegerian: Can you explain just in brief what that means?
Vincent Tidwell: Sure. So about 80 percent of our current fleet of power plants are thermal power plants. That is, it uses a boiler, it heats up water to steam and then you have to turn that steam back into liquid water so you have to cool that water down. So that is the thermal electric process. Either you are using coal, oil, natural gas to heat that water. Well, to turn the steam back down into liquid water you have cooling towers or either an open loop system where you run basically a river through your condenser to cool the water down. So either of those processes use a lot of water and/or consume the water through evaporation to cool the water down. And as I mentioned earlier, that cooling process is the largest user of water in the United States.
John Shegerian: Got you. And we’re going to be talking more about that on the panel today. Innovation, technology, water. We know how bad the problem is. Are you hopeful as we sit here today in 2015? Do the innovations and technologies exist to help us overcome our drought issue here in California, across the United States and hopefully around the world? And are you feeling hopeful now given that you have 25 years of great experience behind you but still a huge future in front of you and also the knowledge that you have? How are you feeling today in 2015?
Vincent Tidwell: Absolutely. In fact, there is one really great example of how technology has really changed the water footprint of energy and that is with the lowering cost of natural gas through the hydraulic fracturing and the directional drilling that has opened up whole new reservoirs of natural gas reducing the price of natural gas which has made a huge shift in the kinds of power plants that we are building today as well as the move to a lot of renewables. And so this move to natural gas and renewables to generate more and more electricity has a much, much smaller water footprint than we see with our traditional coal or nuclear. And so that one move there is making a huge change in the way our energy demands for water going into the future are looking. A lot of other types of technology are out there in the wings that could move us much further ahead in many other areas as well.
John Shegerian: But you are feeling hopeful?
Vincent Tidwell: Absolutely.
John Shegerian: And that’s great. I’m glad you came today. I’m glad you shared with our listeners and our viewers a little bit of what you are going to be talking about. Any last or final thoughts today before we sign off this edition of Green Is Good?
Vincent Tidwell: Well, I’m just glad we’re having this dialogue. It’s very important. I think the drought here in California is a good rallying issue to be looking at it but it will be gone hopefully soon but we can’t afford to lose that momentum that we are developing around the issue right now.
John Shegerian: Thank you and thank you for your time today. For our listeners and our viewers out there, to learn more about what Dr. Vincent Tidwell and his colleagues are doing at Sandia National Laboratories please go to www.Sandia.gov. This is the Green Is Good Wharton IGEL GE Innovation Technology edition of Green Is Good. We are here in beautiful downtown San Francisco. I’m John Shegerian with Dr. Vincent Tidwell. Doctor, you are truly living proof that Green Is Good. Thank you very much for your time today.
Vincent Tidwell: Thank you very much.
John Shegerian: Welcome to another edition of Green Is Good. This is the Houlihan Lokey edition of Green Is Good. We are here in beautiful New York City, New York, and we’re so honored to have with us today Sean Epps. He is a partner a Snow Phipps. Welcome to Green Is Good, Sean.
Sean Epps: Thank you, John. Thank you for having me.
John Shegerian: Great. Sean, what are you doing today? What are you so excited about at the Houlihan Lokey Conference, and why did you come here today?
Sean Epps: Houlihan has been a great partner of Snow Phipps for a very long time. We’re a middle market private equity firm that overlaps well with Houlihan’s capabilities, and we recently bought a business during a Houlihan process. The business that we bought is called “Cascade,” and it’s in the environmental services space. Aside from the specifics of Cascade, we have been coming here to the Houlihan Conference for years now. It’s one of the best conferences in the industrial space, particularly in the lower to middle market, and we’re happy to be here.
John Shegerian: That’s great. Talk a little bit about your company – Snow Phipps. And for our audience that wants to learn more about Snow Phipps, you can do to www.snowphipps.com. What’s the premise of Snow Phipps? And talk a little bit about the history and your investment strategy.
Sean Epps: Sure. Happy to do that. We are a middle market private equity firm that’s focused on completing transactions that work well with our operating model. Our operating model is one where we bring very senior operating partners to the table to help us evaluate companies and areas that we want to invest in, and then, once we buy businesses, we work with our operating partners to enhance the businesses that we buy.
John Shegerian: So you just recently invested in Cascade. What was the business proposition? What business is Cascade, in and why were you excited about investing in Cascade?
Sean Epps: Cascade is one of the leading environmental services businesses in North America. They have a heritage across a number of decades as an industry leader in several services that you would see on a brownfield environmental site. They have site assessment capabilities, they have drilling capabilities and they have a segment of remediation capabilities that we are excited about driving in the future.
John Shegerian: Got you. And is this your first environmental investment, or you have other investments in the sustainability space prior to Cascade?
Sean Epps: Snow Phipps is a veteran in the environmental space. We have had a portfolio company in the space for quite some time and we think this is a space that we know well, which is always important in investing but we also think the environmental segment is an area that has very strong growth prospects over a very long time horizon.
John Shegerian: In terms of a social trend, sustainability is here to stay, socially speaking, in America, and the revolution is both underway and growing as a trend and that’s why your company – Snow Phipps – likes to look at potential investments in this area.
Sean Epps: Absolutely. And we see a number of reasons for its viability on an economic basis as well. We know from other investment themes that we’ve worked over the history of our firm where – for instance – natural resources, very expensive. And if natural resources are very expensive that means that amongst a variety of different things that means recycling and environmental sustainability is an important potential of that trend.
John Shegerian: So that’s why you like to come to this conference? Because you spend one day here and you get exposure to a lot of great new and upcoming businesses that you can potentially invest in?
Sean Epps: That is correct. And we stay in front of the trends and the themes in what people are thinking, so this is very helpful to be here at the Houlihan Conference.
John Shegerian: That’s great. Well, that’s great. For our audience members out there, to learn more about Sean’s great company, you can go to www.snowphipps.com. Sean, we’re so happy that great people like you are investing in the future of sustainability and making the world a better place. You are truly living proof that Green Is Good.
Sean Epps: And thanks for your spokesmanship, John.
John Shegerian: Welcome to another edition of Green Is Good. This is the Houlihan-Lokey edition of Green Is Good, and we’re here in beautiful New York City, New York, and we’re so honored to have with us today James Devlin. He is the CEO of ReCommunity Recycling. Welcome to Green Is Good, James.
James Devlin: Thank you. Pleasure to be here, and I look forward to a lively conversation.
John Shegerian: Yeah. And we’re going to be talking about our favorite subject – recycling – but before we get talking about recycling, I want you to share with our audience the James Devlin story. How did you get here, and how did you become the CEO of one of the largest recycling companies in America?
James Devlin: I often wonder how I got here. But thanks for asking. I’ve been the CEO for ReCommunity for the last couple of years. Prior to that, I was the CEO of a company called “Thermo Fluids,” which was the third largest collector and processor of waste oil – so again in the environmental services space. I really enjoyed that business, and ultimately, we sold that one and that has enabled me to come and work for ReCommunity. And before that, about roughly 20-plus years in the environmental services businesses from [inaudible] industries to Waste Management so I’ve always had my fingers in that sustainability and recycling pie so to speak, and obviously, I’m just thrilled to be able to continue to pursue that in the current day.
John Shegerian: And for our audience members out there – ReCommunity – to find James’s great company, you can go to www.recommunity.com. What does ReCommunity Recycling do when you come to a city or to a municipality?
James Devlin: OK. Great question. What we do is we are the largest independent processor of the curbside generated municipal material – recyclables.
John Shegerian: Wow.
James Devlin: The third largest in their space. Basically, what we do is we’ve got 31 facilities in 14 states.
John Shegerian: Wow.
James Devlin: We don’t collect it, we don’t dispose of anything. Our sole mission in life is value extraction from the commodity stream, and we’ll process about 12 different commodities and then ultimately we go from industrial processing, if you will….
John Shegerian: Right.
James Devlin: To worldwide marketer of commodities all over the world. In terms of volume, we’ll sell to China, some goods to Europe. Obviously, a lot stays here domestically as well. Our company employs 1,500 dedicated employees that their sole mission in life is obviously to be safe and environmentally compliant. Everyone likes their role in life, because they are doing something that is important in terms of sustainability. They love what they do.
John Shegerian: Your company every day makes the world a better place.
James Devlin: I believe so. That’s our mission.
John Shegerian: That’s right. So what today – given we’re in 2015 and we have competing trends out there right now, James. The sustainability revolution is on fire in many ways here in America, especially with Millennials and the next generation. But we’re facing this world where commodities have taken a dip for a while. Talk a little bit about both the challenges and the great opportunities that are in front of your company ReCommunity?
James Devlin: Absolutely. First if you think about it – our industry – it’s a $25-billion industry, employs millions. I think the payroll in our industry is over $20 billion. It’s amazing. It’s 2 percent of GDP, so it’s a massive-sized industry that we’re in, and that’s the good news, and there a lot of sustainable jobs that can be developed. Right now, if you look at the waste stream, only about a third of it is currently being diverted today. And I think the real opportunity into the future as these programs continue to mature, technologies continue to evolve and just as importantly markets for these commodities continue to develop, more and more materials will be diverted from the stream, which represents a significant amount of growth for ReCommunity but also our municipal partners as they think about their mandates and in terms of environmental sustainability. Now you talked about the decline in commodity pricing.
John Shegerian: Yeah.
James Devlin: If you look at this snapshot in time, you’ve got what we call a “perfect storm,” and others call it something a bit more graphic. But if you think about it, you’ve got a decline in commodity pricing. You’ve got rising labor costs, because the economy is getting better and also there are a lot of wage requirements by states and continue to drive our single largest cost component. Then you’ve got increasing costs as it relates to processing this material from a maintenance standpoint and a processing standpoint. Then, lastly, I think you talked a little bit – and maybe you’re leading up to it – the composition change in the waste stream, in the value stream that we’re looking at. And our biggest concern is inbound quality. It’s not necessarily that ONP – old newspapers – as a percentage is dropping and OCC is increasing. Our biggest concern and our biggest challenge today is MSW and contamination in our inbound stream, which obviously it’s a safety issue for our people. It’s an economic issue if you think about we go through all this effort to process this material, and roughly 15 to 20 percent of what we process ends up going back to the landfill. It’s incredibly inefficient to do that. And then obviously it’s an opportunity cost at our MRFs – or material recovery facilities – because they compete with our technologies for separation and diversion. They bind screens. They make it much more difficult to separate out these high value commodities and return them to market. And then our most important concern is obviously the safety of our people.
John Shegerian: Right.
James Devlin: It exposes our people to materials.
John Shegerian: Share what you mean, though, about contamination, because our audience should hear this. This is a very important message that’s not discussed well enough by experts like you on a regular basis. Share what you mean by “contaminated waste streams.”
James Devlin: Yeah. If you think about where it’s generated, you always have to go back and you go back to the consumer, right?
John Shegerian: Right.
James Devlin: And so many times – and I even see it with my own family as I continue to kind of crawl through our recycling bin like a raccoon sometimes – but when I see what’s going in there – and people refer to this as “wishful recycling” that’s just “when in doubt, put this in the bin because there’s an outside chance they might be able to recycle it.” So you see Styrofoam. You see PVC. You see batteries and those types of things. You’ll see hoses – “Well, that’s rubber they can process hoses” – or plastic or low-density polyethylene bags that actually get in the screens and make it very, very difficult to extract, and it blinds our screens to extract the true commodities that are there.
John Shegerian: Wow.
James Devlin: So that is our single largest challenge today. And our municipal partners are concerned about it, we are concerned about it and we’ve got to work collaboratively to solve it. It’s education. It’s some of the things that we’re doing. We’ve got this co-project IQ, which are at four of our facilities we’ve dedicated personnel that do nothing but take digital pictures of the material coming in. We get truck numbers by day and our municipal partners work really well with us to clean up the stream. In fact, I’ll give you a plug for the City of Philadelphia.
John Shegerian: Sure.
James Devlin: They’re very progressive. There was always this history of their stream not being as clean as they’d like. They worked hand-in-hand with us and were able to identify the routes that generated the contamination and they moved very aggressively to clean up the stream because it’s in their best interests, it’s in ours, it’s in the consumers’ best interests ultimately if we can keep our costs down and again our overarching issue is the safety of our personnel.
John Shegerian: Sure. Safety first.
James Devlin: Absolutely. Absolutely.
John Shegerian: Got it. So we’ve been talking about contamination. Talk a little bit about separation. Why in America, James, from a social perspective and, of course, a business perspective that affects your business and industry so much, how come we’re not able to separate better and label better when we’re tossing stuff out so cans don’t have a dirty diaper in there.
James Devlin: Right.
John Shegerian: And people are taught how to clean out a pizza box before they send it in to you and things of that such.
James Devlin: Right. Obviously, there are evolutions in consumer preferences and you’ve got packaging as a tribute to that where you’ve got – historically – you might have a packaging product that was all polypropylene. Today it may be mixed with other – technically – commodities that are subject to being able to recycle but not cost-effectively, and there are not markets that exist for them today. So you see this confluence of what was formerly recyclable material being mixed with other materials that make it commercially unviable to remove the product. And it’s going to be constant education. I think so many times our municipal partners – and we all work together and it’s not a one and done and we have education rooms at every one of our facilities that if you grabbed somebody in the second or third grade and you develop those habits at that age.
John Shegerian: Right.
James Devlin: You’ll begin to see that over time and it pays dividends. But the thing that’s really more important than that – or just as important – is that in order for us to be environmentally sustainable, recycling has to be economically sustainable. I think the thing that we’re working with – our municipal partners – is processors like ReCommunity and others need to make a fair rate of return on the investments because these plants are $15 million and they’re 20-year contracts with our municipal partners, so they have to make a fair-rate return regardless if commodity pricing is at $150 a blended rate per ton or $2 rate per ton. We’re an environmental infrastructure for our cities and municipal partners, and we have to be in a position where we’re making a fair rate of return in order to continue to invest and recapitalize on some of the new technologies that are available out there to make our programs even better.
John Shegerian: And for our audience members that just joined us, we’ve got James Devlin. He is the CEO of ReCommunity Recycling. You can find his great company at www.recommunity.com. It is the leading recycling company in the United States right now. James, you gave a shout-out to Philadelphia a little while ago. Can you give a couple other great example of ReCommunity going to work with a city or municipality, and what a great public/private partnership with a city could really look like, and talk about some of your success stories you’ve had in ReCommunity, please?
James Devlin: Yeah. And I’ll be glad to do that. I think what we want to do is work collaboratively with our cities and identify where the problems are, pinpoint them and work together so I don’t want to necessarily single out other cities.
John Shegerian: Yeah.
James Devlin: We’ve got another large municipal partner – let’s just say – in the west that we’re working with.
John Shegerian: Yeah. Sure.
James Devlin: They’re very interested in cleaning up the stream. They’ve got 21 inspectors on the street.
John Shegerian: Wow.
James Devlin: So if we can develop the right process and work collaboratively with them to identify trucks by day, they can go out and affect really significant change. We’re finishing out an education room at this particular facility with this partner, so that’s an example where we’re working on multi-layers that are incredibly active in social media.
John Shegerian: Wow.
James Devlin: And you mentioned the Millennials and how interested they are in recycling, and they’re innovative in the way that they reach out to these partners. So, I mean, that’s an example. It’s multi-layered, it’s generators, it’s our municipal partners, meaning the cities and the various governmental agencies that we work with, and ultimately ReCommunity making sure that we get the right materials and we can access the right markets and have a sustainable outcome for everybody. Everybody should win in this situation, and I think the paradigm shift is that there is a social need for recycling, and it simply has to be economically sustainable for this to work in these low commodity markets that you mentioned now that exist today.
John Shegerian: Yeah.
James Devlin: But [inaudible] at some point, but you just need a capital structure and a relationship with our cities that enable these types of movements in commodity.
John Shegerian: You know, James, great CEOs like you don’t wake up thinking, “Oh. I have the leading brand; we’re No. 1.” You wake up thinking how to make the company better.
James Devlin: Absolutely.
John Shegerian: And also how to grow the company. What does the growth look like in the coming years ahead for ReCommunity? How big can this grow, and how many more communities and states and cities can you be serving?
James Devlin: It’s unlimited. If you look at the possibility for growth for our company – first of all, if you take a look at the number of programs out there that are still dual stream that could covert to single stream. That’s basically – for everyone’s edification – the dual stream would be separating at the curbside. Free buckets for fiber and cans and bottles, very difficult and clumsy for generators to use.
John Shegerian: Right.
James Devlin: To single stream where it’s one 65- or 95-gallon container. They put it all together. When we see programs that convert, we’ll usually see volume increases of 20-50 percent. So that is one opportunity to grow in terms of being unlimited. You’ve still got small markets that are underserved, and we’re looking at developing a solution for these smaller municipalities and cities that – say – are 100,000 and less that don’t have access and have to ship it to distant processing plants, which is not necessarily cost-effective. And they may have a high disposal rate, so diversion is very important to them, because they want to look at it economically as well as environmentally what can they get accomplished. Also, we’re looking at different ways to deal with one of the biggest challenges within our industry space and that’s dealing with glass. It’s a problem, but also we’re thinking hard about solutions and the best method by which we can process the glass, find markets. And we spent, probably in R&D and research, probably in the last two or three years, and we think we’re getting close to a solution that we’re really excited about that really takes a significant problem that exists today – because glass is roughly 20-25 percent of what is being collected and processed, however, a relatively small percentage of it is being returned to markets because it is so difficult to process. It’s so heavily contaminated with organics, other fiber material and those types of things. Also, it has got to be sorted by color. I can go through this whole thing.
John Shegerian: Right.
James Devlin: But again the way we look at it, it’s a solution. It’s a problem today, but we think we’re closing in on some solutions that could really be innovative and interesting for our municipal partners, and the key is can we set this up of which it is economically sustainable for investors to continue to capitalize in these types of profits.
John Shegerian: So you continue to do R&D and innovate at your company.
James Devlin: We must.
John Shegerian: Wow.
James Devlin: We must. Just from optical sortations to new optical sorters to try to get greater value extraction from the streams, we’re looking at screens that try to deal with this significant contamination that we see today that effectively somewhat clean themselves – so to speak – so we don’t have this constant winding of our screens, losing high value commodities because we’ve got bags and wire and hoses that wrap around these screens that prevent people from doing their job.
John Shegerian: How has the Chinese Green Fence affected your company, James?
James Devlin: I’ll say it’s an industry impact.
John Shegerian: Yes. Right.
James Devlin: I don’t think it’s specific to us.
John Shegerian: No.
James Devlin: Yeah. Because the good news is, I think, by any measure ReCommunity has the highest outbound quality.
John Shegerian: Commodities.
James Devlin: In respect to commodities, we’re considered to be some of the best processors out there, and we generate really wonderful commodities. So when we’re selling to China, in particular, right now they’re trying to enforce a specification of 2-3 percent contamination.
John Shegerian: Right.
James Devlin: So the impact on the industry is that there are greater processing costs to meet that specification. There is greater residue generation associated with it. Fortunately, we don’t see a lot of commodities being rejected in China, but if you take a load of fiber, send it to China and it is rejected there on the docks it’s an extremely expensive proposition to deal with. It is driving up costs for our peers within this industry too. So I think the whole key is what can be done to find markets that are here in the United States that can meet the quality specifications that can make a lot of these commodities commercially viable. But again those are some of the impacts of Green Fence. We understand why they are there. Certainly, we’re going to cooperate with the purchasers and buyers of our material. We have great relationships with them. But the long and short of it is it’s going to have a direct impact on commodity markets, and it’s going to ripple through. So if there is a cost borne by ReCommunity, ultimately it’s going to ripple back to the generators and our municipal partners as we enter into these types of projects.
John Shegerian: Makes sense. We’re down to the last minute or so, James. For our young entrepreneurs and ecopreneurs out there in the United States and around the world who want to grow up to be the next James Devlin to make the world a better place, what tips and advice can you give them on the path forward?
James Devlin: Yeah. If you can go out there and take problems today and find solutions for them, people want to recycle, people want to divert. I can’t think of ever taking a poll where somebody says, “I don’t want to be sustainable. I think the environment is not important and let’s keep doing what we’re doing.” Finding solutions to really difficult problems and working collaboratively to make sure that they’re as economically sustainable as they are environmentally sustainable.
John Shegerian: That’s wonderful. Thank you again, James. We’re going to have you back on another time to continue the journey and the story of ReCommunity. For our listeners and audience out there, please go check out James’s company. It’s www.recommunity.com. James Devlin, you are not only a recycling rockstar, but you are an inspiring innovator and you make the world a better place every day and thank you for being on Green Is Good.
James Devlin: Yeah, I’d love to take credit. It’s all the 1,500 employees that do all the work, and I try to go out there and steal credit when I can, but we’ve got a great team of dedicated professionals that do it every single day.
John Shegerian: Well, that’s what makes you a great CEO. Thank you so much.
John Shegerian: Welcome to another edition of Green Is Good. This is the Houlihan Lokey edition of Green Is Good, and we are so honored to have with us today Brian Leen. He is the president and CEO of ADA Carbon Solutions. Welcome to Green Is Good, Brian.
Brian Leen: Thank you.
John Shegerian: You know, Brian, before we get talking about your great company, ADA Carbon Solutions, can you share a little bit about your story. How did you even get to founding a carbon solution company?
Brian Leen: So my background is in the specialty chemical industry. For 20 years, I was with a company called Sun Chemical. It’s the largest graphic arts company in the world.
John Shegerian: Ah.
Brian Leen: So a big part of my heritage was in organic pigments. So a very different business. In 2010, the private equity company that owned that business came and recruited me, and I moved my family and we went out to Colorado and got started running the carbon business.
John Shegerian: And what does ADA Carbon Solutions do really? Can you share with our audience a little bit about the mission of your business?
Brian Leen: Sure. So our business is really founded on the premise of removing mercury from coal-fired power plant pollution. What we do is we manufacture activated carbon. Activated carbon – believe it or not – is a very, very common material that you would find in many places in your own homes. Water filters or other materials that you would commonly see in your home or that would be used in manufacturing products in your home. It’s a very common material. But the products that we manufacture we actually engineer very specialized carbons that extract mercury from the pollution or the emissions of coal-fired power plants.
John Shegerian: Wow.
Brian Leen: Yeah.
John Shegerian: How big is this problem in the United States, and how big is this problem around the world?
Brian Leen: Well, it has gotten a lot of attention really over the last 20 years. Mercury is a really well-known carcinogen.
John Shegerian: Yeah.
Brian Leen: Neurotoxin.
John Shegerian: Right.
Brian Leen: It creates and can result in birth defects and unborn fetuses, so it’s a nasty material. Research has been going on since the late ‘90s on how to extract it from coal-fired power plants. So it’s a target area for reducing mercury in our environment.
John Shegerian: And how does your carbon solution really work? How do you remove the mercury from the emissions?
Brian Leen: So when you think of activated carbon think of it as almost like a pumice material.
John Shegerian: Right.
Brian Leen: So this is a very small particle of carbon.
John Shegerian: Yes.
Brian Leen: That has an enormous amount of internal surface area. Pores actually. So it’s those pores that create the filterability capability of an activated carbon. So what we do is we manufacture very small powdered material – activated carbons – that are injected into the flue gas.
John Shegerian: Ah.
Brian Leen: During that period of time and that contact with mercury, it absorbs that mercury into those pores. It sequesters the mercury and is then safely disposed of.
John Shegerian: So interesting. And for our listeners and our audience out there that want to learn more about ADA Carbon Solutions, please go to www.ada-cs.com. When they brought you in to run the company, how big was the company then?
Brian Leen: Actually, it was a startup. This business was really built green-field starting in 2008.
John Shegerian: Ah.
Brian Leen: The factory really didn’t even start producing carbons until 2010, and today we believe that we’ve got over 40 percent of the overall capability or production that serves this particular market sector.
John Shegerian: They saw this need and they recruited you to run a startup, really. Who was then your competition in this since it was a start-up?
Brian Leen: Sure. So there are several different other carbon producers in the market today. The two larger ones were companies by the name of Calgon and another company by the name of Norit that recently was acquired by Cabot Corporations.
John Shegerian: But you have started this thing from scratch with your investors and you are now the No. 1 brand.
Brian Leen: Yeah.
John Shegerian: Wow. Are most of your clients here in the United States?
Brian Leen: Here in the United States and Canada. The customers that we serve are the coal-fired power plants, as well as waste-to-energy facilities. Most people may not realize this, but some of your kind of municipal trash, the trash that you throw out every day….
John Shegerian: Yeah.
Brian Leen: Is actually burned to make power.
John Shegerian: Right.
Brian Leen: And those plants require our technology as well.
John Shegerian: Really? That’s becoming a more – well, I don’t know if more popular – but a more publicized way of disposing of waste now. Here at the conference I saw the people from Covanta. Covanta runs plants like that so they need your technology.
Brian Leen: Exactly. Yeah.
John Shegerian: To absorb the mercury. Then once your carbon activated material absorbs the mercury, when you say that “gets disposed,” how does that get disposed then?
Brian Leen: So in a coal-fired power plant one of the pollution control devices is what they call a particulate matter collection place.
John Shegerian: Right.
Brian Leen: So that is a bag house or some sort of electro static participator. Our material comes out with the fly ash and is disposed of with the fly ash. Some people asked the question, “Is mercury ever re-leached into the environment?” Leaching studies have been done on carbon that has been put through this process, and no, it does not re-leach into the environment. That’s the reason – by the way – it was chosen, is the technology for using it.
John Shegerian: So basically, it becomes inert once it gets absorbed.
Brian Leen: Exactly.
John Shegerian: Wow. What other applications are there for your product?
Brian Leen: Well, again, mercury capture is important not only in coal but in waste facilities. Also, cement facilities, believe it or not. So people that make cement require our product to do the same thing – to remove mercury from their flue gas environment. Their mercury comes from the limestone not from coal. But activated carbon – again, as I mentioned – is a ubiquitous material. It’s used in water filtration. It’s used in de-colorization. So, for example, for people who see clear corn syrup and colored corn syrup. The big difference really is that the colored corn syrup has been put through a carbon filter. There are point-of-use water filters, air filters. It’s used in the manufacture of pharmaceuticals. So it’s a very prolific, very effective filter.
John Shegerian: I’ve heard that there is mercury – obviously – in light bulbs. So in the light bulb recycling, industry people have talked to me about carbon filters being used. Have you done any business in that area?
Brian Leen: No. Typically, those applications require different kind of sizes and shapes, and that’s not a market we’ve participated in.
John Shegerian: That’s a different market. So now that you have taken the dominant position here in the United States and in Canada – the 40 percent market share – you’re a young guy, where are you going to be driving now the growth of your company and further applications with regards to innovation and the R&D that you’re doing as well?
Brian Leen: So mercury regulation is not going to stop in the United States and Canada. There has already been an international treaty that is referred to as the Minamata Treaty that has many different participant countries who have committed to reducing fugitive mercury emissions. So there are already waste-to-energy facilities that exist in both Europe and China that use products that we make or products like what we make.
John Shegerian: Right.
Brian Leen: And we anticipate that there is going to be continued regulation for coal-fired power in other markets where coal-fired power is growing.
John Shegerian: OK.
Brian Leen: China, for example, is a market where coal-fired power is growing very, very quickly. We believe that there will come a time when they focus more on mercury emissions and where that opportunity for serving those power plants will develop.
John Shegerian: Go back to what you were saying, though. I’m fascinated by the terminology of “fugitive mercury.” So you’re saying it’s been outlawed here? In Canada and the United States?
Brian Leen: It’s been regulated.
John Shegerian: Regulated out. Sorry. Great point. Are the regulations on mercury as tough around the world or are they looser regulations on mercury?
Brian Leen: So the federal regulation that governs mercury control here in the United States is – to my knowledge – the tightest, most stringent regulation anywhere in the world.
John Shegerian: Wow.
Brian Leen: So really, in this case, the United States is leading the way. So our anticipation is that over time with the example that is set here in the United States other countries will follow.
John Shegerian: What are the other benefits of your business? How big has it gotten in terms of job creation and other environmental benefits and community benefits that a great company like yours brings?
Brian Leen: Well, I think one of the things that we’re most proud of – frankly – are the jobs that we’ve created as a result of the growth of our company. We’ve brought about 80 high-paying, high-quality jobs to a very poor parish in Louisiana called Red River Parish. It’s where our facility is based. We’ve actually had Governor Bobby Jindal come to our plant twice to celebrate kind of the job creation in that part of the community. We also have a headquarter location in Littleton, Colorado where we have developed all of our R&D and our back office support. So there are about 30 people that are employed there. So we are really proud of kind of the growth that we’ve seen. I’ll tell you that it’s a fun place to come to work. It’s easy to get excited about the fact that every day that you come to work you’re making the environment a cleaner and safer and healthier place.
John Shegerian: For our audience members that just joined us, we have Brian Leen with us. He is the President and CEO of ADA Carbon Solutions. To learn more about ADA Carbon Solutions, go to www.ada-cs.com. Brian, you’re here today – and this is the Houlihan Lokey special edition of Green Is Good, and we’re here in New York City at the Marriott Marquis. Why are you excited to come here to be an evangelist for your company and for your technology? How do you get so much done today, and why is it important to come to a conference like that so you can further spread the good word of what you’re doing?
Brian Leen: Houlihan Lokey has a great – I think – global reach to a variety of different – both strategic companies as well as financial – companies that represent potential investors into our business. Environmental regulation is going to continue to impact coal-fired power. We see tremendous opportunity for ongoing investment and growth bringing new technologies to bear to allow and help coal-fired power continue to be an important part of our energy platform. So what’s so great about this opportunity is getting to meet other potential investors in our business who share the kind of vision for growth, that share the vision for what we think our company can be.
John Shegerian: Got you. And so you are presenting here today?
Brian Leen: I am.
John Shegerian: Got you. And so how much of your life do you spend on the road being an ambassador and evangelist for all the great work you’re accomplishing at ADA?
Brian Leen: Well, quite a bit.
John Shegerian: Yeah.
Brian Leen: Mostly with prospective customers because we are looking at trying to help understand their problems and design solutions that will meet those challenges. But I spend quite a bit of time out there with those people.
John Shegerian: That’s awesome. Well, that’s great and we thank you for your time today. And, again, for our listeners out there and our viewers, it’s ADA Carbon Solutions. To learn more about ADA or to contact Brian, go to www.ada-cs.com. You know, Brian, you’re an inspiring entrepreneur and you make the world a better place every day, and for that, you are truly living proof that Green Is Good. Thank you for joining us today.
Brian Leen: Thank you.
John Shegerian: Thank you very much. We really appreciate it.
Brian Leen: Take care.
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