Eugene Water and Electric Board, Eugene, Oregon, USA

Eugene Water and Electric Board (EWEB)
A Natural Step Network Case Study

Overview
The Eugene Water and Electric Board, the largest public utility in Oregon, serves over 75,000 business and residential customers for electricity and over 40,000 for water in Eugene and parts of the surrounding southern Willamette Valley. It also provides steam for the heating and hot water needs of approximately 100 commercial customers in downtown Eugene. Electrical generation facilities, providing about 20 percent of its supply, include small-to-medium-scale hydroelectric plants, industrial cogeneration facilities, and part of a wind generation facility in Wyoming. The rest of its energy supply is purchased under contract from the Bonneville Power Administration and from the wholesale energy market. EWEB also owns an electrical distribution system, a steam generation plant, and water treatment, storage, and distribution facilities. Operating its facilities valued at nearly $450,000,000 is a major activity. In 2000 EWEB had revenues of over $140 million and employed about 470 people.

Background
An outbreak of typhoid in 1906 traced to the water supply led to a loss of community confidence in the private water company. The City of Eugene responded by purchasing the water treatment plant after a bond authorization was approved by public vote. In 1911 the new municipal utility built a small-scale hydroelectric plant to reliably power the water system. The excess electricity was sold to the community, giving the utility a start in the electric-supply business. In 1916, the local private power company was purchased, and the utility became a full-service supplier of both water and electricity. At this point the name was changed to Eugene Water & Electric Board.

EWEB has a long tradition of promoting and rewarding sustainable activity in all aspects of its operation. In the 1970s, this was heightened as the controversy over nuclear power came into focus in Oregon. EWEB was a 30-percent owner in the Trojan Nuclear Plant, but public sentiment led to a decision to withdraw its support of nuclear power in general and its ownership of the Trojan facility in particular. An increased emphasis on renewable sources, conservation, and environmentally sensitive operations was established. In 1990 EWEB was cited for non-compliant air emissions from the steam generation plant. The organization was motivated to avoid that kind of problem in the future. It created an environmental manager position and shifted from compliance to prevention, self-regulation, and avoidance of regulatory costs. Eventually, the Environmental Department grew to five staff members.

Programs encouraging and rewarding conservation were put into place and have continued since. EWEB views conservation of energy as a viable and cost-effective alternative to electricity generation. In 2000, for instance, it is estimated that conservation and efficiency improvements provided the equivalent of about 10 percent of Eugene’s power needs, resulting in a savings of over $9 million in wholesale power costs.

In 1996 the board developed a set of operating principles with sustainability as one of three overarching principles to guide operations (the other two being community leadership and business success). These principles led to the development of an environmental policy that was adopted by the Board of Commissioners in November of 1997. The effort to develop this policy involved people throughout the organization, not just executives.

Also during this time, EWEB was searching for management tools to help the organization on its path toward sustainability. It explored and evaluated several systems to help with decisionmaking, such as ISO 14001, and studied other concepts such as the CERES Principles. It selected items or approaches from all to develop an eclectic approach that best fits its organization and situation.

The Introduction of The Natural Step
Historically then, EWEB’s mission, culture, and internal policies were all aligned to reinforce and enhance EWEB’s efforts at doing business in a sustainable fashion. The environmental policy provided direction for the organization’s activities in accomplishing its mission. What still was needed was a framework that would tie all the different efforts together and provide a language and model for everyone in the organization.

In 1997 the first TNS training was held in Portland, and a few EWEB employees attended. The next year, training was offered in Eugene, and more employees got exposure to TNS. In 1999 when the national conference for TNS was held in Portland, EWEB attendees could see the extent to which many organizations around the world had adopted the framework. As Environmental Manager Laurie Power states, TNS clearly “seemed to hold promise, and we were inspired by the support for it. It seemed to provide the missing element in EWEB’s approach – a framework to bridge the gap between vision and application of the sustainability mission.”

Power’s environmental group determined that the system conditions could be used by anyone in the organization as an aid to making decisions. They provided a scientifically based foundation that all could understand. A Sustainability Working Group of senior staff and mid-level managers was formed with the support of Power’s executive manager. This manager willingly took the message to the Executive Management Team. At the time, the Team was building six strategic goals for the utility as a whole, one of which was sustainability. The Executive Team agreed that The Natural Step’s system conditions had a role in EWEB’s strategy for sustainability. The Team also endorsed a questionnaire developed by the Working Group that
incorporated the system conditions and other questions to foster sustainability in decisionmaking. (See Exhibit 1). The questionnaire was to be used by work groups and managers to evaluate alternatives when making decisions about projects.

Training Power’s team developed a half-day training program to bring employees up to a common level of understanding about sustainability and how it could be considered in each job function. Work groups of up to ten people in areas such as landscape, shop, water, construction, and electrical distribution have received the training, which includes the environmental policy, TNS framework, and the questionnaire. One of Power’s staff was made responsible for the training, and attended several “train the trainer” sessions conducted by the Oregon Natural Step Network. At the end of 2001, approximately 150 employees had been trained.

After the training, a project group was planning a new transmission line to outlying areas west of Eugene and observed that the route extended through wetlands. The group discussed routing and materials in the light of the system conditions and made recommendations that were far different from traditional approaches. The routing was planned to minimize impact on the wetlands, and the recommended material for the transmission towers was recycled steel instead of the customary treated wood. Steel has a longer life and does not have to be handled as “special waste” at the end of its life like treated wood does. It addition, the costs over the long term would be lower.

Benefits and Results
Each year the Executive Management Team selects strategies to carry out the utilities’ six goals.
Following are some of the results:

• Paper usage. EWEB set a goal of 10% reduction of paper by year-end 2000. This program achieved a 28% reduction in the first four months -- nearly triple the original goal. Further, the employee group that had been given the charter for this project found an office paper manufactured by Georgia Pacific that had 30% post-consumer fiber and did not compromise appearance or printing performance. By utilizing a state purchasing agreement, EWEB paid no more for this paper than that which it replaced.

• Energy conservation at EWEB headquarters. With its strong history of support for conservation, EWEB looked for further reduction of energy at its headquarters site. In the 90-day period May through July 2001, consumption was reduced by nearly 19% over the same period in the previous year.

• Conservation and renewable energy for EWEB customers. EWEB implemented a threetiered rate structure for electricity in November 2001. Rates are higher for customers with higher usage, providing an economic incentive for greater conservation. Additionally, residential and commercial customers are given the option of buying wind power for the equivalent of 10%, 25%, 50%, or 100% of their usage. Customers are charged a higher rate for wind power, reflecting the higher costs. This program provides a way for customers to support EWEB’s shift to renewable energy.

• Future electricity generation. EWEB has developed strong policies to guide investments in future power generation capacity. These are (1) to continue with its efforts to reduce demand through education, incentives, and other programs, (2) to provide superior environmental performance for non-renewable generation during the transition to a sustainable energy future, and (3) to seek out and invest in renewable sources in a way consistent with other business goals. EWEB will exceed Oregon law in mitigating emissions from natural gas plants, it will make further investments in wind and hydro capacity, and it is beginning pilot applications of solar photovoltaics, fuel cells, and other technologies.

• Vehicles. EWEB set a goal to convert its fleet of sedans to fuel-efficient hybrid vehicles. One sedan will be bought in 2002, and 12 will be in place by 2006.

Sources:

1. Discussions with Laurie Power, Environmental Manager; Deb Brewer, Public Affairs Manager; Jim Maloney, Energy Resources Project Manager; and Mark Wall, Environmental Specialist in May and August 2001.
2. EWEB Web site: WWW.EWEB.ORG.

Exhibit 1

EWEB QUESTIONNAIRE

Building Sustainability into EWEB’s Business Decisions (2/26/01)
Introduction: This list of questions is designed to help you make decisions that foster sustainability*. The intent is to prompt thorough and lively discussion among decisionmakers
and work groups, prompting deeper understanding of the issues that underlie sustainability. This process is, by its very nature, holistic, creative, and perhaps a bit
messy as you explore ways to ground sustainability into your work.
Name of Project:
Participants:
1. What is the objective or need?
2. What are the options to address the objective/need?
3. What are the impacts on the community?
4. What are the economic impacts?
5. What are the impacts on the environment?
6. Is it consistent with our Board principles?
7. Who needs to be involved in this decision?
8. What are the impacts on EWEB?
9. How are we generating waste? What could we do to reduce waste and encourage recycling or reuse?
10. Is there another way to meet the business objective or need? (Replay of question #2)
11. Test solutions on the 4 system conditions of The Natural Step:
 

a. Does this activity foster or support a systematic reduction over time in the extraction of materials from the earth’s crust?
b. Does this activity foster or support a systematic reduction over time in the accumulation of synthetic chemicals/substances into the biosphere?
c. Does this activity foster or support the health of nature’s life-sustaining ecosystems and ecosystem services?
d. Does this activity foster or support the fair and efficient use of resources to meet present and future human needs?
 

12. How can progress be monitored?
13. Does this foster sustainability? Does it move us in the direction of sustainability?
14. If not, what should we do?
Other Comments: __________________________________________________________