Congress Extends Tax Credits for Solar & Wind

The week before Christmas Congress passed a pair of budget bills that contained multi-year extensions of tax credits to encourage solar and wind energy development. The extensions were part of a package deal that included extensions for other renewable energy sources such as geothermal, landfill gas, and hydro in exchange for lifting the 1970s ban on the export of crude oil.

The solar energy Investment Tax Credit (ITC) was set to decline from 30% to 10% at the end of 2016. The legislation extends the tax credit at the 30% level through the end of 2019, after which it will decline annually until it hits 10% in 2022. The extension will help the solar industry avoid the boom and bust cycles that have plagued the wind industry due to chronic uncertainty around the production tax credit.

The wind Production Tax Credit (PTC) was extended at the $0.023/kWh level through 2016. The PTC will then decline 20% per year from 2017 through 2020.

The extension of the ITC will help solar to continue its rapid growth trajectory. GTM research attributes a 30% increase in solar investment through 2020, more than $40 billion, to the extension of the ITC. Overall, GTM is predicting that nearly 100 gigawatts of installations, representing $130 billion in investments by 2020. Though a net positive, Bloomberg New Energy Finance (BNEF) is predicting that the extension of the ITC will reduce the amount of solar installed in 2016 as developers no longer have to rush to meet the ITC expiration deadline at the end of 2016. Overall, BNEF predicts the total solar installations in 2016 will be down about 2.8 gigawatts, but the 2017 increase will more than make up for this reduction.

Energy Management Increasingly Seen as a Source of Competitive Advantage

Deloitte’s 2015 Resource Study found that business increasingly views an active energy management program as a way to create and maintain competitive advantage. The study, first conducted in 2011 and update annually thereafter, is based on a survey of over 600 corporate energy management decision-makers. Fully 44% (up 10% from 2014) of respondents identified energy management as integrated into corporate strategy, while 37% said energy management is integrated at the business unit or site level. Reducing electricity costs was identified as a key goal:

  • 79% identified reducing electric costs as important to financial competitiveness
  • 77% identified reducing electric costs as important to image/brand competitiveness

The latter suggests that companies are motivated by more than just cost-cutting; they are also taking into account external stakeholder views.

Businesses are spending capital to achieve their energy management goals. Goals have been set around electricity (88%), natural gas (64%), transportation fuels (59%), carbon (57%), and water (70%), with approximately one-quarter of goals across all five areas being targeted reduction goals.  Ninety-three percent of businesses indicate they invested capital over the last five years to achieve energy goals, totaling around 17% of overall capital spending.

The most popular technologies and strategies for achieving energy management goals in 2015 were:

  • 55% timers/sensors to control when equipment is powered on
  • 53% motion sensors
  • 47% building energy management systems
  • 41% demand response programs
  • 39% onsite generation technology such as solar panels
  • 34% energy recovery systems
  • 26% batteries for load shifting and peak shaving

New technologies will continue to drive increased corporate energy efficiency. A 2015 study by McKinsey & Company finds that operational improvements can improve energy efficiency 10-20%, but investment in new technologies can increase the savings to as high as 50%. Overall, the study finds that adoption of innovative technologies could save industry over $600 billion per year globally. The report outlines new technologies for the following nine sectors.

  • Advanced Industries (e.g. semiconductors, electronics)
  • Cement
  • Chemical
  • Oil Refining
  • Consumer Goods
  • Mining
  • Power
  • Pulp and Paper
  • Steel

The full report can be found here — Greening the future: New technologies that could transform how industry uses energy.

REAP: Rural Renewable Energy & Efficiency

The Rural Energy for America Program (REAP) was created by Congress in the 2008 Farm Bill. Administered by the U.S. Department of Agriculture (USDA) the REAP program provides grants and guaranteed loans to agricultural producers and rural small businesses for renewable energy projects or energy efficiency improvements. In August, the USDA announced $63 million in loans and grants for 264 renewable energy and energy efficiency projects so far in 2015. Several of U.S. Energy’s ethanol clients have made applications to the REAP program to support their energy efficiency improvement efforts.

Applicant Eligibility

Agricultural producers may be in rural or non-rural areas as long as they derive at least 50% of gross income from agricultural operations

Small businesses must be in an area other than a city or town with a population of 50,000 or more. Small businesses can check if they are in an eligible rural area here.

Project Eligibility

Renewable Energy Systems – funds may be used for purchase, installation, and construction of systems. Examples of eligible renewable energy systems include:

  • Biomass
  • Geothermal
  • Hydropower
  • Wind
  • Solar

Energy Efficiency Improvements – funds may be used for purchase, installation, and construction of improvements. Examples of eligible efficiency improvements include:

  • Lighting
  • Insulation, doors & windows
  • High efficiency HVAC
  • High efficiency motors and pumps

Funding Types

Grants and loan guarantees are available through the REAP program and individual projects may apply for one or both. Combined grant and loan guarantee funding cannot be more than 75% of the total project cost.

Grants

  • Grants up to 25% of total project cost
  • Renewable energy system grants range between $2,500 – $500,000
  • Energy efficiency grants range between $1,500 – $250,000

Loan Guarantees

  • Loan guarantees up to 75% of total project cost
  • Minimum loan amount of $5,000
  • Maximum loan amount of $25 million

Energy Audits and Assessments

When applying for energy efficiency improvement (EEI) funding an energy audit or assessment is also required as part of the application package. For EEI projects with a total cost greater than $200,000 an Energy Audit must be conducted. For EEI projects with a total cost of less than $200,000 an Energy Assessment or Energy Audit may be done. In general, the Energy Audit requires more in-depth analysis of the proposed EEI, such as detailed specifications, measurement plan, and calculation of direct and indirect costs.

REAP Resource Links

EPA Releases Final Clean Power Plan

On August 3, President Obama announced the U.S. Environmental Protection Agency’s (EPA) final Clean Power Plan (CPP).  First proposed in June, 2014 the goal of the CPP is to reduce carbon dioxide (CO2) emissions from existing power plants 32% from 2005 levels by 2030.  This is an increase from the originally proposed goal of a 30% reduction; and not the only change from proposed rule.  Before reviewing other key changes between the proposed and final rule let’s recap what sources are covered by the CPP.

CPP - PowerSectorCO2Emissions

Source: U.S. EPA

The CPP covers larger electric generating units (EGUs) that sell power to a utility distribution system.  Covered EGUs include any boiler, integrated gasification combined cycle, or combustion turbines (simple or combined cycle) that:

  1. is capable of combusting 250 million BTUs per hour or more
  2. combusts fossil fuel for 10% or more of its total annual heat input
  3. sells the greater of 219,000 MWh per year and one third of its potential electrical output
  4. was in operation or had commenced construction as of January 8, 2014

Given the electrical production numbers above, and assuming a capacity factor of 100%, the smallest possible generating unit that would be covered is 25 MW.  More realistically, covered EGUs will be at least twice this size.

Key Changes in the Final CPP

Mass-Based State Goals: One of the key changes from the proposed to the final rule is the addition of mass-based goal in addition to rate-based goals for each state.  The proposed rule only included rate-based goals. Mass-based goals were added to expand options for states when developing their plans, in particular it facilitates states’ use of mass-based trading programs.

Trading-Ready Mechanisms:  states have the option of developing trading-ready programs, which means EGUs can trade creditable reductions between states without the need for an interstate agreement to be in place beforehand.  EPA is committed to facilitate trading by helping states track emissions and credits.

Compliance Glide Path: one of the biggest criticisms of the proposed rule was the compliance cliff in 2029.  The final rule phases in EGU performance rates over three time periods: 2022-2024, 2025-2027, and 2028-2029; with final compliance in 2030.

BSER made up of Supply Side Building Blocks: EPA sets the level of reductions for EGUs by looking at the Best System of Emission Reductions (BSER) demonstrated for a pollutant.  In the proposed rule the BSER was made of four building blocks, including energy efficiency, a demand-side block.  The final rule only includes the supply-side building blocks shown below:

  • Improved Efficiency at Power Plants
  • Shift Generation from Higher Emitting Coal to Lower Emitting Natural Gas
  • Shift Generation to Zero-Emitting Renewables

Revised Building Block Assumptions: in addition to removing the demand-side building block EPA also revised the assumptions for the remaining supply-side building blocks based on feedback received on the proposed rule.

Building Block Proposed Rule Final Rule
Improved Efficiency at Power Plants Assumes a 6% improvement is possible for coal units 2.1% – 4.3% depending on region of the U.S.
Shift Generation from Higher Emitting Coal to Lower Emitting Natural Gas Increase the capacity factor to 70% for natural gas combined cycle EGUs 75% of net summer capacity
Shift Generation to Zero-Emitting Renewables increase use of renewable resources Assumes more renewables due to falling costs – excludes existing nuclear and renewables

For a complete overview of all the key changes see the EPA fact sheet Clean Power Plan: Key Changes and Improvements; a full list of EPA fact sheets on the CPP is at the bottom of the article.

Implementation and Compliance Timeline

In addition to increasing state flexibility and encouraging trading as a compliance tool the EPA also pushed back the first compliance milestone from 2020 to 2022.  The timeline for submitting plans has been pushed back two months, with at least an initial plan due by September 6, 2016.

CPP - Timeline2

Source: U.S. EPA

The extended timeline may give states greater flexibility in that it will give more time for economic fuel switching from coal to natural gas to continue to play out in the electric generation sector.  Just last week the Energy Information Administration (EIA) announced that power sector CO2 emissions hit a 27 year low in April.  The EIA notes that April is typically the month with the lowest CO2 emissions, and that April 2015 was the lowest of any month since April, 1988.  Comparing these two months 27 years apart the EIA notes that:

  • Natural gas consumption in the sector has tripled
  • Renewable energy consumption doubled
  • Nuclear energy consumption increased 47%
  • Coal consumption decreased 17%

All of these trends have naturally led to a less carbon intense power sector with generation up 44% over the period, but energy use increasing only 33% and CO2 emissions up just 4%.  The graph below shows that the monthly power sector carbon emissions have been trending down since 2005. The full EIA piece is here: Monthly power sector carbon dioxide emissions reach 27-year low in April.

 

 

EPA Clean Power Plan Fact Sheets:

Bladeless Wind Power

Vortex Bladeless Field

Image courtesy of Vortex Bladeless

Renewable energy sources make up 13% of the U.S. electric generation portfolio; the U.S. Energy Information Administration (EIA) projects that U.S. renewable electricity generation will grow to 18% by 2040; with wind overtaking hydro as the largest renewable source by then.   Though solar has been growing faster year-over-year, the EIA Short-Term Energy Outlook projects that wind will add more absolute capacity between 2014 and 2016; 18 GW for wind compared with 9 GW of utility-scale solar.

The report Enabling Wind Power Nationwide was released by the Department of Energy in May and focuses on new technologies to expand wind energy in the U.S.  The primary focus is on taller turbines and larger rotors to capture the more consistent and stronger winds at greater heights.  Though there are technical and logistical challenges when raising hub heights from the standard 80 meters (262 feet) to 110 meters (360 feet) or more; this is an extension of existing technology rather than a fundamental technological innovation with how wind energy is collected and converted to electricity.

For this latest Future Friday post we’re going to look at a startup company that is trying to create a fundamental shift in how wind energy is generated.  Vortex Bladeless is rethinking wind energy by doing away with the turbine altogether and harnessing the cyclical pattern of vortices that are formed by wind flowing around a tower.  Vortex says their bladeless system can generate electricity for 40% less than standard turbine technology.  According to the EIA land-based wind turbines already have one of the lowest Levelized Costs of Energy (LCOE), conventional or renewable, except for advanced combined cycle natural gas generation and geothermal (EIA 2015 Annual Energy Outlook).  A further 40% reduction in LCOE would make the Vortex Bladeless technology the lowest cost electric generation technology overall.

Vortex Bladeless Single

Image courtesy of Vortex Bladeless

The Vortex system achieves the cost efficiencies with an innovative, but simple design for harnessing wind energy.  The main mast oscillates in the wind due to the vorticity effect; this oscillation force is transmitted through an elastic rod to drive a generator at the base of the system.  According to Vortex Bladeless this design achieves cost efficiencies in a number of ways:

  •  53% lower manufacturing costs – the blades and nacelle of a traditional wind turbine are eliminated.  Further savings are achieved because the generator is at the base, obviating the need for an expensive mast that can hold the generator 300 – 400 feet in the air safely under high wind loads.
  •  80% lower maintenance costs – the mast and elastic rod are magnetically coupled to the generation system, so there are no mechanical elements that can wear out, require lubrication, etc.
  •  Lower installation costs – the Vortex system is estimated to weigh 80% less than a conventional wind turbine, resulting in easier transportation and installation of the system.  This also results in a foundation that is 50% smaller than a conventional turbine, which generates additional savings.

Traditional wind turbines have one advantage over the Vortex system, they are more efficient.  The Vortex system is estimated to be 30% less efficient that a traditional turbine, but lower costs and the ability to put them closer together than traditional turbines compensates for this disadvantage.

Vortex began field testing a 6 meter scale prototype in 2014 and completed a successful round of crowd funding in June.  The plans are to build a 13 meter system with an output of 4 kW in the next 12 months, and an industrial prototype that is 150 meters with a 1 MW output in the next 36 months.

MN Solar Gardens & Green Power Claims

Florida Power & Light Company's DeSoto Next Generation Solar Energy Center, a 25-MW ground-mount solar power system in DeSoto County, Florida

The Minnesota Solar Garden program has turned out to be much larger and more popular than expected.  Originally expected to be about 100 MW in size, the program received 400+ MW of applications within the first week.  Unlike experience in other states where residents and smaller entities such as schools made up the bulk of subscribers the Minnesota program is seeing large commercial and industrial subscribers as well.  Most notably, Ecolab signed a subscription with SunEdison for 16 MW of solar garden output (see here), and the St. Paul Public Housing Agency signed a subscription to cover 85% of the electricity use at 16 residential high rise buildings (see here).

The Minnesota Legislature established the Community Solar Garden Program in 2013, and Xcel Energy launched the Solar*Rewards Community program in December of 2014.  The program was designed for Xcel customers who can’t install onsite solar because they rent, live in a multifamily building, or otherwise don’t have a site or roof that is suitable for solar.  The program enables residents and businesses to participate in an offsite solar project by subscribing to a solar garden; for each kilowatt-hour (kWh) produced by their share of the garden subscribers receive a credit on their Xcel bill. The MN Clean Energy Resource Teams (CERTS) have put together a good primer on the program, including a list of Frequently Asked Questions, which can be found here.

One aspect of the program that is not well understood is whether subscribers are able to make the claim that they are using renewable (aka “green”) energy.  Most who participate in the program assume that their subscription to a solar garden, a green energy source, enables them to claim that they are now using green energy, but this is not the case.  In order to understand why, we first need to understand what Renewable Energy Certificates (RECs) are, and how they are used to encourage the development and use of renewable energy sources.

The Environmental Protection Agency’s Green Power Partnership  defines a REC as the environmental, social and other non-power attributes of one megawatt hour (MWh) of renewable electricity generation.  RECs can be generated from renewable sources such as solar, wind, or hydro power; and are often sold separately from the physical electricity.  The owner of the REC has the right to claim the use and benefits of renewable generation.

The benefit of being able to sell RECs separately is that they can then be used as a policy tool to incentivize the development of solar projects.  For example, states such as New Jersey, Massachusetts, and Pennsylvania have Renewable Portfolio Standards (RPS) that requires utilities to get a certain percentage of their generation from solar.  Utilities comply with this mandate by purchasing and retiring RECs from third-party solar developers.  Revenue from the sale of RECs creates an incentive for developers to spend capital developing solar projects.  In compliance markets where there is an RPS requirement RECs can sell for hundreds of dollars.  In voluntary markets, where purchase is not mandated, they sell in the range of one to tens of dollars.

Subscribers to solar gardens are not able to claim they are using renewable or green power because they are selling their RECs to Xcel.  The value of the credit that solar garden subscribers see on their Xcel Energy bill is made up of two components: 1) compensations for the electricity generated, and 2) compensation for sale of the RECs generated.  The diagram below shows the breakdown of payments in more detail.

Solar Garden Payments

Solar garden subscribers are compensated for the power their share of the solar garden puts onto the electrical grid, and for the RECs delivered to Xcel Energy.  The price Xcel pays for the power is the Applicable Retail Rate (ARR), which is set once a year for each rate class.  Xcel pays $.02/kWh for RECs from solar gardens larger than 250 kW, which are the most common, and $.03/kWh for RECs from solar gardens smaller than 250kW.  Unlike the ARR, the REC payments are fixed for the 25 year term of a solar garden subscription.  For General Service customers (i.e., larger commercial and industrial customers) the 2015 ARR is $.09914/kWh, adding in the $.02/kWh REC payment you get a total bill credit of $.11914/kWh.  Thus, the REC payment is a significant portion of overall compensation.

What can subscribers do if they want to claim they are using renewable energy?  The easiest solution is to buy and retire RECs in sufficient number to cover the percentage of electricity they want to claim is renewable.  One may ask why they just don’t just keep the RECs generated from their share of the solar garden.  Xcel is paying $.02/kWh for the RECs, which is equivalent to $20 per MWh (RECs are the non-power attributes of 1 MWh).  On the voluntary market RECs can often be purchased for around a dollar.   So, it makes financial sense to sell the solar garden RECs for $20 and purchase RECs for about 5% of that price on the voluntary market.

UPDATE — California Cap & Trade Program Set to Expand in 2015

California_state_flag

 

On Friday, December 19, 2014 a California Administrative Law Judge (ALJ) issued a decision regarding natural gas utilities inclusion in the California Cap and Trade program that effectively postpones the start of implementation until later in 2015.  Decision 14-12-040 was issued in response to the proposed settlement developed by California natural gas utilities and covered resolution of Phase 1 issues – priority issues that needed to be resolved to ensure implementation by January 1, 2015.  Key findings from the decision are listed below.

  • The utilities proposed 2015 forecast of cap-and-trade compliance costs lack sufficient detail regarding assumptions and methodologies to be approved.  The ALJ required natural gas utilities, within 30 days of the decision (by January 19, 2015), to file information with sufficient detail that 2015 forecast costs can be authorized.  Natural gas utilities are not allowed to include cap and trade costs in natural gas rates until a 2015 forecast has been approved.
  • The proposed settlement inappropriately limits the ability to set a higher allowance consignment percentage.  Utilities are given some allowances to help defray compliance costs and limit price impacts.  A percentage of these allowances must be sold to benefit the ratepayers.  Utilities proposed that only the minimum number of allowances need be sold (25% in 2015, increasing 5% per year afterwards).  The ALJ rejected this proposal and deferred the decision to Phase 2.  No date has been set for the beginning of Phase 2.

This decision only delays the implementation of the expansion of the Cap and Trade program for California natural gas utilities; it does not cancel the expansion.  In Ruling 14-03-003 filed yesterday, the deadline for making final decisions was set for some time in June, 2015.

For a more in depth description of the proposed changes and their potential impacts the original post is available after the link. (more…)

New Tool Monetizes Growing Business Water Risk

In November CDP (formerly the Carbon Disclosure Project) released its 5th annual Global Water Report: From Water Risk to Value Creation.  The report analyzes responses from 174 (35%) of the largest 500 global companies (Global 500) to the CDP water survey.  One of the key findings: 68% of respondents are exposed to water risk that has the potential to “generate a substantive change in their business, operations or revenue.”  The sectors reporting the greatest exposure to water related risks are shown below:

Water Risk Sectors

Twenty-two percent of respondents report that water insecurity could constrain growth, and fully one third of those indicate that constraints could be reached in the next 12 months.  The top five risks drivers identified by respondents are

Water Risk Drivers

Digging deeper into the Consumer Staples Sector (food and beverage, personal and household products) illustrates that water risk is a problem companies are already dealing with.  Exposure to water risk in direct operations was reported by 77% of respondents; 77% also reported supply chain risk, the highest for all reporting sectors.  Water risk is not hypothetical, 45% of respondents reported detrimental impacts of water challenges in 2014.  The sector is responding to these challenges with over 80% setting goals to reduce water use or intensity and 52% requiring suppliers to report on water use.  Driving these actions are the opportunities to: improve water efficiency, reduce cost, and increase brand value (as reported by 45% of respondents).

Overall, the move to action is not as clear.  Though a majority of respondents report exposure to substantive water risk only 38% report that they are assessing that risk in their direct operations and supply chains.  Respondents reported to CDP that awareness of the problem is increasing and consensus is building around how to monitor and manage the issue.

Water Risk Monetizer

The Water Risk Monetizer, a new tool released by Ecolab, Inc. and Trucost may help build support for taking action to address water risk.  The Water Risk Monetizer is a freely available, online tool that enables not only the identification of water risks, but the cost implications of those risks.  As a financial modelling tool it adds another dimension of information to the water risk discussion that will enable these risks to be more concretely included in corporate-level strategic planning and risk mitigation activities.  Users enter facility-level information into the tool such as location, annual water use, production, etc. and the tool provides information on the financial water risk premium (in dollars) in one, three, five and ten year time frames.  Qualitative risk scores (e.g. High, Moderate) are provided for water scarcity, reputational risk and regulatory risk.  The Water Risk Monetizer has global coverage so it can be used to assess risk for direct operations and in the supply chain.

 

EU Increases Climate Commitment

Global_European_Union.svg

By S. Solberg J. ([1]) [CC-BY-3.0 (http://creativecommons.org/licenses/by/3.0)], via Wikimedia Commons

At the end of October European Union Leaders agreed to a 2030 Framework for Climate and Energy PoliciesThe EU committed to reducing greenhouse gas (GHG) emissions by at least 40% below the 1990 level by 2030.  This new goal doubles the previous commitment of a 20% reduction by 2020; and keeps the EU on pace to meet their 2050 goal of at least an 80% reduction in GHG emissions.  In comparison, President Obama’s 2013 Climate Change Action Plan has set a goal of reducing greenhouse gas emissions 17% below the 2005 level by 2020.

The new EU GHG reduction goal will be met, in part, by lowering the cap in the EU Emissions Trading System (ETS).  EU ETS is a cap and trade system that operates across the 28 member states and covers about 45% of EU emissions from power generation and manufacturing.  The remainder of the reduction will come from sectors that fall outside of the EU ETS; targets will be set for individual member states, which have flexibility in how reductions are achieved.

The UK Energy Savings Opportunity Scheme (ESOS) is one example of an EU member country strategy to reduce GHG emissions outside of the EU ETS.  ESOS is a mandatory energy assessment scheme implemented by the UK Environment Agency that requires organizations meeting the definition of a large undertaking to complete an ESOS assessment at least once every 4 years.  The ESOS assessment must cover building, process, and transportation energy use; and should identify practical and cost effective energy saving opportunities.  The difficulty for many organizations will be collecting the required 12 months of continuous data that accounts for at least 90% of energy use.  The deadline for UK companies to conduct the first ESOS assessment is December 5, 2015; so, companies still have time to begin collecting data.

In related news the IPCC’s 5th Assessment Synthesis Report was released just four days ago on November 1 and provides support for the EU’s GHG emission reduction activities.  The report restates that human influence on a warming climate system is unequivocal, and

Continued emission of greenhouse gases will cause further warming
and long-lasting changes in all components of the climate system,
increasing the likelihood of severe, pervasive and irreversible impacts
for people and ecosystems. Limiting climate change would require
substantial and sustained reductions in greenhouse gas emissions which,
together with adaptation, can limit climate change risks.

The report will inform the next round of UN climate talks in Paris in 2015 where 200 governments will again try to reach consensus on an international agreement to combat climate change.

Sustainability Strategy Increasingly Important to the C Suite

Sustainability is seen as increasingly important to overall corporate strategy by company leaders according to a 2014 global survey done by McKinsey & Company: Sustainability’s Strategic Worth.  McKinsey & Co surveyed over 3,300 executives worldwide covering the full spectrum of industries, company sizes, and executive levels.  The survey revealed that 43% of executives say their companies’ primary motivation for pursuing sustainability is alignment with company goals, mission or values.  This is a significant change from the last survey in 2012 where cost cutting was identified as the primary motivation.

McKinsey #1

Though the top three reasons for addressing sustainability have stayed the same since the survey began in 2010 the order has changed.  One reason cited in the McKinsey & Co. report for alignment rising to the top is the increasing likelihood of CEOs to identify sustainability as a top priority.  Between 2012 and 2014 the number of CEOs identifying sustainability as the number one priority more than doubled.

Another explanation for the rise of alignment as a motivator may be that many companies have already pursued, or at least adopted, cost cutting programs and they are looking for the next opportunity to grow company value through sustainability.  This is consistent with another major finding of the survey:

executives see reputation management as having the highest value
creation potential over the next five years

Where cost cutting could reasonably be pursued through delegation to an operational or procurement function; value creation through reputation management requires a deeper integration with corporate mission, goals, marketing, branding, etc., hence the focus on alignment.

Driving home the potential of sustainability reputation management to create corporate value is the findings of a survey commissioned by Gibbs-rbb Strategic Communications and completed by Harris Poll in August of this year.  One of the key findings:

Americans are willing to spend an extra 31% per week on safe and
sustainably produced grocery food

The ability to consistently capture this premium from consumers requires active reputation management and enhancement as the poll also found that consumers are likely to switch from a trusted consumer brand if they learned the company was:

  • Involved in product recalls – 77%
  • Practices that harm animal welfare – 73%
  • Irresponsible labor practices – 72%

The full results of the survey including demographics breakdowns can be found in the Gibbs-rbb 2014 Conscious Consumer Study.