Liquid Laws

Liquid Laws
America's New Clean Water Rule affects business—what companies can do to mitigate the legislation successfully.

By Marta Chmielowicz

America’s New Clean Water Rule affects business—what companies can do to mitigate the legislation successfully.

Clean water is in abundance in the U.S. today, but that was not always the case. As recently as 45 years ago, U. S. rivers were so polluted that they were catching fire, Lake Erie was deemed “dead,” and only 60 percent of drinking water met safety standards. The Clean Water Act (CWA) dramatically improved this situation, reducing the number of polluted waterways in the U.S. from more than 60 percent in 1972 to 35 percent in 2012. But according to the Environmental Protection Agency’s (EPA) most recent National Water Quality Inventory, the work is far from over. Of the total miles of water formally assessed, 55 percent of rivers, 71 percent of lakes, and 78 percent of shorelines were reported to be in poor condition—unfit for swimming, drinking, or fishing.

Enter the Clean Water Rule, or Waters of the United States (WOTUS) rule. By reaffirming the connected nature of waterways and reducing ambiguity around the extent of the EPA’s jurisdiction, the rule seeks to address some of the main limitations of the CWA.

According to Emilio Tenuta, vice president of sustainability at Ecolab, the WOTUS rule adds value in two ways. “The Clean Water Rule provides some more definition around waterways and water bodies that were not clearly defined in the Clean Water Act, and it gets into green infrastructure as a way to drive water cleanliness,” he says. By drawing more attention to these areas, Tenuta believes that the WOTUS rule has the potential to impact companies’ water management and use at an operational level, ultimately benefiting both businesses and the environment.

However, the rule has also faced substantial backlash from many states, industry coalitions, and NGOs due to its ambiguity and wide breadth. Although the EPA says that the WOTUS rule narrows the scope of their jurisdiction, critics of the rule allege that it actually expands federal jurisdiction into previously unregulated areas. “I think the rule is a concern to everybody in the industry because it’s perceived as an exaggerated extension of jurisdiction by the EPA,” says Stewart Leeth, vice president of regulatory affairs and sustainability at Smithfield Foods.

Because the WOTUS rule covers such a wide geographic span and remains vague in its definition of what constitutes a viable connection to a jurisdictional waterway, critics have raised concerns about its implementation.

“There’s a lot of uncertainty, and it’s not very clear the extent to which the rule might impact a remote body of water that’s out in the country some[where],” Leeth explains. For example, if a farmer wants to eliminate a small, temporary pond on his land that is not connected to any other waterways, his right to do so would have to be evaluated on a case-by-case basis because of the pond’s potential functional connection to surrounding water bodies. If the farmer did not apply for a permit, Leeth says, his actions may be considered unlawful even though the body of water in question does not seem to fit the definition of waters that WOTUS specifies are governed by the CWA.

By focusing so heavily on the interconnected nature of waterways but failing to adequately define the bodies of water that fall under the CWA’s regulations, the WOTUS rule actually increases the need to analyze waterways on a case-by-case basis. Several industry coalitions—including the Waters Advocacy Coalition, Edison Electric Institute, and the National Sand, Stone and Gravel Association—have contested the WOTUS rule in testimonies to the EPA, stating that it complicates otherwise streamlined processes and carries an increased financial and regulatory burden for businesses seeking permits to operate.

There is also some ambiguity about how the new WOTUS rule will interact with existing local regulation surrounding the discharge of pollutants into waterways. “The specific regulations that are being executed at an operational level for a facility are state- or local-based, and a number of states want to better understand how this rule is going to impact their respective water users and the regulations they already have in place,” Tenuta says.

Since companies are required to comply with both local and federal regulations, conflicting rules may result in confusion and costly litigation. For example, in the Sept. 2004 case of U.S. v. Power Engineering Co., the EPA and Colorado Department of Public Health and Environment (CDPHE) conflicted in their enforcement of the Resource Conservation and Recovery Act (RCRA). As a result of conflicting compliance orders from federal and state authorities, Power Engineering Co. Was fined approximately $2 million for their violation of the rule even though they had complied with CDPHE orders. To combat this type of occurance, Leeth says that it is necessary to make sure that there’s a level playing field “so that all companies and municipalities have the same rules to go by, and that the rules are clear.”

Business-driven Strategies

Although the WOTUS rule could have possible negative consequences to business, there are ways to combat these effects. According to Skiles Boyd, vice president of environmental management and resources at DTE Energy, “Voluntary and regulation-driven activities should and do, in many cases, act in partnership for a better environment.”

Instead of merely relying on regulations to guide their water management programs, Boyd believes that it is essential for companies to recognize their responsibility in protecting the earth’s natural resources. In order to do so, Leeth and Tenuta emphasize that companies must set their own sustainability goals and strategies in order to stay ahead of regulatory changes.

For Ecolab, this means incorporating the concept of “water stewardship,” or the sustainable management of water as a shared, pubic resource, into their business strategy. “We look at water from a perspective of not only what we do to manage it within our own facilities, but also in terms of the impact that has outside our fences,” Tenuta says. In addition to monitoring their own operational water use, Ecolab’s approach to water stewardship includes actively working with customers on their water management strategies and partnering with leading non-governmental organizations (NGOs) to advance water stewardship standards globally.

Ecolab’s focus on global water stewardship as part of their business strategy allows them to stay progressive about their water management practices, avoiding challenges once regulation takes hold. According to Tenuta, such an approach also confers business advantages when managing physical, regulatory, and reputational risk.

Similarly, Dion McBay, sustainable development lead at Monsanto Co. says that such programs also deliver great benefits to customers. “Some of the most impactful business benefits are passed down to our customers in terms of both increased productivity and the cost saving of heightened efficiency,” he says.

Businesses can implement a holistic water management strategy in five steps to experience such benefits.

1. Take a global view of available water resources and assess its risk. “I think the starting place is trying to assess and measure the business’ needs and use from a broader perspective in terms of figuring out where your water is coming from, where those resources are, and what the future looks like for them,” Leeth says. Tenuta agrees, saying that “Companies should identify where their hotspots are around the world, and that can be related to water quality, availability, or both.”

Monsanto had success with this strategy, and it has allowed the company to better understand how water availability might impact their operations and the surrounding communities and landscapes. The company mapped water risks at all of its facilities across the globe in 2015—utilizing the World Resources Institute Aqueduct Map,—and gave Monsanto the insight needed to develop effective action plans to mitigate water risks, according to McBay.

2. Identify opportunities within those hotspot facilities. “That means that you go through and try to develop a footprint analysis of how water is being utilized in your facility,” Tenuta says. According to Leeth, this essential step allows businesses to create water reduction goals and targets that challenge people to measure water use and identify areas where water is wasted.

3. Develop action plans and track progress. “Tracking progress against action plans has enabled best-practice-sharing among site teams and suppliers and allows an increase in significant focus on water use and efficiency in our operations,” McBay explains.

4. Execute action plans in a way that drives that initiative and develops the right culture in the company to look at water differently. According to Boyd, integrating sustainability into a company’s strategy and culture has a number of business benefits, including providing value to investors and shareholders, increasing company reputation, and improving employee engagement.

5. Create partnerships and collaborative efforts to drive more sustainable practices in water management. For DTE Energy, partnerships with key environmental organizations have led to tangible results that enhance the quality of life in the state of Michigan for both its people and wildlife. At Monsanto, McBay emphasizes the value of sharing best practices in forging relationships and driving sustainability worldwide.


What is the WOTUS rule?

The Clean Water Rule, commonly referred to as the Waters of the United States (WOTUS) rule, was signed by the EPA and the U.S. Army Corps of Engineers (Corps) in June 2015 in an effort to more clearly define the scope of waters protected under the Clean Water Act (CWA). While the CWA has long given the EPA jurisdiction over “navigable waters,” the extent of this jurisdiction has been widely contested.

The WOTUS rule seeks to address this jurisdictional ambiguity by implementing a broader, more holistic approach to regulation that emphasizes the interconnected nature of human activity and subsequent impact on surrounding ecosystems. Through this approach, the WOTUS rule allows the EPA to hold wetlands and smaller bodies of water to the same quality standard as large waterways, provided that they lay within 4,000 feet from any navigable body of water (which most do). This acknowledges the connectivity of waterways and the potentially significant effects of pollution in small bodies of water. By narrowing the definition of “waters of the United States,” the rule seeks to eliminate the need for extensive case-by-case analyses and sets clear boundaries for businesses that risk water contamination in their operations.

However, whether the rule is effective in meeting these goals is a point of controversy for many. The WOTUS rule has prompted significant criticism among a number of states, trade associations, and NGOs, and it is currently being evaluated in court in response to the numerous lawsuits filed against it. Such lawsuits contest the EPA’s broad jurisdictional reach; For example, Hawkes Co., Inc., a peat-mining operation that had plans to mine a piece of property in Minnesota, filed a case after they were required to obtain expensive federal permits for wetlands that were roughly 120 miles away from the nearest waterway.

Posted February 2, 2017 in Sustainability