Small Business

An A-to-Z Green Analysis


More small businesses are using life cycle assessments to gauge—and reduce—their environmental impact

Fifty million dollars sure sounded good to Paul Nace. That's how much, in grants, the Energy Dept. said it would offer to selected biofuel makers to build new refineries. Nace is chief development officer of Framingham (Mass.)-based Biofind Technology, a 25-person, $5 million company that makes fuel from wood chips, pulp, and other plant matter. To qualify for the grants, applicants needed to perform a so-called life cycle assessment, which examines the environmental impact of a company's entire process. "It's a look at what is involved from the time [we] harvest the trees for feed stock to processing it and shipping it out the other end," says Nace.

Long the domain of larger companies, Life Cycle Assessment, or LCA, is increasingly used by entrepreneurs to evaluate their products and processes, and to gain a bit of eco-marketing distinction. The analysis, usually done by outside consultants, can cost anywhere from $4,000 to $50,000, depending on the level of detail and your business' complexity.

An LCA rates businesses primarily on eight criteria set by the International Organization for Standardization: global warming potential, ozone depletion, emission of chemicals leading to acid rain, production of chemical runoff, depletion of nonrenewable mineral resources, use of renewable resources, smog creation, and toxicity. "Every product has an impact," says Wayne Trusty, president of Athena Institute, an Ottawa nonprofit that specializes in LCAs for the construction industry. "It is a question of what impact and how big, compared to other competing products."

Companies like Charlottesville (Va.)-based McDonough Braungart Design Chemistry, better known as MBDC, take a slightly different approach, popularizing a "cradle to cradle" certification that emphasizes sustainability and the elimination of toxins. For MBDC, the ideal is that nothing is ever "thrown out," with materials being constantly reused instead.

In April, Biofind enlisted EarthShift, an environmental consultancy in Huntington, Vt., to perform an LCA. The assessment took two weeks and cost less than $10,000, Nace says. It studied the materials Biofind uses to create fuel, plus the energy required to harvest and transport them to its factory in Gorham, Me. It evaluated the chemicals and energy required to produce the fuel, emissions produced by the factory, and the energy required to transport the biofuel to consumers. Last, the analysis looked at consumers' use of the fuel and pollution that creates.

The LCA revealed that when Biofind processes cellulose, it creates a by-product called furfural, which can be further refined into a key biofuel component. Nace says the change will be incorporated into the new refinery it hopes to build. It also found Biofind's fuel produced 90% fewer emissions than gas or diesel fuel.

GOING FOR THE GOLD

Peter Strugatz and Miranda Magagnini were looking to eliminate waste and toxins from their company's production process and turned to MBDC for help. Their $12 million, 60-person business, IceStone, creates countertops and flooring from recycled glass. It was founded in 2003, when the pair bought a bankrupt glass recycling plant in the Brooklyn Navy Yard.

Magagnini and Strugatz spent 18 months getting a silver certification from MBDC. They then spent an additional year going for the gold, forming a sustainability team to analyze electrical and water use. They examined the glass they use and the pigments they add, hoping to identify and eliminate any toxins. They ended up replacing a few of their pigments, shifting to wind for half of their energy, and installing a water recycling system, saving about 5 million gallons per year. Magagnini won't say how much the certification cost, but says it's money well spent. "It is important to separate real green companies from the impostors," she says. Nace thinks his LCA has done the same for him—and in June he applied for that $50 million Energy Dept. grant.

Return to the BWSmallBiz August/September 2009 Table of Contents

Quittner is a staff writer for BusinessWeek in New York.

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