INFORMATIVE VS. SEAL
OF APPROVAL ECO-LABELS
Organizations that award some form of "seal of approval," like ENERGY STAR, Green Seal, Canada's Environmental Choice and Germany's Blue Angel, can make identifying environmentally preferable products easier for consumers. Several of the purchasing officials we interviewed who have worked with Green Seal believe that the role Green Seal plays is an important first step. Indeed more than a hundred institutions and businesses work with Green Seal as "Environmental Partners" (see "Partnering Up With Green Seal"). Yet there are some drawbacks to uncritically purchasing products that bear a "green" seal of approval.
A common criticism is that seal of approval eco-labels mask trade-offs that were involved in the decision to certify a product. For example, Green Seal endorses compact fluorescent lamps (CFLs) which contain toxic mercury because CFLs have such a positive effect on decreasing energy consumption. The seal of approval nonetheless conceals the product's toxicity from the consumer.
Additionally, seals of approval may be awarded to types of goods and services that are inherently more wasteful than alternatives. Purchasers should be aware that some "approved" products may be the best of otherwise polluting technologies. Consumers should not be misled into believing that buying "green" products is sufficient when more fundamental changes to consumption patterns are necessary to solve environmental problems. For example, Green Seal has certified paper towels that are made from 100 percent recovered material (40 percent post-consumer material by weight). Government purchasing officials should recognize that there are less environmentally-harmful ways to satisfy the need to dry hands or surfaces, for instance frequently using a reusable cloth towel where health codes permit. Furthermore, in many cases the least environmentally burdensome procurement decision may be to reduce consumption and altogether forego purchasing certain types of products. Reducing and reusing are almost always preferable to consumption.
"Informative" eco-labels, which describe environmental attributes of a product rather than make an endorsement, seem to solve these problems by letting consumers make their own judgments, but these labels are also flawed. Scientific Certification System's Eco-Profile presents information about a wide range of environmental burdens associated with a specific product or service. But interpreting the Eco-Profile can be difficult and time-consuming. Since Eco-Profiles typically do not indicate how a product ranks in comparison to other products performing the same function, consumers may be unable to evaluate the amount of energy used or pollution produced by a product.
EnergyGuide labels are an improvement in this area since they indicate where each appliance's energy performance falls within the range of competing models, but they do not relieve purchasers of the responsibility of comparing potentially hundreds of brands to determine which is the best. Furthermore, analyzing products based on a single or select few environmental attributes is not an improvement over multi-attribute-based analysis.
Labels that verify an environmental claim, for example SCS's Environmental Claims Certification logo, perform an important function, but can be misleading when presented in a vacuum. While reducing the potential for consumers to buy products with deceptive or unsubstantiated environmental claims, claim verification labels are useful only if the claim to be verified is meaningful. For example, the UL Energy Verification label verifies that a product can be legally sold in the U.S., but it doesn't help consumers determine whether it is among the most efficient models in its class -- or whether the product has other significant environmental attributes. Moreover, a consumer who sees a verification label on a product may assume that it is endorsed by the verifier as "environmentally friendly." A consumer may be led to buy a ream of paper, for example, because it has been certified to contain 10 percent post-consumer recycled content. Meanwhile, the buyer may be unaware that this is a low percentage compared to what the federal government is directed to buy, or that many other brands have much higher levels of post-consumer recycled content. Without having someone interpret the information, the verified claim may be both true and misleading.
PROGRAMS THAT CHARGE FOR CERTIFICATION VS. FINANCIALLY-INDEPENDENT PROGRAMS
Many of the programs featured in this issue receive money from manufacturers when products are submitted for certification or verification. Examples are Green Seal, Environmental Choice (ECP), TCO, Blue Angel and SCS. In the case of seal of approval groups like Green Seal, ECP, TCO and Blue Angel, the same entity that accepts industry money is also setting voluntary, minimum environmental standards for the industry. Taking money from the businesses that one is trying to objectively influence creates the potential for certification organizations to be influenced by those businesses.
Green Seal denies that it is even theoretically open to financial influence from manufacturers. Writes Green Seal Director of Green Buying Services Kathleen Gray, "[W]e charge manufacturers the cost of certification and monitoring, but none of our general operating budget comes from manufacturer donations."
Yet assessing fees for certification or verification services has an additional drawback: the cost involved may frighten manufacturers away and therefore restrict the ability of each of these programs to assess a larger percentage of products on the market. Small companies may simply not be able to afford to apply. This problem may plague SCS whose Eco-Profiles have appeared on only small manufacturers' products since 1993. Though Green Seal has instituted a sliding scale fee schedule to make certification financially easier on small businesses, far less than Green Seal's target of 15-20 percent of the market have submitted products to Green Seal. As a result, there are a large number of energy efficient and environmentally preferable products on the market that are not evaluated by Green Seal.
ENERGY STAR does not require a fee for certification. This may be one reason why the program has attracted a sizable number of manufacturers to participate. We should not forget, however, that ENERGY STAR is able to certify qualified office equipment without charging manufacturers because ENERGY STAR does not require manufacturers to independently verify that their products deserve certification. This may make ENERGY STAR's recommendations occasionally unreliable (see "Programs that Help Consumers Identify 'Energy-Efficient' Products").
Furthermore, though some government programs are financially independent, they may be just as susceptible to outside influence as private eco-labeling programs. Political considerations influenced the EPA's failure to adopt totally chlorine-free paper standards. ENERGY STAR guidelines may likewise reflect political caution.
LEADERSHIP VS. MIDDLE-GROUND APPROACHES
Financial and political influence are not the only factors influencing environmental standards. A certification organization's choice of whether to endorse a sizable portion of the market or only best available technology has a critical impact on the rigor of seal of approval eco-labels.
ENERGY STAR, Green Seal, and Environmental Choice are examples of organizations that use a middle-ground approach, meaning that their standards can be met by a sizable portion of the market. A minority, if any, of their approved products are at the edge of environmental technology.
ENERGY STAR, Green Seal, and the Environmental Choice Program choose the middle-ground approach to entice a large number of manufacturers to qualify for certification so that the "Green Seal" or other eco-labels appear widely enough on store shelves to obtain mass acceptance and affect consumer behavior. These groups operate on the premise that without mass consumer appeal, they will not be able to influence corporations to manufacture environmentally-sound products. This motivates these organizations to set their standards below best available technology so that many manufacturers can meet the requirements. Green Seal, for example, says that they set standards so that they can be met by 15-20 percent of the market.
Middle-ground eco-labeling programs have limitations. The fact that 85 percent of the PC market could qualify for the EPA's ENERGY STARSM logo is not a result of the market's outstanding environmental achievements; it is a liability of the program since there is a wide range of energy performance among certified computers. TCO in Sweden has recognized this; they require certified computers to power-down to a lower wattage than ENERGY STAR. (See "Programs that Help Consumers Identify 'Energy-Efficient' Products.")
With a standard below technical potential, manufacturers have no reason to use the least-polluting technology or to find new, even less-polluting, technologies. In some cases, middle-ground standards are so weak that they may not influence the market at all. Two of Green Seal's standards reflect the minimum level allowed for products to be sold in the United States. The Green Seal standard for "water efficient" toilets is set at 1.6 gallons per flush, the federal law, even though several Green Seal-certified products use much less water. Likewise, Green Seal certifies kitchen faucets that emit up to 2.5 gallons per minute even though at this level they could certify every kitchen faucet legally manufactured since 1994.
The above two examples can partly be explained by the fact that Green Seal set its standards before legislation made these standards the law of the land. This, however, cannot be said of Green Seal's standards for showerheads. After federal law required all new showerheads to emit no more than 2.5 gallons per minute, Green Seal revised its showerhead standards only slightly -- to 2.4 gallons per minute. Even though showerheads are available that emit as little as 2.0 gallons per minute, Green Seal settled for 2.4 because this was all that Green Seal believed the top 15-20 percent of manufacturers were capable of achieving. Yet a .1 gallon per minute drop will not drive the market to develop showerheads that work much more efficiently, and may discourage companies from manufacturing showerheads that emit closer to 2.0. Green Seal's standards for re-refined motor oil can only be met by 5 percent of the market. But this is the exception rather than the rule. By failing to reward those companies that are truly leaders in the field, Green Seal, ENERGY STAR, and Environmental Choice may be marginalizing their impact.
What held Green Seal back from further strengthening its showerhead standards may be the most important drawback of setting middle-ground standards. Green Seal must rely on what industry claims can be done when Green Seal creates its qualifications for certification. According to Research Associate My Ton, Green Seal originally intended to set the showerhead standard at 2.2 gallons per minute. It backed off of this idea, however, after hearing primarily from industry representatives, in addition to other sources, that fixtures at that level would not perform adequately to satisfy consumers. This industry information could be inaccurate or biased since manufacturers have an interest in obtaining "green" certification with minimum research and development cost to themselves.
WOULD YOU BUY RECYCLED ENGINE OIL FROM EXXON?
The eco-labeling programs mentioned in this issue have an additional shortcoming. They don't currently address the manufacturer's overall environmental track-record. In fact, a seal of approval awarded to a product may mask the activities of a manufacturer that are environmentally harmful. Given its abominable environmental history, purchasing a recycled product from Exxon would more likely contribute to, rather than reduce, environmental harm. Yet if Exxon manufactured a qualified, re-refined engine oil, none of Green Seal's standards would forbid certification. In fact, Green Seal has approved General Electric light bulbs, even though GE has repeatedly violated federal laws. According to a 1994 report by the Washington, D.C.- based Government Accountability Project, GE has engaged in 16 instances of fraud since 1990 and has twice been convicted of criminal activity.
DON'T THROW OUT THE BABY WITH THE SOLAR-HEATED BATH WATER
Would the ideal environmental procurement policy merely encourage voluntary disclosure of information about the environmental impacts of products? Clearly not, though this is an approach heavily endorsed by industry. The Grocery Manufacturers of America (GMA), which represents Procter and Gamble and other major manufacturers of goods typically found in supermarkets, has argued that the best way to advance government procurement of environmentally preferable products is to adopt a system of "disclosure of environmental information in which suppliers of products would voluntarily disclose to procurement officers a list of factual, quantitative and substantiated information" on such attributes as energy consumption, resource and materials consumption, air emissions and solid waste. GMA adds, "The extent to which each of these issues is described would be left up to the supplier of the product. Those seeking to highlight a product's environmental attributes might elect to submit very detailed information. Other suppliers might elect to supply only general data that do not make any substantial environmental statements." GMA opposes the federal government's proposed reliance on third party certification organizations (see "EPA Considers More Comprehensive 'Green' Procurement Guidance").
Of all the eco-labeling schemes discussed so far, this approach is the least acceptable. Information from eco-labels is better than the information that manufacturers voluntarily disclose since the manufacturer of an environmentally destructive product could elect to provide no information to procurement officials about the product's environmental attributes. GMA's proposal represents no improvement over the status quo since there is nothing that currently prevents manufacturers from voluntarily submitting information to buyers about the environmental attributes of their products.
Government purchasers and other consumers need better information about the environmental attributes of the products they are considering buying. To become better informed, agencies should require disclosure of the multiple environmental burdens of products, and require the disclosure to be verified by an independent third party.
RECOMMENDATIONS
Eco-labeling programs can be useful. EPA should give agencies guidance on the types of products within each category that can be reasonably determined to be environmentally preferable (for example, chlorine-free paper, lead-free paint, CFC-free refrigerators, etc.). But purchasing officials should be cautious not to rely on eco-labels as the final word on the environmental preferability of goods and services under consideration. Some recommendations:
% Eco-labels should be the first, not final, basis for a procurement decision.
% Search for the highest environmental-achieving product that satisfies minimum performance standards.
% Whenever possible, use verification eco-labels and seek information that verifies manufacturers' reported energy-efficiency ratings and other eco-claims.
% Be aware that many eco-labeling programs pursue the "middle-ground" and certify products that do not use the best available technology.
% Recognize that existing seal of approval eco-labeling programs do not assess the whole market; there are other "green" products that have not been certified.
% Be aware that there are many different methods of conducting a life cycle analysis of products.
% Because existing eco-labels do not take into consideration the manufacturer's environmental record, be sure to look into their environmental and legal history. One resource is the Council on Economic Priorities (1-800-729-4237). For publicly owned companies, the best resource is the Securities Exchange Commission (SEC). Anyone can access a company's 10-K (financial statement) report and search the footnotes for required litigation disclosures by visiting the SEC's World Wide Web site and selecting the Edgar Database (http://www.sec.gov).
% Wherever possible, do your own comparisons (see "Doing Your Own Energy Comparisons").
% Consider the options of reducing consumption or purchasing reusable products before settling on certified products that are inherently more wasteful than viable, alternative means of addressing needs.