TL: Asea Brown Boveri (ABB) (GP) SO: Greenpeace DT: 1992 Keywords: toxics hazardous waste global warming east europe nuclear power sweden scandinavia europe business problems profiles gp / Greenwash snapshot #13: A case study in global warming, dumping in Eastern Europe, and nuclear greenwash. _________________________________________________________________ ABB Asea Brown Boveri Ltd. President & CEO: Percy Barnevik HQ: PO Box 8131, CH-8050 Zurich, Switzerland tel.: 41-1-317-71-11 fax: 41-1-317-73-21 Major businesses: electric power plant construction; power transmission design and manufacture, nuclear reactors. ABB was formed by the 1988 merger between ASEA of Sweden and BBC Brown Boveri of Switzerland, and operates through 1,300 companies worldwide. ABB is a member of the BCSD and a signer of the ICC's Rotterdam Charter. _________________________________________________________________ _ ABB is the world's foremost electrical engineering company, the leader in its core businesses of electric power production and transmission equipment. The company claims to guide "global environmental policy" and boasts that it was a "major participant" at UNCED. 1 Swiss billionaire Stephan Schmidheiny, who sits on ABB's Board of Directors and is one of the company's largest private shareholders, also served as chief advisor on business and industry to the UNCED Secretariat. 2 ABB suggests that western investment in Eastern Europe will provide an impetus for more stingent pollution regulation. BUT, from November 1991 to February 1992 the Polish government fined ABB thousands of dollars per day for dumping toxic wastes from its turbine factory in Elblag, Poland, on local farmland; this factory also discharged emissions two to three times the Polish norm (and 20 times the amount found in discharges from Swedish factories). ABB says it is a "clean technology company" and a "world leader in responding to environmental protection needs." BUT, it is marketing energy systems such as nuclear power and a new coal technology which emits nearly as much carbon dioxide -- the chief greenhouse gas -- as traditional coal-fired plants. ABB in Poland In recent years, lured by cheap labor, low production costs, and market potential, ABB has moved aggressively into Eastern European countries and the former Soviet Union, buying up bankrupt factories and entering into joint ventures. According to the company executives, this is part of a long-term strategy to shift ABB's manufacturing and export base from Western to Eastern Europe. ABB already has more workers in Poland than in France, Spain, or Denmark. At the end of 1991 ABB employed at least 15,000 people (7% of its workforce) in the region and plans to increase that figure to 35,000 by the mid-1990s. 3 ABB's CEO Percy Barnevik has spoken of "ecological disaster" in Eastern Europe and the former Soviet Union as if this experience will help raise environmental awareness in ABB and other Western companies and provide an impetus for more stringent pollution regulation. After less than two years, however, ABB has already established itself as a major polluter in one Polish city, Elblag. In mid-1990, ABB became the majority partner in a joint venture with Zamech, previously a state-owned enterprise. The new company, ABB-Zamech, runs a 3500-employee turbine factory in Elblag. ABB agreed at the outset to build a landfill for the over 50,000 tons of waste the plant generates annually. This waste includes large amounts of hazardous material such as used moulding sand laden with formaldehydes, cyanides, phenol, and synthetic resins. The company also agreed to install air pollution control equipment. By the end of 1991, however, Polish officials were angered by ABB's failure to make good on its promises. ABB had yet to build the landfill and the Polish press reported that the company had dumped 12-15 tons of waste next to the factory, covered only with a plastic sheet. Experts claimed that poisonous leachate was contaminating groundwater. "If ABB-Zamech does not build a proper landfill for toxic wastes," Elblag's mayor asserted, "it will have to take them to Sweden." 4 City leaders remain skeptical that the landfill will ever be built. (Moreover, because all landfills are a band-aid waste disposal measure and will leak eventually, ABB- Zamech should be developing ways to reduce toxic waste production. See Greenwash Snapshot # 15--BFI, for more information on landfills.) Polish environmental inspectors also discovered another site, on land leased from a local farmer, where since April 1991 ABB- Zamech had dumped 7,000 tons of spent moulding sand. Analysis showed levels of phenol which officials believed were contaminating groundwater, a potentially serious threat because the intake for a drinking water supply is less than two miles from the dump site. Although ABB claimed that the waste was harmless, government officials prohibited ABB from using the site as a landfill and fined the company over $200,000. 5 Payment was deferred by the local government upon acceptance of a rehabilitation plan. 6 Finally, because ABB had also failed to provide the promised air pollution reduction equipment, measurements of ABB-Zamech's smokestack emissions revealed dust concentrations two to three times the Polish norm (and 20 times the amount found in smoke discharges from Swedish factories) as well as levels of sulfur dioxide that were 24 times the norm. 7 In response to criticism, ABB repeated its pledge to install dust collectors in the smokestacks responsible for the pollutants. "Money has to be made, we aren't the Red Cross." --Eberhard von Koerber, ABB Executive Vice-President for Eastern European countries, 1990 8 "Clean, Green" Technology As a "clean technology" company, ABB is well positioned to provide the technical solutions and systems necessary for sustainable development. --from ABB's 1991 Annual Report 9 ABB says it provides "clean" power generation systems and focuses research on "green" technologies which can help solve global warming and other environmental problems. The company claims to be a "world leader in responding to environmental protection needs." 10 Given this, it would be reasonable to expect that ABB devote a significant portion of its multibillion dollar R&D budget to safe, renewable energy alternatives such as solar and wind power. No mention of these alternatives, however, appears in the company's 1991 Annual Report. Instead, the Annual Report points to substantial increases in R&D spending in fossil fuel-based technologies that contribute heavily to carbon dioxide emissions and global warming. "Clean coal" Burning coal produces far more carbon emissions than does the combustion of other fossil fuels. For an equal amount of net energy, coal releases about 25% more carbon dioxide than oil and about 75% more than natural gas. Between 1975 and 1990, rising world coal use accounted for more than half of the global increase in fossil-fuel carbon emissions; by 1990, coal was responsible for 42% of those emissions, the same percentage as oil. 11 Coal combustion also releases nitrogen and sulfur oxides which contribute to acid rain, the source of widespread forest damage in Europe, North America, and Asia. Despite these well-known environmental hazards, ABB recently began a potentially lucrative (revenues already exceeding $500 million in 1991) new generation of coal technology -- pressurized fluidized bed combustion (PFBC) plants. ABB calls these "clean" because PFBC plants release an estimated 59% less sulfur dioxide and 50% fewer nitrogen oxides than conventional coal facilities. However, PFBC emissions of carbon dioxide are only marginally less than traditional coal-fired plants. 12 Thus, while PFBC plants might partially alleviate regional acid rain problems, their increased use will only worsen global warming. ABB believes that coal reserves exist "in excess of 200 years," a further reason the company promotes "clean" coal as "a very attractive fuel choice." 13 The possible environmental consequences of using coal -- "clean" or otherwise -- for another 200 years are not discussed by the company. Natural Gas One of ABB's biggest businesses is in gas turbine power plants. The company reports that it has significantly increased R&D spending in gas turbine designs, another fossil-fuel based technology the company calls "clean." Compared with coal, natural gas does offer some economic and environmental advantages. State-of-the-art gas turbines produce power more cheaply than coal-fired plants, and with up to 65% less carbon dioxide emissions. These turbines can emit fewer nitrogen oxides and virtually no sulfur compounds. However, natural gas becomes dirtier when viewed in the context of production and development. Natural gas's main constituent is methane, a greenhouse gas with 63 times the Global Warming Potential (GWP) of carbon dioxide over a twenty-year period (and 21 times carbon dioxide's GWP over the span of a century). Fossil fuel production contributes about one-fifth of methane emissions into the atmosphere, with between 25-50% coming from natural gas pipeline leakage. (Coal mining accounts for a similar amount.) 14 Besides the problem of fugitive methane emissions, pipelines intrude into ecosystems with the threat of air, water, and land contamination. Offshore natural gas exploration and development degrade the environment in ways comparable to oil extraction: drilling muds; "toxic brine"; air pollution; and wetland loss. Tanker transport of highly flammable gas is dangerous due to the risk of explosion and toxic release. Natural gas processing facilities, because they deal with many combustible and toxic materials, pose hazards to the environment as well as to public health. 15 Both those who advocate an immediate phase-out of all fossil fuels and those who see a transitional role for natural gas in the switch to renewables will be disappointed to find that ABB's committment to natural gas is not contingent upon renovation of pipelines to eliminate methane emissions nor upon a "bridging" role for gas. In the end, ABB's coal and natural gas practices complement the oil industry's stated intention to develop all the oil in the world. 16 ABB calls these practices, which threaten the stability of the earth's climate, "sustainable" and "clean." This position is especially dubious given that solar and wind power are already technologically feasible and economically competitive. "Ultra-safe" Nuclear Power ABB predicts a revival in the fortunes of nuclear energy and has built a new reactor called PIUS (Process Inherent Ultimate Safety) that incorporates "inherent" or "passive" safety systems which rely on natural processes rather than machinery to operate. ABB describes this technology as "ultra-safe." 17 However, the UK's Atomic Energy Authority (AEA) has conducted one of the few systematic evaluations of these designs and concluded that while simpler, "inherent" systems are not necessarily safer than traditional systems. Engineers designed "inherent" systems to prevent causes of past accidents, according to the AEA, but have ignored other known problems which could lead to future disasters. Moreover, conventional reactors and those with "inherent" systems are equally vulnerable to structural failures. 18 ABB says that "environmental concerns" about carbon dioxide emissions "favor" nuclear power, the implication being that nuclear power can help stop global warming. This position is extremely misleading, and is one of the most dangerous pieces of greenwash yet concocted by industry (see Greenwash Snapshot #8: Westinghouse). ABB and Iraqi Nuclear Buildup In December 1991, the International Atomic Energy Agency (IAEA) published a list of foreign supplies and suppliers to the Iraqi nuclear weapons program. Among the equipment found was a large cold isostatic press manufactured by ABB. The IAEA said that this press, like the other equipment, was "application-specific" and asserted further: "While much of the equipment is multi- purpose in the sense of being useful in a number of manufacturing processes, the presence of application specific features removes most doubt as to the intended use." 19 ABB acknowledged that it sold the press to Iraq in 1990 but said the Iraqis had guaranteed that it would not be used to make nuclear weapons. "[I]t's unfortunate that the equipment was found where its use can be questioned," an ABB spokesperson explained. 20 ABB and Hydro-Quebec Although it receives short shrift in comparison with coal, gas, and nuclear power, "hydro-generation" also falls under ABB's umbrella of "sustainable" electricity sources. The company provides equipment to a number of large hydro-power projects worldwide, although such projects are well-known for flooding forests, ruining wildlife habitats, and uprooting entire communities of indigenous peoples. 21 Hydro-Quebec's James Bay scheme is the largest and potentially most destructive hydroelectric project in North American history. Its second phase -- now on hold -- threatens to displace 18,000 Cree and Inuit people, destroy 11 rivers, and adversely affect a wilderness area the size of France. Despite this, ABB is still doing business with Hydro-Quebec. In 1989, ABB Canada signed a joint venture with Hydro-Quebec to develop transmission technology. The next year, ABB received a $100 million contract from Hydro-Quebec to install electrical equipment. And in 1991, ABB's subsidiaries in Canada and Sweden signed a $30 million contract with Hyrdo-Quebec to supply additional electrical equipment. 22 For more information contact Jed Greer(author) or Kenny Bruno, Greenpeace Toxic Trade Campaign, 212-941-0994, extension 205 or 209. Notes 1. ABB Annual Report 1991, p. 26. 2. According to the French journal Bilan("Dossier: Stephan Schmidheiny," November 1990, p. 135), Schmidheiny owns an 18% stake in BBC Brown Boveri Ltd. Based on BBC's 50% ownership of ABB Asea Brown Boveri Ltd., Schmidheiny may own 9% of ABB. 3. See Kevin Liffey, "Eastern Europe: Zurich-based ABB seeks to electrify reforming Eastern Europe," Reuter News Service, 16 October 1990; and "Finland: ABB chief sees Baltic area as key economic region," Reuter News Service, 15 January 1992. 4. "Polish-Swedish Waste," in Gazeta Wyborcza, 5 December 1992. 5. Iza Kruszewska, Greenpeace International, correspondence from December 1991. Tests results revealing phenol content from WIOS(County Pollution Inspectorate), 11 November 1991. 6. Kruszewska correspondence, July 1992. 7. Kruszewska correspondence, December 1991; see also article from Swedish magazine SIF tidningen, 3 May 1992. 8. Liffey, ibid. 9. ABB's Annual Report 1991, p. 27. 10. ibid, p. 26. 11. Chrisopher Flavin, "Building a Bridge to Sustainable Energy," in State of the World 1992, a Worldwatch Institute Report, Washington, DC, 1992, p. 30. For other information on coal see Peter Ciborowski, "Sources, Sinks, Trends, and Opportunities," in The Challenge of Global Warming, D.E Abrahamson, ed., Washington, DC & Covelo, CA, 1989, pp. 213-230. 12.According to ABB (quoting from a 13 August 1991 article in Energy Daily), PFBC plants release 10% less CO2 than conventional coal plants. This may be optimistic; according to Flavin, ibid, p. 36, PFBC plants emit more CO2 than conventional ones. The Applied Energy Systems Corporation, Arlington, VA, has compiled a "Comparison of Carbon Emissions From Fossil Fuels" study. According to Jennifer Lowry of AES, PFBC plants fall within the parameters of carbon emissions listed for all coal plants. Information on other PFBC emissions from Bob Travers of the Office of Fossil Energy of the Department of Energy. 13. ABB 1991 Annual Report, pp. 14 & 40. 14. Environmental Data Report, 2nd edition, United Nations Environment Programme, London, 1989-90, pp. 6-7. See also The Ecologist, vol. 21, no. 4, July/August 1991, p. 162, for more information on methane sources. 15. Carol Alexander, Greenpeace, Natural Gas: Bridging Fuel? Or Road Block To Clean Energy?, pp. 9-14. 16. This intention from Greenpeace personal interview with ENI CEO Cagliari and Shell representative, 1992. For impact of oil production and consumption see Greenwash snapshot #2 on Shell. 17. ABB 1991 Annual Report, p. 15. 18."Outlook on Advanced Reactors," in Nucleonics Week, 30 March 1989, pp. 7-10. See also Christopher Flavin, "Slowing Global Warming: A Worldwide Strategy," Worldwatch Paper 91, October 1989, pp. 36-37. 19. IAEA Press Release "Foreign Supplies To The Iraqi Nuclear Programme," 11 December 1991. 20. "Sweden: ABB says it sold equipment found in Iraqi Nuclear Programme," Reuter News Service, 12 December 1991. 21. See Cynthia Pollock Shea, "Renewable Energy: Today's Contribution, Tomorrow's Promise," Worldwatch Paper 81, January 1988, pp. 12-14. See also Steve Turner and Todd Nachowitz, "The Damming of Native Lands," in The Nation, 21 October 1991. 22. "Canada: ABB power systems of Sweden wins order from Hydro- Quebec," Svenska Dagbladet, 23 August 1991, and "Canada: Asea Brown Boveri wins $30 million contract with Hydro-Quebec," Financial Post, 4 July 1991; Canadian Chemical News, April 1990; "ABB. Tosi Agree to $310 Million as Price in Spinoff," Wall Street Journal(Europe Edition) 16 December 1989.