Month: March 2024

Municipal bond issuers are responsible for building and supporting the physical infrastructure and the public goods and services that enable citizens to participate more in an inclusive economy. That makes the roughly $4 trillion US municipal bond market fertile ground for impact investing. Challenges like supplying clean water and improving access to quality healthcare can both be tackled through environmentally, socially, and financially productive investments in communities and institutions.

Leading When Water Is Lacking

As we’ve seen over the past few years, access to water can’t be taken for granted. The country faces historic drought conditions in the West and other regions. For instance, the Rio Grande, a river that countless Southwestern US communities depend on, faces persistent drought and increased water demand.

These challenges disproportionately impact low-income communities. In one study, 14% of respondents said a $12 monthly increase in water bills would lead them to cut back spending on groceries and basic medical care.1 Long-term investments in projects that diversify water sources, combined with water conservation strategies, can go a long way toward improving drought resiliency and reducing the financial burden communities face.

Take El Paso Water, which provides water, wastewater, reclaimed water and drainage services to more than 678,000 residents of El Paso, Texas, and surrounding areas. El Paso’s median household income is 76% of the state’s median; its 18% poverty rate is 29% higher than the statewide rate.

Since El Paso adopted its Water Conservation Ordinance in the early 1990s, per capita water consumption has fallen by roughly 35% and peak water demand by 17% (Display). Strategies implemented include reducing water waste in utility operations through initiatives such as leak detection and maintaining a rate structure that encourages conservation. Education is a lynchpin in galvanizing residential and commercial customers to be more efficient.

The issuer understands the population it serves, so its rates are affordable relative to national medians. And a change in the most recent budget waives the water-supply replacement charge for El Paso’s lowest water users. In fiscal year 2018–19, roughly 50% of all goods and services bought by the issuer were sourced from small, minority, and women-owned businesses, and almost 34% of its construction-project spending was directed to those vendors. By understanding the unique needs of the communities they serve and implementing long-term strategies to address them, municipal issuers like El Paso Water create more equitable and sustainable systems. It’s a model that also applies to healthcare institutions.

Opening Access to Care

Consider that for patients, roughly 20% of health outcomes are determined by the quality of healthcare from providers. The other 80% stem from factors often referred to as social determinants of health (SDoH): substandard housing, poor education systems, neighborhood violence, drug addiction, violence, and food insecurity.2

Recognizing this, many healthcare institutions are transitioning their missions from treating disease to also helping prevent it. For example, Temple University Health—a safety-net hospital—was originally founded to care for patients with limited incomes and ensure access to care in its surrounding Philadelphia neighborhoods. Today, it serves a population in which 45% of households are below the federal poverty level3—versus only 7% in adjacent Montgomery County. Roughly 33% of Temple Health’s gross revenues come from Medicaid—that’s more than double the average share among the nonprofit hospitals tracked by Moody’s (Display).

Temple Health’s impact extends well beyond the bedside. Its Center for Population Health, established in 2014, includes patient-centered medical homes, chronic-disease management programs for high-risk populations using nurse navigators, an inpatient and outpatient community-health work program, peer coaching, and central access for scheduling and follow-ups.

To help patients with complex social and medical-health issues, Temple’s Community Health Worker team visits homes, schedules and attends doctor appointments, coordinates transportation, and connects with other social supports to improve quality-of-life and treatment outcomes.

In 2020, Temple launched the Multi-Visit Patient Clinic to provide a full continuum of care for patients with high emergency-department use and frequent inpatient admissions. On discharge, community health workers link patients with follow-up healthcare, provide meals and transportation, visit homes, and connect with other social supports. Clinic patients have reduced emergency department use by 40% and inpatient use by 21% while increasing the use of outpatient services by 50%,4 demonstrating that they’re seeking more appropriate care in effective settings.

Temple Health also collaborated with local nonprofits, launching a two-year program to help 25 homeless Medicaid patients who frequent hospital emergency departments. Patients are provided free housing and caseworkers to connect them with health and social services. Caseworkers assist patients by furnishing apartments, connecting them with healthy meals, and helping them apply for income assistance such as Social Security.

This program isn’t large, but its impact is. When we compare the first five months that participants were housed to their experience before the program, there was a 75% reduction in emergency department use, a 79% reduction in inpatient hospital admissions, and a 50% increase in outpatient services use.5

Clear, Measurable Impact

Ultimately, the municipal bond market and impact strategies can play huge roles in channeling capital to financially productive uses that also help address environmental and social issues disproportionately affecting marginalized communities. The key is to identify strategies that employ meaningful data and project relevant key performance indicators. These play a vital role in developing better insights on investments and judging how effective they are. Investors play a critical role in supporting municipal issuers that are making a positive impact in their communities. By putting capital to work thoughtfully, they can help build a more equitable and sustainable future for all.

1 https://www.nature.com/articles/s44221-022-00009-w 
2 https://www.uclahealth.org/sustainability/our-commitment/social-determinants-health 
3 https://cph.temple.edu/about/news-events/news/temple-commits-1-million-immigrant-and-vulnerable-populations-healthcare 
4 https://www.templehealth.org/sites/default/files/2022-06/FY22-CHNA-Temple-University-Hospital.pdf 
5 https://www.templehealth.org/about/news/program-aimed-at-providing-housing-support-services-for-people-experiencing-homelessness-sees-75-decrease-in-emergency-department-visits-and-79-decrease-in-admissions

The views expressed herein do not constitute research, investment advice or trade recommendations and do not necessarily represent the views of all AB portfolio-management teams. Views are subject to revision over time.

Learn more about AB’s approach to responsibility here.

Originally published in Crown Holding’s 2022 Corporate Responsibility Report

Water scarcity is affecting an increasing number of regions worldwide. Our recognition of the need to use water with considerable care is the driver behind the Resource Efficiency pillar of our Twentyby30™ sustainability program and grounds our comprehensive water stewardship strategy. We understand that we must be good stewards of this limited and shared resource that is vital to the well-being of the environment, human beings and business operations.

Our Use of Water 

Water is used in many steps of our manufacturing and filling processes. In our facilities, it supports the forming, washing, rinsing and cooling of beverage cans and glass bottles, as well as the separation of sand for glass production. It is also an important element in the manufacture of aluminum and the production of the various beverages made by our customers. Even though Crown’s facilities require freshwater inputs, most of this water returns to the water system and zero water is present in our final product. As a result, beyond evaporation, Crown does not consume water on its final products except for a minimal amount of water attached to the sand sub-product of the glass making process.

We source water from a combination of third parties, surfaces and wells, depending on the operating location. Once utilized, water is sent through an onsite wastewater treatment system prior to its discharge. While a few locations release directly into surface water areas, approximately 95% of our facilities discharge into third-party municipal wastewater treatment systems. Plants that treat wastewater on-site monitor at minimum biological oxygen demand (“BOD”) and chemical oxygen demand (“COD”) parameters, in addition to any parameters required by local discharge and/or operational permits. All discharge follows local regulations. In some cases, including our operations in Mexico and Brazil, the quality of the water discharged is superior to the water that is withdrawn.

Our Approach 

With a diverse geographic footprint, environmental conditions vary from plant to plant. We identify waterrelated impacts by evaluating annually the specific data in each of our locations and developing action plans to address identified risks and opportunities. Our assessments include our incoming and outgoing water as well as the sources and points of discharge. Our water withdrawal is validated through an external third-party verification process. The World Resources Institute’s (WRI) Aqueduct global water risk mapping function also helps us assess water stress and understand which of our sites are located in water-scarcity areas. These sites are subject to partnered replenishment projects, which aim to preserve watersheds for the importance they hold in the community and the environment. We have also signed the United Nation’s CEO Water Mandate and committed to collective action to replenish 100 watersheds. This work aligns with our Twentyby30™ goal to replenish 100% of water consumed from high scarcity watersheds by 2030.

Our Ambition 

We aim to responsibly manage water for the long-term protection of the ecosystems and communities where we live and work. Our water stewardship strategy decreases the potential for business disruption while helping protect scarce resources at the watershed level by taking multiple actions including:

Identifying and eliminating losses and leaksIdentifying and incentivizing water reuse opportunitiesPiloting and replicating new and hybrid technologies toward Minimal to Zero Liquid DischargeMonitoring and recording wastewater quantity, quality, compliance and location of dischargeAdopting company-wide standard operating procedures defining wastewater discharge quality and standard monitoring requirementsEnsuring all employees have continued access to safe drinking waterEnsuring all employees have continued access to sufficient and clean personal hygiene facilities, supplies and educationValidating the number of plants in high water scarcity locationsIdentifying watershed level projects to implement in high water scarcity locations and executing these initiatives in collaboration with local partners

Compliance with local and national laws and regulations is a priority for Crown. Most of our locations are subject to strict national and local regulations on effluent quality. All incidents related to wastewater exceedances are registered and investigated, and corrective actions are implemented where necessary.

Crown plants and offices have readily available potable water that is unlimited and free of charge to employees. Sanitary facilities, including toilets and hand/face washing facilities, are also available across all our facilities.

“Our water stewardship strategy decreases the potential for business disruption while helping protect scarce resources at the watershed level”

Brazil Water Protection Project

The Piracicaba, Capivari and Jundiai (PCJ) Watershed is one of São Paulo’s most important watersheds. Composed of three watersheds, Piracicaba, Capivari and Jundiai, it supplies drinking water for more than 10 million people. The PCJ Consortium is an intermunicipal consortium formed by constituents of the Piracicaba, Capivari and Jundiai Basins. It is a non-profit association which aims to recover the springs in its area of coverage.

In recent years, the PCJ region has faced a severe water crisis, resulting in a significant change in water consumption habits as well as land conservation efforts.

In 2022, Crown supported The Nature Conservancy (TNC) on a water conservation project called the São Paulo Water Fund to protect 100 hectares of forests in the Jundiai Mirim Watershed.

The São Paulo Water Fund – established in 2007 – is a broad initiative with several partners and is coordinated by TNC. The effort aims to create the institutional and financial conditions to support the implementation of nature-based solutions to increase water security in the São Paulo Metropolitan Region (RMSP). The goal is to improve the ecosystem health of the watersheds supplying drinking water to the region.

The water supply for Crown’s Cabreúva facility is within the PCJ basin. The Jundiaí Mirim Watershed is a subbasin of the PCJ and is approximately 40 kilometers from Crown’s plant.

To learn more about Crown Holding’s commitment to corporate responsibility, visit our sustainability webpage.

For full details about Crown Holding’s 2022 Sustainability Report, visit here.

By Virginia Brown

As Duke Energy strengthens the electric grid to be more resilient and reduce outages, the company is offering money-saving programs to customers while ensuring it can handle the increase in electric vehicle (EV) adoption.

Charging EVs during off-peak hours, when fewer people are using electricity, allows the grid to function more efficiently – behaviors that can help keep costs down by reducing the need for new infrastructure.

When Kevin Davis of Indiana, a new EV owner, bought his Tesla, the company suggested he look into tax incentives and other discounts through the state or his electric utility. That’s when he learned of Duke Energy’s EV Off-Peak Credit program.

The pilot program, which launched in Indiana in 2022, helps Duke Energy customers with EVs save money on their monthly electricity bills when charge their vehicles during off-peak hours (Monday through Friday, 9 p.m. to 6 a.m., plus holidays and weekends).

Davis, founder and CEO of Indiana Charters, an Indianapolis-based charter school consulting company, takes advantage of the program since it’s easy and saves him money.

“It’s all automated,” Davis said. “I don’t even have to think about it. They even surprised me with a gift card.”

In the six months since Davis switched from a gas-powered vehicle to an EV, reports indicate a savings of $1,167, including the $100 gift card credits from Duke Energy.

Through financial incentives, the company aims to shift demand on the energy grid to times when it is used less, which is important since about 2 million EVs are expected to be on the road in Duke Energy’s service territories by the end of 2030.

When is off-peak EV charging?

Monday through Friday, 9 p.m. to 6 a.m., plus holidays and weekends.

It’s why the company expanded incentives for off-peak EV charging in 2023. Through a pilot program, eligible Florida customers who have a Level 2 EV home charger can receive a $10 monthly bill credit.

In Indiana, the program provides a $50 quarterly credit for two years, totaling $400 per customer.

The goal, said Candyce Marsh, manager of program management transportation electrification at Duke Energy, is to support customers’ EV transition by offering programs that are simple and easy to take advantage of.

“The good news,” she said, “is that program enrollment has exceeded expectations.”

In 2023, the Florida program reached 2,000 enrollees, which shifted peak grid consumption equivalent to the annual use of several dozen homes.

“It demonstrates that voluntary-managed charging programs can help balance demand on the grid with little inconvenience to customers,” Marsh said. “We want people to be able to simply, ‘set it and forget it.’”

That’s the case for Davis.

“The convenience of charging is incredible,” he said. “I plug in when I get home from work and program my car to charge fully, which for me is 80%. It’s not only not an inconvenience; it’s more convenient.”

Duke Energy’s EV programs

Use the EV Savings Calculator to see how much you’ll save by switching to an EV or the EV Selector Tool to help find a vehicle that’s right for you at EVs – Duke Energy (duke-energy.com).

Programs vary by service area but may include off-peak charging, charger options and installation credits. To see programs available in your area, visit EV Complete – Duke Energy (duke-energy.com).

View original content here.