Power-Co, Inc. (PCI) is a multi-billion-dollar-a-year East Coast utility with more than 60 locations, including its group of nearly a dozen giant power-generation facilities. Initially, PCI asked a compliance consulting firm to work with them on the ongoing automation of the vast database of MSDSs that PCI is required to keep on the more than 10,000 chemical products used in their daily operations.

PCI had been saving some $300,000 a year by automating MSDSs, as opposed to dealing with them in hard copy. But the executives had not attempted to do any total chemical management from the compliance side using their MSDSs and their rich vein of related chemical information.

The consulting team used PCI’s automated MSDS data (constituting more than 111,000 pages of chemical information) as the basis for a possible Compliance-Side Total Chemical Management (CSTCM®) solution. In the discovery phase of the process, what the consultants found out about their utility client shocked them, and really shocked the PCI personnel—including their EHS people, financial leaders and executives.

Careful MSDS examinations revealed that:

• Of the 10,000-plus chemicals the company uses, only 11 percent are used at more than one of the corporate locations
• Nearly 8,000 of the chemicals were single-site exclusives

In short, what PCI had on its hands was an inefficient, grossly expensive, chemical management nightmare. The CSTCM consulting company drilled down a little deeper into the MSDS chemical-data gold mine and came up with some startling environmental-ingredient analysis. PCI had an unmanaged, multi-vendor mess on its hands. Working with the utility, the consultants immediately targeted the following obvious products for reduction through better procurement:

• Acetone (10 different vendors for this common product)
• PCP treated wood (more than 15 vendors)
• Hydrochloric Acid (more than 10 vendors)
• Sulfuric Acid (more than 10 vendors)
• Adhesives (more than 200 varieties)
• Solvents (more than 100 varieties)
• Paints (more than 150 varieties)
• Oils (more than 400 varieties)

As the consultants went through the data, they could see the PCI executives and EHS people turning pale. How many vendors do you need for acetone? One? Two? OK, maybe even three. But 10? How many types of adhesives do you need to run through your purchasing department? Of course, the answer is a lot fewer than 200. And oil? Maybe PCI needs 100 different oils, but they don't need well over 400 different varieties.

Unraveling and correcting just such extreme product-purchasing inefficiencies is one of the benefits of employing a CSTCM solution within company operations. Until an initial CSTCM inspection was applied to its inventories, PCI had no idea of what they had, or how much of it, or what was obsolete, unneeded or out of date. And that was good news in comparison to other revelations.

It got worse when the CSTCM consultants asked the automated MSDS data to reveal potential environmental hazards. Here are just some of the deadly toxins - notorious carcinogens, groundwater pollutants and hazardous substances - that were easily found, in one day by applying CSTCM:

• More than 100 products contained lead or lead compounds
• Almost 50 products contained trichloroethylene (TCE)

Figure 2 Forest Products CSTCM: Chemical Usage Listed above is chemical use data from five forest products companies of various sizes. All companies utilize local purchasing to fulfill the minor chemical needs of their operations. In all cases more than 70 percent of all chemical products used are used in just one location. Obviously many different products are being purchased for the same function and from a large set of vendor suppliers. Taken in the aggregate, this chemical use profile costs these companies millions in procurement transaction fees, administrative compliance costs, working capital inventory that carries charges and waste disposal expenses. Opportunities to reduce chemical product and vendor count will include material standardization between facilities and procurement optimization which focuses on selecting fewer vendors, fewer products, and more volume per product. Most CSTCM programs begin with toxic product reduction and then shift to consolidation of Maintenance, Repair and Operations (MRO) chemicals.

Figure 3 Pharmaceutical CSTCM: Chemical Usage Surprisingly the Pharmaceutical Industry has the highest percentage of chemicals purchased for use at a single site. One might think that because of FDA requirements that chemical products might be more closely scrutinized and more chemicals might be commonly used between sites and even between companies. As we can see, the opposite is true. Why? Several factors may be contributing: Research and Development scientists may insist on particular or rare chemicals, or ordering their own brand of chemicals A clean industry is less diligent in managing workplace exposure

If PCI completes a 50 percent reduction of its chemical nightmare (other CSTCM programs have accomplished as much as a 70 percent reduction of chemical inventories) the U.S. utility will start to save nearly $10 million annually. Even if PCI only accomplishes a modest 30 percent reduction of chemicals, they stand to save more than $6 million annually. That’s real economic recovery through CSTCM.

As always with CSTCM, the story does not end with the financial benefits. It doesn't begin to address the many benefits in worker safety, greater environmental health, better PR and greatly reduced corporate liabilities. Needless to say, the executives at PCI are now big believers in CSTCM.