Dow Chemical 2013 Annual Report Download - page 86

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Dow’s Energy business and Public Affairs and Sustainability functions are tasked with developing and implementing a
comprehensive strategy that addresses the potential challenges of energy security and GHG emissions on the Company. The
Company continues to elevate its internal focus and external positions - to focus on the root causes of GHG emissions -
including the unsustainable use of energy. Dow's Energy Plan provides the roadmap:
• Conserve - aggressively pursue energy efficiency and conservation
• Optimize - increase and diversify energy resources
• Accelerate - develop cost-effective, clean, renewable and alternative energy sources
• Transition - to a sustainable energy future
Through corporate energy efficiency programs and focused GHG management efforts, the Company has and is continuing to
reduce its GHG emissions footprint. The Company’s manufacturing intensity, measured in Btu per pound of product, has
improved by more than 40 percent since 1990. As part of the Company's 2015 Sustainability Goals, Dow will maintain GHG
emissions below 2006 levels on an absolute basis for all GHGs.
Environmental Remediation
Dow accrues the costs of remediation of its facilities and formerly owned facilities based on current law and existing
technologies. The nature of such remediation includes, for example, the management of soil and groundwater contamination
and the closure of contaminated landfills and other waste management facilities. In the case of landfills and other active waste
management facilities, Dow recognizes the costs over the useful life of the facility. The accounting policies adopted to properly
reflect the monetary impacts of environmental matters are discussed in Note 1 to the Consolidated Financial Statements. To
assess the impact on the financial statements, environmental experts review currently available facts to evaluate the probability
and scope of potential liabilities. Inherent uncertainties exist in such evaluations primarily due to unknown environmental
conditions, changing governmental regulations and legal standards regarding liability, and emerging remediation technologies.
These liabilities are adjusted periodically as remediation efforts progress or as additional technical or legal information
becomes available. Dow had an accrued liability of $649 million at December 31, 2013, related to the remediation of current or
former Dow-owned sites. At December 31, 2012, the liability related to remediation was $685 million.
In addition to current and former Dow-owned sites, under the Federal Comprehensive Environmental Response, Compensation
and Liability Act and equivalent state laws (hereafter referred to collectively as “Superfund Law”), Dow is liable for
remediation of other hazardous waste sites where Dow allegedly disposed of, or arranged for the treatment or disposal of,
hazardous substances. Because Superfund Law imposes joint and several liability upon each party at a site, Dow has evaluated
its potential liability in light of the number of other companies that also have been named potentially responsible parties
(“PRPs”) at each site, the estimated apportionment of costs among all PRPs, and the financial ability and commitment of each
to pay its expected share. The Company’s remaining liability for the remediation of Superfund sites was $73 million at
December 31, 2013 ($69 million at December 31, 2012). The Company has not recorded any third-party recovery related to
these sites as a receivable.
Information regarding environmental sites is provided below:
Environmental Sites Dow-owned Sites (1) Superfund Sites (2)
2013 2012 2013 2012
Number of sites at January 1 290 286 126 120
Sites added during year 3 8 2 11
Sites closed during year (3) (93) (4) (7) (5)
Number of sites at December 31 200 290 121 126
(1) Dow-owned sites are sites currently or formerly owned by Dow, where remediation obligations are
imposed in the United States by the Resource Conservation Recovery Act or analogous state law.
At December 31, 2013, 64 of these sites (150 sites at December 31, 2012) were formerly owned by
Dowell Schlumberger, Inc., a group of companies in which the Company previously owned a 50-
percent interest. Dow sold its interest in Dowell Schlumberger in 1992.
(2) Superfund sites are sites, including sites not owned by Dow, where remediation obligations are
imposed by Superfund Law.
(3) The increase in the number of Dow-owned sites closed during 2013 is primarily due to expiration
of the term of an agreement with Schlumberger, which expiration terminated Dow’s remediation
obligations at a large number of sites formerly owned by Dowell Schlumberger.
Additional information is provided below for the Company’s manufacturing sites in Freeport, Texas; Midland, Michigan;
Philadelphia, Pennsylvania; and Camaçari, Brazil, the sites for which the Company has the largest environmental remediation
accruals; as well as a Superfund site in Wood-Ridge, New Jersey.