Dow Chemical 2015 Annual Report Download - page 75

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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 2025 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 regulatory
requirements. The nature of such remediation can include management of soil and groundwater contamination and 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 the ability to apply 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 $596 million at December 31, 2015, related to the remediation of current or
former Dow-owned sites. At December 31, 2014, the liability related to remediation was $628 million.
In addition to current and former Dow-owned sites, under the federal Comprehensive Environmental Response, Compensation
and Liability Act ("CERCLA") 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 $74 million at
December 31, 2015 ($78 million at December 31, 2014). 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)
2015 2014 2015 2014
Number of sites at January 1 184 200 124 121
Sites added during year 7 6 7 5
Sites closed during year (11) (22) (7) (2)
Number of sites at December 31 180 184 124 124
(1) Dow-owned sites are sites currently or formerly owned by Dow. In the United States, remediation
obligations are imposed by the Resource Conservation and Recovery Act or analogous state law. At
December 31, 2015, 41 of these sites (46 sites at December 31, 2014) 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.
Additional information is provided below for the Company’s Midland, Michigan, manufacturing site and Midland off-site
locations (collectively, the "Midland sites"), as well as a Superfund site in Wood-Ridge, New Jersey, the locations for which the
Company has the largest potential environmental liabilities.
In the early days of operations at the Midland manufacturing site, wastes were usually disposed of on-site, resulting in soil and
groundwater contamination, which has been contained and managed on-site under a series of Resource Conservation and