September 5, 2024
Denver-based Leprino Foods Company generates some of its own water. In fact, the company holds a water right for water developed at its Greeley manufacturing facility.
“We actually are contributing more water to the river than we take in from our municipal source,” says Erik Nielsen, associate general counsel at Leprino Foods, which is the world’s largest producer of mozzarella cheese and a global producer of whey protein and other dairy ingredients.
Leprino has been a net contributor to Colorado watersheds since at least 2017. In 2020, the company was granted a water right associated with the quantity of water that it conveys to the Poudre River after deducting the amount of water that it takes in from municipal sources.
Milk is about 87% water. The process of evaporating or concentrating milk products produces condensate of whey water. Leprino recovers this water and stores it on-site in silos, often reusing it multiple times. Later, it is cleaned to stream quality standards and discharged. This, in addition to other water efficiency and recovery projects, generates about 600 acre-feet per year, or enough water to supply around 1,000 homes for a year. Leprino licenses most of this byproduct water to the City of Greeley for municipal uses, says Nielsen.
These water-saving processes not only reduce the company’s environmental footprint but are also critical to Leprino’s manufacturing future in Colorado.
“It seems like you shouldn’t be doing business in Colorado if you’re not thinking really deeply about water,” says Nielsen. “You’ve probably heard the saying, you never think about the value of water until the well runs dry.”
Water is required for cooling, heating, washing, diluting and other processes at nearly 6,000 manufacturing facilities in Colorado. As historic droughts threaten water availability across the state, consumers increasingly demand water-smart practices, and inflation continues to squeeze the private sector, many manufacturers are shifting their approach to water use and conservation.
“Manufacturers are increasingly becoming good stewards of water,” says JC Ye, corporate business director of water reuse at Veolia, a global water services company. “Many have a strong incentive to implement water stewardship practices and invest in improving the reliability of water supply. In most industrial processes, disruption of water availability has an immediate, acute impact on manufacturing operations.”
But water is highly contextual. Every river and stream has a unique ecosystem and different needs depending on the season. Solutions to protect and restore these resources are just as complex. Companies are taking a variety of approaches to water stewardship, from investing millions in local conservation work to making small but impactful infrastructure upgrades.
A reputational imperative
The original Coors brewery was built in Golden specifically for Clear Creek’s remarkable water quality. The company has a history of conducting projects aimed at protecting this water, which ends up in its product. As a founding member of the Clear Creek Watershed Foundation, the Molson Coors Beverage Company has helped to clean up some of the estimated 1,600 orphaned mines in the watershed, which threaten water quality by overflowing and discharging heavy metals and mine drainage into the river.
These days, water stewardship is about both public perception and product quality: Consumer-facing brands like Coors know that they face a reputational risk if they don’t invest in water-use reduction and watershed protection.
“[People] need to have confidence that we are serious about our water use, that we’re serious about protecting the watershed,” says Ben Moline, director of water resources and environmental policy for Molson Coors Beverage Company.
The entire state of Colorado has experienced severe to extreme drought on and off for more than two decades. The public is watching water use more closely as resource scarcity becomes a more serious concern. Recently, some communities have pushed back against water consumption for manufacturing.
BlueTriton — the owner of major U.S. bottled water brands, including Poland Spring — has been embroiled in legal battles with water boards, environmentalists, and other activists across the country for years. The company pumps water from Colorado’s Upper Arkansas River Basin, a semi-arid region particularly impacted by historic drought. In July 2021, about 20 community members protested outside of the Chaffee County Courthouse, opposing the renewal of a permit that allows BlueTriton to export 65 million gallons of water per year. After negotiating more than $1.25 million in community contributions from BlueTriton, county commissioners approved the permit the following month.
Veolia found in a 2023 study that fewer than 30% of surveyed companies had set water conservation goals, with water lagging behind carbon and waste as the environmental priority for companies. But Ye notes a recent shift in the way companies approach sustainability. Water scarcity concerns, public pressure, reputational risk, and cost-saving opportunities are leading to the proliferation of water initiatives across the private sector.
Michael Kiparsky, founding director of the Wheeler Water Institute at the University of California Berkeley School of Law, sees this as an opportunity: “Can we use transparency coupled with some degree of public awareness of water as a resource to put pressure on corporate entities to do something that might not be strictly in their economic interest otherwise?”
Small changes, big impact
The Coors brewery in Golden uses an estimated 2.7 billion gallons of water from Clear Creek each year: about 782 million gallons for its products, and 2 billion gallons for brewing processes, including production and malting. Of those 2 billion gallons of process water, 95% is cleaned and returned to Clear Creek.
This is representative of manufacturers at large: According to the Colorado Water Plan, industrial users account for only 3% of Colorado’s total annual water consumption, or water that is permanently removed from its source.
“We are diversion heavy, but depletion light,” says Moline, noting that Molson Coors is actively working to bring its water consumption rate even lower, while continuing to work with the Colorado Department of Public Health and Environment (CDPHE) to ensure wastewater discharged back to Clear Creek after treatment meets permit requirements.
Molson Coors treats wastewater from its operations as well as much of the City of Golden’s wastewater. The company entered into a consent order with CDPHE earlier this year to address permit exceedences for total suspended solids, metals, oil and grease, and whole effluent toxicity in its discharge water. Even before the consent order, the brewery began upgrading its wastewater treatment plant in preparation for meeting tightening water quality limits. Water treatment improvements are big changes with big impact, but small infrastructure changes also lead to big results — for example, fermentation tank design.
A few times per month, depending on the type of beer, the brewing team empties each fermentation tank through a valve on its side, leaving a small amount of beer just below the valve’s opening. The team clears the excess beer and thoroughly cleans the floor of the tank to prepare for the next batch, using water and a squeegee multiple times over. Across more than 100 fermentation tanks of varying sizes, which produce approximately 9.7 million barrels of beer per year, a portion of beer is lost in the cleaning process.
Molson Coors Beverage Company is updating its fermentation tanks to a new, vertical design with a cone-shaped bottom, through which a valve completely empties the beer directly below the tank. Now, the brewery can produce the same number of barrels for less, because beer — and water — isn’t left on the tank floor. This means less water used for malting, heating and cooling beer that ultimately doesn’t make it to consumers, and less water used in the cleaning process.
The upgrades are a part of Molson Coors Beverage Company’s G150 project, in honor of the 150-year anniversary of the Coors brewery’s inception. The company has invested “several hundred million dollars” in the project, which is expected to save 80 million gallons of water annually after its completion by the end of 2024. Moline says that upgrading its fermentation tanks is contributing a large part of these water savings.
Other food and beverage manufacturers are updating infrastructure to save water: Swire Coca-Cola, which produces, sells, and distributes Coca-Cola and other beverages in 13 states across the American West, says that it installed a new filtration and recovery system at its Denver plant to reduce water usage by about 20%. And Bellvue-based Morning Fresh Dairy, a fifth-generation dairy farm that produces the nationally popular Noosa Yogurt brand, installed an automated clean-in-place system to clean the interior of food and beverage process pipes, reducing water consumption by 30%.
Corporate mandates
PepsiCo, Amazon, Google and Facebook have all committed to being water-positive, or replenishing more water than they use from natural systems, by 2030. In addition to water-efficiency projects, much of this work is done through cross-sector partnerships, which have provided critical support to local water stewardship efforts.
“Corporate support has been very important to our ability to staff project work and, even more so, to purchase water for streamflow restoration,” says Kate Ryan, executive director of the Colorado Water Trust.
For example, the tech giant Intel relies on the Colorado River and the Rio Grande to supply water downstream to its Arizona and New Mexico manufacturing facilities. The company has partnered with the Colorado Water Trust and Trout Unlimited on multiple projects to support the Colorado River watershed. Intel reports that 120% of the water it used across the U.S. in 2023 was either returned to the source or restored through investment in water stewardship projects.
The Colorado Water Trust has received more than $421,000 in corporate funding from companies like Intel, Coca-Cola, MCBC, Seltzer, and Niagara Cares, a philanthropic arm of Niagara Water, since 2019. This money, in addition to foundation funding, individual contributions, and water donations, has enabled the organization to lease well over 10,000 acre-feet of water, which would typically cost $400,000 to $2,500,000, depending on the water right, says Ryan. The projects improved flows on the 15-Mile Reach of the Colorado River — a critical stretch of river for endangered fish species near Grand Junction, Colorado — as well as on the Yampa River and tributaries to the Fraser River.
And while BlueTriton has received pushback from community members on its water use, the company has partnered with Colorado Parks and Wildlife to dedicate a conservation easement to preserve 122 acres of wildlife habitat and protect groundwater resources along the Arkansas River.
“These sustainability programs work well, and Western rivers would benefit from more of them,” says Ryan. “The amount of water they have made possible for streamflow restoration in recent years is significant.”
But experts agree that the pathway to meet water-positive goals, or even water-neutral goals, is not straightforward.
Context is key
“Being ‘water neutral’ in an honest way requires a great amount of thought and engagement with people who have direct interest or represent the interest of the communities and environment that might be affected,” says Kiparsky.
In 2023, the nonprofit Ceres published a benchmark analysis of 72 companies from four water-intensive industries — apparel, beverage, food, and high-tech — and found that only 35% consider contextual factors such as local watershed conditions, regulatory dynamics, and community water needs when assessing water use risks. Only 14% consider contextual factors when assessing water quality risks.
“[We] found that while many companies are setting goals aimed at using less water, most are not setting strong targets to reduce water pollution,” says Kirsten James, senior program director for water at Ceres. “We also noted a lack of commitment around protecting freshwater ecosystems and clean water supplies for communities.”
Where and when water is replenished makes a significant difference for water systems. Simply measuring the amount of water a company uses and returns to its source each year, for example, does not account for when that water was used or returned. If most water is pumped during the summer and returned during the winter, these activities could still be disruptive to wildlife, ecosystems, and overall river flow rates.
“Unlike in sustainability efforts involving carbon offsets, there is no single atmosphere to improve. Every river has different needs at different times of the year,” says Ryan.
Implementation of corporate water goals requires detailed reporting and independent validation to ensure the efforts are sustaining or restoring and not damaging ecosystems.
“It’s a simple concept, becoming water neutral, but putting it in practice is not simple,” says Kiparsky. “A lot of the implications are going to rely on analysis by third parties that are experts in understanding water impact.”
This year, the U.S. Securities and Exchange Commission (SEC) began requiring most public companies to disclose climate-related information, including water-related financial risks, so investors can consider how companies are managing climate risks when making investment decisions. James says this is an important step that will help raise the bar with U.S. companies on water-related disclosures.
“As water risk continues to escalate, investors and companies need full transparency to be able to manage and adapt to these threats,” says James.
