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Preserving the Environment

A sustainable environment is a critical foundation to a strong company, country and economy. Preserving the environment is the right thing to do and makes business sense.

We provide customers a transportation option that is more fuel efficient and less carbon intensive than long-haul trucks, allowing businesses to ship freight in a more environmentally friendly manner. We are focused on improving processes, investing in technology and training employees to find the most innovative ways to better our business while protecting the environment for generations to come.

Photo taken near Walong, California

HIGHLIGHTS, CHALLENGES AND OPPORTUNITIES

Railroads are one of the most fuel efficient transportation modes. We measure fuel efficiency by the number of tons moved per mile on one gallon of diesel fuel. Fuel efficiency increases when trains move heavier shipments such as coal and steel, while it decreases with products that weigh less.

Union Pacific moved a ton of freight 456 miles on one gallon of diesel fuel. We experienced a 0.7 percent decrease in fuel efficiency in 2015 primarily driven by a decline in heavier, more fuel-efficient commodities. With an uncertain economy and demand outlook, we will continue to evaluate our locomotive fuel consumption goal as we adjust to changing market conditions.

Despite 2015 headwinds, we maintained our commitment to improve our environmental performance by investing in 100 Tier 4 locomotives, which reduce particulate matter emissions by as much as 91 percent and oxides of nitrogen emissions by as much as 90 percent, compared to locomotives built prior to EPA standards. We also added the first Generator-Set (Genset) switching locomotives certified to a Tier 4 standard to our locomotive fleet.

Union Pacific remains committed to fuel conservation and will continue seizing opportunities to engage employees, improve processes and leverage technology.

Greenhouse Gas Emissions

GOAL

Our goal is to reduce locomotive fuel consumption rate by 0.5 percent annually from 2015 to 2017, an adjustment from last year's 1 percent goal for the same timeframe. Measured on a gross ton basis, this will result in a greenhouse gas emissions reduction rate of 0.5 percent annually. With an uncertain economy and demand outlook, we will continue to evaluate our locomotive fuel consumption rate.

Union Pacific continues exploring opportunities to deploy technologies that save fuel and optimize train scheduling. Our senior leadership is focused on this objective, and its success is directly tied to compensation based on our performance review process.

Reducing our fuel consumption remains a corporate priority, and we strive to strike an appropriate balance between financial returns, environmental performance and social commitment.

PERFORMANCE

Union Pacific produced 11,683,549 metric tons of Greenhouse Gas emissions from fossil fuels in 2015, which is down from 2014, due primarily to a decrease in freight volume. Union Pacific's emissions from biomass sources were 129,600 metric tons, including 35,534 from renewable fuels.

Scope 3 emissions from employee travel totaled 19,803 metric tons. Employee travel includes rental car fuel and commercial air travel. We worked with suppliers to identify their Scope 3 emissions on behalf of Union Pacific. Suppliers representing an estimated 26 percent of our Scope 3 spend produced emissions totaling 266,746 metric tons in 2015, compared to 338,693 in 2014.

As part of the company's landfill diversion initiatives, we supply used wooden railroad cross ties as a fuel source in co-generation plants to produce electricity. We estimate that the consumption of 3.1 million ties resulted in 458,753 metric tons of greenhouse gas emissions.

Union Pacific's 2015 greenhouse gas inventory was verified by GHD. Union Pacific works with Trinity Consultants to compile our GHG inventory. GHD and Trinity Consultants are independent organizations.

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Building America Report 2015 - Environment Highlights
Building America Report 2015 - Environment Reducing Emissions

REDUCING CUSTOMERS' EMISSIONS

Union Pacific customers helped eliminate an estimated 32.9 million metric tons of greenhouse gases by choosing rail over truck transportation for their shipping needs.

Through our Carbon Emissions Estimator, our customers can calculate the carbon emissions reduced when they ship goods with us. We also send customers a savings estimate for their shipments.

Building America Report 2015 - Improving Fuel Efficiency

Jose Vences refuels a locomotive at the Santa Teresa Intermodal Facility

Improving Fuel Efficiency

As a railroad, we understand that fuel efficiency is a critical part of our approach to sustainability. Union Pacific employs a multi-disciplinary fuel conservation and emissions reduction team that meets regularly to focus on finding ways to reduce locomotives emissions. We understand this an environmental issue and a business issue, as diesel fuel accounts for about 15 percent of operating expenses.

In 2000, we could move a ton of freight 375 miles on one gallon of diesel fuel. By 2010, we were able to move it 495 miles. Our fuel efficiency has fluctuated over the past few years. In 2013, we declined to 471 miles per gallon, then saw an increase to 475 in 2014, followed by a reduction to 456 in 2015. While changing business conditions and commodity mixes presented challenges, multiple initiatives are creating baseline improvements.

ENERGY MANAGEMENT SYSTEMS

Locomotive engineers are trained to operate Energy Management Systems aboard locomotives. Use of these fuel conserving technologies has steadily increased in recent years.

  • LEADER (Locomotive Engineer Assist/Display and Event Recorder): Implemented in 2012, LEADER analyzes train operations through advanced GPS maps and provides throttle and brake prompts. More than 700 locomotives are now equipped with LEADER, up from 470 in 2014. In addition, 143 of these locomotives have an auto control for greater fuel efficiency. LEADER-equipped locomotives made 9.2 million trip miles in 2015.
  • Trip Optimizer (TO): TO automatically controls a locomotive's throttle to help keep trains on schedule while minimizing fuel use. This system calculates the most efficient way of operating a locomotive by considering factors such as train length, weight, route grade, track conditions, weather and locomotive performance. TO is now on more than 600 locomotives that made 9.8 million trip miles in 2015. This is an increase from 390 locomotives in 2014.
  • Smart Consist: This system provides the locomotive engineer requested horsepower and tractive effort for the locomotive consist by selecting throttle notch combinations for the best fuel economy. Smart Consist is on more than 300 locomotives, up from 210 in 2014.

EVALUATING ALTERNATIVE FUELS

Over the decades, Union Pacific has explored alternative fuels including bio-diesel, propane, liquefied natural gas (LNG) and hydrogen. As early as 1952, Union Pacific kicked off a project using gas turbine-electric locomotives.

We are continuing a multi-year evaluation of operating locomotives primarily with LNG, which may emit fewer emissions than diesel fuel. A Union Pacific employee leads the Association of American Railroads' task force evaluating LNG fuel tenders.

We plan to test LNG as a locomotive fuel source, one of many steps that will help determine if it is a commercially reliable and economical option. In preparation for the test, we have held meetings with community leaders, first responders and employees to discuss safety precautions along the test route. These efforts will continue until we complete the operation.

ENERGY MANAGEMENT SYSTEMS

Locomotive engineers are trained on operating Energy Management Systems aboard locomotives to help conserve fuel. Use of these technologies has steadily increased in recent years.

  • LEADER (Locomotive Engineer Assist/Display and Event Recorder): LEADER analyzes train operations through advanced GPS maps and provides throttle and brake prompts. Rolled out in late 2012, LEADER is now on more than 700 locomotives, up from 470 in 2014, 143 of which are equipped with auto control for greater fuel efficiency. These locomotives made 9.2 million trip miles in 2015.
  • Trip Optimizer (TO): TO automatically controls a locomotive’s throttle, which helps keep trains on schedule while minimizing fuel use. This system calculates the most efficient way of operating a locomotive by considering factors such as train length, weight, grade, track conditions, weather and locomotive performance. TO is now on more than 600 locomotives that made 9.8 million trip miles in 2015. This is an increase from 390 locomotives in 2014.
  • Smart Consist: This system provides the locomotive engineer requested horsepower and tractive effort for the locomotive consist by selecting throttle notch combinations for the best fuel economy. Smart Consist is on more than 300 locomotives, up from 210 in 2014.

EVALUATING ALTERNATIVE FUELS

Over the decades Union Pacific has explored alternative fuels including bio-diesel, propane, liquefied natural gas (LNG) and hydrogen. As early as 1952, Union Pacific kicked off a project using gas turbine-electric locomotives.

Union Pacific continues its multi-year evaluation of operating locomotives primarily with LNG, which may emit fewer emissions than diesel fuel. A Union Pacific employee leads an Association of American Railroads task force evaluating LNG fuel tenders.

We plan to test LNG as a locomotive fuel source in 2016, one of many steps that will help Union Pacific determine if LNG is a commercially reliable and economical option. Prior to testing, we will meet with community leaders and first responders to discuss safety precautions.

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Improving Operations

Union Pacific has invested about $8 billion since 2000 to purchase more than 4,300 locomotives that meet the Environmental Protection Agency's (EPA) Tier 0, Tier 1, Tier 2, Tier 3 or new Tier 4 standards, including 232 purchased in 2015 and 261 purchased in 2014. During this period, Union Pacific retired more than 3,000 older, less-efficient locomotives.

We have been working to revitalize rather than dispose of existing infrastructure. As part of this effort, Union Pacific has overhauled or rebuilt more than 6,400 diesel engines with emissions control upgrades.

Additionally, 96 percent of our locomotives are certified under existing EPA Tier 0, Tier 1, Tier 2, Tier 3 or Tier 4 emissions standards, which progressively add more stringent limits on engine air emissions. Our investments in new switching locomotives, which are designed to move trains or cars within a rail yard, also have helped improve fuel efficiency.

TIER 4 LOCOMOTIVES

Union Pacific researched and collaborated with locomotive manufacturers for years to prepare for the EPA's stringent Tier 4 emissions standards that took effect in 2015. We acquired 100 Tier 4 locomotives, which reduce particulate emissions from diesel locomotives by as much as 91 percent and oxides of nitrogen emissions by as much as 90 percent, compared to locomotives built prior to EPA standards. The Tier 4 locomotives began operating along the I-5 corridor in the western United States.

LOW-EMITTING GENSETS AT YARD CENTER

Union Pacific created and pioneered Generator-Set, or Genset, switching locomotives which are used to move trains inside rail yards. These ultra-low emitting locomotives are equipped with multiple smaller diesel engines and generators instead of one large single engine. Compared to conventional diesel locomotives, Gensets reduce greenhouse gas emissions by as much as 37 percent,  emissions of oxides of nitrogen by 80 percent and particulate matter by 90 percent.

A first set of 14 Genset locomotives certified to a Tier 4 standard was deployed to rail yard operations just south of Chicago thanks to a collaborative project that included the Illinois Department of Transportation, the Congestion Mitigation and Air Quality program and Union Pacific.

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Building America Report 2015 - Lower Emission Locomotives infographic

CLIMATE CHANGE DATA DISCLOSURE LEADER

Union Pacific achieved a CDP carbon disclosure score of 99 out of a possible 100 and remains among the top 10 percent of all companies in the S&P 500 sample, securing another position on the S&P Climate Disclosure Leadership Index. The company maintained its B rating in CDP's performance band, on an A to E scale.

In our seventh annual CDP disclosure, we highlighted how we are managing infrastructure, equipment and operations through innovation and training to increase fuel efficiency. We again shared responsible water management approaches through CDP's water questionnaire.

Detailing emissions and energy data in the CDP report, Union Pacific is committed to participating in global discourse on the most effective approaches to addressing climate change, while supporting a thriving economy. Our environmental sustainability initiatives reinforce how we adapt and innovate to safely meet the nation's dynamic freight transportation needs.

Addressing Climate Risk

Direct responsibility for Union Pacific's progress and status regarding climate change rests with our vice president of safety, security and environment/chief safety officer. This position reports directly to the board of directors at least annually regarding the implementation of the company's environmental policy, including activities related to climate change. In addition, the vice president of safety, security and environment/chief safety officer reports directly to the chairman, president and CEO regarding compliance with the company's environmental policy.

We are actively strengthening our railroad's ability to withstand future changes and events that might be associated with climate change, as well as increasing the overall resiliency of our system to deal with extreme weather events.

Temperature extremes can create harsh work environments for employees who work outside, increasing rail maintenance costs and impacting service by decreasing train velocity. Severe weather events, such as hurricanes, impact Union Pacific's network by causing slower train speeds, service interruptions and recovery costs. To mitigate these impacts, Union Pacific has established a variety of emergency response and resiliency plans that include strategically staging resources in affected regions prior to flooding, hurricanes or other major weather events.

Union Pacific educates the public and elected officials about how the rail industry's growth can mitigate some climate change impacts. We also work closely with public agencies to study and advance technology that will reduce train emissions. For instance, we strategically locate the newest, lowest-emitting locomotives in parts of the country with air quality challenges.

For additional information on how climate change could have a material adverse effect on our operational results, financial condition and liquidity, see the risk factors in our Annual Report on Form 10-K and CDP filings.

Environmental Management

We strive to maintain our leadership role in providing safe, reliable, fuel-efficient and environmentally responsible transportation for the goods that families and businesses need.

Our environmental management mission is:

  • Prevention: Prevent the causes of environmental damage that result from operations.
  • Preparedness: Align with internal and external customers to prepare for effective response and tomorrow's environmental issues.
  • Response: Respond to emergencies involving environmentally sensitive materials to minimize health, environmental, operational and financial impact.
  • Recovery: Restore the environment as a result of contamination for which Union Pacific is responsible.

Union Pacific's environmental management efforts begin with our environmental policy as signed by our chairman, president and CEO. The policy applies to all aspects of our operation including emissions, resource use and waste. It outlines three primary commitments each employee must make:

  • Pollution prevention
  • Regulatory compliance
  • Continuous improvement

These commitments ensure we align our environmental focus with our mission of service — working for the good of employees, customers, shareholders and the communities we serve and call home.

Our goal is to ensure we meet or exceed all applicable laws regulating our environmental impact. We use sophisticated systems and programs to track detailed metrics to ensure accurate reporting of our performance. Our Environmental Management Group, which oversees Union Pacific's compliance with environmental laws and regulations, is integrated into the company's daily operations, and ensures that environmental best practices are followed through rigorous planning, coordination and communication, as well as employees' hands-on involvement and awareness.

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CONSERVING ENERGY

Our Utility Management Team completed more than 30 utility conservation projects in 2015, reducing energy consumption by nearly 5 million kilowatt hours, or the equivalent of the amount of energy consumed by more than 400 U.S. homes annually.

ENERGY CONSUMPTION* 2013 2014 2015
Diesel 1,103.5 gallons 1,171.2 gallons 1,071.3 gallons
Gasoline 12.9 gallons 12.7 gallons 11.9 gallons
Other fuel 13.8 gallons 13.6 gallons 17.7 gallons
Electricity 652.9 kilowatt hours 627.1 kilowatt hours 669.4 kilowatt hours
Natural gas 761.8 standard cubic feet 720.4 standard cubic feet 1,145.5 standard cubic feet

*Estimated in millions

Eco-Treasure Hunt Reveals Energy Savings

Employees used continuous improvement techniques and sought outside perspectives to find energy conservation and utility cost-saving opportunities at a locomotive shop in North Little Rock, Arkansas.

General Electric and an energy consultant joined our employees for a multi-day "Eco-Treasure Hunt." The effort led to multiple energy-saving pilots, including use of LED lighting at three locations. Participants installed timers on boilers and parts washers to shut them down during non-operating hours. They also created standard processes for turning off paint booth equipment on weekends. Our team is exploring how to standardize and roll out similar initiatives at other facilities.

Building America Report 2015 - Eco-Treasure Hunt

"Eco-Treasure Hunt" participants use continuous improvement techniques to find energy saving opportunities at the Jenks Locomotive Shop.

Collaboration for Conservation

In an effort to identify ways to conserve energy across Union Pacific's system, a team of employees was asked to develop energy-saving solutions for Union Pacific's 600-plus air compressors.

Air compressors are responsible for about 20 percent of Union Pacific's electricity consumption. They support critical functions including air brake tests, yard operations and waste water treatment pumps.

The team approached the multi-year project using the company's UP Way process, which challenges employees to standardize work, solve problems and eliminate variability and waste. Employees sought uniform approaches to making compressor operations more productive. This resulted in replacing older air compressors with a more efficient air compressor system.

Repair facilities in Salt Lake City experienced more than 80 percent in efficiency gains with the new compressors which shut off when not in use, while their predecessors ran 24/7. Companywide, the new systems are up to 90 percent more energy efficient. The new design also requires less maintenance, increases equipment life and can be relocated to support operational changes.

Building America Report 2015 - Collaboration for Conservation

A new air compressor system reduces electricity and is 90 percent more energy efficient than air compressors used prior to installation.

Santa Teresa Intermodal Ramp Goes Gold

Our Santa Teresa Intermodal Ramp building projects earned the prestigious LEED (Leadership in Energy and Environmental Design) Gold Certification. Recognizing best-in-class building strategies and practices, LEED is a sustainable building certification program developed by the U.S. Green Building Council.

Energy efficiency is built into the 13,600-square-foot yard office structure, which contains offices, a train crew workspace and locker room facilities. It also includes a photovoltaic system: 240-volt solar panels capable of providing 40 percent of the building's power requirements. This system will save more than $15,000 annually. Sheltering management and support staff, the 7,667-square-foot gatehouse also has a photovoltaic system. Its 240-volt solar panels provide nearly 40 percent of the building's power requirements.

Through the LEED certification, these buildings' innovations are recognized as outstanding in energy conservation, occupant health and well-being, and low environmental impact. Our Omaha, Nebraska, headquarters building achieved LEED Silver certification in 2012.

Building America Report 2015 - Eco-Treasure Hunt

The Santa Teresa Yard Office is equipped with solar panels capable of providing 40 percent of the building's power requirements.

Energy Savings Uncovered During Data Center Projects

Union Pacific's data centers manage critical information used to operate our systems. They also consume as much as 30 percent of a building's energy load.

A project to improve redundancy, eliminate points of failure and increase capacity at our headquarters data center reaped energy efficiencies while reinforcing the center's reliability. New upgrades include:

  • Six cold aisle containment systems to improve cooling efficiency. Cold aisle containment systems deliver cool 70-degree air directly to the point of use as opposed to cooling the entire data center to a lower temperature.
  • Eight computer room air handling units with variable speed fans. The new units are capable of delivering more cool air with less fan energy. They eliminate the need to run additional units merely to pressurize a space under the floor.
  • LED lighting in all cold aisle containment areas. The LED bulbs decrease lighting energy consumption from 28 to 16 watts per bulb.
  • Sixty-one occupancy sensors that turn lights off when an area is unoccupied.

Collaborative Opportunities

CYCLING AT UNION PACIFIC

We worked with Heartland BCycle to install a bike sharing station outside of our headquarters building, making it easier for people to select a low-carbon travel option. Heartland BCycle is the first largescale bike sharing system in Omaha, Nebraska, with more than 30 stations strategically located throughout the metro area.

Union Pacific also competed in the National Bike Challenge, an event to encourage 50,000 riders to pedal 30 million miles. More than 50 bike stalls are available at Union Pacific Center, and typically full from early spring to late fall.

GREENBIZ EXECUTIVE NETWORK

Union Pacific joined the GreenBiz Executive Network (GBEN). GBEN is a membership-based peer-to-peer learning forum for sustainability executives from the world's largest companies. Its unique combination of expertly facilitated meetings and resource sharing enables members to benefit from the insights of their peers across a range of topics and sectors.

GLOBAL ENVIRONMENTAL MANAGEMENT INITIATIVE (GEMI)

Union Pacific has participated in the Global Environmental Management Initiative (GEMI) since 2010. GEMI brings together companies from diverse industries to solve environmental problems and provide tools for the public's use. Our company continued to provide input and business cases for GEMI's Quick Guide series, which provides a closer look into the methods corporations use to address sustainability topics.

CALIFORNIA AIR RESOURCES BOARD AND CALIFORNIA AIR DISTRICTS

Union Pacific continues to work with the California Air Resources Board (CARB) and California's regulatory air districts to reduce emissions and improve air quality. Our collaboration with CARB began in the mid-1990s through a first-of-its-kind commitment to bring the most advanced and environmentally friendly locomotive technology to the South Coast Air Basin by 2010, with a continuing commitment through 2030.

Union Pacific facilitates discussion to broaden awareness as CARB and other relevant entities consider future steps. In 2015, CARB and Union Pacific hosted two annual inspections of rail yards throughout California. Video footage was taken during the fall inspection to communicate our collaborative efforts.

CALIFORNIA COUNCIL FOR ENVIRONMENTAL AND ECONOMIC BALANCE

The California Council for Environmental and Economic Balance (CCEEB) has worked since 1973 to solve the most pressing environmental policy problems facing California. CCEEB is a nonprofit, non-partisan coalition of industry, labor and public leaders dedicated to making environmental and economic balance a reality. Union Pacific has been a member and has had an employee serving on CCEEB's board since 1992.

WILDLIFE HABITAT COUNCIL

Union Pacific became a member of the Wildlife Habitat Council (WHC) in 2015. WHC promotes and certifies habitat conservation and management on corporate lands through partnerships and education. WHC programs translate corporate sustainability goals and objectives into tangible and measurable on-the-ground actions. Through a focus on building collaboration for conservation with corporate employees, other conservation organizations, government agencies and community members, WHC programs focus on healthy ecosystems and connected communities. WHC is providing expertise to promote pollinator habitat development.

ASSOCIATION OF AMERICAN RAILROADS

Union Pacific has teamed with other railroads to form a Sustainability Task Force through the Association of American Railroads. The task force establishes a forum for railroads to share best practices related to industry sustainability. We also co-sponsored the Railroad Sustainability Symposium.

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CONSERVATION SCHOLARSHIPS

In conjunction with our Earth Day observances, Union Pacific offered four scholarships worth $500 each to high school students undertaking conservation projects in their communities. The winners' projects included planting trees to restore a city park damaged by a storm, installing a water bottle filling station and water recycling for garden boxes at a high school, creating a map updating trail markers at a nearby state park, and refurbishing a school's learning garden.

One winner, Austin Feller from Shenandoah, Iowa, planted four large cottonwood trees near the Wabash Trace Nature Trail in western Iowa. He strategically planted the trees in locations where they would prevent a stream from reaching the trail's path. The trail sits on a key route once operated by the Wabash Railroad, which connected farmlands, factories and passengers starting in the 19th century.

Building America Report 2015 - Austin Feller, conservation scholarship winner

Austin Feller, conservation scholarship winner

Waste Management

Our approach to responsible material management is expanding as we identify opportunities to more efficiently use materials and divert waste from landfills, minimizing our environmental impact and resource loss.

We estimate that we generated about 1.04 million tons of waste in 2015. We diverted 707,000 tons, an estimated 68 percent of our waste, from landfills.

Employees' perspectives are a significant catalyst for improvements in our waste management and environmental citizenship. In 2008, we formally began encouraging employees to suggest environmental sustainability tips and ideas. We have since received more than 3,600 ideas from 2,200 people. Over 40 percent of these suggestions led to changes in our programs and processes.

OUR EFFORTS

We are taking action on many fronts to reduce our environmental impact. Process changes have decreased our federal large-quantity hazardous waste generator sites from 35 to two. We recycle at the vast majority of employee locations and our Environmental Management Group routinely works with employees across the system to comply with waste disposal regulations.

  • E-Waste: Union Pacific recycles electronics that have reached the end of their useful life, commonly known as e-waste. The company recycled or distributed more than 270,000 pounds of electronic equipment and more than 1.3 million pounds of signal batteries.
  • Fuel and Oil: We recycled more than 4.2 million gallons of oil and fuel. Our equipment and maintenance processes capture used oil and fuel at our facilities for recycling. In addition, drip pans and other collection systems are placed under engines to catch spills, separators extract engine oil from wastewater and fuel nozzles shut off automatically to prevent overflow.
  • Headquarters Dining Room Waste: Thousands of employees and guests enjoy breakfast and lunch at the Union Pacific Center's dining room during the work week. Several initiatives emphasize the importance of using ceramic dinnerware provided in the dining room instead of disposable products intended for take-out. We reduced consumption of disposable products by 12 percent by placing reusable items in strategic locations and offering reusable cup incentives.
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Water

As a steward of the environment and in accordance with our environmental policy, Union Pacific strives to conserve America's resources, including water. We estimate that we used 1.54 billion gallons of water in 2015.

For the second time, the company participated in CDP's water questionnaire, outlining efforts to responsibly manage water. Our risk assessments are primarily qualitative and include but are not limited to weather response plans, regulatory and environmental impact risk mitigation strategies, and water infrastructure investment strategies. The company's role in water management stretches back to our beginnings, as we frequently were the first land developer across the western United States. To this day, Union Pacific is responsible for providing safe drinking water to the public in a handful of locations.

Union Pacific has thousands of water utility accounts across our 32,000-mile network. We continue efforts to conserve and reduce water use at our facilities.

Protecting water also is important. We have spill prevention control and countermeasure plans at more than 130 Union Pacific facilities. We also operate and maintain 89 wastewater treatment facilities that capture wastewater created during equipment washing, locomotive fueling and maintenance, intermodal crane and truck maintenance, track and roadway equipment shop maintenance, and storm water accumulation at shop facilities. To ensure it meets acceptable cleanliness levels, captured wastewater undergoes treatment that requires stringent compliance with governmental regulations and wastewater discharge permits.

Stewards of the Land

Union Pacific balances its commitment to transporting goods efficiently with its impact on communities, wildlife and the environment. Ensuring the preservation and resiliency of the land on which we operate helps us as a business and is a priority for the company.

Rail operations can contribute to land and water contamination. Union Pacific actively works to prevent contamination by employing best practices in operations, overseeing lease tenants and proactively working with customers. We also restore land contaminated by prior rail operations. In some cases, Union Pacific works with regulators to go beyond minimum remediation requirements to further protect the land and waterways.

Among other efforts, we work with tenants to improve environmental conditions of lease sites, address land impacts as part of our preparedness initiatives and incorporate soil reuse criteria into construction projects.

SACRAMENTO RAIL YARD CLEANUP CLEARS WAY FOR ECONOMIC REVITALIZATION

The Sacramento Rail Yard (Sac Yard) sits prominently on a 240-acre section of land just north of downtown Sacramento, California. The location that once served as the terminus for the Transcontinental Railroad now stands as a symbol of one of the country's most successful EPA brownfield remediation projects. It also represents a tremendous economic revitalization opportunity for the core of California's capitol city.

Sac Yard has been used as a locomotive maintenance facility since being founded by Central Pacific Railroad in 1863 and operated by Southern Pacific and Union Pacific in following years.

In the 1860s, the land was a swampy lake. Central Pacific was given the property under the condition that it fill the swamp. Materials used to do so, per standard practices of the time, contributed to the enormity of the remediation work.

Union Pacific took the following approach to cleaning and revitalizing the area:

  • Investigate: We began by collecting soil and water samples.
  • Evaluate results and determine cleaning approach: In accordance with multiple laws and regulations, we decided to divide and conquer, splitting the yard into 30- to 40-acre subunits called "study areas."
  • Start Cleaning: Through the process, we discovered groundwater contamination. To address the discovery, we built a 70-foot wall around the contaminated water. Then we installed ground water wells to pump the water out. Like putting a straw in a glass, this system allowed us to remove the solvents successfully.

The Sac Yard redevelopment is expected to include a hospital, Major League Soccer stadium and homes. Sacramento residents hope to see construction begin as early as 2018.

Building America Report 2015 - Sacramento Yard development

The 19th century brick buildings, originally called the Central Shops, will be incorporated into future Sacramento Yard development.

Compliance

Union Pacific is committed to following applicable laws and regulations in all areas of our operations. From time to time, we are involved in legal proceedings, claims and litigation that occur in connection with our business. For example, we received notices from the EPA and state environmental agencies alleging that we are or may be liable under federal or state environmental laws for remediation costs at various sites throughout the United States, including sites on the Superfund National Priorities List or state superfund lists. We cannot predict the ultimate impact of these proceedings and suits because of the number of potentially responsible parties involved, the degree of contamination by various wastes, the scarcity and quality of volumetric data related to many of the sites, and the speculative nature of remediation costs. Where we are found in violation of specific rules or regulations, we seek remedy through the appropriate channels.