Eco-design IVTools and Strategies for Sustainable Consumption and Production

ContentsOverall strategies and conceptsTools2.1. Business perspective 2.2. Analytical tools2.3. Procedural tools2.4. Communication tools2.5. Product sustainability toolbox3. Policies and Instruments

1. Overall strategies and conceptsof sustainable production and consumption

Goal: Sustainable Development- the three pillars SustainabilitySocialEnvironmentEconomy

Sustainable Consumption and Production:10-year Framework of ProgrammesIdentify activities, tools, policies, monitoring and assessment mechanisms, including, where appropriate scientific methods such as life-cycle analysisDevelop production and consumption policies to improve the products and servicesDevelop awareness-raising programsDevelop and adopt, on a voluntary basis, , consumer information tools ... UN guidelines on consumer protection...

Policy principlesContinuous improvementTransparencyEco-efficiencyPrecautionLife cycle thinkingPolluter paysCommon but differentiated responsibilities

Overall StrategiesDematerializationLife Cycle ManagementProduct Service SystemsThe Triple Bottom Line ConceptInvestment and insuranceCorporate responsibilityReportingEducation and training

Dematerialization Addressing needs and functionality rather than the product aloneTracking throughput of materials and energy in industrial and consumption processesMajor increase in resource productivity

Life Cycle Management Life cycle thinking provides a holistic framework taking the entire system of a product, process or service into account, enabling us to make realistic choices for the longer term taking multiple factors into account. Life cycle thinking needs tools to make it practical to regular activities and decisions.

Life Cycle Management (cont.)Life Cycle Management (LCM) is an integrated concept for managing the total life cycle of goods and services towards more sustainable production and consumption. uses various procedural and analytical tools taken from the Product Sustainability Toolboxdifferent applications and integrates economic, social and environmental aspects into an institutional context.

Product Service SystemsProduct Service Systems (PSS): strategy to develop a marketable mix of products and services that are jointly capable of fulfilling a client's need - with less environmental impact. - a need rather than a product- win-win solutions - de-coupling economic growth and environmental degradation.

Product Service Systems: Definition A Product-Service System can be defined as the result of an innovation strategy, shifting the business focus from designing and selling physical products only, to selling a system of products and services which are jointly capable of fulfilling specific client demands.UNEP (2002)

Product Service Systems:Three main approachesServices providing added value to the product life cycleServices providing final results for customersServices providing enabling platforms for customers

The Triple Bottom Line ConceptEconomyEnvironmentSocietySustainable DevelopmentThree Pillars of Sustainable Development

The Triple Bottom Line Concept

The Triple Bottom Line Concept

TBL In Society Accepted concept Incorporated in law TBL assessments widely used Business reporting tool Expands decision-making scope Significant advancement over previous assessment tools

2. Tools for sustainable production and consumption2.1. Business perspective2.2. Analytical tools2.3. Procedural tools2.4. Communication tools2.5. Toolbox

2.1. Business perspectivein SCP

Business GoalsCompanies can act in two very different ways to Societys demand for sustainable development:Reactive: Fulfilling existing laws, directives and perhaps standardsProactive: Go beyond existing regulation to become leader and use sustainability aspects as business opportunities

Companies Potential Areas of ImprovementProcesses: Eco-efficiency, Total Quality Management, CPA, EnTA, environmental risk assessment.Products/ Services: Dematerialization, LCA, PSS, Eco-design, Function Based Approach.Consumer communication: Consumer opportunities, Advertising and Marketing, Eco-labels.Systems: Life Cycle Management, Material Flow Accounting, Environmental Management Systems, Multi-stakeholder dialogues, supply chain management.

2.2. Analytical tools in SCP

Three types of analytical tools for eco-design:A. Quantitative tools such as LCA B. Matrices C. Checklists

List of analytical toolsLife Cycle Assessment (LCA)Material Input per Unit of Service (MIPS)Environmental Risk Assessment (ERA)Material Flow Accounting (MFA)Cumulative Energy Requirements Analysis (CERA)Environmental Input-Output Analysis (env, IOA)Life Cycle Costing (LCC)Total cost accounting (TCA)Cost-Benefit Analysis (CBA) MatricesChecklists

Predicted Exposure ConcentrationPrediction of emission rateEXPOSURE ASSESSMENTExtrapolationDose-response testsHAZARD IDENTIFICATION- Risk Characterisation- Uncertainty AnalysisEFFECT ASSESSMENTExposure predictionPredicted No-Effect ConcentrationAcceptable Daily IntakePredicted Exposure DoseEnvironmental Risk Assessment (ERA)EnvironmentEnvironmentHuman Health

ERA stepsHazard identification relationship between different levels of exposure and effectsEffect assessmentExposure assessment

FIGURE 15.6 Steps in a risk assessment.Choice of more exhaustive examination

Life Cycle AssessmentLife Cycle Assessment (LCA) is a tool for the systematic evaluation of the environmental aspects of a product or service system through all stages of its life cycle. provides an adequate instrument for environmental decision support. reliable LCA performance is crucial to achieve a life-cycle economy. The International Organisation for Standardisation (ISO), has standardised this framework within the series ISO 14040 on LCA.

Life Cycle assessmentFrom cradle to graveImpacts on Human healthEcosystemsResources

ISO 14040 Life Cycle Assessment, Principles and frameworkLife cycle assessment framework Goaland scopedefinitionInventoryanalysisImpactassessmentInter-pretationDirect applications:- Product development and improvement- Strategic planning- Public policy making- Marketing- Other

According to ISO 14040:Life Cycle Assessment Structure

Recycling/ Waste ManagementLife Cycle Assessment:Inventory AnalysisAcquisition of raw materialProductionUse/ reuse/ maintenance

Steps of the inventory phase

Example of a product system, production and use of steel sheet metal, for life cycle inventory analysis.2. Mining of iron ore1. Mining of coal3. Mining of limestone4. Crushing grinding6. Sintering5. Transport7. Blast furnace8. Steel furnace9. Steel moulding10. Transport11. Cutting, shaping13. Waste handling12. Use14. Landfill15. Production of electricitySystem boundaryProduct systemEnvironment Elementary flows

Life Cycle Assessment:Impact Assessment

Elements of the life cycle impact assessment procedure.

Elements of the interpretation phase of an LCA study.

LCA-result:Environmental impact / functional unitAmount of nitrate in water/ produced amount of meatExample:

Types of environmental interventions in LCAExtraction of abiotic resourcesExtraction of biotic resourcesLand useClimate changeStratospheric ozone depletionPhoto-oxidant creationHuman toxicityEco-toxicityAcidificationNutrification

Strengths of LCAComprehensive with respect to environmental impact connected to a functionAvoids problem shiftingExplicit distinction between science based information and value choicesInternational standardisation by ISOBest practice identification envisaged in SETAC-UNEP programme

Weaknesses of LCAToo complexToo data intensiveDoes not directly consider future changes in technology and demandDoes not consider societal effectsOnly known and quantifyable environmental effects are consideredRequires expert knowledge

Life Cycle Costing (LCC)Looks at the complete life-span of a product to calculate the entire life cycle costs, which include all internal costs plus external costs (=externalities) incurred through throughout the entire life cycle of a product, process or activityPuts a monetary value on the emissions and resource use (unfortumately, no valuation method has been generally agreed)

Total Cost Accounting (TCA)Describes the long-term, comprehensive analysis of the full range of internal costs and savings resulting from pollution prevention and other environmental projects undertaken by a firmComprehensive costs and savings inventoryPrecise cost allocationUse of long time horizonsUse of profitability indicators which account for the time value of moneyDoes not consider eco-efficiency

Cost-Benefit Analysis (CBA) Determines whether or not the benefits of an investment or a policy outweigh its costsVery broad scopeAll costs and benefits are expressed in monetary valuesLarge uncertainty because of many valuations

CBA in energy and transport sectors

Steps in the analysisTools, dataStep1. Emissions. Environmental burdensTechnology characterisationLife Cycle InventoryStep 2. Impacts. Dispersion. Exposure. Impacts.Dispersion models: local, national, regional, globalExposure response functions: public health, man-made environment (agriculture, materials), natural environmentCritical loadsReseptor at risk dataStep 3. DamagesMarket pricesWillingness to Pay - studies

Eco-costs/Value ratio componentsassemblydistributionmarketingretail

Eco-costsThe costs to prevent polluting emissions (to the air, water and ground), during the life cycle, at a sustainable level of earths carrying capacityThe eco-costs of materials, taking into account the ratio of recyclingThe cost of energy at the price level of sustainable energyThe eco-costs related to the costs of labourThe depreciation of the eco-costs of production facilities

Cost-effectiveness Analysis (CEA)Derivation of CBADetermines the least cost option of attaining a predefined targetBenefits are not expressed in monetary terms

Function-based approach (FBA)Human needs should be met by products and services that are aimed at specific functions such as food, shelter and mobility, and that are provided through optimized consumption and production systems that do not exceed the capacity of the ecosystem.Life Cycle Initiative Brochure, UNEP / SETAC, International Partnership, 2003.

Function Based Approach: ExampleNeed area or functionShelterFoodMobilityPersonal careLeisureClothingEducationTotalDirect and indirect energy use per person*39%18%18%9%8%6%2%100%*Average for Groningen/ the Netherlands as reported by Tukker (2003)

Material Flow AccountingMaterial Flow Accounting (MFA) refers to accounting in physical units (usually in tons); the life cycle of materials in a given location (i.e., substances, raw materials, products, wastes). Examples of flow accountings are:Eco-toxic substances that may cause environmental problemsNutrients such as nitrogen and phosphates due to their critical influence over eutrophicationAluminium, the economic use, recycling and reuse of which are to be improved

Ecological Rucksack and MIPSEcological Rucksack: The total weight of material flow carried by an item if consumption in the course of its life cycle.MIPS (Materials Intensity per service unit): An indicator based on the material flow and the number of services provided.Reducing MIPS is equivalent to increasing resource productivity

Ecological Rucksack Diagram

Some other ecological rucksacks

Plastic or Cotton Bag?

Factor 4 and Factor 10Factor 4: the idea that resource productivity should be quadrupled so that wealth is doubled and resource use is cut in half. Doing more with less. Result: substantial macroeconomic gains.Factor 10: per capita materials flows in OECD countries should be cut by a factor of ten. Requirement to be able to live sustainably in the next 25-50 years.Note: technology for Factor 4 already exists!!

Factor x: Going beyond Factor 4 and Factor 10

Material Flow Accounting (MFA) - approachesSpecifies pathways of materials in, out and through the economy of a nation, a region, a community, business sector, company or householdTwo approaches:The flow of bulk materials industrial metabolism (b-MFA = bulk Material Flow AnalysisThe flows of a single substance or a group of substances (SFA = Substance Flow Analysis

MFA main characteristicsLimited by a given region or a given period in timeCradle-to-grave approachWorks well for a number of policy questions

MFA - applicationsThe bookkeeping of bulk materials and substance flows: monitoring, accounting, inventoriesModelling of bulk material flows and stocks to assess the origins of pollution, the fate of certain inflows, future trends in flows and stocks

Cumulative Energy Requirements Analysis (CERA) CERA states the entire demand valued as primary energy which arises in connection with the production, use and disposal of an economic good (product or service)Limited formal recognition documentation only in Germany

Model of CERACERA = CERAp + CERAu + CERAd

CERA cumulative energy requirements of the economical goodCERAp - cumulative energy requirements for the productionCERAu - cumulative energy requirements for the useCERAd - cumulative energy requirements for the disposal

Issues in CERARelated materials expendituresSelection of materials and process technology with respect to energy criteriaRelevance of the treatment of used goods through energetic exploitation and disposal, recycling of parts, components and materials under energy aspectsThe influence of the service life of energy consuming or energy converting economic goods under energy aspectsThe emissions related to energy conversions during production, use and disposal

Environmental Input-Output Analysis (env. IOA)IOA: Wassily Leontief 1930s, focusing on industrial tradesEnv. IOA: extension of IOA to consider pollution generation and abatement activitiesRequires very detailed data

Categories of env. IOAGeneralised Input-Output Models: technical coefficients matrix reflecting also pollution generation and abatement activitiesEconomic-Ecological Models: extension of the inter-industry framework to include ecosystem sectorsCommodity-by-Industry Models: environmental factors are expressed as commodities tarbed in a commodity-by-industry input-output table

2.3. Procedural toolsEnvironmental Management SystemsEnvironmental AuditEco-design Supply chain managementEnvironmental AuditEnvironmental Performance Review (E P R)Environmental Impact Assessment (EIA)Total Quality Environmental Management (TQEM)

Environmental Management SystemsAn environmental management system (EMS) is a means of ensuring effective implementation of an EM plan or procedures in compliance with environmental policy objectives.A key feature on any effective EMS is the preparation of documented system procedures and to ensure effective communication and continuity of implementation.There are certification systems for EMS as the ISO 14001 and EC EMAS scheme.Ongoing development towards product-orientated management systems (POEMS).

Environmental Management System: principlesHow can an organisation formulate an environmental policy and objectives, considering legislative requirements and information about significant environmental impacts?Continual environmental improvement of the organisationISO 14001

Environmental Management System: stepsEnvironmental policyManagement reviewChecking and corrective actionsPlanningImplementation and operation

Eco-design (= Life Cycle Design)Integration of environemtal aspects into the familiar product development processStep-by.step plan that goes through all stages (7 steps) in product developmentWin-win situation: benefits for both business and the environmentPromoted by UNEP, 1997

Eco-designLooks at the relation between a product and the environment. Some common propositions about eco-design or Design for Environment (DfE) include: captures the environmental impacts of the whole production-consumption chain; 60% to 80% of life-cycle impacts from products are determined at the design stage; DfE is to develop generic, company and product independent standards (under ISO TC207) way to engage business interest and action because it focuses on the products' market vulnerability.

To introduce the environmental parameter into the design of products, processes and/or activities in an effective manner

The environmental parameter becomes a business opportunity! Eco-design: Key message

Eco-design: Changes in the product development procedureAdjustment of the requirements (specifications) of the product, process or activityRealisation of corresponding LCA or other analysis tools to identify weak pointsDevelopment of Eco-design guidebook

Category 1: Highly recommended to carry out in short term.Category 2: Can be incorporated: the more the better.Category 3: Need further improvements.Category 4: Will be sorted out.Technical and Economic feasibilityEnvironmental Advantages++--Category 3:Environmental benefitsTechnical and economic problemsCategory 4:Few environmental improvementsTechnical and economic problemsCategory 2:Few environmental improvementsTechnical and economic feasibilityCategory 1:Environmental benefitsTechnical and economic feasibility Eco-design: Prioritisation Matrix

Eco-design: Example 1 - Humidity catchers

Eco-design: Example 2 Clothes from recycled material

Environmental auditChecking of the Environmental Management SystemsISO 14.010 sets out the principles and rules for an internal and external auditing of EMS

Environmental Performance EvaluationProvides guidelines for the choice, monitoring and control of environmental indicators representing the performance of a companySupports internal decision makingThree indicator categories: (1) environmental condition indicators, (2) operational performance indicators, (3) managements performance indicators

Supply chain managementCompanies as customers can influence their suppliers to respect certain sustainability requirements with regard to the product they procure.Greening the supply chain.

Environmental Impact AssessmentEvaluation of effects related to a specific projectLocation-specificComparison of alternativesThree types: (1) strategic EIAs, (2) project EIAs, (3) location EIAs

Total Quality Environmental Management (TQEM)Expansion of TQM programmesFour basic elements:Customer Identification environmental quality is determined by customer preferencesContinuous Improvement involves all employeesDoing the job right the first time prevention of environmental risksTaking a System approach to design all components so that they function together, and support each other in achieving desired goals

2.4. Communication toolsConsumer Communication and MarketingEco-labellingMulti-stakeholder dialogue

Consumer CommunicationOpportunities for the consumer to make a change:Conscious purchasingConsumers power (voting with the pocket, activism)Waste separation, water, energy, etc.Buy eco-efficient products (saving)Quality of life versus consumerismSustainable life stylesCrucial role of retail sector

Eco-labellingType I (ISO 14024) - third party certification labels: claims are based on criteria set by a third part. Examples include the EC Eco-Label, Nordic Swan and the German Blue Angel; Type II (ISO 14021) self certified labels claims are based on specific declarations by manufacturers or retailers. Numerous examples e.g. made from X% recycled material; Type III (ISO /TR 1425) Environmental Product Declarations or LCA based labels are claims consist of quantified products information base on life cycle impacts. Single issue labelling schemes such as the private Forest Stewardship Council (FSC) and organic food labels do not fall within any of the categories but are partially converted by ISO 14020 General Guidelines for Environmental Claims and Declarations.

Eco-labelling: Examples

Multi-stakeholder dialogue Changes of the supply chain need often multi-stakeholder dialogue to allow that several players act together with the same aim.

Voluntary agreementsCommitments undertaken by firms or by industrial organisations to deal with environmental problemsThe agreements are made with or recognised by public authorities

2.5. Product Sustainability ToolboxDataToolsApplicationsChange

Product Sustainability ToolboxApplicationsMaterial, Process and Product Comparison Investment Decision SupportStrategic PlanningMarketing, Customer and Regulatory ComplianceWeak Point AnalysisBenchmarking

Product Sustainability ToolboxToolsERA, LCA, MFA, FBA Eco-design/ DfEEco-labelling: Type I, II, IIISupply Chain ManagementMulti-stakeholder dialogueConsumer Communicationand more...

3. Policies and instrumentsIntegrated Product PolicySustainable ProcurementPolicy instruments to encourage SCP

Traditional life cycle view of policyResource Inputs Use/ ConsumptionEnd of life/ disposalProductionTraditional focus of governments Traditional focus of governmentsMaximise efficiencyMinimise waste

Integrated Product Policy (IPP)Life-Cycle Thinking cumulative environmental impacts - from the cradle to the grave. Working with the market setting incentives so that the market moves in a more sustainable direction by encouraging the supply and demand of greener products. Stakeholder Involvement it aims to encourage all those who come into contact with the productContinuous Improvement improvements can often be made to decrease a products environmental impacts A Variety of Policy Instruments the IPP approach requires a number of different instruments because there are such a variety of products and different stakeholders.

Sustainable Procurement Sustainable procurement is the process in which organisations buy supplies or services by taking into account:the best value for money considerations such as, price, quality, availability, functionality, etc.; environmental aspects ("green procurement": the effects on the environment that the product and/or service has over its whole lifecycle, from cradle to the crave); the entire Life Cycle of products;social aspects: effects on issues such as poverty eradication, international equity in the distribution of resources, labour conditions, human rights.

Policy instrumentsto encourage SCPRegulatory: standards, norms, EPR (environmental performance reviews), labelling, (enforcement)Economic instruments: taxes, subsidies,credits, financial incentives, etc.Social: awareness raising, education, information, voluntary initiativesOthers: indicators, green accounting...

Policies and Instruments for SCP*Source: OECD, 2002.

**LCM is applicable for industrial and other organisations demanding a system-oriented platform for implementation of a preventive and sustainability driven management approach for product and service systems. It may serve as guiding principle for product oriented policy making and general policy frameworks such as Integrated Product Policy (IPP) and Extended Product Responsibility (EPR).

*A PS systems has the potential to remove the link between economic growth and environmental impacts by decoupling wealth creation from the need to use more and more natural resources and energy and its resulting pollution effects******