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INTRODUCTION TO

CLEANER PRODUCTION (CP)


CONCEPTS AND PRACTICE
Prepared by the Institute of
Environmental Engineering
(APINI) Kaunas University of
Technology, Lithuania

For UNEP, Division of


Technology, Industry, and
Economics

Contents
1. How did environmental strategies evolve?
2. What is CP?
3. How CP is applied in practice:
CP practices
Benefits and barriers
Procedures

4. What is CP contribution to main stakeholders?


Governments
Financial institutions

Course Objective
At the completion of this course the participants
will have understanding of :
-

Evolution of environmental strategies, concept


of sustainable development

Basic concepts of preventive environmental


approaches

Methodology of CP implementation in industrial


enterprises

How to develop and implement CP project


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Passive environmental
strategies
Dilute & disperse

Reactive environmental
strategies
end-of-pipe approaches

Reactive environmental
strategies
On - site recycling

Proactive environmental
strategies:
Cleaner Production
Prevention of Waste
generation:
- Good housekeeping

- Input substitution
- Better process control
- Equipment modification
- Technology change
- On-site recovery/reuse
- Production of a useful byproduct
- Product modification

What is waste?
There are literally hundreds words for
different types of waste:
allowance

greenhouse loss

BOD
broke
contaminated
solids
core loss
customer returns
damage
draining
dust
effluent
evaporation
furnace loss

hidden losses
leakage
non-conforming material
overfill
packaging
process loss
rework
second quality
stock loss
washings
and etc.
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!!!
Waste is waste what
ever you call it : take
the opportunity to cut
waste and increase
profits!

Cleaner Production Financing


The Cost of Waste Iceberg

THE HIDDEN COST


OF WASTE

Adapted from: Bierma, TJ., F.L. Waterstaraat, and J. Ostrosky. 1998. Chapter 13: Shared Savings and
Environmental Management Accounting, from The Green Bottom Line. Greenleaf Publishing:England.

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Where are you now?


Only a change
in technology
would eliminate
waste
completely
We are
optimising our
processes and
achieving big
cost reductions
Waste is
coming down as
we change the
way we work

We have
identified our
waste and
monitoring it
We plan to
reduce waste
Waste is cost
and regulatory
issue
Waste is only
disposal issue
Waste is not an
issue
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Cleaner Production Definition


The continuous application of an integrated
preventive environmental strategy applied to
processes, products, and services to increase
overall efficiency and reduce risks to humans
and the environment.

(United Nations Environment Programme)

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Cleaner Production Definition


Continuous Products

Preventive

Integrated

Processes

STRATEGY for

Services

Humans

Risk Reduction

Environment

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Properly implemented CP :
always

reduces long-term liabilities which


companies can face many years
after pollution has been generated
or disposed at a given site

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Properly implemented CP :
usually

increases profitability
lowers production costs
enhances productivity
provides a rapid return on any capital or
operating investments required

increases product yield

leads to the more efficient use of energy


and raw materials

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Properly implemented CP :
usually

(continuation)

results in improved product quality


increases staff motivation
relies on active worker participation in
idea generation and implementation
reduces consumer risks
reduces the risk of environmental
accidents
is supported by employees, local
communities, customers and the public
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Properly implemented CP :
often
avoids regulatory compliance costs
leads to insurance savings
provides enhanced access to capital
from financial institutions and lenders
is fast and easy to implement
requires little capital investment

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Cleaner Production principles


precaution principle
preventive principle
integration principle

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How CP could be applied in


practice?

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Cleaner Production practices


1. Good housekeeping
take appropriate managerial and
operational actions to prevent:
- leaks
- spills
- to enforce existing
operational
instructions

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Cleaner Production practices


2. Input substitution
substitute input materials
- by less toxic
- or by renewable materials
- or by adjunct materials which
have a longer service life-time
in production

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Cleaner Production practices


3. Better process control
modify:
- operational procedures
- equipment instructions
and process record keeping in
order to run the processes more
efficiently and at lower waste and
emission generation rates

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Cleaner Production practices


4. Equipment modification
modify the existing production
equipment and utilities in order:
- run the processes at higher
efficiency
- lower waste and emission
generation rates

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Cleaner Production practices


5. Technology change
replacement of:
- the technology
- processing sequence
- synthesis pathway
in order to minimise waste
and emission generation
during production

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Cleaner Production practices


6. On-site recovery/reuse
- reuse of the wasted materials
in the same process for another
useful application within the
company

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Cleaner Production practices


7. Production of a useful by-

product

consider transforming waste into


a useful by-product, to be sold
as input for companies in
different business sectors.

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Cleaner Production practices


8. Product modification
modify the product
characteristics in order:

- to minimise the environmental


impacts of the product during
or after its use (disposal)
- to minimise the environmental
impacts of its production

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CP versus End-of-Pipe
approach
Cleaner Production

Pollution Control and Waste


Management

Continuous improvement

One-off solutions to individual


problems

Progress towards use of closed loop


or continuous cycle processes

Processes result in waste materials


for disposal a pipeline with
resources in and wastes out

Everyone in the community has a


role to play; partnerships are
essential

Solutions are developed by experts


often in isolation

Active anticipation and avoidance of


pollution and waste

Reactive responses to pollution and


waste after they are created

Elimination of environmental
problems at their source

Pollutants are controlled by waste


treatment equipment and methods

Involves new practices, attitudes


and management techniques and
stimulates technical advances

Relies mainly on technical


improvements to existing
technologies
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What is not CP?


Off-site recycling
Transferring hazardous

wastes

Waste treatment
Concentrating hazardous

or toxic constituents to
reduce volume

Diluting constituents to

reduce hazard or toxicity


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What are the benefits of


Cleaner Production?
Improving
environmental situation
Increasing
economical benefits

Increasing
productivity

Continuous
environmental
improvement

Gaining
competitive
advantage
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CP barriers
Internal to the companies:

Lack of information and


expertise
Low environmental
awareness
Competing business
priorities, in particular, the
pressure for a short term
profits
Financial obstacles
Lack of communication in
firms
Middle management inertia
Labour force obstacles

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CP barriers
External to the companies:

-Difficulty in

The failure
of existing
regulatory
approaches

accessing
cleaner
technologies
-Difficulty in

accessing
external
finance

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CP motivators and drivers


Internal to the companies:
-

Improvements in productivity
and competitiveness

Environmental management
systems
and
continuous
improvement

Environmental leadership

Corporate environmental
reports

Environmental accounting

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CP motivators and drivers


External to the companies:
-

Innovative
regulation

Economic
incentives

Education
and
training

Buyer
supplier
relations

- Soft loans
from
Financial
institutions
-

Community
involvement

International
trade
incentives

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The role of
international organizations in CP
development
United Nations Environment Programme (UNEP)
United Nations Industrial Development

Organisation (UNIDO)

Organisation for Economic Co-operation and

Development (OECD)

World Business Council for Sustainable

Development (WBCSD)

Development Finance Institutions (DFIs)


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Team for CP success


Managers, engineers and finance people in
industry and commerce, in particular those
responsible for business strategy, product
development, plant operations and finance

Government officials, both central and


regional, who play an important role in
promoting CP
Media
representatives
who
play
an
important role in disseminating information
on good environmental practice
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Cleaner Production procedures


The recognized need
to minimise waste
The first
step

The second
step

The third
step

The fourth
step

Planning and
Organization
Assessment
Phase
Feasibility Analysis
Phase
Implementation

Successfully implemented CP projects

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1. Planning & Organization


Obtain management

commitment

Identify potential barriers

and solutions

Set plant-wide goals


Organize a project team
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2. Assessment
Identify sources
Identify waste/

pollution causes

Generate possible

options

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Material and energy balances


Heat

Raw
Materials

Power

The Industrial
Process

Cooling

The
Energy
Balance

Products
& Waste

The
Mass
Balance
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Why are material and energy


balances so important?
The material and energy balances are not only
used to identify the inputs and outputs of mass
and energy but their economic significance is
related to costs, such as:
cost of raw material in waste

cost of final product in waste


cost of energy losses
cost of handling waste
cost of handling waste
cost of transporting waste
cost of solid wastes disposal
cost of pollution charges and penalties
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Possible causes for waste


generation
Choice of
Production
Technology

Choice &
Quality of
Input Materials

Management
Planning &
Information
Systems

Technical
Status of
Equipment

Process

Personnel
Skills &
Motivation

Product
Specifications

Process
Efficiency

Wastes &
Emissions

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Option generation (1)

Creative Problem Solving (CPS):


-

Find facts
Identify the problem
Generate ideas to solve the problems
Define criteria to be used to select solutions/ideas

Screening of ideas / options:


-

Select all ideas/options that may be implemented immediately


The remaining options/ideas should then be divided into three boxes:
-

Good housekeeping
Interesting options but more analysis is needed
Waiting box + Rejected

Weighted sum method to prioritise options in second group:


-

What are the main benefits to be gained by implementing this option?


Does the necessary technology exist to implement the option?
How much does it cost? Does it appear to be cost effective, meriting
in depth economic feasibility assessment?
Can the option be implemented within a reasonable timeframe without
disrupting production?
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Option generation (2)


Traditional brainstorming
Formulate problem (problem

identification)

Define objective of the

brainstorming session

Follow the rules of brainstorming:


- Select a secretary to write down

all ideas (The secretary can't take


part in the idea generation)

- Select a group leader (the group

leader shall control that the four


main rules are followed)

Close the idea generation after

30-40 minutes

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CP assessment practices
Good
Housekeeping

Equipment
Modification

On-site
Recovery/
Reuse

Input
Substitution

Process

Production of
Useful
By-Product

Better Process
Control

Technology
Change

Product
Modification

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3. Feasibility Studies

Preliminary evaluation
Technical evaluation
Economic evaluation
Environmental evaluation
Selection of feasible options

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Payback Period
Capital investment
_____________________________

Payback period =
Annual operating cost savings
- period of time
(years) needed to
generate enough
cash flow to
recover the initial
investment

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4. Implementation &

Continuation

Prepare a CP plan
Implement feasible CP measures
Monitor CP progress
Sustain Cleaner Production

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CP attacks the problem at several


levels at once. The implementation
of an industry/plant level
programme requires,
- the commitment of top management
- a systematic approach to CP in all

aspects of the production processes

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CP management system
Marketing

Top management
commitment
Pre-assessment
CP policy
declaration
Start CP project
Top Management reviews
Final report

The continuous
CP loop

Measure progress

Project organization
Assessment

CP options

Project implementation

Feasibility analysis
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Assessment report

CP and main stakeholders

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How can governments


promote CP?
Applying regulations
Using economic instruments
Providing support measures
Obtaining external assistance

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CP applicability for local


governments

Corporate decision-making

Local environmental management strategies

Community and industry partnerships

Sustainable economic development

Public environmental education

Specific local environmental


problems

Local environmental
monitoring
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CP and financial institutions


Environmental evaluation can help:

Establish an exclusion list


Identify environmental
risks in every project
Understand the financial
institutions exposure to
environmental risks and
liabilities
Monitor the environmental
risks of transactions and
respond
Evaluate risks and
liabilities in foreclosure or
re-structuring activities
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What are the benefits of


Cleaner Production?
Financial advantages:
Usually a short Payback Period of only months
Many low-cost options
Quick to implement
Improved cash flows
Greater shareholder value
Better access to capital and appeal to financial
institutions
Inherent preventive approach leads to insurance
savings

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Overall Risk Profile


CONSUMERS
WORKERS

HEALTH

NEW
REGULATIONS

ENVIRONMENTAL
ACCIDENTS

HEALTH

RISKS
REPUTATION

LIABILITY
CLEAN-UP

BUSINESS VALUE
INSURANCE

PRODUCT SALES

CLAIMS
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Main factors affecting


exposure to environmentallyderived risks
The nature of environmental risks
inherent in business activity of the
client
The size and term of, and the security
for, the transaction
The clients ability and commitment
to adequately manage these risks

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If a CP project is presented to a financial


institution, it should be clear that the
company already undertook voluntary actions
aimed at:

rationalising the use of raw materials, water and energy


inputs, reducing the loss of valuable material inputs and
therefore reducing operational costs

reducing the volume and/or toxicity of waste, wastewater


and emissions related to production

improving working conditions and occupational safety in


a company

making organisational improvements

improving
environmental
performance
by
the
implementation of no-cost and low-cost measures from
the companys funds

reusing and/or recycling the maximum of primary inputs


and packaging materials
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Environmental investment
opportunities
loans to enterprises to finance required or desired

investments in technologies resulting in direct and


indirect environmental benefits

loans to municipalities to finance investments in

environmental infrastructure

loan

guarantees
to
both
enterprises
and
municipalities for soft credits from national or
regional environmental funds for environmental
investments

loans

to
finance
businesses
environmental goods and services

providing

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What have we learned?


The CP approach reduces pollutant generation at every

stage of the production process

CP can be achieved through:


-

good operating practices


process modification
technology changes
raw material substitution
redesign and/or reformulation of product

The economic advantages of CP are:


-

cost effectiveness
increased process efficiency
improved product quality and enterprise competitiveness
cost of final treatment and disposal is minimised

Effluent treatment, incineration, and waste recycling outside

the production process are not regarded as CP

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Broader Application of CP
CP is closely linked to:
Environmental Management
Systems
Total Quality Management
Health and Safety
Management

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Cleaner Production and


Sustainable Development
Sustainability
Environmental
space

Economic Instruments

Factor X

Co-regulatory agreements

Responsible
Entrepreneurship
Eco-efficiency
Cleaner Production

Command & control


Compliance

Agenda 21

Government
Agenda

Business
Agenda

Sustainable
development

EHS

ICC

Auditing

Charter

EMS

Time
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!!!
CP is
a journey
not a
destination
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An understanding of
the business value to be
gained from efficient use
of natural resources is an
important first step
toward sustainability:
toward building a world in which resources
are managed to meet the needs of all
people now and in the future.
(J. Lash, President of
the World Resources Institute)
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