A Conversation with Kim Jeffery on Extended Producer Responsibility (EPR)
STRATEGIES YOU CAN USE (8)
Extended producer responsibility, product stewardship and product take-back
Product stewardship is basically synonymous with EPR (extended producer responsibility in the EU or extended product responsibility in the US). Product stewardship involves taking responsibility for your product for its entire lifetime.
Planning for proper management and handling at the end of its useful life is one aspect of this, usually the part that gets the most attention, which is why we consider it under the operations category rather than design. But what we are really talking about is a full life cycle approach.
At its core is a fundamental shift in responsibility, one that many in industry have resisted. In the past, companies were held responsible for the manufacturing of their goods and also the performance of those goods. Did you cause effluent to flow into the river? Did the disposal of your hazardous waste cause people to become ill? Were the safety features of your product adequate to prevent injury in use? But until recently no one asked who was responsible for managing the disposal of a product at the end of its useful life.
To be fair, the ‘bottle bills’ in Oregon and California during the early 1970s set a precedent for EPR at least in the US. But it has only become a hot issue as a result of the massive rise in electronic waste. Suddenly, municipalities with waning budgets and an impending tidal wave of hazardous e-waste filled with lead and other rare metals are baulking at having to manage its disposal.
Germany was one of the first countries to go to the manufacturers to ask them to foot the bill. Not surprisingly they declined. So the municipalities refused to accept certain types of waste and compelled the manufacturers to come up with a system for disposing of it responsibly. At present, EPR regulations vary from country to country. The European Waste Electrical and Electronic Equipment (WEEE) Directive covers basically anything with a cord.
In June 2008, the European parliament updated their regulations, which now specify a recycling target and lay out a five-step hierarchy for waste disposal: prevention, reuse, recycling, recovery, and disposal. The European Union countries will have two years to enact these regulations into law. Even packaging must be taken back. In Canada, British Columbia passed legislation that covers paints, pesticides, pharmaceuticals and other household products.
Once the genie was out of the bottle, other municipalities piled in and the manufacturers will probably never be able to put the responsibility for disposal back on the taxpayer. While Europe is far ahead of the US in this matter, the US has begun to address carpeting waste and e-waste. Producers of nickel-cadmium batteries set up a voluntary but poorly advertised programme. However, thanks to some enterprising work from some of our Zero Waste Alliance colleagues, electronics has been thrust into the limelight. The Electronic Products Environmental Assessment Tool (EPEAT) voluntary standard is based on product stewardship concepts. While the standard is voluntary, the US General Services Administration announced in advance that the vast majority of the computers and monitors they would buy must meet this standard. Other countries are also adopting EPEAT. This has shifted the entire industry and the Green Electronics Council is now working on other electronic products. The writing is on the wall. Their criteria would be useful in many settings, both for product design and purchasing. Go to www.epeat.net to look at the detailed criteria.
Here are the main categories:
• Reduction/elimination of environmentally sensitive materials;
• Materials selection;
• Design for end of life;
• Product longevity/life cycle extension;
• Energy conservation;
• End-of-life management;
• Corporate performance;
• Packaging.
Many businesses look at this as a Pandora’s Box situation and wonder what other product categories will be affected next. The first reaction from manufacturers when their product is targeted is panic – what are we going to do with all this refuse? But then they begin to understand how to mine the waste stream. Xerox has excelled at this. Since they leased many of their copiers, the product already tended to come back to them. At least in part to save jobs, they created a disassembly plant. Now they carefully test the components that come out of the old copiers. If the recycled parts match the performance of new parts, they are put into ‘new’ copiers. Xerox has saved more than US$2 billion since 1990 and diverted the equivalent of 2 million printers and copiers from the landfill.
To make this work, they have had to develop sophisticated systems for forecasting when these recycled parts will be available. This has also had an impact on product design. As Elizabeth Graves, environmental health and safety regulatory affairs manager at Xerox explains:
Our engineers design product components for durability over multiple lives and commonality with a wide range of models. As a result, components can not only be reused in the same model but also in the next-generation models (through a process some call ‘up-cycling’).
The Japanese computer manufacturer NEC has created a new business refurbishing old computers. They purchase their old computers (2000 or later models) from customers, fix
them up, load new software, and then resell them as ‘NEC Refreshed PCs’ with a six-month warranty. Noboru Ozawa, group manager of the refreshed PC sales group, said they expected to lose money, at least initially, but instead, the operation has been profitable from the first year: ‘It’s often said that environmentalism does not generate profits, but we were actually able to successfully reduce environmental impact while contributing to our bottom line.’
While one might expect this business to undermine their new computer sales, they have found the opposite. New PC buyers and second-hand buyers are different pools of people,
so they have actually expanded their user base. Each refreshed PC is estimated to save 100kg of greenhouse gases. In addition, for every second-hand computer they purchase, NEC also pays for one tree to be planted in the Kangaroo Island, Australia reforestation effort.
In conclusion
As you can see from the examples above, there is a lot of profit being left by manufacturers still oblivious to sustainable business practices. Sustainability, on the one hand, is a risk management issue, protecting against legal liability, new regulations, shareholder initiatives, and NGO publicity stunts. On the other it is a strategic issue, honing competitiveness, gaining access to high-margin markets, and developing innovative new products. When you can, eliminate negative social and environmental impacts in the design process. Since design tends to be episodic, however, also investigate the practices associated with operations and waste management.
