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Integrated Supply Chain Information

3 Introduction to the five schemes

• 3.1 Environmental Info systems based on legal requirements
  • 3.1.1 The IPPC Directive
  • 3.1.2 Safety Data Sheets (SDS's)
• 3.2 Environmental info systems based on voluntary schemes
  • 3.2.1 EMAS
  • 3.2.2 The EU Eco-label
  • 3.2.3 Environmental product declarations (EPD)

A brief introduction to the five schemes is given below - divided into systems based on mandatory requirement and systems based on voluntary approaches.

3.1 Environmental Info systems based on legal requirements

3.1.1 The IPPC Directive

The Integrated Pollution Prevention and Control Directive (Council Directive 96/61/EC) (IPPC-Directive) entered into force October 1996, and came into effect three years later. Its objective is to apply the principle of integrated permits to prevent or minimise air, water and soil pollution by emissions from certain categories of industrial installations in the Community, with a view to achieving a high level of environmental protection. The directive includes the following issues:

1. the general principles governing the basic obligations of operators;
2. requirements for the application, issuing, reconsideration and updating of permits;
3. minimum requirements to be included in any such permit;
4. measures to ensure compliance with permit conditions;
5. requirements relating access to information and public participation in the permit procedure.

All installations covered by Annex I of the Directive are required to obtain an authorisation (permit) from the authorities and are required to report emissions or releases. Unless they have a permit, they are not allowed to operate.

The directive contains basic rules for the permits. It is an “integrated” permit and it means that the permits must take into account the whole environmental performance of the industrial activity, i.e. emissions to air, water and land, generation of waste, use of raw materials, energy efficiency, noise, prevention of accidents, risk management, etc.

The permits must be based on the concept of Best Available Techniques (BAT). Assistance to find out which techniques is BAT is available in the Annex IV of the Directive. It contains considerations to be taken into account when determining BAT. Furthermore, so-called BREF's (BAT reference documents) have been developed for over half the sectors listed in annex 1. The BREF's are intended to assist licensing authorities and applicants in how to work with BAT.

In some cases BAT means quite radical environmental improvements, which may be very costly for companies to implement. Therefore, the Directive grants these installations an eleven-year long transition period counting from the day the Directive entered into force.

The compliance with the Directive is enforced and monitored differently in the member countries. To share experience, the European Union Network for the Implementation and Enforcement of Environmental Law (IMPEL) has been established. IMPEL is an informal Network of the environmental authorities of the Member States and associated countries.

The IPPC Directive also provides for the setting up of a European Pollutant Emission Register (EPER).

EPER was launched in Februaryy 2004 on the EU IPPC and national homepages. The EPER is a public register to provide environmental information on industrial activities covered by the IPPC Directive. The objectives are:

• to enhance public awareness making the data accessible on an Internet site
• to trigger industry in improving environmental performance and innovating industrial processes. The achievements by industry will result in emission reductions that can be monitored and demonstrated in the EPER register
• to evaluate the progress of achievements in meeting environmental targets in national or international agreements.

The registration is mandatory, and periodically reports from companies on their releases to air, water, soil and wastes are send to the competent authorities reviewing the data.

The EPER is an integrated database with information intended for environmental management both by government in developing environmental policy and by industry in improving eco-efficiency. It is a tool to enhance public awareness of environmental pollution, to inform the public on emissions from individual sources and to enable the public to compare emissions from different sources. It also enables individual facilities to compare their own environmental performance to that of other facilities with similar industrial activities, thus facilitating gradual improvement of environmental management by these facilities and industry in general.

Approximately 20,000 facilities are included in the EPER register.

3.1.2 Safety Data Sheets (SDS's)

The purpose of the safety data sheets are to provide professional users with information on hazardous properties of products in order to enable the user to take the necessary measures to protect health and safety at the workplace and protect the environment. The information includes declaration of hazardous ingredients, as well as guidelines in connection with handling, use and disposal of the product.

Any person (manufacturer, importer or distributor) who is responsible for placing a hazardous chemical product/preparation on the market must supply the professional user with a safety data sheet providing proportionate information.

The information in the safety data sheet primarily aims at the professional user and should enable the employer to assess any risk to the health and safety of workers arising from the use of the product.

Safety data sheets must be prepared according to the EU directive on safety data sheets and requires the following basic information:

• The chemical composition of the product, as a minimum the content of hazardous substances stating percentage intervals.
• The physical/chemical properties of the substance/product.
• The use(s) of the substance/product, including application method(s).

A safety data sheet must be divided into the following 16 sections:

1. Identification of the substance/preparation and of the company/undertaking
2. Composition/information on ingredients
3. Hazard identification
4. First-aid measures
5. Fire-fighting measures
6. Accidental release measures
7. Handling and storage
8. Exposure control/personal protection
9. Physical and chemical properties
10. Stability and reactivity
11. Toxicological information
12. Ecological information
13. Disposal consideration
14. Transport information
15. Regulatory information
16. Other information.

Dangerous substances contained in preparations and presenting a health or environmental hazard within the meaning of Directive 67/548/EEC, must be listed in the SDS (section 2) together with their concentration or concentration range, if they are present in concentrations equal to or above a defined concentration limit.

For a preparation not classified as dangerous according to Directive 1999/457EC, the following substances must be indicated together with their concentrations or concentration ranges, if they are present in individual concentrations of = 1 % by weight for non-gaseous preparations and = 0.2 % by volume for gaseous preparations:

• Substances presenting a health or environmental hazard within the meaning of Directive 67/548/EEC
• Substances for which there are Community workplace exposure limits.

In section 16 of the safety data sheet can be stated any other information, which is considered to be important to the health and safety of the user and to the protection of the environment, e.g. information related to requirements in eco-labels.

According to the Directive, the information in the SDS must be written in a clear concise manner. The SDS should be prepared by a competent person, who should take into account the specific needs of the user, as far as it is known. Persons placing substances or preparations on the market should ensure that competent persons have received appropriate including brush-up training.

When a safety data sheet has been revised, the changes should be brought to the attention of the recipient.

The safety data sheet is an important tool with which to communicate health, safety and environmental aspects of a hazardous product in the supply chain.

The compliance with the directive – and potential additional national requirements - is monitored differently in the member countries. Most countries apply more or less frequent spot checks of the SDS's based on sampling at work places. As a result the quality of safety data sheets differs a lot.

3.2 Environmental info systems based on voluntary schemes

3.2.1 EMAS

Environmental management systems are designed to help organisations to improve their environmental performance including the lifecycle performance of their products, activities and services. The systems allow organisations to have a clear picture of their environmental impacts, help them to target the significant ones and to manage them. Environmental management systems also help introduce changes in management style by bringing environmental issues into the day-to-day management of organisations.

The EU Eco-Management and Audit Scheme (EMAS) has been available for participation by companies since 1995 (Council Regulation (EEC) No 1836/93 of 29 June 1993) and was originally restricted to companies in industrial sectors.

Since 2001, EMAS has been open to all economic sectors including public and private services (Regulation (EC) No 761/2001 of the European Parliament and of the Council of 19 March 2001). In addition, EMAS was strengthened by the integration of EN/ISO 14001 as the environmental management system required by EMAS, by adoption of an EMAS logo to signal EMAS registration to the outside world, and by considering more strongly indirect effects such as those related to financial services or administrative and planning decisions.

Participation is voluntary and extends to public or private organisations operating in the European Union and the European Economic Area (EEA) — Iceland, Liechtenstein and Norway.

An EMAS award shows the public that the organisation has set up an environmental management system that allows it to manage its environmental aspects and continually improve its performances.

To receive EMAS registration, an organisation must comply with the following steps:

1. Conduct an environmental review considering all environmental aspects of the organisation's activities, products and services, methods to assess these, its legal and regulatory framework and existing environmental management practices and procedures.
2. Establish an effective environmental management system (EMS) aimed at achieving the organisation's environmental policy defined by the top management. The management system needs to set responsibilities, objectives, means, operational procedures, training needs, monitoring and communication systems.
3. Carry out an environmental audit assessing in particular the management system in place and the conformity with the organisation's policy and programme as well as compliance with relevant environmental regulatory requirements.
4. Provide a statement of its environmental performance, which lays down the results achieved against the environmental objectives and the future steps to be undertaken in order to continuously improve the organisation's environmental performance.

The environmental review, EMS, audit procedure, and the environmental statement must be approved by an accredited EMAS verifier. In addition, the validated statement must be sent to the EMAS Competent Body for registration and made publicly available before an organisation can use the EMAS logo.

The 3rd party verification system includes both a certification process for the applier and an authorisation process for the verificator. This international standardised and adopted system is further described in section 8.

Both EMAS and EN ISO 14001 have the common objective of providing good environmental management. However, they are too often seen as competitors. The Commission has recognised that the International Standard for Environmental Management Systems, EN ISO 14001, can provide a stepping-stone for EMAS. The adoption of EN ISO 14001 as the management system element of EMAS will allow organisations to progress from EN ISO 14001 to EMAS without undue duplication of effort.

EMAS goes beyond EN ISO 14001 in a number of ways, requiring an initial environmental review, active involvement of employees in the implementation of EMAS, and publication of relevant information to the public and other interested parties.

In the middle of 2004, almost 4,000 companies in Europe were EMAS-registered compared to almost 18,000 European companies certified with ISO 14.001. Worldwide approx. 66,000 companies run an ISO 14.001.

3.2.2 The EU Eco-label

The EU-regulation for the Eco-label was adopted in 1992 and revised for the first time in 2000. The regulation sets up a detailed system for managing the development and adoption of new label criteria and for their revision. The regulation also requests the member countries to set up an appropriate organisation to manage the regulation and to promote the use of the label.

The overall purpose of the eco-label is to make it easier for the consumer to identify and purchase products with a documented low environmental impact compared to similar products and that producers may make use of a credible third party verified instrument in their marketing of environmentally high quality products. Eco-labels are intended to be based on a uniform, reliable, transparent and impartial system in connection with information on the environmental performance of the products ^[1].

In 2004, criteria have been established for 21 product groups and 1 service area (tourist accommodation), e.g. refrigerators, hard flooring, laptop computers, and chemical products like universal cleaning agents, washing agents and paint and varnish. The intension is to increase the number of product groups to 25 - 35 by 2006. The validity period of Eco-label criteria is 3-6 years.

The Commission has established a stakeholder forum, EUEB (the European Union Eco-labelling Board) to ensure a well-balanced participation of all relevant interested parties affected.

The development of eco-label criteria is based on market feasibility studies, life cycle based assessments and state-of-the-art analysis regarding technological development. It may take up to 3 years to establish the criteria for a new product group.

New product categories can be assigned the eco-label if ”based on the consumers' choice of product there can be a substantial improvement of the environment”.

Market feasibility

Before a decision is made regarding initiation of development of new criteria, an analysis is performed on the various types of products within the product group in question on the EU market, the amounts produced, imported and sold as well as the market structure in the member states. Trade inside and outside the Union is also considered. Consumer perceptions, functional differences between the product types and the need to establish sub-groups are mapped and evaluated as well.

The objective is to evaluate the possibilities for the eco-label to be applied as a market tool both by the producers and the consumers.

Life cycle based assessments

The most important environmental impacts, for which criteria are to be prepared, are defined using life cycle based investigations. The life cycle assessments is to be characterised as “life cycle thinking” and has only in rear cases followed the ISO 14040 standard. As life cycle assessments are relative expensive to conduct, a reuse of “old” assessments are seen. This may however overlook essential new knowledge and in the end impact the credibility of the criteria in relation to the objective of the label.

The lack of strict guidelines for elaboration of criteria documents has resulted in assessments of varying strength. The background document for indoor paint and varnish product is for example based on lifecycle assessments from 11 paints. The data collection was conducted in the period 1991-1992. The present criteria document is therefore based on knowledge collected more than 10 years ago.

Technological assessments

As a supplement to the life cycle investigations, a technological improvement analysis is conducted, as a criterion is required to contribute to continuous improvement of the environmental performance of the product group.

The analysis includes the following aspects:

The theoretical potential for environmental improvements compared with the possible changes in market structures. This is based on an improvement evaluation on the basis of the lifecycle considerations.

The technical, industrial and financial feasibility and market changes.

Consumer behaviour, perceptions and preferences influencing the efficiency of the eco-label.

The selection of environmental impacts, for which criteria should be made, is based on a priority of the most environmental significant loads and those whose technology is readily available for improvement. The criteria are finally adopted by the EU competent authorities.

A detailed description of the procedure of criteria development and adoption is presented in Annex 1.

In addition to the criteria based on the lifecycle investigations, the criteria include demands for health and for handling the product, i.e. manuals, noise, reuse/recycling declarations.

Health criteria are often indirectly included as restrictions on chemicals with particular health classifications (typically chronic effects such as carcinogenic effects and reproduction toxicity), limitations of the amount of chemicals used as well as declarations of ingredients as guidance to consumers.

According to the regulations, the national authorities are obliged to establish a body for control of applications, for licensing and for compliance monitoring. No guidelines have been established for how these obligations should be implemented. It is therefore anticipated that difference in management (compliance assessment and monitoring) may exist between member states.

3.2.3 Environmental product declarations (EPD)

By 2004, seven countries had an adopted national EPD system more or less in accordance with ISO type III labels. The most developed system in Europe is the Swedish EPD system. A brief description of type III product declaration systems worldwide is given in Annex 2.

The purpose of the EPD is to sum up life cycle based high priority data regarding the environmental profile of the product. Such data may be used in environmental management, in product innovation and design and for informing professional customers of environmental profile of the product. The user-face of EPD is thus primarily business-to-business.

ISO adopted in 2000 a technical report regarding EPD after several years of discussions (ISO TR 14025). The technical report describes possible elements of the so-called ISO type III labelling. This work has progressed since then and ISO intends by the end of 2005 ISO to publish a standard for EPD principles and programmes - ISO 14025. This International Standard will establish the principles and procedures for developing Type III environmental declaration programmes and Type III environmental declarations. It will also specifically establish the use of ISO 14040 standards on LCA in the development of Type III environmental declaration programmes and Type III environmental declarations.

The LCA – or life cycle inventory (LCI) – identifies the environmental impacts divided into a number of preset categories over the entire life cycle from cradle to grave and offers the possibility to identify where in the lifecycle the most important environmental loads are to be found. Such LCA data is the core element of the ISO type III Ends. The EPD therefore is an important fundament for the company in its effort to prioritize its environmental work. In addition the standardised approach of the ISO type III labelling facilitate that the company may compare the environmental impact of comparable and competing products from suppliers and are thus given the possibility to let environmental aspects be included in purchase decisions.

The main thoughts and ideas of the EPD system is presented in table 2 as set up by the Swedish competent EPD body.

Table 2 General principles behind the Swedish EPD programme ^[2]

In order to compare the environmental impact at a quantifiable level in a lifecycle perspective and thus to compare the EPD's for different products, the results obtained must be presented in a uniform manner. It is therefore necessary on top of the ISO standard to define functional units, system limits, set up strategies for data collection, calculation methods and result analysis guidelines. Within the Swedish EPD scheme this has been covered through the development of a document identifying, in a detailed and structured manner, which product information must be included in the environmental product declaration and which may be excluded. The general EPD document specifies how the ISO standard should be interpreted within the geographic area to be covered by the EPD competent body – private or public.

It is necessary to implement specific guidelines for each product category. Within the EPD framework, this is accomplished by so-called ”Product Category Rules” (PCR) ^[3]. The PCR is based on a LCA approach as described in ISO 14040 for the defined product category and identifies the primary environmental impacts of the product seen in a life cycle perspective. The PCR document also defines the data format, the structure of the EPD, etc.

PCR must be prepared as a supplement to the general regulations to ensure comparability between the products within the same category. At the moment, approximately 50 PCR documents have been prepared in Sweden.

In Sweden the EPD competent body (”The Swedish Environmental Management Council”) has prepared a guideline for how a PCR should be established ^[4].

The period of validity for a PCR in Sweden is typically 3 years.

Footnotes

[1]www.europe.eu.int/comm/environment/eco-label/index_en.htm

[2]www.environdec.com

[3]ISO 14025 use the term Product Category Rules (PCR). Many countries use the term Product Specific Requirement (PSR) meaning the same. Countries that have prepared PCR documents: Sweden, Japan. Countries where PCR documents are being prepared: Denmark, South Korea, and Italy.

[4]Product specific requirements (PCR) for preparing an environmental product declaration (EPD), volume III, Swedish Environmental Management Council (www.environdec.com)

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Version 1.0 February 2006, © Danish Environmental Protection Agency