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Model for selection of future target areas in the Danish Program for Cleaner Products

Summary

During the last nearly 5 years’ Programme for Cleaner Products, a central part of the effort has been focused on selected industrial sectors and rooted in the matching sector associations. Several evaluations show that in many cases this approach is fruitful.

However, an industrial sector based effort is often linked to the production of the products, while especially the use and disposal phases with the related environmental impacts are not to the same extent the object of an effort. Conversely, the effort has to be rooted somewhere, and here the sector associations have turned out to be of great value.

Thus, the ideal of the future effort would be that there were both focus on improvements in the whole life cycle of the products, and that the associations and other central players were involved.

1.1 Background and purpose

The Environmental Council for Cleaner Products prioritized in 2001 the development of a method to secure, that the future product-orientated effort would focus on the most important products with regard to the environment. The method should create a consistent and documented basis covering environmental aspects of all product groups, and thus support the selection of the future fields of effort.

Therefore, this project has had the purpose to develop the first, preliminary version of the method, which can point out and specify relevant fields of efforts for the future Programme for Cleaner Products. The project is meant as a forerunner of a more detailed project, developing the model further and strengthening the weaknesses, which naturally occur in a preliminary, screening-based model.

Furthermore, it has been a purpose to link the product effort aiming at the line of industrial sectors up to now with the selection of environmentally relevant product groups, with the purpose to point out the product groups where no effort of the related sector associations has taken place or is going on.

1.2 Method

The developed method consists of an Access database, which is built up with a product approach and a sector approach. The database is fundamentally structured from "Varestatistikken" (goods statistics), "Råvarestatistikken" (raw material statistics) and "Udenrigsstatistikken" (foreign trade statistics) of Statistics Denmark. To get a manageable number of product groups, which can be used for a screening purpose, the method operates with in total 95 product groups (2-digit KN code level) and 106 industrial production sectors, complemented with 40 sectors with no production within building/construction and trade (3-digit DB-93 code level). Through the goods statistics, the product groups have been connected with the production sectors, and furthermore economic information from the goods statistic has been added to calculate a supply figure, illustrating the economic importance of the product group in Denmark. Through the foreign statistics, the product groups have been connected with the industries with no production (building/construction as well as trade which is not included in the goods statistics). Furthermore, data from the foreign statistics together with the raw material statistics are used to make the preliminary estimations of the flow through the product chains – from raw materials through production to trade with manufactured goods. As for the time being, there is not only one statistic gathering all information about the flow of the products through the product chains, it has thus been necessary to piece a picture together from several statistics.

Product approach

For each of the 95 product groups, an environmental assessment as well as a subsequent ranking in the groups in high, medium or low has taken place. The environmental assessment is carried out from the American input/output database "eiolca" (Economic Input/Output LCA), which contains data from 485 product groups. The American product groups can reasonably be matched with the Danish product groups, and by using the American database it was thus possible to create a homogeneous and consistent basis for evaluation of all 95 Danish product groups. This was not possible via the other methods, that were tested in the project.

Input/output analyses include the phases in the life cycle from raw material extraction to production of end products. Thus, the use and disposal phases are not included. This is probably– together with the fact that resource consumption is not a part of the environmental assessments – the major limitations in using the American database.

"eiolca" contains a number of environmental parameters, where the following eight (see figure 1) are selected as representative of an assessment at screening level:

Figure 3:
The eight environmental parameters used in the environmental screening.

For each of the 95 product groups, a scoring in high, medium and low on all 8 parameters, and a total scoring has been carried out. The total score is the result of the environmental assessment. The ranking at three levels in this screening version of the method is chosen, because there is a number of built-in uncertainties by using the American method and by working at the chosen, overall product group level. It makes no sense, thus, to carry out a ranking at a more detailed level.

Whether a product group is assessed high, medium or low is defined from the following method:

1. For each of the 8 chosen environmental categories, the product groups are sorted according to descending environmental impact. The product groups are then divided equally into the three groups "high, medium and low".
2. Then an overall assessment – the total scoring - of the product group is conducted based on the assessments of each of the 8 environmental categories. The overall assessment on "high, medium or low" is made from the following rules:

• If the environmental assessment for 3 or more of the 8 environmental categories is estimated as "high", the total environmental impact for the product group is assessed as high. In this way a "high" environmental assessment weights relatively harder than an average calculation.
• If the environmental assessment for 6 or more of the 8 environmental categories is estimated as "low", the total environmental impact for the product group is assessed as low. In other words, it is not easy to obtain the score "low".
• In all other cases the environmental assessment of the product group is set to medium.

The environmental assessment is subsequently complemented with a combined environmental/economic assessment, where the supply number (imports + national production – exports) for each product group is multiplied with data for the overall environmental assessment as an expression of the environmental/economic importance of the product group.

The sector approach

The Access database contains information, too, about the product-orientated environmental effort up to now, partly as efforts in the sector (establishment of product panels and sector projects carried out or planned), and partly as product efforts (measured by defined eco-label criteria and environmental guidelines for purchasers).

The Access database also includes sector-based information on efforts under the former "Programme for promotion of environmental management and revision in Danish small and medium sized enterprises". Correspondingly, information on whether company types connected to each of the sectors are subject to a requirement of environmental licences according to the chapter 5 of the Danish Environmental law. This type of information can form a part of an assessment of the basis for carrying through a product-orientated effort in the sectors.

Taken together, the development of the method and the use of it to select possible future fields of efforts are carried out in five steps as stated in Figure 2.

Figure 4:
The 5 steps in development and use of the method

1.3 Project results

Selection of relevant product areas

By using the described method on all 95 product groups, 45 of them reach "high" in the environmental assessment. Accordingly, in total 34 product groups reach an overall "high" environmental/economic assessment. The common denominator of these two assessments is a list of in total 19 product groups, that thus get both a high environmental assessment and a high environmental/economic assessment.

For these 19 product groups, it has been investigated whether there has been a sector-based environmental effort under the Programme for Cleaner Products . If such an effort is taking or has taken place the product group is eliminated from the list.

The result is in total 14 product groups, that are from an environmental point of view potentially interesting for a future product-orientated effort, and where no sector based efforts for these product groups has taken place. These 14 product groups are:

• Salt, soil and stones of many kinds
• Mineral fuels
• Inorganic chemicals
• Organic chemicals
• Fertilizers
• Various chemical products
• Rubber and goods of rubber
• Goods of stone, plaster etc.
• Iron and steel
• Goods of iron and steel
• Copper and goods of copper
• Aluminium and goods of aluminium
• Various goods of non-precious metals
• Locomotives etc.

The 14 possible fields of efforts are exclusively selected from an environmental and environmental/economic point of view. Other circumstances such as political priorities, wish for visibility, considerations about the interests of the sector organizations to carry through an effort etc. are not included in this project.

The effort up to now has had a sound environmental focus

If the overview of the sectors, where an earlier product-orientated effort under the Programme for Cleaner Products has taken place, is compared to the environmental assessment of the product groups it appears that the effort up to now has had a good focus on the environment. Sectors as the textile sector, the electronics sector, the construction sector, the washing, cleaning and cleansing sector, the dye/lacquer sector and the transport sector where an effort has taken place earlier or where an effort is going on for the moment, all produce products that have reached the environmental scoring "high".

Recommended types of efforts in future

In order to estimate which kind of future environmental effort, that will be relevant within the 14 product groups, their characteristics have been described in details from all the information included in the Access database. For example, environmental data from the American database are investigated closely for each product group, to get information about which environmental circumstances being most important in the life cycle to and including production of end products. Furthermore, the connection of the product group with one or several industrial sectors is described, and characteristics as size and number of employees for companies within the most important sectors are listed. Information about the financial importance of the product group in the Danish economy, and about imports and exports are also described together with a number of other information about the product group and the related sectors. A large part of the information is included in order to carry through some preliminary considerations about the product chains of the products and potential stakeholders, and thus the potential to carry through an environmental effort including all the critical phases in the life cycle of the products.

The examination of the 14 product groups shows substantial differences. For some product groups, there is a large import (applies for example in general for chemicals and for the product groups "Rubber and goods of Rubber", "Iron and steel" and "Copper and goods of copper"), which indicates that it is relevant to focus on international co-operation and control of suppliers in international product chains.

For other product groups (for example "Various chemical products", "Iron and steel" and "Goods of iron and steel"), the wholesale and retail trades are of great importance, and therefore it would be relevant to focus on an effort where both manufacturers and the wholesale and retail trades participate.

In the project the recommended fields of effort are divided into the following:

1. Sector based effort towards production companies where there has been no focus earlier. This implies that there are one or several sector associations in which the effort can be rooted.
2. Supplementary sector effort in ongoing areas.
3. Product chain projects with focus on supplier control in international product chains.
4. Product chain projects with focus on production, use and disposal, that means where manufacturers and the wholesale and retail trades participate, or where the end users have great influence on the decisions of the previous links in the product chain.
5. Stakeholder projects with special focus on making existing knowledge useful and spread it, among this also in (public) tenders.
6. Incorporation in the effort for other product groups, which especially is relevant for the product groups being primarily raw materials and/or semi-products.

For each of the 14 product groups, it is estimated within which of the 6 areas there seems to be the largest potential. There might be several types of efforts connected to the product group in question.

Further development of the method

The method developed in this project is based on a screening approach. Thus, a number of limitations and choices are made during the project, and this has naturally influenced the predications of the model.

The major benefit of the developed method is, that it gives a uniform and consistent environmentally based basis for selection of relevant product groups for a future effort. The limitations in the method are primarily connected to the content in the American database, as well as the chosen level of details of product groups and the underlying industrial sectors.

As the American database is based on input/output analyses, the use and disposal phases are not included and this ought to be in focus at a possible further development of the method. Furthermore, the information about resource consumptions and other environmental aspects (especially waste and chemicals) ought to be considered carefully, as they are not or only to a limited extent included in the American database.

In order to handle the amount of information connected to product groups and industrial sectors at a screening level, a relatively overall level with 95 product groups and 106 production industries as well as 40 industries with no production is chosen. This choice means that much information covers a wide spectrum of products and industrial sectors. In a possible further development of the method the level of details therefore ought to be clarified, where practically possible. However, it is not certain that it is possible to get access to information at a more optimal level of details for all product groups and sectors, as the statistical information already at the present level at certain areas is limited due to confidence.

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