1. How did environmental strategies evolve? 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 2. What is CP? 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) 3. How CP is applied in practice: CP practices Benefits and barriers Procedures 4. What is CP contribution to main stakeholders? Governments Financial institutions
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 How did environmental strategies evolve? W hat is CP? How CP is applied in practice: CP practices Benefits and barr iers Procedures W hat is CP contribution to main stakeholders? Govern ments Financial institutions Course Objective At the completion of this course the par t icipants 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 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 • BOD • broke • contaminated solids • core loss • customer returns • damage • draining • dust • effluent • evaporation • furnace loss • greenhouse loss • hidden losses • leakage • non-conforming material • overfill • packaging • process loss • rework • second quality • stock loss • washings and etc !!! Waste is waste what ever you call it : take the oppor t unity to cut waste and increase profits! Cleaner Production Financing The “Cost of Waste” Iceberg t& n e l m sa t e a i s po r T D Re g Co ulat mp ory lia nc e ny pa Im Lia bil it y m Co THE HIDDEN COST , OF WASTE gy r w Ene a t R ials, s Lo ter Ma bor La e ag 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 10 CP management system Marketing Top management commitment Pre-assessment CP policy declaration Start CP project Top Management reviews Final report Measure progress The continuous CP loop Project implementation Assessment report Project organization Assessment CP options Feasibility analysis 50 CP and main stakeholders 51 How can governments promote CP? • Applying re gulations • Using economic instruments • Providing suppor t measures • Obtaining extern al assistance 52 CP applicability for local governments • Cor p orate decision-making • Local environmental management strategies • Community and industr y par t ner ships • Sustainable economic development • Public environmental education • Specific local environmental problems • Local environmental monitoring 53 CP and financial institutions Environmental evaluation can help: •Establish an exclusion list •Identify environmental risks in every project •Understand the financial institution’s exposure to environmental risks and liabilities •Monitor the environmental risks of transactions and respond •Evaluate risks and liabilities in foreclosure or re-structuring activities 54 What are the benefits of Cleaner Production? Financial advantages: Usually a shor t 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 • • • • • • 55 Overall Risk Profile CONSUMERS’ WORKERS’ HEALTH NEW REGULATIONS ENVIRONMENTAL ACCIDENTS HEALTH RISKS REPUTATION LIABILITY CLEAN-UP BUSINESS VALUE INSURANCE PRODUCT SALES CLAIMS 56 Main factors affecting exposure to environmentallyderived risks • The nature of environmental risks inherent in business activity of the client • The size and ter m of, and the security for, the transaction • The client’s ability and commitment to adequately manage these risks 57 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 ener g y 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 wor king safety in a company • making or g anisational improvements • improving environmental perfor m ance by the implementation of no-cost and low-cost measures from the company’s funds • reusing and/or recycling the maximum of primar y inputs and packaging materials conditions and occupational 58 Environmental investment opportunities • loans to enterp rises to finance required or desired investments in technologies resulting in direct and indirect environmental benefits • loans to municipalities to finance investments in environmental infrastru cture • loan guarantees to both enterp rises and municipalities for “soft” credits from national or re g ional environmental funds for environmental investments • loans to finance businesses environmental goods and ser v ices providing 59 What have we learned? • Th e CP approach reduces pollutant generation at ever y 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 • Th e 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 re gard ed as CP 60 Broader Application of CP CP is closely linked to: • Environmental Management Systems • Total Quality Management • Health and Safety Management 61 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 62 !!! CP is a jour n ey not a destination 63 “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) 64