Sustainable Approaches Industrial Ecology and Pollution Prevention Chapter 22 © 2007 Thomson Learning/South-WesternThomas and Callan, Environmental Economics

2 Sustainable Approaches How to achieve sustainable development? Industrial Ecology: a systems approach Pollution Prevention (P2): a front-end strategy

Industrial Ecology

4 Overview Industrial ecology refers to a multidisciplinary, systems approach to the flow of energy and materials between production and the environment Main objectives To promote ways to use recycled waste from one production process as inputs in another process To optimize material flows (i.e., achieve an efficient use of materials and energy in production) Some argue that industrial ecology is the means by which a society promotes sustainable development Since flow of materials is integral to industrial ecology, the materials balance model should be revisited

Materials Balance Model Revisited At issue is whether the flow of materials from nature through the economy is linear, (i.e., operating in only one direction), and open OR cyclical and closed Source: Adapted from Kneese, Ayres, and D'Arge (1970).

A Linear (or Open) Materials Flow This “cradle-to-grave” open flow assumes materials run in ONE direction, entering as resources and leaving as wastes or residuals. Policy focus would have to be aimed at abating contaminants ONLY at the end of the flow. Source: U.S. Congress, OTA (October 1992), as cited in Gibbons (September/October 1992), p. 31.

7 Linear Flow Policy based on a linear flow assumption does not fully address the long-run implications of pollution, i.e.,… Nature’s capacity to convert matter to energy is limited, so this limited conversion affects future generations Relying on abatement after the fact uses up resources that eventually are added to the residual (waste) flow Command-and-control policy based on this approach generally runs counter to economic growth, which causes intertemporal trade offs from one generation to another Solution should consider a cyclical flow approach

8 Cyclical (or Closed) Materials Flow A cyclical flow assumes that… productive activity can be altered throughout the cycle to reduce environmental effects  e.g., product design, manufacturing processes, energy use residuals (i.e., wastes or pollution) can be brought back into useful production Implies that policy can be aimed anywhere in the cycle of production and consumption rather than only at “end-of-pipe”

Closed System of Materials Flow A “cradle-to-cradle” flow that assumes materials run in a circular pattern in a closed system that allows residuals (or wastes) to be brought back into the production process. Source: U.S. Congress, OTA (October 1992), as cited in Gibbons (September/October 1992), p. 31.

10 Using a Cyclical Flow in Practice Life Cycle Assessment (LCA) Industrial Ecosystems

11 Life Cycle Assessment (LCA) Used to examine the environmental impact of a product or process at all stages from resource use to disposal Comprises 4 components Goal definition and scoping: describes the product and environmental effects to be assessed Inventory analysis: analyzes resource usage and environmental releases Impact analysis: determines human & environmental effects Interpretation: evaluates results and selects product/process Addressed by ISO International StandardsISO International Standards Voluntary standards in environmental management aimed at giving countries a common approach to environmental issues

12 Industrial Ecosystems A Real-World Closed System Wastes from one production process are used as inputs in another Usually implemented through a collaborative of several firms, an eco-industrial park Real-world examples include systems in… Kalundborg, Germany Choctaw, MS

Pollution Prevention (P2)

14 Overview Pollution prevention is a long-term, front-end strategy aimed at reducing or eliminating the toxicity and/or the amount of residuals at their source Adopts the cyclical materials flow and LCA, just as industrial ecology does Preventive objectives Source reduction: reducing pollutants at point of generation Toxic chemical use substitution: substituting less harmful chemicals for toxic ones

15 How P2 Differs from Industrial Ecology P2 promotes risk reduction by eliminating or minimizing wastes, while industrial ecology uses wastes as inputs P2 solutions are aimed at a single firm, while industrial ecology is used by a collaborative of firms P2 does not view recycling as preventive, while industrial ecology views recycling as the solution P2 generally requires government oversight, while industrial ecology does not P2 uses efficiency as a means to an end, while industrial ecology views efficient resource use as an end in itself

16 P2 Techniques Source segregation Keep hazardous waste from mingling with nonhazardous waste Raw materials substitution Use inputs that result in little or no hazardous waste Changes in manufacturing processes Use methods that generate fewer hazardous by-products Product Substitution Use relative safe goods instead of polluting products

17 P2 Legislation National Environmental Policy Act (NEPA) Among its express purposes is to encourage efforts to prevent environmental damage Integrates pollution prevention into U.S. environmental legislation Pollution Prevention Act of 1990 One provision states that P2 is the primary objective: “pollution should be prevented or reduced at the source, whenever feasible” The secondary objective is management of residuals through recycling, treatment, and disposal – in that order Similar legislation exists in other nations, including the EU, Canada, Australia

18 Pollution Prevention Hierarchy SOURCE REDUCTION RECYCLING TREATMENT DISPOSAL

Selected Corporation Examples of P2 Initiatives Eastman Kodak By 2001, achieved a 42% emissions reduction of 30 priority chemicals and a 12% reduction in CO 2 emissions, as compared to 1997 levels E. I. DuPont In 2003, reduced worldwide GHG emissions by 72% relative to 1990; global emissions of air carcinogens in 2003 declined by 90% relative to 1987; hazardous wastes in 2003 were 42 percent below 1990 levels Anheuser-Busch Companies, Inc. Between 1990 and 2000, reduced VOC emissions by 88%, water pollutants by 82%, and solid wastes by 24%. P2 accounted for 55% of the VOC reduction, 43% of the effluent reduction, and 76% of solid waste reduction Sources: E.I. Du Pont de Nemours and Company (2005); Eastman Kodak Company (2001); U.S. EPA, Office of Solid Waste and Emergency Response (October 2004).

20 Economics and P2 Cost-effectiveness as a criterion Whether a firm adopts P2 will depend in part on its cost relative to other options, like treatment or abatement If P2 is chosen, cost-effectiveness can guide the selection of the appropriate strategy Efficiency as a criterion Benefit-cost analysis can be used to determine the extent to which a P2 strategy is implemented

Sustainable Initiatives and Programs Changing How Firms Set Strategies

22 Three Emerging Initiatives Extended Product Responsibility (EPR) Design for the Environment (DfE) Green Chemistry Program

23 Extended Product Responsibility (EPR) Refers to efforts aimed at identifying and reducing life- cycle environmental effects of products Sometimes called Product Stewardship Underlying premise is that all participants in the product chain—designers, manufacturers, distributors, consumers, recyclers, remanufacturers, and disposers—are responsible for a product’s effect on the environment Involves raw materials selection, production impacts, product use, products at end-of-life (i.e., take-back programs to achieve recycling or remanufacturing)

24 Design for the Environment (DfE) Promotes using environmental considerations with cost and performance in product development and design Directly uses a cyclical flow of materials Used by BMW, Dell Computer, 3M, and others

25 Green Chemistry Program Promotes development and use of chemical technologies that achieve pollution prevention Sometimes known as benign chemistry or sustainable chemistry programs Recognizes the importance of a product’s life cycle in pollution prevention Seeks safer alternatives to hazardous chemicals, resulting in lower risks, safer production processes, and final products that pose less of a threat at the end of their economic lives

Global Information Sharing

27 Technology Transfer Refers to the advancement and application of technologies and strategies on a global scale Is considered critical to consistent progress toward sustainable development Relies on interdependent factors that include research, physical capital investment, communication, financial resources, education

28 Achieving Environmental Literacy Refers to an awareness of the risks of pollution and natural resource depletion Promoting environmental education worldwide has grown and was an important theme at the Earth Summit in Rio Agenda 21 specifically refers to the importance of education, public awareness, and training to implement the global agenda

29 Earth Summit in Rio Preamble of Agenda 21 “Humanity stands at a defining moment in history. We are confronted with a perpetuation of disparities between and within nations, a worsening of poverty, hunger, ill health, and illiteracy, and the continuing deterioration of the ecosystems on which we depend for our well-being. However, integration of environment and development concerns and greater attention to them will lead to the fulfillment of basic needs, improved living standards for all, better protected and managed ecosystems and a safer, more prosperous future.” Source: United Nations, Division for Sustainable Development, ch. 1, paragraph 1.1 (June 29, 2000.)