ZOA Communications and Government Relations BASF Group BASF Positions on Political Issues

March 2011

Energy and Climate Policy Product Carbon Footprint

BASF helps to actively develop methods for the Carbon Footprint and recommends the use of the established Eco-Efficiency method, in which the Carbon Footprint is also considered as one aspect. A Product Carbon Footprint (PCF) is the sum of the greenhouse gas emissions that a product causes in the course of its whole life cycle. It is being discussed in politics, industry, science and the public as an instrument for providing information about the effect that products have on the climate. The determination, assessment and communication of Carbon Footprints, the CO2 footprint, of products are currently the subject of public discussion. The aim is to help customers to decide which products they should purchase and consume so that the impact on the environment is minimized. The process of Product Carbon Footprinting can assist companies to obtain transparency about their greenhouse gas emissions along their valueadding chain and identify potential for reductions. BASF is taking an active role in this discussion. BASF basically advocates environmental assessments that draw up a complete ecological picture with comprehensive criteria. In addition, these should take into consideration economic and if possible also social criteria for assessing the sustainability. The so-called Carbon Footprint is part of the complete life cycle assessment. The data on CO2 emissions and other greenhouse gases only make sense for our customers and the end consumers if they are seen and assessed in connection with other ecological factors as for example energy consumption, raw material consumption, various emission categories, ecotoxicity, water consumption, area requirement and economic criteria. The assessment should take all the individual results into account and provide a clear and readily understandable statement on the sustainability of products. Climate-related product optimizations must not be carried out at the expense of other environmental categories. BASF emphatically recommends that the effects of products on the environment must be assessed over the whole life cycle. Our experience shows that only considering the production phase of products is much too restricted. Only a correct, uniform definition of the system limits and the complete life cycle assessment taking the use phase into account and including the disposal enables products to be compared and can show our customers the right options for action. The method for establishing a Carbon Footprint should permit both the use of selfgenerated data and average data. It must be possible to collect and assess data practicably and sensibly. Average values, for example produced by associations, are an important element for reducing the effort required to establish Carbon Footprints. BASF emphatically recommends a uniform procedure in the communication of Carbon Footprint results. The publication of data must be clear, understandable,

informative and verifiable. Product labeling must only contain information that has been correctly obtained and completely assessed. The ecological information, including the Carbon Footprint, provided on end consumer products must be checked and confirmed by independent third parties (Critical Review) before they are published. In BASFs opinion, the communication of a Carbon Footprint as an aggregated indicator, for example in the form of a Carbon Label on products, does not make sense. There is not currently any uniform approach to the labeling of the climate friendliness of products. As we see it, the sole communication of an aggregated CO2 gram number as in the case of a Carbon Label as product labeling is neither adequate nor meaningful. The methodological principles have not yet been standardized; in addition the results show numerous uncertainties and variances as well as scope for interpretation, which will still remain if there is a standardized method. Therefore it is not possible to compare products meaningfully using a single ecological parameter. Even after the scope for interpretation has been clarified, Carbon Labels will only make sense if customers receive the information that is actually relevant to how they act, in other words if they can use this information to choose between various products with similar uses and make a significant contribution to the reduction of greenhouse gases as the result of this choice. Furthermore, the whole ecological relevance must be taken into account in the selection process. There are already valid approaches for the assessment of greenhouse gas relevance for some groups of products (for example the energy consumption labeling for electrical equipment). These should be retained. We introduce our know-how obtained from the development of instruments for assessing sustainability into the discussion about Product Carbon Footprints. The ecobalance methods developed by BASF (Eco-Efficiency aAalysis and SEEBALANCE) additionally include social and economic aspects. In more than 450 studies since 1996, BASF has developed extensive methodological competence on this.

You will find further information on the issue of Eco-efficiency Analysis and Carbon Footprint under BASF Eco-Efficiency Analysis Contact: Dr. Peter Saling (GU/NE, phone: +49 621 60 58146 Email : peter.saling@basf.com