INTRODUCTION TO

CLEANER PRODUCTION (CP)

CONCEPTS AND PRACTICE
For UNEP, Division of
Technology, Industry, and
Economics
Prepared by the Institute of
Environmental Engineering
(APINI) Kaunas University of
Technology, Lithuania
2
Contents
1. How did environmental strategies evolve?

2. What is CP?

3. How CP is applied in practice:
CP practices
Benefits and barriers
Procedures

4. What is CP contribution to main stakeholders?
Governments
Financial institutions

3
Course Objective
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
4
Passive environmental
strategies
Dilute & disperse
5
Reactive environmental
strategies
end-of-pipe approaches
6
Reactive environmental
strategies
On - site recycling
7
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 by-
product
- Product modification
8
What is waste?
There are literally hundreds words for
different types of waste:
greenhouse loss
hidden losses
leakage
non-conforming material
overfill
packaging
process loss
rework
second quality
stock loss
washings
and etc.
allowance
BOD
broke
contaminated
solids
core loss
customer returns
damage
draining
dust
effluent
evaporation
furnace loss
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Waste is waste what
ever you call it : take
the opportunity to cut
waste and increase
profits!
!!!
10
Cleaner Production Financing
The Cost of Waste Iceberg

THE HIDDEN COST
OF WASTE
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.
11
Where are you now?
Only a change
in technology
would eliminate
waste
completely
We are
optimising our
processes and
achieving big
cost reductions
Waste is
coming down as
we change the
way we work
We have
identified our
waste and
monitoring it
We plan to
reduce waste
Waste is cost
and regulatory
issue
Waste is only
disposal issue
Waste is not an
issue
12
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)

13
Continuous
Preventive
Integrated
STRATEGY for
Products Processes
Services
Risk Reduction
Humans
Environment
Cleaner Production Definition
14
always
reduces long-term liabilities which
companies can face many years
after pollution has been generated
or disposed at a given site
Properly implemented CP :
15
Properly implemented CP :
usually
increases profitability
lowers production costs
enhances productivity
provides a rapid return on any capital or
operating investments required
increases product yield
leads to the more efficient use of energy
and raw materials
16
usually (continuation)

results in improved product quality
increases staff motivation
relies on active worker participation in
idea generation and implementation
reduces consumer risks
reduces the risk of environmental
accidents
is supported by employees, local
communities, customers and the public
Properly implemented CP :
17
often
avoids regulatory compliance costs
leads to insurance savings
provides enhanced access to capital
from financial institutions and lenders
is fast and easy to implement
requires little capital investment
Properly implemented CP :
18
Cleaner Production principles
precaution principle
preventive principle
integration principle

19
How CP could be applied in
practice?
20
Cleaner Production practices
1. Good housekeeping

take appropriate managerial and
operational actions to prevent:
- leaks
- spills
- to enforce existing
operational
instructions
21
Cleaner Production practices
2. Input substitution

substitute input materials
- by less toxic
- or by renewable materials
- or by adjunct materials which
have a longer service life-time
in production
22
Cleaner Production practices
3. Better process control

modify:
- operational procedures
- equipment instructions
and process record keeping in
order to run the processes more
efficiently and at lower waste and
emission generation rates
23
Cleaner Production practices
4. Equipment modification

modify the existing production
equipment and utilities in order:
- run the processes at higher
efficiency
- lower waste and emission
generation rates
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Cleaner Production practices
5. Technology change

replacement of:
- the technology
- processing sequence
- synthesis pathway
in order to minimise waste
and emission generation
during production

25
Cleaner Production practices
6. On-site recovery/reuse

- reuse of the wasted materials
in the same process for another
useful application within the
company
26
Cleaner Production practices
7. Production of a useful by-
product

consider transforming waste into
a useful by-product, to be sold
as input for companies in
different business sectors.
27
Cleaner Production practices
8. Product modification

modify the product
characteristics in order:
- to minimise the environmental
impacts of the product during
or after its use (disposal)
- to minimise the environmental
impacts of its production
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CP versus End-of-Pipe
approach
Cleaner Production


Continuous improvement


Progress towards use of closed loop
or continuous cycle processes


Everyone in the community has a
role to play; partnerships are
essential

Active anticipation and avoidance of
pollution and waste

Elimination of environmental
problems at their source

Involves new practices, attitudes
and management techniques and
stimulates technical advances
Pollution Control and Waste
Management

One-off solutions to individual
problems

Processes result in waste materials
for disposal a pipeline with
resources in and wastes out

Solutions are developed by experts
often in isolation


Reactive responses to pollution and
waste after they are created

Pollutants are controlled by waste
treatment equipment and methods

Relies mainly on technical
improvements to existing
technologies
29
What is not CP?
Off-site recycling

Transferring hazardous
wastes

Waste treatment

Concentrating hazardous
or toxic constituents to
reduce volume

Diluting constituents to
reduce hazard or toxicity
30
What are the benefits of
Cleaner Production?
Improving
environmental situation
Increasing
economical benefits
Increasing
productivity
Gaining
competitive
advantage
Continuous
environmental
improvement
31
CP barriers
Internal to the companies:

- Lack of information and
expertise
- Low environmental
awareness
- Competing business
priorities, in particular, the
pressure for a short term
profits
- Financial obstacles
- Lack of communication in
firms
- Middle management inertia
- Labour force obstacles

32

-Difficulty in
accessing
cleaner
technologies


-Difficulty in
accessing
external
finance
CP barriers
External to the companies:

The failure
of existing
regulatory
approaches
33
CP motivators and drivers
Internal to the companies:


- Improvements in productivity
and competitiveness

- Environmental management
systems and continuous
improvement

- Environmental leadership

- Corporate environmental
reports

- Environmental accounting
34
CP motivators and drivers
External to the companies:

- Innovative
regulation

- Economic
incentives

- Education
and
training

- Buyer
supplier
relations

- Soft loans
from
Financial
institutions

- Community
involvement

- International
trade
incentives
35
The role of
international organizations in CP
development
United Nations Environment Programme (UNEP)
United Nations Industrial Development
Organisation (UNIDO)
Organisation for Economic Co-operation and
Development (OECD)
World Business Council for Sustainable
Development (WBCSD)
Development Finance Institutions (DFIs)
36
Team for CP success
Managers, engineers and finance people in
industry and commerce, in particular those
responsible for business strategy, product
development, plant operations and finance

Government officials, both central and
regional, who play an important role in
promoting CP

Media representatives who play an
important role in disseminating information
on good environmental practice
37
Cleaner Production procedures
The recognized need
to minimise waste
Planning and
Organization
Assessment
Phase
Feasibility Analysis
Phase
Implementation
Successfully implemented CP projects
The first
step
The second
step
The third
step
The fourth
step
38
1. Planning & Organization
Obtain management
commitment

Identify potential barriers
and solutions

Set plant-wide goals

Organize a project team
39
2. Assessment
Identify sources

Identify waste/
pollution causes

Generate possible
options
40
Material and energy balances
The Industrial
Process
Heat Power
The
Energy
Balance
Cooling
Raw
Materials
Products
& Waste
The
Mass
Balance
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Why are material and energy
balances so important?
The material and energy balances are not only
used to identify the inputs and outputs of mass
and energy but their economic significance is
related to costs, such as:
cost of raw material in waste
cost of final product in waste
cost of energy losses
cost of handling waste
cost of handling waste
cost of transporting waste
cost of solid wastes disposal
cost of pollution charges and penalties
42
Possible causes for waste
generation
Process
Management
Planning &
Information
Systems
Personnel
Skills &
Motivation
Wastes &
Emissions
Choice &
Quality of
Input Materials
Technical
Status of
Equipment
Choice of
Production
Technology
Process
Efficiency
Product
Specifications

43
Option generation (1)
Creative Problem Solving (CPS):
- Find facts
- Identify the problem
- Generate ideas to solve the problems
- Define criteria to be used to select solutions/ideas

Screening of ideas / options:
- Select all ideas/options that may be implemented immediately
- The remaining options/ideas should then be divided into three boxes:
- Good housekeeping
- Interesting options but more analysis is needed
- Waiting box + Rejected

Weighted sum method to prioritise options in second group:
- What are the main benefits to be gained by implementing this option?
- Does the necessary technology exist to implement the option?
- How much does it cost? Does it appear to be cost effective, meriting
in depth economic feasibility assessment?
- Can the option be implemented within a reasonable timeframe without
disrupting production?
44
Option generation (2)
Traditional brainstorming

Formulate problem (problem
identification)
Define objective of the
brainstorming session
Follow the rules of brainstorming:
- Select a secretary to write down
all ideas (The secretary can't take
part in the idea generation)
- Select a group leader (the group
leader shall control that the four
main rules are followed)
Close the idea generation after
30-40 minutes

45
CP assessment practices
Process
On-site
Recovery/
Reuse
Production of
Useful
By-Product
Product
Modification
Equipment
Modification
Input
Substitution
Good
Housekeeping
Technology
Change
Better Process
Control
46
3. Feasibility Studies


Preliminary evaluation
Technical evaluation
Economic evaluation
Environmental evaluation
Selection of feasible options
47
Capital investment
Annual operating cost savings
Payback Period
- period of time
(years) needed to
generate enough
cash flow to
recover the initial
investment
Payback period =
_____________________________
48
4. Implementation &
Continuation


Prepare a CP plan
Implement feasible CP measures
Monitor CP progress
Sustain Cleaner Production
49
CP attacks the problem at several
levels at once. The implementation
of an industry/plant level
programme requires,
- the commitment of top management
- a systematic approach to CP in all
aspects of the production processes

50
Marketing
Top management
commitment
Pre-assessment
CP policy
declaration
The continuous
CP loop
Assessment
Start CP project
Project organization
CP options
Feasibility analysis
Assessment report
Project implementation
Measure progress
Final report
Top Management reviews
CP management system
51
CP and main stakeholders
52
How can governments
promote CP?
Applying regulations
Using economic instruments
Providing support measures
Obtaining external assistance
53
CP applicability for local
governments
Corporate decision-making
Local environmental management strategies
Community and industry partnerships
Sustainable economic development
Public environmental education
Specific local environmental
problems
Local environmental
monitoring
54
CP and financial institutions
Environmental evaluation can help:
Establish an exclusion list
Identify environmental
risks in every project
Understand the financial
institutions exposure to
environmental risks and
liabilities
Monitor the environmental
risks of transactions and
respond
Evaluate risks and
liabilities in foreclosure or
re-structuring activities
55
What are the benefits of
Cleaner Production?
Financial advantages:

Usually a short 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
56
Overall Risk Profile
RISKS
ENVIRONMENTAL
ACCIDENTS
WORKERS
HEALTH
CONSUMERS
HEALTH
NEW
REGULATIONS
REPUTATION
BUSINESS VALUE
INSURANCE
CLAIMS
LIABILITY
CLEAN-UP
PRODUCT SALES
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Main factors affecting
exposure to environmentally-
derived risks
The nature of environmental risks
inherent in business activity of the
client

The size and term of, and the security
for, the transaction

The clients ability and commitment
to adequately manage these risks
58
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 energy
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 working conditions and occupational safety in
a company
making organisational improvements
improving environmental performance by the
implementation of no-cost and low-cost measures from
the companys funds
reusing and/or recycling the maximum of primary inputs
and packaging materials
59
Environmental investment
opportunities
loans to enterprises to finance required or desired
investments in technologies resulting in direct and
indirect environmental benefits

loans to municipalities to finance investments in
environmental infrastructure

loan guarantees to both enterprises and
municipalities for soft credits from national or
regional environmental funds for environmental
investments

loans to finance businesses providing
environmental goods and services
60
What have we learned?
The CP approach reduces pollutant generation at every
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

The 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 regarded as CP

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Broader Application of CP
CP is closely linked to:
Environmental Management
Systems
Total Quality Management
Health and Safety
Management
62
Cleaner Production and
Sustainable Development
Responsible
Entrepreneurship
Eco-efficiency
Cleaner Production
Compliance
Government
Agenda
Business
Agenda
ICC
Charter

EMS
EHS
Auditing
Sustainable
development
Agenda 21
Factor X
Environmental
space
Time
Sustainability
Economic Instruments
Co-regulatory agreements
Command & control
63
!!!
CP is
a journey
not a
destination
64
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)