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Module 3
A Closer look at Cleaner Production
June 3, 2013
Malolos City
Prof. Nonita T Yap, SEDRD
University of Guelph Canada
Cleaner production
5. Reuse & recycle waste
2. Reduce at source
3. Modify process 6. Substitute
product
4. Substitute inputs / Reformulate materials
7. Change technology
1. Good housekeeping
CP
tech
niq
ues
3
Approach How Reqts 1. Good Housekeeping
Preventing leaks and spills, instituting preventive maintenance
schedules, regularly checking equipment, making sure employees follow official work procedures.
Attention and time
2. Input Substitution
Substituting one or more less expensive, less dangerous, or more efficient input material for an existing input material.
Technical expertise
3. Process Modification
Changing working procedures, machine instructions, and process record keeping to increase throughput, reduce waste, and/or improve product quality.
Understanding of process
4. Equipment Modification
Changing the existing process equipment to increase throughput, reduce waste, and/or improve product quality.
Understanding of how equipment works
5. Product Modification
Changing the characteristics of a product to increase throughput, reduce waste, and/or improve product quality or durability
Technical expertise
6. Resource Recovery and Reuse
Capturing and reusing onsite, materials that were previously wasted.
Understanding of process
7. Off site
recovery and reuse Identifying an end market and marketing a material formally considered waste. May involve changes in processing of original product or new processing steps to transform waste.
Knowledge of production chain
8. Technology Change
Replacing the existing technology, changing the order of process steps to in to increase throughput, reduce waste, and/or improve product quality.
Capital cost
5- sigma
Audit andEducation
ProductReformulations
PHASE II (SOME ROI)
PH
AS
E III (L
ITT
LE
RO
I)
PH
AS
E I
(B
IG R
OI)
OP
ER
AT
ION P
RO
CE
SS
EQUIPMENT
WasteReduction
Waste
SegregationProcess
Changes
ComplexRecycling and
Refining or Reuse
SimpleRecycling
EquipmentModifications
Process
Control
Source
Treatment
GoodHousekeeping
(Mops and Sops*)
Raw Materialand Catalyst
Changes
Cle
an
er p
rod
uct
ion
str
ate
gie
s NOT ALWAYS TRUE – BIGGEST
WINNER FOR 3M
What is waste?
6
Efficiency = the reduction of waste
?
“Waste is any material or
energy leaving the facility. . .”
Proactive
definition
Less strict
definition
“. . .not as part of the product.”
“… without first being used as
efficiently as possible.”
7
Definitions of
waste vary, but
ALL companies
generate waste as
part of their
operations.
!
Cleaner
production tools
assist business by
asking the 3
questions
8
Materials
Energy
Water
By-Products
Solid
Waste
(trash)
Air Emissions
Products
Heat
Loss
Hazardous
Waste
Waste-
water
INPUTS
WASTES
WASTES
Allowance breakage contaminated solids core loss customer returns damage
drainings dust evaporation furnace loss greenhouse loss hidden losses leakage
overfill non-conforming material packaging process loss rework second quality
stock loss washings
Waste comes in
many forms. . .
. . .and has many
different sources
The true cost of waste can
be like a crocodile,
with only a small part
visible
10
See “the cost iceberg” in: 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.
For every $1 of waste cost measured, another $2 - $3 of cost are “hidden” in the accounting records, or are not on the books at all
Companies typically underestimate how much waste really costs them, sometimes by several orders of magnitude
This applies even to big, well-managed companies too! 11
All waste has a cost—but the cost of some types of waste is far more significant than others.
Reducing waste saves these costs—but may also require initial investment and effort
Therefore, assessing the costs of waste it is essential to:
12
Identify the key
problems
that CP can address
Evaluate whether CP
measures are good
business decisions.
or ?
OVERVIEW: 1. Use process mapping as a tool to
understand flow of materials, energy, and waste
2. Assess costs to identify areas for efficiency improvement
3. If necessary, use Root Cause Diagnosis or Fishbone Diagram to figure out WHY a problem exists
4. Use option generation techniques to identify possible CP solutions
13
2
ID
oppor-
tunities
Prioritize
Evaluate Implement
Measure,
review
Get
organized
We will learn
about each of
these tools
Waste imposes costs
But problematic accounting practices hide its true costs
14
A. “Hidden” in the
accounting records
B. Misallocated from
overhead accounts
C. Mis-classified as fixed
when they are really
variable, or semi-variable
D. Not found in the
accounting records at all
Costs can be. . .
(Can you think of others?)
Manufacturer of high-end aluminum furniture
15
2%52%
per accounting
records
actual
MATERIAL LOSSES (as % of input)
Adapted from: Rooney, Charles. “Economics of Pollution Prevention:
How Waste Reduction Pays.” Pollution Prevention Review.Summer 1993.
Engineering
specification allowed
50% waste;
accounting records
only showed
waste/loss in excess
of specification
How did this happen?
A dairy cooperative in India (packaging milk in 1-liter plastic bags)
16
The amount of
plastic
‘pouches’
purchased
The amount of
final product
shipped
Accounting
records showed: ! Accounting records
did NOT show:
The amount of
solid scrap
waste generated
The amount of
any other lost
raw materials,
e.g., milk
The goal of Cleaner Production is to reduce variable costs (or prevent end-of-pipe fixed costs)
17
Therefore,
it is important to correctly
distinguish between fixed
and variable costs when
identifying and estimating
costs to support CP efforts
“If CP efforts
will reduce a
cost — then it is
variable!”
In general, as you go down this list, costs are more likely to be hidden or difficult to quantify.
(but every case is different!)
18
LESS
HIDDEN
MORE
HIDDEN
Equipment purchase,
direct materials, energy, labour
Waste disposal
Recycle/rework, treatment,
waste handling
Regulatory compliance,
other indirect costs
Company image, credibility
First, check the general
ledger & production
records to obtain all available
information about costs and
quantities of inputs and
outputs
19
The general ledger
[i.e., accounting
record]
contains only
external
transactions, not
internal flows
between
departments or
production steps.
It will show inputs
purchased and
goods sold.
However, physical
quantities (kg,
litres, kwh) of
inputs purchased
are often not
recorded.
Production
records contain
the volume of
goods produced
SOMETIMES, they
include
information such
as physical
quantities of
inputs used and
number of
rejected products.
1
20
Step 2 of the CP Process:
Identification of CP opportunities
FOCUS: process mapping
Module 3:
A closer look at CP
process and
tools/techniques for CP
implementation
ID
oppor-
tunities
Prioritize
Evaluate
Select
Implement Measure,
review
Get
organized
NO. Micro-enterprises rarely have any process documentation.
Small enterprises usually keep separate documentation by department or machine.
There is rarely documentation that makes connections between all process steps.
21
! Sophisticated SMEs
may have information
in the form of Flow
charts, Value stream
maps, Process and
instrumentation
diagrams, Machine
configurations, Arrow
diagrams, Box
diagrams, Floor plans,
etc. All are complex;
none replace a basic
process diagram!
22
Process maps. . .
Are a key tool for understanding the
production process
Makes relationships between
operations visible and lead to a
systems view of the business
Can be used to keep track of both
quantities of inputs and outputs
AND costs
Are extremely useful for helping
communicate CP opportunities to
management & all departments
Making a process
map is therefore
an essential part of
the identifying CP
opportunities.
23
PRODUCTION PROCESS /UNIT
OPERATION
OUTPUTS INPUTS
Water, air
Environmental resource
Equipment
Raw materials
Energy
Labour
Product (s)
By products
EXAMPLE
Other chemicals
Wastes. emissions Recycling?
INTEGRITY – all revelant environmmental impacts of the operations should be listed.
TRANSPARENCY /OBJECTIVITY – All the flow of materials and energy should be registered objectively
CONTINUITY – time period should be equal for all the areas (e.g., 1 yr)
PRACTICALITY/EFFICIENCY – to utilise all resources (time personnel, expenditures) register only the material and energy that are ecologically relevant
CONFIDENCE – the data collected should lead to plausible results
CLARITY – The results are unequivocal and useful from the perspective of decision making.
25
1 - Transport • Animals delivered in
trucks;
• Trucks are washed
2 - Holding &
Inspection • Animals are held in pens
& inspected.
• Condemned animals are
separated and killed.
fuel
Animals
dead on
arrival
Faeces, urine,
contaminated
water
Condemned
animals
water
Live
animals
Live
animals
Faeces, urine,
contaminated
water
water
Incineration
Wastewater treatment
26
4 - Evisceration & Splitting • Abdomen cut open & viscera removed
• Breastbone split
• Heart/liver/lungs removed;
• Head removed
• Carcass cut into two along the spine
• Hide removed
Energy (to sterilize
equipment)
Wastewater
Water
Intestines,
edible organs
Hides
Inedible offal & Parts
3 -
Stunning
& Bleeding Animals are first
stunned or killed,
and then bled
Carcass
blood
Faeces, urine,
contaminated
water
Water Disinfectant
Wastewater treatment
Carcass
Disinfectant
Condemned parts
Incineration
27
5 -
Chilling Carcasses
refrigerated
overnight
water
wastewater
Energy (for
refrigeration)
6 - Cutting
& boning Carcasses are cut
into pieces for
retail, some bones
removed
7 -
Packaging
Energy (to sterilize
equipment &
refrigeration)
water
Bones
fat
Meat Carcass
Energy (to sterilize
equipment &
refrigeration) water
Leaks of refrigerant fluids (Ammonia, CFCs
Wastewater treatment
28
Incineration Condemned animals
and parts
Rendering Parts and scraps
are rendered for
tallow
?
Waste treatment
processes
Secondary production
processes
And what other processes?
?
? ?
? ? ?
? ?
Some secondary production processes
List all the activities in your facility – including intermittent activities
Develop a process map of your facility
Be prepared to present your results to your peers
29
30
Step 2 of the CP Process:
Identification of CP opportunities
FOCUS: Root cause analysis
Module 3:
A closer look at the CP
process and
tools/techniques for CP
implementation
ID
oppor-
tunities
Prioritize
Evaluate Implement
Measure,
review
Get
organized
Now, you have ◦ Gathered cost information ◦ Made a process map
As a result: you understand the costs of waste & have identified key inefficiencies/ problems.
But: no solution is possible without understanding the CAUSE of the problem(s).
31
Sometimes, the cause
of the problems is
clear.
Sometimes it is not !
THE WHY QUESTION
A fishbone (Ishikawa) diagram
it divides all causes into four categories:
Possible causes in each category are then systematically identified.
ALTERNATIVELY or in addition: Do a Critical points analysis – e.g., HACCP in food industry
33
Materials
is a simple tool for identifying
the true causes of a problem.
Machinery
Manpower Methods
A CP analysis of a bakery identifies BURNED BREAD as the main problem.
Burned bread is a waste with high costs!
◦ Cost of inputs (flour, yeast, sugar, etc.)
◦ Cost of labor to make the bread ◦ Cost of fuel for the oven ◦ Lost profit ◦ And. . . If the incidence of burned
bread is reduced, the business can expand without buying a bigger oven!
34
CLASS
EXERCISE
Identifying CP options requires
understanding the cause of the burned bread
problem.
We start by identifying Sunrise’s:
35
CLASS
EXERCISE
materials
machines
people
methods
Flour +
Oven + ??
Employees
Bread recipes + ??
Now, we draw our “fishbone diagram”. . .
36
Burned bread
Machinery Material
People Methods
Oven
Pans
Door seals poorly so
oven heats unevenly
Some pans are
blackened
. . .and identify possible causes in each category.
flour
Poor
Training
New
supplier
New staff
Oven repair
manuals
Print hardly legible
Waste Problem
Once you have identified possible root causes, how do you know which one(s) are real? ◦ In a real situation, those who
know the process best should participate in making the “fishbone diagram”
◦ Questions can be resolved by talking to employees and observing the production process
38
The key lies in …
40
Keep in mind the
80/20 rule (20% of
causes account
for 80% of
problems), so
focus on the big
issues and avoid
dwelling on
smaller items
Often, people focus
on the obvious
solution rather than
best solution.
Identifying root
causes helps to
identify solutions that
solve the problem at
the source.
Identify the waste of biggest concern in your enterprise – environmental or financial
Identify the various causes of the waste using a fishbone diagram
Be prepared to present your results.
41
1. Remember the “Pareto Principle” (or the “80/20 rule”)
2. DO prioritize both short-term & long-term opportunities. . .
3. BUT, implement “low hanging fruit” FIRST
42
How do you prioritize strategically?
Consistently, about 20% of
improvement opportunities
provide approximately 80%
of cost savings. Look for
this 20%!
CP opportunities that are
easy and low-cost to
implement, and which
provide appreciable cost
savings almost immediately.
Use these immediate
successes to build support
for longer-term CP efforts.
LOW-HANGING FRUIT are
43
Sources of non-product loss
To
tal c
os
t* b
y s
ou
rce
*total cost=purchase, disposal & management costs
of material purchased but disposed of as waste
A & B account for about
80% of the total costs of
non-product loss
44
“Experience shows that
for the smallest
enterprises, simple
payback of a year or
less is a good rule of
thumb.
Assume that we have evaluated
the potential CP opportunities
from a financial perspective.
However, financial considerations are only one element
of deciding to implement a
project
45
How do you
weigh all these
considerations?
? Technical
Financial
Organizational
Regulatory
A number of decision-making aides for prioritizing CP options exist
However: Decision-making aides can’t make a decision for you! They can only facilitate systematic consideration of the issues involved.
46
!
Some examples
Waste is inefficiency and imposes many costs on businesses. Its true cost is often hidden.
47
Via the CP process, we
identify the true costs
of waste, prioritize
problems and CP
options, and implement
these priorities
systematically.
Measure &
review
1
2
3
Get
organized
Identify CP
opportunities
Evaluate
&Prioritize
Implement4
5
Start with the Production Process
TECHNOLOGY
INPUT
MATERIALS
OPERATION
PRODUCTS PRODUCTION
PROCESS
WASTE &
EMISSIONS
Option 1: Good operation practices
TECHNOLOGY OPERATION
PRODUCTS
PRODUCTION PROCESS
> Production scheduling
> Energy management (peak shaving)
> Good working instructions and procedures
> Training and incentives program
> Adequate process control operations
> Proper maintenance and cleaning WASTES &
EMISSIONS
INPUT MATERIALS India dairy
milk souring
Philippines crab processing plant
Philippine canned laing
producer
Option 2 &5: reduce, reuse and recycle
TECHNOLOGY OPERATION
PRODUCTION PROCESS
2& 5/ On-site reuse & recycle: > On site reduction, recycling & re-use of raw
materials in the process, waste water, waste
heat and cooling water
> Transforming waste into useful by-products
> Waste segregation and storage WASTES &
EMISSIONS
PRODUCTS
INPUT MATERIALS India dairy broken plastic bags & WTP sludge
- impact on microclimate
Option 4: Input material substitution
TECHNOLOGY OPERATION
PRODUCTS
PRODUCTION PROCESS
WASTES &
EMISSIONS
> Replacing toxic or harmful materials
with less toxic > Use of renewable or
recycled materials > Use materials with
longer lifetime > Material purification
INPUT MATERIALS
Malawi Bata Shoes and foreign currency: trading
of old plastic shoes– melted back ,
retransformed to resin
PRODUCTS
Option 6: Product modification
TECHNOLOGY OPERATION
PRODUCTION PROCESS
> Recycling-friendly design
> Product life extension
> More efficient, less material
intensive packaging
> Reduction of harmful substances.
WASTES &
EMISSIONS
INPUT MATERIALS
Removal of lead from wine lids
Thinner plastic water
bottles
Option 3&7: Process &
Technology change
TECHNOLOGY
OPERATION
PRODUCTS
PRODUCTION PROCESS
> Replacing equipment
> Equipment modification
> Optimising process conditions
> Increased automation
> Improved process control
> Improved equipment lay-out
WASTES &
EMISSIONS
INPUT MATERIALS
Zimbabwe metal plating plant: placing rinse baths closer
with drip pans at angles
Car body painting -
powder coating instead
of conventional air
atomized spray