ik kim and tak hur konkuk university, korea an attempt to measuring green productivity 2 nd apo...

Ik Kim and Tak Hur

Konkuk University, Korea

An Attempt to MeasuringGreen Productivity

2nd APO World Conference on Green Productivity 9-11 December 2002. Edsa Shangri-la, Manila, Philippines

Eco-efficiency

recognized as “one of the primary way in which business can contribute to the concept of sustainable development”.

Countries or companies engaging in the eco-efficiency revolution will become stronger in international competitiveness.

This recognition led to the development of Green Productivity (GP) program of the Asian Productivity Organization (APO) in 1996.

I. IntroductionII. Green Productivity IndicatorIII. Case StudyIV. Conclusions

Measurement of GP is important in order to

evaluate the GP performance of a company or product.

Needs for GP Indicators which analyze both

environmental and economic aspects in an integrated

fashion.

Green Productivity (GP)

A strategy for enhancing productivity and environmental

performance for overall socio-economic development


The measurement framework of GP is discussed.

GP Indicators ;

GP Portfolio

A case study of polystyrene(PS) production system of a Korean company is provided to illustrate the applicability of the GP indicators.

In this study


GP Index

GP Ratio

Productivity;

- Conventional Concept; the ratio of output to input

- Recently; the efficiency with which outputs are produced

GP is in line with Eco-efficiency !!!

- Total productivity = Total output / Total input

- Partial productivity = Total output / Partial input

GP = Productivity / Environmental Impacts


What to measure?How to measure?

- global level - national level - sectoral level - company level - factory level - each product level - material level - process level

I. IntroductionII. Green Productivity IndicatorIII. Case StudyIV. ConclusionsGP Measurement

• production rate

- total no. of products/time

- total mass of products/time

• mass of products/mass of raw materials

• price/cost

• profit/cost

• total sales/year

• total profit/year

• return of investment/year

Productivity at product level


Green (denominator)

• environmental impact (ex) ecoindicator,…

• LC(CO2)• LC(energy)• LC(water consumption)• total material consumption• total material intensity• total energy consumption• total energy intensity• land use• ecological footprint


SP : Selling Price LCC : Life Cycle Cost EI : Environmental Impact.

- The economic value created from the input of life cycle cost divided by environmental impact

GP Index = Productivity/Environmental Impact

=SP($) / LCC($)

EI

- To measure and compare the level of GP for a product or service with currently competing equivalent products or services

GP Index


GP Ratio

- GP ratio is not defined as the ratio of the GP indices of the existing and new systems.

- GP ratio is designed for internal managerial decision- making, considering both costs or profits over time and environmental impacts.

- If GP is larger than one, a new system is better than the existing one from the perspective of GP.

cur

curcur

alt

altalt

EIPCSP

EIPCSP

RatioGP/

/

alt

cur

altcur

curalt

EI

EI

PCSP

PCSP


Green Productivity Portfolio;

The ratio of environmental impact between the current

and alternative is plotted against the ratio of the

productivity between the current and alternative.


altcur

curalt

PCSP

PCSPRatio of Productivity =

alt

cur

EI

EIRatio of Env. Impact =

GP Portfolio


Ratio of Productivity

Rat

io o

fE

nv.

Im

pact

1.0

1.0

I

III

II

IV; Current Process

E

P

I

II

III

IV

: Environmental Performance

: Productivity

; E (good), P(good)

; E (good), P(poor)

; E(poor), P (poor)

; E(poor), P(good)

1. Life Cycle Assessment

2. Total Cost Assessment

3. GP Indicators


III. Case Study

1. Life Cycle Assessment

Goal of this study understand the environmental aspects of the PS production

in company A and identify the improvement opportunities. assist decision-making between the improvement

alternatives.

Scope of this study System boundaries

- from crude oil extraction to PS resin production Functional unit (Reference flow)

- 1ton of PS product

1.1 Goal and Scope Definition


1.2 Life Cycle Inventory Analysis

Polymerization unit

Storage&packaging unit

Pelletization unit

Devolation unit

Coal

Gas

Etc.

Wood

Water

Crude oil

PW

CN

CA

Stm

Elec

PE

WWT

SM

Pap

System boundary

PS

Co-product

Raw Material Extraction toGate Gate to Gate Gate to User to Disposal

•SM(Styrene monomer), Elec(Electricity), Stm(Steam), PW(Process water), CA(Compressed air), CN(Compressed nitrogen), PE(Polyethylene), Pap(Paper)

waste

water emission

air emission

Preparing for data collection

Data collection boundary

Unit process - raw material unit - polymerization unit - devolation unit - pelletization unit - storage & packaging

Drawing up process tree

I. IntroductionII. Green Productivity IndicatorIII. Case Study (LCA)IV. Conclusions

1.3 Life Cycle Impact Assessment

according to the framework of ISO 14042 in order to identify

significant environmental issues.

LCIA methodology

- involves eight impact categories defined in the scope

definition.

- use the methodology developed from the Korean national

LCA project.

• normalization reference

• weighting factor


1.4 LCA results and Discussion

Substanceraw

materialpolymer-ization

divolation pelletizingstorage&package

total(kg)

CO2 3.15E+03 1.32E+01 3.54E+01 1.13E+01 4.18E+01 3.25E+03NOx 6.84E+00 3.01E-02 7.77E-02 2.66E-02 7.73E-02 7.05E+00SOx 8.55E+00 5.70E-02 1.40E-01 4.78E-02 8.06E-02 8.88E+00CH4 8.01E-01 8.99E-03 2.57E-02 9.07E-03 1.81E-02 8.63E-01COD 1.43E-02 2.62E-05 7.50E-05 2.65E-05 1.74E-03 1.62E-02N-tot 5.32E-03 2.14E-08 3.91E-08 2.90E-09 2.52E-06 5.32E-03

SS 1.61E-02 7.00E-08 1.41E-07 1.84E-09 0.00E+00 1.61E-02ash 6.50E+00 1.95E-01 5.56E-01 1.96E-01 2.78E-01 7.73E+00

sludge 1.35E+00 4.45E-04 1.08E-03 3.40E-04 2.67E-03 1.35E+00

Airemission

Wateremission

Waste

CO2 96.87% 0.41% 1.09% 0.35% 1.29% 100.00%NOx 97.00% 0.43% 1.10% 0.38% 1.10% 100.00%SOx 96.34% 0.64% 1.58% 0.54% 0.91% 100.00%CH4 92.83% 1.04% 2.98% 1.05% 2.10% 100.00%COD 88.44% 0.16% 0.46% 0.16% 10.77% 100.00%N-tot 99.95% 0.00% 0.00% 0.00% 0.05% 100.00%

SS 100.00% 0.00% 0.00% 0.00% 0.00% 100.00%ash 84.14% 2.52% 7.20% 2.54% 3.60% 100.00%

sludge 99.67% 0.03% 0.08% 0.03% 0.20% 100.00%

Airemission

Wateremission

Waste

I. IntroductionII. Green Productivity IndicatorIII. Case Study (LCA) IV. Conclusions

LCI results (unit process)

For most emissions, the contribution of raw materials are much greater than the contributions of other unit process.

Ranking of each unit process

Substanceraw

materialpolymerization

unitdivolation

unitpelletizing

unit

storage&package

unitCO2 A E E E ENOx A E E E ESOx A E E E ECH4 A E D E ECOD A E E E CN-tot A E E E E

SS A E E E Eash A D D D D

sludge A E E E E

Wateremission

Waste

Airemission


Ranking Criteria ▪ A : contribution >50% ▪ B : 25% < contribution < 50% ▪ C : 10% < contribution < 25% ▪ D : 2.5%< contribution < 10% ▪ E : contribution < 2.5%

Characterized value

Normalization reference

Normalized value

Weighting factor

Weighted value

RD 2.32E+04 1.87E+04 1.24E+00 2.42E-01 3.00E-01

GW 2.52E+06 5.66E+06 4.45E-01 2.11E-01 9.39E-02

OD 4.54E-02 8.26E+01 5.50E-04 1.72E-01 9.45E-05

AC 8.86E+03 5.64E+04 1.57E-01 6.40E-02 1.01E-02

EU 7.01E-02 8.90E+03 7.88E-02 6.00E-02 4.73E-03

POC 5.71E+02 7.37E+03 7.75E-02 4.70E-02 3.64E-03

HT 1.09E+04 6.64E+05 1.64E-02 1.05E-01 1.72E-03

ET 4.54E+03 7.49E+04 6.06E-02 9.90E-02 6.00E-03

Total 4.20E-01

Resource depletion and global warming were the two dominant impact categories.

LCIA results


99.4 97.0

0.0

20.0

40.0

60.0

80.0

100.0

raw material polymerization divolation pelletizing storage&package

Con

trib

utio

n(%

)

RD GW

The unit process of the raw material production was identified as the biggest source for resource depletion and global warming.

LCIA results(by unit process)



The LCA Study

Reduce the environmental impacts associated with the

raw materials(SM)

Alternative 1Selection of the raw materials with the lowest environmental impact

Alternative 2Reduction of the amount of the raw materials by using a new agitation process (Baffle equipment)

Alternative 3 Alternative 1 + Alternative 2

Baffle equipment is a mixing system which is expected

to enhance the mixing efficiency by minimizing the dead

volume in the reactor.

Alternative 2



0.9

0.95

1

current alternative

Production yield(Product/Raw Material)

Production yield(Product/Raw Material)

100

110

120

current alternativekwh

Electricity requiredElectricity required

Alternative 2


3.80E-01

4.00E-01

4.20E-01

4.40E-01

Current Alt1 Alt2 Alt3

Eco-indicator ValuesEco-indicator Values

Cost type and categories

Cost type Cost category

Conventional costCapital equipment cost, material purchasing cost, labor cost, utilities cost, energy cost

Hidden cost Waste management cost, regulatory compliance cost, maintenance cost

Contingent cost Remediation cost, property damage cost, personal injury cost, etc.

Image cost Relationship with staff, workers and suppliers etc.

Conventional and hidden costs (Types I and II) were addressed throughout the entire life cycle of a product.

I. IntroductionII. Green Productivity IndicatorIII. Case Study (TCA)IV. Conclusions

2. Total Cost Assessment2.1. Life Cycle Costing(LCC)

Cost type Cost category Cost factor(%)

Unit cost ($/ton)

Total cost (ton)

Life cycle cost($)

Capital Cost

Conventional costFactory construction

Process change

Sub-total

Operating Cost

Conventional cost

Purchasing cost

SM 100

Chemical 100

Storage cost

Energy

electricity 100 unit:kWh

LNG 100

Steam 100

Naphtha 100

Utility

CW 100

DW 100

FW 100

IA 100

N2 100

Production Labor

Hidden cost

Waste management

Waste water 100

Waste treatment 100

Regulatory compliance

Compensation 23allocated to

PSBase fee 23

Maintenance cost 23

Sub-total 7.49E+02

Total 749

Life Cycle Cost of PS 1 ton

I. IntroductionII. Green Productivity IndicatorIII. Case Study (TCA) IV. Conclusions

TCA was conducted to assess if a new baffle process (Alternative 2) is better than the existing process from the economic perspective.

Financial calculation - The present costs incorporate the concept of decreasing monetary value over lifetime of the new baffle process. - Use the compound interest table to calculate the present cost of an annuity over ten years. (5% of interest rate : 7.72 of conversion factor)

I. IntroductionII. Green Productivity IndicatorIII. Case Study (TCA)IV. Conclusions2.2. Total Cost Assessment

Cost type Cost category Current Alternative 2Capital Cost

Conventional costFactory construction

Process change

Sub-total

Operating Cost

Conventional cost

Purchasing costSM

Chemical

Storage cost

Energy

electricity

LNG

Steam

Naphtha

Utility

CW

DW

FW

IA

N2

Production Labor

Hidden cost

Waste management

Waste water

Waste treatment

Regulatory compliance

Compensation

Base fee

Maintenance cost

Sub-total 7.49E+02 7.44E+02

Sub-total(10yr) 5,780 5,750

Total 5,780 5,750

Present Costs

30USD/PS 1ton

Net present value

“Recommend to implement

baffle process”


The introduction of a new baffle equipment (alternative 2) is

expected to increase the profit by 21% over 10 years.

However, TCA results only consider the costs but do not

consider the environmental aspects, even if both direct and

indirect environmental costs are considered.


TCA Results

3.1. GP Index

This index value can be used to estimate the GP of a product

and compare it with other competing equivalent products.

SP/LCC

EI

($890/$749)

4.20E-01GP Index = = = 2.83


3. GP Indicators

Since GP ratio is larger than one, a new system is better than the existing one from the perspective of GP. GP ratio can be applied to select one alternative out of a list of contenders in order to improve GP of the existing systems.

I. IntroductionII. Green Productivity IndicatorIII. Case Study (TCA)IV. Conclusions3.2. GP Ratio

alt

cur

altcur

curalt

EI

EI

PCSP

PCSP RatioGP

Env. Impact

Ratio

Productivity

RatioGP Ratio

Alternative 1 1.039 1.000 1.039

Alternative 2 1.024 1.005 1.030

Alternative 3 1.066 1.005 1.070

3.3 GP Portfolio


Ratio of Productivity

Rat

io o

fE

nv.

Im

pact

1.0

III

II

IV

I-1I-2

1.01.006

1.020

1.040

: Current system

: Alt 1 (SM change)

: Alt 2 (Baffle Equipment)

: Alt 2’ (after 10yrs)

: Alt 3 (Alt 1 + Alt 2)

: Alt 3’ (after 10yrs)

1.005

1.066

IV. Conclusions

The measurement framework of GP was discussed.

- GP Indicators (GP Index & GP Ratio) and GP Portfolio analyze both the environmental and economic factors in an integrated fashion.

The LCA results show that the environmental impacts of the PS production are improved through the reduction of the amount of the raw materials.

The TCA results show that the solution to the environmental

problem is not costly but beneficial.


GP index can be used for the measurement of GP and GP ratio

can be used for its improvement.

GP Portfolio makes it easy to see the effect of alternatives from

both environmental and economic perspectives.

Effort to develop, apply and promote GP or Eco-efficiency will

encourage business to become more competitive, more innovative

and more environmentally responsible as well as contribute much

toward the sustainability of our society.


ik kim and tak hur konkuk university, korea an attempt to measuring green productivity 2 nd apo...

Documents

total productivity

level of gp

gp performance

gp indicators gp portfolio

conclusions gp ratio

gp indices

investmentyear productivity

case studyiv