Weather forecast for Europe: Hazy but green

March 9, 2006
Electronic-equipment designers face an ill-defined future when the European Union goes "green" this summer.


Senior Editor

The Project Management Office and Environmental Team for the Stryker Family of Vehicles (FoV) successfully eliminated components containing hexavalent chromium (Cr+6) and cadmium. Due to unavailability of commercial alternatives, some uses of C+6 were unavoidable on some fasteners and bolts. The team has spearheaded the evaluation of nonhazardous experimental trivalent chromium (Cr+3 ) processes developed by the U.S. Naval Air Research Lab. The NARL in collaboration with General Dynamics, Sterling Heights, Mich., and the Army Research Lab are testing the Cr+3 process for use on the Stryker FoV and other ground combat vehicles.


In October 1999, well before ink dried on the European Union's recent and impending environ-mental legislation, engineers at General Dynamics Land Systems, Sterling Heights, Mich., faced a daunting environ-mental mission of their own: Eliminating or reducing hazardous materials from the family of fast-paced combat vehicles for the Army's Stryker Brigade Combat Team (BCT). The mandate followed Executive Order 13148 Greening the government through leadership in environmental management that stipulates that the heads of each Federal agency establish strict environ-mental management and procurement strategies.

But unlike engineers faced with transitioning existing products to meet EU environmental requirements, General Dynamics designers could work from a clean slate. They also had financial support from the Dept. of Defense and a BTC Project Manager with the rank of Colonel to lead the charge.

General Dynamics set up a Green Procurement Plan (GPP) for the Stryker that covered pollution prevention and waste minimization. Moreover, their GPP had a champion: Colonel David Ogg made it his pet project.

So when the first vehicles hit the field in 2002, the team had eliminated about 2 lb of pigment containing the restricted substance hexavalent chromium (Cr +6 ) for each vehicle. They also found ecofriendly processes to replace Cr +6 containing pretreatments on nonelectrical aluminum components and swapped out cadmium-plated fasteners and hardware with zinc-plated alternatives. Zinc plating also let designers spec a less-caustic trivalent chromium (Cr +3 ) postrinse in place of conventional Cr +6 treatments.

All in all, the use of alternative green components and processes affected about 850 parts in every Stryker. And thanks to lessons learned there are other DoD programs including the Joint Strike Fighter, T-45, RAH 66 Comanche, and Advance Amphibious Assault Vehicle that have eliminated or minimized components containing heavy metals.

Unfortunately, many OEMs planning to ship products to the EU won't have access to a well-staffed DoD logistics agency, nor a Colonel Ogg to help navigate the complicated process of meeting strict environmental restrictions.

A "ROHS" WITH MANY THORNS
The looming July 1, 2006, deadline for the Restrictions on Hazardous Substances or RoHS (pronounced "rose") and the recently enacted WEEE (Waste Electric Electronic Equipment) Directives may only be the tip of the environmental iceberg waiting to scuttle or at least stall global deployment of many EE products. Environmental restrictions — including those imposed by RoHS and WEEE along with impending U. S., Japan, South Korean, and China "green" legislation — will soon burden OEM engineering departments.

Because RoHS and WEEE are Directives and not Regulations, they only outline objectives to be met. Most details on reaching compliance have been left for the market to iron out. OEMs (i.e., producers) were given no accepted global test procedures to evaluate EE products against the imposed restrictions or standards for documenting compliance. The EU also provides no enforcement body, which in effect leaves competitors to police each other's products.

The fallout from the EU's and other impending global green legislation could have devastating consequences for unprepared OEMs, cautions Pamela Gordon, president of Technology Forecasters Inc., Alameda, Calif. TFI is a strategic consulting and market research firm specializing in best-practice outsourcing and supply-chain methods for EE producers.

If TFI's most recent survey of 51 electronics-industry OEMs is indicative of the industry as a whole many OEMs still face a lot of work to gain RoHS/ WEEE compliance. In fact, says Gordon, there is still an unsettling amount of uncertainty in the industry over the facets and implications of the Directives. Some OEMs still don't realize that the ability to sell products globally may hinge on gaining RoHS/WEEE compliance. That's because the EU legislation is the basis for many green initiatives coming down the pike in countries outside Europe.

With virtually no rules of engagement spelled out by the EU, OEMs shipping EE products after the deadline are in effect "stating compliance." They must, however, substantiate this "self-declaration." They do so by supplying data to back up their claims. This entails devising an auditable system that collects, tracks, and discloses information on component material content that will give a strong case against mens rea (literally, guilty knowledge) if competitors sue. Any problem in the accounting process could have grave consequences beyond hefty penalties. Clearly, a brand name or company image could hang in the balance.

Many OEMs are following guidelines issued by the Dept. of Trade and Industry in the U.K. The DTI approach is based on the concept of "due diligence." This forces OEMs to prove through thorough component documentation (possibly down the entire supply chain to raw-material suppliers) that they have taken "all reasonable steps" and exercised all "due diligence" to avoid putting non-compliant products on EU shelves. But, in the end, there still may be no guarantee that extensive paper trails alone will stand up in court.

The burden may be doubly worse for many small contract manufacturers. "That's because many mom-and-pop shops will likely be ill-equipped to devise (on their own) robust accounting systems up to the challenge of thoroughly tracking every component to its raw material sources," says Bruce Calder, president of Ageus Solutions, in Canada. Ageus has software tools that can identify noncom-pliant parts and find replacements to meet RoHS and Japan Green requirements. The company also assists OEMs with WEEE registration and in devising comprehensive electronics recycling schemes for the EU.

A cautionary look at what befell industrial heavyweight Sony may be sobering for unwary OEMS shipping EE products to Europe this summer, says Calder. An environmental directive that restricted cadmium (Cd) in 2001 made Dutch authorities stop a shipment of Sony game consoles. They discovered traces of the element in cable accessories. The resulting product recall cost Sony about $160 million, says Calder.

And according to Sony spokesperson Teruo Masaki, the Cd problem was systemic. "It could not be isolated. It originated at the third-party raw-material manufacturing stage and climbed up the 'food chain,' affecting many of Sony's components."

"In response and at a significant expense," says TFI's Gordon, "Sony has since developed one of the world's most-comprehensive set of supplier requirements for restrictions of hazardous substances."

RoHS, often referred to as the "lead-free" directive, is a spec that is a lot tougher than just removing lead (Pb) from printed-circuit boards, says Calder. In addition to limiting lead it clamps down on the amount of mercury (Hg), Cr +6 , polybrominated biphenyls (PBBs), and polybrominated diphenyl ethers (PBDEs) to levels of 0.1% by weight (100 ppm) in homogenous materials. It also restricts Cd to 0.01% by weight or 1,000 ppm.

Homogenous in this context has a special definition. It is defined as "of uniform composition throughout" i.e., a material that cannot be further decomposed or what the directive calls "disjointed" into different materials, explains Richard Vermeij, spokesperson for Arena Solutions Inc., Menlo Park, Calif. Arena, also has a suite of product-life-cycle-management (PLM) software tools to assist OEMs with meeting RoHS and WEEE requirements.

"If you look at these interpretations, a plastic cover, for example, would be a homogenous material if made from one type of plastic and was not coated with any other material," says Vermeij. Here, the maximum concentration value of the RoHS regulation would simply apply to the plastic. A more-detailed example, however, is a connector assembly. The assembly has a housing, contact, and shell. Each of these parts are based on individual materials (plastic, brass, and contact plating) and may subsequently have any one of the RoHS regulated substances in its makeup.

Ageus Solutions' Calder concurs. "All of the restricted substances can easily find their way into critical enclosures and other mechanical components including conversion-coated fasteners and brackets as well as shielded cables and connectors that are as (and often more) challenging to bring to RoHS compliance."

Mechanical components have two significant material impacts under RoHS, says Calder. "One is conversion-coated steel used in common off-the-shelf screws, brackets, and enclosures. These generic components are prevalent in most simple mechanical drawings for electronics. The conversion-coated or plating callout, however, is really the banned substance Cr +6 necessary for corrosion resistance and low electronic conductivity (gener-ally to minimize electromagnetic emissions) as well as for meeting custom color specs."

The other material impacts come from heavy metals (Cd, Hg, Pb, and Cr +6 ) and flame-retardant additives (PBBs and PPDEs) in label inks and plastics. PBBs and PPDEs are not used much in EE products but designers still should be on the watch for them, says Calder. Heavy metals, on the other hand, give plastics vibrant color (i.e., reds, yellows, and oranges) and can also be found in inks on labels and safety decals for many EE products, says Calder. In the near term, it most likely won't be the lead solder in circuit boards that will peak attention from the RoHS "police," Calder claims. "One of the principal expected enforcement methods used by inspectors will not involve opening the EEE products. Instead, screws, brackets, wire shielding, connectors, and other large hardware will 'ping' handheld X-ray devices currently employed for detecting toxic substances." Ironically, Calder adds, an OEM could be handed an infraction if the ink used on labels with the "don't throw in the garbage" symbol (required by WEEE) contains even the smallest traces of Pb or Cd.

Ultimately, mechanical designers face two issues. First, they may be using components they know are noncompliant, says Calder. The solution here is obvious: Either find compliant replacements or redesign the product so it complies.

The other issue is a bit more problematic. Designers have historically used generic drawing callouts to describe part materials and qualities. This description is loose, perhaps stating "corrosion resistant, conversion plating, or coating" for screws and other hardware and acronyms for commonly spec'd polymers (ABS, PC, and PVC).

Loose requirements made it easier for procurement people to find vendors with the best pricing. But now it may be difficult or impossible to determine if the products in production stock rooms comply with regulations. "Parts may come from multiple vendors with different material formulations that could contain banned substances or through distributors that will not have access to material content records," says Calder.

Historically, chemical data specs weren't sent with drawing packages. "Years ago there was a bit of this," says Calder, "but realistically most product designers wouldn't encounter previously banned substances such as PCBs, asbestos, radioactive materials, and CFCs. Today, however, designers are indeed likely to see the newly banned substances. But unless they are designing medical or military gear they have likely never needed to exclude substances in a drawing callout."

"In addition, these drawings may not be in electronic formats that are easy to update," explains Calder. "Instead, many of the drawings from our customers are still on paper, vellum, or in CAD programs that don't have a material-management component built in." This would make the task of updating engineering drawings, whether paper or electronic, arduous for most engineering departments. "There aren't many companies outside either the medical and military supply chain that can push a button and tell which chemicals are being using in any given component," says Calder.

The task of getting accurate chemical data may be even more daunting if the steels used in an enclosure or bracket, for example, originate from a steel mill in China. Ditto for that offthe-shelf cable assembly made in a developing country. Language barriers and lengthy distribution chains may make it impossible to get accurate chemical data in these cases.

Designers may also be working with some industries that hold processing techniques close to the vest, says Calder. Proprietary practices pose their own set of challenges. For example, companies may be unwilling to give percentages of chemicals in their formulations. "They can state that they 'don't have the six banned substances.' That may be a good start. But will it be enough to satisfy due diligence?" queries Calder. In these cases, it will be prudent and more than likely necessary to run chemical analysis at an accredited lab.

SCRUBBING THE BOM
Some companies, says TFI's Gordon, "set their sights too low (i.e., doing things on the cheap) and don't take full advantage of available expertise and experience from reputable PLM and RoHS/WEEE service providers."

OEMs must determine how much time and resources — and hence cost — they are willing to allocate to documentation, says Arena Solutions' Vermeij. Depending on the number of drawings involved and the range of EE products shipped to the EU, the situation might warrant hiring an outside company with expertise in RoHS/WEEE compliance.

Companies including Ageus Solutions and Arena Solutions Inc. can provide robust component accounting systems and PLM. They convert drawings (whether on paper, vellum, or in electronic format) into a materials listing or BOM (bill of materials) which can then be "scrubbed." This so-called BOM scrubbing determines substances used in the assembly build and can ease the tracking of components from the top down.

"Capturing individual RoHS compliance data for every part in a BOM creates traceability and establishes due diligence," says Vermeij. Once the BOM is scrubbed, there are a variety of ways to get the paperwork necessary to support due diligence.

"Some are relatively easy, such as taking a supplier's claim from their Web site. But this is not really considered sound due diligence," says Vermeij. Other approaches range from getting Material safety data sheets (MSDS) and certificates of compliance (CoC) to supplier audits and third party lab analysis for every component in an assembly. The trick, says Vermeij, is to find the right balance.

A CoC or MSDS is likely sufficient coming from reputable suppliers such as Texas Instruments, General Electric, and Intel, says Vermeij. "But small, local (or Chinese) suppliers of cable harnesses, for example, may be reluctant to give anything beyond a simple letter stating 'we are in compliance. ' Here the prudent approach will be to spend the time and resources for a full supplier audit or lab analysis."

Companies working in RoHS/ WEEE compliance generally have software tools with extensive databases that can often more easily pinpoint noncom-pliant parts and find possible replacements. They can also help facilitate lab analysis if needed, locate vendors with compliant parts (on a global scale), and lend assistance with meeting WEEE obligations in Europe.

According to Gordon, "RoHS compliance should take a onetime investment of between 2 and 3% of the cost of hardware goods sold. This includes the investment of product-tracking software, scrubbing the BOM, supplier and part-replacement activities, testing, planning, legal advice, and so forth." The cost could be less, however, if OEMs use contract manufactures employing design-for-RoHS or design for environment (DfE) strategies that are ahead of the curve.

"To reduce costs or comply 'on the cheap,' some companies make different products for different regions — according to regional environmental requirements — or make them to just barely meet current minimum requirements," says Gordon. "But the least-expensive strategy for most global producers will be to design, manufacture, and manage all products to the highest environmental standards."

For example, companies that only remove the six RoHS substances, says Gordon, will probably not be able to sell to Nokia, which has a list of 200 banned substances, or to Sony, Hewlett-Packard, and other EE powerhouses that also have stringent substance specs. TFI advises that OEMs follow the toughest substance removal standards from serious, influential customers such as Nokia or Sony.

Regardless of how OEMs tackle BOM scrubbing, Gordon says they should make the process a key priority. And this should be regardless of whether or not their product ships to the EU. Other impending global "green" initiatives — including those in California, Maine, and New York (see page 148, New York City to go "green" in 2008) — will force OEMs to do the same level of document cleansing. A comprehensive BOM scrubbing may also give a leg up on the competition, Gordon says. That's because the EU has yet another surprise up its sleeve:

By 2008, additional EU legislation in the works could result in the ban of even more substances used in consumer goods. The bill, entitled Registration, Evaluation and Authorization of Chemicals or Reach, was recently backed by the European Parliament. It stipulates that the properties of some 30,000 chemicals be tested and authorized before being used or imported to the EU.

Companies that don't leverage BOM scrubbing and PLM software and other resources, including those from the American Electronics Assoc. (AeA), the Institute of Electrical Electronics and Engineers Inc. (IEEE), the International Engineering Consortium (IEC), and maybe even government agencies such as those within the DoD and the U.S. Commercial Service will likely find it a lengthy and more difficult process to meet current and future green legislation.

NOTHING "WEE" ABOUT WEEE
"With WEEE," cautions Ageus Solutions' Calder, "the process of meeting compliance may be 10 more complicated than complying with RoHS." That's because companies shipping products to one of the EU member states must meet requirements imposed by legislation in each individual country. But they are not required per se to meet the requirements of the Directives themselves.

WEEE does not spell out how take-back recycling systems will operate in each individual member state, says Calder. Legislation will, therefore, vary from one country to the next. Each is free to interpret WEEE as they see fit. "In the case of RoHS, there is a standardization organization called the technical adaptation committee or TAC for short that works cooperatively to standardize the exemptions, minimum concentrations of hazardous chemicals, and enforcement methods.

"The WEEE directive does not have the same EU-level standardization from country to country," Calder explains. "You can point to the first company to be fined for WEEE noncompliance (see page 146, First WEEE offender fined). Boots Retail in Ireland did not commit a transgression of a requirement of the WEEE directive, they failed to comply with a requirement of Irish national WEEE legislation that is not included in the EU WEEE directive."

"The WEEE Directive is widely referred to as the recy-cling regulation," adds TFI's Gordon, "but many people miss the fact that it emphasizes reuse before it mentions recycling. OEMs focusing on recycling may not be aware there are economies to be gained as well as competitive advantages associated with redesign for reuse and upgrade."

 

Gordon again stresses the importance of striving to meet the most-stringent benchmarks. "With WEEE, OEMs should aim for the German legislation. It sets the bar with the toughest interpretation for reuse and upgrade of any member state to date."

But getting a handle on all the parameters surrounding the legislation can be "mind-bogglingly difficult," contends Calder.

WEEE impacts any company (i.e., producer) that, irrespective of the selling technique:

  • Manufactures and sells EEE under its own brand
  • Resells under its own brand (i.e., rebrands or cobrands) EEE produced by other suppliers
  • Imports or exports EEE on a professional basis into a member state bound by the RoHS Directive

Manufacturers of EEE must:

  • Ensure that noncompliant products don't ship to the EU
  • Correctly label and design products for reuse or recycling
  • Register as a producer with member state agencies
  • Make sure collection facilities are in place, either through a collective effort or individual recycling scheme
  • Pay their share of treatment and recycling costs for separately collected items

Under WEEE, OEMs must also guarantee they will finance collection and disposal of products at the end of life. This endof-life obligation will stand even if the OEM disappears from the market. Problem is, there is no exact formula for OEMs to follow on this point. The process can range from opening frozen bank accounts, purchasing recycling insurance, to a contribution scheme for funding waste management.

"There are many recycling schemes, systems, or approaches throughout the EU," says Calder. The European Recycling Platform (ERP) was one of the first. It was founded by Braun, Electrolux, Hewlett-Packard, and Sony and handles the organizing of business-toconsumer (B2C) take-back in most countries. ERP generally focuses on larger consumer-product companies and initially will cover products from any manufacturer (historical waste). But over time it will only handle branded products.

Another system called the WEEE Forum is a group of industry-run collection systems. It's a nonprofit association formed for information and marketing purposes. Each member is a separate entity and only functions in its own country.

Ageus Solutions is probably one of the principal competitors to ERP, says Calder. "We use a collection of approaches (a different organization or recycler) in each EU member state and handle both B2C and B2B (business-to-business) waste. Some of the collection and recycling companies we use are members of the WEEE Forum, others may not be."

Calder adds that Ageus established a network of collection and recycling organizations in each EU member state. The goal is to get maximum return from end-of-life-products. Many companies require a return system for end-of-life and early-life-failure products. Ageus recommends integrating the two systems into one complete reverse supply chain. Under such a system, products as well as components can be returned for reuse, repair, refurbishing, or to be destroyed.

There are also a few more important requirements for WEEE compliance that OEMs should address before they start shipping product, says Calder. They include supplying instructions for end-of-life product dismantling to facilitate recycling efforts and developing a reporting scheme to disclose recycling and reuse data set by each EU state.

Material declaration and testing standards

There are a number of draft documents for material declaration and testing standards. These documents may be a useful resource to help OEMs determine if BOM scrubbing, material content declaration documentation, and other requirements for compliance to current and impending environmental legislation can be reasonably done in-house. They include:

  • The Guidelines for the management of chemical substances in products from the Japan Electronics and Information Technology Industries Association, (www.jeita.or.jp/english/). It is currently available at http://210.254.215.73/jeita_eps/green/greendata/Chemical20050927/050927_ma nage.gl.ver1.eng_.pdf
  • The Jedec Standard, Marking, symbols, and labels for identification of lead (Pb) free assemblies, components, and devices comes from The Solid State Technology Association (www.jedec.org) — the semiconductor engineering standardization body of the Electronic Industries Alliance (EIA). It is available at www.jedec.org/download/search/jesd97.pdf.
  • IEC 62321, Procedures for the determination of levels of six regulated substances (lead, mercury, hexavalent chromium, polybrominated biphenyls, polybrominated biphenyl ether) in electrotechnical products — comes from the International Electrotechnical Commission (Technical Committee 111) (iec.org). A draft of the standard is available on Hewlett-Packard's Web site (members.ipc.org/committee/drafts/D0WNL0AD_1751.htm).
  • TC111, Environmental standardization of electronic products and systems, was created to address a gap in international standards for emerging environmental legislation of electronic equipment. Standards development is underway for Materials Declaration, Environmentally Conscious Design, and Declaration of Environmental information and Test Methods.

And on the Electronics Manufacturing Initiative Web site (www.inemi.org) there are also links to the following standards:

More information on the green procurement practices, products, and contractors for the DoD can be found on the Defense Logistic Agency Web site (www.dlis.dla.mil/green).


First WEEE offender fined

Boots Retail in Ireland was the first company to be prosecuted for offenses under Waste Electric Electronic Equipment (WEEE) Regulations. The company pleaded guilty to charges brought by the Environ-mental Protection Agency. The company admitted it failed to keep a specified notice alerting customers that prices included a contribution to a producer-recycling fund. It also failed to include the information in an October 2005 newspaper advertisement, as required by the Regulations. The Court imposed a 1,200-Euro fine on the company, while awarding 6,865 Euros to the EPA.

It is important to note that the above fine for WEEE noncompliance was for provisions in Irish national WEEE legislation that were outside the requirements of the EU WEEE directive, says Bruce Calder, president of Ageus Solutions, in Canada. His company specializes in helping OEMs with environmental compliance. "This incident stresses the importance of under-standing the requirements of each EU member state, not just of the EU directives."

For example, each EU member state can interpret how environ-mental management costs, known as "Visible Fees", will be notified to the buyer, says Calder. They can be generally broken down into four different interpretations:

  • The producer is given the choice to show environmental management cost to the buyer.
  • The producer must show the environmental management cost to the buyer.
  • The producer is disallowed from showing the environmental management cost to the buyer.
  • The producer must show the environmental management cost to the buyer depending on whether the products are intended for use in private households.

New York City to go "green" in 2008

New legislation slated to take affect January 1, 2008, will push New York City agencies to purchase or lease environmentally friendly electronic products. A Director of Environmental Purchasing will establish and implement standards across city agencies. The Director will have the power to set the limits on the amounts of lead, mercury, cadmium, hexavalent chromium, polybrominated biphenyls, or polybrominated diphenyl ethers electronic devices can contain.

The Director will take into account the limits set by the Restrictions on Hazardous Substances (RoHS) Directive, as well as any subsequent material directive issued by the European Parliament and the Council of the European Union. The New York City laws also contain specific provisions about energy efficiency and end-of-life reuse and recycling. A plan for reuse and recycling must be in place by the 2008 deadline.


Green is green: Getting a payback from "green" initiative

A common misconception is that business must choose between profit and the environment. But just the opposite can be true, contends Pamela Gordon, president of Technology Forecasters Inc., a market-research consultancy based in Alameda, Calif., and author of Lean and Green, Profit for Your Workplace and the Environment, published by BK Publishers, San Francisco. Electronics companies can gain substantial economic benefits by designing Electric Electronic (EE) products that can be easily upgraded and recycled, are free of hazardous substances, and consume fewer resources.

Taking a strategic design for environment (DfE) stance can bring new revenue streams as well as reduce production costs, Gordon states. To increase profits in the face of escalating environmental restrictions, electronic OEMs need a visionary champion (at the highest executive level).

An authoritative leader can spearhead a strategic shift in the company's product-life-cycle-management goals, coordinate a multifunctional DfE team, and provide necessary resources for documentation and PLM-reporting software, as well as solicit out-side expertise. Here are general guidelines from a few leading EE companies that have boosted profits by making environmental improvements:

  • Question wasteful practices. Think outside the box to encourage employees to find more economical lean/green solutions.
  • Emphasize business benefits. Start an environmental initiative with strategies that will yield the highest impact on profit and the planet. Without a sound business strategy — avoiding revenue disruption, reducing costs, attacking competitors' market share, earning new revenue streams — management could actually be turned against the initiative.
  • Collaborate to reach the goal. Getting the senior executive on board early is often key to changing company culture and motivating people to create and implement "lean and green" solutions.
  • Track your progress. Software tools already in use, including PLM, can be instrumental in automating compliance tracking, reducing wasteful practices, and helping to meet competitive and profitability goals.

MAKE CONTACT
Ageus Solutions, (613) 566-7059,
ageussolutions.com
Arena Solutions Inc., (650) 687-5060, arenasolutions.com
Technology Forecasters Inc., (623) 293-6985,techforecasters.com
The Dept. of Trade and Industry, 020 7215 5000, www.dti.gov.uk
The European Recycling Platform, +32 2 777 0538, www.erprecycling.org
The U.S. Commercial Service, (202) 482-4767,www.buyusa.gov/europe
WEEE Forum, www.weeeforum.org

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