low temperature waste heat (warm water) is used for greenhouses suppling organic raw materials for a drug company that manufactures insulin. There is a coal-burning power plant from which desulfurization wastes are used by a wallboard manufacturer (Ehrenfeld and Gertler 1997). Although there have been a number of attempts to create eco-parks – there are now over a hundred around the world – it has been hard to reproduce such synergies elsewhere. One reason is the need for an eco-park to grow around a fairly large (and long-lived) basic industry that generates predictable wastes, with usable elements or components that smaller operations next door can utilise. And while policies should certainly promote the construction of more green factories and clusters of green factories, a greater challenge in developing economies today is how to retrofit, convert, and install more efficient and cleaner processes in existing factories.
At the product level, closed-cycle manufacturing achieves life-cycle efficiency by facilitating maintenance and repair, reconditioning and remanufacturing, with dismantling and recycling at the end, in contrast to today’s linear throw-away paradigm. The usual one- way flow of products from the factory to the salesroom is changed to a two-way flow. If the useful life of all manufactured products (and buildings) were to be extended by 10 per cent, the volume of virgin materials (except fuels) extracted from the environment would be cut by a similar amount, other things being equal, and resource prices would tend to fall. This would eliminate jobs for miners, but it would employ more people in downstream stages – especially repair and renovation and recycling – and cut costs through the supply chain all the way to final consumers, who would then have more disposable income. It is important to recognise that radical change is seldom painless. Schumpeter’s phrase “creative destruction” (1942) expresses this idea very well. Extending product life may also cut the rate of technological improvement. The lifetime extension of a product through increased reuse and recycling often results in relatively higher energy consumption levels because recent technological improvements have not been embodied in the reused products (such as cars and refrigerators). Life-cycle assessment of many products shows that most of the environmental pressure arises from their use and disposal rather than from the direct and indirect impacts of their production. The inability to capture technological improvements is especially acute in the area of electric power generation, where tough new source standards have inhibited the replacement of old generating facilities.
Remanufacturing is also becoming increasingly significant, particularly in areas such as motor-vehicle components,
cartridges. The Fraunhofer Institute (see UNEP et al. 2008) in Germany has calculated that remanufacturing operations worldwide save about 10.7 million barrels of oil each year, or an amount of electricity equal to that generated by five nuclear power plants. They also save significant volumes of raw materials. In the USA, it has been estimated that re-manufacturing is a US$ 47 billion business that employs over 480,000 people (UNEP et al. 2008). In terms of employment and economic impact, the remanufacturing industry rivals such giants as household consumer durable goods, steel mill products, computers and peripherals, and pharmaceuticals.3
Some companies are now introducing specialised
collection, sorting and dismantling plants around the world, either to save spare parts or to produce low-cost versions of their top-of-the line products. This encourages product redesign to facilitate the process. Caterpillar is probably the world’s largest re- manufacturer, with a global turnover of US$ 1 billion and plants in three countries. About 70 per cent of a typical machine (by weight) can be re-used as such, while another 16 per cent is recycled (Black 2008). Large diesel engines are routinely re-manufactured. Aircraft are essentially remanufactured continuously by replacement and reconditioning of most parts other than the body and frame (which is why some DC-4 and DC-6 aircraft manufactured in the 1930s or 1940s were still in use 50 years later.) Xerox and Canon, which began remanufacturing photocopiers in 1992, are among the companies that have pushed this concept.
The major obstacle to re-manufacturing is that
strategies for extending the useful life of manufactured products depend upon active cooperation from original equipment manufacturers (OEM). The OEMs have resisted this approach to date. In fact, the current trend is exactly the opposite: products are increasingly being made as un-repairable as possible, so that old products are discarded and usually sent directly to landfills. Another barrier is the fact that most products are not sold directly by their manufacturers or agents. This makes collection and return difficult. Original equipment manufacturers would have difficulty providing warranties for products remanufactured by other firms. Also, some companies are reluctant to market re-manufactured products in competition with their own new machines. Instead, customers are encouraged to replace old, but still functioning products with new ones. This problem is less acute in product categories (such as computers) with rapidly changing technologies, where new products have much greater functionality than reconditioned or re-manufactured old ones. Most consumer product companies see repaired, renovated or remanufactured
aircraft parts, compressors, electrical
and data communications equipment, office furniture, vending machines, photocopiers and laser toner
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3. For an analysis of over 7,000 remanufacturing firms in the USA, see the database and research by Lund (1996) and Hauser and Lund (2003) at Boston University, Available at www.bu.edu/reman/