Looking beyond RoHS & WEEE

07 June 2006

If you've struggled through to RoHS compliance, the bad news is 'there's more to come'. German Avila describes some of the challenges of further environmental legislation and goes on to explain how IT can help solve some of the headaches.

Most companies are currently focused on the RoHS and WEEE Directives, and all electronics products are affected by these mandates. Every product, in some way or another, whether in their manufacturing process, their use or their disposal, can potentially cause harm to the environment. Manufacturers are beginning to realise that if they do not comply with these regulations, they will not be able to conduct business in key markets.

Per a survey conducted by Electronics Supply & Manufacturing magazine, "the vast majority of the 238 respondents said they either have a plan in place or are working on a plan to transition to RoHS compliance...but while more than two-thirds said they are attempting to collect materials data, nearly half said they are having trouble doing so."

The RoHS and WEEE directives might be where all the attention is directed now, but new environmental regulations are being created all the time. In 2002, there were 256 laws in 100 countries that restricted hazardous materials. Today there are more than 320 regulations. The EU is a global leader in establishing environmental regulations and the EU RoHS and WEEE are serving as platforms for other countries to follow. Similar regulations and voluntary programs are also being established in the United States, China, Japan and South Korea, for example. Table 1 compares some of the key requirements for a number of these regulations. Region Legislation Status Date Scope Certification Testing Exemptions Labeling
EU EU ROHS Passed July, 2006 8 product categories No - Self-certification No Yes No
China China RoHS Passed March, 2007 Electronic Information Products and Product catalogue (consumer electronics) Pre-market certification by a pre-certified Chinese lab Yes (expected to be consistent with TCG 111 WG3) No 1. Toxic substance content marking

2. Packaging material content marking

3. Safe use period marking

4. country of origin
Japan Japan Proposed J-MOSS - orange "R" - contains ROHS substance or green "G" - does not contain.
USA, California CA ROHS Passed January, 2007 Covered electronic device (CED) -video display > 4" i.e. CRTs, LCD monitors, Plasma televisions. Yes No
Mercosur - Argentina, Uruguay, Paraguay and Brazil. Policy on Environmental Managament of Wastes and Post-Consumer Responsibility
Proposed Electronics, batteries, cellular telephones and mercury or fluorescent lamps.

Table 1 - RoHS and WEEE-like worldwide comparison matrix

China RoHS
The EU is not the only region focusing heavily on environmental initiatives. China is following suit with its own versions of RoHS and WEEE. China's equivalent to RoHS, known as the Management Methods for Controlling Pollution by Electronic Information Products, is scheduled to go into effect on March 1, 2007. Although still under evaluation, this regulation is said to be stricter than the EU's version.

China RoHS not only puts tighter requirements on the types of product classes required to comply and requires pre-certification of a product prior to sale, but it is also reviewed annually (unlike the its EU sister regulation which is reviewed every four years) and has other elements that are much more stringent than the original RoHS directive. For example, it will require products to be labeled with a date indicating how long the product can be used before it is no longer safe due to hazardous substances escaping or leaking the product. China is also in the drafting stages for a new WEEE-type law that will require recycling and take back of electronic products.

California RoHS
Beginning 2007 CA will prohibit the sale of electronic products if it is prohibited from being sold or offered for sale in the EU under the RoHS Directive. Almost all requirements will be common between CA and the EU; however there will be a number of differences. Some differences will benefit the industry, such as the limited scope of the regulation and some that will add additional burden to the process of managing compliance such as the need to generate an annual report.

CA RoHS only applies to "covered electronic devices" which are defined as a video display device containing a screen greater than four inches and unlike the EU it will not restrict the use of PBBs and PBDEs. The restrictions will be limited to the 4 heavy metals in the directive lead, mercury, cadmium and hexavalent chromium. On the other hand, CA will require the generation of an annual report that provides a summary of the amount of RoHS substances contained in the products sold in the state during that year.

Integrated Product Policy (IPP)
Most directives affect one stage of a product lifecycle, such as RoHS which focuses on product design and WEEE which is aimed at the disposal of products. The European Commission has developed an Integrated Product Policy (IPP) to further persuade manufacturers to be cognizant of their products' environmental impact throughout its life-cycles - from creation to usage to their final disposal.

In principle, all products and services are included in the scope of this policy. In practice, action might address all or only certain products, selected on the basis of discussions with stakeholders because of their importance and scope for improvement. Although legislation is not the primary focus of IPP, it will be a part of a mix of instruments to be used, if appropriate.

The main challenge with this policy is its comprehensiveness. Because it will generate directives or initiatives which impact the entire product lifecycle, it will require the involvement of numerous departments within a company, not to mention the participation of the complete supply chain.

Energy-using Products
The eco-design of Energy-using Products (EuP) proposed directive is the first piece of legislation implementing the IPP strategy. This directive has been created by the EU for products which depend on energy (electricity, fossil and renewable fuels) input to work as intended as well as products for the generation, transfer and measurement of energy. It is aimed at improving the environmental performance of products throughout their life-cycle by systematic integration of environmental aspects at the earliest stage of their design and will be focused on products which represent a significant volume of sales and trade, have significant environmental impact and present potential improvement in relationship to the environmental impact. At this time, the targeted products are heating and water equipment, electric motor systems, lighting, domestic appliances, office equipment, consumer electronics and air conditioning systems. The implementation deadline for member states for this directive is August, 2007.

Although this directive can truly benefit consumers by improving energy savings, enhancing the quality of energy-using products and enhancing the environment, like other directives, the EuP adds more complexity to the product design and development process for the manufacturers and their supply chains.

With regulations varying from country to country the potential for companies to comply with one regulation and not meet the requirements of a similar directive in another country is creating significant concern for global manufacturers.

Overall Challenges
Each one of the environmental regulations mentioned in this paper has very different requirements, but they each present very similar challenges for the supply chain. These include:

• complexity of the regulations
• limited understanding of regulations
• cost of compliance
• moving from the hazardous material to another compliant material
• additional staff requirements
• new technologies
• obsolete inventory
• and others
• overwhelming amounts of materials declaration data to be collected
• lack of standards for gathering information
• limited availability of data from suppliers

However costly environmental compliance is; the cost of non-compliance can be even greater. By not meeting the compliance regulations in the various global communities, manufacturers will be banned from doing business in certain areas of the world and may also receive financial penalties from the various regulatory institutions in addition to the lost revenue caused by having their products pulled off the shelves.

Emerging Technologies - Enabling Compliance
It is critical today that manufacturers and their suppliers have a solid information technology infrastructure in place to manage the complexities that the new environmental regulations have introduced.

Typically, critical information about suppliers, parts purchased and the use of those part substances is maintained and managed in separate systems. Additionally, most information systems were never designed to collect and verify compliance data. Companies will need to make investments in IT systems that can integrate current systems and provide a compliance framework to manage and analyse the vast amounts of information that will be required to implement cost-effective compliance programs.

Most ERP and PLM solutions have the capabilities to manage mass amounts of data and streamline processes, but for environmental compliance, it is essential for companies to implement a system that is designed specifically for environmental compliance and is compatible with industry standard tools, such as IPC's, the Association Connecting Electronics Industries, IPC-1752 forms and RosettaNet's PIPs 2A13 and 2A15 that help companies streamline the reporting of compliance and material composition data.

With new technologies, companies are able to track every material component for each product they manufacture and therefore, as new regulations arise, they will be able to easily evaluate their compliance based on their existing knowledge of their components and subcomponents or have the capability to efficiently collect the additional information required.

There are a variety of factors to consider when selecting an IT system to manage compliance. In addition to material compliance analysis capabilities, the system should be able to manage the rapidly changing environmental regulations not only in multiple markets but also in a wide range of geographies. Furthermore, the system's ability to integrate sourcing and product development information is an essential part of the compliance process.

For many companies the biggest challenge of all is gathering the necessary compliance and material content information from their supply base. A customer of Synapsis Technolgy declared that it was able to decrease the collection time and effort by 75% by the implementation of a compliance IT solution that helped automate the process of generating, tracking and processing of compliance and material content requests. One additional benefit of automating the process was a significant improvement in the data quality of the information received, as the IT solution was able to provide consistent data validation.

A large global telecommunications firm stated that the ability to tightly integrate its compliance IT solution with its multiple IT systems was critical in the success of its compliance program by allowing them to incorporate environmental considerations into the early product design stages. This was achieved by making environmental compliance information visible to all designers, component engineers, commodity managers and manufacturing engineers by replicating this information into the appropriate supply chain, design and manufacturing systems.

The bottom-line is that manufacturers and their suppliers must embrace the inevitable now. They must re-design parts and alter their design and manufacturing processes for current and future regulations. Although these regulations complicate processes, they ultimately enable manufacturers to design and build higher quality, more efficient products that are better for the environment.

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