How vital are chemicals in the fight for a healthy environment?

05 February 2007 00:00  [Source: ICB]

Are the greens walking all over chemicals? That's the question we pose on the cover of this issue. And that's the question the articles in this special edition of ICIS Chemical Business should help you answer.

JOHN BAKER/LONDON

At the risk of prejudicing your thoughts from the outset, those of us who write for ICIS Chemical Business feel that chemicals are increasingly being seen, and indeed sought, as a key part of the answer to many environmental issues. However, there are still specific areas where our industry is challenged, and needs to raise its performance. In the developed world, this is largely centred around product safety and chemical biotoxicity, while in the rapidly industrialising countries it is still more focused on pollution and plant safety.

Growing public concern over global warming and resource depletion is prompting many people to ask what can be done to cut energy usage, to increase food production and water availability, and to reduce consumer waste streams. The whole issue around sustainable development has become a huge media and political issue, and, indeed, one of business, with gains in terms of share value to be reaped through growing reward by shareholders of companies' green commitment and performance.

Impact of climate change

Global warming really hit the headlines late last year when the UK economist Nicholas Stern warned in The Economics of Climate Change: "There is still time to avoid the worst impacts of climate change, if we take strong action now." Many of those actions will involve the chemicals industry, through the provision of alternative fuels, clean combustion technologies and carbon capture, lighter and more fuel-efficient cars, better building insulation, and the development of solar and hydrogen energy the list is nearly boundless. Again, leading companies in this field are already deriving financial benefits for example, INEOS and Rhodia have both booked revenues for the transfer of technology to the developing world under the Clean Development Mechanism provisions of the Kyoto Protocol.

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Now even George Bush, president of the world's largest economy by far, is beginning to accept that global warming and climate change need to be addressed as soon as possible. He is backing the development of new greener technologies and the greater use of bioethanol. There are many others in the US, that huge greenhouse gases emitter, that are looking for action, including leading state politicians, notably California's governor Arnold Schwarzenegger, and the heads of major corporations, including DuPont and Shell.

The high profile of climate change and global warming at the recent World Economic Forum in Davos, Switzerland, and the hope that progress can be made for the post-Kyoto timeframe are certainly encouraging (see Davos below). It should bring even more opportunities for the chemical sector.

Shift of attack

This is not to imply that all is well in our industry. Over the years, it has certainly felt the heat from environmental pressure groups, and is still having to fight its ground in many cases, to protect its products and licence to operate. It will continue to have to do so.

The likes of Greenpeace, WWF and Friends of the Earth have gradually shifted their attack from focusing on pollution and specific chemicals, such as polyvinyl chloride (PVC), largely because industry has cleaned up its act to a tremendous degree and fought back with well-argued defences on several fronts. Now, the environmental activists are much more focused on chemicals in the blood, chemicals under the sink, chemicals in household dust - seeking to raise public fears about the cocktail of chemicals that can be detected at ever-decreasing amounts in the built environment and in our bodies.

Such attacks are difficult to counter but industry is responding through programmes such as the global Long-Range Research Initiative, and by improved toxicological testing. There is still, rightly, plenty of industry concern over the propagandist use of biomonitoring, which green activists are using to raise public concerns over chemicals without due analysis of the risks they pose, even if they are present in tiny amounts in blood and body tissue.

This focus on chemicals holds in the developed regions of the globe - North America, Europe and Japan. But the rapid industrialisation in some countries is still a cause for environmental concern in terms of general pollution. There has been wave upon wave of bad publicity from China, for example, as pollution there grows apace, even though the authorities seek to police production facilities and close down the worst offenders. And there are concerns in Taiwan and Thailand, as producers seek to invest to expand, only to have to fight hard for permits to operate because of pollution concerns. Environmental activists are emerging in places such as China, but they are still having to fight the battle that their western counterparts fought in the 1980s, on air and water pollution, and on unsafe facilities.

A lot of the heat on the industry in terms of its environmental footprint has been assuaged through the industry's voluntary Responsible Care initiative, now into its third decade, and widely adopted across the globe. This has spurred companies to drive down emissions to air, water and landfill, as well as improving health and safety at work because of requirements to collect and report indices in a transparent and public manner. In Europe, for instance, the lost-time injury frequency rate has declined year-on-year, nearly halving between 1998 and 2005. Similarly, emissions to water of nitrogen have declined by 40% since 2000.

But the industry is still plagued by major incidents, such as the BP Texas City explosion in the US, the Grande Paroisse explosion in France, and incidents at Sasol in South Africa, not to mention several other recent near-disasters. The reputation of the industry hinges in no small degree on incidents such as Flixborough, Seveso, Bhopal, Love Canal, Texas City and many other disasters.

Vigilance is needed

Much has been learnt from previous incidents, and much legislation has been drafted and implemented. But still the industry needs to be ever-vigilant and never neglect plant safety. This is perhaps one area where corporate oversight is not taken seriously enough in the chemicals sector. Environment, health and safety expert George Pilko argues in this issue that many companies' non-executive/advisory board members do not have sufficient environmental expertise to challenge flawed corporate practices, and to keep companies on their toes.

Regulatory issues

Many in the chemicals sector are now hoping that the EU's mammoth chemicals policy Registration, Evaluation and Authorisation of Chemicals (Reach), due to come into force later this year, will gradually take some of the heat out of the debate over the safety of many chemicals in common use. The green organisations are certainly prioritising their efforts to see that implementation of this programme, which will affect 30,000 chemicals, is carried out as intended over the 11-year phase-in period.

The EU has taken a global lead with its Reach approach, and other countries are looking closely at similar initiatives, including Canada, with its recently announced chemicals management plan. The industry would prefer a global approach to chemicals management, to maintain or, more accurately, to create a level playing field. It is through initiatives like the Globally Harmonized System of Classification and Labelling of Chemicals and the Strategic Approach to International Chemicals Management that such progress might be made, as long as all countries buy into and sign up to these.

But it will take a long time to determine whether the Reach approach will promote innovation of newer, safer products, or simply reduce the scope of chemicals available to downstream manufacturers. In many cases it will be they that will drive the innovation, as they look to the chemical industry - their supplier - to come up with alternatives that can allay the fears of their consumers.

Allaying customers' fears is especially pertinent in the retail sector, where the giant food and clothing companies feel they are under pressure to be green and reduce their environmental impact. And, as this is business, they see a commercial case in doing so. The recent pronouncements by Marks & Spencer and Tesco in the UK, and Wal-Mart in the US, on eliminating certain chemicals from their products and substantially cutting the use of plastics packaging, will inevitably be followed, in turn, by their competitors.

End-users will also be looking to the chemicals industry to help to meet other regulatory demands, such as the EU's vehicle end-of-life directive, which seeks to increase automotive component recycling, and the waste electrical and electronic equipment directive and Restriction of Hazardous Substances directive.

Greener products

Here, too, manufacturers are taking their own initiatives to make their products greener. Computer maker Dell has decided to phase out certain chemicals and polymers, and, earlier this year, a number of mobile manufacturers, along with network operators, suppliers, recyclers and consumer and environmental organisations, committed to improving the environmental performance of mobile phones. The group also aims to raise consumer awareness and participation in take-back and recycling schemes. The initiative is led by mobile phone producer Nokia, and was formed as part of a European Commission pilot project looking at how industries could work with stakeholder groups to reduce the environmental impact of products through their life-cycles.

The explosive growth of computers and associated electronic equipment is bringing its own problems in terms of disposal and landfill. The United Nations has begun to tackle this issue through The Basel Convention on Control of Transboundary Movements of Hazardous Wastes and their Disposal. At a meeting last year, it discussed how to deal with the rising volume of hazardous waste and, in particular, electronic waste (e-waste), which it estimates at 20m-50m tonnes worldwide each year and is rising at 3-5%/year. This can include lead, mercury, cadmium and other hazardous materials whose removal from new products will have an inevitable knock-on effect on the chemicals industry.

Also in this special issue of ICIS Chemical Business we look at environmental issues in shipping and logistics and at the current issues surrounding the development of genetically modified organisms in Europe. We have also devoted plenty of space to the good things the industry is doing - where indeed it is proving the answer to environmental concerns. How the industry can be part of the green solution is discussed next and recent innovations in green products by the major producers are highlighted.

Shout about it

This is really what the industry needs to communicate and shout about to the wider world and consumers, as the tide of public perception is focused on climate change, energy efficiency and reduced use of fossil fuels, prompted by global warming, high energy prices and energy supply security in many countries.

Now we have the opportunity to change the agenda and publicise not only how well we have done on cutting pollution and reducing hazards, but also how the industry can be instrumental in solving many of the problems that beset society. The chemicals industry has already proven supremely effective in fighting illness and maintaining potable water quality.

Do you agree or not? We want your feedback! Email john.baker@icis.com

DAVOS

Blair predicts US breakthrough

Climate change and global warming were high on the agenda at the World Economic Forum in Davos. At the event, UK prime minister Tony Blair said international talks on climate change were "on the verge of a breakthrough" and that the US was in the process of a quantum shift on the topic.

Blair's words were given added weight by comments at Davos by US senator John McCain, a potential US presidential candidate, when he commented that he expects the US Congress to take action on climate change very soon, and the Bush administration to follow suit. "I admit that it is very late, and it may not be enough," McCain said, "but I think that for the first time you are going to see some action on this compelling issue."

Blair also pointed to president Bush's recent State of the Union address, noting that this "built on his 'addiction to oil' speech last year, and set the first US targets for a reduction in petrol consumption." Also, said Blair: "The German G8 presidency gives us an opportunity to agree at least the principles of a new binding international agreement to come into effect when the Kyoto Protocol expires in 2012 one that is more radical and more comprehensive [and] includes all the major countries of the world. It is a prize of tantalising significance and I think it is possible." He praised Germany's chancellor Angela Merkel's "excellent" G8 leadership.

China and India, although they have ratified the Kyoto Protocol, are not required to cut carbon emissions. They both used Davos to reaffirm their support for steps to reduce the effects of climate change. The forum heard that China and India will need Western clean-energy technology, notably clean coal combustion and nuclear energy, before they can take part in future deals. Jacques Aigrain, CEO of Swiss Re stressed that it is essential to transfer clean-energy solutions to both China and India. They need to use coal, so they need access to clean coal-based energy technologies, he told delegates.

Zhang Xiaoqiang, vice chairman of China's National Development and Reform Commission, stressed that his country intends to follow the Kyoto Protocol, and urged the speeding up of negotiations and establishing of concrete emission targets. While China intends to keep its emissions low, Zhang said, cement and steel production is highly energy intensive and only about as half as efficient as technologies used in the West.

Montek Ahluwalia, deputy chairman of India's Planning Commission, reported that his country's strategy is similar to that of China, but that India is increasingly turning to nuclear power to cut emissions.

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