Green Electronics and Sustainability: Key Business Imperatives for the 21st Century (2013)

1
Green Electronics & Sustainability -
Key Business Imperatives for the 21st Century
T. R. Ramachandran
Vice President, Corporate Quality & Programs
VLSI Design Conference, Jan 7th 2013, Pune, India

2
Outline
 What is Sustainability?
 Key Messages
 Major Sustainability Imperatives
 Climate Change
 Energy
 Materials
 E-Waste
 Sustainability Catalysts
 LSI and Sustainability
 Call to Action

3
Outline
 Key Messages
 Climate Change
 Energy
 Materials
 E-Waste
 Call to Action

4
What is Sustainability?
The US Environmental Protection Agency (EPA) summarizes sustainability as follows:
Everything that we need for our survival and well-being depends, either
directly or indirectly, on our natural environment.
Sustainability creates and maintains the conditions under which
humans and nature can exist in productive harmony, that
permit fulfilling the social, economic and other requirements of
present and future generations.
Businesses that maintain growth & profitability while preserving
harmonious balance with the outside world are sustainable

5
Sustainability & Capitalism
Source: M. E. Porter, M. R. Kramer, HBR (Jan 2011)
Influential strategic thinkers like Michael Porter emphasizing
sustainability (“shared value”) as key to preserving capitalism

6
Key Messages
 Sustainability is a strategic imperative for long-term success
 Electronics industry faces major challenges on sustainability front
– Climate change, energy, materials, e-waste some of the key issues to address
– Water usage & labor practices other focus areas (not discussed today)
 Key sustainability imperatives for industry:
– Reduce greenhouse gas emissions & carbon intensity & manage climate risks
– Increase use of renewable energy & focus on energy efficiency
– Drive materials traceability & sustainable materials strategy for products
– Implement effective e-waste management & recycling
 Holistic focus on sustainability can be good for the bottom line
– Sustainability investments can be offset by significant operational savings
– Reduces risks of future catastrophic events that impact growth & profitability
 Green electronics can & should enable long-term sustainability
– Technology penetration in most industries presents unique opportunity

7
Outline
 Key Messages
 Climate Change
 Energy
 Materials
 E-Waste
 Call to Action

8
Insurance Industry - Climate Change Canary?
Source: E. Mills, Science (Dec 2012)
What is driving these trends in the global insurance industry?

9
Weather-related losses - growing challenge for insurance industry
Source: E. Mills, Science (Aug 2005)

10
Source: Munich RE (Nov 2012)
To what extent is this trend influenced by climate change?

11
Key Questions for Tech Industry
 Are increases in natural disasters partly tied to climate change?
If so…
 What can we do to reduce risks & maintain sustainable growth?
– Minimal operational disruption
– Minimal supply chain disruption
 What can we do to support sustainable growth elsewhere?

12
Source: @justinwolfers (Jan 2013)

13
Climate Change – Is Global Warming Real? (1970s)
Source: Newsweek (Apr 1975) [ via 1, 2 ]
Source: Time (Jun 1974)

14
Climate Change – Is Global Warming Real? (1970s)
Sources: Skeptical Science (Aug 2010);
T. C. Peterson et al., in Bulletin of the AMS (2008)
Most peer-reviewed papers in scientific journals from 1965-
1979 predicted global warming, rather than cooling

15
Climate Change – Is Global Warming Real? (Now)
Source: W. R. L. Anderegg et al., Proceedings of the National Academy of Sciences U. S. A. (Apr 2010)
Vast majority (97-98%) of world’s climate science experts
concur on the reality of human-driven climate change

16
Source: UK Daily Mail (Oct 2012) Source: The Sunday Times – UK (Nov 2012)
Source: Forbes (Jul 2011)
However, some climate change skepticism persists,
generally expressed through the popular media
Source: The Telegraph - UK (Dec 2012)

17
Climate Change – Is Global Warming Real? Yes….
Source: Skeptical Science (2012)
Average of GISS, NCDC & HadCRUT4 monthly global surface T anomalies from Jan 1970 thru Aug 2012
Source: CNN (Aug 2012) Source: Berkeley Earth Surface Temp (BEST) Lab (2012)
Anomalies wrt Jan 1950 - Dec 1979 mean
Average global temp has risen ~0.8C over last few decades

18
Source: Times of India (Jan 2013)
Source: New York Times (Jan 2013)

19
Climate Change – Is Global Warming Real? Yes…
Source: NOAA Climate Watch (Dec 2012)
Warming refers to average global temp - not local day-to-day

20
Climate Change – Is Global Warming Real? Yes…
Source: A. Freedman, Climate Central (Jul 2012)
The notion of global warming does not preclude record lows…

21
Small Shifts in Averages  More Probable Extremes
Source: Hansen et al., NASA/GISS (2012)
Source: MIT News (Feb 2012)
“Climate dice” increasingly “loaded” towards high end of temp

22
Warmer/Higher Ocean  More Probable Extremes
Source: Skeptical Science (Nov 2012)
Satellite
Tide
gauge
IPCC
projections
Source: Kinnard et al. (2011) via SS Source: Arctic Sea Ice Blog (Sep 2012)
Warmer ocean, sea level rise & increased water vapor
partly implicated in some recent natural disasters
Source: IMBIE / NASA (Nov 2012)

23
The New Normal?
Source: Associated Press (Washington, Nov 2012)
Source: CNN (New York, Nov 2012)
Source: Washington Post (Virginia, Sep 2011)
Source: Think Progress (Tennessee, May 2010)
Source: Think Progress (North Carolina, Sep 2010)
Are we adequately prepared for this?
Are there steps we can take to mitigate our risks?
Source: NBC News (UK, Nov 2009)
Source: ABC News - AU (Australia, Feb 2011)
Source: Ria Novosti (Russia, Sep 2010)
Source: Climate Action / UNEP (Canada, Mar 2011)
Source: Accuweather (Pakistan, Sep 2012)

24
Climate Change – The Role of CO2
Source: : Foster and Rahmstorf via Skeptical Science (2011)
12-month running average of T anomaly data – raw data & data with non-GHG factors removed
CO2 emissions a major driver of global temp – removing other
contributing factors reveals the CO2 signal more clearly
Source: University of California, Berkeley Earth Surface Temperature (BEST) Lab (2012 - 1, 2)
Anomalies wrt Jan 1950 - Dec 1979 mean

25
Source: Skeptical Science (Jun 2010)
Recent increase in atmospheric CO2 traceable to human
activities…we currently emit ~2.4M pounds of CO2 /sec*
*Source - AP

26
Source: David MacKay in “Sustainable Energy – Without The Hot Air” (2008)
…Specifically, CO2 emissions have risen sharply since the
advent of the industrial revolution…

27
Source: NOAA (Jan 2011)
…and, current CO2 levels are unprecedented in at least 800,000
years – not to mention, CO2 remains in the atmosphere for long
Current
CO2 level

28
Industry Imperative - Mitigation Plans for Warming
The future could see anywhere from 1.6 to 6°C* of warming
compared to pre-industrial times (we’re at ~0.8°C now)
*For example, see PWC, IEA & World Bank estimates
Source: PWC (Nov 2012)
De-carbonization
required to limit
CO2 levels to 450
ppm & T rise to 2°C

29
Industry Imperative - Mitigation Plans for Warming
Work with suppliers, partners & customers to account for
climate change risks in our strategic & operational plans
Source: Germanwatch (Nov 2012)

30
Industry Imperative – Shrink Carbon Footprint
Source: Global e-Sustainability Initiative & Boston Consulting Group (Dec 2012)
Invest in innovation and actions that can shrink carbon
footprint, not merely slow its growth

31
Industry Imperative - Carbon Abatement Elsewhere
Source: Global e-Sustainability Initiative & Boston Consulting Group (Dec 2012)
“9.1 Gt CO2e amounts to $1.9 Trillion in
gross energy and fuel savings”
Collaborate with customers to help reduce their carbon intensity
and drive sustainability with significant operational savings

32
Outline
 Key Messages
 Climate Change
 Energy
 Materials
 E-Waste
 Call to Action

33
Global Energy Consumption
~30% of total global energy consumption by industry today
Fossil fuels currently dominate world energy sources
Source: K. Ward et al., HSBC, “Energy in 2050” (Mar 2011)

34
Energy & GHG Emissions
Energy use dominates GHG emissions & C intensity
Predominantly fossil-fuel driven; renewables GHG emissions ~ 1/10th
Source: D. Weisser, IAEA (2007)
Scales are
different!
Source: David MacKay in “Sustainable
Energy – Without The Hot Air” (2008)

35
Energy Demand Growth
Source: H. Gruenspecht , CSIS / US EIA (Sep 2011)
Without significant changes in energy use patterns, oil & energy
demand and CO2 emissions will roughly double* by 2050
*For example, see HSBC estimates

36
Energy Poverty and Growth
Source: IEA World Energy Outlook (2009)
Energy poverty worldwide already constrains growth
Demand growth can’t be met without efficient energy use*
Electricity
consumption in
sub-Saharan Africa,
excluding South
Africa, is roughly
equivalent to
consumption in
New York State.
In other words, the
20 million
inhabitants of New
York consume
roughly the same
quantity of
electricity each
year as the 849
million people of
sub-Saharan Africa.
Source: IEA Exec Dir
M. V. der Hoeven
(Jun 2012)
*For example, see HSBC estimates

37
Industry Imperative: Shift More to Renewables
Leading tech companies have started a shift towards
more renewable energy sources
 Intel
 Largest US tech purchaser of renewable energy (>85% of total energy)
 Reportedly ties part of employee variable compensation to sustainability goals
 Google
 Significant renewable investments & drive towards carbon neutrality
 Over 30% of energy is sourced from renewables
 Microsoft
 Carbon-neutrality by fiscal 2013 & increasing use of renewable energy
 Internal carbon-fee based model to drive operations
 Apple
 Main data center expected to use 100% renewable energy in 2013
 Others have eliminated coal based sources
Greater renewables use reduces carbon intensity - will also help
drive growth & lower costs for renewable energy technologies

38
Industry Imperative: Energy Efficiency
 Many tech companies (e.g., Google, Facebook) driving energy efficiency
 Energy efficient products becoming more and more important
 Energy efficiency can also be profitable business model for utilities
Energy efficiency is good for business & sustainability
Source: Pacific Gas & Electric (1, 2, 3) Source: San Jose Mercury News (2010)

39
Outline
 Key Messages
 Climate Change
 Energy
 Materials
 E-Waste
 Call to Action

40
Materials & Disposal Challenges
Source: Electronics Takeback Coalition
Electronics manufacturing and use involves
many materials & disposal challenges
Pb, Hg, Cd, Cr6+,
PBB, PBD, flame
retardants, other
toxic materials
Restricted Materials
Ta, Sn, W, Au mined
from the Dem
Republic of Congo &
nearby conflict zones
Conflict Minerals
Mounting e-waste,
low elemental
recycling efficiency,
limited e-recycling
E-Waste
Extracted elements
(e.g., rare earth
metals) that are not
easily available
Scarce Elements

41
Elements Used in Electronic Products
Source: National Research Council of National Academies / Intel (2007) Source: UNEP / Umicore (2009)
Number of fundamental elements present in typical
electronics / ICs has grown rapidly in the past 2 decades
Elemental presence
in computer ICs

42
All Materials Carry Some Depletion Risks
Source: A. M. Diederen (Jun 2009)
If extraction cost & energy needs become prohibitive, this
will impact product sustainability & increase carbon intensity

43
Scarce Elements Pose Sustainability Challenge
OtherPt group Rare earths
Source: National Research Council of National Academies (2007)
Supply risk of some metals key to electronics &
renewables is moderate to high

44
Scarce Elements Pose Sustainability Challenge
Source: Dr. Duru, Seeking Alpha (Jul 2011)
Source: S. Bicheno, Hexus (Aug 2011)

45
…Could Impact Move to Renewable Energy Sources
Source: A. M. Diederen (Sep 2010)
Double impact of scarce material depletion could
be a big setback to meeting sustainability goals

46
Conflict Minerals Tied to Huge Human Toll in Africa
Source: IHS (Jan 2011)
Key minerals mined in the Democratic Republic of Congo
(DRC) or vicinity - tied to years of conflict and war over
resource wealth - are referred to as Conflict Minerals

47
Usage of Conflict Minerals in Electronics
Metal DRC % of Global Supply Key Use in Electronics
Tantalum (Coltan) ~20% [CRS], ~ 10-20% [IHS] Capacitors
Tin (Cassiterite) ~ 2-5% [CRS], ~ 6-8% [IHS] Solders, alloys
Tungsten (Wolframite) ~ 0.5-1.0% [CRS], ~ 2-4% [IHS] ICs
Gold ~ 2% [CRS], < 1% [IHS] IC packaging
Source: Congressional Research Service (Jul 2012), IHS (Nov 2010)
Source: Apple (2012)
Avoiding use of minerals that support armed groups committing
human rights violations in DRC is a key imperative

48
Restricted Materials (examples)
Key Materials Example Usage in Electronics
Included under EU RoHS requirements (6 now, might expand)
Lead – Pb Cables, solders, PCBs, lamps, batteries, etc.
Cadmium – Cd Cables, platings, contacts, CdX detectors
Mercury – Hg Switches, lighting, displays, scanners
Hexavalent Chromium – Cr6+ Anti-corrosion coatings
Polybrominated Biphenyl - PBB Flame retardants used in plastics, cables,
PCBs, connectors, etc.Polybrominated Diphenylether - PBDE
Included under EU REACH requirements (138 now, growing every year)
Cobalt Dichloride - CoCl2 Humidity indicator cards, desiccants
Dibutyl Phthalate - DBP Plasticizer, dye, pigment, paint, ink, adhesive
Bis(2-methoxyethyl) ether Electrolyte in batteries
Typically toxic, have restrictions tied to use in electronics –
common global requirements growing, esp. in Asia

49
Materials Traceability
Source: IHS (Jan 2011)
Materials traceability within supply chains can be a
significant challenge for electronics companies

50
Outline
 Key Messages
 Climate Change
 Energy
 Materials
 E-Waste
 Call to Action

51
E-Waste & Recycling
Source: Server Monkey (2010)
~40 million tons of e-waste / year*
Only a small fraction is recycled
*For example, see UNEP (2009)

52
E-Waste & Recycling
Asian countries a
major disposal point
for toxic e-waste
Source: P. Rekacewicz, UNEP/GRID-Arendal (2005)

53
Industry Imperatives: Materials & E-Waste
 Use scarce elements judiciously in products
 Minimize use of restricted materials in products
 Avoid using minerals that support armed groups in the DRC zone
 Implement materials traceability capabilities through supply chains
 Collaborate to ensure safe e-waste disposal & effective reuse
Sustainable materials strategy and effective e-waste
disposal & reuse key to long-term business, resource
& community sustainability

54
Outline
 Key Messages
 Climate Change
 Energy
 Materials
 E-Waste
 Call to Action

55
Sustainability Catalysts for Tech Industry (Examples)
Category
Key
Aspect
Laws & Government Regulations Industry
Specs/
Stds
Customer
Req /
Specs
NGOs &
Voluntary
ProgramsUS EU Other
Climate
Change
GHG
emissions
• EPA
• SEC
• CA -AB32
• ETS
• Carbon tax
• Kyoto,
• Carbon tax
• Cap &
Trade
• ISO
14064
• IBM, Dell,
Intel, etc.
• GHG Protocol
• AA1000
• CDP
• US EPA
Energy
Energy
efficiency
• Energy
Policy Act
• EUP • ECA
• CEA:
Sleep &
Active
• E-PEAT
• Lower
power
products
• Energy Star
Key Concerns
• Upfront investment required to drive
carbon intensity & energy efficiency
• Fossil fuels cheaper than renewables where
externalities are not priced right
• Lack of global coordination leading to
patchwork of laws & requirements
Likely Benefits
• Reduction in extreme climate events & lower
long-term business risks
• Significant energy cost savings & ability to
lift regions out of energy poverty
• Energy efficient products more competitive

56
Category
Key
Aspect
Laws & Government
Regulations Industry
Specs/Stds
Cust
Req /
Specs
NGOs &
Voluntary
ProgramsUS EU Other
Materials
Scarce
elements
• RESTART
Act*
• ERECN*
• Urban Mining
(Japan)
Conflict
minerals
• SEC Rules
• CA-SB861
• MD
• Prop*
• GeSI- EICC
• Conflict Free
Smelter
• PPA
• Cisco
• Intel,
Apple,
etc.
• OECD Guidance
• RSN
• Enough Project
Restricted
materials
• TSCA
• EPA CAPs
• CA
• RoHS
• REACH
• SAICM
• China
• India
• CEA
• IEC
• JEDEC
• Apple
• Sony
• Greenpeace Guide
E-waste
E-waste
disposal
• 25+ States
• WEEE
• Basel
Conv
• Japan
Recycl
Law
• India
• EPEAT
• R2
• E-Stewards
• Call2Rec
• WEEE forum
• Dell
• BAN
• Electronics
TakeBack Coalition
• Goodwill
*Legislation pending, not yet passed
Key Concerns
• Materials traceability challenges
• Finding alternative materials
• Required supplier oversight
Likely Benefits
• Reduction in supply & business risks
• Potential materials cost savings
• Community & health improvements

57
Investor groups increasingly active in driving sustainability requirements
 Carbon Disclosure Project (CDP)
 Collaborative initiative between investors with ~US $78 Trillion in assets
 Focus is GHG emissions and carbon footprint
 Principles of Responsible Investment (PRI)
 UN-backed institutional investor network with ~ US $30 Trillion in assets
 Focus is environmental, social, and corporate governance (ESG) issues
 Global Investor Coalition on Climate Change (GIC)
 Worldwide investor consortium with ~US $ Trillions in assets
 Focus is climate change
 FTSE4Good Index, Dow Jones Sustainability Indices
Investors will likely get more active in driving business
transparency & accountability on sustainability practices

58
…And Companies Are Paying More Attention
Increasing Sustainability Reporting a Good First Step
Need to Drive Key Imperatives for Sustainability
Source: GA Institute, Dec 2012

59
Outline
 Key Messages
 Climate Change
 Energy
 Materials
 E-Waste
 Call to Action

60
LSI and Sustainability
Category Goal Accomplishments-to-date Work Ahead
Climate
Change
Reducing GHG
emissions
• CDP reporting
• 26% reduction from 2007 baseline
• New companywide GHG goal
• Manufacturing partner emissions
Energy
Increasing energy
efficiency
• Low pwr, energy-efficient products
• Solid progress on energy efficient
data centers
• Next level of improvements in
operational energy efficiency
Materials
Reducing use of
scarce elements
• Tracing rare earths in products
• Significant progress on full
material declarations (FMD)
• Deeper collaboration with
suppliers to enable FMDs
Eliminating conflict
mineral use
• LSI Conflict Minerals Policy
• Collecting supplier data
• DRC “conflict-free” products
Minimizing use of
restricted materials
• RoHS & REACH compliant
• Green IC (no Pb/Sb/Cl/Br)
• Halogen-free PCBAs
• Eliminate RoHS exemptions
• Formal Design for Envir. program
E-waste
Maximize recycling
& reducing e-waste
• WEEE Compliant
• 76% waste recycling rate
• Earth Day e-recycling programs
• Zero waste to landfill
LSI actively driving internal progress & supplier requirements

61
Outline
 Key Messages
 Climate Change
 Energy
 Materials
 E-Waste
 Call to Action

62
Call to Action
Climate
Change
• Drive significant reductions in GHG emissions
• Manage climate change risks in operations
Energy
• Shift more towards renewables for energy sourcing
• Focus on energy efficient products & operations
Materials &
E-Waste
• Drive materials traceability through supply chains
• Implement sustainable materials strategy
• Drive safe e-waste disposal & effective reuse
Thank you!

Green Electronics and Sustainability: Key Business Imperatives for the 21st Century (2013)

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Similar to Green Electronics and Sustainability: Key Business Imperatives for the 21st Century (2013)

Similar to Green Electronics and Sustainability: Key Business Imperatives for the 21st Century (2013) (20)

Recently uploaded

Recently uploaded (20)

Green Electronics and Sustainability: Key Business Imperatives for the 21st Century (2013)