Eco-Design in Product Development Processes at

Eco-Design in Product Development Processes at Danfoss Drives Practices and Requirements from the EU Directive

Aalborg University Environmental Management & Sustainability Science 4th Semester Masters Project Anders Clausen

Case Company:

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Preface _______________________________________________________________________________________ Environmental Management & Sustainability Science Department of Planning Skibrogade 5, 9000 Aalborg http://www.environmentalmanagement.aau.dk/

Title: Eco-Design in Product Development Processes at Danfoss Drives Theme: Master’s project within environmental management & sustainability science Project Member: Anders Clausen

______________________ Supervisor: Rikke Dorothea Huulgaard __________________________ Company Contact: Aksel Jepsen __________________________

Nr. Of Copies: 4 Nr. Of Pages: 48 References: 4 page(s) Appendix/Annex: 56 page(s) Due date: 2nd of June 2016 Word count: 17.992/18.000

Synopsis: This Master’s Thesis examines Eco-design in the product development processes within Danfoss, and it’s interrelation to the EU’s standardization request for Material Efficiency. Part one and two of this report includes a description of the Eco-Design Directive and the EU’s processes of this along with relevant theory and literature review of product development and integrated product and process development (IPPD) also in order to help Danfoss with further steps. Part three analyses how this Eco-Directive so far has affected Danfoss, a Danish manufacturer, and how it can affect them in the future, with the target date for implementation of 2019. In part four Questionnaire, Document analysis and Semi-structured interviews will be used with key stakeholders addressing the theory and EU directives implementation towards 2019. Part five includes conclusions to the two aforementioned questions, along with part six on reflections and further recommendations for implementation and future work to be done at Danfoss.

The content of this report is freely accessible, but publication (with reference) requires permission from the author(s).

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Contents Preface .................................................................................................................................................................................................... ii Acknowledgements ................................................................................................................................................................................ iv Introduction ............................................................................................................................................................................................ v Problem formulation .............................................................................................................................................................................. v Methodology ..................................................................................................................................................................................... vi Research Design .............................................................................................................................................................................. viii Part 1: Eco-Design and Policy instruments ............................................................................................................................................1 1.1 Environmental Action Programme ................................................................................................................................................1 1.2 Eco-design Directive .....................................................................................................................................................................4 Part 2: Theoretical integration of product development .......................................................................................................................12 2.1. Product Development Process: The Stage/Gate Model .............................................................................................................12 2.2. Integrated Product & Process Development (IPPD) ...................................................................................................................14 2.3. Nine Principles to Eco-Design Product Development Methods ..................................................................................................16 Part 3: Danfoss Drives Description.........................................................................................................................................................20 3.1 Danfoss – Company Description .................................................................................................................................................20 3.2 Danfoss Drives– Focus of the Eco-Directive so far.......................................................................................................................24 Part 4: Analysis of material efficiency criteria at Danfoss .....................................................................................................................27 4.1 Integration of Eco-design and material efficiency in product development ...............................................................................27 4.2 Existing economic (and/or social & environmental) data Assessments ......................................................................................32 4.3 Challenges implementing and applying material efficiency in 2019 ...........................................................................................34 Part 5: Conclusions and Recommendations ...........................................................................................................................................43 Part 6: Reflections..................................................................................................................................................................................46 References .............................................................................................................................................................................................49 Appendices ............................................................................................................................................................................................53 Appendix A) 8 Deliverables from the Material-Efficiency Standard Request ....................................................................................53 Appendix B) 10 Principles in the Global Compact Initiative ..............................................................................................................54 Appendix C) How are mandatory product requirements decided? ...................................................................................................55 Appendix D) European Standardization Organizations (ESOs)..........................................................................................................56 Appendix E) Integrated Product Development with Product/Service Systems Approach .................................................................58 Appendix F) Measurement for extracting components in the end-of-life products ..........................................................................61 Appendix G) History of Danfoss ........................................................................................................................................................63 Appendix H) Description of a frequency converter ...........................................................................................................................64 Appendix I) Effects of the Directive on EuP so far .............................................................................................................................65 Appendix J) Semi-Structured Interviews ............................................................................................................................................66 Appendix K) Semi-Structured Interview Guide - Template ................................................................................................................67 Appendix L) Interview Transcriptions of Employees at Danfoss Drives A/S.......................................................................................71 Appendix M) Danfoss’ Comments document “Ecodesign note and questionnaire final” ................................................................107

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Acknowledgements I would like to first and foremost thank my supervisor, Rikke Dorothea Huulgard for always constructive feedback and an accommodating atmosphere while writing this thesis and also Arne Remmen for feedback. Along with these two thanks goes out to the entire staff at the Department of Planning at AAU and their environmental management masters programme. The company contact; Aksel Jepsen, Head of Industry Affairs at Danfoss Drives, for the setup of interviews at the case company – thank you also. My fellow students for collaboration on previous semester projects and group work, along with review on status seminars on the fourth master’s semester, thanks & acknowledgements goes forth to: Alexander Welsch, Edward Vingwe, Heidi Simone Kristensen, Kameliya Krumova, Lucia Mortensen, Niels Alexander Fluitman, Pernille Olesen, Trine Skovgaard Kirkfeldt and Vincenz Mehlstäubl. Finally and most importantly, I would like to thank my parents; my mother Lone Clausen for support and my father, Carsten Clausen, for constructive guidance and comments along the way and with final readthrough of this Master thesis. My girlfriend Sandie Christensen too – I could not have come this far without you, thank you for always believing in me.

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Introduction ESO (European Standardization organization) is currently developing a standard for material efficiency requirements, which is now under development and scheduled to be released in 2019 and adopted for the Eco-Design Directive afterwards. It is not a specific standard and hence not a final regulation yet, however 8 deliverables (described App. A. page 53) have been made for this request and these are subject for investigation. To describe the EU process and stages the Eco-Design material efficiency standard requests makes on product specific requirements see the App. C on page 55 to see the description of the five phases. Figure A shows a timeline of the key dates for the material-efficiency standards development and implementation:

Figure A: Timeline of Material-Efficiency Standard from the EU (March 2016) Since it will be under development until 2019, it will be investigated how this material-efficiency standard might affect the case company Danfoss Drives in the future.

Problem formulation Description of the thesis: The capabilities of companies to include sustainability into design and development of new products, assessed from the viewpoints of eco-design & life cycle management with focus on material efficiency. Title: Eco-Design in Product development Processes at Danfoss Drives This Master of Science Project in Environmental Management & Sustainability Science will look into material-efficiency standard and the Eco-Directive, as this could become a requirement in the future for product development processes. The concept of ecodesign for the problem field and its effect and possibilities of more environmentally friendly product solutions will be investigated and analyzed as well. This lead to the following problem statement:

“How can Danfoss Drives prepare for and integrate the material efficiency standard request, within their product development processes before 2019, for improving the product’s life cycle?”

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Sub-questions to support the problem statement;  How does Danfoss Drives currently integrate the Eco-design directive and material-efficiency in their Product Development practices? 

How does Danfoss Drives use existing economic (and/or environmental) data for assessing possible areas of improvement in the product life cycle in regards to Eco-design options?



What are the biggest challenges implementing and applying the Eco-design directive with material efficiency in 2019 from the EU?

and a reflective question last; 

How does Eco-design, here specifically Material-Efficiency Standard support ISO 14001 Life Cycle perspectives aspect of Product Development?

Methodology This section of the report will present the methodology and research design used to examine the problem statement and sub-questions. For these to be answered semi-structured interviews and their frameworks is used to conduct interviews. The people interviewed agreed to be recorded for later transcription, and the quotes presented themselves are written and translated from Danish to English by the author according to their statements. Both open-ended questions and closed-ended with evaluation on a scale of 1-5 is used. Semi-structured or Semi-standardized Interview Methodology According to (Flick, 1998) Semi-structured interviews are best used, when you only get one chance to interview the person in question. It provides a formal structured “guide” of questions in relations to specific themes and topics to be run through not from one end to the other, but in a more sporadic manner, with some open-ended questions to get the essence of people’s opinions. This is to say that the interview can follow the guide, but when necessary stray away from the trajectory, when it is sought appropriate. As stated in (Flick, 1998): More can be read about the method itself on the appendices App. J on page 66. “A goal of interviewing in general is to reveal existing knowledge in a way that can be expressed in the form of answers and so become accessible to interpretation” (Flick, 1998).

This knowledge is sought out with the semi-structured interviews of 1. A Product Developer, 2. A Standardization specialist/lobbyist 3. A Maintenance Manager and 4. Head of Industry Affairs Manager, 5. Global Approvals Consultant and Director. To see what the current knowledge of the new Material Efficiency Request is and how it can be possibly applied to Danfoss Drives product development activities in the future.

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Four main areas will be investigated these being; 1. 2. 3. 4.

The personal’s own profile, their specific part of the organization and its environmental impact The 8 deliverables and how they are and can affect Danfoss Drives, How they perceive the environmental strategy and the structure of the organization they are in The life cycle perspective for products and their opinions to use and analyze these.

The questions asked was grouped around themes, such as current standardizations processes, material efficiency aspects, environmental strategy, future aspects and the life cycle perspective, within the mind sets of employees in a cross departmental manner. The full extent of the questionnaire can be seen in the appendices pages 50 and onward, and the questionnaire guide is presented in App. K on page 67. All five interviewees represented both management level (3) and operational level (2) segments to get both levels understanding of how to incorporate these materials efficiency aspects into product development. If any adjustments are required or any points need elaboration or extra focus and attention, this will be sought out throughout the analysis. The Head of Industry Affairs department is interviewed, to get his understanding of the two focus points from the problem statement, i.e. how Danfoss Drives now integrates eco-design in product development practices now and how Danfoss Drives can prepare toward material efficiency aspect in the future. The differences between the management employees and the opinions from the product developers’ and maintenance segment will also be included to see if they have the same thoughts or not, on various aspects to this standard request from the EU. Initial Document Analysis are used to uncover already described areas of Danfoss Drives product development before the interviews are conducted and a problem field description written in Eco-design and policy instruments to “set the stage” for the origin of this material standard request originating from the Eco-Design Directive.

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Research Design The research design includes six steps; 1. Problem field description – Eco-design and policy instruments 2. Theoretical understanding – Theoretical integration of product development 3. Case Company Description – Danfoss Drives Description 4. Analysis – Analysis of material efficiency criteria at Danfoss 5. Conclusions and Recommendations 6. Reflections and further perspectives The first part describes the history and context of the Eco-Design Directive, leading to the material-efficiency requests developments. The second part gives a theoretical overview of what product development is and how integrated product development process can be mapped. Finally how Ecodesign can become a part of this. The third part describes the chosen casecompany Danfoss Drives, it’s history, material focus and energy agenda. Along with this how it product development process looks like today. The forth parts analyzes the interview data gathered through five interviews and seek out answers to the three sub questions this leading to; The fifth part with conclusions to these and subsequent Recommendations on the problem statement on how to implement material efficiency at Danfoss. Finally lastly in the sixth part reflection the systems aspects and international context of the European standard is reflected upon and what makes most sense to move on with; the energy or resource/material agenda?

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Part 1: Eco-Design and Policy instruments Part 1 will uncover the Eco-Directive’s historical background in the EU, it’s relation to the European Standards of Organization (ESO’s) and where it fits in within the 7th environmental action programme towards 2050. The Eco-Directive’s key adaptations along with policy instruments decided in the EU, what types of products are covered by the Directive, with the product life cycle aspect is sought answered. How the EcoDirective makes more environmentally sound solutions is further elaborated, to get a clearer picture of which stages the material-efficiency requirements are a part of. The waste hierarchy will be reflected upon to show the correlations with previous prevention strategies, where the Eco-directive’s material efficiency aspects fit in. The specific requirements criteria for the material-efficiency standard to be finalized in 2019 are presented to understand its content last.

1.1 Environmental Action Programme “The 7th Environment Action Programme (EAP)” is going to be guiding European environmental policy until 2020, decided in 2013. In order to give more long-term direction it sets out a vision beyond that, of where it wants the European Union to be by 2050, as stated: "In 2050, we live well, within the planet’s ecological limits. Our prosperity and healthy environment stem from an innovative, circular economy where nothing is wasted and where natural resources are managed sustainably, and biodiversity is protected, valued and restored in ways that enhance our society’s resilience. Our low-carbon growth has long been decoupled from resource use, setting the pace for a safe and sustainable global society." - (Action programme, 2015) The 7th environmental action programme itself has three primary objectives; (Action programme, 2015) 1. “To protect, conserve and enhance the European Union’s natural capital“ 2. “To turn the European Union into a resource-efficient, green, and competitive low-carbon economy 3. “To safeguard the Union's citizens from environment-related pressures and risks to health and wellbeing “

The 7th environmental action programme sets the scene for how circular economy principles can be applied towards the 2020 target date. Within the 7th environmental action programme is the circular economy strategy from 2010. The concept of circular economy is elaborated, and where in the circular economy that Eco-design may have an influence. Circular economy is the strategy, as proposed by [Ellen Macarthur Foundation] in 2010 and the latest iteration of this format from 2015 is included.

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1.1.1 Circular Economy Action Plan There are three principles of Circular Economy (CE) as shown in the figure 1.1 on the left side. (Ellen Macarthur, 2015): 1. Preserve and Enhance: Looks into renewable energy sources and finite materials and resources By using only renewable energy sources, or substituting materials and regenerating or restoring finite material’s balance. 2. Optimize resource yields: The core by circulating product, components and materials By circulating product/components longer and prolonging their life, recovering parts and reusing parts, in both technical and biological cycles. 3. Foster System effectiveness: Minimize systematic leakage and design out negative externalities By looking at the entire product system optimization – the way in which the part, components or product is incorporated within a system of other products/parts and how these negative externalities can be designed out.

Figure 1.1: Outline of three principles in Circular Economy (Ellen Macarthur, 2015) Eco-Design is mainly incorporated into principle two, and three with designing out negative externalities as shown by the red arrows in the Figure 1.1.

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The figure shows both biological (left) and technical (right) spheres, in question here is the technical sphere as the one of interest because Eco-design looks at design of physical technical Energy-using-products and Energy-related-products. This figure shows four principles from circular economy incorporated by eco design;  maintenance/prolong;  reuse/redistribute;  refurbish/remanufacture and;  recycle These to lead to better environmental performance of the entire European Union, with such target goals as stated by EU (Action programme, 2015): • Target for recycling 65% of municipal waste by 2030; • Target for recycling 75% of packaging waste by 2030; • Landfill target to reduce landfill to maximum of 10% of all waste by 2030; In order for these goals and objectives to be reached four "enablers" will help Europe reach these goals as stated by the EU themselves: (Action programme, 2015) 1. ”Better implementation of legislation” 2. “Better information by improving the knowledge base“ 3. “More and wiser investment for environment and climate policy“ 4. “Full integration of environmental requirements and considerations into other policies “ The four enablers of better legislation and information knowledge base are very general, and do not provide and specific guidelines, as to what type of exact legislation measures should be implemented. The last two enables of more and wiser investment, is a no-brainer, as this would be un-wise to state otherwise. Finally full integration of the requirements and considerations into other policies (here material-efficiency) goes hand-in-hand with this. The Circular Economy Action Plan and 7th Environmental Action Programme incorporate two additional horizontal priority objectives to complete the programme (what they in the long term are aiming for): (Action programme, 2015) 1. “To make the European Union's cities more sustainable” 2. “To help the European Union address international environmental and climate challenges more effectively“ With these two final objectives, the programme entered into force in January 2014, it is now up to the EU institutions and the member states to ensure it is implemented, and that priority objectives set out are met by 2020. (Action programme, 2015) Next the eco-design directive, and interplay between eco-design and other policy instruments used within sustainable development and circular economy principles. This is done in order to see the broader perspective of what other measures there can be taken besides eco-design, as a minimization implementing measure.

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1.2 Eco-design Directive 1.2.1 Eco-Directive – Commission implementing decision on material-efficiency First will be described when the Eco-Directive has appeared and it’s definition, along with the steps moving towards the decision on implementing material-efficiency in the directive of the 15. December 2015. The Directive was first introduced in 2003, and later adopted in 2005. The Directive as such holds many different standards, and each product group requires a product specific standard beneath it for final implementation. Eco-Design’s latest definition stated by the Directive as (ECO Directive, 2015): “The integration of environmental aspects into product design with the aim of improving the environmental performance of the product throughout its whole life-cycle”. The absence of material efficiency main reasons so far, is stated in a quote from the request below: “One of the reasons for the relative lack of eco-design requirements related to material efficiency in the implementing measures adopted so far is the absence of adequate metrics. These include absence of standards for assessing material efficiency aspects identified in previous product specific eco-design implementing measures; so far energy-use has been the main focus in the implementation of Directive 2009/125/EC, even though the scope of the Directive includes all environmental aspects, including material and resource efficiency” – (ECO Directive, 2015) The European Commission has since 2003 initiated two projects focusing on implementing resource efficiency and material efficiency requirements into the Eco-Directive.

The first project "Integration of resource-efficiency and waste management criteria in the implementing measures under the Eco-design Directive" was made by Joint Research Centre with the main purpose to analyze the feasibility and opportunity of developing resource efficiency requirement under the Directive. (Bundgaard et al., 2015) The s-nd project "Material-efficiency Eco-design Report and Module to the Methodology for the Eco-design of Energy-related Products” (MEErP) was developed by BIO Intelligence Service with the purpose to assess the possibility of enhancing material efficiency aspects in MEErP along with an update of the EcoReport Tool to incorporate material efficiency. (Bundgaard et al., 2015) In its outset, the Directive sets Eco-design requirements for energy-using products. However, the Directive was expanded in 2009, and it now covers energy-related products. In 2015 material-efficiency was adapted in an implementation decision request on the 17th December to be included in the Eco-Design Directive. The 5 steps of how mandatory product requirements are decided by the EU can be seen in App. C on page 55.

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The Eco-Design directive – here in question a standardization request to the European standardization organizations (ESO’s), as regards to Eco-design requirements on material efficiency aspects for energyrelated products, with its target date of implementation being 2019, is therefore still yet in its working stage for final implementation. The environmental impact of the product is thus analyzed throughout its life-cycle as shown in figure 1.2, covering all phases of raw materials and natural resources, manufacturing, packaging, transport, disposal and recycling.

Figure 1.2: The phases of a product's life cycle according to policy instruments (Huulgaard, 2015) In Figure 1.2 are shown the phases of a product life cycle as covered by different policy instruments [Huulgaard, 2015]. The Eco-directive is mainly on the “use and maintenance phase”, while the RoHS (Restriction of Hazardous Substances) Directive and REACH (Registration, Evaluation, Authorization and Restriction of Chemicals) regulations are in the “design and production phase”. The “design and product development phase” should cover the Eco-Directive as well since it is estimated that more than 80% of the environmental impact of a product is determined at the design stage. (Cecimo Manufacturing, 2015)

1.1.2 Interplay between different policy instruments and Eco-design The figure 1.3 shows the policy instruments mapped out on, how more or less product sustainable each instrument is. The Eco-design intervention method cuts out least sustainable products (minimum standard) while the energy labeling drives the market towards greater sustainability. Finally, the most sustainable option is European eco-labeling and Green public procurement (GPP) that encourages development of new and even more sustainable products than those on the market.

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Figure 1.3: Scope of interplay between different policy instruments aimed at sustainable development (M. Galatola, 2014) The Eco-design directive is one of many directives in the EU Circular Economy (CE) action Plan for 2020. This is shown to support, that Eco-Design is not the one-best option and that beyond material-efficiency, there are other parameters that need to be taken into consideration as well. One example of these policy instruments are shown; the intervention approach for energy labeling. Shown in figure 1.4 is the intervention approach cutting out the least sustainable products, here in question Energy Labeling and how this functions for one appliance:

Figure 1.4: Eco-design requirements cutting out the non-compliant product groups (EU Commission, 2012)

This intervention methods shown, cuts out the least best (worst) performing products from the market, with the best (A and A+(++) energy labeling here, in the graph above) being the best performing in the

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market. It does not require a specific energy standard for all products, but some product specific standards are made, that company’s has to live up to, to be able to sell their products in the EU. Table 1.1: Energy labeling for refrigerator appliances (Energy label, 2015)

This table is a graph for refrigerator appliances , with the Energy Efficiency Index (EEI) from A+++ to G is shown, it is calculated based on the annual energy consumption in kW/h (annual power consumption relative to a reference consumption that is based on the storage volume and the type of appliance) (Energy Label, 2015) The EU-flower is a voluntary environmental product declaration (EPD), which entered into state in 1992 by the EU commission. In 2015 nearly 44.000 products had this label, which lives up to ISO 14020 criteria for environmental product declaration. (Energy Label, 2015) The intervention approach for the Eco-Design Implementing decision of December 2015 in regards to these products; “Which calls for products to be ”‘eco-designed’ with a view to optimizing resource and material efficiency (…) addressing, inter alia, product durability, reparability, reusability, recyclability, recycled content and product lifespan" – (ECO Directive, 2015)

What the approach of the Eco-Directive is meant to fulfill, in regards to material efficiency, is explained in the quote below: “Directive results should fulfill the following criteria: provide reliable, accurate and reproducible measurement procedures, which are not prohibitively expensive or imply lengthy tests; and enable (when referenced by harmonized standards adopted in accordance with separate, product specific standardization requests) both economic operators and market surveillance authorities to determine conformity with relevant requirements set out in one or several Ecodesign implementing measures.” – (ECO Directive, 2015) Hence the Directive should not be seen as a rigid law passed to disable manufacturers with more lengthy tests, but enable them to save money and resources with the same means through material efficiency optimization. What product types are covered by the directive is explained next.

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1.1.3 Product types covered by the Eco-Design Directive The Eco-design Directive was extended in 2009 to include all energy-related products (ERP’s) (the use of which has an impact on energy consumption), including: (EU commission, 2012). The difference between the two is that: • “energy-using products (EuPs): are products which use, generate, transfer or measure energy (e.g. electricity, gas, other fossil fuel), including consumer goods such as boilers, computers, TVs, washing machines, light bulbs and industrial products such as transformers, industrial fans, industrial furnaces.” • “other energy related products (ErPs): are products which do not necessarily use energy, but have an impact on energy consumption (direct or indirect) and can therefore contribute to saving energy, such as windows, insulation material or bathroom devices (e.g. shower heads, taps).” The Eco-design Directive does not create binding requirements on products by itself: however, product requirements are set in Commission Regulations.

Figure 1.5: Product groups affected by the Eco-Design Directive (EU commissions 2012)

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1.2.1 Eco-Design Directive – Material Efficiency’s Criteria & Requirements Figure 1.6 is the theoretical expectation from the 2005 baseline of when the Eco-Design Directive was adopted towards 2020 with and without the Eco-Design Directive. The figure shows how the steps towards successful implementation of the new measures for specific product groups within the standards and the Eco-Design Directive and policy are made.

Figure 1.6: Theoretical model for assessing the impact of the Eco-Design Directive on Energy Savings (Oxford Research, 2012) In an ideal scenario, the evaluation of the effectiveness would be based on 5 steps:  “A first baseline measurement prior to the adoption of the Eco-design Directive.”  “Measurements after the preparatory study and the impact assessments are developed, the draft regulation is proposed and the requirements are adopted.”  “Several measurements after the requirements come into force.”  “A measurement at some point after the Implementing Measure is fully implemented and the desired effects have taken place. In the case of the Eco-design Implementing Measures this refers to the entry into force of the most demanding requirements.”  “Establishment of a control group to control for the developments in the absence of Eco-design requirements.”(Oxford Research, 2012) Thus this argument for assessing the impact of the Directive shows that measurement of product not covered by the Eco-Design Directive (a control group) can even without the strict requirements provide a net change in energy savings and CO2 reductions caused by other factors. This always has to be kept in mind, that regulation is not the only enforcement way to go, but improvements and innovation project in coalition with governments or other industry partners can also create a positive change instead of only the net impact of the Eco-design policy. Innovation and green partnerships are the way forward for the future

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and not just laws being enforced and controlled by legal and government institutions, according to the system innovation theory (discussed as a part of the reflection) (Brezet & Rocha, 2001). Eco-Design is linked to the three material-efficiency aspects included in the new material-standard request from 2015 (ECO Directive, 2015): a. Extending product lifetime. b. Ability to re-use components or recycle materials from products at end-of-life (EoL). c. Use of re-used components and/or recycled materials in products The EU sets these three as main parameters, to save materials and resources, not only in the short term by re-using individual components and products but also long term by extending current products life time. In the standardization request it is further stated that the three aspects; “…also cover aspects such as, upgrade-ability, ability to extract key components for reuse, repair, recycling and treatment; calculation of recycled and re-used content in products; methods to identify components by e.g. their environmental impact; reporting formats; reusability, recyclability and recoverability indices.” – (ECO Directive, 2015) Reusability, recyclability and recoverability are related to the Figure 1.7 of the Waste Prevention Hierarchy from the EU’s Waste Framework Directive in 1975. Since material-efficiency aspects is related to wasteprevention, as it looks at re-using and recycling components/parts else seen as waste at the product endof-life.

Figure 1.7: The Waste Hierarchy and its links to the EcoDesign Directive Strategies (Bundgaard et al., 2015) The prevention and re-use strategies are seen as being the best option and recovery & disposal being the least favorable options. As shown in Figure 1.7 design for re-use, design for recycling and design for disassembly and limiting the use of hazardous substances (VOC’s etc.) are all present in the Eco-Design Directive strategies incorporating recovery, recycling, re-use tactics as stated previously. However the material efficiency requests, is not as detailed here in the above, as it is not implemented yet for the

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Directive. This will be categorized under the extending useful life, and efficient use of resources under the prevention strategies, which is the best option to go for in the Waste Hierarchy pyramid. Environmental conscious manufacturing would incorporate both production and operations aspects. Hence the main parameter from the directive is to look at the end-of-life of products and to incorporate this way of thinking in the design of the products for material efficiency. The standard request includes 8 expected deliverables about, materials, use and disposal stages. The adopted eight deliverables shall as far as possible specify:  “Selection of parameters to be evaluated; “  “Calculation methods; “  “Test methods; “  “Definition of reference tables (or guidance on how to build representative and quality-assured tables); “  “Definition of reporting formats “  “Description of the means for communicating information regarding products. “ (ECO Directive, 2015) (Full set of 8 detailed deliverables can be seen in App. A on page 53)

Sub-Conclusions The conclusions to this section is that the process of incorporating Eco-design into product development has so far been a long a rigid process, taking to date more than 13 years, and entailed different products and product types throughout its history. Some of the elements from the waste prevention hierarchy from 1975 are still present in the current policies today towards creating more sustainable product solutions, but the view on energy and resources in manufacturing has changed a lot since the 70’s and 80’s. The section also concluded that there is a huge expected change from the EU by incorporating these aspects across industries. So far the material-efficiency standard request has an inclusion of eight expected deliverables, which will be investigated through interviews with the case company Danfoss. The principles of the EcoDesign Directive are in correlation with the Circular Economy action plan and 7th environmental action programme one of these policy instruments to make EU more sustainable. Since the processes for these already implemented policy instruments have not seen their implementation to their full extent, the material-efficiency request has a long decision horizon ahead of it. Part 2 contains a theoretical understanding of how Integrated Product development, through the manufacturing perspective is seen, along with a description of the product development stages. The Ecodesign product options are elaborated with its 9 design options. These are important to be able to later map and describe Danfoss Drives’ product development model and compare it to theory. It will be elaborated the need for more standardized methods of measuring the time to extract components in products at the disposal end-of-life (EoL) stage affected by the future Eco-Design material efficiency standard.

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Part 2: Theoretical integration of product development Part 2 will describe relevant theory, shedding light on engineering disciplines views of product development processes, stage/gate models, Eco-design product development methods and material efficiency. All these to be able to give validated solution proposals for the case company Danfoss Drives, mapping their product development process, and seeing where this material-efficiency request could fit in and be successfully implemented. These three theories are chosen, primarily to know what basic product development is and its phases/stages, then how one integrated product development model could look like, and finally the Ecodesign options to be implemented in this model, as part of material efficiency. Other theory on conducting product development workshops and brainstorm techniques could have been included, but were disregarded, as it was not seen as helping identify specific areas where the eco and material efficiency focus could be usefully integrated.

2.1. Product Development Process: The Stage/Gate Model The figure 2.1 shows the six phases of product development according to ISO 14062 on environmental aspects in product development. The first three phases (plan, concept and detailed design) is of most interest, for the material- efficiency agenda, since it’s in the initial design the biggest influence and change can happen. Continual feedback loops on environmental requirements persist through the entire process.

Figure 2.1: Typical Phases in product design and development adapted from ISO 14062 – Integrating environmental aspects in product development (ISO, 2002)

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The figure 2.1 shows the six typical phases for product design and product development. The first phase is the planning phase in the front end of the product development process: here the different projects and products are initially assessed and evaluated financially (cost/benefits wise) and a project manager is usually assigned to the project in this stage. This leads to the next stage where initial design ideas are presented and a rough overall concept design of the product is developed. In the detailed design phase the bill of materials (BoM) along with evaluation of specific requirements the product should fulfill. Here the environmental and social dimensions should be incorporated into the initial rough economic estimates made in the beginning with the go/no go action taken. Under the requirements determination phase 8 characteristics should be present for what defines a good end-user requirement for the product. These are according to a [Systems design and analysis book]; that good requirements should be: 1. “Testable” 2. “Verifiable” 3. “Justifiable” 4. “Precise & Accurate” 5. “Correct” 6. “Unambiguous” 7. “Consistent” 8. “Understandable” 9. “Modifiable & Editable” (Dennis et al. 2005) Testable and verifiable ensures that the product requirements in reality can be measured and evaluated, that the product in actuality saves energy and that this is verifiable by approved scientific measures by the scientific community. A bad requirement would be: “the product should save less energy” – how much less energy and in what sense? This requirement cannot be measured, like if you stated 10 % should be by energy savings in the use consumption phase of the product life cycle. To be able to justify that the product requirements are the ones actually required from the end-user in the system design, as not to become nice-to-have but a need-to-have requirement instead. Precise and accurate requirements mean that the requirement cannot be misunderstood, i.e. different use of terms and language or measurements and metrics in US or EU standard etc. By correct is meant that all the requirements can be traced by to the original user from where the demand first originated. It should be unambiguous by the sense that a demand requirement, like should be leading to more long term energy savings by the necessary personal, is an unambiguous requirement, because who is classified as the necessary personal and what are the exact long term energy savings?; within what sector or product category life cycle for example? There must be no room for error here. By consistency is meant that one or two or more demands does not contradict one another, like i.e. “must be as high end as possible – product wise” by the same time ”must be low maintenance and energy acquiring”, the first contradicts the last, as you cannot have a product that can account for everything, you cannot have it all. (Dennis et al., 2005)

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Understandable is that the working language other than being precise must be consistent to avoid confusion in the product development process. Finally the last good demand requirement must be editable and modifiable, if the requirement at hand doesn’t live up to end-user expectations or any of the 8 other characteristics have failed and it must be re-done to fit the original user from whence the demand originated. The phase in the generic product development process is the testing/prototyping phase. Here the product is made into a prototype and initial pilot setups for production are calculated and evaluated the economic and environmental impact within the Eco-Design perspective. The production layout, operational capacity plan, inventory management and different product batches and set-up times for machines should here be evaluated for getting the most optimal and energy saving production, with a quick output time of the products setup in the end. Scenario planning is here widely use with sensitivity analysis in this phase. When the prototype has been developed and detailed production preparatory setups made, the evaluated product is then launched to the market in the next phase. Here the market is evaluated and expanded through various marketing techniques, like selling the products in the common “piggy backing” or “mother hen” techniques, for smaller companies to incorporate sales or have subsidiaries in larger enterprises through joined ventures. The final phase in product development is ramping-up production and having a final product run-through, else “must” activities for already developed products are maintenance activities and finding possible improvements areas. One would be energy savings, another better material use and efficiency. The house of quality deployment; a product development technique for quality product requirement specifications is presented. Integrated product design policy is as such a vital part of an integrated product development (IPD) process, the steps of which are described in this section of this report. This is presented to get a better understanding of traditional manufacturing philosophy’s perspective on Eco-Design.

2.2. Integrated Product & Process Development (IPPD) The Quality Function Development (QFD) approach was first introduced by Y. Akao in 1966 and later used by Kobe Shipyards of Mitsubishi in 1972 along with Toyota applying this model since 1977. (Usher et al., 1998) One way to illustrate the product development needs is the “house of quality” as portrayed in the figure 2.2. It encompasses the translation of “customer wants/requirements” what the product needs to do, and how to do it (customer requirements and technical requirements) and how these relationships can be technically achieved through evaluation of technical requirements for a company and competitors products. Also customer complaints, company target level and the degree of technical difficultly can be added to the matrix, as well. In other disciplines, like concurrent engineering, illustrates the need for integration of all aspects of design, marketing, finance, and production simultaneously into engineering and the decision-making process. (Usher et al., 1998)

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Figure 2.2 House of Quality and Quality Function Deployment (QFD) (Usher et al., 1998) The basic philosophy behind QFD is that; “Basically , QFD translates the wants, needs, and desires of customers into quality characteristics, technical requirements and engineering characteristics of a product and subsequently into its parts’ characteristics, process plans, and production requirements by integrating information from marketing, engineering, research and development (R&D) or research and technology(R&T), manufacturing and management.” (Usher et al., 1998) The Eco-design and design for sustainability aspect is here also highly relevant, as more environmentally friendly product solutions become more of a requirement from customers. Hence, it is not to be seen as an expensive add-on, but a goal in the quality function matrix to add value to the products quality characteristics. Since more consumers want sustainable-labeled products (Eco label for example), this can as such become a need and not a nice to have any more from the customer’s perspective. The section looks into the nine principle approaches to eco-designing products, which product developers and managers can consider in the product development process (PDP) and the Quality function deployment activities.

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2.3. Nine Principles to Eco-Design Product Development Methods This section will explain the nine basic principles or approaches product developers can choose to take to Eco-design product and make them more sustainable and environmentally friendly. The figure 2.3 shows the nine principles:

Figure 2.3: Nine basic principle approaches to Eco-Design for products (Barbero et al., 2009) They consist of: (Barbero et al., 2009) 1. “Design for Components: The strength of parts” 2. “Reduction of materials and design for disassembly: The sustainable lightness of materials” 3. “Material discretion: The use of mono-materials and bio-based materials” 4. “Recycling and Reuse: Multi-use of materials” 5. “Size reduction: Decreasing the volume of the product” 6. “Service Design: 0% emitting products” 7. “Technology for sustainability: Techno/Ecologically sound products” 8. “Eco-Advertising: Saying, doing and then sustaining” 9. “Systemic Design: Zero Emission systems” The first principle of 1.Design for components is about identifying and optimizing the external form of a product or an object, starting with size and its arrangement of its parts, or components. The design starts with the analysis of disassembled objects of the same type, looking at the relationships between the components, physical-mechanical laws distinguishing them and technologies of manufacturing. After this definition phase, the developer’s works with the guidelines: (Design for components also means to take into account the accessibility of the product in terms of making it easy to use and maintain.)   

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Combining components of the same materials and avoiding the use of different materials; Marking the materials permanently (with stamps or labels); Minimizing waste production;

 

Pre-determining any breakage points to facilitate rapid removal of parts; Avoiding forms and systems that could complicate disassembly. (Barbero et al., 2009)

The second principle is about 2.Reducing the materials, which means to optimize the amount of both materials and energy in the development of a product. In taking this approach, the product developer and designer should also avoid using different materials, since this would complicate the recycling and disposal phase of the product. The choices should be based on a necessity of products functionality, if a less harmful or resource scare material could substitute the current, this should be considered and evaluated. Products that are created this way also satisfy the 2.Design for disassembly principle, since the object needs to be taken apart before it can be recycled. It should correspondingly also be easy to recognize certain materials as well, since each component can be either reused or recycled, despite being made of different materials. (Barbero et al., 2009) The third principle of 3.Material discretion by use of same type mono-materials or bio-based materials is often neglected, because unfortunately the request for a product’s appeal prevails over environmental issues on the market, which adversely results in high-impact products being introduced. There are however many advantages of using only one material, since if you initially design the product this way it simplifies the initial manufacturing setup and final recycling process. (Barbero et al., 2009) The approach however generally applies to relatively simple products, disposable objects and the single components of more articulated products. An example could be of an Indian manufacturer of edible utensils made of biodegradable materials that you also can eat, which decomposes by itself after 2-3 days. Other bio-based materials include both organic materials and the derivatives of natural products, such as biodegradable non-oil plastics, product for example with cornstarch or potato starch (PLA) (Barbero et al., 2009) The fourth principle of 4.Recycling and Reuse, though both similar, differentiate themselves in the products they generate. Whilst recycling involves the transformation and reuse of the material or materials of the object/product being recycled, reuse on the other hand puts the object/product itself back to work, involving purely the formal and structural, rather than chemical or physical changes to the object/product. First case of recycling the materials outlasts the products, in the second case it is the object/product or components itself that endure. Recycling approach contains various sub-categories, the three best known which are of the multi-use of materials: (Barbero et al., 2009) 

 

Cascading(Involving the recovery of materials with increasingly simplified uses with respect to their original one, due to loss in structural and chemical quality issues involved in their transformation) o Up-cycling: Where the materials, product or components are repurposed for a higher function (Phone line rare earth metals, like cobber repurposed in industrial production) o Down-cycling: Where the materials, product or components are repurposed for a lower function (tires for cars used for play grounds example) Post-consumer (Classic model, well known, involving the transformation of materials or parts of a product at the end-of-life stage, following separated waste collection) Pre-consumer (Theoretical model, less known, here the actual need to put the product on the market is checked at the start of product development. If the results are unsatisfactory, prerecycling takes place, meaning that production is suspended, thereby avoiding the waste of resources beforehand) (Barbero et al., 2009)

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The fifth principle of 5.Decreasing the volume consists of 1. Compressing, 2. Reducing and 3.Limiting consumption levels during transport of the products. These are the three requirements an Eco-design product developer must keep in mind, when developing an idea for a new product. Saving materials is only one part of Eco-design; the intelligent design of a products dimension also means preventing excessive consumption by the means of transportations. The more products carried in one single shipment, aggravates less emissions on the environment plus immediate benefits in fuel savings and costs. Two guidelines should be followed to size reduction: (Barbero et al., 2009) 



Designing both product and packaging at the same time; in order to optimize maximum amount of product transported in a single shipment (staking of packages, less materials, cardboard etc. leading to less “empty spaces”) Providing for assembly following purchase(so assembly also reduces the size of products following the purchase of materials)

The sixth principle of 6. 0% products and service design asks the question: “Can an object be replaced with a service?”. This approach is generally accepted since the use of a product generally serves some need and is born out of the need to facilitate an action rather than the actual desire to own or possess a product/object. In this approach it becomes a mix of a product/and service systems approach (App. E on page 58), with a single owner of the product/service who supplies a service for several users. The owner thereby profits financially even after the “classic point of sale” or “value offering point” as well, but at the same time profits environmentally too by minimizing resource consumption, emissions and waste, because the owner looks after the product for its entire duration (use phase). (Barbero et al., 2009) The seventh principle of designing 7.Technology for Sustainability along with Ecological aspects assesses, if a product or object can be made eco-compatible through the use of the appropriate technology. Here in questions the technological opportunities for improving e.g. the energy efficiency, but also the material efficiency of products, promoting energy and resource savings and combining several functions of products into one object. Whilst industrial production still today remains strongly tied to the exploitation of materials and resources, despite well-founded accusations of excessive use and consequent pollution, sustainable production and technological development operates towards increasingly saving materials, boosting at the same time the spread of services, and also technologies with a low environmental impact are becoming increasingly more widespread. Eco-Design, unlike conventional design moves between qualities and values, in which the communication of products and their systems is open and reciprocal – leaving room for feedback loops with the ecological sustainability of the product being its final goal. (Barbero et al., 2009) The eighth principle, of 8. Eco-advertising, is a communication and marketing tool, the difference here between usual communications of expressing environmental sustainability (sustainability reports etc.) is that Eco-advertising (not to be confused with green-washing/brain-washing) functions on several levels and takes many forms. Mainstream media is not the only use with advert or promotional campaign using slogans and graphics, as main means of communication etc. as there is nearly always a product on the market that declares its sustainability, as a sales point, making it a strength to the company in question. (Barbero et al., 2009)

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The final and last ninth principle incorporates the 9.Systemic Design option for products, looking at yielding zero emission system as a goal in itself. Other than all the aforementioned principles for design, Eco-design must also take into account the systems and its relationships within which the product itself is generated. There is hence a need for Eco-design product developers and designers to sketch out and plan the flow of the materials used from one system to another, since the impressive economic cycle produced thus gradually by this reduces the product systems ecological footprint. (Barbero et al., 2009) The entire purpose of systems design: to carefully study all the secondary bi-products and waste products created by using some resources, both to obtain information and to make a genuine assessment (could be through life cycle inventory “LCI” analysis or life cycle impact assessment “LCIA”). All production waste, that remains unused, for example, is therefore a cost in the system. Systemic design is about designing and devising a new production model setup in which the individual cycle of materials are open and connected to another (closing the loop – in circular economy). (Barbero et al., 2009) The extent product developers and designer choose to incorporate these nine principles are varied and sometimes contradicting, since using more technology to minimize energy usage and consumptions, places more materials in the product compromising the size reduction principle and the maintenance would prolong the durability of products, but not tap into the design for components for the product at end-oflife. As well as if service design is used, products are completely replaced by services leaving no materials or products to the other principle of re-use and recycling. Hence all principles cannot be incorporated into each and every product or product development process. There is therefore no exact way to Eco-design products, but these nine basic principles serves as an inspiration for product developers to consider in their initial pre-project phase, to not introduce more products on the market than necessary that consume more materials/resources or energy intensive using product for their life time (use phase mostly). This section also showed that Eco-design is much more than just raw-materials use reduction, and gives a much broader picture of the different options that product designers and developers have other than material efficiency and the first principle designing for components. Summary The summary from all the previous theoretical sections showed firstly the general product development model, and how this was interrelated with the Integrated Product Development Process (IPPD) and Quality Function Development (QFD) model. The quality function development model had room for improvement with an environment aspect being added. Also nine specific principles to Eco-Design were elaborated. This was presented to get the designers understanding on product development activities (theoretically) along with which stages they must progress through, in product design from the start to final launch to market. Next, a description of Danfoss is made in order to answer the problem formulations and subsequent subquestions. First a company description and an environmental assessment of Danfoss Drives is made according to their sustainability report. This followed by an analysis of the question; “How does Danfoss Drives integrate the Eco-design directive and material efficiency in their Product Development practices currently? “

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Part 3: Danfoss Drives Description Part 3 will describe the case company, its history, overall organizational structure, Danfoss Drives’ products and what its product development process currently looks likes. This is done in order to analyze which requirements and challenges in the product development process are present for moving from the energy to the resource/material agenda. Secondly the implementation of the Eco-Design Directive at Danfoss is elaborated – focusing on the past energy agenda for motors, as a VLT drives are used in a system with (a) motor(s) and pumps.

3.1 Danfoss – Company Description To get a brief overview of Danfoss’ History go to App. G on page 63. 3.1.1 Organizational Structure at Danfoss – Board of Directors Danfoss has four main business segments; these being Cooling, Heating, Power Solutions and Drives. These four business segments are shown in the figure 3.1 below outlining the Board of Directors at Danfoss. The focus of this project is within Danfoss Drives, who produces variable speed drives for controlling motors. (Danfoss c, 2016)

Figure 3.1: Board of Directors at Danfoss A/S (Danfoss c, 2016)

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3.1.2 Danfoss Drives Products – VLT© frequency converters This section is explained and elaborated to get a understanding of what materials a VLT drive consists of, as this makes sense in order to understand the analysis’ material efficiency aspects. In App. H on page 64 is a detailed picture of what a VLT consists of. Figure 3.2 a picture of the product group VLT 2800 series (variable speed drives/frequency converters) produced at Danfoss Drives A/S along with the software systems to read and manage the drives, called Profibus ©.

Figure 3.2: Product Group VLT’s at Danfoss Drives A/S (Danfoss d, 2016) 3.1.3 Danfoss – The Product Development Process today As stated previously in part 1; 80% of the expected savings for products is made in the initial design phase, hence this section looks into Danfoss Drives current product development process. This is done in order to later evalute and analyse, where the material efficiency deliverables fits in this process. Finally in order to be able to make recommendations to these material efficiency deliverables in the conclusion as well. What follows next is a description of Danfoss’ product development process that’s used across all Danfoss units, and what stages and phases the project progresses through from initial pre-project design to final validation and ramp-up, see figure 3.3.

Figure 3.3: Danfoss’ Product Development Process according to the project manager from Rikke’s PhD conducted in 2012 and the same project manager, 2016 (Product Developer, 2016)

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Danfoss Product Development process has six stages and five milestones (M0 to M6). It is a classic stagegate model (see previous theory on general product development). The first stage before M0 is the Front End processes, where possible projects and product portfolios are assessed. In the pre-project phase a project manager is chosen for the product to move on to the next phase product specific & concept design, which has some classic demands for specification, on functionality, quality, customer specific wants and needs along with the environmental aspects as covered in Eco-design too. (Huulgaard, 2015) The stages after the third mile stone (M3) in the product development process is the detailed design & verification phase, this covers the creation of a detailed bill of materials (BoM), estimates of final prices and costs. This to be able to move to the next stage of production, in the validation and launch executions release phase. Here a pilot series of the prototype product is made in production and setup-times for machines and a production layout with an overall capacity plan are sketched out. At the fifth mile stone (M5) the product is released to production (Q-release), and until final stage ramp-up and milestone six (M6), the focus is on stabile production, ensuring call-rates for quality of the product. (Huulgaard, 2015) 3.1.4 Eco-design methods of products at Danfoss so far Since Danfoss participated in a Danish research project called “EDIP – Environmental Design of Industrial Products” in the mid-1990s, the company has worked with environmental considerations during the design of new products. The EDIP method from 1997 used here, was updated in 2003 and covers 7 steps; these being, 1. Describe the use context, 2. Create an overview of environmental impacts, 3. Create your environmental profile and indentify root causes of impacts, 4. Sketch the stakeholder-network, 5. Quantify the environmental impacts, 6. Create environmental concepts and 7. Develop an environmental strategy. (McAloone, 2003) In the sixth step: creating environmental concepts, the Eco-design concept is one of these with the 9 principles mentioned previously. Its purpose was to make the company more environmentally aware of its product design to start by looking internally first, before communicating externally the company’s environmental impacts (with ISO life cycle impact assessment guidelines etc.) for more well-documented use. The methods vary between the divisions since they are greatly dependent on the type of product and the associated technologies. Each division or business unit has over the years developed its own design guidelines and tools based on a corporate guideline or the EDIP methodologies. It was however not possible to gain access to the two methodologies for environmental assessment and disposal declarations for Danfoss Drives, as the process owner of these wouldn’t provide access. In 2014, as part of the Sustainability Program, Danfoss has developed a common Eco-design guideline for all its divisions. (Danfoss Sustainability Report, 2014) The Eco-design guideline is in review and will be implemented starting in 2015. The guideline is based on the latest knowledge of Eco-design, taking into account relevant legislation, as well as known upcoming requirements for Environmental Product Declarations. Danfoss is in the process of testing a newlydeveloped setup for Environmental Product Declarations in one of its divisions. If the test is successful, the roll-out will be continued in all other divisions to ensure a one-company-one-way approach to environmental considerations during product design. (Danfoss Sustainability Report, 2014)

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3.1.5 Danfoss Materials Focus 2013-‘14 The table 3.1 aims at describing Danfoss materials focus from 2014 and onwards, as the way they measure waste/materials and chemical substances at company level has something to do with Danfoss and therefore also Danfoss Drives sustainability policy. In 2014, Danfoss changed the company’s IT systems for resource and material planning, which may have an advert effect on the accuracy of the raw material data. Many factories now report consumed rather than purchased amounts of raw materials as in previous years. A 100 % direct comparison of 2014 data to previous year(s) 2013 is therefore not possible but an estimation of material used is deemed possible still as the difference and error margin between the two numbers is deemed comparable . The use of raw materials grew by 11% due to an increased activity level in the Group. The main cause for the decrease in electronics is a reduced consumption in one of the Chinese factories. (Danfoss Sustainability Report, 2014) Later in the analysis the interviewees are asked about re-use and recycling of materials along with how waste disposal is handled. As can be seen in the table 3.1 the metals have increased reflecting the fact that Danfoss is a business in the metal processing industry: threequarters of all the materials used are metals. Plastics and rubber, packaging materials and other raw materials have also increased. Cleaning agents and electronics have been reduced, as mentioned electronics decrease were due to a Chinese factory’s reduction of these. Raw materials and wastes Waste to landfills has gone up with 11 tons (0.5 %) while also metals for recycling have dropped with 321 tones (or 2% in total) in ’14. Accumulated metals, cardboard, plastics, electronics and other waste have declined in recycled content with 1.052 tons or 4 % (of waste tones of 26.808 in totals) compared to 2013. As Danfoss is a metal processing industry the figures for metals and metals for recycled content was presented alone, as this is their major contributor to wastes (with 20.852 tons being recycling of metals) which is 77% or a little over three-quarters (3/4) as stated by Danfoss themselves. Why this cumulated drop of 4% recycling in 2014 from 2013, is it just because the amount is reported as consumed and not purchased amount that this number of 1.052 tons appear? Or have they done worse than the years before in recycled content in the disposal stage and had more wastes for land filling (0.5 %) or incineration of wastes? The total number of materials used in 2013 to ’14 has gone up with 28.550 tones or 11%. While metals are the biggest use, all other materials use, aside from electronics, have increased in that year. Has it increased from 2014 to ’15 and to ’16 as well? What exactly are the problems, for not only recycling more content, Table 3.1: Danfoss’ Production Use (Danfoss Sustainability Report, 2014) 23

by re-using and re-manufacturing some of the metals or materials Danfoss as of now does not use? This question will be sought answered through questionnaires and semi-structured interviews in the analysis part of this report. As this research is focusing on material efficiency, the material efficiency agenda communicated by Danfoss sustainability report is presented. The two sections will therefore look further into raw materials, and chemical substances, as previously described standards and directives are set for these through RoHs and REACH. Chemical substances In manufacturing its products, Danfoss uses a number of chemical substances, which may be harmful to humans or to the environment. Danfoss continually aims to limit the use of such chemicals: if they cannot readily be omitted or replaced Danfoss makes sure they are utilized as efficiently as possible, and that measures are taken to protect employees and the environment. (Danfoss Sustainability Report, 2014) The global Danfoss Negative List is the cornerstone of the Group’s efforts to reduce the use of harmful substances in processes, and to ensure that unwanted substances are used neither in production nor in the products. The List has been implemented in both Danfoss segments, and is regularly updated to include new legislation or changed requirements. Danfoss ensures that electronic updates are available to suppliers through a subscription service. (Danfoss Sustainability Report, 2014) The negative list is a minimum requirement from Danfoss’ side; however it does not ensure Eco-designed products, but secures avoiding harmful or environmentally dangerous substances and materials in the products or production process. Such as CRAN substances (Carcinogenic, harmful to the Reproductive system, Allergenic or harmful to the Nervous system) which increased by 2.5% relative to 2013, these substances are known to cause various cancers in humans and other advert effects to the nervous and reproductive system, so Danfoss needs to limit the use of these. (Danfoss Sustainability Report, 2014)

3.2 Danfoss Drives– Focus of the Eco-Directive so far As Danfoss Drives is a large producer of variable speed drives (VSD) for controlling of motors, so called frequency converters, the effects of the Eco-directive so far will be described, as seen through the energy efficiency agenda. As mentioned in part 1 problem field description, the Eco-design directive was twofold; focusing both on energy, here energy-using-product (EuP) and energy-related-products (ErP), along with material efficiency, the focus has up until this point been on the energy efficiency index (EEI)

Figure 3.4 Extended Product Approach model for VSD’s EEI (Europump, 2013)

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implementation. In the figure 3.4 is shown the extended product approach (EPA) and how it links a pump and motor to the terminal box, being the variable speed drives, which Danfoss Drives produce. All these in a system yield the extended product approach’s EEI. The timeline figure 3.5 shows CEMEP’s (European Committee of Manufacturers of Electrical Machines and Power Electronics) previous time line for implementation of the energy efficiency index. It shows that the deadline for motors meeting the IE2 energy class was set to 16. June 2011, and IE3 energy classes in 1. January 2015. This deadline was not met, however all companies have the final implementation to IE3 is to be the 1. January 2017 or equipped with a variable speed drive (VSD).

Figure 3.5: Timeline for Implementation of EI3 motors set by the EU directive EuP (Energy using Products) (Sckerl, 2010) The implementation measure of the IE2 energy class requirement has lead to a higher market share (from 9% in 2005 to 20% in 2010) as shown in figure 3.6, up until 2010, when the preparatory study was made. The author has not been able to find newer data for this by CEMEP. Fewer motors sold below IE1 energy class has also been a consequence. The timeline towards 2011 implementation, cutting out the least efficient motors, has therefore had an effect.

Figure 3.6: Market share of efficiency classes in Europe under the CEMEP Voluntary Agreement (CEMEP) (Oxford Research, 2012)

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Looking toward sales for one product in the extended product approach; the pump, as described by EUROPUMP, the figure 3.7 delves into showing that the market share of more efficient energy labeling products has grown towards 2010.

Figure 3.7: Market share of circulator pumps of different efficiency classes (2004-2010) (Oxford Research, 2012) This shows the energy labeling classes for pumps has expanded from 2004 to 2010 (A+ and A++ not included here, as they did not exist at the time). The A label product share of pumps has grown from below 5% to app. 30% from 2004 to 2010. In the App. I on page 65 there is an elaboration of the effects that the energy efficiency implementation measures has had so far. Summary The effects of the Eco-Design’s Energy-using-Products (EuP) directive from 2008, was shown the market in 2011 was minimized with the introduction of a requirement for IE2 (market share of 78 % in 2010) energy efficient motors, to exclude the worst performing. Also the EEI index showed a progress moving towards A labeled products in the case of pumps, and the trend is the same for most other products. As motors have a long life span, typically reaching up to 20 years, the real effects of the EuP directive cannot be measured, but is expected to have a positive effect as the motors sold will be functioning well into and beyond 2020. It could be speculated that the forth coming directive and standard on material efficiency, would have similar effects on the market and also in the end on products, like pumps, motors and VSD. Therefore this possible effect will be analyzed in the analysis. As shown in part 3.1.5 on raw materials and materials focus, there had been a cumulated drop in recycled content on Danfoss level of 4 %, so there are areas of improvements in their part of the metal processing industry. However Danfoss has been making headway in some areas of the Eco-Design Directive, and are at the moment developing further guidelines to live up to future requirements. The part 4 will make an analysis, leading to conclusions & recommendations. It is based on interviews and questionnaires to make the analysis, in order to give some concrete recommendations for implementing Eco-Design, specifically how material specific requirements in product development can be introduced at Danfoss Drives A/S and how to handle the major challenges to this.

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Part 4: Analysis of material efficiency criteria at Danfoss This analysis section is divided into three parts to answer the three sub questions to support answering the problem statement; “How can Danfoss Drives prepare for and integrate the material efficiency standard request, within their product development processes before 2019, for improving the products life cycle?” •

How does Danfoss Drives currently integrate the Eco-design directive and material efficiency in their product development practices? • How does Danfoss Drives use existing economic (and/or environmental) data for assessing possible areas of improvement in the product life cycle in regards to Eco-design options? • What are the biggest challenges implementing and applying the Eco-design directive with material efficiency in 2019 from the EU? To answer these, Interviews with appropriate personal along with ties to theory will be presented leading to sub-conclusions. Interviews were conducted, four from Danfoss Drives: a product development manager, a standardization specialist, a maintenance manager and head of industry affairs, and two from Danfoss Corporate Group being a global approvals consultant and the director for global approvals. These were chosen, as the product developer was thought of as knowing the product development process, in order to map the product development process as of now. The maintenance manager in order to see how these activities in regards to repair and recycling is handled and the standardization specialist in order to know the steps from developing a standard to final implementation. The head of Industry, Aksel Jepsen, was interviewed as being the “forerunner” for these activities at Danfoss Drives, and finally Global Approvals legal aspect, as when the standard; later directive and law is implemented. The full extent of these interviews can be seen in the App. L on page 71 or heard on the accompanying Data CD’s sound files attached last in the references.

4.1 Integration of Eco-design and material efficiency in product development This section answers the first sub question: “How does Danfoss Drives currently integrate the Eco-design directive and material efficiency in their product development practices?” To analyze the current Eco-design directives integration, here specifically the material efficiency aspects, the chosen method was to ask, how much each of the 8 material efficiency deliverables (described in Appendix A) currently played a part in Danfoss Drives product development process. Global Approvals did not answer this, as they strictly dealt with laws already in place, and not those standards under development they said. Global Approvals do however want to keep up with trends on and what is going on in the development of this standard request. Relevant quotes and statements will be used from the interview data, as translated to English from Danish by the Author (Authors’ translation) in order to support the analysis and answer the sub-questions. 4.1.1 - 8 Material Efficiency Deliverables Figure 4.1 shows the answers to the 8 material efficiency deliverables questions made. It is their subjective opinion to how much they incorporate these aspects today. The scale used on the y-axes is in the legend.

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As can be concluded from the figure 4.1, the four material aspects were rated the lowest focus at Danfoss Drives today, as they do not currently re-use their products or re-manufacture their products. Neither do they recover components or recycle components. Reason for this is that, as the power electronics components has a set life time, you first would have to know how to measure how much is left, and secondly to be able to guarantee the products functionality in the 1,5 year warranty period Danfoss offers. Two outliers being the product developer in regards to if they re-use products, and the maintenance manager in regards to remanufacture of products is present, most likely due to them being more on-hands with these two aspects, as they work with it daily. 8 7 6 5 4 3 2 1 0

Head of Industry func. Global Approvals func. Standardisation func. Maintanence func.

Materials

Use

8.Accessibility of components extraction

7.Ability to repair products

6.Upgradeability of products

5.Durability of products

4.Recoverability of components

3.Recyclability of components

2.Remanufacture of products

1.Reuse of products

Product Develop. Func.

1. No focus 4. Medium focus 8. High focus

Disposal

Figure 4.1: 8 Eco-Design material efficiency deliverable and Danfoss’ use of these today (Interview Data, App. L 2016) The products durability, sometimes having a life time past the designed 10 years of 15-20 years is where Danfoss Drives wants to differentiate themselves compared to competitors, with cheaper and less lasting products. All interviewees except the standardization specialist answered this aspect the highest. This goes hand-in-hand with the ability to repair their larger products of up to 5 MW, compared to the lesser 0,75 KW products, the larger the product the more financial gains and better price from Danfoss Drives’ perspective to have a service contract with service intervals to avoid these from breaking down. In terms of upgradeability, the answer is medium focus as they mostly at Danfoss Drives look at software upgrades, these being applications with smart algorithms to automatically detect different motor types the frequency converters are in a system with. This enabling to control and read data from the frequency converters with the aims at optimizing the energy output of the systems (motors, pumps, and frequency converters mentioned in the Extended Product Approach).

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Finally materials and components extraction was not looked so much into either, the only outlier being that the Product Developer, Lone Harvest was more inclined to rate it higher, since they re-used products or at least designed some of these aspects initially. In reality the re-use is limited to displays (as only one type of display was used for all product types) and that some products were repaired to prolong their life, no actual components or products were re-used at this time however. Reference was also made to official documents called “disposal agreements”, and environmental assessment which was mentioned in the materials focus of Danfoss in part 3.1.5. It is supported by the statement, according to Lone Harvest, Project Development Manager; “In general; We focus on, in connection with new product development projects, that we live up to current environmental demands that Danfoss has, and when we do Q-release (quality release), we have some environmental assessment within the REACH and RoHs directives that we live up to. So it is a part of the deliverables and milestones, which already starts at product specifications, what is environmental demands; here in question waste materials, not so much in the energy savings aspect, but the materials aspects, nontoxic material (no carcinogens) etc.” - (Product Developer App. L, 2016) She mentions that Danfoss has a so-called “Negative list”- here in question all the harmful materials and substances which they cannot use in the products, as described in part 3. When asked about how they conduct environmental assessments she said; “We have the environmental assessment; which basically is a check list where we assess the environmental hazardous substances, and it is a must-have from the quality function, which signs these, but I am a little unsure about this. It however has to be run though and you cannot progress in the product development milestones or Q-release, before this is handled, so in this way it is indirectly a part of the product development process. (The first environmental assessment is a part of mile stone M1 (Initial assessment) (See product development process figure) and final assessment before M5 – Q-release)” – (Product Developer App. L, 2016) The statement in connection with these assessment / checklists, and the disposal agreement that has to be made at Danfoss; is as explained by her; “…we also have a disposal agreement; I have not had a project which has progressed to this final stage in product development though. What I know is that we define spare parts, to see if we throw away parts of the product or the entirety of it (Spare parts strategy). We e.g. have some smaller drives, that are spare parts, or we replace fans or print boards also to some products to prolong their life. It is called Disposal Declaration, which lies before the final Q-release; including spare parts and materials, it is one of the deliverables, as a part of it. I have not used it however, and it is updated each year.” – (Product Developer App. L, 2016) She explained from all the above statements, that there were 3 stages where environmental and disposal aspect takes places currently, as shown in the figure 4.2.

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M1.(Initial Env. Assessment) M3.(Final Assessment) M5.(Disposal Declaration)

Figure 4.2: Danfoss’ Product Development Process - Edited (Product Developer App. L, 2016) The Maintenance Manager, Helge Nielsen answered that they remanufacture some product types (displays etc.), and this was again seen as mostly repair (his aspect), as the components/products do not currently play a part in the production process after the end-of-life, which was simply seen as too expensive to do today. Most of the interviewees said that the customers always had the option to repair smaller products, but as it often was cheaper just to buy a new frequency converter most customers didn’t use this option. How Danfoss Drives incorporates maintenance and repair thinking in the product development process is elaborated; “…We usually define how we can salvage the product using a brain-storm short term (containment action), and then we have the corrective actions which is in the long term and finally preventive actions which is how we can avoid this type of flaws on other products, so this does not happen again. It is a progressive process in which we run through each individual quality issues case. The prioritization depends on how big of a flaw we are talking about in the market, and how big the customer is, but in general we make a prioritization based on what type of flaw it is. We actually have 10 categories, and if it is a human safety violation flaw then it is a number 1 priority for us” – (Maintenance Manager App. L, 2016) The prioritization of maintenance activities; looks like this, according to him: 1. Containment actions are among the first five categories in their top ten prioritization, these are severe. 2. Corrective actions are second, meaning they are not seen as dire. 3. Preventive actions go a step beyond and looking towards future issues, which are not a problem so far. The material efficiency aspect would seem to be rated lower than human health issues of course, but not as high as in the top 5 categories of containment actions today. It is thus seen as a preventive action from maintenance perspective, looking towards future issues of saving materials in the directive. 4.1.2 - Eco-design in theory – influences on product development The figure 4.3 shows the answers to the theoretical principles of Eco-design questions as explained in the theory part 2.3. This in order to show the theoretical aspect of what Eco-design in its entirety entails, and to analyze to what degree Danfoss Drives has incorporated these in their current product development process. The scale is shown in the legend. Again, Global Approvals did not have any ratings to these principles, as they said they did not at the moment deal with these, as it’s not a legal binding law at the moment.

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8 7 6 5 4 3 2 1 0

Head of Industry func. Global Approvals func. Standardisation func.

Materials

Use

8.Size reduction (% volume of the product)

7.Service Design (Repairability)

6.Technology for sustainability (Upgradablility)

5.Systemic Design (Durability of the product)

4.Recycling and Reuse of the product

3.Material discretion: The use of mono & biomaterials

2.Reduction of Materials & Design for Disassembly

1.Design for components (modular archictecture)

Maintanence func. Product Develop. Func.

1. No focus 4. Medium focus 8. High focus

Disposal

Figure 4.3: 8 theoretical Eco-design options and Danfoss’ use of these today (Interview Data, App. L 2016) The questions intend to reflect the 8 theoretical design methods (mentioned in part two on theory) about the Nine Approaches to Eco-Design Product Development Methods (here not included the Eco-advertising option, as this was more seen as a marketing activity). It can be concluded from the figure, that the Materials aspects was not rated the highest. The maintenance manager rated design for components, reduction of materials and use of mono-materials higher (4-6) than any other interviewee’s answers. This is a conflicting view from before that no re-use or recycle and recovering was done to limit raw materials use at the end-of-life. The product developer had similar tendencies, with no high ratings. In the Use phase of the life cycle; the Systemic design option, Sustainable technology (Upgradeability) and Service Design (Repairability) were rated between 5-7, and the final Size reduction of products in Disposal phase was mentioned mostly as a logistics optimization problem, in regards to filling out lorries and trucks capacities and to not transport “air”. The packaging materials at Danfoss Drives are polystyrene and none of it is returned to Danfoss Drives, despite in Germany where it is a legal requirement to do so. The results on the materials aspect here are a bit higher, as this is purely design options. So does Danfoss Drives designs to take components out, reduce materials or use mono-based materials? These aspects were all rated higher here than in the figure 4.1 before, especially by the maintenance function and product development, but not the standard specialist, as he was a bit more skeptical, as to what it would mean to actually have these 4 design options in place. Recycling and re-use was still rated low, as Danfoss Drives does not design for this and does not practice this for products and components, but mostly on metals, like aluminum, as stated in the sustainability report; 224,476 tonnes of metals were used in production in 2015. Could there be some “untapped” potential for the aluminum metals recycling in their already made products as well? This untapped potential has not currently been looked at, despite them being aware of the material scarcity issues now and in the future.

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Sub-conclusion to Integration of Eco-design and material efficiency in product development The Eco-Design directive at Danfoss Drives’ product development covered environmental aspects like checklists (negative lists) and disposal declarations. The products design is of a high durability and repairability in the sense of larger products, as these were repaired and serviced now. Upgradeability of Eco-design is seen as software upgrades, i.e.no physical change done to the product. Energy efficiency is a main focus as the four material aspects of re-use, recycle, recover and remanufacture have not been looked into today, only in the sense that product development deemed products to be initially designed for re-use and maintenance, saying repair activities as being remanufacturing. Therefore somewhat covering half of the spectrum Danfoss Drives looked mostly at optimizing the use phase of the products and not the raw materials and disposal part of the life cycle in Eco-design options.

4.2 Existing economic (and/or social & environmental) data Assessments To answer the sub question. “How does Danfoss Drives use existing economic (and/or environmental) data for assessing possible areas of improvement in the product life cycle in regards to Eco-design options?” The interviewees were asked about the use of Economic, Environmental and Social data assessments in product development. The economic aspects can be many things; among these costs, price, transportation and volatility of profit. The interviewees all mentioned that economy was a main driver for product development, as Danfoss is a profit-based company. Secondly they stated that the environmental aspects are to exclude hazardous materials and substances from the production process and the product, through already legal directives from the EU, REACH and RoHs, mentioned earlier. This is supported by the two statements from the interviews; “The economics aspects we always look at, and if we are talking about only these three aspects, in product developments projects; the environmental aspects lies higher, with social aspects less. Yet again the environmental aspects, is part of the culture at Danfoss, as seen by management. We don’t do business cases on environmentally sound products, but economic costs and benefits as these are more measureable than the other two parameters. Everyone knows however that we as a company do not get to the point where we harm the environment. (Risk avoidance) We look also at products containing harmful substances and look at substitution options to get rid of these (as part of the Reach directive)” – (Product Developer App. L, 2016) In order for the products to be price competitive in the first place, balance is needed in the three aspects, mentioned below; “The economy is of course a big driver for product development, from the view point that it is a balance; because what does it matter to make the most expensive and recyclability products; IF we cannot sell these? Then it does not hit the market even, and hence not can be recycled. The market is then flooded by the cheaper non-recyclable products. Balance is key, as the environmental aspects need to be favored, and the social responsibility should also be a part of the company.” – (Standardization Specialist App. L, 2016) The economy, environment and social aspects (to sustainability) need to be balanced to not have the market flooded by cheaper less sustainable products. The product developer was asked how they clarify new customer requirements and demands, these could be price, functionality or environmental

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friendliness/sustainability aspects. In the beginning workshops are held with product managers and ultimately customers, as the product developers explains; “…they (customers) usually ask about energy efficiency of our products, and how we are performing here. In the startup phase of product development, we held a big work shop with product managers all around the world, to see what customers could want, for example that the drives should be as small as possible, that is an environmental concern also. We also look at transport strategy; produce where the customers are located, and if we have to transport something; we look at time and costs and that we don’t want to fly everything home/abroad. – (Product Developer App. L, 2016) Specifically the product developer mostly mentions logistics, costs and supply chain management aspects of the products requirements; i.e. how to transport most efficiently etc. This of course is an environmental concern along producing smaller products to transport less weight or volume. It however, has not much to do with environmental concern in the Use phase and raw materials extraction. She goes on to add that the customer requirement specifications process at the workshops is a rigid process, in which many key functions participate; “It is the project leader, the supply chain managers, research and development and product management. There we make a list of all the demands we have (god knows what) both size, function, and net flows = all the demands and requirements from customers, how important is it (nice to have or need to have). Then we prioritize these and at the workshop exclude some and include some and then we know which subject we are insecure about, to go to the customers and ask them finally. So it is all parts who are involved in this process, but primary driven by what the customers wants. – (Product Developer App. L, 2016) Customers are then lastly asked for final clarification and reflection, but as she states: “not many business customers (B2B) ask about material efficiency today, mostly energy efficiency. The end-consumers, you and me, have usually not that many material efficiency specific demands, other than avoiding harmful or toxic substances. However, the material focus may become a trend in Danfoss Drives’ future practice, with circular economy thinking seeing “waste as food”. The customers today see it, as less of a concern, so they according to the product developer have no environmental demands on material efficiency. Therefore, Danfoss Drives’ do not ask for these, because the customers themselves do not demand this focus. The Energy Agenda stated by Aksel Jepsen; is not yet “tapped out” and, Helge, the maintenance manager supports the systems aspect view of looking into materials and energy saving, as stated below; “Our focus is that we want to ensure our customers having less energy consumption and this is by using the products (use phase), not so much how the product is built (materials) and it is correct that it yields a much larger efficiency factor and economic rewards, if we can make products that have a long durability and high efficiency rather than just materials savings, as we gain something for the environment in the long term as our products are always part of a system.” – (Maintenance Manager App. L, 2016) Helge is aware of the potential savings in materials, but it is simply not where the greatest economic and environmental savings potential lies. According to him, it is the systems and extended product approach that yields the biggest savings potential. When asked about products they provide and how they optimize these, he said;

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“Our products are never a stand-alone product, when looking at a simple On/Off motor then most of these can be energy optimized by using one of our VLT drives (frequency converter) where the rotation is adjusted, and hence in regards to cooling, motion, compressors, pumps HVAC and others these can be optimized system-wise. So we are not done looking at energy efficiency yet….” – (Maintenance Manager App. L, 2016) In the energy agenda, potential savings and efficiency rates for the systems is here stated, as not done yet. As to how Danfoss Drives should move onto materials efficiency, it would, from his point of view, mostly be by optimizing durability and ability to repair the products. The “Spare Parts Strategy”; how many spare parts are needed is explained next by Helge, supporting these two aspects; “…we have a lot of spare parts for our products, where customers themselves can buy the spare parts (outside the warranty period) and repair the products; we have quite a bit of this going on today. We have big inventories on these; all from inductors to print cards, and this is specifically on the more expensive products, since the large 90 KW drives are built for easy reparability, more economic initiative for these than the smaller “buy and throw away products” of 0,75 KW products” – (Maintenance Manager App. L, 2016) Hence the economic incentive to repair products and have them last longer, today stems from customers wanting to repair the larger products (of up to 90 KW VSD). The smaller products are not repaired, as mentioned above; the environmental perspectives for these differ. As today the disposal agreements and maintenance repair service contracts are the two methods used, the economic driver and data is still the main driver, with environmental material scarcity being a second priority. Sub-Conclusion to Existing economic (and/or social & environmental) data Assessments Overall, the economic incentive for design of the products is in the use phase of the products, as it is thought to yield a higher economic reward, but also an environmental reward if the products are less energy intensive to use. The energy efficiency is again the biggest focus at Danfoss Drives today, as their products always are a part of a system and never a stand-alone product. Finally, product development sees mostly logistics and transport, and making the products smaller, as being an environmental concern and less about material efficiency and environmental demands from customers being their main concern. The customers do not have need-to-have environmental demands, and environmental data is not looked into for these material efficiency aspects in the life cycle. Overall less focus on these environmental concerns on materials are given, raising the question that energy alone is not seen as finished, before moving on to another aspect from the EU.

4.3 Challenges implementing and applying material efficiency in 2019 To answer the sub question; “What are the biggest challenges implementing and applying the Eco-design directive with material efficiency in 2019 from the EU?” Three actors, being part of the assessment and potential implementation on how the materials efficiency request is developed, is; 1. Industry association (CEMEP), analyzed through a standardization specialist 2. Industry (Danfoss Drives a part), analyzed though the head of industry 3. Group Legal and Regulatory department, analyzed through a global approvals consultant and director.

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Standardization Specialist To get an understanding of the process and steps towards final implementation of the Eco-design directive the question was asked to Preben Holm, Lead Electrical Safety Engineer: “is Danfoss Drives a part of the process today and how they can and will influence the standard’s development?” “We need to look into two aspects; One; legal aspect (from the EU) this we need. Our industry association (CEMEP) is also a part of this, and some of our competitors are a part of this development process too, which mostly we have common interests with our competition, which is good, as they sit in this task force. Second; When the mandate (M543) for standardization was published; we speculated on, when and how we should involve ourselves in this process. This is to be decided in our standardization coordination forum and sent to the management forum, when we have made the final decision to take part or not. We then need to “buy-in” with qualified inputs and feedback, but sometimes we have to say; “We simply do not have the resources and competences for this, so we drop this focus for now” – (Standardization Specialist App. L, 2016) The industry association for frequency converters and motors (CEMEP) has many common interests with Danfoss Drives. Danfoss Drives chooses, when to take part of the development of this standard, but as Preben states, this is to be decided in the standardization coordination forum which is depicted in the figure 4.4.

Figure 4.4: Standardization Coordination Group at Danfoss Drives A/S (Standardization Specialist App. L, 2016)

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It shows four groups beneath the standardization coordination group; this being 1. Electrical Safety, 2. Functional Safety, 3. Energy Efficiency, 4 Electro Magnetic Compatibility (EMC) and the one on the far right is to be determined when and if the Material Efficiency becomes a legal requirement. Four persons take part in the overall standardization coordination group at Danfoss. If the material efficiency is made into a law; then a reference group for the products needs to be in place as well. Compressors and motors (depicted left) have the same principles to standards, as drives. To see, how the material efficiency subgroup could be organized at Danfoss Drives Preben was asked: “who would be involved in such a process, what stakeholders within the standardization forum exists for this?; he answered; “First and foremost, you would need an expert in project management leading the material efficiency team; beneath him the developers and designer in product development and perhaps sales and other standardization personal. One of the functions is to affect the standards development and at the same time to extract this info to communicate to the rest of the company to the projects undergoing to avoid “just to keep boiling the hot water”, as it makes no sense to do this” – (Standardization Specialist App. L, 2016) The material efficiency sub team, with the above mentioned personal would be necessary and the information communicated to the other function (here Group Legal). In order not to stall the process of developing the standard towards 2019, Danfoss should be part of this development, to avoid getting “left behind”, but also in order to influence it. Finally when asked about “how the future steps from once a standard request is made towards final standard in 2019 and implementation at Danfoss Drives”, Preben answered; “My recollection of it … is that typically there is a Draft paper on this request, which the EU wants to send out, and the time to respond to this is then 14 days (if it makes sense) before they adapt this. Material Efficiency request was shot down once because of many critical feedbacks, so there was a second round before the final 17th December. When the consensus has been made the standardization request is thus sent out to the three standardization steering bodies of the EU (CEN, CENELEC and ETSI, described in the App. D on page 56) which the manufacturers then have the choice to either sit back and relax or get involved (first option is to play it risky). “– (Standardization Specialist App. L, 2016) This is up until the point, where the process of developing the standard and getting involved is discussed, after that Danfoss Drives decides yes/no to move, the option for saying yes to be involved, Preben describes thusly; “We then decide, yes, we want this standardization mandate, then there is two groups working on each their area, and then the formal standardization process is starting, adhering experts personal in different work groups and the process from here is usually 3 years, which is what the EU deems necessary (like ’16 19 for materials later on when the structure as mentioned before has been set and the overall time frame made). CENELEC and CEN have both said yes to take this mandate standard request for materials, but in which committee the standard developments lays and how the work is formulated, has not been decided, because both two steering group organization have said yes, they need to make a joined group and discussion for this first.” – (Standardization Specialist App. L, 2016)

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Whether CEN or CENELEC moves further with the development of the standard request is still to be decided. As it looks now with current trends, it will be picked up by one of them. Head of Industry Affairs To analyze the “Industry Affairs”, critical viewpoints; Aksel Jepsen, Danfoss Drives A/S, stated that it could be considered having these material efficiency aspects as part of the product development, but as shown in the statement below, he comments with a concern, to focus on one thing at a time; “However, at this stage we are strongly of the opinion that mixing of energy efficiency and material efficiency will cause the process to lose focus - concentrate on one thing at a time” – Danfoss Drives Comments to Eco-Design (App. M on page 107) He furthermore adds to this statement, that when taking part in the third work program for the EU, he experienced that; ”…It is a directive covering both energy and material aspects of product that are energy related (ErP), and it is actually a discussion stemming from the third work programme, which was presented by the end of 2015, I myself took part of this stakeholder meeting in Brussels. As they were presenting it became clear (to me) that they (EU) were running out of “good” products to regulate upon…” – (Head of Industry App. L, 2016) Later in the interview he comes with the example the EU gave, on house hold water boilers, and adds; “How effectively can you boil 1 liter of water; really?” The Eco-Design Directive, has stumbled upon a dilemma, as they before regulated a lot on product and component level, and have according to him run out of options here, so what to do now? Jump on material and resource efficiency, even before they have finished the energy efficiency agenda. This seems unnecessary to Axel, as also stated by his quote below on the systems level of thinking (EPA); ”…We think it is a wrong way to go, because energy efficiency has not reached the finish line, we only finished regulating on components level, but as stated by many reports (we use one from the EU 2009) it is within systems that you can save a lot more energy, than just components level. Meaning that if you optimize an entire system (here motor system, with pump, motor, VLT frequency converter etc.) there is a lot more savings potential (factor 10) than by just regulating on individual components.” – (Head of Industry App. L, 2016)

In the report he mentions, it is stated that 10 % of the overall energy savings can be addressed by looking at components efficiency (pumps and motors individual etc.), 30% can be addressed by looking at a motor driven system (motors, frequency converter, pumps and the load bearing degree the systems is running at). Additional 60% expected energy savings is then again in the systems context to the motor driven system, which the EPA is within, like a water treatment plant, with bigger pipes and flows. (EU report, 2009) What is mentioned with the 30 % is the Extended Product Approach (EPA) which for the pump industry EUROPUMP and Grundfos has had great influence on their and the competitors energy savings on the immediate systems level. Grundfos had common interests in their industry association, which meant that

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EUROPUMP could apply this approach. In CEMEP, the issue is that the Heating and Cooling ventilators had a very different capacity degree and that Danfoss Drives’ competitors’ systems were different (having premanufactured built systems – with frequency converter in the motor system). Danfoss Drives wanted to differentiate on high flexibility and stand-alone frequency converter to all motor types. The industry association therefore could cooperate on some issues, but had different viewpoints, when it comes to systems optimization, as to why Danfoss Drives in CEMEP, has not been able to include EPA approach to product design. The association conflicting views halts progress on EPA and systems thinking, as stated by Aksel, but the industry and industry association would probably not state this themselves. In regards to why the EU doesn’t follow up on this systems-approach and EPA approach; he says that their major challenges is; ”...but their (EU) problem is thusly; How do you regulate and make a law for this; what should be done? Their “working tools”, only reaches component level and it stops when reaching the more complex systems, since the EU commission is not capable of gathering the massive data basis that is deemed necessary to find the out most border limits, to where the industry should be within. In the commission, they also state that, you cannot pass a law that goes completely across and between industries, without the industry joining in. So industries need to be a part of this process, with or without data input, which it where it all falls apart. Most would say it is the authorities standing in the way of progress, but in this case here it is the industry themselves that stand in the way.” - (Head of Industry App. L, 2016) The EU simply cannot grasp the task of collecting the massive data input needed for these material efficiency deliverables metrics themselves, but need industry to take part, as the product specific standards on material efficiency to be developed, needs industry specific data in the end.

Danfoss Group Legal and Regulatory Danfoss legal’s aspects and challenges to material efficiency implementation are further elaborated, in order to see how Danfoss Corporate Group would advise on this standard request. The analysis investigates where Global Approvals has a part of the process. When the standard is opted to becoming a law, with legal compliance this function provides the legal guidance. The interviewees were a consultant Hans Schou Christensen and the Director for Global Approvals Eigil Hansen.

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The legal group at Danfoss: Group Regulatory consists of the organization, shown in figure 4.5.

Figure 4.5: Danfoss’ Group Regulatory Organizational Diagram –Global Approvals (Global Approvals App. L, 2016) Global Approvals, is a part the Regulatory department within the Group Legal functions at Danfoss. They act as a consultancy, advising all four segments at Danfoss; Danfoss Heating, Danfoss Cooling, Danfoss Power Solutions and Danfoss Drives. As shown Global Approvals cover; product approvals , certificates & audits along with the Directive and standards already in place REACH and RoHs mentioned earlier, and the Eco-design directive, Environmental Product Declaration (EPD) and full material declarations. When asked, how they at Global Approvals work with material efficiency aspects, Hans Schou Christensen, answered; “As stated; before we can use the material efficiency aspects, it needs to be formulated into a set of directives by the EU, something more concrete, as I have only seen good intentions and wishes so far, but nothing more than this level. I don’t know about the voluntary agreements, so from our department’s side we have just started to delve into this.” – (Global Approvals App. L, 2016) The exact law is at the moment not formulated, so global approvals have just now started speculating about this request. In regards to how their department functions, when hearing about a new material efficiency standard request like this, Eigil Hansen, Global Approvals Director, said; “Well it functions the way that we in the organizations have Public Affairs (and Industry Affairs) personal and these are the ones mostly taken in as a part of this process and communicating these demands to the organization. I am therefore sitting in meetings where we get references to what is going on at the moment and there the decisions of who does what, is usually taken in this forum. Now it has been decided that Preben Holm (Our standardization Specialist) takes part in these, and I asked him about when more has

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been discovered, if we need to “jump in on this” development at the moment or letting him be the natural “food chain” to this info, and give it to corporate function later on. – (Global Approvals App. L, 2016) Therefore, at the moment the material efficiency information input comes from Preben Holm, Danfoss Drives standardization specialist. The reason for this is further elaborated below; “We do this from the standpoint to figure out what resources are available to use right now, but also that we hopefully can trigger “the right moment” so that we can get concrete info and resources to be a big player in this process as well.” – (Global Approvals App. L, 2016) Preben Holm hence is, at the moment still acting as a kind of “One man army” to deliver intelligence of when and how to react to this standard request development on Material Efficiency. Danfoss Drives; with the standardization coordination group, is currently seen as the natural “food chain” of information. When asked about, if they at Global Approvals take part in the development of the standard or laws, a very clear line was drawn between standard development and law development, and the usual process of a law and subsequent standard being developed to this, is “turned around” here, where the standard and law comes after or is made in parallel. Hans Schou Christensen said; “Well, no on the legal aspect to change the laws, but on the standardization aspect then we take part in this, not exactly on Material Efficiency, but in regards to other standards. In law it is mostly lobbyists in Brussels who are working to affect and be a part of this. It is a level below law (as seen by us) the standardization work. It is a little unusual that the standard comes first here before the law. We have of course, in about 2 days, been switching to some new directives which have come from the EU in 2014, on EMC directives and there standards previously existed (unlike here.) So there we are “just” updating these directives to the newest one, making smaller adjustments affecting us in a lesser manner” – (Global Approvals App. L, 2016) To explain a “directive”, is seen as a framework in which the product specific “laws” to comply later lies within. A “standard” can have a horizontal aspect covering product groups and also specific products individually. The VLT drives would most likely later be opted for an individual product standard. In the above mentioned circumstance, the directive and standards “updated” are seen as easier to implement. Like with CE marking, the standards are here harmonized, as listed in official journals, to make it easier to assume, that these are covered completely by the directive beneath CE marking and labeling. With material efficiency, there exists no such official journal today; it is seen as a lower level than official laws with this mandate request M543 on material efficiency. Hence, not much can be said and done from the Group Legal Function and Global Approvals today, as they need the complete set of directives and the final law regulation to be able to work with these in the corporate function of Danfoss. So far, they only work with certification and approvals deemed necessary by Danfoss Management, and material efficiency is not yet a part of this. Hans mentions that Eigil will be a determining factor to move/or not move on this standard, and when asked Eigil Hansen had the following to say about the choice, not being his alone;

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“Then we will take this(decision) up for discussion in our part of the organization, because we in regulatory have a link into the different segments, where we will inform these, and in principle it is the individual segments that can say, based on our recommendations, should we involve ourselves in this (standardization)work or move later on. So it is not us alone who makes the decisions, but in collaboration with the different segments managements teams” – (Global Approvals App. L, 2016) As a department, the Group Legal and Global Approvals had no official opinion to the standards development, up until the point, where it would become an official legal compliance law, and it would then hit their desk so to say. They could have a subjective opinion, as stated by Eigil Hansen, but in the end if it is not a legal compliance law, it was stated that Danfoss Top Management had to make the final call to implement this material efficiency or not. The management would hear about this standard through their executive committee, and it being a political decision on what political intentions Danfoss will have. When asked who has the responsibility ultimately for overseeing and monitoring material efficiency goals, Eigil Hansen, had this to say; “Today we are a consultancy function, so when a decision like this has been made at Danfoss, then it is the four segments responsibility themselves to have this implemented. They can normally not do this alone, without our legal advice however. So it is in this manner we help with implementing new standards, as a consultant answering; how, when and where it can be implemented. The basis info comes from us, but the segments remain responsible, we do not take full responsibility for this.” – (Global Approvals App. L, 2016) To help with implementation Global Approvals would have to advise segments and play a role for the four individual segments legally, but the responsibility for successful implementation at Danfoss Drives would still in the end be theirs alone. They group legal’s goal is to provide them with sound and good judgment and legal advice, which is the typical link that Global Approvals would play in this implementation process for material efficiency. Sub-conclusion to Challenges implementing and applying material efficiency in 2019 One of the main reasons for the change to the material efficiency is that the EU’s major challenges of looking at systems, is being able to gather the massive data and metrics for each products, in terms of energy saving potential (with a factor 10 in systems level thinking, than components and individual product level). The industry association is also stated to be halting the process and being a challenge for Danfoss to overcome. However, industry collaboration is a necessity to overcome this challenge in order to implement the standard on materials. The metrics to be developed in these material efficiency standards needed industry data, to make product specific standards to be able to develop the final law regulation. The legal challenges were; no exact directives or metrics currently made to be able to abide the law and the info they were receiving was mostly from Preben Holm, the standardization specialist, on what to do. Lastly, Global Approvals do not affect the laws made, but Danfoss lobbyist in the EU affects the standards content. Group legal needs much more info to be able to provide legal guidance and advice, to the rest of the segments at Danfoss.

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Summary of the analysis of material efficiency criteria at Danfoss Based on sub-conclusions then the major challenges of implementing the material efficiency standard in 2019 are summed up to be:  Standardization process needs far more expertise in personal for upcoming material efficiency, with specific product manager and a reference group of products for materials metrics.  Industry association is halting the progress with conflicting views on system optimization. The Extended Product Approach (EPA) is not available to optimize because of the competitors data lacking.  EU not having the massive date gathering capacity required for the implementation of product specific standards on material efficiency.  Legal not yet aware of what it entails to provide good and sound legal judgments for material efficiency aspects, and missing some of the information on this in relation to the standard request of today. Following Conclusions and Recommendations to the research question; “How can Danfoss prepare themselves in regards to the Material Efficiency Standard’s request, for improvements of the product life cycle within their product development processes in the future?”

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Part 5: Conclusions and Recommendations Conclusions to the analysis and to the three sub-questions to answer; “How can Danfoss Drives prepare for and integrate the material efficiency standard request, within their product development processes before 2019, for improving the products life cycle?” Summing up the four major challenges identified in the analysis, recommendations and solution proposals to implementing the material efficiency standard in 2019 for Danfoss Drives A/S, is made: Recommendation to first challenge “Standardization processes needs far more expertise in personal for upcoming material efficiency, with specific product manager and a reference group of products for materials metrics” are to streamline this process of incorporating material efficiency within product development, by being based on the QFD-modeling, where the 8 material efficiency aspects of Eco-design options( re-use, recycle, recover, remanufacture, durability, upgradeability, repairability and extraction of raw materials) would be individual specific metrics to have their own rates and criticality for the products environmental impacts. This should be done in the detailed design phase of the product development process. Maintenance suggests (explained in the reflections) to include these rates in their database systems. They at Danfoss already report the products and components weight; why not have the recyclability and recoverability rates measured in the initial design phase of product development as well. These aspects will help with creating the so-called reference groups of products brought up by the standardization specialist, which will have to be created by the material efficiency team. The final necessary aspect of evaluating time and resources (financial and personal) can be taken from the proposed method and inspirations for a Mock-Up template made by [Mathieux et al., 2014] in App. F page 61. An example of what a manufacturing sequence could look like for Danfoss Drives is presented here. “Mock-up” illustration of the QFD house of quality approach:

Figure 5.1: Template example, for going from customer needs, to qualified products with material efficiency aspects incorporated, Inspiration from (Usher et al., 1998) 43

Recommendation to the second challenge “Industry association is halting the progress with conflicting views on system optimization. The Extended Product Approach (EPA) is not available to optimize, because of the competitors data lacking.” One proposed solution is to look into possible areas in which the Industry Association for Danfoss Drives (CEMEP) can collaborate, as there is a need for cross-combined methods for assessing the system optimization of products, not just for the material aspects, but also for the energy efficiency aspects. The entire Extended Product Approach (EPA) is not done with the energy focus, as mentioned by many of the interviewees at Danfoss Drives today. Since the VLT frequency converter alleviates the more energy using motors, to use less energy with introducing variable speed drives, the main concern today for Drives is still energy efficiency. Drives therefore try to get their message across with this to the industry association. In theoretical terms if one were to utilize the EPA method for their products, the collaboration for Drives would have to be with motor and pump manufacturers in which their product (the variable speed drives) takes place. The entire business approach would have to be altered to incorporate this shift, as Drives will be forced to look at their products as a service of saving energy. In order to make this shift a possible joint business platform (joint venture) on these EPA products could be made. This to optimize the energy and materials efficiency and address the material scarcity problem of rare earth metals today. The recommendation to the challenge of “EU not having the massive data gathering capacity required for the implementation of product specific standards on material efficiency” is; In order for the standard to be finalized, metrics and measurement assessments of material efficiency are needed within product specific standards. The EU requires a massive Data-base for these products, as stated by the Head of Industry at Danfoss Drives. This data cannot be retrieved and gathered by the EU according to him. The solution proposed here will be some Data-sharing platform, for the Industries affected by the material efficiency standard. In order to extracts such data one should think in terms of IoT (Internet of Things) and Big Data Concepts. Access must be allowed to these reference product groups in order to develop the aforementioned necessary metrics in a combined method. In order to set-up these data-base metrics for Danfoss, the maintenance manager stated their ERP (enterprise resource & planning) systems already have the weight of components and products listed, so some of the issues to data lacking could be addressed this way. This thinking can be provided by the EU, through cloud-based data-sharing software. Providing a level of anonymity in order to secure restricted data and product concepts/designs, not to be “leaked” to competitors. Legal documents and clauses are needed to be signed to avoid datarestrictions be broken. The final challenge in “Legal not yet aware of what it entails to provide good and sound legal judgments for material efficiency aspects, and missing some of the information on this in relation to the standard request of today.” A final recommendation is for global approval to look into what the proposed exact metrics are for this upcoming material efficiency standard in 2019. The entire measurement of time for extraction of components by [Mathieux et. al 2014] in the Appendix F is good starting point, as it mentions some of the metrics for materials efficiency to be in and out of the final legal binding standard. The recoverability, recyclability, reusability and re-manufacturing rates will also have to be legally assessed in terms of how much is demanded of a product to be recycled/recovered etc. This to be done before the proposed up-coming law on how much is deemed necessary for the product and its reference group is made final. From the differing viewpoints on what is needed to be done by who at Danfoss, it is proposed that different teams or

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standardization coordination groups in collaboration with Global Approvals need to be put in place, different resources and time need to be allocated in each of the phases of standards development, and as the Global Approvals department just got on board with this project, evaluation on if the right people with the right competences are a part of this process needs to be made, in order to avoid the legal department missing vital information on this standards development today. Finally, in order to help Global Approvals with this, the organization of the possible new to-be material efficiency project team under the standardization coordination group could possibly look like shown in figure 5.2.

Figure 5.2: Template Mock-Up of the proposed material efficiency team under the standardization coordination group at Danfoss Drives A/S inspiration according to (Standardization Specialist App. L, 2016)

The reflections part of the report looks at the system-perspective in ISO 14001, and what types of radical innovation besides material efficiency Danfoss Drives could take inspiration from.

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Part 6: Reflections Last to expand on the conclusion and recommendations; reflections and perspectives to the International Standards for Organizations (ISO) is made, with their guidelines for integrating environmental aspects into product development (ISO 14062) and implementing Eco-design in an already established ISO 14001 environmental management system (ISO 14006). Reflected upon this upcoming ESO standard on Ecodesign material efficiency, answering the final reflective question; “How does Eco-design, here specifically Material-Efficiency Standard support ISO 14001 Life Cycle perspectives aspect of Product Development?” When asked how the material efficiency goals could be successfully implemented, Helge, the maintenance manager came up with the idea of a Database structured approach; as he said; “I think what could be easier to monitor and measure, would be e.g.; we know the weight of all materials and components used, and here we could make a database of all these listed, which tells you what your design costs in energy and recyclability terms, (recyclability in mass rate factor etc. for the entire product). This is already in the system, so we need to make the software for this, as we already today have to report the weight of components in the database systems. So I could see this becoming a reality. You could then say that this product had so-and-so of these energy/material parameters, so when designing the product you would then become aware of these impacts later on to improve recyclability factors and other material efficiency aspects.” – (Maintenance Manager, 2016) It is easiest for Danfoss Drives to measure; the recyclability and repairability rate (stated within standard made for VLT drives EN 50598) as shown in figure 4.1 on page 28; reuse, recycle, remanufacture and recover were not options that Danfoss had made at the moment and found it hard to analyze and measure the amount of these aspects. As upgradeability was mostly seen as software upgrades and not much else, no physical material upgrades is taken out or added. How to incorporate these into a more structured environmental management system (like ISO 14001), is speculated. ISO 14001 is briefly a system incorporating the Plan, Do, Check and Act model, and is structured around themes such as; Environmental Strategy and Policies, Process Descriptions, Personal Guidelines on these and Managements Reviews of these subjects. The system guides users through the environmental processes and steps for the entire company, as it’s an overall structure. Product Development with ecodesign lies in the process description part of an environmental management system for employees to refer to. As ISO 14001 is the recognized environmental management system for many companies it is reflected how Eco-design can be a part of this system. The overall document in ISO that binds these three together is ISO 14006, guidelines for incorporating Eco-design in environmental management system. In the figure 6.1 the overall relationships are shown.

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Figure 6.1: Relationship between ISO 14062, 14006, 14001 and ISO 9001 (ISO, 2011) ISO 14006 provides the guidelines to assist organizations in establishing, documenting, implementing, maintaining and continually improving their management of Eco-design as part of an environmental management system (EMS). It is being used by organizations that have implemented an EMS in accordance with ISO 14001, but can help in integrating Eco-design in other management systems as well. The guidelines are applicable to any organization regardless of its size or activity, along with this it applies to those product-related environmental aspects that the organization can control and it can influence. (ISO, 2011) Finally to wrap up the system-optimization discussion; it is being discussed that the systems aspect on innovations, can save up to 10 times more energy, than just looking at individual product specific improvements. The figure 6.2, shows the four innovation measures by least radical to most radical and “disruptive” innovations in Eco-Design according to (Brezet & Rocha, 2001):

Figure 6.2: Four Types of Eco-design with different environmental improvement potentials and time horizons (Brezet & Rocha, 2001)

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The first option is the “low hanging fruits”. The main core of product improvement is within energy efficiency for Danfoss Drives products. Second option: product concept stays the same, but individual products components are improved/completely replaced in order to save materials; the material efficiency optimization is within this realm, with better improvement potential than just product improvements. The third option is changing the functionality of the product or service in question, i.e. product/service system. Last option is the most radical and disruptive eco-design innovation. Here the entire technical system; i.e. product, product value chain, the adjacent infrastructure and the institutional structure are replaced by a new system. (Arler et al., 2015) To improve the sustainable development, radical innovation will make the grand total difference, and not product improvements/optimizing product development alone. Material-efficiency standard is a step in the right direction, but more could be done today.

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References Books (Bakker et al., 2014) Products that last: Product design for circular business models by C.A. Bakker, M.C. den Hollander, E. van Hinte & Y. Zijlstra, ISBN: 978-9461863867 (Usher et al., 1998) Integrated Product and Process Development: Methods, Tools, and Technologies by John M. Usher, Utpal Roy, Hamid Parsaei, ISBN: 0-471-15597-7 (Arler et al., 2015) Bæredygtighed: Værdier, Regler og Metoder, Edited by: Finn Arler, Mette Alberg Mosgaard & Henrik Riisgaard. Århus Universitets forlag 2015 – Chapter 17: EcoDesign – Rikke Dorothea Huulgaard & Mette Alberg Mosgaard (Barbero et al., 2009) Ecodesign: Ecofriendly objects for everyday use by Silvia Barbero & Brunella Cozzo Published by H.F.Ullmann Publishing, Potsdam, Germany ISBN: 978-3-8331-5461-4 (Dennis et al. 2005) System Analysis and Design fifth edition: Chapter 3 - Requirements Determination by Alan Dennis, Barbara Haley Wixom, Roberta M. Roth Published by John Wiley & Sons Publication City/Country: New York, United States Edition International edition ISBN: 978-0471726005

PhD’s (Huulgaard, 2015) ECO DESIGN: A Study of the EcoDesign Directive and EcoDesign Practices at Grundfos, Bang & Olufsen and Danfoss Power Electronics by Rikke Dorothea Huulgaard, Aalborg University Denmark, 2015 EU Directives Mandates (ECO Directive, 2015) ECO Design Directive - M543 EN, 17.12.2015 - Commission Implementing Decision of 17.12.2015 Articles (Mathieux et al., 2014) Measuring the time for extracting components in end-of-life products: needs for a standardized method and aspects to be considered by Fabrice Mathieux, , Marco Recchionia, Fulvio Ardentea, European Commission, DG Joint Research Center, Institute for Environment and Sustainability, Ispra, Italy. 21st CIRP Conference on Life Cycle Engineering, 2014 (Andreasen et al., 2006) What happens to Integrated Product Development models with Product/Service-System Approaches? By A.R. Tan, T.C. McAloone, M. Myrup Andreasen. 6TH Integrated Product Development Workshop IPD 2006 Schönebeck/Bad Salzelmen b. Magdeburg Deutschland, October 18-20, 2006 (Brezet & Rocha, 2001) Towards a model for product-oriented environmental management systems, Sustainable Solutions: Developing Products and Services for the Future by Brezet, H. & C. Rocha, Sheffield: Greenleaf Publishing 20014th (Flick, 1998).Semi-standardized Interview guide: An introduction to qualitative research by Flick, U. Thousand Oaks, CA: SAGE Publications, Inc. 1998

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Reports (Danfoss Sustainability Report, 2014) Sustainability Report 2014 by Danfoss A/S · The Danfoss Group · ®Danfoss

(ESDN, 2009) European Sustainable Development Network Quarterly Report: Horizontal Policy Integration and Sustainable Development: Conceptual remarks and governance examples (Ellen Macarthur, 2015) Towards a Circular Economy: Business Rationale for an Accelerated Transition, November 2015 • Published by the Ellen MacArthur Foundation (Bundgaard et al., 2015) Ecodesign Directive version 2.0 - From Energy Efficiency to Resource Efficiency, Environmental project No. 1635, 2015 by the Danish Environmental Ministry in collaboration with Aalborg University, edited by Arne Remmen, Anja Marie Bundgaard & Kristian Overgaard Zacho (Oxford Research, 2012) Evaluation of the Ecodesign Directive (2009/125/EC) - Final report, March 2012 by the Center for Strategy & Evaluation Services (CSES) at Oxford Research, Oxford University (McAloone, 2003) Environmental improvement through product development - a guide by the Institute for Product Development (IPU) at Technical University of Denmark in collaboration with the Danish Ministry of the Environment and the Confederation of Danish Industry, 2003, Authors: Tim McAloone, DTU Management Engineering & Niki Bey, IPU Product Development http://www.ipl.dtu.dk/English.aspx (Europump, 2013) EXTENDED PRODUCT APPROACH FOR PUMPS: A Europump Guide, 8 April 2013 Draft version Copyright © 2013 by Europump. Published by Europump. All rights reserved. (EU report, 2009) Improving the Penetration of Energy-Efficient Motors and Drives, Joint Research Center Institute of Energy and Transport (IET) made by ISR – University of Coimbra 2009 Authors; Aníbal T. De Almeida, Paula Fonseca, Fernando Ferreira, Florence Guisse, Jean Blaise, Emmanuel Clair,, Alioune Diop, Alfredo Previ, Alfonso Caccia Dominioni, Mario Di Pillo, Salvatore Russo Hugh Falkner Juergen Reichert, Ekkehard Tönsing & Klaus Malmose • The project was sponsored by: European Commission, Directorate-General for Transport and Energy, SAVE II Programme 2000, Contract Nº.: 4.1031/Z/96044 PowerPoints (M. Galatola, 2014) Michelle Galatola : ILCD, PEF and PEFCRs—Toolbox for the future market standard for assessment of product environmental footprint and communication. Product Environmental Footprint workshop September 24. Nordic Environmental Footprint group, The Nordic Council. Stockholm (EU commission, 2012) Ecodesign Your Future: How Ecodesign can help the environment by making products smarter, presentation brochure by the EU commission 2012 - European Union, 2012 Reproduction is authorized http://ec.europa.eu/DocsRoom/documents/5187/attachments/1/translations/en/renditions/native (Sckerl, 2010) Workshop on Ecodesign and Resource Efficiency - A Case on Electrical Motors, November 26th 2010 by Mads Sckerl,Senior Sales Director at Grundfos http://www.resourceefficiency.aau.dk/UploadImages/Ecodesign_Nov-2010_2.pdf

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Websites (Danfoss a, 2016) http://www.danfoss.com/about/facts-and-history/our-history/ Accessed 14.03.2016 (Danfoss b, 2016) http://danfoss.ipapercms.dk/DanfossHistoriskArkiv/FragmentsofDanfossHistory/ Accessed 14.03.2015 (Danfoss c, 2016) http://www.danfoss.com/about/organization/ Accessed 14.03.2016 (Danfoss d, 2016) http://www.danfoss.com/NR/rdonlyres/Product_Catalogue.pdf Accessed 16.05.2016 (ESOa, 2015) http://www.cencenelec.eu/standards/Pages/default.aspx Accessed 09.02.2016 (ESOb, 2015) http://www.cencenelec.eu/standards/ESOs/Pages/default.aspx Accessed 09.02.2016 (Action programme, 2015) http://ec.europa.eu/environment/action-programme/ Accessed 19.02.2016 (ECO EU, 2015) http://ec.europa.eu/growth/industry/sustainability/ecodesign/ Accessed 09.02.2016 (Resource Efficiency, 2015) http://www.eceee.org/ecodesign/Horizontal-matters/Resource_efficiency Accessed 29.02.2016 (ECCC Lots, 2015) http://www.eceee.org/ecodesign/products Accessed 19.02.2016 (SEAD, 2015) http://www.superefficient.org/ Accessed 19.02.2016 (Cecimo, 2015) http://www.cecimo.eu/site/ecodesign-and-self-regulatory-initiative/ecodesign-directive/ Accessed 29.02.2016 (UN Global Compact, 2016) https://www.unglobalcompact.org/what-is-gc/mission/principles Accessed 14.03.2016 (ISO, 2011) ISO 14006:2011Environmental management systems - Guidelines for incorporating ecodesign http://www.iso.org/iso/catalogue_detail?csnumber=43241 Accessed 15.03.2016 (ISO, 2002) ISO/TR 14062:2002 Environmental management - Integrating environmental aspects into product design and development http://www.iso.org/iso/catalogue_detail?csnumber=33020 Accessed 15.03.2016 (Energy label, 2015) http://www.newenergylabel.com/index.php/dk/home/ Accessed 02.04.2016 (VFD, 2016) http://www.vfds.com/blog/what-is-a-vfd Accessed 16.05.2016

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Interviews (Head of Industry, 2016) Aksel Jepsen – Head of Industry Danfoss.aac Interview on the 18.04.2016 (Product Developer, 2016) Lone Harvest – Product Development Danfoss.aac Interview on the 19.04.2016 (Standardization Specialist, 2016) Preben Holm – Standardization Danfoss.aac Interview on the 18.04.2016 (Maintenance Manager, 2016) Helge Nielsen – Maintenance Danfoss.aac Interview on the 19.04.2016 (Global Approvals, 2016)) Hans Shcou Christensen & Eigil Hansen – Global Approvals Danfoss.aac Interview on the 18.04.2016

Data CD (Compact Disc): with Interview sound files Includes; Aksel Jepsen - Head of Industry Danfoss.aac

Hans Schou & Eigel Hansen - Global Approvals Danfoss.aac Helge Nielsen - Maintenance Danfoss.aac Lone Harvest - Product Development Danfoss.aac Preben Holm - Standardization Danfoss.aac

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Appendices Appendix A) 8 deliverables from the Material-Efficiency Standard Request Requirements concerning the content of requested deliverables. Such harmonized standards are always subject to separate product specific standardization requests. The requested deliverables shall as far reasonably practicable deal with the 8 following topics: I. II. III. IV. V. VI. VII. VIII.

“Definition of parameters and methods relevant for assessing durability, upgradability and ability to repair, re-use and re-manufacture of products;” “Provision of guidance on how standardization deliverables for assessing durability, upgradability and ability to repair and re-manufacture of products can be applied to product-specific standards;” “Ability to access or remove certain components, consumables or assemblies from products to facilitate repair or remanufacture or reuse;” “Reusability/recyclability/recoverability (RRR) indexes or criteria, preferably taking into account the likely evolution of recycling methods and techniques over time;” “Ability to access or remove certain components or assemblies from products to facilitate their extraction at the end-of-life for ease of treatment and recycling;” “Method to assess the proportion of re-used components and/or recycled materials in products;” “Use and recyclability of Critical Raw Materials to the EU, listed by the European Commission;” “Documentation and/or marking regarding information relating to material efficiency of the product taking into account the intended audience (consumers, professionals or market surveillance authorities).“ (ECO Directive, 2015)

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Appendix B) 10 Principles in the Global Compact Initiative Human Rights  “Principle 1: Businesses should support and respect the protection of internationally proclaimed human rights;”  “Principle 2: Make sure that they are not complicit in human rights abuses.“ Labour  “Principle 3: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining;”  “Principle 4: The elimination of all forms of forced and compulsory labour;”  “Principle 5: The effective abolition of child labour;”  “Principle 6: The elimination of discrimination in respect of employment and occupation.” Environment  “Principle 7: Businesses should support a precautionary approach to environmental challenges;”  “Principle 8: Undertake initiatives to promote greater environmental responsibility;”  “Principle 9: Encourage the development and diffusion of environmentally friendly technologies.” Anti-Corruption



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“Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery.” (UN Global Compact, 2016)

Appendix C) How are mandatory product requirements decided? In order for Eco-design requirements to be set for a product group a number of steps have to be followed. These include as shown in the figure.

Figure I: Outline of five steps to deciding mandatory product requirements by the EU (EU Commission, 2012) Five steps as described in detail by the EU; (EU commission, 2012) 1. “The European Commission adopts a Working Plan, which sets out an indicative list of priority products to be explored for their Eco-design potential over the next three years.” 2. “Each product group mentioned in the Working Plan is analyzed in a preparatory study, in order to assess whether and which Eco-design requirements are appropriate (according to the Eco-design Methodology).” 3. “A draft Commission Regulation is submitted to the Consultation Forum (representatives of EU and EEA Member States and of 30 stakeholders such as business federations, NGOs and consumer organizations) for comments. A thorough impact assessment follows, which details essential figures such as energy saving potential or costs for industry.” 4. “The draft is submitted to the vote of the Regulatory Committee (representatives of EU Member States).” 5. “The draft Commission Regulation remains under the scrutiny of the European Parliament and the Council for 3 months until Final regulation.” These five steps are explained to show where the material efficiency standard is going to progress through. Consultation forum and first proposal, moving on to a draft regulation of the material efficiency standard later to be approved and final regulation implemented in 2019. To see the standardization institutions and a brief description of these ESO’s (European Standardization Organizations) go to App. D.

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Appendix D) European Standardization Organizations (ESOs) This section elaborates the steering organizations of which the standard for the Material Efficiency request underneath the Eco-Design Directive, will be developed and hopefully become a reality in 2019. Three levels and three different organizations are presented next.

Figure II: Horizontal, Vertical and Diagonal Policy Integration on three levels, adapted by Reinhard Steurer (ESDN, 2009) The international level is International Standard Organization (ISO) above the EU which is seen here as the the “national level” above the sub-national level, with sub-national being Denmark and within this organizational company contexts. Next is explained supra-national European standards organization (ESO) level which is and a level above sub-national level of Danish Industry Standard (DIS). The diagonal policy integration is between different departments, where the horizontal is the organizational policy integration in a company. This is done because as stated in the article by [Reinhard Steurer]: which states that; “Complex global policy problems such as climate change or biodiversity degradation transcend not only the competencies of ministries within a particular government, but also the vertical tiers of different jurisdictions, from supra-national institutions like the European Commission via. National and provincial governments, to city halls.” (ESDN, 2009) Hence the supra-national European standards organization (ESO) is elaborated in the next section.

European Standardization Organizations The objective of European standardization Organizations is to agree on common specifications and/or procedures that respond to the needs of business and meet consumer expectations. Standards are part of the knowledge economy that underpins European industry and society. They facilitate innovation and promote the adoption of new technologies, according to ESO’s website themselves.

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ESO states on their website that they are a key instrument for the consolidation of the Single Market and for strengthening the competitiveness of European companies, thereby creating the conditions for economic growth. European Standards are seen as a valuable tool for facilitating cross-border trade – both within Europe’s single market and with the rest of the world. They reduce unnecessary costs for both suppliers and purchasers of products and services – both in the public and private sectors according to ESO. Standards can be used to improve safety and performance, raise levels of energy efficiency, and protect consumers, workers and the environment. They complement European and national policies in these areas, and make it easier for companies and other actors to respect relevant legislation. - (ESOa, 2015)

Three ESO’s European Standardization Organizations consist of the following committees and institutes: •The European Committee for Standardization (CEN) •The European Committee for Electro technical Standardization (CENELEC) •The European Telecommunications Standards Institute (ETSI) They are all officially recognized as competent in the area of voluntary technical standardization. The European Union (EU) Regulation (1025/2012) which settles the legal framework for standardization, has been adopted by the European Parliament and by the Council of the EU, and entered into force on 1 January 2013. - (ESOb, 2015) Cooperation of the European Standardization Organizations: Joint Presidents' Group The three European Standardization Organizations cooperate on policy and technical matters of common interest. This cooperation is coordinated by the Joint Presidents’ Group (JPG). As its name implies, JPG comprises the Presidents and Vice-Presidents of CEN and CENELEC and their ETSI equivalents (General Assembly Chair and Vice-Chairs, and ETSI Board Chair), together with the Director General of CEN and CENELEC and the Director General of ETSI. - (ESOb, 2015)

Activities The JPG enables discussion of matters of common interest to the three European Standardization Organizations (ESOs). As the highest policy-making body in European standardization, it takes due account of political and economic developments likely to affect standards-making. It agrees a common approach to technical issues of interest to all three bodies, and towards standards organizations in other regions of the world, by arranging collaboration meetings and concluding formal agreements (as appropriate). - (ESOb, 2015)

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Appendix E) Integrated Product Development with Product/Service Systems Approach The following figure III shows the new way of thinking business, the product/service system approach. In this model, business is also made after the traditional point-of-sales, and goes further into the products life cycle to use and disposal.

Figure III Traditional manufacturing approach, where the value creation process ends with the sale of the product and a PSS approach, where the value creation process continues throughout the product’s life cycle “PSS approaches create a dependency between a (providing) company’s operations and a (receiving) customer’s activities. There is a close integration of operations, both tactically and strategically.” (Andreasen et al., 2006) PSS development models must secure the integration across the different levels of the company’s development activities, such as: (Andreasen et al., 2006)  “Strategic business/product planning in cooperation with networks and service partners, i.e. development of PSS concepts.”  “Product management and product development projects leading to new PSS ‘offers’, i.e. development of the product/service offer.”  “PSS delivery system or function, which in steady relation to the customer delivers services, i.e. offer customization and development of the service channel.” The figure IV, explains the company’s relation to the customer in the PSS approach. Here the company own or rents out a product /service and the customers is supported by the company in order for the product to be recovered or service terminated at end-of-life or use.

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Figure IV: Two life cycle systems to be considered in the development of PSS Approach There are basically two life cycles; Product life cycle and Customer Relationship life cycle; that should be considered in the development process of a Process/Service based systems (PSS) approach. Fundamentally, the difference in PSS in relation to traditional product development is that: (Andreasen et al., 2006)  “The physical product is supported and enhanced throughout the customer’s activities by the providing company (the business relationship with the customer may spread over several product upgrades and generations).”  “The value creation is in the resulting activity where the physical product, supporting services and the customer all play a vital role (the perception of value is beyond the physical product itself).”  “The customer’s activities are part of the value creation process and the providing company must interact closely with the customer throughout the products life phases.” (Andreasen et al., 2006) The following challenges are identified for IPD integration in relation to PSS approaches:  “The focus on activities instead of products as the mediator of value – the development and providing activities within a company should be aligned with their customers’ activities.”  “The characteristics of services involve the customer in the co-creation of value – the role of marketing, production and design in manufacturing firms should be prepared for increased userorientation activities during the development process.”

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 

“The expansion of competencies required to offer and deliver PSS solutions – how should the partnerships with external companies be integrated.” “The integration of products and services – the development of the total range of products and services that are offered should be coordinated.” (Andreasen et al., 2006)

This discussion is not so much on the distinction between product and/or service here, but on the four factors of defining new activities, new roles and responsibilities, new knowledge and competencies and new relationships. The first factor with new activities is about expanding the activities in time to the products use-phase to ensure continuous development aligning with the customer’s activities in the use-phase. The second is about creating “solution-oriented partnerships” which gives good insights into companies’ ways of orchestrating PSS offerings and the ways to manage these successfully. Thirdly value generation from new knowledge and competencies with customers is created not only in the use-phase, but also in the interaction with customers in regards to their insights and understandings of the value of the product – leading to a competitive advantage if captured and integrated in the company’s organization. Finally the fourth factor of new relationships is about uncovering new relationships and networks in which to collaborate in, as the PSS markets are not as stable as traditional product manufacturing industries, the need to follow rapidly emerging opportunities, is a prerequisite for success. Hence, the innovation in the new relationships and networks will largely depend on the bottom-up approach based on in depth knowledge of customers and their context.

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Appendix F) Measurement for extracting components in the end-of-life products The next section describes the theory and method along with subsequent standard that could be used to implement the extraction methods and measurement for the material efficiency request. [Mathieux et al.] has defined some common aspects for such a standard measurement method and these can be seen in table I.

Table I. Summary of aspects to be defined in the standard (In) (Mathieux et al., 2014) The Table I shows the different set of objectives that should be included in such a standard (In) and the ones related the WEEE (Waste of Electronic and Electrical Equipment) directive, and not Eco directive. In regards to these, as stated by the Eco-Design Article 15: “no excessive administrative burden shall be imposed on manufacturers” as well for this standardization. Hence in [Fabrice et Al.] they state that a definition for “reasonable practices concerning the size of the sample of products to be analyzed” is a necessity. Also the tolerance level for such measurements of sample sized need to be clearly defined as is mentioned in the scientific article too. As for any other measurement standard, it is important that it live up to the following challenges: (Mathieux et al., 2014)  “Sets a well-defined scientific experiment;”  “Establishes a repeatable measurement method so that results are similar when the experiment is applied to analogous products;”  “Addresses the issue of precision of the measurement. “ The commission states that; “To address these challenges, we suggest that the foreseen standard states clear definition of terms, defines the needed operating conditions including: the measurement area, safety requirements, and available tools for extraction (relating when possible to available ISO standards).” (Mathieux et al., 2014)

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Although it is impossible to define the exact extraction process standard of all products, a standard template should be defined according to [Mathieux et. Al.] “to facilitate the exchange of information between manufacturing and third parties (e.g. market authorities, certification bodies, etc.)” to have this standard implemented and applied. Hence also the IEC is to establish a standard method “to define product information for use by recyclers or treatment facilities. “ (Mathieux et al., 2014) An example of such a template “mock-up” has been included. As with any manufacturing sequence, there will always be some slack time, so this is meant as a guideline for the possibility to extract the resources from the product at end-of-life (EoL). The operators experience level and other variables will have to be considered, such as ease of disassemble. Other such aspects to be further investigated other than Design for Disassembly could be other resource efficiency strategies, including for example Design for Repair, Design for Upgradability, Design for Re-use and Design for Durability also. (Mathieux et al., 2014) Following shows an example of a table of how a manufacturing extraction process could look like:

Table II. Example of an extraction sequence to be communicated by manufacturers (Mathieux et al., 2014)

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Appendix G) History of Danfoss Danfoss was founded by Mads Clausen, born 21. October 1905, in his parent’s farm-house in Nordborg on the small peninsula of Als in Southern Denmark on the 1. September 1933, when he was 27 years old. He had previously, at age 23 graduated from Odense Technical College in 1927, after an internship at a machine works in Sønderborg. (Danfoss b, 2016) He started by crafting and patenting the pioneering product of the company Danfoss; the expansion valve (depicted below in figure V) and the first successful valve was made on 25. November 1932. During the first start-up year of 1933 they sold 466 valves and the year after sales quadrupled. In the 1940s Danfoss moved on to also produce household’s thermostats, which they today also are renowned for around the world. (Danfoss a, 2016)

Figure V: The Pioneering Product at Danfoss in 1933 – The Expansion Valve (Danfoss a, 2016) Today, Danfoss has 24.000 employees worldwide and close to 50 different product lines and invests around 4% of its net sales worth in new and innovative products capable of saving the world large amounts of energy and CO2 – e.g. in food refrigeration, air conditioning, heating buildings, regulating the speed of electric motors, and in powering mobile machinery (Danfoss a, 2016). Danfoss was certified with the quality management system for product ISO 9001 in 1990 for its 63 Danish factories, and its environmental policy (their corporate standard from 2002) was revised and published according to UN global compact initiatives 10 principles based on four themes, human rights, labour, environmental sustainability and anti-corruption in 2002 (See App. B page 54 for details), along with the first sustainability report published on their website from 2003. Danfoss’ Climate Strategy states that: “by 2030, Danfoss will be using half as much energy as in 2007 and this energy will emit half as much CO2”, which is very broad in terms and specific requirements.

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Appendix H) Description of a frequency converter A VLT (variable speed drive or variable frequency drive), is somewhat like a smaller computer, is consists of conductors, transistors, resistors, cooling fans, heat sinks etc. and power input plus the power output to the motor it is controlling. Along with these capacitors to control the circuit with the final printed circuit board (PCB) to connect and control these elements. In figure VI, all the elements of a variable speed drives are shown, from a variable frequency drive (same typology) from circa 1980’s. The drives today’s consists similar parts, but advancements in technology has made the energy efficiency of these Drives higher, along with smart software. Over time they have also gotten smaller due to new technology and always

minimizing the space of electronics. Figure VI: How a variable frequency drive (VLT) looks like from the inside (VFD, 2016)

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Appendix I) Effects of the Directive on EuP so far Results from the pump industry; Grundfos, where the potential of shifting to more energy efficiency motors was looked into in part 3.2. As VSD in the figure 3.6 was a part of the extended product approach the savings for this energy efficiency aspect is elaborated here. This is described in order to explain the results of Danfoss Drives been focusing vastly on the energy efficiency aspect and not considered the material efficiency aspects not being a requirement yet. The outcome of this has been, that once fully implemented energy efficiency for Grundfos states, “the regulation is expected to increase the market penetration of technologies that improve the environmental impact of electric motors, leading to estimated life-cycle energy savings of 5500 PJ(Petra Joule) and electricity savings of 135 TWh by 2020. This compares to the situation if no measures had been taken. This amounts to an annual reduction of 63 million tonnes of CO₂ emissions” (Sckerl, 2010). The energy savings of 135 TWh is equivalent to the entire yearly consumption in Germany and accumulated electricity savings is expected to reach 657 TWh by 2020; as stated in the workshop. Motors have a long life-cycle of around 12-20 years. This means that the expected energy savings from the stock of product will take longer to materialize, but that they are also likely to continue and even increase after 2020 since more efficient products will be sold after the requirements are introduced, these products will still be in use well beyond 2020. “In June 2011 IE1 motors were phased out. Given a market share of 78 % in 2010 and that the switch to more efficient motors has been happening slowly this is very ambitious. Clearly, the introduction of the IE2 requirement would be expected to lead to substantial changes that would not have taken place otherwise.”(Oxford Research, 2012) In 2010 approximately 110 million electrical motors existed in Europe and the number is expected to reach 127 million by 2020, as Grundfos states. (Sckerl, 2010) Voluntary agreements (like CEMEP) between the industry and the EU were implemented prior to the development of the Eco-design Directive and they have pushed manufacturers towards marketing relatively more efficient motors. A change in the market towards more efficient alternatives is currently taking place and it seems unlikely that the IE1 motors which dominated the market in 2007 would have been phased out, without the push of Eco-design requirements. Thus, the requirements have had a significant direct effect on the market. (Oxford Research, 2012) Still, statements from the report on Eco-design Evaluation, say it is doubtful whether the set targets will be met. At the same time though, the requirements seem to be rather unambitious in comparison to those in the US and Canada, where IE3 requirements were introduced in 2010 and where these motors already have a significant market share (39% in Canada in 2007). (Oxford Research, 2012)

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Appendix J) Semi-Structured Interviews Description and/or aim of interview: “More or less open-ended questions are brought to the interview situation in the form of an interview guide” (Flick, 1998 p. 94). From the beginning the focus is on gaining an understanding based on textual information obtained. The level of depth of understanding that the researcher pursues is used to characterize this type of interview. Nature of questioning route: flexible, but usually a given set of questions is covered, varying levels of standardization Type of question format/structure: Open-ended, yet directed at obtaining particular information (content, topic, aspects of theory, etc.) In some cases, closed-ended style of questions are used Role of probing: Get the participant to expand upon their answer, give more details, and add additional perspectives

Aims of the Analysis: The method starts with the assumption that flexibility is needed in order that participants’ are not restricted by standardized questions and closed-ended structured answering formats. Qualitative analysis can be focused on coding text to identify ranges of responses often categorized according to themes, named code categories. It also can focus on describing events, situations, people or providing information sought from asking a particular question. Normally, the goal is not to aggregate data across respondents, but rather explores things like similarities and differences of ranges across voices. Standard practices of content analysis maybe employed as well as more qualitative approaches to data analysis such as open and axial coding.

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Appendix K) Semi-Structured Interview Guide - Template

Questionnaire Template for Danfoss  General Profile Questions 1 .What is your role at Danfoss & Responsibility area? How many years have you been in this position? a) Your own personal experiences with Danfoss’ environmental policy?

2. What are your thoughts about using Eco-design in your part of the organization as a means to incorporate environmental measures in the product development activities?

3. Have you heard about the environmental management system ISO 14001?  (Rate yourself from 1.poor, 2. bad, 3. mediocre, 4. good, 5. excellent understanding) a) Do you use it in your organization? b) Do you use the life cycle aspect incorporated in ISO for ecodesign in product development? AND; c) Do you measure your performance for it?  How? o Can I see examples after this interview?

Your specific organization 4. What is the key role of your organization within the group at Danfoss Drives? a) Does your organization have any specific environmental goals in your strategy? b) Does your organization have any specific goals for environmental material efficiency?

5. What do you see as the important environmental demands from customers or other stakeholders within your part of the organization at Danfoss?

6. How does your product development process look at the moment (stage/phase model?) c) Can I see examples after the interview 7. In terms of Eco-Design and Integrated Management Systems? (ISO 14062) a) Do you & you’re organization use Eco-Design to make decisions to support the management system processes? b) What goals do you intend the integrated management system should fulfill?

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c) In what degree does the current management system (ISO 14001) meet your requirements to make an optimal decision in regards to product development accounting for sustainability aspects? d) Do you assess economic, social or environmental data currently for your different options within product development when looking at Eco-design and optimizing material efficiency aspects in the product’s life cycle?

(Rate) 1. None

2. Few

3.Medium

4.Some

5. A lot

In Economic terms: In Environmental terms: In Social terms:

Eight Deliverables - material efficiency options prioritization Materials

8. Assessment of importance: (Rate: 1-8 which has the main focus in your organization as of now) 1 2 3 4 5 6 7 8 -re-use of products: - re-manufacture of products: -recyclability of components: -recoverability of components:

Use

-durability of products: -upgradability of products: -ability to repair products: -accessibility of components extraction:

Disposal

9. Specific questions regarding the material efficiency deliverables: I. II.

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Ability to evaluate the ease of access or removal of certain components or assemblies from products to facilitate their extraction at the end-of-life for ease of treatment and recycling;? Ability to evaluate the access or removal of certain components, consumables or assemblies from products to facilitate repair or remanufacture or reuse?

III. IV.

Specific Method to assess the proportion of re-used components and/or recycled materials in products;? Documentation and/or marking regarding information relating to material efficiency of the product taking into account the intended audience (consumers, professionals or market surveillance authorities).?

*“Use and recyclability of Critical Raw Materials from the EU, listed by the European Commission” Materials

10. Assessment of importance of theoretical Eco Design Methods: (Rate: 1-8 which has the main focus in your organization as of now) 1 2 3 4 5 6 7 8 - Design for Components: - Reduction of Materials & design for disassembly: - Material discretion: The use of mono-materials: - Recycling and Reuse of the product:

Use

- Systemic Design (Durability of the product): - Technology for sustainability (Upgradable): - Service Design (Repairability): - Size reduction (% volume of the product):

Disposa l

 Strategy in the organization 11. To what extent do you know the environmental policy and strategy of Danfoss(strategy & goals) a) Group: Are there elements in the environmental policy you think should be strengthened (show examples if yes)? b) Local Department: Are there aspects that should have more attention in your department? (show examples if yes)? 12. To what degree do you expect that collaboration between you and your customers/ or suppliers will have a bigger focus on material efficiency within the next 2-3 years? 1. No collaboration, 2.less coll 3. Same as today, 4.More, 5. Vital for collaboration

Structure in the organization 13. Where is the responsibility placed for overseeing the monitoring of the material efficiency goals for your organization? 14. How are you currently monitoring the performance for these material efficiency goals? 15. What do you think should be monitored to achieve these material efficiency goals?

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Life Cycle Perspective for ISO 14001 and product development 16. Where do you and your organization have the most influence on the product life cycle stages? 17. How would you prioritize the five life cycles phases? Within; (Rate 1-5) give out one grade to each phase in the life cycle. Life Cycle 1. Non-critical 2.Less critical 3. Medium 4. Somewhat 5. Very Critical Stages critical 1. Raw Materials 2.Production 3. Transport 4. Use 5. Disposal

18. List after importance for implementing material efficiency, the following 4 stakeholders (stakeholder analysis) Give out 10 points (from 0-10, and split these up on the four stakeholders a. customers

b. employees

c. society

d. authorities

19. Your opinion on the material efficiency perspective within product development and EcoDesign?

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Appendix L) Interview Transcriptions of Employees at Danfoss Drives A/S (AS-IS profiling) •Profile Questions:

Lone Harvest Product Manager at Danfoss Drives A/S – 19/4-2016

What is your role at Danfoss & Responsibility area? How long have you been in your current position?

I am a project manager here at Danfoss Drives, and I am in charge of a lot of projects, here in question also product development projects. with new product development optimization, so I know the product development model, and what we do and don’t do today. I have been in my current position at Danfoss 6 years.

Your own personal experiences with Danfoss’ environmental policy?

Right now I am working with a compliance project on the RoHs Directive, so I would say relatively good as I am working within Danfoss environmental policy in general and how we live up to the statements (which I cannot remember now) for example environmental hazardous materials, CRAN (Volatile substances) Reach and the green passports etc.

What environmental concerns does your part of the organization work with?

In general; We focus on in connection with new product development projects that we live up to current environmental demands that Danfoss has, and when we do Q-release (quality release) we have some environmental assessment within the Reach and RoHs directives that we live up to. So it is a part of the deliverables and milestones, which already starts at product specifications, what is environmental demands; here in question waste materials, not so much in the energy savings aspect, but the materials aspects, non-toxic material (no carcinogens) etc.

How do you incorporate environmental concerns into product development?

We have the environment assessment; which is a basically check list where we assess the environmental hazardous substances, and it is a must-have from the quality function, which signs these, but a little unsure about this. It however has to be run though and you cannot progress in the product development milestones or Q-release, before this is handled, so in this way it is indirectly a part of the product development process. ( The first environmental assessment is a part of mile stone M1(Initial assessment) (See product development process figure) and final assessment before M5 – Qrelease) The product process figure looks the same as 3 years ago in 2012. The first thought about this is in the design phase moving up the 5 stages.

•Your specific organization What is the key role of your organization within the group at Danfoss Drives? A) Does your organization have any specific goals for environmental material efficiency?

What customer demands and demands from other

I will have to leave you hanging there, as I am not quite sure, but we have a disposal agreement; I have not had a project which has progressed to this final stage in product development thought. But what I know is that we define spare parts, to see if we throw away parts of the product or the entirety of it. (Spare parts strategy). We e.g. have some smaller drives, that are spare parts, or we replace fans or print boards also to some products to prolong their life. It is called Disposal Declaration, which lies before the final Q-release; including spare parts and materials, it is one of the deliverables, as a part of it. I have not used it however, and it is updated each year.

I have not seen this, they usually ask about energy efficiency of our products,

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stakeholders are there to product development according to you?

and how we are performing here primarily. In the startup phase of product development, we held a big work shop with product managers all around the world, to see what customers could want, for example that the drives be as small as possible, that is a environmental concern also. We also look at transport strategy; produce where the customers are located, and if we have to transport something; we look at time and costs and that we don’t want to fly everything home/abroad.

Who participates in these workshops beside managers?

It is the project leader, the supply chain managers, research and development and product management. There we make a list of all the demands we have (god know’s what) both size, function, net flows = all the demands and requirements from customers, how important is it (nice to have or need to have). Then we prioritize these and at the workshop exclude some and include some and then we know which subject we are insecure about, to go to the customers and ask them finally. So it is all parts who are involved in this process, but primary driven by what the customers wants.

How do you then ask the customers about what is nice-tohave and need-to-have? (QFD model)

It is kind of another angle (but also kind of House of quality) but different processes designed by Danfoss, all from puzzles with different sizes pieces compared to costs, functionality and then choose between the relative cost size and functionality for a display e.g. We have different methods for this, but our product management team are champions at this type of scenario planning. I have never participated in this however.

List after importance for implementing material efficiency, the following 4 stakeholders (stakeholder analysis) a. customers b. employees c. society d. authorities

We are customer driven, but at the same time have the overall environmental policy for sustainability, and some environmental demands (EMC) we at Danfoss have some stricter demands also. From the initial aspect customer driven as it gives you the profit on the financial bottom line. If I can put Danfoss as the society, than we go a step beyond what is required by law, because we want to be environmental friendly by society. If we live up to the demands Danfoss have, then we by default also live up to authority’s laws.

•Product Development How does your current product development process look like at Danfoss (stage gate model)?

(Answered already, looks the same today as in 2012) see figure .

A) Where in the process are environmental demands appearing?

Initial environmental assessment in M1 and final in M5 in the figure.

B) Does environmental demands appear other places than product requirements specification (f.ex. EPD, environmental product declaration)?

Environmental Product Declarations; Pass I don’t know, I have heard about green passports though. (shown an example template of this) We do this, because green passports; is about how much the product weighs in grams and how much is recoverable and recyclable etc. I know that some customers ask about these (we call it green passports here however) I worked together with one co-worker in the environmental product declaration group, I think she looked at these rates for products, but will have to ask her. Preben knows these, and if he says we need these, then I will know about it too in the Disposal declaration. There is a link between these two.

In terms of EcoDesign and Integrated Management Systems with use of 8 material efficiency aspects mentioned? (ISO 14062); a) Do you know the 8 methods

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I don’t think so…

Materials

Use Disposal

from the EU standardization request on material efficiency?

(Mentions the 8 methods and their functions)

b) How does your part of the organization work with these 8 eco design methods in product development currently? (Rate: 1-8 which has the main focus in your organization as of now)

Ability to repair is a part of the spare parts strategy. Recycling of products; we also do this, as we think in modules and customers can buy the drives and set different options (add-on) modules for products later on. The modular product architecture is also a part of the work shop with customers, how should it/or not be modularized; setting an add-on but cannot replace something else; the customers has to purchase the right product, and what is should do from the beginning, this is recycling to me. In re-use of product/components, the more of a modular product architecture we have the faster we are at releasing products to the market.

-re-use of products: - re-manufacture of products -recyclability of components -recoverability of components -durability of products -upgradability of products -ability to repair products -accessibility of components extraction c) In what degree are these 8 methods integrated into the current management system (ISO 14001) in regards to making an optimal decision in the product development process?

d) Do you assess economic, social or environmental data currently for your different options within product development material efficiency aspects in the product’s life cycle?

We often buy pre-processed components, but we do not take our products back and sell these. With components we don’t have the options to take defect components back either. In regards to reliability and warranty period for 2 years, we focus a lot on the durability and reliability of the products as a competitive advantage The add-on option (profibus) communication remote controlling, to be installed on the already owned drives (piece of hardware) is part of this. We do not take back and repair products, but look at what should be spare parts reparability, in the design phase. The disposal agreement I would assume would be part of the accessibility for components extraction as a deliverable in the product development process, but not quite sure.

The economics aspects we always look at, and if we are talking about only these three aspects, in product developments projects; the environmental aspects lies higher, with social aspects less. Yet again the environmental aspects, is part of the culture at Danfoss, as seen by management. We don’t do business cases on environmentally sound products, but economic costs and benefits as these are more measureable than the other two parameters. Everyone knows however that we as a company do not get to the point where we harm the environment. (risk avoidance) We look also at products containing harmful substances and look at substitution options to get rid of these (as part of the Reach directive)

TO-BE(Assessments) • 8 Demands on material efficiency Specific questions regarding the material efficiency deliverables: a) Ability to evaluate the ease of access or removal of certain components or assemblies from products to facilitate their extraction at the end-of-life for ease of treatment and recycling? B) Ability to evaluate the access or removal of certain components, consumables or assemblies from products to facilitate repair or

Not according to recycling or recovering of components and products: but in regards to spare parts, very early in the process we look the spare parts strategy and talk to end-users (Not just customers, since also some are business-to-business) and service technicians; how do they see the spare parts as an option; it is better to look at what we think is smart through their eyes also (user interaction). Design and how it is actually used by the customer (usage options) needs to be consolidated.

Repair is seen here as same as the spare parts strategy, but remanufacture is not something we here at Danfoss delve into so far. /The three X’s placed within a less focus (1)

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remanufacture or reuse? C) Specific Method to assess the proportion of re-used components and/or recycled materials in products?

This I don’t know, as I do not have the knowledge of the disposal agreement/declaration mentioned before. (Would like to see the disposal declaration document for project)

D)Documentation and/or marking regarding information relating to material efficiency of the product taking into account the intended audience (consumers, professionals or market surveillance authorities).?

We have the compliance, legal aspects, (the trash can symbol) and labeling aspects, I have not seen it though. RoHs is a part of CE marking and REACH and green passport (not a part of the CE labeling) We also have a 2 page excel sheet called the Danfoss negative list; which is a list containing all the substances and materials that cannot be a part of Danfoss production (suppliers and sub suppliers). And as a corporation we are very environmental conscious, but I have not seen the EU flower on our products for OEM customers and end-users.

To what degree do you expect that collaboration between you and your customers/ or suppliers will have a bigger focus on material efficiency within the next 2-3 years?

Certainly, We can feel this already, in the line with RoHs a few years ago, and customers demand this now also, in terms of materials we put into the products, but also how effective and energy efficient our drives are.

Assessment of eco design methods (not including EcoAdvertising): (Rate: 1-8 main focus at the moment.)

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1.Design for Components: The strength of parts

Recyclability; we look at materials; like a print board, and if we throw it out we do not recycle these.

2.Reduction of Materials and design for disassembly: The sustainable lightness of materials

We look at materials reduction, as the less materials used, the more we can save, less materials, less transport etc. We do not look at design for disassembly.

3.Material discretion: The use of mono-materials and bio-based materials

We look at what type of material can live up to the requirements and attributes for the product in question, but we mostly have aluminum and plastics. Procurement looks more at buying in bulk (buying bigger sources of one type of materials=cheaper costs)

4.Recycling and Reuse: Multiuse of materials

No we do not look at multi-use of materials.

5. Systemic Design: Zero Emission systems

We look mostly at durability, reliably and quality of the products, and compatibility with other products within a system.

6.Technology for sustainability: Techno/Ecologically sound products

We look with the profibus (add-on) software and hardware for drives

7. Service Design: 0% emitting products

We look a lot on the reparability aspect, as a service by Danfoss.

8. Size reduction: Decreasing the volume of the product

We have other reasons, because customers want smaller drives; as it is easier

to handle, and there is less packaging materials, which both environment and economy gains from (saves money and resources) REFLECTIONS •Life Cycle Perspective for ISO 14001 and product development Where do you and your organization have the most influence on the product life cycle stages? 1. Materials and design 2. Production 3. Transport 4. Use and lifetime 5. Disposal and treatment

In my role as project manager; Water consumption, electricity, components and design for these: Materials as product developer; we look at what materials usage we have, and what is put into production as the two main focuses. The use phase is the spare parts and repair, which is prioritized a step beyond transport with disposal coming in last.

Have you heard about the environmental management system ISO 14001? (Rate yourself from 1.poor, 2. bad, 3. mediocre, 4. good, 5. excellent understanding)

Yes I have heard about it, but specifically in my work I have a poor understanding of the management standard, as holistic approach. Everything in the standard is then later “boiled down” to the operational level where I use it in the Ghantt chart and deliverables for the product management function.

A) Do you use it in your organization?

No, because it is the way we do it operationally, not to avoid responsibility, but management have described the way to handle the process within ISO 14001, and then it is over rationalized for me, to be able for me to do my work. So day to day I do not use its line of thought.

B) Do you use the life cycle aspect incorporated in ISO for eco design in product development? and;

Take this with caution; as I am not in charge of the disposal agreement(declaration) but in terms of the initial and final environmental assessment checklists then; yes in somewhat degree, as it is naturally a part of product development process (though not a super-user in this).

C) Do you measure your performance on the five life cycle stages/phases?

Not necessarily, as I am not the process owner of these KPI’s, but there might be.

Your opinion on the material efficiency perspective within product development and EcoDesign?

I think it is something we need to focus on, which I think we do, as there also is more and more from EU’s side appearing. I think we need to be sharp and good at handling these. Also in regards to our children and future generations. CSR (corporate social responsibility) seen as a competitive advantage as well, we need to be ahead of these, in terms of materials, and energy efficient products with how we treat the environment within production aspects as well I think it is interesting as we can see the direct impact, and that we need to be a part of solving these issues.

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(AS-IS profiling) •Profile Questions: What is your role at Danfoss & Responsibility area? How long have you been in your current position?

I am leader for the PEC (Product Engineering Center) and I have the mechanical part; all components and the architecture of the drives not including the print board. Some of the electrical components is also my responsibility for example fans, electrical wires and sockets and other constructions, here under the mechanics. I have a group of 12 engineers, the structure is that we develop a product in a development department, then when it starts production and hence maintenance where I take over, this is seen as a good way of handling it since we are not predisposed to anything, so we can make the product cheaper and of a better quality. The products I have is ranging from 0,75 to 90 KW which is produced here in Graasten and Tørsbøl factories, and I have two personal in Danfoss solar inverters in Nordborg. I have been in my current position 6 years as leader of the department, but have worked at Danfoss for 30 years.

Where you and your department are placed organizational wise for Danfoss Drives?

Since it is maintenance of the products the responsibility for the products and maintenance is in the Supply Chan management, for better and worse, since then you have the competences of the production; how good, cheap and fast and we produce the products, and not so much how technologically advanced the products are; what they can perform; it gives some advantages for better and worse.

Your own personal experiences with Danfoss’ environmental policy?

I have only good experiences, as we have previously had some good departments and divisions which have updated such standards, but through time it has been cut to the bone, as we more rely on the international standards instead of making our own. I think we have had a sound foundation to build upon, and don’t think we are behind the competition and most other companies.

What environmental concerns does your part of the organization work with?

We have each time we do design the focus of not smelting to much of the components or materials together, we try to make the design for disassembly as the first step, following that is the negative list at Danfoss for reference to the design of product and components our suppliers have to live up to in the sense they do not use any of the materials on the list. Sometimes we have somewhat quote specious demand specifications we have to live up to, which can become somewhat confusing to figure out, we have specialists in each area for these.

Within the standards as well?

Not any specifically that I know of.

Does your organization have any specific goals for environmental material efficiency?

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Helge Nielsen – Maintenance Manager at Danfoss Drives A/S 19/4-2016

Not really, we do not have these. We however know that aluminum as a metal is very energy intensive to use, but when looking at design both quality and costs are the main drivers for how we choose the technology, so even though a tin plate is relatively easy smelted than we would have to look at more parameters to choose this option over aluminum.

•Maintenance How is the maintenance function of products strictly organizational speaking setup?

What service does Danfoss provide on the maintenance function (take-back etc?)

How are you involved in the maintenance of products/ components?

There are 8 methods as part of material efficient product solutions today ;

If we mention the market flaws of a certain end-product, then we usually define how we can save this product with a brain-storm in the short term (containment action), and then we have the corrective actions which is in the long terms and finally preventive actions which is how we can avoid this type of flaws on other products so as not to happen again. It is a progress process which we run through each individual quality issues case. The prioritization depends on how big a flaw we are taken about in the market, and how big the customer is, but in general we a prioritization based on what type of flaw it is, we actually have 10 categories, if it is a human safety violation flaw then it is a number 1 priority, everything is focused on this then, and then the categories goes does the list, economic also rated high. A containments action is in the top 1-5 categories, and if it is quite severe we also take-bake the products from the market, and to prevent the seize of production, as this costs A LOT of money, we then do these containments actions, which puts a pressure on us, since the entire organization is waiting on us.

We have where people and customers can have products sent back and repaired and thus upgraded to the newest edition and then sent to them again, This we have done primarily one the solar products as they are designed to run 10 years for this product group, so we for 10 years actually have to repair the small issues and return them to customers. The reasons for this is that we have made a economic calculation looking at take-back-services of the service technician compared to the relatively high expenses of having the “small factory” running taking back products and making them run through the upgrade system instead. It functions the way that the customer does not get the same product back, but an even better and optimized product (typically newer product type).

We have had some cases where we have taken some product back and repaired the components, but this is not a normal occurrence. It is not very often but quite rare, only when we can see our design is flawed, else it doesn’t pay to do this.

I have not direct knowledge of these methods, so not an expert. (Mentions the 8 methods and evaluation)

By the way, you mentioned before in maintenance; we have a lot of spare parts for our products, where customers themselves can buy the spare parts (outside the warranty period) and repair the products, we have quite a bit of this going on today. We have big inventories on these; all from inductors to print cards, and this is specifically on the more expensive products, since the large 90 Kw drives are built for easy reparability, more economic initiative for these than the smaller “buy and throw away products” of 0,75 Kw products

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• 8 Demands on material efficiency How are these a part of the daily work at Danfoss today? Assessment of importance: (Rate: 1-8 which has the main focus in your organization as of now)

Materials

Use Disposal

-re-use of products - re-manufacture of products -recyclability of components -recoverability of components -durability of products -upgradability of products -ability to repair products -accessibility of components extraction

TO-BE (Future) A) How will they be implemented?

Many of the points just mentioned, we would have to make some work on how to make this a reality, primarily our development function which would work towards having these implemented in new products, and as is has become a demand, we would then inherit the maintenance of said products and the options they are design for. Today we have some demands, and each time we have to change a small part of the component in the product, we need to live up to the new standard, if this becomes law we need to look at this. We have a continuous dialogue with Preben Holm (Standardization Specialist also interviewed) who informs us of what might happen and become a standard, so he would inform of these requirements and that we are moving towards these before it becomes an actual standard.

B) How well prepared are you to implement today?

I am not frightened about any of these, these we could easily implement, I Think.

C) How will it be done?(through what streams) D) Who exactly will be involved in the Implementation process?

We are many already who take part in this, so it would be procurement, production, and the development function along with the approval and reliability function here in question as there are many in this broad chain of command.

Where would you like to move towards regarding material efficiency and the maintenance function? (moving from energy/material focus towards systems optimization focus)

Our focus is that we want to ensure our customers having a lesser energy consumption and this is by using the products, not so much how the product is built (materials) and this is correct that it yields a much larger efficiency factor and economic rewards, if we can make products that have a long durability and high efficiency rather than just materials savings, then we gain something for the environment in the long term as our products always are part of a system. Our products are never a stand-alone product, looking at a simple On/Off motor then most of these can be energy optimized by using one of our VLT drives where the rotation is adjusted, and hence in regards to cooling, motion, compressors, pumps HVAC and others these can be optimized system-wise. So we are not done looking at energy efficiency yet.

TO-BE(Assessments)

Assessment of eco design

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In Solar Inverters we have some, but on materials aspect we keep these “clean” so to speak of, so aluminum heat syncs could easily be re-purposed and smelted and recycled. Many parts and plastics are labeled as well, so you can see what type of plastics it is so it can be recycled and reused. In re-manufacture; we smelt the products, and re-use it is taken apart and reused. In components if we take solar inverters, we have some of these in place, in the recoverability only in component extraction then we do not does this for other purposes. We design the products for at least 10 years minimum max 15 years, but the warranty rate is only 1,5 year so here relatively high. In upgrade wise it is mainly software add-ons; we upgrade for example if there are new laws specs we do this, but it is not only software(speaks for itself) but components as well, if we know a components is more effective in a newer edition then we can replace these. Reparability is again dependant on if bigger or smaller products, but we mostly sell bigger (90 Kw) products so we are doing quite well here also. In accessibility of component terms most are very accessible, but an inductor for example, if a third party need to re-use this needs to know what it is specified to run for, and in these terms not accessible since there lies some company secrets to these inductors, so we do now re-sell them for our business aspects.

methods (not including EcoAdvertising): (Rate: 1-8 main focus at the moment.) 1.Design for Components: The strength of parts 2.Reduction of Materials and design for disassembly: The sustainable lightness of materials 3.Material discretion: The use of mono-materials and bio-based materials 4.Recycling and Reuse: Multiuse of materials

5. Systemic Design: Zero Emission systems

6.Technology for sustainability: Techno/Ecologically sound products

7. Service Design: 0% emitting products

8. Size reduction: Decreasing the volume of the product

•Structure in the organization Where is the responsibility placed for overseeing the monitoring of the material efficiency goals for your organization? How are you currently monitoring the performance for these material efficiency goals?

This is more on the compatibility aspects, as our product is built in modules, meaning you can buy some options (add-ons), which means in the design we ensure that the older options are back-ward compatible with new products, so if this is meant then we do it. If we are looking at metal plates we don’t design these to be reused in an upcoming development project. We do somewhat this, but the new and compatibility is where we focus. The materials reduction is looked a lot upon, that we optimize and use only the necessary materials in regards to weight, costs, and environment (material scarcity for example). We ensure that it can be assembled in an easy manner; we have these processes where (PFMA) production flaw mechanism analysis where we analyze what could go wrong in the assembly process and production. We also have a (DFMA) design flaw mechanism analysis, where we look to not have inexpedient design flaws which could make mistakes later in the processes to ensure that the processes and component are optimized and less material use(and waste). We try to ensure many of the same materials in production, which has many advantages not just recycling or re-smelting but also in procurement aspects by saving moving with buyingin-bulk (large quantities), so also a business aspect here (synergy win/win). In term of recycling and reuse we still lie low here because, when we develop a new product, then we could reuse a lot of the design as well, for example with new car generations they say that there are not the same components (generators) not the same, I think we do a little more here, like reusing display and inductors and contact switches, but could be dealt more with. Systemwise we have a large product portfolio, and also adjust these to the customer’s needs (engineer-to-order), we have some special products, which are design for these ad Danfoss in all surveys lies in the high end of quality and robustness in demands. On the upgradability it is mostly the software perspective we do this, if we find a feature that can be added to some software which in one example could monitor the motor in the system, and give out warnings for this if the motor needs to be replaced, so the motor can be salvaged before the point-of-no-return, this has been a success, but on the component aspects and sustainability we are not so focused on these. We in service design, have these list of spare parts of which high end product can be repaired, but in the factory here in Graasten we produce-to-order and not to stock, so if there is an order of these spare parts we have them produced. We have in focus that the products size fits a EURO pallet and a container specifically to these standards, we do this not to transport to much air, but there is also a safety requirement in regards to the robustness of the packaging materials (plastics polystyrene) might not be the best option to transport, but here we have chosen supplier nearby to lessen the transports environmental impacts. We optimize the transport time, so we always can fill up a container as well.

That would be our quality management department that would be in charge of these, would be my best guess, yes. The KPI’s would also be them handling the monitoring of these. Like for example the TS16946 (Preben Holms mentioned) standard KPI’s that was made. I don’t think we have any KPI’s for these today, what customers wants/needs important etc. We today work based on check lists, which means we have some points in the check lists for example is the material used optimally or are there composite materials to make sure for the designers to be vigilant for these, so we have mandatory these checklist that when we change a design then we have to run through a check list of maybe 150 points which need to be run through and assessed, here in question CRAN (volatile substances and

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carcinogens etc.).

What do you think should be monitored to achieve these material efficiency goals?

REFLECTIONS

I think what could be easier to monitor and measure, would be for example; we know the weight of all materials and components used, and here we could make a database of all these listed, who tells you what your design costs in energy and recyclability terms, (recyclability in mass rate factor etc. for the entire product). This is already in the system, so we need to make the software for this, as we already today have to report the weight of components in the database systems, So I could see this become a reality. You could then say that this product had so-and-so of these parameters, so when designing you would then become aware of these impacts later on to improve recyclability factors and other material efficiency aspects.

•Life Cycle Perspective for ISO 14001 and product development Materials and production Where do you and your organization have the most influence on the product life cycle stages? How would you prioritize the five life cycles phases? Within; (Rate 1-5) give out one grade to each phase in the life cycle. 1. Materials and design 2. Production 3. Transport 4. Use and lifetime 5. Disposal and treatment Have you heard about the environmental management system ISO 14001? (Rate yourself from 1.poor, 2. bad, 3. mediocre, 4. good, 5. excellent understanding) A) Do you use it in your organization?

We are certified in this, and I would rate my knowledge as enough to be able to act on the principles within this environmental management standard (medium knowledge)

Yes, in project planning.

C) Do you measure your performance on the five life cycle stages/phases?

Yes, it is something we incorporate in the design phase, and as we have many old products we sold 20 years ago, we still need to deliver spare parts to these as well, so we think in these terms (spare parts wise). And also tools to repair these, we have some obligation from the announcement of last-time-buy of these old products, and estimate the timeframe (maybe 10 years) and then look into sales numbers of spare parts, and do a forecast of these over time, to produce the stock needed, and then finally close that part of the production. Indirectly as part of our warranty period, we look at the error rate of products, and try to minimize this, meaning that the product should last longer. Callback rates, and customer satisfaction also measured, and customer satisfaction lies extremely high, over our competitors in general.

Your opinion on the material efficiency perspective within product development and EcoDesign?

I think it is a good idea; it is nice to have more focus on because our resources are scare (positive). At the same time it can give a win/win situation that the products can become cheaper, TSO (Total Cost of Ownership) lessened, in the supply chain with a green business model and point of sales being pushed down the value chain a future option maybe.

B) Do you use the life cycle aspect incorporated in ISO for eco design in product development? and;

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We have the most influence on and find the most critical phase to be today (status quo); Materials is a medium, and production is more of a supply chain function, transport is not generally measured today, but we product in the nearby areas, and thereby minimize transport, for example, if we want to sell in china we also produce in china, the use phase is where we design the products to last a long term and run efficiently, and disposal (RoHs) also focus on this

Interviewer; Anders Clausen & Rikke Huulgaard (AS-IS profiling) •Profile Questions: What is your role at Danfoss & Responsibility area? How long have you been in your current position? (Eigil Hansen – Director Global Approvals)

What is your role at Danfoss & Responsibility area? How long have you been in your current position?(Hans Schou Christensen – Consultant)

Your own personal experiences with Danfoss’

Interview conducted 18/4- 2016, Location Danfoss Drives Gråsten Hans Schou Christensen & Eigil Hansen – Global Product Approvals I am Global Approvals Director, for 2 years, and have a department of Global Approvals which lies under the function Regulatory (Part of Group Legal) and it is a department which is in charge of informing the rest of Danfoss of what requirements and directives that are deemed necessary for our products when operating globally. My department has specifically Product Approvals; which means we look a lot on the individual products that need to be market launched in the individual countries, or Europe and Asia, both in regions and stand-alone countries. Here our job is to screen what demands there are regulatory in each country/region and act as a consultancy firm for our four segments at Danfoss (Drives, HVAC, Solar and Heating), we act as consultants giving information to what is regulatory and what demands and requirements need to be met for our products and how to do this. When we then talk about new products and new directives then we should have something concrete to inform as consultants, that this is a directive with these generic product standards, and we need to interpret them this way for the final product specifications. We are first a part of the process when the demands “have been born” and made legal as such, so when directive exists and standards are being developed, we are a part of this process with being a part of more standardization forums both nationally/internationally. Now when talking eco design and the directive along with circular economy, we were then contacted by your contact (Aksel Jepsen) as he has been a forerunner in this area and we have some project where we have had energy labeling on our heating pumps (in Heating segment) so we have not only in Drives, but other places at Danfoss also been affected by this, but here again we need concrete specifications out from the standards, to what the product has to live up to. We know of the political change that look a lot on sustainability and circular economy, we have newly established colleagues in Brussels and want to take active part in leading the way to affect how this change will happen. Therefore Hans (the other interview personal) has been put in charge to follow-up on this, and takes active part in this process, not just seen from Danfoss Drives perspective but the entire corporation of Danfoss so we can help the entire company and this is strictly what we do today. Yet again it is Danfoss’ Policy or our job to secure that we at all times are in compliance with what laws are required. We have therefore said that we will look into this, and it is important to get this new info and be a part of the standardization developments process, so it is not to theoretical what comes out of it, but can be operationsanalised in the final stages. This is our role here. We are a components supplier/deliverer so as seen in the big picture with systems thinking’s, we are only a piece of the entire puzzle to save energy and resources. If you have seen the media we have been programming a lot, so that we by teaming up with others can find optimal solutions and build our products in systems.

Hans Schou Christensen (Global Approvals Consultant): My point of departure is to look at what there is, and what is coming from the EU, but as Eigil stated before we can use the material efficiency aspects, it needs to be formulated in a set of directives by the EU, something more concrete, as I have only seen good intentions and wishes so far, but nothing more than this level. I don’t know about the voluntary agreements, so from our department’s side we have just started to delve into this. I have been in my current position 9 years as consultants at Danfoss. Eigil Hansen(Global Approvals Director): We have our sustainability report and the legal requirements from Danfoss side as reporting functions. Of course we are not those who have the responsibility for being in compliance with these

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environmental policy?

subjects, as mentioned earlier it is the legal aspects of the products we are working with.

What environmental concerns does your part of the organization work with?

Strictly only legal compliance aspects.

How do you incorporate environmental concerns into product development?

--//--

•Your specific organization What is the key role of your organization within the group at Danfoss Drives?

Hans Schou Christensen: Gives out legal compliance and acts as consultancy for the rest of Danfoss to this.

A) Does your organization have any specific goals for environmental material efficiency?

Hans Schou Christensen: No not at this time, this would first come when it becomes a legal binding document. So, no we do not have any of these demands in our current product certifications.

Rikke Dorothea Huulgaard (Supervisor): How do you act when you hear about this new material efficiency standard request, on a corporate level in regards to how to be a part of this, as Preben Holm, is now a part of this at Drives?

Eigil Hansen(Global Approvals Director): Well it functions the way that we in the organizations have Public Affairs (and Industry Affairs) personal and these are the ones mostly taken in as a part of this process and communicating these demands to the organization. I am therefore sitting in some meetings where we get references to what is going on at the moment and there the decisions of who does what is usually taken in this forum. Now it has been decided that Preben Holm (Our standardization Specialist) takes part in these, and as said previously I had a long meeting with Preben last week and asked him about a meeting when more has been discovered, about if we need to “jump in on this” at the current moment or should he be the naturally “food chain” to this info, and give it to corporate later on. We do this from the standpoint to figure out what resources are available to use now, but also that we hopefully can trigger “the right moment” so that we can get concrete info and resources to be a big player in this process as well.

Hans Schou Christensen Ping-Pong Questions Knowledge Exchange

Hans Schou Christensen (Global Approvals Consultant): With the standardization request handling, some of the area we have been working on so far normally with other Directive in CE etc. there it is normally the “other way round”; in the sense that we first have the laws in place and then making generic standards to these. Hans Schou Christensen So I have not myself seen this standardization request, so if you could explain this? It is like if we want to make standards before we make the legal laws that are binding. (Rikke and Anders explain the request to him: It is a standard request making the metrics on how to measure material efficiency in the first place before the law requirements.) Hans Schou Christensen Another question; The standard that should come out of this, should it be harmonized with the law above it or what’s the though process here? as we normally work this way with standards (law first and this is fluffy, and then the standards make it more concrete) (Rikke explains again: This will also be done here, but it is more like the EU wants these metrics before they set these requirement, like with the energy

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aspects where they have made the energy classes (IE1, IE2 and IE3) and the law is that it need to be IE2 AT LEAST, and here they want this done before making “material classes”) Hans Schou Christensen Yet another question; but lies the principles with leasing products and take-back and recycling also within these then? (Rikke explains: Well we don’t know what they will end up with from the EU but it looks like it is these 8 focus areas mentioned they have at the moment, so I do not think they will change these) Hans Schou Christensen So the standardization request has its standpoint in these things they have written about wishes and intentions to the final legal law? (Rikke and Anders: Yes, you could say that, but as stated it is very general in its description; re-useability of products could be any number of things of course, so it is a framework on products components and other to the customers etc. So the time itself to extract the components in a sequence has also been written a theoretical template about this subject and how these production processes could be made. Also documentation requirements requesting that the process of disassembling these components is written down to third parties. The business cases (green business models) should then also be revised according to durability, do we sell less product in the long run.) Hans Schou Christensen I also would assume that if you made products more durable they would initially be more expensive, and this would have to be driven by law, like if you make products that are more expensive then the competitors than these will never be sold or hit the market, so it wouldn’t make a difference anyway as it would not be used and lastly re-used. Rikke Dorothea Huulgaard (Supervisor): My understanding of this is that the EU want to look into the material efficiency aspects, but at the moment has no concrete ideas on how to make legal requirements to these aspects. Therefore they look at developing the standards before the law (or making them in parallel).

In terms of EcoDesign and Integrated Management Systems with use of 8 material efficiency aspects mentioned? (ISO 14062) a) Do you know the 8 methods from the EU standardization request on material efficiency?

Hans Schou Christensen: So it could be standards on how to do the methods on measuring these aspects and not so much legal documents, to see what level we need to be on (methodological standards then) (Rikke and Anders : Yes, that is it) Hans Schou Christensen: No, I don’t know these 8 methods as proposed by the EU. Well I have read and “googled” what I could find and that is where I am at now. So if you have anything then I would love to receive these.

b) How does your part of the organization work with these 8 eco design methods currently?

Hans Schou Christensen: Again our department is only involved specifically with standards that are legal requirements, so I cannot answer this question at the moment. I cannot exclude the other business units around Danfoss working with these however, but it is not something we know about (since not law), and it is a large operations, so we do not know everything that is going on, only when the legal aspect is a part of it.

Rikke Dorothea Huulgaard: So you are not currently a part of the development work with these standards in

Hans Schou Christensen: Well, no on the legal aspect to change the laws then; NO. But on the standardization aspect then we take part in this, not exactly on Material Efficiency, but in regards to other standards. In law it is mostly lobbyist in Brussels who are working to affect and be a part of this. It is though a level below law (as seen by us) the standardization work. It is a little

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regards to affecting the law in a favorable manner?

unusually that the standard comes first here before the law. We have of course, in about 2 days, been switching to some new directives which has come from the EU in 2014, on EMC directives and there the standards were previously existing (unlike here) so there we are “just” updating these directives to the newest one making smaller adjustments affecting us in a lesser manner. In these circumstances the directives and standards are easier to implement, though most of our directive in CE marking(labeling) the is an assumption that standards are harmonized under the directives, listed in official journals, then we assume that they cover the directive completely and we as such need to live up to these directives by following the standards already. With the new directives there is only one example of one directive that has published a list of official standards, and for the remainder, than we in two days are not going to use harmonized standards, because there is fact not standards directly under the directives because they have not had the time to do this yet. But we have an idea/assumption that it will be the same standards though. When we are on directives and the mandates level, then the mandates level we are following the development, but are not directly involved in the process as it is a level lower than the law.

Rikke Dorothea Huulgaard: What is going to be the determining factor to if you will be taking part in the standardization work then?

Hans Schou Christensen: It will be looking at what there is currently in place from the EU, and Eigil Hansen (Global Approvals Director) who will take the choice to be involved in the development work finally and one of use being chosen as a part of this, for example Preben Holm could be deemed good enough for the purpose even though he is a part of Drives, he could still be chosen as Material Efficiency specialist/lobbyist too to see where it is most reasonable in terms of resources to be put into this, but it could be highly relevant to take place, but again at the moment we have no concrete directive or mandates to go by. I have always had the idea that standards came afterwards the law, because this is natural, so this is new.

c) In what degree are these 8 methods integrated into the current management system (ISO 14001) in regards to making an optimal decision in the product development process?

Hans Schou Christensen: I have no knowledge to any of this, if integrated, therefore there might be. It is not something directly affecting this part of the organization at the moment. So individual business units would have to be a driver for this themselves currently.

Rikke Dorothea Huulgaard: Joint Research Center (EU) has made a lot of research on how the material effiency aspects could be measured, reflecting these 8 methods, these types of reports and research do you look into these?

Hans Schou Christensen: It is not something that we in our department look into, although it might be relevant for me to see these; I have just been giving this assignment to follow-up on these, but it is relatively new, So it is only what I have been able to find. In other subject like, safety standards, I can say how we do this; we give a message to the rest of the organization if requirements are about to be change, what direction it is headed so the rest of the organization can adapt as early as possible.

Rikke Dorothea Huulgaard: But where is it that your department takes part of this

Hans Schou Christensen: Strictly speaking certification and approvals, there we cover the majority of Danfoss, but there are individual Business Units that runs

(stand work.) For example Preben Holm for Drives?

this themselves completely or in cooperation with our department, so Danfoss Drives runs this themselves (as it only regards Danfoss Drives products) and they have a tradition for having these departments themselves. Today they only have approvals on product they make a lot of, so when they comes a product standard a little more “exotic” something they don’t deal with every day they usually get hold of us to help them out as the line of reasoning is that some of the same questions might be coming from other business units at Danfoss. When it is something you don’t delve into everyday the knowledge is going to be weak at the individual units, so most often we get these kinds of assignments in our department.

d) How could Danfoss integrate material efficiency aspects into product development How will these 8 material effiency methods be implemented at; •Where will it first come up and happen?

Rikke Dorothea Huulgaard: Let’s say if we look at one of the proposed 8 methods; e.g. taking out the components of the products and upgrading these (accessibility of components and upgradeability) this would be horizontal for all your products, (•Through what channels and streams would these requirements be communicated?) •Who is involved in the process (Strictly communication speaking here)

e) Do you assess economic, social or environmental data currently for your different options within product development material efficiency aspects in the product’s life cycle?

Hans Schou Christensen: I would think it would appear when it becomes more concrete, in the form of some legal documents. We have to live up to all relevant laws (compliance aspects) and there has to be something driving this.

Hans Schou Christensen: Then we would convey these out to all the business units, that there is a set of requirements coming, the same way that we have just done with the new directive (CE, EMC radio equipment directives) and in connection with the new directives; there are these topics you need to be aware of. Rikke Dorothea Huulgaard: But you don’t have a role in regards to going a step beyond what the law requires to be prepared for the future and on what demands there might come, you are more legally binding and legal compliance and nothing more ? Hans Schou Christensen: This I cannot answer, but when it is affecting our department, it will definitely be compliance aspects, therefore there can still be another level where these things are decided, but I simply cannot say. Rikke Dorothea Huulgaard: So if Danfoss had an ambitious goal in the sustainability policy, then it would not go through you? Hans Schou Christensen: No, It would not. We “just” communicate already legal documents to the rest of the organization.

Hans: Is it weighted compared to something else? (No just these three, Rikke: Do you at your department even make these assessments?) Hans Schou Christensen: Not in our department, others do these, cannot answer this question. I of course know then when designing a new product than economy is a major driver, but of course the social responsibility is also there. We have a department which works with these, and our setup guidelines, and it is not that we compromise these guidelines in exchange for economic incentives, but otherwise it is economy that drives all major decisions. Can therefore not quantify this. We have the Danfoss Negative list and have signed some agreements in regards to work/labour arrangements, cannot remember these however. These subjects I am not a part of, as not in our department. Product and Materials, is a part of the environment like Danfoss negative list, else we have our ethical code of conduct (what besides economy counts).

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Rikke Dorothea Huulgaard: I just saw (in the diagram) that EPD (Environmental Product Declaration) is assigned beneath your legal department, what is meant by this?

Hans Schou Christensen: I cannot answer this for material efficiency, in regards to the RoHs directive I can answer. (Rikke: There is a standard DS50598, for environmental product declarations and life cycle assessment for drives, motors and motor starters, but is it not a legal binding document so far, is this something you look at?) Hans Schou Christensen: No not here as that standard is specifically targeted Danfoss Drives A/S

Rikke Dorothea Huulgaard: Back in ’12 there were these pilot projects regarding the environment, but it has not seen the light at your department?

Hans Schou Christensen: No at it would most likely be a part of Production and Materials instead under the Regulatory function in Group Legal. This structure is relatively new, it is from the beginning of the year (2016), it is something new that we are a part of Group Legal also, before we were a part of Danfoss Business Systems (which was not that much in common with, but it was where we were placed. They work with optimizing everything: Cost reductions). We have previously had taken part in RoHs and WEEE directives and the others had worked with this too (overlap). REACH and RoHs, was assigned us because they are CE marking directives. WEEE is also product, but the remainder (EPD etc) is very product specific, even though they are interrelated. The product materials function also sit next to us as of now, so we have some overlapping projects with these.

Rikke Dorothea Huulgaard: I would like to ask you, Eigil(Choice), in regards to the mandate M543 from EU on material efficiency, what would determine if you from Corporate would involve Danfoss in this development work of this Standard? (Not just Preben)

Eigil Hansen (Global Approvals Director): Well it is something that will be decided after Preben Holm (standardization specialist) has taken part in the first set of meetings, and then we will discuss with him where in the process we are and would be wise to move. Then we will take this up for discussion in our part of the organization, because we in regulatory have a link into the different segments, where we will inform these, and in principle it is the individual segments that can say, based on our recommendations, should we involve ourselves in this work or move later on. So it is not us alone who makes the decisions, but in collaboration with the different segments managements teams and then from here on the decision will be made to move on or not on this standardization work.

Rikke Dorothea Huulgaard: How proactive will you be at Danfoss in regards to not knowing if this will become final regulatory requirements, but still being able to affect these in some manner?

Eigil Hansen (Global Approvals Director): Here it is somewhat divided, because our end-game is the “clean” legal requirements, with the minimum set of demands that we need to live up to as an organization. Then we also have the other stakes within the management perspectives and intentions saying we need to be very green and sustainable, and these we cannot withheld ourselves to before we have been given mandate to this, which requires the managements given this mandate saying it is this we want to move on, then we can start programming this. It is very rare that this comes from the four individual segments, but more as statements from the top management, that we want to go this way.

Rikke Dorothea Huulgaard: When does management hear about this new standard request then?

Eigil Hansen (Global Approvals Director): They get the info through many different forums, one of which is Public Affairs, which informs the management about the current trends. At some point then the EC (Executive Committee) decides that Danfoss should do so and so, which then makes it operational as a demand, that we must secure that we are compliant with this directive. So it is very complex process with the different forum. The principle difference is that we here have all the legal requirements which we need to be in compliance with and then the political intentions at Danfoss, what we want to do.

Rikke Dorothea Huulgaard: So as a department, you at the moment have no opinion to

Eigil Hansen (Global Approvals Director): No, no we do not. We can have a subjective opinion, but cannot do something to make it operational before the law is made final and a mandate has been made by Danfoss. For example when

this new request? TO-BE(Assessments) •Structure in the organization How does the organization diagram look like for Danfoss Global Approvals? Where is the responsibility placed for overseeing the monitoring of the material efficiency goals for your organization?

What do you think should be monitored to achieve implementation of these material efficiency goals successfully in the organization?

Rikke Dorothea Huulgaard: What was the different between Public and Industrial Affairs?

management said we wanted to introduce TS1649 as a quality management system, it is not a legal requirement but it was decided by them anyway, pure management decision. So it could be made a final decision by top management.

Already Answered (See organizational diagram for Group Legal)

Eigil Hansen (Global Approvals Director): Today we are a consultancy function, so when a decision like this has been made at Danfoss, then it is the four segments responsibility themselves to have this implemented. They can normally not do this alone, without our legal advice however. So it is in this manner we help with implementing new standards, as a consultant answering; how, when and where it can be implemented. The basis info comes from us, but the segments remain responsible, we do not take full responsibility for this.

Eigil Hansen (Global Approvals Director): Well again, it should be the management that makes the political decision that we want to go this way, and they do this based on some economic speculations and some evaluations on what market position we have and could have by implementing this. So here the missing links and elements are missing here for top management to do this, they do not just say: “Wow it looks interesting, let’s move on this”, THEY NEED SOUND JUDGEMENT. Typically Public affairs or industrial affairs would provide them with this and lays out the pros and cons of this decision. Eigil Hansen: Public affairs is higher up the chain in the hierarchy, with the political agenda, and Industrial affairs is more within each different segment (like Aksel Jepsen for Danfoss Drives) .

REFLECTIONS Your opinion on the material efficiency perspective within product development and EcoDesign?

Danfoss seemed highly interested in collaborating in the future on these subjects (other companies Grundfos of interests as well) Rikke needs info on if Danfoss wants to be a part of different company cases, like Danfoss and circular business models.

Rikke asks about the Workshop she held 3 years ago in ’12 and how her contact Fleming has utilized this since then: Eigil Hansen: This has awoken some thoughts and began the discussions about these topics, because the mindset was triggered then: based on the limited amount of resources we have, we need to have some models and methods in place for reusing and recycling these. So I think the work shop about this was really good in the way that it started some thoughts. This was the basis that also mentioning Drives A/S looks a lot at this, because it will be more a drives in the future. So the question is more the timing, we are a organization living on profit and not just “good will” and still need to follow the trends in the market, to be able to compete. Your work shop was an eye-opener for this, but for us the timing comes first, so the info coming from the EU needs to be processed internally and then showed to management, to be able to implement these standards and directives later within a given timeframe. It is a long process, and important, Look for example at China and how they use resources. We simply cannot keep using resources the way we are doing now for future generations…

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(AS-IS profiling) •Profile Questions: What is your role at Danfoss & Responsibility area? How long have you been in your current position?

Preben Holm – Standardization Specialist/Lobbyist at Danfoss Drives Date: 18/4- 2016 , Location: Gråsten, Interviewer; Anders & Rikke I am responsible for our standardization activities at Danfoss Drives. This mean I am the connecting link when we look at standardization in our organization and try to make it structured. To enable that we have focus on the right areas within standardization, electrical safety, functional safety, or energy efficiency, or EMC&Harmonics and here in question the new material efficiency request; this would be the dotted line. (See figure for explanation below). I try to ensure that we have the correct people does the correct activities on these, not that I have any direct management responsibility but I try to ensure that we have someone taking care of each part, as naturally I cannot oversee everything. Experts are required in each specific field to get a better “nerdier” understanding of these subjects. I have been in my current position for 4-5 years or so.

Diagram of the Standardization Group and four Areas

What environmental concerns does your part of the organization work with?

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We have made a process in the last 5 years, and tried to structure this process more; Honestly speaking it is not us dealing with organizational structures, so it is with a heavy heart when I say that we do not have the necessary organizational structures when looking at standardization, so we are now a group (standardization coordination group)(as shown above) including Aksel Jepsen (Head of Industry Affairs Drives A/S) who want standardization to be a key topic and this group has then been put in place to manage and try to control these issues. Two from Industry Affair, one from our daughter subsidiary in Offenbach, Germany, and me from the Development Department who is in charge of this. We try as our core job, to keep focus on this and have some people placed primarily in our development department in the individual areas (ES, FS EMC, Energy eff. etc.). In the future I hope of a better structure to be able to say that standardization is placed here, and this is why and the meaning is this. (Kind of bad answer I guess). We have come from a situation where the competitors say; Preben “are you a One man Army?” Now we have more competent personal, because one of the problems when talking about energy efficiency was that I was “just assigned” this since I was already working with other standard already and my competences was not very high in this area, now Norbert, a skilled employee, handles this. He runs a big project, framing the structure. One thing is also to have standardization within CEN and CENELEC (ESO’s) and IEC but it also needs to be used and implemented within our organization. Within Energy Efficiency have build a reference group consisting of personal from Development (R&D), Product management and Sales as a project and try to forms our policy on Energy Efficiency, same goes for all the other areas (EMC, Func. Safety and electrical safety). This is the first time we have had standardization in the course of a project, we can hope that Material Efficiency will be the same in the future, and make a similar reference group, with a new employee skilled in this. The whole standardization refers to our Danfoss management management group, informally speaking now, but will hopefully in the future be placed more official in the Danfoss Drives organization., Comparing with

competitors perspective we are on the same level as other similar compeditors, but behind Siemens and Schneider Electric considering structures, across the “broad line” on all four areas. Energy Efficiency has been strong focus with heavy support from management side. We need to be clear as well for material efficiency, to support our business model. Your own personal experiences with Danfoss’ environmental policy?

I do not have much experiences when looking at environmental policy, I understand something about WEEE and RoHs and EPD (environmental product declarations), I have not been directly involved in these however, so cannot answer how we have handled this. But clear is that when there are legal requirements we need to meet this, the breaking points then is when and how soon you do as a company met these requirements.(before and after it is legal, 2-3 years before law is made). ENERGY EFFICIENCY was the right time to take this subject and run with, besides material efficiency from the EU, this has been something WE HAVE to do. Then we could have sat and waited or get going when the going gets tough. I am relatively close to the people working with these standard developments in Brussels, and I inform the rest of the organization of these, as it is a democratic process of course, where all can discuss what is “fair” and then compromises and what should be on our agenda is made at “the big table”, it is however not rocket science ;) Standard DS 50598; Mandate (M476) was made as part of the standards, this standard is part 3, which goes a bit beyond subject as part 1 work with energy efficiency on systems level and part 2 on frequency converters (VLT) on the extended product approach (EPA). Part three is life cycle assessment, and what materials and energy accounting looks likes, we have not been part of making this standard. The standard was part of a TC22XWG6, and made especially by another task force, and we worked with parts 1 and 2, so we followed up on what was happening in the process inactively. Historically speaking the customers were hard to convince on energy saving, but with this Mandate we got some laws which helped us convey this message, and we early in the process said; “this is really good”, then when the EU said you need labeling of frequency converters, it made no sense, since they have 98 % efficiency, and they overheat if any higher. We used it however as a lifting effect, to support this and our core business model for energy efficiency to say: “Yeah we focus on system aspect on these energy efficiency issues” and can see the positive effects of these.

Rikke Dorothea Huulgaard: As I understood it from Aksel, the EU has not adapted this fully with the energy demands for frequency converters?

They still focus on energy labeling on frequency converter, even those it makes no sense. I think it is because of the large consumer products, like washers, driers etc. which all have these labels and the common man simply can read and understand these. IT is not here the saving lies, just mere peanuts( 0.1 %) and 60% could be saved when thinking systems; like taken both the motors, pump and VLT frequency converters and making them running on less capacity (not optimum efficiency point) individually but in the large spectrum of the system they are running within run more optimally together in a system level. We are of course taken the energy labels into consideration as this is a legal requirement, but our main focus is at the system level where the big energy savings are.

Rikke Dorothea Huulgaard: Are you guys part of the process and can affect how a standard is finally developed?

We need to look at two aspects; One legal aspect (from the EU) we need these. Our industry association (CEMEP) is a part of this, and some of our competitors are a part of this process too, a long way we have common interests with our competition which is good, as they sit in this task force. When the mandate for standardization is published; we speculate when and how we should involve ourselves in this process and this is decided in our standardization coordination forum and sent to the management forum when we have made the final decision to take part. We then need to “buy-in” with qualified inputs and feedback, sometimes we say; “This we simply do not

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have the resources for, so we focus on something else. •Standardization function How is the standardization function organized at Danfoss? Ask about stand. 50598-3 (See picture on phone) How are you involved in the standardization work to improve and prepare yourselves for upcoming new possible standards?

a) What topics are you setting on the agenda?

Electrical, Functional, EMC and Safety aspects.

b) Through what steering organ do you use to get your opinions across the line? (Industry Union etc.)?

CEMEP --//-- (Industry Union)

c) What stakeholders are involved in the process?

Within Standardization in work group G22, there is some of our competitors like TESLA motors. That is the majority, but Cenelec and IEC would also like to see some legal personal, which to my knowledge not have been present so far. It is again a question of resources, when these take part. The lawyers are deciding in EU and US sometimes when the standards become laws, but I don’t really know when they appear in the Process. When taking EU, the Danish Working Environment Service handles these (Dansk Arbejdstilsyn) which then following needs to uphold the law, and they are part of some task forces, and one man from the Danish Safety Environment Service (Sikkerhedsstyrelsen) is on the group TC22 as well.

d) There are 8 methods as part of material efficient product solutions options -How will these 8 methods be implemented at Danfoss,

I honestly at the moment do not know; You could say that something that we are missing today is the CONCRETE requirements to what needs to happen, as these 8 topics need to be weighted somehow. I picture that as manufacturer; you can pick some of these options and then classify these in a point based manner to achieve some rating/labeling (maybe B+). But this is completely black as TC111 has not started working with this yet (the working group). They are first forming the framework for how it should run. I think that we cannot however simply wait for these 8 topics to just “appear” in 2019 (plus implementation time), the horizontal standard needs to be formulated by then 2019 however, and then the working group for SC22G needs to make the product specific standard the next 3 years. The question however is; will we even get so much time to adapt these 8 deliverables? My convection is that if we focus on not just assembling the product as fast as possible, we need to shift focus on the disassembling process as well! In the future the demand for taking our products back, the third party taking these products back, need two things; both taking the product back and getting for example 100 DKK for each product they take to manage these OR we say; will you buy our products and the owner ship for 100 DKK? (Remain in ownership/sell them forward) So either it would cost us more money, or we

-Where will it happen, through what channels and steams?

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As mentioned we are a part of the industry union; which was called CEMEP. Purely strategically speaking the mandates are discussed here, and then we are also a part of the standardization bodies, and as of 1 st of April I will be chairman for the 22G work group (for frequency converters). So I have position myself in a manner to affect those standards for frequency converters, and of course we have an agenda on which way to go, but most often we have common interests. This is the direct way to affect and not control but manage how the discussion is going. We then make a standardization strategy, evaluating the standard under development; How vital is it for our company, how does it fit the products, and how will we finally act upon this. I am an IEC project manager (Convenor) on Electrical safety level, and have two standards at my desk, to try to influence this process.

could make more money. We need to consider that the the product we develop today, they need to be discarded in 20 years, in I speculate that this Standard will be set in stone by then and we will need to adobt anyway. So there it would be a must to disassemble our product in its individual parts most efficiently (instructions for these and time frames/template etc) When looking at our products, it is typically a LARGE aluminum frame; there has to be recycling available; BUT what is necessary for this postprocessing process; this is worth a thought, also what components are critical for the products life time and durability, so we can replace these and make the life time longer (double it perhaps) and sell the product twice maybe?. Not rocket science again ;) Traditionally not a mindset in our design, beside replacing the fans or DC-capacitorse.g.

-Who is involved in the process? (within the Standardization group)

First and foremost, you would need an expert project management leading the material efficiency team; beneath him the developers and designer in product development and perhaps sales and other standardization personal. One of the function is to affect the standards development and at the same time extracting this info to communicate to the rest of the company to the project undergoing to avoid “just to keep boiling the hot water” it makes no sense to do this if it is not finally implemented in our products (wasted resources). The major driver; gather info and involve these in our processes to be on time the right time. In regards to the current material efficiency, I follow up on this on a desktop level, and try to convey the rest of the organization to take this seriously, like with energy efficiency. The question is will this become a reality, but as one work group colleague stated to me “either way if we want this or not, it will come, because we do not have unlimited resources here on earth” (material scarcity). Don’t lose the “beat” and keep up the trends.

e) Where would you like to move towards regarding material efficiency and the standardization function? (moving from energy/material resource focus towards systems optimization focus)

Generally speaking, we would have liked Material Efficiency aspects to have come later in the overall process, not to say we think it is a bad idea, but we are afraid of them loosing focus on Energy Efficiency, as we have just scratched the surface here, so would like more focus here. But in general a positive attitude, as you can differentiate yourself on this topic as well and strengthen the “green image”, but clearly it has come too soon, but I think it will become a part of our development function anyway.

Rikke Dorothea Huulgard: When you say too soon, what are you referring to? (this whole process about material efficiency….the timing compared to energy efficiency is not very good.

I mean that historically speaking, it has all come too late, should have happened decades ago. The timing however going from energy to resource/material efficiency has been to abrupt and small, so we are afraid of the energy efficiency “looses it breath”, which would be a shame for the discussions going on around the companies, and the industry union (CEMEP) could really give some insights to this agenda as well.

Rikke Dorothea Huulgard: Aksel mentioned that the EU couldn’t find “more interesting” products to make standards on, and you mention that the union and Danfoss pretty much agree, Aksel said that they may also hinder the progress of this system levels thinking, why do you not focus more here? I think we do have full focus on thesystem thinking through our participation in standardization.

One of the things behind this is that our business model today; manufacturing frequency converters (stand-alone) and some of our competitors make converters with built in motors attached. When we look a systems thinking we are part of this, but here the water to say are divided ; generally speaking systems thinking is good, but underlying that HOW(strictly business speaking) to position yourself within a market, is not so clear. We at Danfoss Drives convey the message that you can take any motors and use our frequency converters easily (high flexibility) whereas some competition states that; No, take our motors and converters, which was simultaneously created perfectly for one another (perfect fit), making it the most optimal solution. HERE we are of course not agreeing, our system is better  So it lies in the details to out compete the rivals.

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Rikke Dorothea Huulgard: What should happen to delved more into systems?

Well from the EU, they have already made this quite clear, and those working with the systemic approach state that this approach is the way forward. I do not think a lot will be changed, mere details. However it is a question of focus and setting the agenda that system it the better option for higher energy savings in the long term. So far as I know the HVAC area, want to move it another direction than system, as they have a higher capacity rate that can be utilized still.

f) How does the road or steps from standardization request towards implementation at Danfoss look like?

My recollections of it, even though not the officially described document, which is somewhere, I can say at the moment, is that typically there is a Draft paper on this request, which the EU wants to send out, the RSVP to respond to this and if it makes sense is then 14 days, then they adapt this. Material Efficiency request was shot down once because of many critical feedbacks, so there was a second round before the final 17th December 2015. When the consensus has been made the standardization request is thus sent out to the three standardization steering bodies of the EU (CEN, CENELEC and ITSI, described in the Annex) which then the choice from manufacturers to then either sit back and relax or get involved is made.(first option to play it risky). We then decide, yes, we want this standardization mandate, then there is two groups working on each their area, and then the formal standardization process is then starting, adhering experts personal in different work groups and the process from here is usually 3 years, which is what the EU deems necessary (like ’16 -19 for Materials later on when the structure as mentioned before has been set and the overall time frame) CENELEC and CEN has said yes to take this mandate standard request for materials, but in which committee the standard developments lays and the work is formulated has not yet been decided, because both two steering organization has said yes so they need to make a joined group for this.

•Your specific organization What is the key role of your organization within the group at Danfoss Drives? A) Does your organization have any specific goals for (the 8) environmental material efficiency aspect?

We have so far as I know, not any yet. This is to be speculated on where we have the focus on. We are in a hold position.

What customer demands and demands from other stakeholders are there to the product development process according to you (material)?

I don’t think there is relatively much for this. There is a large demand and requirements specification list on performance, electrical safety functionality, and durability (life time of 10 years defined) however. I don’t think any change in the last 10 years for product design has occurred though. No concrete design spec on material efficiency, but a large project underway, on how to implemented and realize these is going to happen.

List after importance for implementing material efficiency, the following 4 stakeholders (stakeholder analysis) a. customers b. employees c. society d. authorities

In terms of EcoDesign and Integrated Management Systems with use of 8 material efficiency aspects mentioned? (ISO 14062)

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You could say that; customers and authorities are two of the big players, as our customers are typically not an end-use product but delivered to OEM (original equipment manufacturers) customers how demand these. When looking at energy, the legal authorities (EU) has been the main driver, we have been use to the demands coming from the customers, material and energy however has been from the authorities influence the other way round. No doubt in regards to implementation the employees play a large role in implementing the requirements, but this is more in regards to what happens if we don’t follow these rules. If purely material request then authorities are rated highest. Society wise the two subject energy and materials become more vital, my wife at Sønderborg Municipality e.g. look at this at the waste management office, and has been doing this the last 6 years, and now it is a going to be a part of the private sector and not just public anymore.

a) Do you know the 8 methods from the EU standardization request on material efficiency?

No, but had them explained before.

b) (How) does your part of the

No, not today at the current moment, as it is to unspecific and not concrete

organization work with these 8 eco design methods in product development currently?

today, so we do our best guess and try to follow-up on what is going on and what are the proposals to have these implemented, when they are becoming a reality. We look in new project at them, but do not have the focus decided of where to optimize material efficiency methods.

c) Why are these 8 methods in regards to making an optimal decision in the product development process, put in place to begin with?

Why? It is for me relevant on two areas; resource scarcity becoming larger and larger, so there is no question if we want to; WE are forced for the future heading towards waste becoming resources (DR1, showed five minutes one electronic waste recycling). If you e.g. dig in the dirt the for each 1 ton dirt you will get 10 gram of gold(mining), if you do this for electric waste (urban mining) you will get 100 grams worth of gold, a factor of 10 times more efficient. (Waste is food). Secondly: We traditionally have not had this mindset, and its need to be profitable, and in the last end how to make it profitable, not just by getting the legal requirement, but as a manufacturer making it designed for disassembly and profitable business case, hope that was an answer to your question( Anders: yes thank you, in regard to next set of questions as well)

d) Do you assess economic, social or environmental (triple bottom line of sustainability) data currently for your different options within product development material efficiency aspects in the product’s life cycle?

The economic is of course a big driver, from the view point that it is a balance; because what does it matter to make the most expensive and recyclability product; IF we cannot sell these? Then it does not hit the market even, and hence not can be recycled. The market is then flooded by the cheaper non-recyclable products. Balance is key as the environment aspects need to be favored, and the social responsibility should also be a part of the company.

TO-BE(Assessments) • 8 Demands on material efficiency Assessment of importance: (Rate: 1-8 which has the main focus in your organization as of now)

Materials

Use Disposal

-re-use of products - re-manufacture of products recyclability of components -recoverability of components -durability of products -upgradability of products -ability to repair products -accessibility of components extraction

Specific questions regarding the material efficiency deliverables:

No I don’t think we recycle the products, because the entire business model today runs around selling the product (VOP) at the ordering point and the owner ship lost here (like for cell phones). As long as there is no legal requirement that you by force need to take-back the products or in some other way is stated it is necessary this will be of low focus. The re-manufacture of product is critical because of the demand of high quality, which we need to ensure (warranty and quality) how do we do this, again in circular economy, who says that the product needs to be owned by the customer, if we sell the service of the motor being on and function and taken it back to be repaired in a leasing manner, the first four aspects would be of more use to us. No one today wants a used product the same goes for components. And the only recoverability we have today is for our plastic which we label to be able to recover these. Durability wise there has been speculations about high usage “wear and tear” components that break down sooner and more often, has a higher breaking point, so these are calculated on profitability on (could be ventilators, heating or electrical capacitors), which we run a routine service on to prevent the break-down rate. The upgrade we are doing is softwarebased, and as this is only a small part of the material aspect it is rated medium for us. Repair is rated high. We are not anywhere near being able to have high accessibility rate for our product/components, and we also need to make maintenance plans also regarding design phase options making these and these components easy so access from the beginning. We have components that are potted directly in the product in a liquid mass, and when the product needs to be taken apart it becomes one clump, which is kind of a shame, it is only a few more compact product which a high encapsulation rates (located in

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a) Ability to evaluate the ease of access or removal of certain components or assemblies from products to facilitate their extraction at the end-of-life for ease of treatment and recycling?

Use

Disposal

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We are not good enough at this, naturally as this process has first begun, so we have not had focus on this and we have not yet built these competence. I do not see this as a problem now, but if you were to talk with you in 2-3 years and I would respond the same then something definitely went wrong from here on.

B) Ability to evaluate the access or removal of certain components, consumables or assemblies from products to facilitate repair or remanufacture or reuse?

We can evaluate on repair, but not on how to disassemble the products/components for remanufacturing process later. This is not evaluated, I would like “the red thread” that when pulled every component dropped out easily and be picked up (more modular architecture). Today our focus is on assembling (montage) and not disassembling. Needs to be a part of evaluating the life time of product and the business model in the future. (the model makes money on customers prolonging life, more leasing money)

C) Specific Method to assess the proportion of re-used components and/or recycled materials in products?

No, not that I Know of. You mentioned that Aksel said, that future customers might not buy new products in the future (20 years), if the world looks like today, same competition parameters, but if the durability is a competition is a competition parameter in the future then it looks bad on us if we say that the product life is 10 years still, if the competitors say theirs are 20 years etc.

D)Documentation and/or marking regarding information relating to material efficiency of the product taking into account the intended audience (consumers, professionals or market surveillance authorities).?

Materials

system where water is present etc.) that use this manufacturing process. We have not made enough progress in this, and it needs more thoughts.

Assessment of eco design methods (not including EcoAdvertising): (Rate: 1-8 main focus at the moment.) 1.Design for Components: The strength of parts 2.Reduction of Materials and design for disassembly: The sustainable lightness of materials 3.Material discretion: The use of mono-materials and bio-based materials 4.Recycling and Reuse: Multiuse of materials 5. Systemic Design: Zero Emission systems 6.Technology for sustainability: Techno/Ecologically sound products 7. Service Design: 0% emitting products 8. Size reduction: Decreasing the volume of the product

EPD, we have some literature on this, but this is not my core areas (more maintenance, BOM, and databases have these materials listed in the company RP systems). Cannot however answer this directly.

It will be for components sad news, as they are not currently designed for individual components. Reduction rated higher and materials disassembly as mentioned not a focus. We typically use the same set of materials when we produce products, aluminum for our cooling apparatus and plastic one types, but more economic factor buy “buying-in-bulk” larger quantities, but the synergy of environment and economy needs to be more mature and the time right (green procurement, sound more expensive, either should have both optimized). We have a clear strategy in regards to the life time of the products, but this is not affected by the law, but has been the same through the years, but it has been designed to hold and analyzes has been made on the reliability of these product as well, so the material efficiency has not influenced this systems aspect directly. I don’t have a lot to say about the technology. The service design is high repair rate. The products has been made smaller, in the degree of we think of stacking the products most efficiently, but we have many demands on the products size, we have made the products more compact, on the OEM customers installed with the focus of Cost-Reduction aspect and not Material Efficiency, so the customers has an easy way to maintain and install the smaller compact products the “cheapest” way possible (the synergy however is nice to have) so this size (cost-reduction) is rated the highest 8 out of 8.

REFLECTIONS Your opinion on the material efficiency perspective within product development and EcoDesign?

I think I answered this; I am clearly a forerunner for this material efficiency. I think It is an interesting subject and it shows responsibility for the entire society and for the future generations, so we need to make our business sustainable in this manner as well.

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(AS-IS profil) •Profil Spørgsmål: Omkring hvorfor Group Legal og Reguatory kom med som en af fem interviews (var først kun fire folk som skulle interviewes)

Hvad er din rolle og ansvars område ved Danfoss? Hvor lang tid har du været ansat i din nuværende stilling?

Jamen jeg har en titel der hedder Head of Industry Affairs og det handler om at være vores (Drives) person der varetager vores interresser i forbindelse med branche organisationer mest i udlandet og vores interreser i forhold til EU lovgivning, jeg deltager en hel del i møder i forbindelse med EU både med hensyn til at overvåge og deltage i ”stakeholders meetings” men ogsp med vores corporate affairs, og påvirker de beslutninger er bliver taget , så det er i meget korte træk det det handler om. 1,5 år har jeg været i min nuværende stilling. Jeg har været mange mange år på Danfoss, afbrudt af en periode udenfor Danfoss men det er over 30 år alt i alt.

Din egen personlige erfaring med Danfoss miljø politik?

Hvad skal jeg sige til det, jeg syntes faktisk vi har en meget asnvarlig miljø politik, både mht. Til det lokale miljø her på egen; vores fabrikker, vores arbejdes miljø, det eksterne miljø men også med hensyn til vores produkter, især med vores produkter som jeg syntes er nogle meget ansvarelige produkter, forstået på den med at de stort set alle sammen er energi besparende så de opfyder nogle gode behov og gode formål. Men praktisk erfaring med vores miljø politik vil jeg ikke sige jeg har, jeg har ikke sådan selv været involveret i at etablere miljø politikken og formulere den også videre.

Rikke Dorothea Huulgaard: Da jeg talte med Bruno i sin tid, da havde i de her regionale standarder på forskellige ting, sådan nogle interne dokumenter, det er ikke dem i har mere så, fordi du sendte mig et link til noget andet? Hvilke miljøhensyn arbejder du med I din del af organizationen?

Hvordan arbejder dy med miljøhensyn i forhold til produkt udvikling? •Din specifikke organization Hvad er din rolle i organizationen indenfor din division I danfoss drives? A) Har din organization nogle specifikke miljøkrav i forhold til materiale effektivitet

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Aksel Jepsen – Formand for Industry Affairs Danfoss Drives A/S Date: 18/4-2016, Location; Gråsten, Interviewer: Anders & Rikke ...Men jeg syntes det kunne måske være interrresant at have Group Regulatory med indenover simpelthen fordi at den struktur der er ved at blive bygget op om hvordan vi håndtere alle de krav og at der kommer en struktur og samlet koordinering nu med vores Corporate funktion ind over der og også mht. overvågning af hvad der sker rundt omkring vil de også komme til at spille en rolle så ikke mindst for at få det strukturelle overblik så syntes jeg det kunne være en god ide at få med. Han vil måske ikke kunne sige så meget om selve materiale effektivitet men spørgsmålet om hvordan vi organisere os tror jeg er mere det han kan komme ind på.

JA jeg fik ikke rigtig svar på om de(dokumenter) er udgået de der standarder, men de er i hvert fald blevet overhallet er det vi har på vores hjemme side nu. Vi har også lige fået en ny sustainability/bæredygtigheds politik som måske i også skulle kende hvilket handler om groft set at vi vil halvere vores energi forbrug, tror jeg det er, indenfor en række år. Og der er både et mål omkring energi forbrug, der er også et mål for C02 forbrug, så de to ting er der sat nogle nye mål op for, så noget mere aggrasivt end vi har haft før, og det er igang med at blive rullet ud nu, og det kommer til at bygge på ”energy managment audits” som vi laver på de store fabrikker, som man så udra det kan se hvor der er muligheder for at gøre noget. Der er også overvejelser om at lave nogle interne C02 pris, altså sætte ”carbon trading” internt, så man for det med i inversterings beslutninger, så det er en meget ny ting der er kommet ind i billedet. Der stor noget om den på vores hjemme side og findes også en præsentation vi kan få fat i for det er noget vi også fortåller udenfor huset. Det er Flemming Lynge Nielsen (leder for Sustainability) der har alle de ting omrking vores miljø politik og nye mål, er han specialist, så syntes i skulle tage og ringe til ham på et tidspunkt (tlf. Interview). Han har et nyoprettet stilling som ligger under Corporate Public Affairs.

Vi har nok ikke andre miljø krav en dem der er lovgyldige ift. RoHs og WEEE og alle de der love som ligger nu fra EU’s side, der er også andre krav fra andre verdens dele som vi selvfølgelig også skal leve op til så i øjeblikket

vil jeg mene det er stort set udelukkende bestemt af lovging. Rikke Dorothea Huulgaard: I har ikke sådan noget med at jeres produkter skal kunne holde (selvfølge garanti preriode) men udover den?

I forhold til 8 metoder opstillet fra EU omkring materiale effektivet (se næste side og indkorperering i ISO 14000 ledelses system (ISO 14062) a) Kender du de 8 metoder fra EU standardiseringens forordningen på materiale effektivitet? Rikke Dorothea Huulgaard: Det vi talte om i tlf. var at nu går EU over til at lave krav til denne type emner, og i vil gerne arbejde videre med Energi Effektiitet, kunne du uddybe det?

Jo der er, helt ud over den normale del af vores produkt specifikations en udover vores design lever tider, altså den tid man designer til; hvilken levetid både i timer og år og hvad er det for et miljø de skal kunne holde sig i, så der er en design retnings linje på det punkt, hvilket er forskelliget fra produkt til produkt, der kommer an på hvilket marked og applikation det indgår i så jo det ligger der, men det betragter vi som en normal del af en produkt specifikation. Derofr ligger de i produkt specifikationen (legal compliance del) og ikke mht. Levetid, men kunde krav og positionering på markedet og hvordan vi ved Danfoss ved differentiere os fra meget holdbare produkter eller lidt billigere men knap så holdbare produkter, så det er et spørgsmål om hvad er du (discount eller høj kvalitet strategier), man er nødt til at have sit sær kende.

Ja ja jeg har læst mandatet igennem og ved hvad det går ud på såden nogle lunde (læser de otte krav/metoder fra EU’s side op for ham)

Jo det vil jeg gerne, det er jo et direktiv der dækker både energi og materiale siden af produkter til energi-relaterede produkter (ErP) og ”det er egentlig en diskussion som kommer udfra det trejde arbejds program som blev præsenteret i slutningen af 2015, og jeg deltog selv i et stakeholder møde i Bruxelles da de præsenterede dette og det var helt tydeligt at de er ved at løbe ud for gode produkter at regulere på” altså det var jo fyldt med produkter som realt set ikke gav noget at regulere på (i virknings grad) f.eks. jeg syntes det mest strålende eksempler er at man har overvejet at sætte et effektivitets krav på noget så simpelt som el kedler (stående hjemme på bordet) og spørgsmålet lyder så; hvor effektivitet kan man lige koge en liter vand? Så syntes jeg vi er ved at være henne hvor det bliver meningsløst... Det eneste produkt vor man kunne spare noget, var sådan set heller ikke noget produkt men et system; Building Management Systems; altså systmer i bygninger der regulere klima og energi , system altså ikke produkt. Dette syntes jeg peger i en retning af at Eco-Design direktivet er kommet i et dilemma for hvad skal man ny gøre? Man har ligesom udtømt mulighederne ved at kigge på produkter og komponent niveau, der er ikke noget der giver mening, man har gennem årerne taget de mest energi slugende apperater og så har det givet noget, men nu står man der og skal finde på noget andet, og der igen med alle de hidtidge har man stort set ikke beskæftiget sig med materil effektivitet(selvom anden del af det) og ikke brugt kraftet på, kun energi, og nu kaster man sig så over materiale effektivitet. Det syntes vi er en forkert retning, fordu energi effektivitet er slet ikke noget i hus endnu, det vi er nået i hus med er at regulere på komponent niveau, men all ved (mange rapporter) at det er i systemer man kan spare lang mere energi, end bare på komponent niveau, altså hvis man optimere et helt system er der langt mere potentiale (faktor 10) en ved at regulere på enkelte komponenter. ”Vi bruger gerne tal fra en EU rapport fra 2009, tror jeg nok, hvor man stort set er kommet frem til hvis man tager det samlede energi effektivitets potentiale kan 10% adresseres ved at regulere på komponent effektivitet (pumper og motorer eks.), 30 % kan man gøre noget ved at adresses et motor drevent system, med motor, frekvensomformer, og pumpen samt den belastnings systemet er udsat for, skal man lige huske, som i langt de fleste tilfælde er variable og ikke fast. Så får man så mulighed for at bruge frekvens omformere til at kapacitets tilpasse, hvilket giver den store besparelse på 30%. Udover det er der stadig 60 % som kan adresseseres ved at lave system optimering, for et vandværk med pumpe kan det være at bruge et større rør med mindre friktion i rør og ventiler, så der

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er jo langt mere ved at adressere systemet.” Det naturlige vil for os være at gå videre og være færdige med at kigge komponenter og eneri effektivitiet og derefter kigge energi effektive systemer, men det gør de(EU) så ikke , men materiale. Rikke Dorothea Huulgaard: Når du siger Systemer, går det ud over Extended Product Approach (EPA) eller?

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Ja, for der er både extended produkt approach som egentlig isolere selve motor systemer (motor, pumpe, frekvensomformer) og dens belastning, men så er der jo så også et større system udover det som man så også kan gøre noget ved. Der har vi også nogle holdninger til at vi syntes man skal arbejde paralellet, der er den konventionelle holdning fra myndigheders side, at man først skal regulere på komponent, som bagefter kan regulere på EPA og når vi så er færdige med det kan regulere på systemer, og i praksis betyder det at vi alrdig kommer til det sidste punkt. Vi syntes egentlig hellere at man skal adressere de tre områder parallelt, for det er jo forskellige værktøjer man skal bruge. Komponent niveau kan man lave en lov der siger at den skal være så og så effektivt, men jo mere man går over i systemer jo mere kompleks bliver det og sværere bliver det at lave en lovgivning og egentlig kontrollere det. Der kommer an sandsynligvis over i nogle mere bløde værktøjer. En af de problemstillinger der er, er at når man går over i systemer så bliver EU kommisionen mere afhængig af at virksomheder i branche organisationen arbejder sammen og hjæper, fordi der skal så meget Data til, og det har kommesionen alene ikke chancher for sat skaffe og det bliver meget tydeligt at det der i virkeligheden er barrierer om de pågældende branche organisationer ønsker og deltage, og når jeg siger det her er der sikkert mange bracnhe organisationer der slår fra sig og siger; det passer overhovedet ikke, men det er det vi kan se der sker. Det gode eksempel er den europæsike pumpe branche (EuroPump) med Grundfos i spidsen, har været meget prograssive siden 2006. er gået ind og sagt at skal der være lovgivning vil vi selv være med, og de driver faktisk den udvikling i reting af systemer, og det ser ud til at vi i løbet af et par år for et nyt pumpe regulering som fastsætter krav til pumper og pumpe systmer på system niveau, og det samme kommer til at ske i USA, som er indført og træder i kraft i 2019, men det betyder et sort skift fra at kigge på pumpen kun og ny hele systemet. Man kan se også i den analyse som er lavet (med pumpe analyse i EU) at de har fastslået at hvis man fortsætter med at regulere på selve pumpen så kan man spare per år, ca. fem TwH, mens hele pumpe systemet per år, kan spare et niveau mellem 39 og 49 Twh, åltså næsten 10 gange så meget. Det ilusstrere ganske godt hvad der ligger i det (rapport sendt til os, og 2009 rapport).

Rikke Dorothea Huulgaard: Energi styrelsen var også på jeres side i denne sag?

Ja, det mente også at vi er slet ikke færdige med energi effektivitet, og selvfølgelig skal jeg også nævne at når vi nu er så ”vilde” med energi effektivitet så er det jo også fordi vi laver produkter som der bliver mere behov for når og hvis det kommer en sådan lovgivning, så der er jo også en grund til vi er interreset i det.

Rikke Dorothea Huulgaard: For lige at blive ved det her (system tilgang) et øjeblik mere, hvem er det så i stor sammen om at i vil kikkge på system tilgang, hvem har i fået samlet om det?

Det er jo vores branche forening indenfor frekvensomformere og motorer, som er der vi ser den største interresse i at skubbe det i den udvikling. Jeg vil ikke sige at branche foreningen er så vidt at de er fuldstænding klar i mælet om de ting, så hænger det lidt de er ikke fuldstændig gået op for dem, men vi arbejder for at få dem med, så det ser vi som en meget vigtig ting, at foreningen har en klar holdning om det her, og presser på for at bibeholde fokus for at kigge på energi effektivitet (CEMEP: Europæisk branche forening for; el motorer, frekvensomformere EMCs og høj og vidt spændings motorer) Grundfos’ hed EuroPump. Vi har en ret bred kontakt flade til EU ikke kun for Drives men også gældende for Heating, Cooling og HVAC for Danfoss og Drives og vi er alle enige om at det er system fokus og ikke

material fokus, så det er noget vi fremfører ved alle lejligheder vi har for EU kommissionen, som sådan set er enige og det er ne vigtig pointe, og nogle af de bedste rapporter der ligger klar om dette område har EU selv lavet så kommisionen er fuldstædning klar over hvordan det hænger sammen, men deres problem er som sådant; Hvordan skal man lave lovgivning for det, hvad skal man gøre ved det? Deres værktøjs kasse, rækkker kun til komponenter, og det strander ved de mere komplekse systemer, da EU kommisionen ikke er i stand til at skaffe det data grundlag der skal til bare for at finde grænse niveaut for hvor ligger vi henne. Man siger også i kommissionen at man kan ikke gennemfører en lov der går helt på tværs af industrien, så industrien skal være med, med eller unden data, så det er der det hænger; de fleste vil jo nok sige at det er myndigheder der stiller sig i vejen, men der vil jeg sige det er industrien der selv stiller sig i vejen, og der håber jeg at vi i vores branche organisation kan etablere et samarbejde med de andre indenfor det område der er vigtig, og vise de fordele der er vigtige, som vist af EuroPump, som siger at i virkligheden så har de valget mellem at accepter komponent regulering, hvilket vil betyder at branchen i EU skulle bruge millioner på ar udvikle mere effektiver pumper med en meget lille gevinst og resultat, og uden mere profit af den grund. Alternativ kunne man tilbyde at lave et system hvor man som man kan bruge og opnå langt flere energi besparelse og hvor man ikke skal bruge flere investeringer i mere effektive pumper. Branchen sparer derved penge og kan på samme tid markedsføre mere effektive løsninger. Den detalje har andre brancher ikke fattet, ved at man kan lave gode aftaler med kommisionen og derved sparer branchen nogle penge men samtidigt spare mere energi end ellers. Rikke Dorothea Huulgaard: Hvis man udvider er det så ikke nogle flere aktører der skal ind over? Eller er de, de samme som når man taler komponenter?

Rikke Dorothea Huulgaard: Har EU taget EPA til sig?

Der er nok nogle andre, det jeg snakker om her er når man taler om EPA, når man snakke pumpe system og en belastning, det samme gælder for HVAC, det er det samme og sparer det samme. Der er sket det at der er kommet regulering i 2016 at ventilations anlæg skal forsynes med enten en multispeed motor (3 hastigheder) eller der skal være en frekvens omformer til at regulere kapacititen, så der er kommet et krav som er trukket ned over hovedet på branchen. Det har de fået uden at få samme slags fordele som pumpe branchen fik, fordi samtidig er der meget barske krav til ventilatorers virknings grad, så der ligger der en standard for test, der er krav for selv ventilatoren og brug og frekvens omformer, men der er ikke krav til energi effektivitet for systemet deri, så der kan man se hvor det kommer fra også, fordi to domminerende virksomheder i EU laver motorers med integreret frekvens omformer i, og ved at det er lovpligtigt for de 2 fordele i fohold til alle andre i branchen, så der er ventilations branchen splittet i to ift. pumpe branchen som kunne stå sammen. Muligheden for at have lavere energi effektiver motor med frekvens omformere, forsvinder nok i 2020, fordi man peger på de store problemmer med at kontroller de IE2 motorer med frekvensomformer tilslutter; bliver der i virkeligheden sat en frekvensomformer på? Det er sværet at kontroller (på stedet) har myndigheder ikke kapacicitet til. Der er vist en begrundet mistanke for at der sker snyd med dette.

JA principielt har de, men det først sted hvor det bliver brugt er pumper, ventilationens er ikke brugt der er kun kommet et krav men ikke på system niveau. Problemmet med at man skal bruge en frekvensomformer uden at bruge Extended Product Approach (EPA) er at man har ikke en standardiseret måde at beregne energi effektivitet, hvilket vil sige at dem der er gode til at lave gode systemer, ikke kan bench-marke sig og lave det til en konkurrence fordel, hvilket er en af de ting som pump branchen kan når de for deres standardisering igennem med målepunkter og tal for hvor effektivt er det her system det skaber en hvis konkurrence firmaer i blandt hvem der kan laver de

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bedste systemer. Men altså i forhold til materiale effektivitet, er vi ikke imod at man kigger på dette vi er bare imod at man mister fokus på energi effektiviter, det skal man fastholde samt indrage materiale her (ikke enten/eller). Rikke Dorothea Huulgaard: Det her stakeholde meeting du nævnte tidligere var det i EU (tredje arbejds programme) ikke noget materiale på dette?

Jo der ligger en rapport hvor man har beregnget dette også (som jeg vil sende). Der kan i tydeligt se de forskellige typer af produkter man har kigget på også.

b) Hvordan arbejder din del af organisationen med disse 8 eco design metoder(krav) indenfor product udvikling på nuværende tidspunkt? c) hvilken grad er disse 8 metoder integreret i det nuværende miljø leddelses system (ISO 14001) for at kunne lave en optimal beslutning I forhold til product udviklings processen med bæredygtigheds aspecter i mente? d) Vurdere du/i økonomiske, sociale eller miljømæssige data på nuværende tidspunkt udfra de forskellige muligheder indenfor produkt udvikling når man kigger på disse Eco design metoder for at optimere materiale effektivitets apsekter i produketets livs cyklus?

TO-BE(Vurderinger) • 8 krav materiale effektivitet Vurdering EU: (vurder: 1-8 hvilken er jeres hoved fokus)

Materiale

- gen-brug produkt:

- gen-produktion af produkt:

Brugs

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- genbrug komponenter: - gen-vinde komponenter: - hold-barhed af produkter:

Det har vi ikke fokus på, da det ligger ikke som en option/mulighed at vi skal genbruge produktet, det er installeret og så kører det endtil det ikke virker mere, hvis det bliver genbrugt er det kunden selv som finder på at bruge det. Det gør vi heller ikke idag, generalt kan man sige idag at der ikke er nogle krav til materiale effektivitet og det er vores konkurence even på markdet (økonomiske kriterier) der bliver brugt. De bliver ikke genbrugt, idag. Det gør vi sådan set heller ikke. Meget vigtig fokus, hvis vi kigger her, ligger den i den høje ende (7/8) Da det er konkurrence parameter, vores produkter holder længere og skal kunne sidde ude i en applikation i 10 år, uden nogen form for forbyggende service. Mange skal her skift ventilator, men vores holder (gennemsnitlig

- opgraderingsmuligheder:

-reparationsevne produkter:

Affald

- tilgængelighed af komponent udvinding:

længere end 10 år= nogle 20 år, 15 år i gennemsnit)- Vi laver også under 1 KW produkter og 5 MW som de største, og det er jo forskellige markedet og økonomier i det. Den store 5 MW er 20 meter skabe langs en væk, hvilket skal kunne repareres (ikke flyttes) Software kan opgraderes, fordi ellers kalder vi det reperation. Det er ikke som med kommercielt software, opgradering foregår kun hvis der er problem i applikation (ikke løbende opdatering) vi kigge på dette. ( Ikke så stort fokus) Vi er her nødt til at skelne mellem store og små; de helt små bliver ikke reperaret, man kan måske skifte køle blæser eller display men det er det, ellers bliver de kasseret. De store (5 MW) man du skifte alt ud komponenter og det er simpelthen et spørgmsål om økonomi og at betale en service teknikker. Vi giver kunden valget; købe nyt eller reparere (ved små dyrere at reparere) men mulighed der. 3 for små og 7 i de store anlæg med service kontrakter. Det kan jo godt skilles ad apparaterne, man kunne godt genbruge kabinent, men man gør det ikke normalt (spørgsmål om økonomi) ikke noget vi har såm politik, eller design kritirier, men i hvilken grad vi kan reparer et produkt, men ikke genbruge komponenter, hvilket har nogetat gøre med at hvis man sælger et produkt så skal du give garanti og dette begynder blive kompliceret (stå indefor disse komponenters garanti)

Vurdering af Eco design metoder design fasen(ikke med eco-reklamering): (Vurder: 1-8 hoved fokus nuværende tidspunkt) 1.Design i/for komponenter 2.Reduktion af materiale og design for adskillelse:

3.Materiale skøn: brugen af mono bio eller ikke organisk material: 4.Genbruge og Genproduktion: flere brugs/funktioner af materiale 5.System design: Nul emissions systemer

6.Bæredygtig teknologi: Teknologisk/Ecologisk produkter opgradering

Det er der meget lidt fokus på, og kan mange gange ikke lade sig gøre at få komponenter ud. Igen det med materiale forbrug er et økonomi spørgsmål, så der bliver gjort meget specielt for elektronik produkter for at mindske materialer (rå matierial og komponenter) kan udgøre 70-80 % af prisen, det dyreste er power electronic komponenter, og disse kan ikke genbruges (fastsat levetid). Der er fokus på det, men ikke af hensyn til material, men økonomi. Jeg mener ikke, ikke mig bekendt, så det ligger i den lave ende også. Det vi gør, at vi bruge den samme type display (et display) men ikke det samme gamle display i et nyt produkt, så komponenter i nyt produkt kigger vi ikke på. Det er noget der begynder at komme i ind i diskussionen, men har ikke været fokus på endtil videre (vi vi drive den agenda), ikke holdbarehed men mere i forhold til enegi forbrug, det indgår med stor vægt at vores produkt passer i et system, det er lavet sådan sa det kan køre med mange motor typer, som den selv indstiller, mange sammenhænge den kan indgå i. Vi kan reducere de motor tab der er, som er påvirket af frekvens omformer, vi kigger samlet på disse to og vil have disse to effektive, det nytter ikke at frekvens omformer er meget effektivet med store tab på motorens side. Det har ikke noget med opgradering, men ønkset er at produktet er selv opgradering/og optimererende og passe med alle motor typer (temeligt højt vurderet) Serviceability, ved jeg ikke hvor tit de skal have service. Der er typisk ikke regelmæssigt service, men udskfitning af køleblæser efter 10 år, ved de rigitgt store produkt grupper er der service intervaller (i service kontrakten) krav på regelmæssigt service, ellers kan vi ikke stå idenfor dette. Hvis vi snakker de

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store produkter ligger det højest. 7. Service design: 0% udløsende produkter

8.Størrelses reduktion: Formindske strørrelse af produktet Rikke Dorothea Huulgaard: Inden vi hopper til strategi, så vil jeg lige spørge indtil hvordan i indirekte er involveret i materiale effektivitets standardens udvikling?

Rikke Dorothea Huulgaard: Har du nogle punkter som du ved du vile sætte på den dagsorden; hvad vil i arbejde for?

Rikke Dorothea Huulgaard: Så er der den her standard 50598-3 som er for motorer, og del 3 handler mere om miljø deklarationen (EPD), jeg kom i tvivlt ang. lovgivning hvor mang stille krav er vil ikke trådt i kraft?

Rikke Dorothea Huulgaard: Hvem er det der er ansvarlig for at i leve op til disse krav her på stedet?

Rikke Dorothea Huulgaard: Implementering af det, det er så Preben Holm når det er i 2018?

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Ja det er der meget fokus på, men vi bruger polysterene, da nogle engang regnede ud det var mest miljø venligt. Der bliver brugt to skærer der ”wrappet” det med plast, samt beskyttet det. Dette tilpasser produkter til at ligge på en palle, og komprimeret mest muligt. Vigtig del af produkt specifikation (pakning). Selve produktet og pakken også.

Altså det er noget vi har besluttet os at vi vil involvere os i dette, vi er ikke selv en del af den standardiserings kommitee som står for det, men via. Vores netværk (med Preben Holm) sidder formanden for den kommitee som er medlem af en af de standardiserings kommiteer som preben sidder i eidnefor Power Electronics, med et link hvor den kommitee har et ønske om at vide havd der foregår og også komme med input, så det er på anden hånd det kommer til at foregår. Det er mere et praktisk resource spørgsmål om tid og kræfter og lyst, da vi føler os mere end tilpas med at påvirker udviklingen den her vej. Det har noget at gøre med hvor tæt man er knyttet til den person, derfor har vi besluttet at det er OK at gøre de via Preben endti videre. Det er nok ikke noget vi har gjort så meget ud af endnu, det er ikke noget vi har bearbejdet internt, hvad vi skal gøre med den Mandate M543 endnu men vi vil være med. Jeg tror også at når vi snakker materiale effektivitet er det ikke vores produkter man først vil starte med, det er nok noget med consumer-products altså store hvide varer med store styk lister. Derfor forventer vi ikke at der kommer noget lige med det samme ang. vores produkter , men den er standard sætter rammerne (framework) for hvordan man måler disse ting (metrikker) så på den måde er det vigtigt at vi kan leve med disse også selve vi ikke forventer det med det samme. Så mere den måde jeg ser der på, vi vil gerne være involveret i at påvirke udviklingne i en fornuftig retning som vi kan leve med på lang sigt. Nej den her har status af en, Horiontal standard, for motorer som i del 1 angiver en metode for system effektivitet, del 2 specificere beregninger for motorer og frekvens omformerer hvord er er et krav der relateres til standard i 2018 hvor der kommer krav til frekvens omformeres virkningsgrad, dette ser vi ikke som noget problem, men det giver ikke noget til frekvens omformeres med henhold til at spare energi , vi syntes der er masser af rapporter der siger at motors systemer bruger forfærdeligt meget energi hvor frekvens omformerere kan være med til at reducere den energi meget, så derfor sætter vi krav til frekvens omformeres effektivitet; dette ses som hul i hovedet. Denne mangel på logik er vi efter. Den har i del 3 også forestået EPA og hvordan man gør det, lovgivning bestemmer jo så om de vil bruge standard (to vidt forskellige ting) så de har så valgt at bruge den omkring hvilken effektivitets klasse vil man så kræve at frekvens omformere har IE1 bliver kravet i 2018, og 0,1 TwH sparer man derved om året (peanuts). Det er jo vores produkt udvikling, i og med der kommer et lovkrav er det noget der indgår i vores produkt specifikationer. Vi har også en bestyrelse (board) der tager sig af nye krav og laver beslutninger for hvad der skal ske, og der board skal kigge på vores produkter og sikre at vi leve op til disse krav når vi kommer hen imod 2018. Ja, det kommer til at komme ind os vores Product Management som har ansvaret for vores produkt specifikationer som så skal revalidere de specifikationer, og for de produkter der sælges i EU skal de så have indført

den specifikation at man skal leve op til den EU lovgivning der kommer til at følge det her? Rikke Dorothea Huulgaard: Har i arbejdet med de her Miljø Deklarationen(EPD) og livscyklus vurderinger?

Rikke Dorothea Huulgaard: Det bliver ikke et decideret lovkrav i 2018? Da jeg snakkede med Flemmig Lynge tilbage i 2012, nævnte han der var lavet nogle pilot projekter omkring miljø varer deklarationer? •Strategi i organisationen I hvilken grad kender du jeres miljøpolitik og strategi ved Danfoss (Danfoss corporate environmental policy- Strategi mål) A) Er der elementer I jeres miljøpolitik some du mener burde styrkes (Vis eksempler hvis ja)?

I hvilken grad forventer du at samarbejdet mellem jer og jeres kunder/leverandører vil få store focus på materiale effektivitet indenfor de næste 2-3 år?

Ja det har vi danset rundt omrking i et stykke tid, og vi har også stillet os selv spørgsmålet om hvorfor vi skulle gøre noget ved det, da det er del 3 der beskrive dette i Annex omrking EPD, der er også mange andre standarder der beskriver dette, og vi har undersøgt blandt vores kunder om der overhovedet er nogle der stille krav; Nej der er der sådan set ikke. Mne vi har jo en standard der begynder at stille krav, og Del 3 er godkendt i EU som en EN ESO standard, der er så ikke lavet en tilsvarende ISO standard for 3-del som del 1 og 2. Det kommer, og vi er på vej til at beslutte at vi i 2018 kan leve op til del 3 af denne standard 50598, Det er vores arbejds team lige nu, det er ikke besluttet endnu, men skal gøre i slutningen af April måned. Ideen og forslaget er at vi ligger os op af del 3 og stille og roligt forbereder os på at implementere denne så vi i 2018 har miljø varer deklarationen på en del af vores produkter. Nej det gør det ikke, og vi har ikke set nogle deciderede tiltage til at det bliver det i 2018. Jeg tror ikke det kommer. Ja men der er lavet nogle pilot projekter og der har ligget stille siden, og nu tager vi det op igen, i forbindelse med at den er indført; så vil vi gerne have en beslutning; gør vi noget ved det eller gør vi ikke noget ved det så at undgå den diskussion?

Ja det tror jeg bestemt der er; Altså det vil nok komme i den række følge at vi først og fremmest vil kigge på hvordan vi kan genbruge materialer (recycle) er det materialer der kan smeltes om og genbruges. Det sidste er vel nok at kunne genbruge produktet, og opgradere det så det kan bruges igen (hoved reparation). Det tror jeg bestemt, man kan også sige at hvis man skulle bruge de principer omkring opgradering og genbruge produktet så det får en ny livs cyklus, hvis vi skulle lave længere leve tid på produkter, vil det være en ret dramatisk forandring på vores foretnings model, det er virkelig en ændring. Idag er den baseret på vi sælger et bestemtn antal produkter, hvis vi sælger det halve pga. længere leve tid (vil ske gradvist) så skal vores model skiftes, og det er også derfor vi interesser os for det, og dets konsekvenser hvis vi skulle lave denne om, hvordan skal den så se ud, vi kigger ikke på dette endnu, men det ligger i forløbet, da man vil blive nødt til dette. Intern er der også en forventning om at dette kommer til at ske mere og mere på et tidspunkt med gode begrundelser for det simpelthend pga. Materiale Knaphed. Så det vil ske, så vi kan lige så godt vænne os til det? Jeg tror sådan set ikke det vil komme til at spille en stor rolle indenfor de næste 2-3 år, der hvor vi snakker leverandør så er det mere omkring materiale deklarationer, hvor der fra elektronik er rigtigt mange komponenter er det noget af en jungle at få alle disse materiale deklarationer for hver enkelt komponent beskrevet, som vi vil se mest arbejde med de næste 2-3 år. Det vil ikke gå så hurtigt (2-3) med materiale effektivitet, og jeg ved godt at EU har sat 2019, og ret mange af os tror ikke på at dette holder. Hele klimaet i EU er jo også at de ikke påligger mange store og mellem store virksomheder nye krav, det for en lidt længere gennemløbs tids. Med det mandate (M543) er det hele metrikken og målepunkter for reference produkter man prøvet at gå gennemført, og lavet basis for dette. Den ene ting er dette, men parallelt med dette skal man samtidlig lave en lovgivning og det tror jeg er urealistik i den

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•Strukturen i organisationen Hvordan ser jeres organizations diagram ud for Danfoss Drives A/S? Hvor are ansvarsområdet placeret for at overse monitoreringen af materiale effektivitetsmål for din organization?

Hvordan på nuværende tidspunkt opfølger i og monitorerer performance af materiele effektivitets mål hos jer?

Hvad mener du burde blive fulgt op på og kigge igennem for at man opnår success med disse 8 materiale effektivitets mål?

Rikke Dorothea Huulgaard: EU holder med jeg i system tankegangen, men har du nogle overvejelser for hvem der ellers arbejder for at få materiale effektivitet ind?

Rikke Dorothea Huulgaard: Kunne man tænke sige at man ville gå mere standardiserings vejen istedet for system vejen med at få udviklket noget?

REFLEKSIONER

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tidsramme. Og selvom selve reguleringen kom i 2019 vil det nok være noget med at den først træder i kraft et vist antal år efter i industrien. Traditionelt diagram, hvor du har udvikling, supply chain, salg og marketing (sendt diagram på PDF). Jeg har et diagram men ikke på stående fod. Det vil ligge i forbindelse med udvikling, der kan man gøre noget ved det. Man kan sige at hvis vi kommer der hen hvor man kigger genbrug og returnering af produkter, så er vi også over i service sandsynligvis. Men i øjeblikket udvikling der har ansvaret for at implementere lov krav for nye produkter. (produkt specifikation) Group Product Management også som er en seperat funktion. Det ligger i Produkt Management og også i Udviklings Funktionen. KPI’er bliver der løbende sat krav til, dels er der et løbende effektiserings krav, og et cost-reductions krav som er et antal procent fra vores supply chain organisation som lever op til, Så vi har delt ansvaret i 2, så der er nye produkter der bliver udviklet som udvikling har anvar som (lever op til produkt specifikation) og når den er OK, kan det overdrages til vores supply chain (produktion, indkøb og produkt vedligeholdelse)- Når det løbende skal forbedres mht. Cost reductions af det vores produkt vedligeholdelses funktion der hr ansvaret for det (2 faser i et produkts liv). Han Schou er Corporate, Helge Nielsen sidder vel i vores Supply Chain Organization, men jeg må være svaret skyldig. Altså hvis der kommer en lov så bliver den implementet, ingen diskussion, hvis det bliver del af CE, skal vi leve op til det. Noget andet er det frivillige, som godt kunne tænkes, det ville være noget som kunne forbedre vores konurrence position på markedet, eller hvis koncernen som helhed fastlægger koncern mål i forbindelse med sustainability; Idag er det med hvad vi udleder af C02 og bruger af energi, men der er ikke nogle målsætninger for vores produkter. Der vil være meget lang tid til man går der hen, fordi det man siger er at produkt områdets eget ansvar, Men det kunne godt være der kom nogle interne frivillige krav, men det er lantgt ude i fremtiden. Nej ikke udover, en række NGO’er som har det på deres agenda, og som presser på. Det ser ikke ud til det er kommet ind på virksomhedernes agenda, der er nogle få meget store virksomheder som stiller krav til materiale deklarationer, ikke vores kunder, men vores kolleger, men det er kun en deklaration, ikke noget krav til produktets materaile egenskaber. Så jeg ved ikke lige hvor drivkraften skulle komme fra. I takt med der kommer standarder hvor man kan måle det hele, så kommer der mere bevisthed og så vil vi også begynder at interessere os mere for det. Ja det er noget vi meget gerne vil, altså den der EN 50698 standard den ligger kun rammerne, den beskriver metoden, og vi ser nu at pumpe branchen bruger den standard fo at lave en for pumper og det skal der også komme for de andre appilkationer, der skal komme end for ventilations anlæg og en for kompressorer, osv. Med grundlag i den horizontale standard, skal der komme applikations specifikke standarder for at får disse etablereret. Fordi før man har en standard der beskriver hvordan man regne et effektivitet index ud for en bestemt applikation kan man ikke komme videre med det... Det er noget vi på den kort bane vil presse på via vores organization og jeg har på min agenda. Først og fremmest vores egen branche organization, men også at få disse til at samarbejde med andre branche organizationer og få dem igang med det helt konkrete standardiserings arbejde. Et helt konkret målsætning vi har, som både retter sig 2 delt mod EU, myndigheder, og branche organisationen. Den største forhindring værende branche organisationen på nuværende tidspunkt. Spørgsmålet er om vi kan flytte dem, fordi der er

•Livs cyklus perspektivitet for ISO 14001 og produkt udvikling Hvor har du og din organization mest inflydelse på produktets livs cyklus stadier/faser? Hvordan vile du prioritere de fem livs cyklus stadier? indenfor; (Rate 1-5) give en 1, en 2, en 3, en 4, og en 5 ud til hver 1-5. 1. Materiale (design/rå) 2. Produktion 3. Transport 4. Brugs og livstid 5. Affaldshåndtering

Har du hørt om miljøledelses systemet ISO 14001? (Vurder din forståelse fra 1.ringe, 2. dårlig, 3. middelmådig, 4. god, 5. fremragende forståelse)

splittelse i branchen da der er en gruppe som har forskellige interreser, og er ikke sikkert vi kn få et kompromis her. Generalt, overordnet, den største indflydelse på den første fase hvor vi designer og køber ind, men der hvor vi kan påvirker produktet mest med brug af energi, er jo i design fasen. Så overvejende der. I produktions fasen kigger vi overvejedne på energi forbrug, vi kigger også udover produktions processen forbrug på selve produktions bygningers energi forbrug men også miljø skadeligelig stoffer samt energi og vandforbrug i høj grad. Så det er bestemt også noget vi kigger på, i design handler det om produktets eget energi forbrug og materiale forbrug mere eller mindre kritiske materiale (mest knaphed) og bly i lodninger etc. Transport muligheder; kigger vi på at kigge mest muligt i en last bil (ikke lavet målinger dog på udledning) men i forhold til nye miljø politik er transportens forbrrug (fuel consumption med her i sustainability strategy). Vi har meget fokus på brugs fasen, da vigtig for kunder, kan diskutere om vi er i brugs fasen eller designer til brugs fasen. I brugs fasen er det sådan noget som at vi har indbygget algoritmet der automatisk passer til forskellige motor typer, der er også en automatisk energi optimerings algortime indbyget til at parer energi, også er der indbygt regulartorer til at regulere in process, så der er rigtigt mange ting der spiller ind her, men der kommer alt sammen og er lavet i design fase processen. I brugs fasen gør vi ikke noget, men har lavet foranstaltninger for det, hvor kunden kan aflæse og konfigure produkter samt tilpasse sig igen det nye motor typer , synkronresonæns motorer og permamagnet motorer, der kan den også tilpasse (maskin og produktion), vi kan ikke gøre så meget mere her. Jeg tror at affalds håndtering er lidt forskelligt efter sted, i Tyskland er der lov om at tage paknings materiale tilbage, og der kan service virksomhed tage det tilbage, men selve produktet ikke. Der kommer nogle nye RoHs eller WEEE foranstaltninger hvor de revidere denne i 2019 og vores produkter der skal tages tilbage (el-retur) Den kender jeg ikke særlig meget tid, må jeg indrømme.

A) Bruger du den ofte I din organization?

Nej aldrig.

B) Bruger du livs cyklus perspektivet inkorporeret i ISO for eco design i produkt udvikling? OG;

Jo det betyder rigtig meget i forhold til lovgivning og produkter og deres energi forbrig og materiale forbrug i fremtiden og over hele livs cyklusen. Så det er især i øjeblikket med energi forbruget i brugs fasen det vi fokusere mest på i vores branche forening og det vi vil gå ind for så det syntes jeg hr stort fokus.

C) Har du måler punkter for performance af disse forskellige livs cyklus faser?

Ikke mig bekendt nej, i hvert produkt område måske. Det er noget der ligger i hvert enkelt produkt område så spørg der (Lone Harvest ved måke)

Din holding til materiale effektivitets perspektivitet indenfor product udvkling og EcoDesign?

Jamen jeg syntes det er positivt, jeg har en positiv holdning til det. Jeg syntes man skal holde fokus på det der betyder noget og ikke ligesom det over ved energi bevæger os over i noget der ikke giver så meget meningog er lidt ligegyldigt. Det skal vi undgå, men ikke undekende at inddustrien i sig selv har stor inflydelse på sådan noget.

Rikke Dorothea Huulgaard: I har ikke diskuteret foretnings mulighehden og hvor den ligger for jer endnu?

Nej, det har vi ikke. Helle diskussion har vi ikke taget fat på. For det første i vores branche vil det tage længere tid inden man kigger på det, det vil være hvide varer og andet først. For det andet vil vi også lige se hvad der sker mht. lovgivning og den strategyi de ligger ud med fra EU’s side, der er ikke

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kommet mere, og der er masser af andre presserende emner der tager EU’s opmærksomhed med problemer med flygtninge og folke afstemninger i Englang (Burning isssues) så disse ting falder ret hurtigt ned. Lige nu er fokus på revidering og revisioner er på bynginngs og energi direktivet. Det er der fokus er, selve regulering der skulle komme på frekvens omformerers krav i 2018 har trukket ud og er et år forsinket nu og den process startede i 2013, og skulle være indført nu, og som sådan er det forsent at indføre det inden 1. januar 2018, fordi normalt skal man i industrien har et par år, så ellers hvis det ikke kommer hurtigt vil industrien begynde at stille krav for at den data igen bliver flyttet tilsvarende i den anden ende.

Rikke Dorothea Huulgaard: Og hvad med forstudie bliver disse ikke også forældet, mht. nye teknologi etc.? Starte forfra?

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Jo man kan jo sige at kravene skal jo så ændres, fordi produkter i sig selv sådan set bliver mere og mere effektive, så ond cirkel, det vil vi jo nok ikke som industri gøre noget ved og vi som industri syntes det er latterligt at regulere på frekvens omformerer som ligger på så høj en virknings grad på 97-98% i forvejen. Der er jo et spørgsmål om hvor meget der kan presses ud af citronen stadig...

Appendix M) Danfoss’ Comments document “Eco-design note and questionnaire final” Comments to the document “Eco-design note and questionnaire Final” 1. Danfoss Drives strongly supports the Extended Product Approach (see EN 50598-1) to optimize the energy usage of complex systems, noting that in many cases (as in the example of building management systems) it is the design and use of the system, not the systems intrinsic energy usage or individual components efficiency within the system that leads to significant energy savings. 2. Question 1: As the list has been established by a preparatory study – only exclusions can be suggested. a. 1. Building Automation Systems: The energy efficiency of BMS systems can be established by the use of the so called Extended Product Approach (EPA) where different solution scenarios are compared and the most energy efficient system or the one leading to lowest total cost of ownership – including circular economy aspects – is chosen. b. 4 Lifts: This can also be addressed by the EPA c. 6. Photovoltaic systems (panels and inverters): These can be excluded, as the system efficiency is a key marketing feature (the higher the efficiency the better) and hence further legislation is not required to drive efficiency. d. 7. Refrigerated containers : EPA applicable 3. In addition to the product groups suggested, we would have liked to see a stronger emphasis on a system approach – acknowledging that the verification and surveillance of system energy efficiency is challenging – but worth-while considering the savings potential. 4. As indicated above, the EPA is the approach best suited to determine the optimum efficiency of systems consisting of a number of interacting components. 5. For ICT components an energy labeling scheme, similar to the one used for household goods could be considered. 6. Question 2: If the concept of total cost of ownership is included in the Ecodesign process and extended to include aspects of the circular economy – this may create a self-supporting system leading to solutions with the least environmental impact. However, at this stage we are strongly of the opinion that mixing of energy efficiency and material efficiency will cause the process to lose focus - concentrate on one thing at a time. 7. Market surveillance can only work, if the manufacturers of components are required to indicate some key values concerning the circular economy on their products. This must not lead to a significant expense and work, especially for SMEs. Danfoss supports the trend to increase the use of products with increased durability and reparability, however it is important to keep for a future regulation in mind that products of European manufacturers have also (same time) to meet requirements of global markets outside of EU which might be different in this relation. In general regulations must not decrease global market competitiveness of European manufacturers. In many cases the requirements of durability and reparability and material efficiency and energy efficiency are contradictory – hence the subject needs to be approached with care.

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Further comments on the future direction of the Ecodesign directive implementation. The present working plan proposal is ignoring the energy savings potential in renewing the installed base of (inefficient) old devices/systems. This does bear a huge (much higher than for new installations) energy saving potential and represents a nice win-win-win situation for users, manufacturers and the environment. I.e. the largest base for energy savings of electric motors does lay today in renewing the old installed ones against new and potentially VSD (frequency converter) driven ones. - The user would modernize his installation and save energy - EU economy would benefit from selling new systems/products in a large scale - EU would remarkably come closer to their energy savings/CO2 reduction target. All this will not happen if Ecodesign continues to focus on new installations only. The reports and presentation leading up to next week's meeting indicate that the Ecodesign directive is coming to its limits when it comes to energy savings. The proposed product list only allows marginal savings by regulation. The focus on Building management systems, which is not really a product, but a system of many products, and the difficulties in handling it within Ecodesign, also clearly shows that Ecodesign fails, when it comes to promoting energy savings by systems, which often has much bigger potential than product regulation. Our own product group (VSD’s) is a very good example. Even though we have The Extended Product Approach defined in a standard (EN50598), I do not see any movement in using this concept in Ecodesign regulation, to set up requirements for systems, other than for pumps. We are missing a similar development for other large system groups like compressors and fans and for other systems in general. It also seems that system based regulation is based on the initiative and commitment of the concerned industry, and so far this only happened in the pump industry. It would be important within the Ecodesign framework to develop a generic system efficiency regulation, based on EN50598-1, which should be applied to all motor systems in general and allow comparison between fixed and variable speed systems in terms of energy efficiency. This would be a valuable task to include in the future working program. This is also my proposal to the question about the best approach for systems, which enable energy savings. The methods are already established with EN 50598-1, now the Commission should concentrate on developing and implementing Ecodesign regulations for systems, using the established methodology. Aksel Jepsen Head of Industry Affairs Danfoss Power Electronics A/S Ulsnaes 1, DK-6300 Graasten

Phone direct: +45 74 88 13 61 Mobile: +45 21 70 23 68 [email protected]

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