WATER FOOTPRINT AS A COMPONENT OF LIFE CYCLE ASSESSMENT FOR INDUSTRIES

Transcription

1 About AECOM Global Reach, Endless Possibilities INNOVATIVE WATER MANAGEMENT STRATEGIES WATER FOOTPRINT AS A COMPONENT OF LIFE CYCLE ASSESSMENT FOR INDUSTRIES ASIA WATER CONFERENCE 2012 NG HON SENG

2 Objectives Water Risk Assessment Understand existing initiatives of water reporting / water accounting Introduce the concept of Water Footprint Understanding the differences and similarities between Water Footprint & Life Cycle Assessment Provide an overview of water footprint benchmarking at Micro & Macro levels Page 2

3 Outline Overview - Water Risk - Drivers & Elements & Opportunities - Water Management Strategies Water Reporting Initiatives Concept of Water Footprint - Integration of Water Footprint(WF) with Life Cycle assessment (LCA) - Overview of ISO Benchmark & Industrial experiences Conclusion - Potential Implementation Challenges in Malaysia Page 3

4 Rapidly Changing World of Water Source : World Water Forum Marsellie 47% of world s population will be living in area s of high water stress by 2030 unless new policies are introduced Organization for Economic Cooperation and Development (OECD) Page 4

5 Overview What Impacts Water Climate Change? Population growth? Continuous rise of Asia? Any human activities and policies will have direct impact on water. How will the water cycle change Water cycle acceleration Water cycle intensification Human activities ~ Consumption ~ Product ~ Industrial activities Source : worldpress.com Page 5

6 Overview Industrial Response to Water Issues Volumetric water accounting Estimation of water risk : Qualitative / Quantitative Understanding the risk Mitigation Plans Page 6

7 Water Risk Shared Responsibility Source : The CEO Water Mandate ; UN Global Compact Website Page 7

8 Coca-Cola Water Risk Global Events Norwegian government Texas Instruments or Intel Corporation Unilever Announced a goal to reduce worldwide water use by 20% against 2004 baseline by In 2004, Coca-Cola lost its license to use water at its Kerala, India plant even tough the company made genuine attempts in water conservation in India. They installed more than 300 rain-water harvesting structures in 17 states in India 1,100 companies in its portfolio of holdings, representing 33 billion in value, to meet certain defined minimum standards of water risk reporting and management Estimated shutdown of a Texas Instruments or Intel Corporation semiconductor chip plant due to temporary water unavailability could translate into a revenue loss of as much as $200 million in a given quarter Company Sustainability Reporting indicates that it has reduced the amount of water it used per ton of production by 63% since 1995 compared to 2007, with an estimated saving of USD 26 million between the year th Annual Global CEO Survey by PriceWater Coopers in January 2010) : 41% of CEO s said freshwater scarcity will have a negative impact on their company s long term success CDP Water Disclosure 2010 Global Report : 39% of responding companies reported impacts and half of the respondents classified water related risk as being current or Page 8 near-term 1 to 5 years Source : The Finance Professional s Post : A Publication of New York Society of Security Analyst - 04/22/2010

9 Water Risk Model Concerns & Drivers Source : The CEO Water Mandate ; UN Global Compact Website Page 9

10 Water Management Strategies Key Measures Recycle & Reuse Percentage of total volume of water recycled or reused Discharge - Zero discharge Total water discharged by quality and destination Usage Water use efficiency or water use ratio Quantitative accounting of internal operations Governance Quantifiable targets for reducing freshwater use and wastewater Percentage of facilities operating in water stressed area Engaging with communities Source Total water withdrawal by source Analysis of regional watershed Impact assessment across the supply chain Reducing reliance on conventional drinking water supply Page 10

11 Approach to manage water risk Internal Process Assessment of Existing Practice Risk Assessment Sustainable Water Management Public Disclosure Stakeholder Engagement Page 11

12 Water Risk Corporate Reporting on Water Murky Waters Corporate Reporting on Water Risk -Voluntary & Mandatory corporate reporting of 100 largest publicly-traded companies in Chosen within 8 sectors ; beverage, chemicals, electric power, food, homebuilding, mining, oil & gas and semiconductors -Assessment Criteria s include: -Water Accounting -Risk Assessment -Direct Operations -Supply Chain -Stakeholder Engagement -Opportunities Limitation : scoring is meaningful comparison only within sectors and not across all the 100 companies Page 12 Source : Murky Waters : Corporate Reporting on Water Risks

13 Water Risk Corporate Reporting on Water On a scoring scale of 0-100, no single company surpassed 43 points 73% reports some level of Physical Risk 48% reports some level of Litigation Risk Page 13 Source : Murky Waters : Corporate Reporting on Water Risks

14 Outline Overview - Water Risk - Drivers & Elements & Opportunities - Water Management Strategies Water Reporting Initiatives Concept of Water Footprint - Integration of Water Footprint(WF) with Life Cycle assessment (LCA) - Overview of ISO Benchmark & Industrial experiences Conclusion - Potential Implementation Challenges in Malaysia Page 14

15 Water Reporting Tools & Initiatives Source : UNEP The CEO Mandate Water Footprint and Corporate Water Accounting for Resource Efficiency Page 15

16 Water Related Initiatives Existing Frameworks Water Footprint Manual 2009 Calculation of the water footprint for different sectors (i.e. consumers, business and nations). ISO Water Foot Print - Principles, Requirement and Guidelines (PWI) This new standard aims to provide internationally harmonized metrics for water footprints. ISO14040:2006 Life Cycle Assessment (LCA) Incorporates water use assessment.. LCA has been standardized within the ISO 14040:2006. Beverage Industry Environmental Roundtable (BIER) 3 Formed a Water Footprint Network Group to develop sector-specific guidelines for measuring the water footprint of a product or enterprise. The WBCSD Global Water Tool Excel workbook that maps water use and assesses water risks relative to global operations and supply chain by comparing sites with validated water and sanitation data on a country and watershed basis. Page 16

17 Water Reporting Initiatives Global Water Tool (WBCSD) Page 17

18 Outline Overview - Water Risk - Drivers & Elements & Opportunities - Water Management Strategies Water Reporting Initiatives Concept of Water Footprint - Integration of Water Footprint(WF) with Life Cycle assessment (LCA) - Overview of ISO Benchmark & Industrial experiences Conclusion - Potential Implementation Challenges in Malaysia Page 18

19 Water Footprint An indicator that could map the impact of human consumption on global fresh water resources Freshwater use includes consumption and pollution that contribute to the production of goods and services consumed by inhabitants of a certain geographical region Divided into two; -Water Footprint of a product - Water Footprint of an individual Page 19

20 Water Footprint Blue Water Volume evaporated or otherwise lost from the manufacturing Process Green Water Volume of evapotranspiration from agricultural or forest crops Grey Water Volume required to bring the pollutants to levels complying to local standards For water quality Water Footprint Page 20

21 Water Footprint Source : Global Water Summit 2011, presented by WWF -UK Page 21

22 Water Footprint Export.gov BOTTOM-UP APPROACH Virtual Water Flow as the basic building blocks Estimate the WF by calculating the virtual water content of goods and international trade data The trade data is only traced to the immediate exporting country in most cases, due to the complexity in tracing to the origins of production Disadvantage: time consuming to carry out detailed process-based analyses and inevitable truncation error Page 22 TOP-DOWN APPROACH Individual production processes as their basic building blocks WF is estimated by mapping out the direct water requirements of a particular product system throughout the process chain associated Advantage : This approach can be combined with the methodological framework provided by Life Cycle Assessment

23 Water Footprint Vs Life Cycle Assessment Water Footprint - Measures actual direct & indirect volumes of value chain - Captures type of water use, location, timing - Provides basis for local impact assessment and formulation of sustainable water use strategy Limitations - Does not provide direct measure of impact - Absolute product scores are not meaningful in themselves Life Cycle Assessment - Quantifies all impact categories - Risk weighting water categories generates aggregated impact scores - Score provides basis for comparing products with respect to overall environmental impact Limitations - Aggregating water hides critical temporal and local scarcity dimensions of water - Coefficient for impact weighting subject to interpretation/bias adding to uncertainty Strategic Risk Assessment, Operational Crisis prevention & Real Responses Leadership & Marketing Page 23

24 ISO14046 Water Footprint Principles, Requirement and Guidelines The standard would: Deliver principles, requirements and guidelines for a water footprint metric of products, processes and organizations, based on the guidance of impact assessment as given in ISO Define how the different types of water sources (e.g., ground water) and water releases (e.g., grey water) should be considered, and how local environmental (e.g., dry/wet areas) and socio-economic (e.g., developed/developing countries) conditions should be treated Address the communication issues linked to water footprinting (based on ISO series on environmental labels and declarations) Be compatible with the rest of the ISO family of environmental management standards. Page 24

25 Outline Overview - Water Risk - Drivers & Elements & Opportunities - Water Management Strategies Water Reporting Initiatives Concept of Water Footprint - Integration of Water Footprint(WF) with Life Cycle assessment (LCA) - Overview of ISO Benchmark & Industrial experiences Conclusion - Potential Implementation Challenges in Malaysia Page 25

26 Water Footprint Benchmark National Level Average water footprint of Malaysia: 2103 m³/yr per capita Part of footprint falling outside of the country: 32.2 % Global average water footprint (for comparison): 1385 m³/yr per capita Source : Water Footprint Network Page 26

27 Water Footprint Benchmark Industrial Sectors Challenge we face to ensure world s rapidly growing energy and food demand as to balance this with water security Source : Water Footprint Network Page 27

28 Water Footprint Benchmark Products 1 kg of beef: 14-15,000 liters 1 liter of milk: 880 liters 1 liter of wine: 1000 liters 1 liter of coffee: 900 liters 1 liter of tea: 128 liters 1 kg of cereals: liters 1 kg of steel: 260 liters Source: Water Footprint Network Page 28

29 Case Study Coca-Cola World largest beverage company Water as the main ingredient and is an essential component of manufacturing process Initiatives : - Business unit level qualitative risk assessment in 2004 sensitized the system to water risk - Detailed plant level quantitative risk assessment in 2005 & 2008/2009 Page 29

30 Case Study Coca-Cola Page 30

31 Case Study Coca-Cola Page 31

32 Examples of Initiatives by Companies Social License to Operate (Coke) Local Scarcity Footprint and Targets ( SAB Miller, Levi s) Basin Governance (TSB, Sasol) Human Right to Water (Pepsi) Leadership & Stewardship (M&S, DEG) Shared Risk (Flamingo) Investor Risk (SwissRe, CDP) Page 32

33 Conclusion There is an intrinsic link between the challenge we face to ensure world rapidly growing energy and food demand as to balance this with water security and other global issues, most notably climate change. Need for a holistic water footprint effort within the industries to mitigate water related risk. The global business community increasingly recognizes the water challenge, but to respond effectively it needs guidance, tools, standards and schemes to enable change to more sustainable practices. Page 33

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38 About AECOM Global Reach, Endless Possibilities Water Experience for Each Client s Needs AECOM Water Sectors AECOM Water Sectors Design Build PM / CM Government Services / Federal

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40 Thank You Ng Hon Seng, Country Director, Malaysia About AECOM Global Reach, Endless