Overview of Environmental Trends and IBM Requirements. Focus On Printed Circuit Boards and Assembly World Wide Environmental Compliance

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1 Overview of Environmental Trends and IBM Requirements Focus On Printed Circuit Boards and Assembly World Wide Environmental Compliance John H. Quick Sr. Engineer IBM Poughkeepsie, NY November 19, 2009

2 2 IBM Product Stewardship Program IBM's Product Stewardship program was established in 1991 to bring additional focus to the corporate environmental affairs policy objectives on product environmental design and performance. The Product Stewardship program within IBM's worldwide EMS provides development organizations with direction and goals, infrastructure, tools and expertise to apply environmental life cycle considerations from product concept through product end-of-life management. The objectives of IBM's Product Stewardship program include: Develop products with consideration for their upgradeability to extend product life. Develop products with consideration for their reuse and recyclables at the end of product life. Develop products that can safely be disposed of at the end of product life. Develop and manufacture products that use recycled materials where they are technically and economically justifiable. Develop products that will provide improvements in energy efficiency and/or reduced consumption of energy. Develop products that minimize resource use and environmental impacts through selection of environmentally preferred materials and finishes. Environmental design requirements are communicated and verified with suppliers.

3 Let s Build A Smarter Planet Finding the Value In Green 3 System z: z10 EC System z: z10 BC Power System w/ xseries servers in a rack Various Power Systems Storage: DS8000 System i: 570 stack System x: 3455 Blade: BladeCenter H System x: 3655 IBM Customers want value added Greener products

4 4 Environmental leadership Early Results IBM reduced or avoided CO2 emissions by an amount equivalent to 45% of its 1990 emissions through the company's global energy conservation program. Earned Leadership Status 2009 #1 Green IT Vendor, Computerworld 2007 #1 Vendor Green 500 Supercomputing 2008 CNET UK Business Technology Green IT Initiative of the Year 2008 One of top 15 Green IT companies, InfoWorld 2008, CERES ranked IBM #1 among 63 different companies across 11 different industry sectors for corporate climate change governance practices. 2008, Gartner and WWF-UK ranked IBM #1 among fourteen I/T companies for Basic Environmental Management of Climate Change. 2008, Climate Counts ranked IBM #1 among electronics companies for Climate Friendliness.

5 5 Environmentally Responsible disposal About 1 billion computers will become potential scrap between now and 2010 (IDC, Gartner and the National Safety Council) To optimize TCO benefits, companies require a corporate standard 55% of US-based companies do not have an IT disposal strategy (IDC) In 2006 IBM processed over 100 million pounds of used equipment and sent less than 1% to the landfill disposition strategy Gartner Group

6 6 Road to World Wide Environmental Compliance Is Wide IBM systems are designed and specified to be compliant with all countries' regulations no matter where we ship them

7 7 World Wide Environmental Regulations Examples North America California Waste Electronics Recycling Act - SB 20/50 (CA version of RoHS / WEEE) Product take-back regs in several states Individual State RoHS like legislation adopted or proposed. USA-Environmental Design of Electrical Equipment Act (H.R. 2420) introduced Canada Provincial legislation gaining focus Brazil CONAMA Resolution 257/99) Solid waste Policy PL 203/91 (Draft) Europe RoHs Directives EC WEEE Directive EC EuP Directive EC REACH Regulation (EC) 1907/2006 Packaging Directive EC Phthalates /PVC / Halogen free (future) China RoHS / WEEE Regulation for administrative Measure on the Control of Pollution Caused by Electronic Information Products Catalog published South Korea South Korea: Basic Environmental Policy Act Industry agreements to limit certain materials and for products to be recyclable Other Drivers Non-Government Organizations (NGO s) -GreenPeace, Japan J-MOSS / Basic The Law for the Promotion of Effective Utilization of Resources -3Rs - reduce, reuse, and recycling and Continually Growing No harmonized WW Standard Australia RoHS

8 8 Federal RoHS Bill Introduced in U.S. House of Representatives On May 14, 2009, Rep. Michael Burgess (R- TX) introduced H.R. 2420, which proposes to amend the Toxic Substances Control Act ( TSCA ) to prohibit the manufacture after July 1, 2010 of electroindustry products that contain lead, mercury, cadmium, hexavalent chromium, polybrominated biphenyls ( PBBs ), and polybrominated diphenyl ethers ( PBDEs ) above the maximum concentration levels specified in the European Union s Directive on the Restriction of the Use of Certain Hazardous Substances in Electrical and Electronic Equipment 2002/95/EC ( RoHS Directive ). See H.R. 2420, 4(a). Bill really focused on electronic waste (e-waste) What about a federal take back bill?

9 9 State Legislation and World Wide WEEE Regulations Generally, the scope of products covered is getting broader Source: Electronics TakeBack Coalition (June, 2009)

10 10 Environmental Compliance Process & Challenges DfE Manufacture Supply Chain Take-Back, Disposal, & compliance Design for Environment Compliant Processes Identify Categorize Treatment Reporting/ Analysis Site Inspection Material Compliance for RoHS Lead Free Compliant Identify Parts & Assemblies Substance data Waste Stream Disposal Confirmation Audit Design For RoHS RoHS Compliant Substance management Material Declaration (PCD) WEEE ELV (Vehicles) Non- Conformance Design For EuP REACH Compliant Birth Certificate (DoM) Ship to Restrictions Recovery Material Manifest Corrective Action Process Design For IPP Proof Of Compliance Country Specific Legislation Treatment Destruction Certificate Disposal Operations

11 11 DfE Design for Environment Think about material types: Use less harmful materials Use materials from sustainable sources Use materials from recycled sources Use materials which can be recycled

12 12 Who Is Responsible for Regulation Compliance? Everybody Amended RoHS Directive removes the term producer and replaces manufacturer, distributor, importer or authorised representative to be collectively known as economic operators. Unlike old RoHS, where generally only one of these operators would be defined as the producer, under the change, each of these operators will have obligations under the Directive. Just because IBM doesn t physically make equipment (OEM, ODM, black box) doesn t remove IBM s obligations to ensure whatever we import or distribute complies fully with the requirements of the legislation and is suitably documented and labeled. IBMs Environmental Due Diligence approach Focus on Records Product Content Declaration (PCD) Document Manufacture

13 13 New use for CE Conformity Mark Member states shall presume electrical and electronic equipment bearing the CE marking as conforming to this (RoHS ) Directive The CE Mark is a mandatory conformity symbol required for products sold in the European Economic Area. The CE mark indicates conformity to the legal requirements of the European Union (EU) Directive with respect to safety, health, environment, and consumer protection. By affixing the CE marking, the manufacturer, its authorized representatives, or any entity placing the product on the market asserts that the item meets all of the essential requirements of all the applicable EU Directives and that the applicable conformity assessment procedures have been applied correctly. All products offered for sale anywhere within the EU must have the mark or they cannot be sold. Each EU country inspects equipment and documentation to make sure that products conform as required. Any deviations from complete conformity will lead to sanctions such as warnings, sales bans, fines or even imprisonment. Source: Present EU recast draft - this recast is simply a proposal and is not yet in force. it is highly likely that the CE mark for RoHS compliance will be adopted early 2010

14 14 IBM Environmental Requirements IBM Engineering Specification (ES 46G3772) establishes baseline environmental requirements for all Deliverables where this specification is referenced in a Statement of Work, print, contract or other procurement document's. ES 46G3772 implements IBM's environmental policy objectives and contains some, but not all, environmental legal requirements for deliverables. Supplier shall ensure the Deliverables comply with all Environmental Laws and are ready for import, export, sale or other distribution of the Deliverable in all jurisdictions worldwide, regardless of where they are sold to IBM. IBM Global Procurement: Information for suppliers 03.ibm.com/procurement/proweb.nsf/contentdocsbytitle/united+sta tes~information+for+suppliers Baseline Environmental Requirements for Supplier Deliverables to IBM

15 15 IBM Environmental Requirements Environmental Laws include laws, rules and regulations at local, state, provincial, national or international level that relate to environmental matters, including without limitation material restrictions, material bans, labeling, availability of product environmental information, energy efficiency, end-of-life take back, battery requirements and other similar requirements. Full compliance requirements with the European Union (EU) Directive 2002/95/EC on the Restriction on the use of Certain Hazardous Substances in Electrical and Electronic Equipment (RoHS) are not part of ES 46G3772, but are rather applied through the combination of ES 46G3772, other applicable contract provisions and IBM engineering specifications, such as 53P6233 or 97P3864. In circumstances where multiple documents contain restrictions on the same chemical or substance in the same application, the most restrictive requirements apply. Baseline Environmental Requirements for Supplier Deliverables to IBM

16 16 REACH The overriding aim is to ensure that the most dangerous substances are replaced with safer alternatives. In effect, businesses must prove that substances that they produce or use are safe a change from the previous way chemicals were regulated which put the burden of proof on the authorities. All companies that produce or use chemicals are being given obligations under REACH. Manufacturers and importers must gather information on the properties of all substances that they produce or import in quantities greater than one tonne and register them in a central database. Users of chemicals must apply risk management measures for certain substances and provide information on how they use substances to their suppliers. Registration is to be staggered so chemicals are phased into the REACH system by The European Chemicals Agency, based in Helsinki, is the central authority dealing with the REACH system. Provisions are made for companies that produce or use the same chemicals to work together in consortium at national and EU levels, in order to reduce to the minimum the administrative and financial burdens on companies, particularly for SMEs. Source: EU s regulation on the Registration, Evaluation, Authorisation and Restriction of chemicals (REACH) website

17 17 Design for Environment (DfE) requirements & NGO s Toxic material restrictions also driven by NGO s Electronics manufacturers, standards bodies, and legislators have begun to take notice of the human health and environmental concerns associated with the use of brominated and chlorinated compounds in electronic products. An array of conflicting definitions and policies have emerged to address these concerns at various levels Environmental Working Group Published: September 2009 NGO's asking for clear timelines when industry will have halogen free equipment Source: NGO - Clean Production Action, an ETBC partner organization

18 18 Human health and Environmental Concerns Forms Dioxins When Incinerated (most potent cancer causing agents) PBB PBDEs PVC & DEHP/ BPP / DBP SCCP / MCCP *TBBPA HBCDD New Halogenated Substances REACH Switzerland Norway Canada Washington State Introduction Of Restrictions Annex 1V Ban + limits Prohibited above 0.1 % by weight EU Approved For Use In PCB s Introduction Of Restrictions Annex 1V Ban + limits? Previously Used - Banned Prohibited in IBM Deliverables In use Today Restricted Limits in IBM Deliverables Potential New Material IBM Voluntarily prohibited PBBs and PBDEs from use in products in 1993 Currently Regulatory Practice Every organo-halogen compound used in electronics can produce dioxins and furans, particularly during the end-of-life treatment of obsolete equipment. This chart shows just a few of the bromine- and chlorine-containing compounds used in electronics products manufactured over the past few decades. In addition to well-known BFRs (HBCDD, PBB, PBDEs, and TBBPA), the chart mentions some phthalates used with PVC plastic (BBP and DBP), as well as other persistent and bioaccumulative substances used in electronics production, such as chlorinated paraffins (SCCP and MCCP). PBT is the acronym for persistent bioaccumulative and toxic substances. The European Union has approved without restriction its use in circuit boards and plastics with no significant health concerns. *Largest BFR in terms of production. 70% used as a reacted flame retardant in electrical and electronic equipment and 20% used as an additive to plastics Based on ref. source: Clean Production Action, an ETBC partner organization

19 19 EU Recast Draft (3d) Regulation (EC) No 850/2004 of the European Parliament and of the Council of 29 April 2004 on persistent organic pollutants1 recalls that the objective of protecting the environment and human health from persistent organic pollutants cannot be sufficiently achieved by the Member States, owing to the transboundary effects of those pollutants, and can therefore be better achieved at Community level. Pursuant to that Regulation, releases of persistent organic pollutants, such as dioxins and furans, which are unintentional by-products of industrial processes, should be identified and reduced as soon as possible with the ultimate aim of elimination, where feasible. Thermal treatment or uncontrolled disposal of waste electrical and electronic equipment containing halogenated flame retardants or PVC can contribute significantly to the formation of dioxins and furans. The RoHS recast needs to be put into the context of the EU s international obligations to reduce total releases of dioxins and furans, with the goal of their continuing minimization and, where feasible, ultimate elimination. Emissions of dioxins and furans can only be addressed via material choices at design stage. Phasing out brominated and chlorinated flame retardants as well as PVC and its hazardous additives.

20 20 Status of IEC Test Standards: RoHS Testing New standard structure has been approved. The next version of IEC will split into separate horizontal standards by Substances for ease of standard development, maintenance, and adding new substances. Draw back: need to buy separate standards New name of standard: Determination of Certain Substances in Electrontechnical Products Goals are to turn PBBs/PBDEs and Cr(VI) (surface coating & polymer) from informative methods to a full test standard by 2012 New Work Item Proposals had been finalized and will be submitted for voting in Nov. International Round Robin Study 2H2010 Cr(VI) testing of surface coating: Harmonize the detection limit of Cr(VI) with EN15205, at 0.1 mg/cm^2 no objections thus far Pressure to provide guidance/risk assessment due to the uncertainty of coating weight determination proceeding with caution due to the potential implication Cr(VI) testing in Polymer: Progress on Extraction Efficiency by China and Korea Still working to understand how to overcome Matrix Interference issues Source: IEC TC111 WG3 - IEC Standard Meeting Report

21 21 News headlines Mac Pros accused of emitting toxic gas, placing blame on someone else Greenpeace slams HP, Lenovo, and Dell in latest report California Proposition 65 Greenpeace takes a break from issuing Reports to vandalize HP corporate HQ

22 22 IBM Volatile Organic Compound (VOC) Testing California Proposition 65, OSHA, ACGIH IPC Standard IPC-6012B Qualification and Performance Specification for Rigid Printed Boards Section Outgassing: The degree of outgassing shall have a Total Mass Loss (TML) of less than one percent (1%) and Collectible Volatile Condensable Material (CVCM) of less than one tenth of one percent (0.1%). Mass loss shall be determined on test coupons or production boards of representative substrates when tested in accordance with IPCTM-650, Method Example: Found in recent testing Epichlorohydrin Used in epoxy resins to offer corrosion resistance, solvent and chemical resistance, hardness and adhesion Recognized CA Prop 65 Carcinogen and Reproductive Toxicant

23 23 Source: inemi 2009 Technology Plan Board Assembly TIG April 03, 2009

24 24

25 25 New Green PCB Materials? Elimination of Halogenated Flame Retardants Flame Retardants in PCB Material (are required) Characteristics of Halogen-Free Laminates Processing Challenges of Halogen-Free Laminates Activities to develop Halogen-Free Laminate Reduction of Toxic Solvents Renewable Resin for PCBs

26 26 Renewable resins for PCBs Use of biopolymers to replace the oil-based epoxy resins Lignin. What is Lignin? The glue like substance found that ties the cellulose together in plants and trees Produced in large volume as a by-product of paper manufacturing Its molecular structure provides the thermal stability and chemical resistance necessary for PCBs. Experiments with epoxy resins with 50-percent lignin are proving to provide a PCB with equivalent or better thermal and electrical performance than current high-volume PCB's

27 27 Expect expanded and new legislative requirements The Nanotechnology Discussion Risk management Because nanotechnology would have such wide applications and so little was known about its potential effects, its risks could fall under a wide variety of existing lines, including environmental, product and professional liability, as well as workers' compensation, medical malpractice and directors' and officers' insurance, Dr. Blaunstein said. Source: The Royal Gazette on-line edition May 21, 2008

28 28 Summary It is inevitable that the transition to environmental compliance will have a significant impact on IBM Mission Critical Information Technology product Printed Circuit Boards and assembly as more BFR s and other SVHC materials are restricted. Capability & timeliness to comply with RoHS, WEEE, REACH and China and other worldwide environmental regulations now become key competitive differentiators in the industry.

29 29 Questions? Thank You

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