THE INDUSTRIAL GREEN GAME

IMPLICATIONS FOR ENVIRONMENTAL DESIGN AND MANAGEMENT

Edited by

DEANNA J. RICHARDS

NATIONAL ACADEMY OF ENGINEERING

NATIONAL ACADEMY PRESS
Washington, D.C.
1997



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The Industrial Green Game: Implications for Environmental Design and Management THE INDUSTRIAL GREEN GAME IMPLICATIONS FOR ENVIRONMENTAL DESIGN AND MANAGEMENT Edited by DEANNA J. RICHARDS NATIONAL ACADEMY OF ENGINEERING NATIONAL ACADEMY PRESS Washington, D.C. 1997

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The Industrial Green Game: Implications for Environmental Design and Management NATIONAL ACADEMY PRESS 2101 Constitution Avenue, NW Washington, DC 20418 The National Academy of Engineering was established in 1964 under the charter of the National Academy of Sciences as a parallel organization of outstanding engineers. It is autonomous in its administration and in the selection of its members, sharing with the National Academy of Sciences the responsibility for advising the federal government. The National Academy of Engineering also sponsors engineering programs aimed at meeting national needs, encourages education and research, and recognizes the superior achievements of engineers. Wm. A. Wulf is president of the National Academy of Engineering. This volume has been reviewed by a group other than the authors according to procedures approved by a National Academy of Engineering report review process. The interpretations and conclusions expressed in the papers are those of the authors and are not presented as the views of the council, officers, or staff of the National Academy of Engineering. Funding for this project was provided by the AT&T Foundation, the Ralph M. Parsons Foundation, the Andrew W. Mellon Foundation, and the National Academy of Engineering Technology Agenda Program. Library of Congress Cataloging-in-Publication Data The Industrial green game : implications for environmental design and management / edited by Deanna J. Richards. p. cm. Includes bibliographical references and index. ISBN 0-309-05294-7 (alk. paper) 1. Industrial ecology. 2. Manufacturers—Environmental aspects. I. Richards, Deanna J. TS161.I544 1997 658.4'08–dc21 96-40095 CIP Copyright 1997 by the National Academy of Sciences. All rights reserved. Cover art: Khalo's Garden (detail), courtesy of the artist, Alfredo Arreguin, Seattle, Wash. Printed in the United States of America

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The Industrial Green Game: Implications for Environmental Design and Management Steering Committee ROBERT A. FROSCH (Chairman), Senior Research Fellow, Harvard University (Former Vice President for Research, General Motors) PETER R. BRIDENBAUGH, Executive Vice President, Automotive Aluminum Company of America ROBERT C. FORNEY, Retired Executive Vice President, E.I. du Pont de Nemours & Company G. FRANK JOKLIK, Retired President and CEO, Kennecott Corporation ROBERT A. LAUDISE, Director, Materials and Processing Research Laboratory, Lucent Technology LEE THOMAS, SR., Vice President, Environmental Government Affairs, Georgia-Pacific Corporation KURT YEAGER, President, Electric Power Research Institute Staff DEANNA J. RICHARDS, Project Director GREG PEARSON, Editor MARION RAMSEY, Senior Program Assistant

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The Industrial Green Game: Implications for Environmental Design and Management This page in the original is blank.

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The Industrial Green Game: Implications for Environmental Design and Management Preface The mainstreaming of environmental considerations in design and management decisions by companies as well as public-sector organizations is a relatively new phenomenon. The National Academy of Engineering (NAE), through its program on Technology and Environment has, since the late 1980s, taken a "best practices" approach to articulating emerging concepts that aid the mainstreaming process. This volume describes practices that are being used by a variety of industries in several industrialized countries to integrate environmental considerations in decision making. Environmental issues facing corporations (and public agencies that regulate their actions) vary dramatically. How these issues are incorporated into decision making depends on the type of business; level and sophistication of corporate use of technology and information; employees' knowledge, management skills, and ingenuity; and the design and execution of a plan of action. Those firms that are farther along in making "green" products, using "clean" production, or delivering ''green" services face difficult choices as they strive to improve environmental performance. But, as this volume suggests, learning and application of usable knowledge leads to continuous improvement. The papers in this report were presented originally as part of an international conference on industrial ecology convened by the NAE in May 1994. Collectively, they describe concepts and present case studies and tools that contribute to the improvement of environmental quality. Many individuals were involved in the preparation of this volume. On behalf of the National Academy of Engineering, I want to thank particularly the authors for their thoughtful contributions and the members of the conference steering committee—Peter R. Bridenbaugh, Robert Forney, Robert A. Frosch (chairman),

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The Industrial Green Game: Implications for Environmental Design and Management Frank Joklik, Robert Laudise, Lee Thomas, and Kurt Yeager—for their help in organizing the conference. I would also like to thank the NAE staff who worked on this project. Deanna Richards, who directs the NAE Technology and Environment Program, was primarily responsible for sheparding the project through its various stages. Peter Schulze, NAE J. Herbert Holloman Fellow, contributed valuable assistance along the way; Marion Ramsey, senior program assistant, provided critical administrative, logistical, and editorial support; Greg Pearson, the Academy's editor, contributed invaluable and steadfast editing and publishing oversight of this document. And Bruce Guile, former director of the NAE Program Office, gave advice and assistance throughout the project. Finally, I would like to express my appreciation to the AT&T Foundation and the Ralph M. Parsons Foundation for their partial support of this project and to the Andrew W. Mellon Foundation for its partial support of related elements of the Academy's Technology and Environment Program. WM. A. WULF President National Academy of Engineering

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The Industrial Green Game: Implications for Environmental Design and Management Contents     The Industrial Green Game: Overview and Perspectives Deanna J. Richards and Robert A. Frosch   1 CONCEPTS         Industrial Ecology: Closing the Loop on Waste Materials Robert A. Frosch   37     Metrics, Systems, and Technological Choices David Rejeski   48     Energetics Concepts Drawn from Electricity Production and Consumption Glyn England and David R. Cope   73     The Functional Economy: Cultural and Organizational Change Walter R. Stahel   91     Environmental Constraints and the Evolution of the Private Firm Braden R. Allenby   101 EXAMPLES OF ENVIRONMENTAL DESIGN AND MANAGEMENT         The Industrial Symbiosis at Kalundborg, Denmark Henning Grann   117     Environmental Prioritization Inge Horkeby   124

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The Industrial Green Game: Implications for Environmental Design and Management     Improving Environmental Performance Through Effective Measurement Brian L. Steelman, James Hall, C. Peter Naish, and Antonio Mazzariello   132     Hydro Aluminum's Experience with Industrial Ecology Rolf Marstrander   148     Europipe Development Project: Managing a Pipeline Project in a Complex and Sensitive Environment Henning Grann   154     Environmental Strategies in the Mining Industry: One Company's Experience Preston S. Chiaro   165 Some Analytical Tools         Accounting for Environmental Cost Richard Macve   185     Public Perception, Understanding, and Values M. Granger Morgan   200     Consumer Perceptions of Environmentalism in the Triad Françoise Simon and Mary Woodell   212     A Critique of Life Cycle Analysis: Paper Products Robert Johnston   225     Japan's Changing Environmental Policy, Government Initiatives, and Industry Responses Sukehiro Gotoh   234 Biographical Data   253 Index   259

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The Industrial Green Game: Implications for Environmental Design and Management THE INDUSTRIAL GREEN GAME

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