Carpet Industry Reality • • • 4.5 Billion pounds of carpet are sent to landfills annually – That’s 2% of annual US landfill volume. 20 years ago there were 18,000 public landfills that would accept carpet – today there are approximately 1,800 State landfill bans, advanced disposal fees, and likely RCRA 6002 CPG designation by Federal EPA in 2006. Annual US Landfill Volume (Actual and Projected) sq yds Solid waste is the single largest environmental impact made by the carpet industry. Transitional strategies like monofills and WTE will precede C2C. X 1000 = billions pounds Carpet Industry Environmental Footprint 1990 2002 2012 Landfill <5% CO2 Energy ~50% ~70% ~85% ~75% Water Waste 47% increase in yd2 produced 1990 to 2220 46% HAPS Paradigms of the Past • • • Cradle-to-grave production has been the carpet norm since introduction of tufting in the 1950’s. Shaw grew to industry dominance in 1980’s through efficiency and scale. We began reducing waste and recycling 60 different waste streams before it was considered “environmentally correct”. The industry was challenged in 1994 to move toward “sustainability”, but it has largely remained a marketing issue. Sustainable technologies are more talk than action. Establishing Cradle-to-Cradle Innovation at Shaw • Industry must see the business case for sustainability. Doing things right is not enough. • The commercial carpet industry was an early adopter of sustainability as a competitive issue. • Most carpet industry efforts were initially aimed at raw material and resource use reductions. Reducing waste had a positive financial effect. Shaw had already been doing these things since the mid-1980’s. • Carpet tile backing presented an opportunity for sustainable innovation due to PVC toxicity concerns and high backing weights of emulsion coating. • Metallecene polyolefin offered a pathway to a flexible backing that could be extruded at low weight without the use of plasticizers (1997 Scientific American article). Champions Are Key To Success • A partnership between Middle Management and Senior Management is critical to setting realistic goals and development budgets. Early successes are essential. • Senior Management funded EcoWorx backing development in two stages based on material formulations run on outside equipment that demonstrated the path forward at the same or lower price than PVC. • Design parameters were lower weight, equal cost and performance, sustainable recycling, and competitive advantage protected by IP. • By June 1999 we had perfected the EcoWorx formulation and developed marketing materials for its introduction at Neocon in Chicago. • EcoWorx won Most Innovative Product at Neocon, manufacturing management saw that the market perceived value. A Five Million Dollar Investment • • • • The biggest hurdle for the project was the 1996 construction of a 1 million sq. ft. carpet tile facility with state-of-the-art PVC backing capabilities. Shaw had the most stable PVC backing in the industry. Shaw spent $1 Million in the pilot phase on a single station extrusion line that produced first quality tile. Production of significant amounts of material for test installations was critical to further funding. Senior Management decided to fund an EcoWorx extrusion line with a capital cost of $5 Million based on early tile success and the promise of a single technology platform for tile and broadloom. Beyond the pressure on PVC, the magnitude of PC carpet and regulatory threat of landfill bans encouraged further development. We expected an exit from PVC in 6 to 8 years (and did it in 4 yrs). McDonough and Braungart Cradle to Cradle… • In 2000 we approached Bill and Michael to learn more about their work to apply it to our own with more rigor. • EcoWorx offered a truly recyclable material, but it took optimization under the MBDC Toxicity Protocol to achieve a true technical nutrient. • At this time Evergreen depolymerization was running and Shaw was taking over 50% of the output. EcoSolution Q nylon 6 was recoverable as a technical nutrient. All dyes, pigments, and auxiliaries were tested and optimized under MBDC. • Our work with Bill and Michael has provided clarity in our pursuit of sustainable solutions since that time. Reaching Out To A Cradle-to-Cradle Audience The William McDonough Design Portfolio reflects the sophisticated design interpretation of Bill’s photograph’s from China. It’s a statement that environmental excellence does not have to sacrifice cutting-edge design and color. Specifiers and owners have made the portfolio one of the fastest growing carpet tile offerings in the industry. Growth of EcoWorx Sales EcoWorx % of Shaw % of Industry 1999 42,000 sy .5% .1% 2000 723,000 sy 8.8% 2% 2001 2,516,000 sy 30.5% 6% 2002 3,159,000 sy 39.6% 7.7% 2003 4,584,000 sy 53.8% 10.7% 2004 7,890,000 sy 77.5% 19% 2005 (est.) 11,040,000 sy 91% 23% Shaw exited PVC carpet tile production at the end of 2004, 4 years after introduction. EcoWorx was responsible for annual double-digit tile growth since 2001. About 9% of 2005 tile sales will be produced with the EcoLogix PET cushion tile backing. EcoWorx Environmental Guarantee Every square yard of EcoWorx carpet tile is sold with an environmental guarantee. A toll-free number is imprinted on the back of every tile. Shaw will transport and recycle its EcoWorx carpet tiles at the end of the useful life of the installation, at Shaw expense, back into more EcoWorx tile of the same quality. No EcoWorx backing need ever go to a landfill if the occupier will call this number at the time of uplift, regardless of who originally purchased the tile and regardless of what product may be replacing the tile. Elutriation of Eco/Eco • Grinding and air classification of backing and fiber streams • Current capacity of 3.75 million sy annually. Current return rate of 50,000 sy annually. • 2005 production est. of 11 million sy. Current elutriation capacity should suffice through 2010. • EcoWorx stream is immediately returned EcoWorx production. • Nylon 6 materials pooling agreement with BASF Arnprior not yet utilized. Additional Waste Streams • Recent addition of post-industrial filler from EVA automotive sound insulation. Replaces 5% to 20% of polymer weight without loss of performance or recyclability. • Polyethylene stretch film can also be pelletized and used to reduce virgin polymer weight. Fillers necessary in order to maintain sufficient mass and backstitch coverage. • Current EVA latex precoat is now being converted to an EVA hotmelt formulation that will boost thermoplastic content and give higher wet/dry strength. • EcoWorx was designed to be a robust low-melt polymer platform. This lowers cost and increases recycled content sources. Focus is on noncarpet sources, but much more needs to be done to identify and evaluate opportunities. The Philosophy Behind Shaw’s Vision of A Cradleto-Cradle Future ‘Cradle-to-Grave’ Production Take Raw material extraction and synthesis Make Waste Manufacturing, production, distribution, use Landfill, incineration ‘Cradle-to-Grave’ Production It would require four more planets the size of earth for every person in the world to reach present US levels of consumption. Resource consumption in China, India, and other rapidly industrializing nations in the global economy is already affecting capacities and pricing. Thermoplastics vs. Thermosets Thermoplastic polymer chemistry allows products to be sustainably recycled. Thermosets are difficult to separate into their original components. EcoWorx embodies intelligent design for disassembly. Sustainable carpets must evolve beyond the use of inexpensive thermosets like SBR latex. Sustainability Must Be A Standard Business Practice The “traditional environmentalist” response is an unacceptable solution to industry goals of growth and profitability. Cradle-to-Cradle Design offers the only demonstrated path to a sustainable future. Take Less Make Less Waste Less Environmental Influences Shaw had a desire to go beyond simple recycling and the goal of zero waste with sustainable technologies that could become strategic to operational excellence and profit improvement. We chose to treat sustainability as an extension of quality and drive it with a management system approach. Cradle To Cradle Metabolisms Biological Metabolism Biological Nutrients Products of Consumption Technical Metabolism Technical Nutrients Products of Service EcoWorx and EcoSolution Q conform to the concept of technical metabolism as described by McDonough and Braungart. Both metabolisms are valid pathways to a C2C future. Shaw Adapts Cradle-to-Cradle Principles Cradl eto Cradl e Shaw has adapted Cradle-to-Cradle concepts to describe a future where our carpets are made of technical nutrients that are safe for humans and the environment, make intelligent use of nonrenewable energy, and are returned to sustainable manufacturing through recycling infrastructure. Safe and Healthy Materials • By what toxicity measure? MBDC Chemical Protocol testing of EcoWorx, Eco Solution Q, and all additives and colorants, tested to 100 ppm level in supply chain. • Consensus standards CRI seeking Unified Carpet Standard as a voluntary, consensus, LCA-based approach. Open to 3rd party and self-certification. • Thermoplastics vs. thermosets Recycling of thermoplastics must be weighed against the low cost and high performance of traditional thermosets. Infrastructure of collection must channel thermosets into non-carpet recycled uses. (NyBoard, LA Fibers, Remlon automotive nylon). Safety is boring. Until the 30-foot waves start to hit. EcoWorx and EcoSolution Q were assessed and optimized under the MBDC Toxicity Protocol. Shaw will continue to utilize the protocol for product development. Coal Fly Ash Toxicity Profile Parameter TCLP TCLP TCLP TCLP TCLP TCLP TCLP TCLP Arsenic Barium Cadmium Chromium Lead Mercury Selenium Silver Hazardous Limit (mg/L) PV 14A PV 20A 5 100 1 5 5 0.2 1 5 <0.10 2.13 <0.05 <0.10 <0.10 <0.002 <0.10 <0.50 <0.10 2.50 <0.05 <0.10 <0.10 <0.002 <0.10 <0.50 Source: Georgia Power Plant Robins Macon, GA Energy Reduction • By what energy measure? No adequate embodied energy protocol as yet as an analog to MBDC Toxicity. LCA calculation methods used to validate move from PVC. Matching supply chain speciation down to 100 ppm may be difficult in practice. • Role of Life Cycle Analysis Sustainable attributes must be optimized through good science. Shaw EcoWorx vs. Shaw PVC study 2005. • Linking Mass and Energy We have no additional future mass income. Material is the focus today. The sun may provide ample future energy income. The Promise of Solar Energy • True C2C anticipates a solar future that relies on the current solar income of the earth. • Adapted C2C recognizes the need to continuously reduce the fossil reliance of today’s economy and make intelligent decisions about its use. • As part of Berkshire Hathaway, Shaw’s vertical integration plan does not include energy demonstration technologies at present. Berkshire’s MidAmerican Energy is planning the largest wind farm project in the US –a 310 megawatt project that will power the equivalent of 330,000 homes each year. Transitional Strategies Shaw Waste to Steam Facility 90% of all landfilled carpet is a cleaner fuel source than coal “Carpet Derived Fuel” Shaw Gasifier Shaw Gasifier Facts • Transitional strategy to divert carpet from landfill. • Replaces old boilers that burned coal and #6 fuel oil. • • • 16,000 tons/yr of carpet derived fuel and 6000 tons/yr of wood flour from laminate operations will be converted to synthetic gas. Steam production only. No power generation. Reduced emissions for Plant 81. Carpet contains no heavy metals like mercury. Value Recovery • By what measures? Can we recover carpets for recycling in ways that are economicly, ecologically and socially sustaining? Includes use of LCA and Environmental Management and Cost Systems. • Economies of Scale Drivers of collection infrastructure must be diverse and adaptive. WTE is a transitional technology that diverts mass from landfills. Higher value use of waste is the objective. C2C recycling may not yield the lowest LCA impact, but technology can change that. • Competition or Cooperation? Alone, together, or with CARE? Eco/Eco products promise EOL recovery. Elutriation is in place, but volume low until 2007-2009. Restart or further development of nylon recycling is critical to success. Material pooling will be difficult until thermoplastics become more widespread in carpet. Cradle to Cradle is a beautiful thing even to a bean counter… …if it’s profitable. $ EcoWorx Backing Development • • • • • Alternative to PVC Cradle to cradle recycling 30% lighter weight than PVC 40% recycled content Environmental guarantee (e.g.) Chemical Input Composition of EcoWorx and Permabac Process Materials name Dyed nylon fiber Polyester (PET) LDPE HDPE Fly ash Latex Other additives Jayflex 77 plasticizer PVC resin Calcium carbonate Total ECOWORX Mass, kg/sy Composition 0.57 0.11 0.3402 0.06 0.85 0.51 0.59 18.7% 3.7% 11.2% 1.9% 28.1% 16.9% 19.4% 3.03 100% Mass, kg/sy PERMABAC Composition 0.57 0.11 0.74 0.13 0.535635889 0.429041683 1.96 4.47 12.7% 2.5% 16.5% 2.9% 12.0% 9.6% 43.8% 100% List of additives in Permabac Carpet Tile Chemical name CAS no. Sb2O3 Antimony trioxide ammonia carbon black Anionic surfactant Anionic Surface modifier Hydrous Aluminum Silicate sodium polyacrylate copolymer solution Stainblocker1 Stainblocker2 n-Paraffinic Hydrocarbon Sodium Dodecylbenzenesulfonate Soy phospholipids Calcium oxide methylenebisthiocyanate Sodium Polyacrylate PVC stabilizer Fluorochemical zinc pyridinethione C10H8N2O2S2Zn 1309-64-4 7664-41-7 1333-86-4 1332-58-7 25987-30-8 64771-72-8 251-55-300 8002-43-5 1305-78-8 6317-18-6 9003--04--7 13463-41-7 List of additives of EcoWorx Carpet Tile Chemical Name Anionic Surface modifier methylenebisthiocyanate proplene glycol Anionic surfactant Hexamethylphosphoramide Ethylene/octene copolymer w/maleic anhydride parrafinic oil Sodium Dodecylbenzenesulfonate Stainblocker 1 Stainblocker 2 Fluorochemical Cas. No. 6317-18-6 57-55-6 680-31-9 085244-45-7 251-55-300 Comparison of Permabac PVC and EcoWorx Dyed nylon fiber PET Mass, kg/sy .. Fiber glass 4.50 Diisoheptyl phthalate 4.00 Ethene, chloro-homopolymer, 3.50 Ethylene-vinyl Acetate Copolymer 3.00 poly(Ethylacrylate-co-vinyl chloride) 2.50 2.00 Proprietary carboxylated butadiene/acrylate polymer Hydrocarbon resin 1.50 Al(OH)3 1.00 LDPE 0.50 CaCO3 or fly ash 0.00 PERMABAC ECOWORX Additives CRADLE-TO-GATE ENERGY COMPARISON for EcoWorx and Permabac Tile ECOWORX Ctg energy, MJ/kg Mass, kg/sy Carpet supply chain, MJ/sy LDPE & HDPE 19 .34 6.6 Flyash 0 0.85 0 Total, approximate 6.6 EcoWorx process, gtg 8.7 Total, MJ/sy 15.3 PERMABAC PVC & plasticizer CaCO3 34 0.97 33 0.18 1.96 .35 Total, approximate 33.4 Permabac process, gtg 9.8 43.2 ECOWORX and PERMABAC Process Energy Comparison ECOWORX energy, kJ/sy Electricity Heating steam Direct fuel Energy requirement Generation efficiency from natural fuel. ECOWORX natural fuel energy, kJ/sy PERMABAC energy, kJ/sy PERMABAC natural fuel energy, kJ/sy 3620 0.32 11300 1380 4320 1400 0.85 1650 1560 1830 3670 1.00 3670 7000 7000 16600 9910 13100 8690 In conclusion, at the carpet manufacturing plant (gtg level) the two carpet systems differ by a small amount in energy consumption. The higher energy use for EcoWorx has been directly related to the physical/chemical properties of the principal ingredients. However, this comparison has only a slight dependency on carpet weight. Benefits of Sustainable Redesign Permabac PVC • • • • • • • • • • • • • • Chlorinated PVC concerns Phthalate plasticizer concerns Heavy PVC coating for stability Limestone filler Antimony trioxide flame retardant (patent restriction) Nylon contamination Extrusion corrosion concerns Smoke density <450 4000 sy per trailer load 18” x 18” standard High radiant heat processing EOL material value uncertain Too heavy for broadloom use Higher incidence of installer injury EcoWorx polyolefin • • • • • • • • • • • • • • Food-grade polyolefin Flexibilized by polyethylene 30% - 40% lighter weight Safe coal fly ash filler Aluminum trihydrate flame retardant Nylon recovery not affected Lower capital cost Smoke density <200 7000 sy per trailer load, lower cost 24” x 24” standard 30% less process energy Positive EOL value High potential for broadloom use Better ergonomics, fewer accidents EcoSolution Q and Fiber Production at Shaw Eco Solution Q® premium branded commercial nylon • 25% post-industrial recycled content in every pound • Full warranty program • Dedicated toll-free customer service line Comparison Of Nylon 6 & Nylon 6,6 (Ctg) Cradle-to-Gate supply chain energy from published studies Source Nylon 6, MJ/kg Nylon 6,6, MJ/kg Difference, % Boustead (Europe) 93 81 15 DOE - OIT 76 65 17 LCI energy data from nylon 6 depolymerization is unavailable, but it is unlikely that the process energy of depolymerization would exceed the virgin supply chain energy. There is no demonstrated commercialized process for recovery of white nylon 6,6. LCI estimates that make a claim of nylon service life of 30 years ignore the fact that the average commercial replacement cycle of 7 years has not changed significantly in the last 20 years. Shaw Fibers • Among the largest carpet fiber producers in the world • Over 600 million lbs. of carpet fiber per year produced • 8 manufacturing plant locations in the Southeast • Nylon 6, Polypropylene, Polyester, and PTT • The most fully integrated carpet fiber producer • From Cyclohexane base raw material to finished nylon 6 carpet fiber • Produce custom colorants for solution dye fiber in one of the largest color resin plants in North America • • • • • • • • • 1994 1997 1999 1999 1999 2002 2003 2003 2004 Began redesign of carpet tile EcoSolution Q Introduction EcoWorx Introduction Best of NeoCon Governor’s Pollution Prevention EcoWorx exceeds PVC production Third Party Certification - MBDC EPA Presidential Green Chemistry Shaw exits PVC 2004 Impact Reductions • • 20 million lbs of post-industrial nylon 6 recycled. 29 million lbs of post-industrial waste recycled into carpet yarn of all types. • 16 million lbs of post–industrial coal fly ash recycled. • 15 million lbs of post-industrial waste recycled into fiber pad. • • Post-consumer PET green drink bottles recycled into Ecologic cushion. Shaw exited PVC in favor of EcoWorx polyolefin thermoplastic extruded backing. Recycling of Eco/Eco Products Recycle Content Projection Recycle Process Efficiency EcoWorx Backing 50% 30% Recovered Tiles End-of- Life Tile 50% Discarded Tiles Projected 25% of new backing will be manufactured using old tile based of 50% recovery rate and current 30% process efficiency. Next Generation EcoWorx Backing Recycling Flow Diagram End-of-Life Ecoworx Tile Depolymerization to Caprolactam Polmerization & Spinning Transportation 4 MJ/sq yd 75% Purity 2.47 kg/sq yd Nylon Nylon Face Fiber 23% Waste 47% Size Reduction & Separation 1.14 MJ/sq yd 2.686 kg/sq yd 30% Backing Material Next Generation of Ecoworx Tile Ecoworx Backing 25% 75% Energy assigned to nylon and backing material Virgin Backing Material Elutriation Energy Calculations 2.25 MJ/sq yd Backing 4.0 MJ/sq yd 1.75 MJ/sq yd Nylon Fraction 2.89 MJ/ sq yd Backing 0.64 MJ/sq yd Backing 1.14 MJ/ sq yd 0.5 MJ/sq yd Nylon Fraction 2.89 MJ/ sq yd vs. 6.6 MJ/ sq yd for Virgin EcoWorx material 56% Energy saving for recycled backing material Effect of Tile Recovery 2.89 MJ/ sq yd Recycle Backing 6.6 MJ/ sq yd Virgin Backing 25% 75% 5.67 MJ/sq yd Next Generation Backing 14% Energy Saving • Raising the Recycle Content of the backing is ONLY possible if collection and elutriation is more efficient. • At 100% tile recovery the recycle content is at a maximum of 50% on a sustainable basis for 30% Overall Energy Saving. Percentage Eco/Eco Recycling Energy Efficiency 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 1 2 3 4 5 6 Ecoworx Generation % Total Energy Used % of Tiles Recovered Accumulated energy per yard square (kJ/yrd2) Accumulated Energy Usage in Eco/Eco 200000 150000 100000 50000 0 0 1 2 3 4 5 6 7 Generation Recycled Material Energy Accumulation 100% Virgin Material Energy Accumulation Corporate Environmental Efforts at Shaw Corporate Environmental • • • Created in September 2004 in recognition of the strategic importance of environmental issues. Paired with Corporate Quality (ISO9001/SQS) due to the need for an environmental management system (ISO14001/SES). “Environment” is the new “Quality”. Another way to operational excellence and profit improvement. Environmental Management System • • • • Shaw Environmental System (SES) ISO 14001 based Takes advantage of the ISO 9000 based Shaw Quality System (SQS) driven by Six Sigma. Continuing development of Environmental Cost System to define the environmental and social aspects of business. Internally focused to drive innovation by making environmental improvement a standard Shaw business practice. Integrating Our Quality and Environmental Systems SQS (ISO 9001) Unique Customer Focus Product Realization Design and Development Production and Service Customer Satisfaction Control of NCP SES Shared (ISO 14001) Unique Policy Manual and Statement Document Control Objectives and Targets Training Internal Auditing Measuring and Monitoring Calibration CA/PA Systems Management Review Aspects and Impacts Emergency Response Interested Parties Regulatory Compliance SES Update: Shaw Environmental System • • • • SES is data-driven through a formal management system structure, but it is also a price of admission for credibility in sustainability claims. All seven pilot facilities on-schedule for July 2005 certification. All remaining plants prioritized and scheduled for certification by end 2006. SES will include an environmental measurement system appropriate to each facility, but common corporate measurements will be summarized. Key Corporate Aspects: What to measure? • • • • Solid Waste, Energy, and Water Basic goals: Identification, benchmarking, and reduction of impacts. Selection criteria: Highly significant, highly achievable, and highly aggressive. Tracking the scope and pace of technology development is also critical. Environmental Research Interviews and Survey • • • • A Shaw internal awareness and attitudes survey will establish a baseline for annual measurement. Pride Day completion of 48 F2F interviews to help in designing an effective annual survey. Survey will go to 3000 Shaw respondents, hourly and salaried, in an on-line survey in May. Objective is to help define Shaw’s environmental identity and create messaging for internal and external audiences. Environmental Research Employee F2F Interview Findings • • • Environmental Awareness • • • • • Low level of knowledge and awareness 27% could not name any impacts from Shaw processes 37% believe we have effective ways to measure impacts now 21% believe carpet is toxic 58% believe carpet is sustainable now Environmental Attitudes • • • • 87% believe stewardship is important at work and home 50% are pessimistic about the future of the environment 73% are enthusiastic about Shaw initiatives and want to be involved 15% feel sustainability is a waste of time Opinions About Shaw • • • • Overwhelmingly positive (80%+) Only 68% view Shaw as an environmental leader Only 75% said Shaw products are totally safe and healthy Only 70% feel Shaw is adequately involved in their community Question everything. Make honest assessments. Change. “ Shaw Industries recognizes that merely preserving and conserving the natural bounty of the earth will not make us a sustainable corporation. A truly sustainable carpet industry must mimic nature's organic cycle of life, death, and rebirth. The answer does not lie in limiting growth, but in encouraging the kind of growth that is cradle-to-cradle, returning carpet to carpet endlessly. Toward that end, Shaw has adopted these productive policies and practices.” R.E. Shaw CEO Shaw Environmental Vision • • • • • • Environmental sustainability is our destination and cradle-to-cradle is our path. Our entire corporation and all stakeholders will value and share this vision. Through eco-effective technology we will continuously redesign our products, our processes, and our corporation. We will take responsibility for all that we do and strive to return our products to technical nutrient cycles that virtually eliminate the concept of waste. We will plan for generations, while accepting the urgency of the present. We are committed to the communities where we live and work. Our resources, health, and diversity will not be compromised. We look forward to a solar-powered future utilizing the current solar income of the earth, anticipating declining solar costs and rising fossil fuel costs as technology and resource depletion accelerate. We will lead our industry in developing and delivering profitable cradle-to-cradle solutions to our free-market economy. Economy, equity, and ecology will be continually optimized. “Any jackass can kick down a barn, but it takes a good carpenter to build one .” - Sam Rayburn