The VDI 2343 Guideline Gives Recommendations For The Concerned Parties Part ReUse

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1 The VDI 2343 Guideline Gives Recommendations For The Concerned Parties Part ReUse R. Brüning B. Rosemann Dr. Brüning Engineering, Brake, Deutschland Universität Bayreuth, Bayreuth, Deutschland B. Enderle K. Schmidt, T.S. Spengler Allen & Overy LLP, Frankfurt, Deutschland TU Braunschweig, AIP, Braunschweig, Deutschland M. Plumeyer Siemens AG Healthcare Refurbished Systems, Forchheim, Deutschland Abstract Germany implemented the European WEEE [18] and RoHS [12] Directives with the German Act on Electrical and Electronic Equipment (ElektroG) [6] in 2005 and In order to support the concerned parties in their work, the VDI guideline committee recycling of electric and electronic devices - was established. The objective of Guideline VDI 2343 is to elaborate and compile practice-tailored and state of the art recommendations for the parties concerned. This is on the one hand because of requirements of the ElektroG, the German implementation of European legislation. On the other hand, ReUse, often also named as remanufacturing - the ultimate form of recycling [14] - promises big economical and ecological benefits. Nevertheless, remanufacturing of electronic and electric devices is - in contrast to the automotive applications - less practiced [13]. Therefore, the sheet covers different matters of remanufacturing in order to support small and medium enterprises in establishing remanufacturing activities properly. The sheet starts from the technological point of view, then focussing on economic, ecologic, legal and social objectives. With the intention of further deploying remanufacturing and reuse, recommendations for remanufacturing and refurbishing of electronic and electric devices are given. Their objective is to depict, under which conditions recycling or reuse of electric or electronic products and components is recommended. 1 FACTS ABOUT THE VDI AND VDI GUIDELINES [15] The Verein Deutscher Ingenieure e. V. ( The Association of German Engineers ) is a charitable, commercially and politically independent technical and scientific association of engineers and scientists. With more than 135,000 members, it is one of the largest associations of engineers in Europe and the leading spokesman for technology and engineering in Germany (VDI, 2009). Established in 1856, it has initiated many major developments for technology, for instance in the area of technical monitoring, technical regulations and standardization, working studies, industrial right protection and patent matters. The VDI has systematically built up a set of technical regulations, which today contains more than 1,700 valid VDI guidelines covering extensively the broad field of technology. In line with technical developments, the existing guidelines are updated regularly. Each year about 190 new VDI guidelines are published. This enables the VDI to fulfill its primary function: the transfer of technical knowledge as a service. VDI guidelines are leading working documents for daily use. With regard to their assessment and evaluation criteria they provide well-founded bases for decision taking processes and represent benchmarks for unobjectionable technical procedures. VDI guidelines provide engineers in practice with the security to comply with approved technical regulations. VDI guidelines have particular legal importance at the national level, for example by their inclusion in acts, ordinances, decrees or regulations. VDI guidelines also constitute a practical supplement to European and international rules or serve as national position during the development of these regulations.

2 2 GUIDELINE VDI 2343 PART REUSE To support the players in the ReUse market the guideline addresses the following aspects: Legal aspects; Technical aspects; and Economical, ecological and social aspects. 3 LEGAL FRAMEWORK FOR REUSE [11] The legal framework for ReUse is mainly laid down in the public law provisions of the Waste Management Act (Kreislaufwirtschafts- und Abfallgesetz, "KrW-/AbfG") and the Electrical and Electronic Equipment Act (Elektro- und Elektronikgerätegesetz, "ElektroG"). In addition, Civil and Criminal Law impose certain legal obligations relating to ReUse, which will not be focused in the following. Moreover, particular reference is made to the shipment of waste electrical and electronic equipment (WEEE) which is relevant in the context of ReUse on the international level. The current version of the ElektroG only addresses the ReUse of electrical and electronic equipment (EEE) and components that already have become waste. However, the new Waste Framework Directive (2008/98/EC, "WFD") [19] which entered into force on 12 December 2008 as well as the current proposal for the new WEEE-Directive (Doc. COM [2008] 810 of 3 December 2008) provide for a distinction between the terms "ReUse" and "Preparing for ReUse". In order to facilitate the handling of this terminology in practice the VDI guideline 2343 recommends to introduce the terms ReUse I and ReUse II. The WFD defines "ReUse" as any operation by which products or components that are not waste are used again for the same purpose for which they were conceived (corresponding to ReUse I). Whereas the term "Preparing for ReUse" means checking, cleaning or repairing recovery operations, by which products or components of products that have become waste are prepared so that they can be reused without any other pre-processing (corresponding to ReUse II). Pursuant to the current draft legislation the terminology of the WFD will be implemented in largely identical wording in the new KrW-/AbfG (then renamed as Kreislaufwirtschaftsgesetz), which will not enter into force before On the European level, the legislative process for the recast of the WEEE-Directive has not yet been concluded. The entry into force of the recast is also not expected before The ElektroG will thereafter be amended accordingly. In any case, the revision of the national WEEE legislations will lead to a further promotion of ReUse, additionally supported by the new waste hierarchy giving priority for ReUse II over all other forms of recovery (see Figure 1).

3 EU Waste hierarchy Waste property Explanation regarding reuse Proposed nomenclature of term ReUse Addressed in German Fed. Law prevention no waste (subst./mat./product) using directly again; same purpose as before ReUse I no preparing for reuse preparing for further use ReUse II yes recycling waste other recovery disposal 1 (WFD, 2008) 2 (ElektroG, 2005) Figure 1: Waste hierarchy, scopes and proposed terms ReUse I and ReUse II ReUse (II) is already one of the objectives of the ElektroG in order to implement an integrated waste management in Germany: "The ElektroG aims primarily at preventing waste from EEE and further at promoting reuse, recycling and other forms of recovery to reduce both, the volume of waste for disposal and the inclusion in waste of harmful substances from WEEE". The ElektroG provides for four core obligations relating to ReUse. (1) The Design Obligations: EEE must, wherever possible, be designed in a way providing for and facilitating their ReUse as such or of their components or materials. The producers are further obliged not to prevent ReUse through specific design features or certain manufacturing processes unless such features or processes are required by law or present overriding advantages [11]. (2) Safe Take-back Obligations: The ElektroG also obliges public waste management authorities, distributors and producers to collect and take back WEEE in a way that does not prevent their subsequent ReUse, i.e. without further damages [11]. (3) The ReUse-check Obligations: The waste treatment facilities must check prior to the disposal or treatment of the waste whether the WEEE or its components can be reused provided that such check is technically and financially feasible. The latter will significantly depend on the information made available to the operators of treatment facilities by the producers [11]. (4) The Reporting Obligations: Finally, the registered producers have to inform the German Clearing House (Stiftung Elektro-Altgeräte-Register) about the number of devices that have been reused in order to enable the Clearing House to monitor the waste stream and attainment of the recycling quota [11]. Transnational shipments of (W)EEE are in particular subject to controversy. Whereas the shipment of used EEE (products) for ReUse purposes is admissible, the shipment of WEEE (regularly hazardous wastes) from the EU to non-oecd member states (mostly developing countries), in general, is not. The distinction between WEEE, the shipment of which is subject to Regulation 1013/2006/EC, and EEE poses a difficult challenge on the international level. In order to facilitate the enforcement practice of the Member State authorities (in particular customs authorities) Annex I of the proposal for the new WEEE- Directive provides for minimum monitoring requirements for shipments of WEEE. In cases

4 in which the holder of an object claims to ship used EEE and not WEEE, he must provide evidence for such claim to the authorities (e.g. the sales contract indicating that the EEE is intended for direct ReUse, documentation on the functionality of the EEE, sufficient packaging for a safe transport). If sufficient evidence is not provided, Member State authorities shall presume that an item is hazardous WEEE and that the load is an illegal shipment of waste entailing the pertinent consequences for the responsible person (take back obligations and where applicable criminal sanctions). 4 TECHNICAL PROCESSES FOR REUSE ReUse describes in a closed view the technical oriented processes prior to distribution and reapplication of (W)EEE. It serves the maintaining or reconditioning of the product function and quality. It aims carrying used products over to use the whole product or components again and to extend their functional and economic life. ReUse covers the necessary process steps, which are appropriate to distribute old appliances or their components again by considering different requirements like quality, reliability and safety. Usually ReUse is carried out in five basic process steps disassembly, diagnostic, cleaning, reconditioning and/or replenishment and product assembly [14]. In specific cases further steps or special operations may be required, e.g. for medical equipment it is necessary to do a de-contamination process. During the ReUse process usually only the wearing parts are reconditioned or replaced whereas the high value components can be reused. Thereby it can be ensured that reused products have a comparable quality to newly manufactured products. Referring to scientific Studies several kinds of ReUse, differing mainly regarding to the quality level of the reused product can be distinguished (see Figure 2). characteristic disassembly level quality level product change Direct Use product or component used same as before repairing product able to work parts changed or repaired Cannibalization component depending from further use parts partly reused Refurbishing product or component specified quality level parts changed or repaired Refabrication component like new recombined components 1 Upgrade component specified quality level upgraded product Figure 2: Different ways of preparing product ReUse 1 upgrade is possible if applicable In specific product areas ReUse promises huge economic as well as ecological advantages, because during ReUse, also metaphorically described as the ultimate and most comprehensive form of recycling [14], [5], the added value of previous production processes will be conserved. Depending on age and condition of the products, it may be reasonable to ReUse either the whole appliance or only single components. To assess the possibilities for the ReUse of a product precisely, different aspects have to be taken into account and evaluated. In this evaluation a broad range of factors will influence the pros and cons of ReUse, which have to be considered on a technical, economical and ecological level. The following criteria should be examined and evaluated [14]: Technical criteria (kind and variety of parts and materials used, suitability for disassembly, cleaning, testing);

5 Quantitative criteria (amount of returning products, timely and regional availability, ); Value criteria (value added from material/production/assembly); Time criteria (e.g. planned product life time versus effective life time, ); Innovation criteria (replacement of products a long time before they reach their economic end of life); Disposal criteria (efforts and cost of alternative processes to recycle the products and possible hazardous components, ); Criteria regarding compatibility of reused devices with standards of newly EEE (competing or cooperation with OEMs, ); and Other criteria (market behavior, liabilities, patents, intellectual property rights, ). 5 ECONOMIC AND ECOLOGICAL ASPECTS In Germany, the ReUse of electrical and electronic equipment is conducted by a variety of different actors. Disassembly companies, social enterprises and repair facilities as well as manufacturers conduct an active take-back and refurbishment. In this paper, we focus on the manufacturer s perspective, because great economic potential can be expected in this area. A prerequisite for the ReUse of products or their components is the presence of a corresponding demand. On the one hand, this demand can result from the need for spare parts, for example, if new products or components aren t available. On the other hand, the demand for products with different functionality can be satisfied from ReUse. If a demand for ReUse-products or -components exists, sources of electrical and electronic equipment for reuse and refurbishment need to be tapped. From a manufacturer s perspective, sources for reusable equipment are mainly given by the take back of products from lease and rent, warranty and commercial returns, production scrap and by-products and surplus in stock [7]. If returned products are available, ReUse can take place. ReUse has an economic potential, if the costs of collection and procurement as well as refurbishment can be compensated by the revenues from the sale of ReUse-products. The costs for collection and procurement include inspection, repurchase price and transportation. The repurchase price can be reimbursed in a lump sum as well as depending on the quality of the returned products or depending on the demand for the returned product or for the components contained. Usually, products of a higher quality in return usually are more expensive than products of a lower quality. Refurbishment costs go along with the refurbishment steps of disassembly, inspection, cleaning, refurbishment (narrower sense) or exchange and (re-)assembly. For the refurbishment of a returned product into a high functionality, higher costs are expected, compared to the costs for the refurbishment of a returned product with the same quality into a lower functionality. The refurbishment costs can be reduced in the product design by influencing the product specifications. A recycling-relevant product design may increase the design and manufacturing costs, but reduces the costs for refurbishment and reuse dramatically, see Figure 3 [8].

6 Costs Slight increase in the design and production costs Planning Design Production Utilization Significant reduction of costs for reuse and recovery Reuse/ Recovery Degree of freedom in product design Figure 3: Manufacturing vs. ReUse costs. [8] In addition, common parts between different products should be taken into account during the product design. Next to the recovery into same product types, returns can be used to generate products of a different product type if common parts exist. Such recovery options, focussing on a recombination of components, bear great economic potential if the product types in return and demand do not coincide. The surplus of not demanded returns might be used to cover shortfalls of returns for demanded product types. [17] Figure 4 illustrates the described strategy of common parts. Demand Take-back Demand variant 1 Demand variant 2 Demand variant 3 Take-back variant 1 Product und component recycling potential from variant 1 for variant 1 Product und component recycling potential from variant 1 for variant 2 or variant 3 Time Figure 4: Demand vs. Take-back [17] Manufacturers of the new products as well as third parties can offer ReUse-products on the market. If refurbishment and reuse can be done in an economic way, another market segment can be served in addition to the recent market segment for new products. In this market segment, manufacturers offering new products with a lower functionality for lower prices are predominant. With appropriate market segmentation, the markets of new products and ReUse-products can be well differentiated from one another. Accordingly, the risk of market cannibalization doesn t exist [10]. The revenues achieved are determined by the price, the customers are willing to pay. Furthermore, the prices differ due to the functionality of the ReUse-products. Thus, ReUse-products with functionality as new can realize a higher price than products with less functionality. In general, new products are preferred if the refurbished product is offered to a marginally lower price. For this reason, higher prices for ReUse-products with high functionality can be achieved only if new products are no longer available. Besides these economic aspects, ReUse also has a social potential. For example, in Germany an increasing number of companies offer work to disabled people by refurbishing electronic data processing technology. Furthermore, ReUse entails an ecological potential: Environmental effects of the production of new components and products can be saved by ReUse, if ReUse substitutes the demand for new components or products. The use of energy and material for the refurbishment of products increases the environmental effects [16], but this effect is much lower than in the production of a new product. Consequently, ReUse offers ecological potentials, if the savings in environmental effects of production and use are higher than the additional environmental effects caused by ReUse and the extended use-phase.

7 6 APPLICATION OF REUSE In order to illustrate the application of ReUse in practice, an example of the medical device industry is set out in the following chapter. Siemens AG Healthcare Sector performs four kinds of product return i.e. Refurbished Systems, Component Reuse, Extraction of spare parts and Recycling (see Figure 5). Product Take Back Waste Management Figure 5: Product return concept of Siemens AG Healthcare Sector (2010). All kinds of product return contribute in their special way to a recycling economy and a sustainable development in our urbanized world. For example Refurbished System contributes with offering affordable safe and effective medical equipment to a broad range of customers from entry level up to value level. By saving resources due to refurbishing Siemens Healthcare helps their customers to cut their CO2 emissions and improve their environmental performance. 6.1 Refurbished Systems Safety and effectiveness are the most important aspects for Refurbishment of medical equipment. To offer safe and effective used medical equipment and to eliminate risks for patients, users and for the environment it needs to be processed in a dedicated way. Such a dedicated way of processing used medical equipment has been practiced by several companies in the healthcare sector for several years and was described by COCIR under the concept of 'Good Refurbishment Practice (GRP)' [5]. GRP ensures that medical equipment processed according to the GRP principles will meet all quality, performance and safety standards applicable as when the medical equipment was put into service for the first time. In an organization performing GRP a dedicated process as well as an adequate quality management system needs to be established. Siemens Healthcare Refurbished Systems Proven Excellence Process is such a dedicated process in compliance with GRP [1]. In the following the five steps of good refurbishment practice in case of Medical Equipment are described. The selection of used medical equipment is based on: Intended use of the medical equipment Planned lifetime Applicable standards, which includes a process to evaluate the market access requirements

8 Service/ maintenance history and existing procedures Disassembly, packing and shipment of used medical equipment for refurbishment If the medical equipment was used in a special environment (e.g. emergency room, laboratory) it might be necessary to de-contaminate it before disassembly. The used medical equipment is checked before disassembly regarding unit identification The used medical equipment is disassembled packed and shipped in a way that it will not be damaged. It should be in the same condition as it was before disassembling (e.g. avoid additional risks due to disassembling). Appropriate actions are taken to avoid violation of privacy rules concerning patient data stored on the relevant medical equipment. Refurbishment A refurbishment plan is described and followed to define the equipment configuration (e.g. according to customer order) within the scope of the original product registration when the equipment was put into service for the first time. The used medical equipment is systematically cleaned and disinfected before refurbishment due to its use in a medical environment. Cosmetic refurbishment is done according to the refurbishment plan (e.g. take care of bio-compatibility). Mechanical and electrical refurbishment and system configuration in accordance with the refurbishment plan (i.e. inspection, identification and replacement of worn parts with original parts or original spare parts) With the installation of safety and performance updates (hardware/ software) all applicable safety and performance updates which are released for this type of medical equipment are performed. For any medical equipment refurbished according to the Good Refurbishment Practice performance and safety tests are to verify so that the system meets the defined performance and safety specifications for its type. The medical equipment is provided with original user documentation in the required language or in a verified translation. After successful completion of all necessary refurbishment actions, Siemens Healthcare Refurbished Systems releases the medical equipment, declares compliance to GRP (GRP declaration) and labels the medical equipment accordingly Packaging, shipment and installation of refurbished medical equipment The packing and shipment of the refurbished medical equipment is processed in the same way as for new medical equipment to meet the applicable performance and safety standards. Refurbished medical equipment is installed following the same installation procedures as new medical equipment. Post-market services After the installation of refurbished medical equipment, Siemens Healthcare Refurbished Systems provides services and support similar to the relevant type of new medical equipment. 6.2 Component ReUse The components reused are mostly gained within the customer services activities. They are processed in a dedicated quality process. An example for the successful component ReUse is the ReUse of x-ray tubes at Siemens Healthcare. Frequently used x-ray tubes have an average life time up to several years. Some components especially non wearing parts of the x-ray tube can be reused. After disassembly at customer site and transport to Siemens Healthcare the x-ray tubes are thoroughly quality checked in a defined process. After checking the reusable non wearing parts they may be reused or have to be refurbished. The reconditioned compo-

9 nents can be used for the manufacturing process of x-ray tubes if they are qualified as good as new according to IEC [9]. Around 50 % of the weight of a x-ray tube will be reused (Siemens AG, 2008). 6.3 Extraction of Spare Parts and Waste Management Siemens Healthcare extracts spare parts out of several dedicated products. The recovered components will be send back to the manufacturers since only they have the knowledge, tools and processes to repair or refurbish the recovered components. Following this process the recovered components are put back into the spare part loop of Siemens Healthcare. At the end the components become available for the customer services once again. Furthermore Siemens Healthcare offers its customers in Germany a certified waste management procedure to take back their medical equipment if they become end of life products and need to be treated and processed in a dedicated way in compliance with waste management regulations. 7 CONCLUSION, SUMMARY, PROSPECT Reuse of used appliances offers the highest value creation within the different ways of recycling, since already created value of existing parts will be preserved. Accordingly defect parts or operational substrates have to be manufactured again or have to be reconditioned by additional processes. From the ecologic point of view, ReUse conforms to the highest requirements. Compared with new production, ecological impacts are implicated in an appreciable manner essentially only by the logistic chain and the manufacturing of a small amount of parts. Compared with new manufacturing of a product up to 90% of material and energy resources can be saved. Basically the question Is remanufacturing making sense? cannot be answered in general [2], [3]. According to energy savings at the use phase of electric appliances (e.g. household appliances) it can be wise to replace the appliances after a middle period of use. Whereas for the owner of appliances it is not always profitable from a economic point of view to change after a longer period of time. The decision from recycling companies on the other side for or against the ReUse of appliances is essentially based on an economic evaluation. In principal ReUse seems to be favorable, because products have to be manufactured only partially again. The VDI guideline 2343 part»reuse«addresses a comprehensive assistance concerning reuse. In particular questions of brand images, selling and distribution strategies and market development for ReUsed products shall be taken into consideration. Therefore, it is absolutely necessary to support the improvement in the areas mentioned above by a specific guideline. There is a lot of challenging work for the guideline committee that needs to be done. The committee for this guideline is still open for cooperation. Interested people are invited to contact the chairman directly.

10 References [1] Arglebe, Carlos; Braun; Markus; Plumeyer, Martin (2008): Medical Electrical Equipment Good Refurbishment Practice. In: Proceedings Electronic Goes Green Fraunhofer IRB Verlag, Stuttgart. [2] Brüning, Ralf; Plumeyer, Martin; Rosemann, Bernd; Enderle, Bettina (2009) Guideline VDI 2343 focuses ReUse, offering excellent business possibilities in "Prosperity Waste and Waste Resources" - Peter Lechner (Ed.) 3rd BOKU Waste Conference [3] Brüning, Ralf; Rosemann, Bernd; Enderle, Bettina (2008) WEEE: Recommendations on ReUse for the Concerned Parties The Guideline VDI 2343, in Proceedings First World ReUse Forum [4] Brüning, R. (1996): Systematische Entwicklung eines Entscheidungsmodells zur Beurteilung der Recyclingeignung elektrischer und elektronischer Produkte (Diss), Deutscher Fachverlag, Frankfurt. [5] COCIR (2007): Good Refurbishment Practice for Medical Electrical Equipment, Advancing Healthcare in Europe. Brussels, Belgium. [6] ElektroG (2005): Electrical and Electronic Equipment Act (ElektroG). In: Federal Law Gazette, Berlin. [7] Fleischmann, M. (2001): Quantitative Models for Reverse Logistics. Springer Verlag, Berlin u.a. [8] Herrmann, C. (2003): Unterstützung der Entwicklung recyclinggerechter Produkte. Essen Ruhr: Vulkan- Verlag GmbH. [9] IEC (2004): Dependability of products containing reusable part Requirements for functionality and test, IEC. [10] Luger, T.; Herrmann, C.; Steinborn, J; Walther, G.; Spengler, T. S. (2008): Wertschöpfung durch Mehrfachnutzung Potenziale, Herausforderungen, Lösungen. In: ZWF Zeitschrift für wirtschaftlichen Fabrikbetrieb, Vol. 103 (9 [11] Pschera, T.; Enderle, B. (2007): ElektroG, Kommentar, in: Fluck (Hrsg.), Kreislaufwirtschafts-, Abfallund Bodenschutzrecht (Loseblattsammlung), Vol. 2/II, 2007 Heidelberg, Deutschland: C.F. Müller Verlag, Heidelberg. [12] ROHS: Directive 2002/95/EC of the European Parliament and of the Council of 27 January 2003 on the restriction of the use of certain hazardous substances in electrical and electronic equipment. Brussels, [13] Rosemann, B.; Steinhilper, R. (2006): Design for Remanufacturing; SAE World Conference, Detroit. [14] Steinhilper, R. (1999): Produktrecycling Vielfachnutzen durch Mehrfachnutzung; Fraunhofer IRB Verlag, Stuttgart. [15] VDI (2009): Portal für Ingenieurinnen und Ingenieure. Verein Deutscher Ingenieure, VDI, Düsseldorf, [16] Walther, G. (2010): Nachhaltige Wertschöpfungsnetzwerke Überbetriebliche Planung und Steuerung von Stoffströmen entlang des Produktlebenszyklus. Gabler, Wiesbaden. [17] Walther, G; Steinborn, J.; Spengler, T. S. (2009): Variantenvielfalt und Lebenszyklusbetrachtungen im Remanufacturing. In: Heyde, F.; Löhne, A.; Tammer, C. (Hrsg.): Methods of Multicriteria Decision Theory and Applications. Shaker Verlag. [18] WEEE (2002): Directive 2002/95/EC of the European Parliament and of the Council of 27 January 2003 on waste electrical and electronic equipment (WEEE). Brussels. [19] WFD (2008): DIRECTIVE 2008/98/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL Brussels.