EuP: The coming regulation storm, Part 2

07.11.2006
Welcome to Part 2 of last week's installment of .

The crux of last's week's column is that the E.U.'s EuP (energy using product) initiative will require manufacturers to track the amount of energy used in the creation of a product from cradle to grave. This includes the energy used to extract raw materials, to push materials through the supply chain, to deliver the product, and finally to dispose of the product at the end of its lifecycle.

As promised, I'll now delve into the EuP initiative's impact on IT, supply chain, and software.

Part of the purpose of the EuP regulations "in its own insidious way" is to promote recycled materials, says Michael Kirschner, president of DesignChain Associates, a company that offers consulting services on the supply chain implications of product design.

For example, Kirschner points out that a manufacturer designing a product using sheet metal must consider the energy-use metrics for producing a virgin piece of sheet metal vs. using recycled sheet metal. The manufacturer must also consider that the recycled material may not have the same purity level.

There are supply chain and software issues as well. IT will have to find a data "container" that keeps information in a coherent form for analysis, and to generate reports in a form that's usable by engineers, marketing departments, and regulators. A company's distribution channel may prove suboptimal to meet EuP requirements. For example, rail may use less energy than transporting the product with big rigs.