quantification of carbon emission reductions solplast pallets csa

Quantification of Net CO2,eq ERs for the manufacturing of pallets by Solplast

Inc. (2002-2006)

Quantification of Net CO2,eq Emission reductions for the manufacturing of pallets made from 100%

recycled plastic by Solplast Inc. (2002-2006)

Site: Montreal Plant

Quantification of Net CO2,eq ERs for the manufacturing of pallets by Solplast Inc. (2002-2006)

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This report was produced by Stabilis Inc. for Solplast Inc. The report was prepared by Philippe Simon and reviewed by Jean-Louis Bertrand.

Jean-Louis Bertrand, Chemist, Ph.D. Philippe Simon, Eng. Ph.D. August 17, 2007


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ABREVIATIONS

CH4 : methane CO2 : carbon dioxide CO2,eq : carbon dioxide equivalent, normally expressed in tonnes EPA : Environmental Protection Agency (USEPA) EPDM : Ethylene Propylene Diene Monomer (rubber) ER : Emission reductions GHG : Greenhouse gas HDPE : High Density Polyethylene HPM : High Pressure Moulding LDPE : Low Density Polyethylene LPM : Low Pressure Moulding MDPE : Medium Density Polyethylene MRF : Material Recycling Facility MT : Metric ton MTCE : Metric ton of carbon equivalent = 3.67 MTCO2e MTCO2e : Metric ton of carbon dioxide equivalent N2O : Nitrous oxide PP : Polypropylene


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EXECUTIVE SUMMARY The purpose of this report is to document the reduction of carbon dioxide equivalent

(CO2,eq) emissions, in accordance with the ISO 14064-2 standard, by Solplast Inc. at its

plant located in Montreal, Province of Quebec, Canada. The emission reductions were

created by manufacturing plastic pallets from 100% post consumer recycled plastics.

After using the appropriate baseline or reference scenario, it has been calculated that

Solplast Inc. has created total GHG ERs of 22 614 metric tonnes of CO2,eq during the

period from 2002 through 2006. The present report can be amended to demonstrate that

the ERs quantified herein can meet eligibility requirements defined by most trading

institutions and tailored to satisfy a transaction of emission reductions to be made Over-

The-Counter (OTC) or at the Chicago Climate Exchange.


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1.0 Project and proponent information Project Name Quantification of Net CO2,eq Emission reductions for the manufacturing of pallets made from 100% recycled plastic by Solplast Inc. Years quantified 2002-2006 Name of Proponent Solplast Inc. (514) 254-8525 www.solplastinc.com Location of activities of the project Montreal Plant, 1501 rue des Futailles, Montreal (Québec) Canada H1N 3P1 GHG Program This project subscribes to the GHG CleanProjects™ Registry based on ISO 14064 standards for greenhouse gas inventory and reporting GHG Type Waste diversion GHG Emission reductions Claimed in this Report:: 22 614 metric tonnes of CO2 have been quantified from the manufacturing of plastic pallets. These have been verified to a level of limited assurance by Carbon Quantum. 2.0 Ownership Solplast Inc. has the legal right to title of the emission reductions that are quantified in this Report. These emission reductions have not been claimed by Solplast Inc. or its shareholders or any other entity as emission reductions under any other program, or used to meet any regulatory requirements that were in place at the time of reporting. Solplast Inc. is the sole owner and beneficiary for 100 % of the ERs claimed in this report.


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3.0 Proponent’s description and history Solplast Inc. has been operating since November 2002 under the existing corporate structure. It was founded and built on the concept of recycling plastic, both post consumer and industrial, into material handling equipment (pallets). The 100% post consumer recycled plastic pallet business has its own niche as the plastic version is a highly hygienic product, complies with new transportation regulations (phytosanitary), and eliminates the use of wood, hence trees. Moreover, it does not require fumigation, and can be recycled easily, all of which are clear advantages over the traditional wooden pallets. Solplasts high quality pallets have been recognized internationally; typical customers have addresses all over the world, including the USA, Latin America and Caribbean, Europe and the Middle East, all of which are regions of the world where Solplast Inc. exports over 80% of all its moulded products manufactured in Montreal. In some cases, Solplast Inc. has signed agreements to recuperate the product so it can be recycled again once its lifetime has elapsed, with the objective of “CLOSING THE LOOP”. Recycling plastics to manufacture pallets or to provide other manufacturers with recycled resin in the form of granules or chips avoids emissions from processing of raw materials and final elimination in landfill sites for all those post-consumer products. At the same time Solplasts unique durable pallets reduced the use of wood products which wood is the most common material used for pallets. Plastic recycling activities at Solplast rely on the supply of recovered materials from MURFs. Competitive Advantage and Impact of Solplast on the North American Market Four elements make Solplast Inc. unique in the North American market: 1) products made from 100% post consumer recycled plastic, 2) using low pressure injection molding technology 3) production of a standard heavy duty pallet, and 4) low production costs. Appendix A, provides more information on the manufacturing process of the pallets. Fewer than ten companies produce pallets made of 100% recycled materials in North America and most of these use a majority of post industrial plastic as opposed to post consumer. Furthermore, Solplast is the only one to produce 100% post consumer


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recycled plastics standard heavy duty pallets using low pressure injection molding technology. This heavy duty standard pallet weighs about 20-25 kg and is much more robust than the export light (6-15 kg) pallet. Due to its unique manufacturing plant, Solplasts is able to produce pallets at a much lower cost than its competition. Thus not only are Solplast products unique, but its low manufacturing costs further increases their competitive advantage. 4.0 Solplast Inc. Plant in Montreal – Technical Information Solplast’s plant in Montreal extends over almost 100 000 square feet and state-of-the-art equipment and technology has been installed within its walls.

All the water used in the plant goes through an internal filtration system, recycling 100% of the volume used for reutilization. This drastically reduces the water requirement of the plant.

Raw plastic to be recycled


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Recycled plastic end product

Manufactured standard heavy duty (20-25 kg) pallets from 100% post consumer recycled plastic


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Manufactured Export Light (~7 kg) pallets from 100% post consumer recycled plastic

View of the plant

The process basically involves washing the materials that are dried, whereas the dry line is used to process materials that are considered sufficiently clean to avoid washing. All


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inputs (after waste discards) proceed either to the wet line or to the dry line. The next transforming steps may depend on the type of outputs to be produced (moulded products or granules). Some of the HDPE resin recycled at Solplast is also moulded into light pallets that are assumed to take market shares in the softwood pallet business. The resin is shipped to a subcontractor which uses the casts provided and owned by Solplast to mould the light model of HDPE pallet. 5.0 Quantification of Emission reductions BASELINE SCENARIO The manufacturing activities of Solplast Inc. may result in a decrease of GHG emissions due to a source reduction where raw materials acquisition is diminished because manufacturing of newly made products uses a mix of virgin and recycled inputs instead of virgin input alone. The manufacturing of pallets made from recycled plastic is a good example of raw material substitution. Solplast’s production will therefore be considered a source reduction by material substitution (wood by plastic). It is estimated that approximately 90 % of all pallets sold in the US in recent years are made from wood (excluding composite wood) and 2% from plastic1. Therefore, in absence of Solplast, their 100% post consumer recycled plastic pallet will be replaced by hardwood or softwood pallets. In this scenario, Solplast pallets will substitute wood pallets in a ratio of 1:12 pallets which is conservative since Solplast plastic pallets can last for many more trips then wood pallets (as discussed in sub-section 1 of section 5). In order to assess the emission reductions in addition to those of the baseline scenario, the baseline scenario will stem from 2002-2006. The emissions resulting from the production of wooden and plastic pallets (in a 1:1 ratio) over this period of time will be compared. In absence of production data, it was not possible to use existing conditions (prior to 2002) as a baseline scenario.

1 Pallet Talk (newsletter), National Wooden Pallet & Container Association, Alexandria VA. April 2000. in Clark, J. Pallets 101: Industry Overview and Wood, Plastic, Paper & Metal Options. 2004. 2 Substitution calculations include mass conversion factors as the weight of wood is different then the weight of the pallets


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GHG EMISSIONS, SINKS AND EMISSION OFFSETS OF THE BASELINE SCENARIO and THE PROJECT CASE Table 1 lists all GHG emission, sinks and offsets of the baseline and project cases, for all Solplast’s activities involving manufacturing of pallets. TABLE 1 – LIST OF GHG EMISSION, SINKS AND OFFSETS FOR THE BASELINE AND PROJECTED SCENARIO Emission/Sink/Offset Baseline Scenario Project Scenario 1. Extraction, production and transportation of raw materials for the production of pallets

Yes. Manufacture of hardwood and/or softwood pallets.

No emission except for direct process energy emission. Plastic pallets are made from 100% recycled resin. Source reduction by raw material displacement since plastic will replace hardwood/softwood lumber for pallets. Offset obtained from avoiding tree harvest in the case of pallet production.

2. Energy-related emissions for manufacturing new final products (for consumer)

Yes, for production of wooden pallets.

Yes, some energy used for the production of plastic pallets.

3. Emissions for transporting final products to consumers

Yes Yes, including transport of pallets.

4. Waste management-related emissions

Transportation to landfill (in the absence of recycling)

GHG emission for waste management avoided. Loss rate during Solplast’s manufacturing activities from post consumer material results in final transportation of waste to landfill.

ANALYSIS OF THE RELEVANT EMISSION, SINKS AND OFFSETS FOR THE BASELINE AND PROJECT CASES GHG sources and sinks are associated with the manufacture of various materials and may also include the post-consumer stage when the material is wasted.


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The US EPA has published an exhaustive study on solid waste management and greenhouse gases. This source document has been chosen to produce all the coefficients used in this quantification of Solplast’s Emission reductions.3 Table 2 uses that source document to assign an emission coefficient to each of the GHG emission, sinks and offsets identified in Table 1, for both the baseline and project cases (the same numbers are used for each source, sink or offset in both tables). The exact reference for each coefficient appears in the footnote of Table 2. TABLE 2 – LIST OF GHG COEFFICIENTS

Emission/Sink/Offset Baseline Scenario

Project

1. Extraction, production and transportation of raw materials for the production of pallets

Emission for hardwood pallets manufacture of Dimensional Lumber is 0.054 MTCE per short ton of product

Emission from the production of 100% recycled HDPE is 0.055 MTCE per short ton of product.

2. Energy-related emissions for manufacturing new final products (for consumer)

Included in item 1 Included in item 1.

3. Emissions for transporting final products to consumers

Equivalent to project case

Equivalent to baseline case

4. Waste management-related emissions

Negligible or cancelling out

Negligible or cancelling out from loss rate built into other coefficients.

5. Change in carbon forest storage

Data not available

Plastic pallets made from 100% recycled HDPE resin displace hardwood or softwood lumber. Source reduction results in offset of 0.50 MTCE per short ton of hardwood/softwood pallet not manufactured.6 Mass conversions of plastic pallet to hardwood/softwood pallet will be used in calculations.

3 Solid Waste Management and Greenhouse Gases. A Life-Cycle Assessment of Emissions and Sinks. 3rdedition. United States Environmental Protection Agency. September 2006. 4 “Solid Waste Management and Greenhouse Gases. A Life-Cycle Assessment of Emissions and Sinks”. 3rd edition. United States Environmental Protection Agency. September 2006. Exhibit 2-2, page 24. 5 “Solid Waste Management and Greenhouse Gases. A Life-Cycle Assessment of Emissions and Sinks”. 3rd edition. United States Environmental Protection Agency. September 2006. Exhibit 2-2, page 24. 6 “Solid Waste Management and Greenhouse Gases. A Life-Cycle Assessment of Emissions and Sinks”. 3rd edition. United States Environmental Protection Agency. September 2006. Exhibit 3-1, page 34.


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1. GHG emission from extraction, production and transportation of raw materials

for the production of pallets No precise evaluation of the number of recycling stages for the baseline scenario (hardwood or softwood pallets) has been made because the fate of wood can take several routes and makes this evaluation quite inaccurate. For example, wood from pallets at the end of their lifetime can be:

• recycled into new pallets or other products; • sent to combustion; • composted or other biogenic emissions; • landfilled.

On the other hand, plastic pallets produced by Solplast have a much longer lifetime and can make hundreds of trips, whereas the wood pallets can survive between 2 to 25 trips while plastic pallets can last 100 trips7. Furthermore, it has been estimated that 50% of wood pallets are produced to last one trip8. Regardless of the possibility of recycling the plastics pallets at the end of their lifetime, the quantification will remain conservative by comparing the project case of plastic pallets and its related emission to the baseline case where hardwood or softwood pallets are substituted by Solplast’s pallets. Furthermore, it can be assumed that during the lifetime of the plastic pallet it would replace more than one wooden pallet. However, in this scenario, since the fate of the wood pallet is unknown, Solplasts pallets will substitute wood pallets in a 1:1 ratio. GHG emission for the manufacture of hardwood/softwood pallets and recycled plastic pallets are the per short ton of plastic pallets)9. As these almost cancel out, the only remaining coefficient to be considered in this quantification will be the source reduction on wood biomass shown in Table 2. This source reduction results in an offset from not cutting the trees, leaving intact some potential carbon sequestration. In addition, plastic pallets are much lighter than the

7 “Pallet Alternative Cost Calculator”. United States Environmental Protection Agency. 2006 http://www.epa.gov/GreenScapes/tools/pallets.pdf 8 "Are You Wasting Pallets and Money?" . Minnesota Office of Environmental Assistance. 19 May 2006. <http://www.moea.state.mn.us/berc/pallets.cfm> 9 “Solid Waste Management and Greenhouse Gases. A Life-Cycle Assessment of Emissions and Sinks”. 3rd edition. United States Environmental Protection Agency. September 2006. Exhibit 2-2. page 24.


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wood pallets, weighting between 15 – 60 lbs10 while wooden pallets can range from 30 to 120 lbs11. Thus using plastic pallets can also reduce emissions during transport of materials, which is a factor that has not been considered.12

As plastic pallets and wooden pallets have different weights, a mass conversion factor was also used to account for a pallet-for-pallet approach, for both of the most common models of plastic pallets made by Solplast. One model is heavy and sturdy and replaces hardwood pallets, whereas the light version replaces softwood pallets on the market. 2. Energy-related emissions for manufacturing of new (wood) pallets Energy-related emissions for manufacturing new products under the baseline or project scenarios have been discussed in section 1 for pallets. 3. Emissions for transporting final products to consumer This step of the life-cycle will be deemed equivalent for both the reference and the project cases. It is fair to assume that transportation of newly manufactured product made from wood to the end user is equivalent to transportation of new Solplast’s products, and therefore they cancel out. 4. Waste management related Emissions Waste management strategies in the post-consumer stage has no impact in the case of plastics, since the carbon is only transferred from the oil field to the landfill, apart from the energy-linked GHGs produced by manufacturing and transporting the materials. The only waste aspect that can be considered for the project case would be the waste generated from the loss rate when plastics are recycled by processing them at Solplast’s plant. However, they have not been used in the quantification calculations because the

10 Solplasts specs sheets. http://www.solplastics.com/specsheets/Flyer-2%20Standard%20Use.pdf 11 Uline catalog. http://www.uline.com/Browse_Listing_8201.asp?desc=Hardwood+Pallets 12 “Innovative Strategies to Reduce GHG Emissions from Mobile Sources”. Melissa Vernon, Interface Inc. Presentation for the EPA Climate Leaders Conference. January 13, 2004. http://www.epa.gov/climateleaders/docs/vernon.pdf


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coefficients used from Exhibit 2-2 from the US EPA study already include the management of losses at the recovery stage and at the remanufacturing stage. The remanufacturing stage average loss rate for plastics is 14%. Therefore, this rate is implicit and remains included in all the coefficients used in this report, meaning that Solplast is using a little more than 1,16 MT of input to generate 1,00 MT of output. Table 3 presents the total MTCO2e for each year from 2002 to 2006. Source data was provided as Excel Spreadsheets directly from Solplast’s production reports. All detailed calculations using the source data is also presented as spreadsheets in Appendix C.


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Table 3 – Summary of annual Emission reductions in MTCO2e for the production of 100% post consumer recycled plastic pallets

Baseline Scenario Project Net Emissions= (Baseline Scenario – Project)

Pallets Productio

n (MT)

Production Emissions

Factor (MTCe/shor

t ton)

Carbon sequestration

emission reductions

Emissions factor:

MTCO2e/MT wooden pallets13

Emissions (MTCO2e)/ MT

wooden pallet14

Production (MT)

Production Emissions

Factor (MTCe/short

ton)

Emissions (MTCO2e)/Plastic pallets

Increase carbon sequestration

by source reduction factor (MTCe/short ton

wood pallets)

Emissions factor from

MTCe to MTCO2e/MT

plastic pallets15

Emission reductions

from carbon sequestation (MTCO2e)16

Project Total Emission

Reductions (MTCO2e)17

2002 - (hardwood) 482,33 0,05 0 0,20 96,47 482,33 0,05 96,47 -0,50 -2,59 -1248,80 -1248,80

2002- (softwood) 0,00 0,05

0 0,20 0,00 0,00 0,05 0,00 -0,50 -3,51 0,00 0,00

2003- (hardwood) 1784,10 0,05

0 0,20 356,82 1784,10 0,05 356,82 -0,50 -2,59 -4619,24 -4619,24

2003- (softwood) 55,29 0,05

0 0,20 11,06 55,29 0,05 11,06 -0,50 -3,51 -193,85 -193,85

2004- (hardwood) 2123,79 0,05

0 0,20 424,76 2123,79 0,05 424,76 -0,50 -2,59 -5498,71 -5498,71

2004- (softwood) 92,48 0,05

0 0,20 18,50 92,48 0,05 18,50 -0,50 -3,51 -324,23 -324,23

2005- (hardwood) 1847,48 0,05

0 0,20 369,50 1847,48 0,05 369,50 -0,50 -2,59 -4783,33 -4783,33

2005 (softwood) 174,98 0,05

0 0,20 35,00 174,98 0,05 35,00 -0,50 -3,51 -613,50 -613,50

2006- (hardwood) 1414,32 0,05

0 0,20 282,86 1414,32 0,05 282,86 -0,50 -2,59 -3661,84 -3661,84

2006- (softwood) 476,33 0,05

0 0,20 95,27 476,33 0,05 95,27 -0,50 -3,51 -1670,04 -1670,04

13 Emissions factor 0.2 = 0.05 MTCe/short ton * 1.1 short ton/MT * 3.67 MTCO2/unit MTCE 14 Emissions (MTCO2e)/ MT wooden pallet = Emissions factor * Production 15 Emissions factor (MTCO2e/MT plastic pallets) = productions emissions factor * 1.1 short ton/MT * 3.67 MTCO2/unit MTCE * 1.28 MT hardwood

pallets/MT plastic pallets or 1.73 MT softwood pallets/MT plastic pallets. The standard hardwood pallet weight is 32 kg, whereas the average HDPE pallet weight is 25 kg. The standard softwood pallet weight is 13 kg, whereas the average light HDPE pallet weight is 7,5 kg

16 Emission reductions from carbon sequestration= Production (MT) * Emissions factor (MTCO2e/MT plastic pallets 17 Project Total Emissions = Baseline scenario – project scenario: Production Emissions (MTCO2e)/ MT wooden pallet – Production Emissions (MTCO2e)/Plastic pallets - Emission reductions from carbon sequestration (MTCO2e)


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Total-Pallets

(hardwood) 7652,02 1530,40 7652,02 1530,40 -19811,92 -19811,92 Total-Pallets

(softwood) 799,07 159,81 799,07 159,81 -2801,62 -2801,62 2002 482,33 96,47 482,33 96,47 -1248,80 -1248,80 2003 1839,39 367,88 1839,39 367,88 -4813,09 -4813,09 2004 2216,26 443,25 2216,26 443,25 -5822,94 -5822,94 2005 2022,46 404,49 2022,46 404,49 -5396,83 -5396,83 2006 1890,65 378,13 1890,65 378,13 -5331,87 -5331,87

2006 - 2006 8451,09

1690,22 8451,09 1690,22 -22613,53 -

22613,53

Quantification of Net CO2,eq ERs for the manufacturing of pallets by Solplast Inc.

(2002-2006)

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From Table 3, for year 2002 through 2006, the total quantity of ERs resulting for the production of 100% post consumer recycled plastic pallets amounts to - 22 614 MTCO2e. The emissions for the baseline scenario are 1690 MTCO2e. We conclude that the GHG emission reductions incurred through this project are permanent as there will be no re-emitting of GHG`s once the recycled plastic pallets are disposed of in a landfill as the emissions are negligible. 5. GHG ERs factors: Availability, reliability and limitations: The EPA`s “Solid Waste Management and Greenhouse Gases. A Life-Cycle Assessment of Emissions and Sinks”, was the principle reference document used to obtain GHG ERs factors for the Solplast project. Other than this source document, the following sources of GHG emission factors also were consulted. Table 4 shows the results of the consultations: Table 4 – Alternative sources of information consulted to quantify the GHG reductions for plastic recycling activities.

Source Outcome Ministère du développement durable, environnement et parcs (MDDEP) http://www.mddep.gouv.qc.ca/air/calcul-ges/tableurs.htm

Does not present any emission reductions factors for wood or plastic.

California Climate Change Registry http://www.climateregistry.org/PROTOCOLS/GRCP/

The Forestry Sector Protocol mentions a carbon storage factor of 0.5 MTCe/short ton of dry wood. This is the same factor as used by the EPA document

GHG Protocol initiative : World Resources Institute http://www.ghgprotocol.org/templates/GHG5/layout.asp?type=p&MenuId=ODQ5

GHG emission calculator for wood manufacturing facilities.

IPCC - 2006 IPCC Guidelines for National Greenhouse Gas Inventories http://www.ipcc-nggip.iges.or.jp/public/2006gl/index.htm

Chapter 12 of the 2006 IPCC Guidelines for National Greenhouse Gas Inventories Volume 4 Agriculture, Forestry and Other Land Use, also refers to a carbon sequestration factor of 0.5 MTCe/short ton of dry wood.


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Both the IPCC and the California Registry documents include the same factor as the EPA document18 of 0.5 MTCe/short ton of dry wood. However, none of the above mentioned documents had any GHG emissions information on plastics. Only the EPA document contained GHG process emissions factors for both wood and plastic. The EPA document was also very reliable and contained well researched and established GHG emission reductions factors for the manufacturing and recycling of waste. Factors in this document are calculated based on actual averaged national data and models which are updated regularly. The EPA source used in this document includes some sensitivity analyses but does not treat uncertainty or variability since statistical information is not available, and cautions that the average emissions factors they report may have limitations. Also, it does not consider CH4 and N2O into the transportation-related GHGs, knowing that the contribution of these two gases is in most cases de minimis and can be discarded. However, for most industrial processes taking place in the United States (and by extension to Canada), and in particular for manufacturing materials like virgin plastic resins, those average coefficients are reasonably reliable for our baseline case. The coefficients used however, remain the ones from the US EPA study. Despite the limitations of the report, the EPA believes that “the results (of the document) are sufficiently accurate to support their use in voluntary programs”. Furthermore, the report includes explanations for the methodology used and references in the calculations of their GHG emission factors. 6.0 Data Handling and Storage Basic inputs and outputs of Solplast Inc. are handled by weighing all loads entering the receiving area and all loads leaving the shipping area. All the data is generated by a load cell located on the private access road south of the main office building19. Net loads are then compared to delivery data produced by the suppliers of inputs, and final data is confirmed by producing an entry with a serial number that will accompany the fate of the load throughout the recycling activities of the plant. Similarly, loads leaving shipping are weighed at the load cell and new entries are produced to register all outputs of the plant towards:

• Buyers of moulded products • Waste management company (landfill)

18 “Solid Waste Management and Greenhouse Gases. A Life-Cycle Assessment of Emissions and Sinks”. 3rd edition. United States Environmental Protection Agency. September 2006. 19 The load cell at Solplast is calibrated once a year by a third party specialized company.


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All entries are then handled by accounting and aggregated into a series of Microsoft Excel spreadsheets that are produced daily. The data produced shows both inputs and outputs of the plant. This allows to track down problems that may arise with a particular input on a production line (for example, contaminated shipment purchased from the broker, or input not complying or not corresponding to specifications or certificate of analysis). Solplast Inc. stores a daily back up of all of its data into a fireproof vault located at the same address. A step-by-step description of how data is gathered and kept from inputs to outputs at Solplast Inc. is included in Appendix B. This description follows each step of the production lines and therefore might be useful to the reader to grasp all aspects of Solplast’s operations. 7.0 Project Team The project Manager at Solplast is Mr. Eric Bilodeau, chartered accountant and lawyer, Director of financial and legal Affairs. All data used in this report was communicated by Mr. Bilodeau to Stabilis inc. for quantification purposes and for the preparation of the present report. Copies of the GHG training of qualified personal involved in this project are included in Appendix D.


APPENDIX A

SOLPLAST PALLET PRODUCTION AND ITS COMPETATIVE ADVANTAGE


Solplast pallet production and its competitive advantage

In order to define the base line scenario that 100% post consumer recycled plastic pallets would be a substitute for hardwood/softwood pallets, it is important to determine if Solplast pallets could be easily replaced by a competitor should Solplast leave the market. The following presents Solplast’s distinctive products and operations.

Impurities and the natural characteristics of post consumer recycled plastic make it blow molding grade plastic which is highly viscous and has a longer polymer chain than virgin injection grade plastic. Pallets made from 100% of this recycled plastics are designed with thicker walls than those made with virgin and/or virgin/recycled plastics. The larger quantity of plastic used in each pallet increases the cost of production, which would reduce the profitability/pallet of a similar project today. The long molecular chain and thicker walls make Solplast pallets very durable and impact resistant compared with pallets made from virgin plastic. Furthermore, Solplast uses low pressure injection molding technology which reduces the compaction of the material and therefore molecular stress on the plastic which further increases the resistance of the pallet. Contrarily, virgin plastic uses high pressure injection molding technology. Therefore, the Solplast combination: nature of the material and the molding technology used, results in a highly resistant pallet made from 100% post consumer recycled plastic.


APPENDIX B

DETAILED DESCRIPTION OF STEPS OF DATA COLLECTION, USE AND STORAGE AT SOLPLAST INC.


Purchases of input materials and reception:

Each order is assigned a purchase order number (RM number), Upon arrival at Solplast, the gross weight of the truck carrier is measured

and generates a numbered weight certificate, which is printed at that time.

There is one RM number per load The contents of the van are emptied at the shipping/reception dock Once empty, the truck is weighed again to generate a new weight

certificate. The net load is computed from the difference between the two

certificates. The weight certificates are submitted to the accounting department and

coupled to the original purchase order. The net load result is faxed to the supplier for invoicing purposes.

Each lot received (by RM number) is registered into the accounting system for inventory control (Dynacom software).

Storage of input materials :

Input materials (received from materials recovery facilities) are stored in

tractor trailers or in the raw materials storehouse. At this stage, all lots received at shipping have been assigned a RM number.

Data Treatment :

Input use tracking :

All inputs used are tracked by RM number and by weight from original reception to the production line, where spreadsheets are also generated to appear in a complete daily production report (Excel). The accounting department uses this same production report to track input material use, generation of semi processed of new end-products, and to maintain updated inventories of raw materials and finished products inside the plant.

Output tracking (except for waste, see inside report)

Moulded products: All the production of moulded products is incorporated (materials used and model and number of pallets manufactured) into the Excel production report. The accounting department uses this same information as source for the Dynacom accounting system to keep track of its inventories of pallets.

Granulation products: All the production of granulation products is

incorporated (materials used and product code number) into the Excel production report. The accounting department uses this same information


as source for the Dynacom accounting system to keep track of its inventories of granules.

2) Data storage:

All computerized production and financial data at Solplast are stored on its server. Daily back up is performed on a removable hard disk which is stored in a fireproof safe on the premises.


APPENDIX C

CALCULATIONS SPREADSHEETS CALCULATION OF SOLPLAST’S PLANT GHG EMISSION REDUCTIONS

Quantification of Net CO2,eq EmissionReductions for the manufacturing of plastic pallets made from 100% post consumer recycled plastic (2002-2006)

Summary of ERs

ITEM 2002 2003 2004 2005 2006 Total

Pallets (hardwood) 1,249 4,619 5,499 4,783.3 3,661.8 19,811.9Pallets (softwood) 0 194 324 613.5 1,670.0 2,801.6TOTAL 1,249 4,813 5,823 5,397 5,332 22,613.5

Net CO2 reductions (MTCO2e)

prepared by Stabilis Inc.


APPENDIX D

GHG TRAINING CERTIFICATES OF QUALIFIED PERSONAL

quantification of carbon emission reductions solplast pallets csa

Documents