Stuart Sleeman Principal

Sleeman Hanley & DiNitto, Inc

A Review of the Impact of European Union Environmental Directives

Comprised of three major business units: Sensors

Controls

More than 6,000 employees around the globe

Technology Development and Manufacturing in nine locations in the Americas, Asia and Europe

Sensata Technologies

Product Content Management

Requirements

• Customer

Requirements:

– Contracts and

specifications

– Surveys/

Declarations

– Influence

• Current and Horizon

Legislation/ Industry

Standards

– Discover and

Understand

– Influence

• Science and R&D

Decisions & Strategy

• Business-Wide Strategy

• Planning and Roadmaps

• TI Ban List Content Decisions

• Strategy for Customers

• Strategy for Suppliers

Execution

• Internal Manufacturing• Specifications• Chemicals & Materials• Equipment• Change Control

• External Manufacturing• Specifications• Subcons/Foundries• Change Control

• R&D• Market Management

• Internal Communication of Decisions

• External Communication and Customer Management

• Supplier Management• Ban List Management

EC Directives (WEEE; ROHS & ELV)

Directive on Waste Electrical and Electronic Equipment (WEEE)

Directive on Restriction of Use of Certain Hazardous Substances (RoHS)

Directive on End-of-Life Vehicles (ELV)

EC Directives/Material Content Reporting

Sony swaps PlayStation One cablesLast modified: December 5, 2001, 11:55 AM PST

By Reuters         Sony is replacing peripheral cables for 1.3 million PlayStation One game consoles after the Dutch government blocked sales of the machines because of health and environmental concerns. The Dutch government said Tuesday it had blocked shipment of the consoles and 800,000 accessories bound for the European Union market in a warehouse in the Netherlands because the cables contained too much cadmium. On Wednesday, Sony said it had already started replacing the cables. It hoped to resume limited shipments of the consoles by mid-December. "Although we have reservations about the interpretation of the regulations (by the Dutch authorities), we have begun replacing the cables," a Sony representative said. Sony said its newer PlayStation 2 consoles were not affected by the ruling because they do not use the same cables. The company will not replace cables for PlayStation One consoles sold in countries outside Europe if they did not violate environmental regulations in those nations, the company said. Sony also said it will not recall any consoles already sold in Europe because the amount of cadmium in the cables does not--in its view--pose a health risk. The cadmium contained in the cables only poses a risk if incorrectly disposed of, in which case it could have long-term environmental effects, Sony said. Within the European Union, no goods are allowed to be imported that contain more than 0.01 percent cadmium. The Netherlands said the cables contained three times to 20 times the allowed amount. A spokesman for the Dutch Environment Ministry said Tuesday that large concentrations of cadmium are banned in the Netherlands--in line with European Union policy--to prevent it from entering the food chain. "Cadmium damages the kidneys," ministry spokesman Joost Kehrer said. Sony did not say how much the cable replacement will cost the company.

EU Material Content Directives

Vehicle End of Life Directive

Manufactures sensors that are used in various automotive systems.

Supply to all the major automakers directly as a tier one supplier or through others as a sub-tier supplier.

IMDS Entry Requirements:- existing product lines- new product lines (PPAP)- 50% - 70% complete

Automotive SensorsCoolant Level

AirConditioning

PowerSteering

ABS

OilPressure

AngularRateSensor

Low GAccel.

Trans- mission

OccupantWeight

TirePressure

• The European Parliament & the Council of European Union signed the End-of-Life vehicle directive on 9/18/00. Directive 2000/53/EC, effective 1/03.

• Objective is the prevention of waste from vehicles and also the reuse, recycle, & recovery of end-of life vehicles and components, thus improving environmental performance for all economic operators involved.

• Automobile producers to provide appropriate information to treatment facilities, concerning dismantling, and re-use

End of Life Vehicles Directive

Requirements:

Ban on the use of hazardous substances (lead, mercury, cadmium, hexavalent chromium) with exemptions.

Total limit @ 2.0 grams/vehicle of Cr+6 for corrosion protection purpose only; 0.0 gram for any other application in June 2003

Requirements for the re-use and recovery at vehicle end-of-life.

Achieve re-use and recyclability of at least 85% average vehicle weight by 2005 with greater percentages for 2015

Improve recycled content.

End-of-Life disposition information

End of Life Vehicles Directive

85 % re-use / recovery 80 % re-use / recycling

95 % re-use / recovery 85 % re-use / recycling

2000 2005 2010Year 20151/20077/2002 7/2003

New Vehicles

Vehicle Population

95 % re-useable / recoverable

85 % re-useable / recyclable

delivery to treatment facility with no cost for last holder and/or owner

delivery to treatment facility with no cost for last holder and/or owner

End-of-Life VehiclesTreatment:Targets to be achieved

2006

provision of dismantling information

TypeApproval

free from lead, mercury, cadmium and chromium VI (exemptions listed in Annex II)

End of Life Vehicles Directive

2000 2002 2006

IMDS: One CertificationProcedure for the Industry

End of Life Vehicles Directive

OEM

ProductOwner

Material Composition Information

Gather Info Supplier

Supplier

Supplier

SupplierProductOwner

Tier 1Tier 2

Gather Info Supplier

Supplier

Supplier

Supplier

Material Composition Information

IMDS provides a common method for identifying materials, substances and attributes

Suppliers proactively send material composition information

IMDS manages aggregated data sent forward through the supply chain.

Gather Info Supplier

Supplier

Supplier

Supplier

Material Composition Information

ProductOwner

Tier 3

Collect Material Account Data

EU Material Content Directives

RoHS & WEEE

Waste Electrical & Electronic Equipment [Directive 2002/96/EC]

• Sets criteria for collection, treatment, recycling and recovery of waste electrical and electronic equipment

• Makes Producers Responsible – Transport from collection facilities– Financially responsible for treatment, recovery and

disposal– Households/Final Holders and Distributors of

WEEE can return such equipment free of charge• Recovery Targets Set for Collection from Households

• Facilitates dismantling and recycling of waste electrical and electronic equipment by restricting use of hazardous substances in manufacturing

• Lead, mercury, cadmium, hexavalent chromium, PBBs and PBDEs banned by July 2006

Restriction on Use of Certain Hazardous Substances in EEE [RoHS] [Directive 2002/95/EC]

Categories of Electrical and Electronic Equipment Covered by WEEE Directive

1. Large household appliances2. Small household appliances3. IT and telecommunications equipment4. Consumer equipment5. Lighting equipment6. Electrical and electronic tools (with the exception of large-

scale stationary industrial tools)7. Toys, leisure and sports equipment8. Medical devices (with the exception of all implanted and

infected products)9. Monitoring and control instruments10. Automatic dispensers

WEEE Directive - requirements

1. Register with each EU country

2. Finance for your obliged allocation of WEEE:

– Separate collection

– Recycling

– Treatment / Recovery

3. Provide information to recycling/treatment facilities

4. Report evidence of proper management

5. Report evidence that targets have been met

6. Ensure marking of equipment MUST have been ready by August 13, 2005

Sensata Products Affected by WEEE & RoHS

As with the Automotive OEMs, the electronic OEMs, because the obligation to demonstrate conformance rests with the OEMs, they have developed a variety of mechanisms for obtaining conformance data of their supply chains.

A supplier is obligated to utilize whatever mechanism provided by OEM: Simple and Complex Certification Statements EIA/EICTA/JGPSSI Tool Web-based tools (such as IMDS in auto industry)

Reporting Requirements

Component Description76118-2 base cap76199-1 cap seal

28924-1 disc seat

28780-1 converter28714-2 washer

37660-1 formed disc28817-2 Hexport28925-1 insulator

28814-1diaphragm

bonded46705-3 USCAR Base76144-1 o-ring

28931-1 gasket76096-1 silicone seal

InsulatorSupplier

DiaphragmSupplier

O-ring, GasketSupplier

Silicone SealSupplier

Base MaterialSupplier

Cap MaterialSupplier

Disc MaterialSupplier

Converter/WasherSupplier

HexportSupplier

Product Product Material Breakdown Query Suppliers

7AM

Collect Material Account Data

Product Information Bill of Materials defines the parts that need to be

included in Material Content Breakdown For each part:

Weights to 0.05 grams Surface Areas to 0.1 cm2 Identification of the material of construction

Suppliers/Venders of materials of construction provide elemental breakdown of their materials.

Use of “jokers” allowable if confirmation that none of the prohibited/regulated materials are contained in undesignated portion.

Reporting Requirements

7AM Full Material Content Breakdown

Hexavalent Chromium

Material Content Breakdown

Cadmium

7AM

Material Content Breakdown

7AM

Monovalent Chromium

Material Content Breakdown

7AM applicable directive: RoHS 7AM contains no Mercury or Lead Polyester resin contains no restricted fire retardants. Monovalent and Trivalent Chromium are not restricted

by RoHS and are allowable at any concentration.

NOTE: Both Monovalent and Trivalent Chromium are on the Material Declaration Datasheet as reportable substances.

Material Content Breakdown

7AM applicable directive: RoHS Hexavalent Chromium:

RoHS limit for “unintentional incorporated” hexavalent chromium is 1.0 wt%. Hexavalent chromium is intentionally incorporated.

RoHS limit for “intentional incorporated” hexavalent chromium is 0.1 wt%. The wt% in 7AM is 0.003% -- which means that the chromating surface conforms to the RoHS limit.

In most cases, hexavalent chromium coatings specified by Sensata will not exceed this limit. Hard or decorative chromium plates will likely exceed.

Material Content Breakdown

7AM applicable directive: RoHS Cadmium:

RoHS limit for “unintentional incorporation” is 0.1 wt%. The cadmium contained in this device is intentionally incorporated.

RoHS limit for “intentional incorporation” (proposed) is 0.01 wt% of homogeneous material. The cadmium contained in contact material is much greater.

In 1976, EU passed an exemption allowing cadmium in contacts in electromechanical safety devices (Regulation 76/69/EEC)

The material content prohibition of RoHS superceded this exemption – although S&C submitted a request in Sept. 2002 to have this exemption added in the list of exemptions in RoHS.

The original design of is 7AM device did not conform to RoHS because of cadmium content of contacts.

Communicated to customer via following RoHS Declaration (or using tool required of customer)

Product Redesigned to meet RoHS Requirement

Material Content Breakdown

Individual MaterialContent Declarations

Supplier Management

Supplier Management Program

• Customers specifically acknowledge all of the

compliance information provided in this survey

is accurate and complies with Directive

2002/96/EC on Waste Electrical and Electronic

Equipment (WEEE), Directive 2003/108/EC

amending Directive 2002/96/EC on Waste

Electrical and Electronic Equipment (WEEE)

and Directive 2002/95/EC on the Restriction of

the Use of Certain Hazardous Substances in

Electrical and Electronic Equipment (RoHS).

• Should any components/parts you supply

become non-compliant with the WEEE/RoHS

Directives you will immediately notify, via

email, the Sensata Technolgies WEEE/RoHS

Compliance Officer

Supplier Management Program

Supplier Management Program

• 1,921 IMDS Entries Since Inception– 3.8 – 7.6 Man Years of Effort– Small Percentage of Possible Product Variation

• 2CP15-16– 37 Components– 6 Entries

• 7AM– 6 Components– 6 Entries

• Responded to 165 ELV, RoHS & WEEE Requests YTD 2006– 66 Product Certification letters– Complete 99 IMDS Entries YTD

• 1142 Sensata Suppliers– 636 Control’s Suppliers– 506 Sensor’s Suppliers

Supplier Management Program

Final Words The Automotive Manufacturers response to the End-

of-Life Vehicle directive provides one model for responding to the WEEE and RoHS directives.

Other industry sectors are investigating models for obtaining data similar product content data (electronics, white goods, aerospace).

Impacted industries are likely to extend the requirements of the EC directives to all of their products.

Regardless of the ultimate response model, the collection and management of Material Content Data within every company is a key task.

Final Words Collecting Material Content Data is a cross-functional

task and takes time for a company to learn: Even if your company isn’t yet impacted by material

content reporting requirements, it is worthwhile to begin collecting content data about your products (starting with Cr+6, Hg, Pb, Cd).

Level of effort necessary to collect data can be significant.

Be in front of the curve when material content reporting requirements for your industry arrive.

Changing product material content takes time/effort. Begin looking for technology platforms that avoid use of materials prohibited by the directives.

Global View

Regulatory Drivers

Japan Pb standards have been in place and electronics manufacturers have already responded

Pending EU Directives: REACH, IPP, Battery Revision

Piecemeal state laws(California SB 20/50, Maine, Ontario)

China has RoHS and is preparing WEEE legislation

Current EU Directives: WEEE, RoHS, ELV, EuP Battery, Packaging

Valuable Links

European Environmental Agency

http://www.eea.eu.int/

The EU on-line

http://europa.eu.int/index_en.htm

EU Directives – Legislative Summaries

http://europa.eu.int/scadplus/leg/en/s15000.htm