Greening the Supply Chain

Chris McNeillCommodity Manager - Special Processes

PW/UTC Aerospace

Massachusetts Metal Finishing Forum5/20/04

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COMMERCIAL ENGINE

SMALL ENGINES

LARGE MILITARY ENGINES

P&W SPACE PROPULSION AFTERMARET SERVICES

Why is Greening the Supply Chain Important to Us?

UTC EH&S Policy StatementGrowing pressure from:

customersregulatorsadvocacy groupsshareholdersinvestors

Expanding definitions of liability and risksGreen Engine Program designed to take life cycle approachSupplier rationalization and strategic sourcing70-80% of our parts are made by suppliersGood EH&S practices drive down costs and help preventbusiness interruptionsWaste = $$$$$To understand the impact of our products through their life cycle we must understand our suppliers better.

EH&S risks have shifted off-site and beyond direct control

Suppliers

P&W

P&W

Suppliers

Pre-1990s: Manufacturing works with EH&S on large risks/ opportunities

Today: Procurement works with Green Engine Program on large risks and opportunities

Greening the Supply Chain Concept

Collaborate with UTC’s suppliers worldwide

Focus on improving business performance

Identify potential opportunities to improve both supplier and UTC’s operating, financial and EH&S performance

Focus on avoiding business riskAt a minimum, to encourage compliance with local

applicable EH&S regulations and laws

Has lowest possibleNoise Impact

Has the lowest possible Emission Impact during use

Designed with Human Factors

in mind

Material Efficient (Metal Buy-to-fly,Propellant Yield )

Manufactured inGreen Factories

Involves Green Suppliers and Partners

Designed for Serviceability, Reusability, Recyclability

Energy Efficient during use (Fuel Burn)

Life-Cycle Assessments Looked at Impact on People, Environment & Natural Resource UseLife-Cycle Assessments Looked at Impact on People, Environment & Natural Resource Use

Contains Green Materials

Limit MOC’s Maintained with Green Overhaul and

Repair Processes

Elements of a Green Engine

MINING & METAL RESIDUES FROM A SINGLE JET ENGINE MINING & METAL RESIDUES FROM A SINGLE JET ENGINE IS 100:1IS 100:1

10 Million Pounds Ore(1% metal content)

100,000 Pounds Metal(forgings and bar stock)

10,000 Pound Engine

100 10 1

Materials of Concern (MOC)Prohibited Restricted To be Reduced

Arsenic & compoundsAsbestosBenzeneBerylliumCadmium & compoundsChlorinated solventsEthyl alcoholEthylene glycol ether compoundsFormaldehydeMercury & compoundsMethanol (methyl alcohol)Methylene chlorideClass I ozone depleting substancesRadioactive materials, including Thoriated (TD) nickelToluene diisocyanate

Chromium, hexavalentClass II ODSCyanides DimethylformamideHCFC-14 lb & HCFC-22HydrazineHydrofluoric acidHydrogen fluoride gasLead & compoundsManmade fibers, e.g., cristobalite, fiberfraxMDA (4’, 4’-Methylenedianiline)Methyl alcohol (methanol)Methyl ethyl ketone (MEK, 2-butanone)Methyl iso-butyl ketone (MIBK, 4-methyl-2-pentanone)PhenolStyreneTolueneXylene

AcetoneAmmoniaButyl alcoholEthyl benzenen-HexaneHydrochloric acidIsocyanatesn-methyl-2-pyrrolidoneIsopropyl alcoholNickel plateNitric acidPetroleum distillates (e.g., naptha, mineral spirits, stoddard solvent, varsol, evaporative lubricants)Phosphoric acidSec-butyl alcoholSulfuric acid1, 2, 4-Trimethylbenzene

Hazardous Materials and Processes Index

• Defines “greenness” of products by assigning “hazard” values to materials & processes

Ih = Tn*Pn/D

where: Ih = Hazardous Material Index (P&W Wide)N = number of specification in the designT = toxicity value of specification (Purdue

Rankings)P = number of part numbers that call out

specificationD = total number of part numbers in engine

N

n=1

Product Hazmat ComparisonsGas Turbine Design Progression

0

5

10

15

20

25

Haz

ard

ou

s M

ate

rial

s In

dex

70’s Design

80’s design

New Designs

90’s Design

SolventsPbCNCrCd

22.4

8.04

3.80

15.2

Commercial EnginesStatus & Opportunities

0

2

4

6

8

10

12

14

16

18

Cadmium HexavalentChromium

Cyanide Lead Solvents

% O

f P

/Ns

70’sDesign

80’s Design

90’s Design

New Design

P&W Proprietary - Subject to restrictions on the title page8D Conf Breakout

April 4, 2002

Lead-freeAntigallants

o

ChromiumAnodizingAlternative

Sulfuric AcidFor Non-Porous

Structures;Sulfuric-Boric

For FatigueSensitive Parts

Hard Coatings toReplace Chrome

HVOF,Nickel-Tungsten

Non-chromate PrimersAlternates to

Other Primers Qualified;Alternate to

Adhesive Bonding Primer

Non-chromateConversion

CoatingsTrivalent Chrome

Conversion Coating

Cadmium PlateAlternatives

Advanced Diffused Coatings

Xylene/TolueneReplacements Material/Process Repair

TechnologiesAdvanced Stripping

Technologies

• •

Green FactoryClosed LoopTechnologies

Current Technology Initiatives

Lead-Free, Non-Silver Dry Film Lubricants

For Fasteners

Green Supply Chain Objectives

Encourage suppliers to develop sound environmentalmanagement systems

Facilitate the sharing of best practices

Work with suppliers to get superior green technologiesImplemented that will reduce cost, improve quality and reduce turn-time.

Transfer Pollution Prevention Technologies

What has been done?Green Supply chain

Suppliers Join UTC Employees at Annual EH&S Technical Conference

 

70 to 80% of the parts in a gas turbine engine are procured. UTC can examine its own portion, but it must examine the environmental impact of external manufacturing as well. This obligates us to share information and technology with our supplier partners. There is no silver bullet solution. This is a long-term commitment.”

32 suppliers attended poster sessions, panel discussions and technical break out sessions on:

• Designing for the environment• UTC international EH&S regulations• Reducing waste with “out of the box” thinking {Link to Brian Quillia’s VIX presentations}• Forensic root cause investigation (Dr. Lee)• Energy and water conservation• Effective ergonomic practices – Reducing Injuries by 60 percent• Launching EH&S programs• Integrating acquired operations• Model of health and productivity• P&W Chases Green by Going Green• Leveraging Supplier Partnerships to improve EH&S performance

 

What has been done?Green Supply chain

•EMS Training – One day overview of EMS ElementsHeld in Connecticut35 attendeesCo-sponsored by UTC, Pratt & Whitney, U.S. EPA Region One

From the participants we solicited (6) companies willing to commit to 9 month EMS Roundtable at UTC Leadership Center in CT. EMS training completed 12/03EMS Training – One day overview of EMS Elements

Held in Maine30 attendeesCo-sponsored by UTC, Pratt & Whitney, U.S. EPA Region One, Maine DEP

From the participants we solicited companies willing to commit to 6 month EMS Roundtable at PW North Berwick Maine facility

 

 What has been done?Green Supply chain

Pratt & Whitney Sponsors Industry-EPA Pollution Reduction Initiative

National Metal Finishing Strategic Goals Program BOSTON - The U.S. Environmental Protection Agency and Pratt &Whitney announced today that the Connecticut company has become a corporate sponsor of an innovative industry-EPA program to reduce pollution from the metal finishing industry.  

“A key to our success has always been a group of talented, hard working suppliers. We can take a lead role in helping them improve their operations even more and, most importantly, reduce their environmental impact.” 

Provide information and expertise on how the suppliers can make progress towards the objectives of the Strategic Goals Program

Help facilitate development of environmental management systems at suppliers.

What has been done?Green Supply chain

Strategic Goals Meeting30 Suppliers attendedPresentations about:

Green Engine ProgramAcid Distillation ProjectsClosed Loop Chemical Processing LinesProactive Environmental Management Systems – A Supplier Perspective

What has been done?Green Supply chain

 The Lean & Clean Enterprise

Objectives• Eliminate or reduce all non-value added activities

– Shorten processing time– Improve productivity– Improve quality– Lower overall costs – Increase customer satisfaction

• Eliminate or reduce impact on the environment– Improve material efficiency– Lower energy demand– Decrease use of toxic and hazardous materials

What has been done?Green Supply chain

•Green Supplier Network – Aerospace

Longer term project Participants have included:

US EPA, G.E. Aero, Boeing, Raytheon, Lockheed Martin, Northrop Grumman Haas

TCM, UMASS, UTC, Pratt & Whitney, N.I.S.T., M.E.P., IMCO

Five common suppliers selected for pilot1 complete, supplier excited by opportunities

identified during Lean& Green event facilitated by Conn-Step

Focus – Lean & Green

Green Technology Development

Pratt & Whitney Materials Engineering has been doing R&D on a new surface treatment intended to replace NiCd plating on steel disks.

The new surface treatment is “green”We have partnered with a metal finishing supplier to complete process development, tooling development and scale up for production

It’s important to work with Key suppliers early in the green technology implementation process .

Green materials and processes are the vision but cost remains a reality

Green Technology Development

Suppliers play a key role with Pratt & Whitney products

Suppliers who do design and make must understand our hazardous materials concernsSuppliers must share information

It’s important to work with Key suppliers early in the green technology implementation process .

Change (internal and external)

Thousands of suppliers -- prioritization

Educating management to recognize the strategic valueof having suppliers with good environmental management practices in place.

Engaging suppliers in a discussion on improving their environmental performance.

Asking suppliers to spend $ to see cost reduction.

Making sure we start to engage suppliers early enough in the process of implementing green technologies

Challenges

“We should have to talk ourselves out of there being a problem, rather than talk ourselves into believing we have one.”

UTC Chairman George DavidEarth Technologies Forum, October 26, 1998

“We should have to talk ourselves out of there being a problem, rather than talk ourselves into believing we have one.”

UTC Chairman George DavidEarth Technologies Forum, October 26, 1998

UTC is Committed to Environmental Leadership in Our Products and Processes

Pre CAEP/2

CAEP/2

CAEP/4

CAEP/6 (est.)

Tougher NOx Regulations

EmissionsTougher Noise Regulations

Pre CAEP/2

CAEP/4

CAEP/6 (est.)

0

5,000

10,000

15,000

20,000

1992 1993 1994 1995 1996 1997 1998 1999 2000

0

5,000

10,000

15,000

20,000

1992 1993 1994 1995 1996 1997 1998 1999 2000

HazWaste

Noise