Comparative Life Cycle Assessment of polymer vs. paper bank notes

Heather Jackson Bank of Canada Coppelia Marincovic PE International, Inc.

Bank of Canada Comparative LCA of polymer vs. paper bank notes LCA XI conference, October 2011

1. Background, goals & challenges 2. Scope of the project 3. Results and conclusions 4. Reactions to the study

Bank of Canada Comparative LCA of polymer vs. paper bank notes LCA XI conference, October 2011

1. Background, goals & challenges 2. Scope of the project 3. Results and conclusions 4. Reactions to the study

Bank of Canada Comparative LCA of polymer vs. paper bank notes LCA XI conference, October 2011

Background

The Bank of Canada, Canada’s central bank, is issuing a new series of bank notes starting in 2011 Major change Cotton-based paper to polypropylene substrate Distinctly different design (clear window areas) Different supply chain Increased longevity in circulation

10.10.2011

4

New designs considerations

Current Design - Paper

Resistance to counterfeiting Cost Production process capability Environmental impact

New Design - Polymer 10.10.2011

5

Goals of the study

Evaluate the environmental impacts of producing and distributing Canadian bank notes based on two different substrates – cotton�based paper vs. polymer Identify substances of concern whether in the form of bank note components or emissions arising from bank note production Reveal those aspects of banknote production and distribution that could be targeted to further reduce environmental impact Follow ISO standard Life Cycle Assessment procedures

10.10.2011

6

Challenges

Confidentiality Bank note manufacturers and suppliers are necessarily secretive about materials and processes Central banks do not divulge bank note details Worldwide supply chain Two supply chains (paper and polymer) Defining “representative data” “Comparative assertion” Simplifying model for bank note distribution and use phases

10.10.2011

7

1. Background, goals & challenges 2. Scope of the project 3. Results and conclusions 4. Reactions to the study

Bank of Canada Comparative LCA of polymer vs. paper bank notes LCA XI conference, October 2011

Scope of the study

Functional Unit: “Provision of $2,000 (CDN) of cash value over a time span of 7.5 years�

Paper bank note

Lifetime (years)

Weight (kg/100 bank notes)

Reference flow

3

0.102

250 pieces of 20 CAD bank notes (2000/20*7.5/3)

Polymer bank note

7.5

0.093

100 pieces of 20 CAD bank notes (2000/20 *7.5/7.5)

Time coverage: 2009 (current), projected based on 2009 tests (new) Geographical coverage: Canada (distribution/use/EoL), specific countries for production Data sources: Primary data from suppliers whenever possible, otherwise from available databases and literature Background data: GaBi database Allocation: mass Environmental Indicators: Primary Energy Demand, Global Warming Potential, Eutrophication Potential, Acidification Potential, Smog Potential, USETox, Ozone Depletion Potential Deliverable: ISO compliant LCA report 10.10.2011

9

System overview

Resources (materials and energy resources)

Foil Cotton production Foil Thread Ink Plates

Polymer production

Thread Paper production

Polymer conversion

Foil

Bank note printing

Bank note printing

Ink

Distribution

Distribution

Use

Use

End of Life

End of Life

Plates

Printing

Bank note

Emissions to air, discharges to water and soil 10.10.2011

10

Scope of the study

Bank note life cycle step

Representativeness

Data source

Cotton paper production

100%

Supplier (primary data)

Polymer substrate production

100%

Supplier (primary data)

Foil production

100%

Supplier (primary data)

Thread production

100%

Supplier (primary data)

Thread conversion

100%

Supplier (primary data)

Printing

100%

Supplier (primary data)

Ink production

100%

Supplier (primary data)

Distribution logistics

100%

Bank of Canada (primary data)

Armored cars

100%

Contractor (primary data)

Use phase

n/a

Bank notes equipment manufacturers (primary data)

End of Life - landfills

57%

Contractor (primary data)

10.10.2011

11

1. Background, goals & challenges 2. Scope of the project 3. Results and conclusions 4. Reactions to the study

Bank of Canada Comparative LCA of polymer vs. paper bank notes LCA XI conference, October 2011

High level results All life cycle steps included

0.0%

20.0%

40.0%

60.0%

CML2001 - Nov. 09, Global Warming Potential (GWP 100 years) [kg CO2-Equiv.]

69.5%

Primary energy from resources (net cal. value) [MJ]

61.1%

TRACI, Acidification Air [mol H+ Equiv.]

TRACI, Ozone Depletion Air [kg CFC 11Equiv.]

TRACI, Smog Air [kg NOx-Equiv.]

USETox2008, Ecotoxicity [PAF m3.day] USETox2008, Human toxicity [cases]

10.10.2011

100.0%

67.3%

Primary energy from renewable raw materials (net cal. value) [MJ]

TRACI, Eutrophication (Air & Water) [kg NEquiv.]

80.0%

Current Design

New Design

71.7% 40.0% 55.2% 61.0% 62.9% 69.1% 13

Detailed results for the LC phases

Manufacturing

Primary energy TRACI, Primary from TRACI, TRACI, Ozone energy renewable Global TRACI, Depletion Eutrophica Acidificatio from Warming raw tion Smog Air n Air Air resources materials Potential

0%

10.10.2011

10%

current

4%

new

4%

current

5%

new current new current

20%

40%

50%

60%

70%

80%

90%

100%

43% 44%

52% 52% 59%

3%

34%

23%

34%

5%

43%

52%

17%

52% 40%

14%

36%

24%

24%

7%

new

End of Life

43%

20%

6%

new

new

Use

53%

current

current

30%

17%

new

current

Distribution

64% 26%

5%

29% 58%

22%

29%

36% 36% 14

Sensitivity analysis - lifetime

120%

Base scenario: 100% = current design (lifetime = 3 years) 100% 80% 60% 40% 20% 0%

Current New design New design New design New design New design New design New design New design design (3 (3 years) (4 years) (5 years) (6 years) (7 years) (8 years) (9 years) (10 years) years) CML2001 - Nov. 09, Global Warming Potential (GWP 100 years) [kg CO2-Equiv.]

Primary energy from renewable raw materials (net cal. value) [MJ]

Primary energy from resources (net cal. value) [MJ]

TRACI, Acidification Air [mol H+ Equiv.]

TRACI, Eutrophication (Air & Water) [kg N-Equiv.]

TRACI, Ozone Depletion Air [kg CFC 11-Equiv.]

TRACI, Smog Air [kg NOx-Equiv.]

USETox2008, Ecotoxicity [PAF m3.day]

USETox2008, Human toxicity [cases] 10.10.2011

15

Conclusions

The new design (based on a polymer substrate) shows benefits over the current design (based on a cotton paper substrate) because of: Manufacturing: increased lifetime ďƒ lower overall impact (even if the manufacturing of the polymer bank note has a higher environmental impact) Distribution: - polymer bank note has to be transported 2.5 less times than the cotton paper bank notes (less transport of fresh notes to the system, and fewer unfit bank notes sent back to the banking system) - weight of the polymer bank note is lighter; shipments are limited by value and not weight, then a lighter weight ďƒ environmental benefit over time End-of-life: the polymer is mostly made of inactive carbon, which in contrary to cotton paper, does not contribute to GHG emissions in landfill.

10.10.2011

16

1. Background, goals & challenges 2. Scope of the project 3. Results and conclusions 4. Reactions to the study

Bank of Canada Comparative LCA of polymer vs. paper bank notes LCA XI conference, October 2011

Reactions to results

Internally at the Bank of Canada Surprised by dominance of the transportation distances, ATM power usage Critical Review Panel gave insightful feedback External reactions Suppliers appreciated the thoroughness of the study

Full report published on the Bank of Canada website (June 20, 2011) http://www.bankofcanada.ca/banknotes/bank-note-series/polymer/life-cycle-assessment-lca/

10.10.2011

18

Questions?

Heather Jackson Bank of Canada hjackson@bank-banque-canada.ca

Coppelia Marincovic PE International, Inc. c.marincovic@pe-international.com

Bank of Canada Comparative LCA of polymer vs. paper bank notes LCA XI conference, October 2011