FEATURE
and are most vocal in promoting nominally “green” solutions. However, there are many smaller specialist manufacturers around the world which in their own niche product areas are able to play an important role in introducing “green” initiatives. Since an important element of trying to make wire and cable “greener” is innovation, those companies prepared to commit resources in R&D are going to be at the forefront of this movement, rather than just the large manufacturers. WJI: What products most lend themself to a “greener” image? Will customers support higher prices (margins) for products that are “greener” and go beyond the specs? Daniels: As has been noted, wire and cable is generally incorporated in a finished product. If the producer of this finished product, be it a building or “If you have set yourself a domestic appliance or a telecom- up to be a volume munications netlowest-cost producer of work, sees an advantage in using standard cable products, “greener” cable then there is currently that supports a higher cost, then it no real need to invest in is possible to the development of have success new ‘green’ products.” with a product that exceeds specification. If, for example, you are building a luxury apartment, it could be a selling point that the cabling is all “green” such as low-smoke, zero-halogen, even if building regulations don’t require it to be, and so this could justify paying a higher price. However, if you are building an ordinary house, then having “green” wiring is probably not a selling point and the cable used will be the cheapest that meets specification. So again it’s a case of working with your customers to achieve an end product which can carry a premium for “greenness.” While the general public may be willing to pay more for a product which is judged to be “greener,” companies are much less likely to do so. WJI: Is “green” likely to become more of a factor? To what degree does this depend on its being required by mandates/codes/directives? Daniels: “Green” is definitely becoming more of an issue, but the initiatives are currently mostly closely aligned to sound business sense. If the wire and cable industry is to make big steps towards being “greener” then we believe that this is often tied into changes in mandates/codes/directives/regulations. For example reduced smoke and toxic gas emission cables generally only started to be used when they became compulsory as a result of changes in regulation. This does though present cable companies with an opportunity. If a company is closely involved with the formulation of these new regu-
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lations then it can gain at the very least a short term advantage over its competitors. WJI: Can cable manufacturers choose to avoid investing in products that are greener? Daniels: If you have set yourself up to be a volume lowest-cost producer of standard cable products, then there is currently no real need to invest in the development of new “green” products. When these are developed by other companies and then grow to take a large part of the market it is generally fairly easy for this low-cost manufacturer to introduce this new type to its range at this stage. WJI: If a customer asked CRU to estimate the potential value of “green” to the wire and cable industry, what would you say? Daniels: Inevitably it really depends on your definition of “green.” If you define this as demand for wire and cable from developments such as renewable energy generation, then this is already a significant driver of demand in a number of areas. The cables being used are not in themselves inherently “green,” as most are of a standard design, but, for example, the development of renewable energy generation and the wider impact this will have on transmission and distribution systems is potentially very important for the cable industry. If you apply a much more strict definition of “green” as a wire and cable designed solely to have less impact on the environment in its own right then the value would be much less. In general it’s fair to say that “green” issues don’t feature very highly in requests for work that CRU has been receiving in the last few years. The practicality of doing such a study would depend entirely on the scope of work, but in theory it should be possible to try and quantify the potential return on a “green” investment.
WJI: How would you sum up where the wire and cable industry sits in the whole “green” world? Daniels: In summary, the cable industry is not really currently at the forefront of “green” thinking, with the majority of the so called initiatives simply driven by normal business development. If the cable industry wants to really make a difference, then it needs to work more closely together and with its customers, and invest more in innovation to come up with solutions which can have a genuine impact. Wire and cable is used almost everywhere so there is clearly potential for this industry to make a significant contribution to the whole “green” movement.