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The economy constantly needs new and smarter approaches and tools to steer our consumption in a more sustainable direction. The EU is also driving the transition to a circular economy through a wide range of regulations. In the future, almost all products entering the EU market will be required by law to have a DPP.
Sitra has been supporting companies through the upcoming change by funding DPP experiments and the lessons learned have now been compiled in a working paper. According to this, Europe can learn a lot from the Finnish pilot projects in developing DPP solutions.
The working paper presents the results of four Finnish pilot projects to support future EU regulation and the development of new business models.
What is a Digital Product Passport?
The DPP is an EU technology concept that compiles product data from the entire manufacturing and production chain. This includes information on raw materials, product safety, use and recyclability.
In practice, DPPs are the so-called digital version of a physical object. DPPs provide accurate and reliable information about a product throughout its manufacturing and distribution history.
Supply chain transparency aims to promote sustainable design and production, enable the transition to a circular economy, create new business opportunities for companies and help consumers make sustainable choices.
Data drives growth in textile repair products and services
Finnish outdoor clothing manufacturer Halti’s pilot project aimed to understand the digital capabilities required to implement a DPP from the perspective of a textile company and the financial investment required.
In another experiment, Struggle Creative explored the use of blockchain technology as the basis for a decentralised infrastructure for DPPs in the textile industry.
The textile sector is under constant scrutiny for its significant emissions and the DPP for the sector is part of the EU’s 2030 vision for sustainable and circular textiles. The aim is that all textile products sold in the EU should be durable, repairable and recyclable into new raw materials.
DPPs can encourage textile recycling and the emergence of new circular economy business models, such as repair services and products. The challenge is how consumers can easily compare the DPPs of different products and manufacturers, and how all the data can be organised in a functional way in a complex supply chain, during the use of garments and when consumers discard them.
Visibility of transport emissions from food and steel products
The DPP gives consumers accurate information not only about the manufacturing process, but also about the carbon footprint of the product during transport. A joint pilot between steel company SSAB, food company Orkla and consultancy PBI Research Institute tested the measurement, exchange and storage of emissions data from the transport chain. Orkla’s frozen food and SSAB’s industrial steel products transported by road and sea were selected as example products.
Transporting products with zero emissions can create opportunities for companies to gain a competitive advantage. Companies therefore benefit when the carbon footprint of raw materials can be demonstrated along the value chain up to the final product. For consumers and business customers, the zero emission of products provides incentives for making sustainable choices.
The trials revealed that consumers, businesses and investors have very different needs for DPPs and that different perspectives should be taken into account in the regulatory work and in the development of DPPs.
New life for machine tool batteries with data
In a battery DPP trial with Nordic machine manufacturers Sandvik and Kalmar, a battery DPP was developed for batteries used in machinery in ports and mines. The trial tested how the data provided by the DPP can help industrial operators calculate and reduce emissions.
DPP data can be used to improve the maintenance, recycling and reuse of machinery batteries, thereby extending their life cycle. When a battery is no longer suitable for use in machinery, information on its condition can help make it available for new uses, such as energy storage.
The pilot showed that the introduction of DPPs requires new services to facilitate data sharing, such as data brokerage services. Access to data also requires new solutions and needs to be improved so that different stakeholders in the value chain can acquire and use the data.
The regulation of DPPs in the EU is progressing in stages. The new battery regulation will enter into force as early as 2024 and will make the product passport for batteries mandatory.
Businesses need examples and peer support to use DPPs
Some companies in different sectors are already making effective use of data and are looking forward to the future DPP regulation, while others are in the early stages. Based on the lessons learnt from the pilots, Sitra recommends that the Commission and member states should support European industries and businesses to prepare for future regulation.
According to Laura Halenius, project manager at Sitra, DPPs are a big change for businesses. To accelerate the uptake of DPPs, Sitra proposes investing in product development and supporting pilot projects and peer networks. “Sitra is also funding the FINNPASS network, where Finnish operators exchange information on DPP development and share their know-how. There is a huge need for companies to learn more about the topic and to hear about the progress of others,” says Halenius.
The EU also needs open test platforms and pilot environments so that companies can test different solutions for sharing product passport data. In the Finnish DPP pilots, a free public test environment was an important platform for data transfer and collaboration between organisations.
“Companies need to understand the benefits of DPPs. It’s important to identify industry-specific use cases for DPPs that are particularly relevant to the transition to a circular economy and that companies are already prepared to implement,” says Halenius.
Read more
- Sitra’s pilot projects: Digital product passports
- Sitra’s proposal to the European Commission for the continuation of the Green Development Agenda (2023): Putting nature at the heart of the European Green Deal – Building blocks for the next European Commission
