Methods Development
Papers Presented for This Session
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Developing Country-Specific Impact Procedures: Human Health and Ecosystem Quality as Criteria for Resource Quality and Availability
(abstract / slides as pdf )

Alan C. Brent
University of Pretoria, South Africa


Limitations of Consequential LCA
(abstract / slides as pdf )

Tomas Ekvall
Department of Energy Conversion, Chalmers University of Technology


Bridging the Gap - Sustainable Business Decision Making Using Total Cost Assessment
(abstract / slides as pdf )

Thomas Gloria, ICF Consulting
Gregory A. Norris, Sylvatica / Harvard University


Choice of Valuation Methods in LCA: End Users' Perspective
(abstract / slides as pdf )

Shirish Sangle, National Institute of Industrial Engineering


Abstracts for Session: Methods Development

 

DEVELOPING COUNTRY-SPECIFIC IMPACT PROCEDURES:
HUMAN HEALTH AND ECOSYSTEM QUALITY AS
CRITERIA FOR RESOURCE QUALITY AND AVAILABILITY

Alan C. Brent
Chair: Life Cycle Engineering
Department of Innovation and Technology Management
School of Engineering, University of Pretoria, South Africa
abrent@eng.up.ac.za

Within the South African context, existing life cycle impact analysis (LCIA) procedures that are commonly used have limitations in terms of resource depletion, ecosystem quality, evaluation of region-specific impacts, and normalisation and weighting.

A proposed impact analysis procedure for South Africa is shown, indicating potential impact categories and a mechanism to apply the distance-to-target method for normalisation and weighting of midpoint categories. It is proposed that these midpoint categories address water, land and air as resources together with the conventional abiotic resources.

An analysis of the availability of sufficient data is presented to apply the procedure to midpoint categories when assessing water, land, air and abiotic resources for South Africa. The analysis includes the conservation and environmental strategies of the South African government, which is based on scientific studies and will be used to stipulate targets for the relevant midpoint categories. The current impact levels are determined from the degree of natural transformation in a specific region.

The water catchments of South Africa are currently grouped into 18 eco-regions, consisting of specific vegetation types. Societal activity in the regions will have distinct ecosystem quality impacts as the biodiversity situation for the different eco-regions varies and needs to be taken into account. Four life cycle regions are proposed, that represent these catchments, eco-regions and vegetation types. The proposed normalisation and weighting procedures for the midpoint categories relate to these life cycle regions.

Parameters are briefly discussed to weigh the resource categories to obtain a final score. These parameters, however, are still in development.


LIMITATIONS OF CONSEQUENTIAL LCA

Tomas Ekvall, Department of Energy Conversion, Chalmers University of Technology, Sweden; e-mail tomas.ekvall@entek.chalmers.se


In this presentation, I distinguish between attributional and consequential life cycle assessment (LCA). An attributional LCA aims at describing the environmental properties of a life cycle and its subsystems. A consequential LCA aims at describing the effects of changes within the life cycle. Similar distinctions, but with different names, have been made by several LCA researchers. It has been argued that, at least in theory, consequential LCA is superior because decision-makers need to be informed about the consequences of decisions [1]. The aim of this presentation is to investigate the validity of this view through a discussion on the limitations of consequential LCA.
Although consequential LCA aims at describing effects of changes, it has severe limitations concerning the completeness as well as the accuracy. The effects of changes depend on economic mechanisms, that consequential LCAs only begin to model [2-3]. Dynamic optimising models [4], partial equilibrium models [5], and general equilibrium models [6] might prove useful to make the models more accurate and complete. But because of data gaps and the inherent uncertainty of future developments, decisions will always have to be made based on incomplete knowledge of their consequences.
If the accuracy and completeness of consequential LCAs are significantly improved, the information generated in such studies may still not always be sufficient or even relevant to decision-makers. Consequential LCA results, which reflect the effects of individual actions, can in some cases be perceived as unfair. A decision-maker may also feel responsible not only for the consequences of her actions but also for being associated with environmentally poor systems. In both of these cases, attributional LCA methodology may be perceived to give more relevant information. Furthermore, a general methodological rule that LCA results should reflect effects of actions can, in some instances, reduce the likelihood of future, environmentally good systems.
It cannot be concluded, from this discussion, that attributional LCA is superior to consequential LCA. However, the arguments presented here indicate that it is possible to defend the existence of attributional LCA methodology, alongside of consequential methodology, not only from a practical but also from a theoretical standpoint.
References:
[1] Curran MA, Mann M, Norris G. Report on the International Workshop on Electricity Data for Life Cycle Inventories. Cincinnati, Ohio 45268 USA, October 23 - 25, 2001.
[2] Weidema BP, Frees N, Nielsen A-M. Marginal Production Technologies for Life Cycle Inventories. Int. J. LCA 1999;4(1):48-56.
[3] Ekvall T. A Market-Based Approach to Allocation at Open-Loop Recycling, Resources. Conservation and Recycling 2000;29(1-2):91-109.
[4] Mattsson N, Unger T, Ekvall T. Effects of perturbations in a dynamic system - The case of Nordic power production. Manuscript in preparation.
[5] Bouman M, Heijungs R, van der Voet E, van den Bergh JCJM, Huppes G. Material flows and economic models: an analytical comparison of SFA, LCA and partial equilibrium models. Ecological Economics 2000;32:195-216.
[6] Ibenholt K. Materials flow analysis and economic modelling, In: Ayres RU, Ayres LW, editors. Handbook of Industrial Ecology. Cheltenham: Edward Elgar, 2002:17


BRIDGING THE GAP - SUSTAINABLE BUSINESS DECISION MAKING
USING TOTAL COST ASSESSMENT

Thomas Gloria, PhD.

ICF Consulting
Acorn Park, Cambridge, MA 02140-2390
ph:(617) 498-6204
fax: (617) 498-7020
email: tgloria@icfconsulting.com

Gregory A. Norris
Sylvatica / Harvard University
147 Bauneg Hill Road
North Berwick, ME 03906
USA
Norris@sylvatica.com

Sustainable development requires an integration of three methods of analysis that have previously been separate: capital investment evaluation, environmental life cycle assessment, and strategic environmental scenario risk analysis. Precisely this integration has been accomplished as the result of a multi-year project involving the participation and input of a consortium of multinational corporations to develop a Total Cost Assessment (TCA) methodology. This presentation will demonstrate how full-scale, standard methods of LCA can and have been tightly, logically, and practically integrated with standard methods for cost accounting, life cycle cost analysis, and scenario-based economic risk modeling. The result is an ability to take both economic and environmental performance - and their tradeoff relationships - into account in business strategic and capital investment decision making. The presentation will describe the methodology and illustrate its use by companies. Total Cost Assessment has already begun to impact the real-world investment decisions of some Fortune 100 companies by bringing previously ignored environmental risk & sustainability factors into the scope of corporate management's view.


Choice of Valuation Methods in LCA: End Users' Perspective

Shirish Sangle
National Institute of Industrial Engineering, Vihar Lake, Powai, Mumbai-400087
Tel: +91-22-857 3371, Fax: +91-22-857 3251, Email: shirishsangle@faculty.nitie.edu

Goal and Scope
Life cycle assessment helps to take decisions and does not decide for decision makers. However, these decisions largely depend upon how well one can associate life cycle inventory results into environmental impacts and the valuation of environmental impacts. In any decision making process, unless the outcome is obvious, weights needs to be attributed to the impacts according to their relative importance. This is a highly subjective and controversial process. There is variety of valuation methods present in the literature; each has its own strengths and weaknesses. However, the suitability of these methods in different decision making situations is little reported. A little literature is available about the applicability of some valuation methods in the context of nations. But, no specific guidelines are available as to which valuation method is suitable for a particular type of decision. The paper attempts to suggest use of valuation methods based on their suitability for decisions to be taken by different users.

LCA user identification and generic decisions to be taken by decision makers with the help of LCA studies are vital for selection of valuation methods in LCA. Accordingly, the paper discusses major LCA user groups viz. industry, consumer/consumer organizations, and public bodies; and major product, market, investment and strategy oriented decisions. The suitability of major valuation methods viz. monetary methods, sustainability levels, modelling of eventual effects, and societal approach is assessed for each user group for all the four decision areas. Studying general decisions made by each user group and assessing suitability for each valuation method accomplish this.

The selection of valuation method in LCA depends upon two factors (i) who is users of LCA viz. industry, consumer organization, public bodies and (ii) the type of decisions viz. product, market, investment, and strategy oriented decisions. So, it is quite possible that for a product related decisions each user may opt to chose different valuation method. Therefore, the LCA results must be interpreted with a great care and this reinforce only one point that LCA doesn't decide for the decision maker but only helps you to take decisions. Hence, for all practical purposes one may have to rely on mix of valuation methods to arrive at different types of decisions.

Although the selection of a valuation method may vary with user group's objectives, in broad term it is possible to produce a rank order for a valuation methodology. Further, it is desirable to have clear guidance on the selection of valuation methods for different LCA user groups. Inclusion of such guidance on valuation methods in all the major LCA software will be particularly helpful.

Key words: Life Cycle Assessment, LCA users, Decision areas, and Valuation.