LCA and Input-Output Analysis: GDI Experience

Christopher WeberAsst. Research Professor, Green Design InstituteCarnegie Mellon University, Pittsburgh, PA USA

Outline Why Life Cycle? Driving feature: Greenhouse Gas Assessments Types of Life Cycle Assessment: strengths and weaknesses Process LCA Input-Output Analysis (IO-LCA) examples of different types of assessments from our lab

General thoughts on sustainability accounting for biofuels Summary

LCA in Decision-making: Why and why not? Recent interest in including life cycle info in policy and

decision-making LCA has much to offer for policy Comparative assessments can often only be done reasonably at

life cycle level (ex: corn ethanol) Supply chains are important for impacts of policy (ie,

implications of carbon pricing)

However . . . LCA is complicated! To compare between products, completeness, specificity, and

comparability all very important Uncertainty and variability—how to deal?

3

An example of the problem

Not including indirect land use change!

Farrell et al (2006) in Science

Policies involving Carbon Footprinting US and EU considering border tariffs on embodied CO2

as protection for heavy industry Low Carbon Fuel Standard (California) and Renewable

Fuels Standard (US, EISA 2007) Both contain standards written in life cycle terms, controversial Indirect Land Use Change (iLUC) particularly controversial

Carbon labeling taking hold in several markets Led by large retailers (W-M, Tesco) for consumer products in

US and UK Japan, Germany, Sweden, California have all considered

national/state policies All assume a single answer, no uncertainty/variability

The Big Driver: Greenhouse Gas Accounting aka carbon footprinting

Global GHG Emissions

Geographical Inventories by country

(UNFCCC)

Emissions by company (WRI/WBCSD)

Emissions by product (ISO, BSI,

WRI/WBCSD)

Project Accounting (CDM, WRI/WBCSD)

Current Happenings in Carbon Footprinting

New and Developing standards work PAS 2050—British Standards and Carbon Trust UK ISO 14025 series—standards for type III environmental

declarations WRI/WBCSD developing product and supply chain standards

(GDI highly involved)

Carbon Disclosure Project, Climate Registry, and voluntary markets continue to grow

EU ETS trading strong and current debates about phase III goals (20% RPS, 20% CO2 reduction by 2020)

Product Accounting LOTS of people working on this ISO 14044 series for LCA (more than just GHG) Carbon Trust/BSI: PAS 2050 ISO 14025: Environmental Product Declarations Coming ISO Standard on product accounting (2011) Now WRI/WBCSD GHG Protocol writing one ALL in addition to policy bodies (CARB, EPA, govts)

Overall, new standards look similar to ISO 14044 but more specific for GHGs

Product Accounting Issues System Boundary selection—use of PLCA vs. matrix

PCLA vs. HLCA Capital equipment accounting Allocation of co-products: attributional vs. consequential End of Life accounting—esp recycling Land Use Change—direct vs. indirect Uncertainty and Variability analysis—require? How? Primary vs. secondary data requirements Geographic and Temporal averaging

Types of LCAs: Strengths and Weaknesses in GDI’s experience

Types of Life Cycle Assessments What is purpose of Analysis? Tool use should depend on purpose of analysis LCA in policy, internal corporate use, public reporting, etc. all

require different levels of precision In any LCA, balance between primary data, secondary data, and

different levels of data quality

General Classes of Analyses Process LCA—ISO 14044, PAS 2050, etc. Input-output analysis—economic tool developed in 1950’s for

top-down economic modeling Hybrid LCA—Combination of strengths of both approaches

Advantages of Process vs. IO Conventional PLCA: Process and product specific Detailed improvement and scenario analysis Analysis of existing and future products Easy to link to functional unit

IOA Economy-wide impacts (complete system boundary) Publicly available data, reproducible results Data available on every commodity

Disadvantages of Process vs. IO Conventional PLCA: Subjective System Boundary Can take substantial time and money Proprietary data issues Substantial uncertainty in many numbers

IOA Aggregation Price uncertainty (linking to functional unit difficult) Data time issues (5 years to obtain typical) Uncertainty in data

In summary. . . Process LCA Advantages: Specific process-level data, functional units easy Disadvantages: Arbitrary System Boundaries, Proprietary data,

can take substantial time and money Typical uses: product footprints, phys/chem process analysis,

policy and disclosure-level comparisons Input-Output Analysis Advantages: Fast, Complete, can model product and social

impacts Disadvantages: Aggregation, Upfront learning, Functional units

difficult Typical uses: large-scale analyses of many products/services,

sustainable consumption research, structural economics

Current Hierarchy: GHGP Data Quality Tree

Examples and Experience in PLCA and IOA

Examples: GDI Process LCA

Electricity uncertainty in the US

Local CO2 –US CO2

SO2CO2

NOx

Examples: GDI Input-output analysis Total consumption by US households

0,0 1,0 2,0 3,0 4,0 5,0 6,0 7,0 8,0

Food/NalcBev

AlcBev,Tobacco

PrivateTransport

Housing

Furnish,Equip,Maint

Utilities

Rec/Culture

Mis Goods/Services

Clothing/Footwear

Communications

Health

Education

ton CO2e/cap-yr

DirectCO2

CO2

CH4

N2O

HFCs

Examples: GDI Input-output analysis Embodied CO2 in global trade: Annex B vs. non-B

Examples: GDI Input-output analysis Production and Consumption-based US Land use

Examples: GDI Hybrid LCA

LCA and IOA in biofuel sustainability assessment

Process LCA has the specificity necessary to analyze: Different production pathways Different feedstocks

IOA still may have something to offer Land use—huge issue in LCA/IOA today Socioeconomic impacts:

economic production related to infrastructure investment and policy decisions

Job creation

Both methods have strengths to exploit for sustainability analysis

Questions

Contact: clweber@cmu.edu