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Enhancing the economic dimension of LCA + DEA studies for sustainability assessment D. Iribarren, M. Martín-Gamboa Systems Analysis Unit Instituto IMDEA Energía

CONTENTS 1. Introduction 2. Method 3. Results and discussion 4. Conclusions

1. Introduction General context  Sustainable development : Development that meets the needs of the present without compromising the ability of future generations to meet their own needs.  Eco-efficiency : Delivery of competitively priced goods that satisfy human needs while progressively reducing environmental impacts of goods and resource intensity throughout the entire life cycle to a level at least in line with the Earth’s estimated carrying capacity. Need for integrative methodological approaches for sustainability assessment and benchmarking

1. Introduction Methodological context  Life Cycle Assessment (LCA): Methodology for assessing the environmental aspects and potential impacts associated with a product by compiling an inventory of relevant inputs and outputs of a product system, evaluating the potential environmental impacts associated with those inputs and outputs and interpreting the results of the inventory analysis and impact assessment phases in relation to the objectives of the study.  DEA : Linear programming methodology to measure the relative efficiency of multiple decision-making units (DMUs) when the productive process shows a structure that is composed of multiple inputs and outputs. Input 1 Output 1 … … DMU Input X Output Y

2. Method Five-step LCA + DEA method STEP 2 Life cycle Life Cycle Impact inventory data Environmental Assessment benchmarks Current STEP 4 Material and environmental Life Cycle Impact energy flows profiles STEP 1 Assessment Data Collection STEP 5 Socio-economic Interpretation Efficiency aspects scores Operational benchmarks STEP 3 Sustainability outcome Data Envelopment Selected data Analysis Socio-economic benchmarks Acknowledged need for further efforts to improve the economic dimension of the assessment

3. Results and discussion Straightforward strategies (I) STEP 2 Life cycle Life Cycle Impact inventory data Environmental Assessment benchmarks Current STEP 4 Material and environmental Life Cycle Impact energy flows profiles STEP 1 Assessment Data Collection STEP 5 Socio-economic Efficiency Interpretation aspects scores Operational benchmarks STEP 3 Sustainability (a) Direct economic outcome Data Envelopment savings Selected data Analysis Socio-economic benchmarks

3. Results and discussion Straightforward strategies (II) STEP 2 Life cycle Life Cycle Impact inventory data Environmental Assessment benchmarks Current STEP 4 Material and environmental Life Cycle Impact energy flows profiles STEP 1 Assessment STEP 5 Data Collection Economic (b) Life Cycle Interpretation Socio-economic Efficiency benchmarks Costing aspects scores Operational benchmarks Sustainability STEP 3 outcome Data Envelopment Selected data Analysis Socio-economic benchmarks

3. Results and discussion Indirect strategies (I) (c) External costs reduction STEP 2 Life cycle Life Cycle Impact inventory data Environmental Assessment benchmarks Current STEP 4 Material and environmental Life Cycle Impact energy flows profiles STEP 1 Assessment STEP 5 Data Collection Interpretation Socio-economic Efficiency aspects scores Operational benchmarks Sustainability STEP 3 outcome Data Envelopment Selected data Analysis Socio-economic benchmarks

3. Results and discussion Indirect strategies (II) STEP 1 Data collection Life cycle inventory of each current DMU STEP 2 Emergy Analysis Emergy indicators of each current DMU DEA output(s) STEP 3 Data Envelopment Analysis Efficiency scores Emergy of current DMUs benchmarks Savings in emergy-dollars

4. Conclusions  The enhancement of the economic dimension of the LCA + DEA methodology for sustainability assessment is feasible .  Straightforward and indirect strategies to attain this methodological improvement can be devised.  The choice of the most appropriate strategy or set of strategies depends on the specific case study and on user requirements.  The implementation of these pathways into the LCA + DEA methodology is expected to boost its use for sustainability assessment , dealing with environmental, economic and social aspects in balance.

Enhancing the economic dimension of LCA + DEA studies for sustainability assessment D. Iribarren, M. Martín-Gamboa Systems Analysis Unit Instituto IMDEA Energía