A new method is available in the SimaPro 9.0 release: Environmental Prices. This method expresses the external costs of one additional unit of pollution in money and results in midpoint characterisation factors that can be used for single-score exercises in life cycle assessment (LCA). Read on to learn the basics of Environmental Prices, or check out the full Environmental Prices Handbook by CE Delft.
By Katarzyna Cenian, Analyst at PRé Sustainability
Linking impact to money
To be able to calculate the price of pollution, you need to connect impact assessment models and economic models such as social cost-benefit analysis. This is exactly what the researchers from CE Delft did.
Combining these methods allowed them to derive factors for pollutants with impacts on human health and ecosystems, initially for a group of fifteen, and allocate them to impact categories based on ReCiPe 2008. Then, CE Delft expanded the list of factors to almost all substances covered by ReCiPe.
Using Environmental Prices in LCA
The Environmental Prices method was developed at three levels: pollutant level (per substance), midpoint level (per impact category) and endpoint level (per damage category). The outcome is beneficial for both the LCA and business worlds – LCA gains weighting sets based on monetisation and businesses can now use economic valuation for more types of pollutants.
All factors except climate change are based on ReCiPe 2008, which means midpoint prices are only compatible with that version of ReCiPe. Environmental Prices cannot be integrated with other impact assessment methods. In addition, Environmental Prices does not give midpoint values for resource consumption (fossil fuels, metals, water), because the market price of these resources already reflects scarcity considerations to a certain extent. It is important to keep geographical and temporal scope in mind when using Environmental Prices, because prices are only valid for the Netherlands or the EU-28 and are based on 2015 figures.
The price tag of your impacts
Single-score methods make study outcomes easier to digest, and expressing a result in monetary units brings additional advantages. Money is a more intuitive and practical metric in the business world than, for instance, disability-adjusted life years (DALY) or species.yr. Looking beyond single products, Environmental Prices can be applied to an Environmental Profit and Loss account (EP&L) for the entire company and its supply chain. An EP&L helps highlight the most important aspects for improvement across the impact categories, can be compared to the financial results of the enterprise and can be used for monitoring the impacts each year.
Would you like to try Environmental Prices and see how making pollution tangible in terms of money can help you communicate? Upgrade to SimaPro 9.0 and get started today!