Life-cycle Management Lecturers: Ingo Gestring Summer School 2016 ŠKODA AUTO University Mladá Boleslav Czech Republic

Lecture Content Fundamentals of Life-cycle Management Life-cycle Assessment for Environmental Management Life-cycle Costing Example for LCA And LCC: Steam iron Conclusions

Learning Outcomes After the lecture you should be able to: Explain the benefits of life-cycle management (LCM) Name different LCM concepts Apply LCM to different products Explain the context of LCM and environmental management in terms of Life-cycle Assessment (LCA) Analyse the different costs of Life-cycle Costing (LCC) Give examples for the discussed concepts

Example of a Life-cycle Muscular strength Age

Fundamentals of Life-cycle Management “A comprehensive approach towards product and origination related environmental management tools that follow a life-cycle perspective.” Fava (1998) “Life cycle management is a business management approach that can be used by all types of business (and other organizations) to improve their products and thus the sustainability performance of the companies and associated value chains.” UNEP/SETAC (2009) “… a systematic integration of life cycle thinking in modern business practice with the aim of providing the societies with more sustainable goods and services and to manage the total lifecycle’s of an organisation’s product portfolio towards more sustainable production and consumption” Jensen (2012)

Strategy, Systems, Concepts, Tools, Data Life Cycle Management Remmen et al. (2007)

Flow Concept - Linear Raw materials (Input: ressources, output: emissions Production Use + Maintenance Disosal Cradle to gate Gate to gate Gate to grave Cradle to grave

Flow Concept - Cyclical Cradle to cradle process Remmen A, Münster M. An introduction to Life-Cycle Thinking and Management. Environmental News, no. 68, Danish Environmental Protection Agency, Ministry of Environment (2003)

Mobile Phone Life-cycle UNEP/SETAC (2009)

System Functional System Input State variable Output System: physical, biological, technical or social Example Input System State variable System: natural ressource (oil) Input: exploration rate State variable: remaining quantity Output ressource (refined oil) Output

Life-cycle of Crude Oil Production Start 1850 Peak 2011 End 2056 (still 40 years) Time

Product Life-cycle Crude oil production Time Introduction Growt Maturity Decline What is missing? Development, disposal+recycling+recovery Time

Life-cycle Assessment Definition LCA “compilation and evaluation of the inputs, outputs and the potential environmental impacts of a product system throughout its life-cycle” Environmental management – Life-cycle assessment – Principles and framework (ISO 14040:2006)

Life-cycle Assessment LCA can assist in: identifying opportunities to improve the environmental performance of products at various points in their life cycle, informing decision-makers in industry, government or non-government organizations (e.g. for the purpose of strategic planning, priority setting, product or process design or redesign), the selection of relevant indicators of environmental performance, including measurement techniques marketing (e.g. implementing an eco-labelling scheme, making an environmental claim, or producing an environmental product declaration).

LCA Framework ISO 14040 (2006)

Product System for LCA ISO 14040 (2006) 3.12 elementary flow material or energy entering the system being studied that has been drawn from the environment without previous human transformation, or material or energy leaving the system being studied that is released into the environment without subsequent human transformation ISO 14040 (2006)

Environmental Impact Bhatia and Ranganathan (2004)

Environmental Impact 4 PHASES Development Production + distribution Use + maintenance Disposal + recycling Environmental impact Extra Blatt Time

Measurement of the Environmental Impact Direct KPI Emissions to Land 9. Pesticides and Fertilisers Emissions to Air 10. Metal Emissions to Land 1. Greenhouse Gases 11. Acids and Organic Pollutants 2. Acid Rain, Eutrophication and Smog Precursors 12. Waste (Landfill, Incinerated and Recycled) 3. Dust and Particles 13. Radioactive Waste 4. Ozone Depleting Substances Resource Use 5. Volatile Organic Compounds 14. Water Use and Abstraction 6. Metal Emissions to Air 15.Natural Gas Emissions to Water 16. Oil 7. Nutrients and Organic Pollutants 17. Metals 8. Metal Emissions to Water 18. Coal 19. Minerals 20. Aggregates 21. Forestry 22. Agriculture Environmental Key Performance Indicators (2006) www.defra.gov.uk

Reports for Environmental Impact AADP CML 2001 EDIP 2003 Impact 2002+ New impacts ILCD recommendation ReCiPe TRACI 2.1 UBP 2013 USEtox Eco-Indicator 99 PE LCIA Survey 2012 (Weighting) IPCC AR5 TRUCOST Natural Capital Accounting global coefficients Environmental Priority Strategies (EPS) VERY COMPLEX AND TIME CONSUMING

Life-cycle Costing Traditional life-cycle costing (LCC) is a method of calculating the total cost of a product (goods and services) generated throughout its life-cycle from its acquisition to its disposal, including design, installation, operation, maintenance and recycling/disposal, etc. Environmental LCC extends traditional LCC – it assesses all costs associated with a product’s life-cycle that are covered by one or more of the actors in the product’s life cycle. These actors include suppliers, manufacturers, customers, end-users or end-of-life actors.

Life-cycle Costing UNEP/SETAC (2009)

LCC - LCA Costs Env. Impact LCC LCA

Example for LCA und LCC: Steam iron Eco-label for climate protection Conditions for the label

PROSA - Product Sustainability Assessment …is a method for the strategic analysis and evaluation of product portfolios, products and services. The goal is to identify system innovations and options for action towards sustainable development. PROSA structures the decision-making processes that this requires, reducing complexity to key elements. Important fields of application include strategic planning and product portfolio analysis in companies, product policy and dialogue processes, sustainable consumption and product evaluation as well as product development and marketing.

LCA Steam Iron Production Use + Maintenance Disposal + Recycling Development Not considered Basic for the calculation: Materials used Plastic (38 % by weight) Metal (48 % by weight) Other (14 % by weight) Basic for the calculation: 6 year life cycle 6 times for 30 min in use =>3 h/week 250 Wh per 30 min No maintenance Basic for the calculation: Plastics are burned metals are recycled

LCA Steam Iron Process Data collection Environmental Impact Simulation Production Use + Maintenance Disposal + Recycling Simulation Energy Consumption [MJ/year] Global Warming Potential GWP [kg CO2e/year] Calculation Energy consumption Simulation

LCA Environmental Impact Process Energy consumption GWP Phase MJ/year kg CO2e/year Production 25 (3%) 1,9 (2,6%) Use 756 (96,6%) 44,88 (97%) Disposal 4,81 (0,6%) 0,5 (1,1%) Credit 4,86 (-0,6%) -0,29 (-0,6%) Sum 780 46,3

LCC Steam Iron Production Use + maintenance Disposal + Recycling Development Not considered Not Considered! Costs are covered by the company, Allocation is difficult View of consumer! Invest: 60€ 6 years in use Energy consumption: 75 kWh/year Price for kWh 0.26 € Not Considered! Costs are covered by the company

LCC Environmental Impact Type Invest Energy Total costs Steam iron Phase MJ/year kg CO2e/year Production 25 (3%) 1,9 (2,6%) Use 756 (96,6%) 44,88 (97%) Disposal 4,81 (0,6%) 0,5 (1,1%) Credit 4,86 (-0,6%) -0,29 (-0,6%) Sum 780 46,3

Conclusions Life cycle management can be used to gain profits and to reduce the environmental impact of products and services LCM consists of: strategy, systems, concepts, tools, data Life cycle assessment and Life cycle costing are parts of LCM Doing a holistic LMA is time consuming, a lot of data are needed Different KPI and aggregated KPI are used to indicate the environmental impact The allocation of costs and environmental factors to a single product is diffcult

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