1. Example zFirm that cleans used metal parts

2. Measure Baseline Waste Generation New solvent Waste disposal Fugitive emissions CLEANING PROCESS 4,000 gallons 3,950 gallons 50 gallons

3. Measure Baseline Costs zInput solvent y$3.50/gallon × 4,000 = $14,000 per year zWaste disposal y$2.50/gallon × 3,950 = $9,875 per year

4. Assumptions z5% inflation rate zReal price increase for solvent of 1% annually zReal price increase for disposal of 4% annually zDiscount rate of 6%

5. Baseline Costs YearAnnual Cost Inflation 5%+ real price increases PV (using 6%) 123875 2 25603.7524154.50 32387527462.8924441.87 42387529462.6424737.4 52387531614.0525041.29 62387533929.0725353.77 72387536420.6325675.11 82387539102.7126005.54 92387541990.4326345.31 102387545100.1526694.71 total 252324.00

6. Identify Options z1. Recycle solvent z2. Use non-hazardous cleaning method

7. Measure Waste Generation for Option 1 New solvent RECYCLE Fugitive emissions CLEANING PROCESS 360 gallons 3,950 gallons 50 gallons Waste disposal 3,640 gallons 310 gallons

8. Measure Benefits Option 1 zNo change in production of output, so no revenue change for output zNo revenue from recycled solvent because it is used rather than sold.

9. Measure Costs Option 1 zInvestment Expense ($66,500) y $40,500 Tanks, pumps, mixers y $20,000 Installation (design, piping, labor) y $6,000 Contingency zOperating Expense y $240 Utilities y $5,000 Operations labor y $3,325 Maintenance y $1,260 New solvent (360gallons @ $3.50 per gallon) y $775 Waste disposal (310 gallons @ $2.50 per gallon) y$120 for training $8,565

10. Assumptions z10 year equipment life, no salvage value zStraight-line annual depreciation (divide capital cost by 10) zCost of capital is 12% annually for 3 year equal payments z5% inflation rate zReal price increase for solvent of 1% annually zReal price increase for disposal of 4% annually zDiscount rate of 6%

11. Measure Waste Generation for Option 2 New solvent Non- hazardous waste disposal to sewer CLEANING PROCESS 4,000 gallons 4000 gallons

12. Assumptions z5% inflation rate zWaste solvent can be sewered at negligible cost zDiscount rate of 6%

13. z4000 gallons solvent at $4.60/gallon. z$120 for training Measure Costs Option 2

14. Outcome? zComparing recycling to current practice, would save $81,317.23 over 10 years zComparing material substitution to current practice, would save $75,702.02 over 10 years

15. What is Life Cycle Analysis? zA tool to understand environmental impacts associated with products, processes, and activities zLCA is a systems approach to evaluating environmental consequences of a product or process zIt takes a “cradle to grave” or “cradle to cradle” perspective. zA systematic set of procedures for examining the environmental impacts of a product or service throughout its life cycle

16. Applications zAlternative Fuels/energy sources zAlternative materials (Aluminum vs. Steel body, Asphalt vs. concrete, wood vs. brick zAlternative processes (Corn-biomass ethanol) zAlternative products (cloth diapers vs. disposable diapers) zAlternative packaging (cans vs. tetra-packs) zAlternative end of life management options (recycle, incinerate, dispose) zEnvironmental, economic tradeoffs