Green Life Cycle and Accounting
David M. Boje
October 23, 1999
What is a Green Life Cycle?
impacts along the entire continuum of a products life from raw material
extraction, through manufacturing, distribution and transportation, use,
recycle, and ultimately to final disposal.
What is Life Cycle Analysis? LCA is a systematic
cradle-to-grave analyses of production systems tool to estimate the environmental
consequences of alternative materials, designs, manufacturing processes,
product use patterns, and end of life alternatives. The assessment includes
the entire life cycle of the product, process or activity, encompassing,
extracting and processing raw materials; manufacturing, transportation
and distribution; use, re-use, maintenance; recycling, and final disposal.
The next LCA step is to conduct a life cycle impact assessment. The impact
assessment focuses on the potential environmental and human health impacts
associated with a given product system based on the life cycle inventory
results. Analysis of multiple environmental and resource issues (i.e.:
inputs and outputs). Final phase is an improvement analysis to evaluate
opportunities to reduce energy, material inputs, or environmental impacts
at each stage of the product life-cycle. After analysis comes implementation
What is Life Cycle Cost?
References on Life Cycle Cost
Inventory inputs and outputs
Evaluate LCA impacts associated with those
inputs and outputs on environment and health,
Interpreting the results/impact of the inventory
of inputs and outputs.
Quantify cost measures (energy, raw materials,
audits) and reporting formats.
Implement changes in processes, products,
Paper by Prof. Dr.-Ing. habil.
Prof. e.h. Dr. h.c. Hans-Jörg Bullinger, Dr.-Ing. Joachim Warschat,
Dipl.-Ing. Reinhold Bopp M.S., Dipl.-Ing. Kai Wörner M.Sc. "APPROACHES
TO PRODUCT LIFE-CYCLE COST ESTIMATION IN CONCURRENT ENGINEERING" (press
In order to calculate the life-cycle cost
of a product the design engineer has to take all product life phases into
account, such as manufacturing, assembly, use, service and recycling/diposal.
Article reviews verious engineering rpoduct
design software tools to account for recycling and other environemental
There is also a transorganiztional example,
project TOPROCO, the project consortium consists of two research institutes
from Germany and Belgium (IAT, WTCM), two recycling organisations (MANN,
GEP) from the UK and Germany, a Belgium software developer (SNI) and a
Greek appliance manufacturer (ELCO).
Quick Study Guide References
Life Cycle Cost and Energy Efficiency (press
Life Cycle Cost and Suppliers (press
Life Cycle Cost and Life Cycle Profit (press
Acquisition and modification of complex technical
equipment imply a lot of decisions to be made such as: selection of alternative
technical solutions, selection of suppliers, and dimensioning
Life Cycle Costs as a design variable (press
Life Cycle Cost Estimate (press
Netherlands - recommends:
* Describe which emissions will occur
and which raw materials are used during the life of a product. This is
usually referred to as the inventory step.
See Environmental Impact Assessment site - Has
many good links to international resources, research options, and methods
* Assess what the impacts of these emissions
and raw material depletions are. This is referred to as the evaluation
HOW TO BE SUCCESSFUL AT BEING GREEN?
Types of Management Decisions Benefiting from
Environmental Cost Information (Source: EPA 742-R-95-001 June, 1995)
? Quantify impacts/measure green costs and
? Environmental training in life cycle model
? Use less and buy better inputs
? Measure benefits and costs with environmental
? Open communication
? Integrate EA into the accounting system
? Senior management champions
Modeling Green Life Cycle Design for Products/Processes
Product Design Capital Investments
Process Design Cost Control
Facility Siting Waste Management
Purchasing Cost Allocation
Operational and Mix
Risk Management Product Pricing
1. Include environmental issues in needs analysis-
consider environmental costs and performance in defining scope of design
project- establish baseline environmental cost and performance
2. Add environmental requirements to design
3. Evaluate alternate design solutions taking
into account environmental cost, performance, cultural, and legal requirements
Bristol-Myers Squibb - Product
life cycle reviews form the cornerstone of BMS's prevention-based EHS activities
In 1992, BMS committed to completing Product Life Cycle reviews of all
major product lines by the end of 1997, establishing a company wide commitment
to leadership in EHS management. The teams participating in PLC reviews
were able to identify and reduce negative EHS impacts throughout all phases
of a product's life, from research to final disposal. The teams
also identified potential savings of more than $6.5 million in product
and process improvement opportunities, benefiting both the environment
and business. For Example:
Toxic chemical use reduction
in laboratories. Best Practices identified and eliminated 40%
of the types of toxic substances previously used, therefore reducing hazardous
chemical inventory and thus reducing employee exposure to toxic chemicals.
This has led to a reduction of toxic waste generation of 80% as well
as a reduction of laboratory cooling water use of 175 m3 per year.
Laboratory chemical costs have been reduced by $5,000 annually.
Reusable label bins.Collapsible,
pallet size, returnable bins were purchased to replace corrugated
cases for high volume infant formula paper labels. This has
resulted in a warehouse space saving of 60%. Furthermore, it has
eliminated the annual need of 20,000 corrugated shippers as well as eliminating
2,000 metal rings that had been incorporated into the product container.
Heating Ventilation Air Conditioning
(HVAC) condensate recovery.The HVAC system requires the periodic or
continuous removal of boiler water in order to control the buildup of dissolved
solids, thereby preventing scaling and water carryover. This process,
known as blowdown, involves the discharge of a controlled amount of high-solids
water to the sewer in order to control the dissolved solids level.
A sewer surcharge of $3.50/gallon is applied to any water that is discharged.
A process improvement was implemented which recovers condensate material
from the boiler water. This significantly reduces blowdown required
since the water has a significantly lower dissolved solids level.
This has resulted in cost savings of $20,000 to $50,000 in avoided sewer
surcharge costs. The improvement also eliminates the possibility
of a worst case scenario, which would be a discharge of seven million gallons
Hamaker, Joseph W. "TWO-STAGE-TWO-ORBIT:
A COST PERSPECTIVE." (press
here). Engineering Cost Office NASA Marshall Space Flight Center
Marshall Space Flight Center, AL 35812. This paper considers the possible
life-cycle costs of single-stage-to-orbit (SSTO) and two-stage-to-orbit
(TSTO) reusable launch vehicles (RLVís).
APPROACH - The life-cycle cost of any
launch system can be divided into four components:
Office of Codes and Standards (OCS)
U.S. Department of Energy
MANUFACTURER IMPACT ANALYSIS METHODOLOGY WORKSHOP FOR THE BALLAST ENERGY
EFFICIENCY STANDARDS RULEMAKING (April 28, 1998) (press
here for full report). Press
here for info on how to download spreadsheets and simulations for LCC
The cost of the
The fleet production
The cost of launch
The cost of operations
over the life cycle.
Single-stage-to-orbit (SSTO) and two-stage-to-orbit
(TSTO) reusable launch vehicles (RLVís).
Review the article to see how costs are
here). Focus on TABLE 3. Life-Cycle Cost Spreadsheet..
What does the Life Cycle Cost (LCC)
spreadsheet do? The LCC spreadsheet (currently LCC_v2.XLS) calculates
the life-cycle costs and payback periods of four ballast types: 2-lamp
F40T12/ES, 1-lamp F40T12/ES, 2-lamp F96T12/ES and 2- lamp F96T12HO/ES.
here to download Excel version of the Spreadsheet). You will need to
review some reports to get a sense of the data and its manipulations.
Clean Coal Technology Compendium -
This page features useful analytical tools to be applied to electric power
technology data from the Compendium and other sources. Each tool will have
instructions for use and a sample or default set of parameters installed.
Spreadsheet-based tools will be emphasized because of their ease-of-use
here) for spreadsheet downloads. Other resources (press
here for comparison of operating life of two types of lights.
here for comparison of different conversion scenarios.
here for Memo on Distribution of Green Lights ballasts vs. operating
hours, and Xenergy ballasts vs. operating hours Contains more
examples of figure one above.
here for Ballast Manufacturer Impact Analysis Analytical Approach Office
of Codes and Standards April 10, 1998
Ballast lifetime varies depending upon
the properties (components and manufacturing process) of a particular ballast
and on how it is installed and used (including fixture type) (press
NFESC Energy and Utilities Department
Energy Project Execution
Life Cycle Cost Spreadsheet for Submitting Energy Projects (press
The LCC spreadsheet will calculate the
life-cycle cost of a particular project. User supplied inputs include project
construction cost, category of project, and utility rates. The spreadsheet
will calculate the simple payback and the savings-to-investment ratio.
Life-cycle-cost analysis is required documentation when submitting a DD
Form 1391 application for energy funds. Get the LCC Spreadsheet press
Life Cycle Cost Case Study on Slides (press
here) for slide 1, (press
here) for slide 26, (press
here) for slide 27.
Press for TD Consulting Gameboard,
Green Accounting Gameboard
or Storytelling Organization Gameboard.