Finding your way in multifunctional processes and recycling
Since the beginning of LCA, there has been a major issue on which we will probably never reach a consensus: how to deal with multifunctional processes and recycling. This article tries to explain the concepts underlying this issue.
No one true way
Allocation is dividing the input or output flows of a process between the product system that is under study and other product systems. Because there is no obvious solution to many impact allocation problems, the ISO standards for life cycle assessment leave a large degree of freedom, and they can be interpreted in many ways. For the problems of recycling and multifunctional processes, there are also multiple good points of view, as you’ll understand after reading this article.
This flexibility has led to different approaches, such as the British PAS2050 for carbon footprinting, the Greenhouse Gas (GHG) Protocol, the International EPD System, and the Product Environmental Footprint (PEF) methodology.
LCI data providers also have different views on how to deal with these issues. For example, the Agri-footprint database is available in three versions with three different allocation keys to divide the upstream burdens of multifunctional processes between the co-products. The ecoinvent data is also available in three different versions, based on very diverse approaches.
Important concepts in LCA
This article gives an overview of the different options for approaching multifunctional processes and recycling by describing the relevant concepts in both.
Dealing with multi-functional processes:
In instances where multi-functional processes occur (i.e. processes or facilities providing more than one function), all inputs and emissions associated with the process need to be partitioned between the multiple goods and/or services. The following concepts are important to understand when deciding how to deal with multi-functionality:
- The consequential approach
- 1.1 System expansion
- The attributional approach
- 2.1 Physical allocation
- 2.2 Economic allocation
- 2.3 Allocation at the point of substitution
- End-of-life allocation
- 3.1 Recycled content or cut-off approach
- 3.2 Closed-loop scenarios
- 3.3 Circular Footprint Formula (CFF)
1. The consequential approach
The consequential approach to multifunctionality is probably the most theoretically correct model to deal with multifunctional processes and recycling. It’s also the first in the hierarchy prescribed by ISO14044 and ISO14067. In practice, however, you need to make a lot of assumptions about the so-called avoided burdens. This consequential approach to multifunctionality is often called the substitution approach, system expansion, or avoiding allocation.
Let’s take beer as an example. The life cycle of a can of beer includes co-production of straw (from growing barley) and spent grains (from brewing the beer). Straw and spent grains can be used as animal feed, and their co-production means the impact of producing other sources of animal feed is avoided. After the beer is consumed, recycling the beer can means the impact of virgin aluminium production is avoided.
The consequential approach forces users to make assumptions about quality: do the other sources of animal feed have the same function/quality as the straw and spent grains? And does recycled aluminium have the same quality as virgin aluminium? If you assume the answer is yes, you can include the avoided burdens in the system according to the consequential approach.
2. Attributional approach
If you want to avoid having to make such assumptions and concentrate on the life cycle of the beer can itself, you can choose an attributional approach. An attributional approach assigns a certain environmental impact to the product. However, this approach is not free of arbitrary choices either. In the case of multifunctional processes, you first need to classify the outputs as waste, recyclable material, or marketable co-products. Then you need to determine an allocation factor for the marketable products. This is often done using physical allocation, economic allocation, or allocation at the point of substitution (APOS).
The difference between the consequential- and attributional approach is depicted in the following image.
2.1 Physical allocation
The first type of allocation of the attributional approach is physical allocation. It assigns an allocation factor using physical characteristics, such as (dry) mass, volume, exergy content, energy content, and energy input associated with each co-product (or by-product, if the other product is unintentional or unwanted). Physical allocation can be more suited for some situations rather than others. For example:
- The beer cans are transported together with other beverages. You may divide the burdens related to transport by the relative volume of each type of beverage in the truck. This makes sense because the weight of the cans directly impacts the emissions during transport,
- Spent grains are a by-product of beer brewing. If you were to allocate by mass, it would mean that about 15% of the burden of beer brewing is allocated to the spent grains. The revenue for brewers from this by-product is almost negligible compared to the revenue from the beer, so allocating such a large share of the burden to the spent grains would give an unfair advantage to the environmental footprint of the beer.
2.2 Economic allocation
As seen above, physical allocation can be considered unfair for users of the lower-valued by-products. To prevent this unfairness, it is not uncommon to use the price of the product and co- or by-products to calculate the allocation factors. This is economic allocation.
Some examples where economic allocation makes more sense:
- Cultivation involving by-products (e.g., in the example above with spent grains and beer)
- Animal slaughtering and their co-products (e.g., wool, meat and hides from sheep farming)
- Mining for valuable materials (e.g., mining for gold but simultaneously extracting high quantities of lower-value materials)
Although prices are often confidential and volatile, solutions can be found. To avoid communicating the real prices, for example, you can use average prices over several years and divide them by the price of the main product.
2.3 Allocation at the point of substitution (APOS)
Spent grains are not a typical by-product, because they are available in different forms, depending on dry matter percentage. Straight from the brewing process, spent grains are rather wet and have very little market value. You could therefore choose to not allocate any burdens to the wet spent grains and only attribute the burdens from drying the spent grains.
Alternatively, you could include the drying of the spent grains in the brewing process and allocate the burdens at the point that the production of spent grains could potentially avoid the burdens of producing alternative animal feed. This way, the beer also carries some burden from drying the spent grains and the spent grains carry some burden from beer brewing.
This complex approach is called allocation ‘at the point of substitution’ and can be selected as an option in ecoinvent. It has some theoretical advantages, but in practice, it is very complex and sometimes leads to strange results. For example, if you partly allocate the burdens from recycling the used cans into aluminium for new cans to the production of a can of beer, and the burdens from brewing beer to the recycled aluminium, you could end up with a higher impact score for the recycled aluminium than its virgin equivalent. If you use this approach, you need to check if the results make sense compared to the simpler and more conventional allocation approach.
3. Dealing with recycling (i.e. end-of-life allocation)
Recycling materials can also be seen as a multi-functional process: one function is to treat the waste, and the other function is to produce a new secondary material. So, we also need an approach to manage its multifunctionality. Is it Life Cycle 1 or Life Cycle 2 that gets allocated the benefit and burden of the recycling process? This is often called end-of-life allocation.
These are some of the most common approaches for end-of-life allocation:
- Recycled content or cut-off approach
- Closed-loop scenarios
- Circular Footprint Formula (CFF)
3.1 Recycled content or cut-off approach
The most common approach for situations like the wet spent grains and used aluminium cans is the recycled content or cut-off approach. This model allocates burdens at the point where a product is sold and applies a cut-off at the point the recyclable material leaves the product system. So, the wet spent grains are sold for a negligible price and no burdens from brewing are allocated to them. Similarly, the recycled aluminium from the used cans carries the burden from the point that they were collected for recycling.
The image below depicts the recycled content or cut-off approach. The system is cut-off at the wet spent grains (all burdens for drying are allocated to the grains, not to the production of a can of beer) and at the disposal of the can (all the burdens of disposing are allocated to the can, not to the production of a can of beer). The input for the can production consists of both recycled and virgin aluminium, which are both taken up in this system.
3.2 Closed-loop approximation
But what if there is a great demand for recycled aluminium, there is limited supply in your country, and you use relatively little recycled aluminium because of the limited availability at the production site? If you would use the recycled content approach, your beer cans would get a large burden from using virgin aluminium, while the used cans are almost all collected for making new beverage cans. In such situations, several LCA and carbon footprint specifications allow you to apply a closed-loop scenario. This means that you assume that all the cans that were recycled will be used for the same purpose again. The percentage of recycled aluminium for making the cans is assumed to be equal to the percentage of cans that is recycled at the end of the beer can’s life. So, the burdens of recycling the can are allocated to the production of a can of beer (inside the system) and the same amount of recycled aluminium is used as an input for the can production (a lower burden for can production because more recycled material is used).
The problem with this approach is that it is not always easy to see when the closed-loop scenario applies. How do you determine whether the market for a recycled material is saturated? There is a high demand, for example, for cardboard to create the cartons around beer cans, but there is also a large supply of recycled cardboard. In this scenario for cardboard, closed-loop approximation would not be accurate.
3.3 The Circular Footprint Formula
The Circular Footprint Formula (CFF) is a method which has been published by the European Commission in its PEF and OEF methodologies which intends to integrate aspects of different end-of-life allocation approaches, in combination with material- and market-specific characteristics (such as material degradation and country-specific recycling rates). The formula splits the benefits and burdens of recycling (material recovery) between the producer using recycled input material and the producer of the product that was recycled. This means that when recycled material is used, a certain amount of the benefits and burdens of the recycling process is attributed to the product that uses this recycled content. Similarly, when material is disposed of, a portion of the benefits and burdens of recycling and energy recovery processes are also attributed to the product. When material is disposed of through landfill or incineration without energy recovery, the burdens are attributed solely to the product.
Accepting different choices
We need to accept that we disagree on which allocation method and recycling formula should be applied. The international EPD system and PAS2050 recommend using a simple cut-off and the Dutch Handbook on LCA recommends a cut-off with economic allocation. PEF recommends using a decision hierarchy, where subdivision or system expansion are favored, followed by allocation. The GHG protocol, ISO and a wide variety of other organizations allow the choice between various methods. Read more about this in this report.
The bottom line is: all these approaches are correct in their own way. All you can do is decide which point of view makes most sense for your situation, and choose accordingly.
This article was originally written by Tommie Ponsioen. He worked for PRé as a Technical Consultant from 2012 until 2015 as a part of the Consultancy Team.
Humanity’s impact on the planet is no longer sustainable, however, we are living in an exciting period with the opportunity to make a change. While making sustainable decisions is often complex, I hope to bring clarity and reasoning to these discussions with the power of quantitative analysis. I’m passionate about helping clients make sustainable changes most efficiently with the maximum impact.
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