Life Cycle Assessment (LCA) explained

So, you have heard about life cycle assessment and how beneficial it is for sustainability in business. But how does that work exactly? How can a request for a report or an insight into your supply chain help your competitive position? And how would you get started with any of this?

This guide will give you an overview of how life cycle assessment works, what all the data is for and how to get started using LCA results to boost your competitive position and improve your company’s sustainability.

What is a life cycle assessment (LCA)?

Life cycle assessment (LCA) is the factual analysis of a product’s entire life cycle in terms of sustainability. Every part of a product’s life cycle – extraction of materials from the environment, the production of the product, the use phase and what happens to the product after it is no longer used – can have an impact on the environment in many ways. With LCA, you can evaluate the environmental impacts of your product or service from the very first to the very last or from cradle to grave.

Life cycle assessment stages

There are many benefits to LCA. Your LCA results can help you improve your product development, marketing, strategic planning and even policymaking. Consumers can learn how sustainable a product is. A purchasing department of a company can learn which suppliers have the most sustainable products and methods. And product designers can explore how their design choices affect the sustainability of the products.

Many types of LCA exist. Rule of thumb is that the more detail you want, the more complete your LCA needs to be. A report for internal use has fewer requirements than a report that will be used for marketing or other external communication. There are also many LCA-related assessments, such as Environmental Product Declarations (EPDs), studies compliant with a product- or sector-specific standards, single-issues analyses like the carbon or water footprint, social LCA and long-term monitoring studies. The interesting thing about a life cycle model is that you can use it to perform a variety of assessments; whatever matches best matches your business needs right now.

Four steps of life cycle assessment

LCA is a standardized methodology, which gives it its reliability and transparency. The standards are provided by the International Organisation for Standardisation (ISO) in ISO 14040 and 14044, and describe the four main phases of an LCA:

  1. Goal and scope definition
  2. Inventory analysis
  3. Impact assessment
  4. Interpretation

LCA is an iterative methodology, where you refine things as you go along. For instance, the first round of analysis may tell you that you need more data. Or the results of the assessment or your interpretation may nudge you to revise your goal and scope. In this sense, every LCA you do not only gives you valuable advice to make changes in your business, it also tells you how to best plan your next LCA to learn even more.

Step 1. LCA goal & scope definition

The goal & scope definition step ensures that your LCA is performed consistently.

An LCA models a product, service, or system life cycle. A model is a simplification of a complex reality and as with all simplifications, this means that the reality will be distorted in some way. The challenge for an LCA practitioner is to make sure the simplification and distortions do not influence the results too much. The best way to do this is to carefully define the goal and scope of the LCA study.

The goal and scope describe the most important choices, which are often subjective. For instance, the reason for executing the LCA, a precise definition of the product and its life cycle and a description of the system boundaries.

Step 2. Inventory analysis of extractions and emissions

In the inventory analysis, you look at all the environmental inputs and outputs associated with a product or service. An example of an environmental input – something you take out of the environment to put into the product’s life cycle –  is the use of raw materials and energy. Environmental outputs – which your product’s life cycle puts out into the environment – include the emission of pollutants and the waste streams. Together, this gives you the complete picture.

Step 3. Life cycle impact assessment (LCIA)

In the life cycle impact assessment (LCIA), you draw the conclusions that allow you to make better business decisions. You classify the environmental impacts, evaluate them by what is most important to your company, and translate them into environmental themes such as global warming or human health.

The most important choice you have to make is how integrated you want the results to be. Would you like a single score to show how sustainable your product is? Or to be able to see whether your new design improves on CO2 emissions and keeps land use change at least the same? This usually depends on how you would like to address your audience and the ability of your audience to understand detailed results.

Step 4. Interpretation

During the interpretation phase, you check that your conclusions are well-substantiated. The ISO 14044 standard describes a number of checks to test whether conclusions are adequately supported by the data and by the procedures you used. This way, you can share your results and improvement decisions with the world without any surprises. 

Life cycle assessment vs other methods

Life cycle studies can be performed for various scopes: cradle to gate (raw materials until factory gate), gate to gate (only focusing on the manufacturing processes) or cradle to grave (raw materials until disposal). What makes it different from other models is mainly its data-driven methodology. The two main other methods, cradle-to-cradle and the circular economy, are designed to capture the hearts of audiences. LCA is designed to capture the mind as well.

Cradle to cradle

The cradle-to-cradle certification system is about qualitative visions and storytelling, using qualitative criteria to judge whether a product can be certified. Criteria include material health, material reuse, renewable energy and carbon management, water stewardship and social fairness. The lowest score on these criteria becomes the product’s overall mark. In contrast to LCA, cradle to cradle does not measure whether a certified product actually has a lower overall environmental impact, so a cradle to cradle-certified product may end up having a shifted or even increased burden.

Circular economy

The circular economy is an inspirational strategy for creating value for the economy, society and business while minimizing resource use and environmental impacts through reducing, re-using and recycling. In contrast, life cycle assessment is a robust and science-based tool to measure the environmental impacts of products, services and business models with a sort of accountancy approach. Combine both the robustness of the LCA methodology and the inspirational principles of circular economy and you have a holistic approach for innovation.

LCA software

Searching for LCA software solutions? Our flagship product, SimaPro, has been the world’s leading LCA and sustainability software for 30 years. It is trusted by industry and academics in more than 80 countries. 

With SimaPro, you can:

  • Determine KPI’s to measure sustainability
  • Analyse your sustainability performance with life cycle assessment
  • Identify the hotspots in every link of your supply chain, from extraction of raw materials to manufacturing, distribution, use, and disposal
  • Communicate clearly through fact-based sustainability reports
  • Generate compliant environmental product declarations
  • And much more

Contact us to learn more about LCA

Do you want to find out how the LCA methodology can help you reach your environmental business goals? Find out how we can assist you and let our consultants help you get started!

Laura Golsteijn

Senior Consultant

I am eager to increase the environmental awareness of our society, and I believe that everyone can contribute to a more sustainable world, every day. At PRé we provide companies with both the knowledge and the tools to improve their products and services. I am excited to work for an organisation that is involved in developing sustainable initiatives.

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