Hotspot analysis in the PEF approach
Although LCA is ideal for identifying all the hotspots within a product’s life cycle or an organization’s value chain, it did not provide clear guidance on how to select the most relevant ones. Now, from the PEF pilots, the European Commission has established guidelines to select the most relevant hotspots and determine which data should be collected.
Nowadays, most businesses are committed to reducing their carbon or environmental footprint. To do this, it is important that they focus their improvement efforts on the activities that contribute most to the total environmental impact of a product’s life cycle or of an organisation’s value chain.
Hotspots are processes and activities that have a large contribution to the total environmental impact. Life cycle assessment is one way to identify these hotspots, and doing so has always been the focus of LCA studies. But LCA is not consistent in this, as there are no clear rules to help you find out which hotspots are the most relevant for you to focus on. So what’s different about hotspot identification in the PEF initiative?
Clear guidelines for hotspot analysis in the PEF initiative
In the PEF pilot phase, four types of hotspots are considered – you can see them on the image below. Two of the hotspots are relevant for determining data collection and data quality requirements, while the other two are relevant for external communication. Of these four, three are relevant for internal decision-making at the company level.
Traditional LCA has been used to identify hotspots for a long time. But what are the five most relevant ones? Or the top three? Or the ones that cause 90% of the total impact? The answer is simple: it depends.
It depends on the LCA practitioner and the choices he or she makes, as there are no clear rules in LCA on how to do this. In the scope of the PEF pilot phase, all that has changed. With PEF, a hotspot can be identified at different levels of granularity: impact category, life cycle stage, process or elementary flow.
A clear threshold is proposed: when ranked from most to least impact, the life cycle stages, processes or elementary flows that together make up 80% of the cumulative impact to any most relevant impact category should be considered relevant. Normalized and weighted results should be used to identify the most relevant impact categories, although others may be added on basis of expert judgement. Lastly, it’s important to mention that these rules apply for both, Product as well as Organisation Environmental Footprint.
The table documents the Identification of most relevant impact categories, life cycle stages, processes and elementary flows as proposed by the European Commission for PEF and OEF. Source: “Guidance for the implementation of the EU Product Environmental Footprint (PEF) during the Environmental Footprint (EF) pilot phase. Version 6.3 – December 2017”
So, where to focus your improvement efforts?
In the PEF pilot phase, the Commission requests the identification of the most relevant contributors. This offers you the focus needed to improve the environmental performance of your product (PEF) or organisation (OEF).
To illustrate how this would work in practice, let’s look at an example.
Most relevant impact categories
After calculating the normalised and weighted results of all impact categories, you rank them from high to low. Those contributing cumulatively to 80% of the total normalised and weighted results were selected. In this case, the most relevant impact categories are: Climate change, Particulate matter, Acidification, Terrestrial eutrophication, Land use, and Fossil resource use.
Most relevant life cycle stages and processes
For each most relevant impact category, characterized results are calculated and the life cycle stages are ranked from high to low. Those contributing cumulatively to at least 80% of the characterised impacts are selected. In the case presented below, the most relevant life cycle stages become: Raw materials acquisition and pre-processing, Product manufacturing, and End-of-life. The most relevant processes are identified in a similar way, for each most relevant impact category and a cumulative impact of at least 80%.
Implications of PEF hotspot identification
The PEF pilot phase will soon start to test the using the most relevant impact categories and life cycle stages in external communication. More importantly, identifying the most relevant processes and impact categories has implications for the data collection and data quality requirements. The data needs in the PEF pilot phase are adressed in another article.
Learn more about PEF
If you want to learn more about our role in the PEF initiative, please send me an e-mail. See other episodes of this series:
The time of the industrial revolution is over. Now it is time for the green revolution to go full steam ahead! Everybody needs to be involved in this process, therefore I aim to guide individuals and businesses in understanding the trade-offs between impacts. This will help them make informed decisions, which will truly help sustainable living thrive."