Tuomas Pasanen
BEST PRACTISES TO ANALYSE CAR- BON FOOTPRINT ON PROPULSION
PRODUCT VALUE CHAIN
Case: Waterjet
Master of Science Thesis
Faculty of Engineering and Natural Sciences
Mohammad Moshtari
Jussi Heikkilä
February 2021
TIIVISTELMÄ
Tuomas Pasanen: PARHAAT TOIMINTATAVAT HIILIJALANJÄLJEN LASKENTAAN PROPULSIOTUOTTEIDEN ARVOKETJUSSA – Case: Vesisuihkuvetolaite
Diplomityö
Tampereen yliopisto
Konetekniikan DI –tutkinto-ohjelma 2/2021
Teollisesta vallankumouksesta lähtien ihmisen synnyttämät hiilidioksidipäästöt ovat kasva- neet tasaisesti kohti kriittistä rajaa. Globaalilla muutoksella, jonka tunnemme paremmin nimeltä ilmastonmuutos, on valtavia vaikutuksia planeetallemme luoden haasteita, joita nykyinen- ja tu- levat sukupolvet joutuvat ratkaisemaan. Kasvavan ongelman sekä lisääntyneen ympäristötietoi- suuden vuoksi, eri yhdistykset, valtiot ja yritykset ovat alkaneet analysoimaan ja pienentämään toiminnasta syntyvää ympäristön kuormitusta. Yksi laajasti tunnettu termi tällä saralla on hiilija- lanjälki, mikä viittaa toiminnasta aiheutuneeseen hiilidioksidipäästöihin ja sen myötä hiilen pitoi- suuteen ilmakehässämme.
Hiilijalanjälki terminä on saavuttanut vahvan sijan puhekielessä ja liike-elämässä, minkä joh- dosta useita tuotteiden- ja palveluiden hiilijalanjälkianalyyseja on saatavilla yrityksille. Internet tarjoaa lisäksi paljon informaatiota ja erilaisia laskureita, joiden avulla myös yksittäinen kuluttaja pystyy tekemään vastaavia analyyseja ja muuttamaan elämäntapojaan kestävämpään suun- taan.
Standardisointiliitot ovat luoneet useita standardeja viimeisen 15 vuoden ajan, joita voi hyö- dyntää yrityksen eri toimintojen hiilijalanjäljen laskentaan. International Standards Organization, GHG Protocol ja Public Available Standard ovat tunnetuimmat tuotteen hiilijalanjäljen lasken- taan keskittyneet standardit, jotka kaikki perustuvat ISO-14040 Elinkaarenhallinnan menetel- miin. Ensimmäiset askeleet elinkaaren kokonaisvaltaisempaan hallintaan otettiin jo 1970 – lu- vulla, mistä muodostettiin yhtenäinen standardi vuonna 1997. Siinä missä elinkaarenhallinta on saavuttanut yhtenäisen ja hyvin kehittyneen rakenteen, tuotteen hiilijalanjäljen laskentaperiaat- teet ovat selkeästi hajanaisemmat. Tästä johtuen on erittäin tärkeää, että yritykset pystyvät löy- tämään omaan toimintaansa parhaiten soveltuvat laskentaperiaatteet. Elinkaarenhallinta ja hiili- jalanjäljenlaskenta ovat informatiivisia työkaluja, joiden ansiosta yritys kykenee paikantamaan energia- ja päästöintensiivisimmät prosessinsa.
Tämä diplomityö tarkastelee ja pyrkii löytämään soveltuvimmat toimintaperiaatteet propul- siotuotteiden elinkaaren hiilijalanjäljen laskentaan yhteistyössä Kongsberg Maritime Finland Oy:n kanssa. Propulsiotuotteisiin lukeutuvat vesisuihkuvetolaitteet, propellerit sekä erilaiset pot- kurikonfiguraatiot, jotka ovat suunniteltu ja valmistettu Suomessa. Diplomityö on jaettu kahteen pääosioon. Kirjallisuuskatsaus käy läpi elinkaarenhallinnan määritelmän ja toteutusvaiheet sekä hiilijalanjälkeen keskittyneet standardit esitellään ja arvioidaan. Näiden yhteydessä arvioidaan myös kokonaisvaltaisempaa ympäristöjohtamista eri mittareiden avulla.
Toinen osio keskittyy tapaustutkimukseen, joka toteuttaa käytännön tasolla kirjallisuuskat- sauksessa esitellyt standardit ja näiden pohjalta tehdyt havainnot. Tutkimuksessa käytetty data on kerätty toimittajilta, vapaista tietokannoista sekä aiemmista tutkimuksista. Vesisuihkuvetolait- teen hiilijalanjälki ilmaistaan kg CO2/tuote -muodossa, joka on yleisesti ehdotettu esitysmuoto tuotekohtaisessa hiilijalanjälkianalyysissa. Tutkimuksen päästölaskelmat on suoritettu OpenLCA – ohjelmistolla. Toisen osion lopussa tutkimustulokset analysoidaan, jonka yhteydessä suorite- taan myös skenaarioanalyysia, minkä tarkoituksena on esittää päästöissä tapahtuvat muutokset eri logistiikka- ja tuotantoratkaisuilla.
Avainsanat: Hiilijalanjälki, tuotteen hiilijalanjälki, elinkaarenhallinta, propulsiotuote, vesisuihkuvetolaite, ympäristöjohtaminen, kestävä kehitys
Tämän julkaisun alkuperäisyys on tarkastettu Turnitin OriginalityCheck –ohjelmalla.
ABSTRACT
Tuomas Pasanen: BEST PRACTISES TO ANALYSE CARBON FOOTPRINT ON PROPULSION PRODUCT VALUE CHAIN – Case: Waterjet
Master of Science Thesis Tampere University
Master’s Degree Programme in Mechanical Engineering 2/2021
Since the industrial revolution, carbon emissions generated by human activities has been in- creased steadily towards critical levels. Global change, which we know better as a climate change will have tremendous impact to our planet creating challenges, which must be solved by our- and future generations. Due to a growing environmental awareness, different associations, nations, and individual companies have started to analyze and decrease their environmental im- pact. One of the extensively known unit is carbon footprint (CF), and moreover, it’s quantity in our atmosphere.
Carbon footprint as a term has received solid foothold on colloquial language and there are multiple ways to analyze product- and service carbon footprint. In addition, internet offers free guidelines and information packages to individuals to make similar assessments and adjust the lifestyle to more sustainable way.
Standardization associations have created multiple standards in last 15 years, which can be tailored to analyze different company activities’ carbon footprint. International Standards Organi- zation, GHG Protocol and Publicly Available Standard are the flagship standards for Product Carbon Footprint (PCF) analyses, which are all based on the ISO-14040 Life-Cycle Assessment (LCA) -standard. First steps towards LCA concept was taken already in 70’s forming to coherent standard in 1997. Where LCA is advanced and relevantly uniform framework, does not have one solid way of analyzing and is rather fragmented. Therefore, it is essential to find the most suitable ways of working on carbon footprint calculations. Both LCA and PCF analysis are in- formative tools, which company may utilize to pinpoint the most energy- and emission intensive processes.
This study discusses and strives to find the best practices for carbon footprint measuring on propulsion product value chain for Kongsberg Maritime Finland Oy. Propulsion products include waterjets, thrusters and propellers, which are designed and manufactured in Finland. Thesis is divided to two main sections. On the first one, LCA practices and different PCF standards are introduced and discussed. Literature review will also enter to environmental management area where different environmental measurements are explained.
On the second section, thesis conducts a case study for waterjet applying the LCA and PCF steps in practice. Data for the case study is collected in cooperation with suppliers, utilizing free online databases and existing literature. Waterjet emissions is presented in kg CO2/unit, which is suggested unit for product carbon footprint. Emission calculations are performed with
OpenLCA software. At the end of the second section, case study results are discussed, and dif- ferent types of scenarios are created to visualize the impact of different transportation and man- ufacturing decisions.
Keywords: Carbon footprint, product carbon footprint, life-cycle assessment, propulsion product, waterjet, environmental management, sustainability
The originality of this thesis has been checked using the Turnitin OriginalityCheck service.
PREFACE
First of all, I would like to thank Kongsberg Maritime Finland Oy for such a great oppor- tunity to carry out my master thesis around interesting topic and Ville Rimpilä for men- toring during the whole process. Special thanks to Assistant Professor Mohammad Moshtari for giving me academic guidance and support.
The journey to this point has been long so my sincere gratitude goes to my family, friends and girlfriend for wonderful support since the beginning of my studies.
SISÄLLYSLUETTELO
1. INTRODUCTION ... 1
1.1 Background ... 1
1.2 Research problem and goals ... 2
1.3 Research structure and limitations ... 3
1.4 Motivation ... 4
2.LITERATURE REVIEW ... 5
2.1 Carbon Footprint ... 5
2.2 Life-cycle assessment (LCA) ... 6
2.2.1 Background of LCA ... 6
2.2.2 Principles and framework ... 7
2.2.3 Performing LCA ... 10
2.3 Product carbon footprint analyses ... 12
2.4 Sustainability management ... 14
2.5 Standards ... 17
2.5.1GHG Protocol Product standard ... 18
2.5.2 PAS 2050 ... 20
2.5.3EPD ... 21
2.5.4 ISO 14067... 23
2.6 LCA&CF software and databases ... 25
2.7 Discussion of PCF practices ... 26
2.7.1 Discussion of the standards ... 26
2.7.2 Choosing standard for PCF ... 29
3. METHODS ... 31
3.1 Case study fundamentals ... 31
3.2 Introduction of waterjet ... 33
3.3 Calculation methodology ... 34
3.3.1 Scope definition ... 34
3.3.2Modelling with Open LCA ... 36
3.4 Limitations of the case study ... 39
4.CASE STUDY: WATERJET ... 40
4.1 Carbon footprint inventory analysis ... 40
4.1.1GVC, Impeller chamber, Steering nozzle ... 40
4.1.2 Reversing bucket & Bearing house ... 43
4.1.3 Impeller ... 45
4.1.4 Inlet duct ... 45
4.1.5 Impeller shaft & Coupling boss ... 47
4.1.6 Sacrificial anodes ... 48
4.1.7 Common processes ... 49
4.1.8 Waterjet unit result ... 51
4.2 Interpretation ... 54
5.IMPLEMENTING PCF FOR PROPULSION PRODUCTS ... 56
6. CONCLUSION ... 59
REFERENCES... 62
APPENDIX A: COMPONENT FREIGHT DATA ... 66
APPENDIX B: INPUT-OUTPUT DATA FROM OPEN LCA PROCESSES ... 68
APPENDIX C: LORRY FREIGHT EMISSION DATA ... 74
APPENDIX D: CASTING EMISSION DATA ... 75
APPENDIX E: IMPELLER EMISSION DATA ... 76
APPENDIX F: ALUMINUM SHEET ROLLING EMISSION DATA ... 77
LIST OF FIGURES
Figure 1. Cradle-to-grave approach of LCA. Arrows represent transportation ... 7
Figure 2. Four iterative phases of LCA ... 8
Figure 3. Simplified impact assessment process... 10
Figure 4. Maturity stages of environmental management (Ormazabal, et al., 2015) ... 16
Figure 5. EPD process flow adapted from (EPD International AB, 2017) ... 22
Figure 6. EPD LCA stages and data requirement (EPD International AB, 2017) ... 23
Figure 7. ISO -standards relationship to ISO 14067 (International Standards Organization, 2018) ... 24
Figure 8. Waterjet case study approach mixed from linear and emergent approaches (Lee & Saunders, 2017) ... 32
Figure 9. Power and thrust generation with waterjet application ... 33
Figure 10. Waterjet main components ... 34
Figure 11. Waterjet manufacturing process flow ... 36
Figure 12. Navigation panel of Open LCA 1.10.3 ... 37
Figure 13. Electricity production processes in Open LCA software ... 38
Figure 14. Process flow of GVC, Impeller chamber and Steering nozzle ... 42
Figure 15. Reversing bucket and bearing house process flow ... 43
Figure 16. Inlet duct process flow ... 46
Figure 17. Sacrificial anode process flow ... 49
Figure 18. Contribution of component emissions on waterjet manufacturing ... 52
Figure 19. Generated emissions kg CO2 per produced kilogram ... 53
Figure 20. Waterjet unit emissions contribution by processes ... 54
LIST OF TABLES
Table 1. Sample of GWP values for different chemicals... 6
Table 2. Options for PCF approaches (British Standards Institution, 2014) ... 13
Table 3. Summarize and comparison of PCF standards ... 28
Table 4. Waterjet component mass proportions and materials ... 35
Table 5. GVC, Impeller chamber and Steering nozzle mass contributions ... 41
Table 6. Freight information of GVC... 41
Table 7. GVC, Impeller chamber, Steering nozzle emission results ... 43
Table 8. Reversing bucket freight data ... 44
Table 9. Reversing bucket and bearing house manufacturing emissions ... 44
Table 10. Impeller manufacturing emissions ... 45
Table 11. Inlet duct plate milling information ... 46
Table 12. Inlet duct manufacturing emission ... 47
Table 13. Round bar CO2 –emissions per manufactured ton of steel ... 47
Table 14. Impeller shaft and coupling boss manufacturing emission ... 48
Table 15. Sacrificial anode manufacturing emission ... 49
Table 16. Material handling data for waterjet components ... 50
Table 17. Component surface treatment areas ... 51
Table 18. Waterjet unit total emissions ... 52
Table 19. Aluminum component comparison between primary- and secondary aluminum production ... 55
LIST OF SYMBOLS AND ABBREVIATIONS
Al2O3 Aluminum oxide
BSI British standardization institution
CF Carbon footprint
CDP Carbon disclosure project
CH4 Methane
CO2 Carbon dioxide
CO2 eq. Carbon dioxide equivalent CSR Corporate social responsibility
EF Environmental footprints
ELCD European reference life cycle database EPD Environmental product declaration ETS Emission trading scheme
GHG Greenhouse gas
GJ Giga-joule
GVC Guide vane chamber
GWP Global warming potential HAP Hazardous air pollutants
HFC Hydrofluorocarbons
IPCC Intergovernmental panel on climate change ISO International standards organization
LAHW Laser arc-hybrid welding
LCA Life cycle assessment
LCI Life cycle Inventory
LCIA Life cycle impact assessment MMAW Manual metal arc welding
MMTCDE Million metric ton of carbon dioxide equivalent
MJ Mega-joule
MWh Megawatt-hours
N2O Nitrous oxide
NDT Non-destructive testing PAS Publicly available standard
PFC Perfluorocarbon
PCF Product carbon footprint PCR Product category rules
ppm Parts per million
REPA Resource and Environmental Profile Analysis
rpm Rounds per minute
SD Sustainable development
SF6 Sulfur hexafluoride
SETAC Society of environmental toxicology and chemistry TBL Triple bottom line
VOC Volatile organic compound
kg Kilograms
km kilometer
kWh Kilowatt-hours
m2 square meter
m3 cubic meter
mni nautical miles
t*km ton-kilometer
1. INTRODUCTION
1.1 Background
Kongsberg Maritime Finland Oy is part of Kongsberg Maritime, which is international marine sector company In Finland owned by Kongsberg Group. It has three units lo- cated in Turku, Rauma and Kokkola. Azimuth thrusters are designed and manufactured in Rauma, Kamewa waterjets in Kokkola and Turku unit is focusing to ship intelligence development (Kongsberg Group, 2019).
Kongsberg Group launched a sustainability strategy in 2016, which was called “Tech- nology for global challenges”. In addition to focus on human rights, business ethics and anti-corruption, Kongsberg also released ambitious target to decrease carbon emis- sions by 20 % until 2020 (Kongsberg Group, 2016). In 2019’s report it was assumed that target will not be reached as emission level will remain more or less same during the whole period. Concurrently Kongsberg released new sustainability goals for period 2020-2030, which is called “Science based Target”. The goal is to evaluate more accu- rately if the set targets are sufficient for greenhouse gas emission reducing. This strat- egy has been implemented in one unit in Norway and in future it will be conducted to internal operations, value chain and logistics (Kongsberg Gorup, 2019).
On both strategies, it can be seen that Kongsberg is keen to develop more sustainable products and services, which other organizations could utilize. Innovations to reduce greenhouse gas emissions on oceans such as autonomous vessels, hybrid systems and electric ferries are important part of company’s sustainability strategy. According to the reports, Kongsberg’s internal gas emission rate is comparatively low and therefore it did not submit Carbon Disclosure Project (CDP) –reports after 2017. After the acqui- sition of Rolls-Royce Commercial Marine business and greater interest of carbonfoot- print in public, company has decided to continue CDP reporting from 2020 onwards (Kongsberg Gorup, 2019).
Even that Kongsberg and many other companies are reporting carbon emissions, wa- ter- and energy consumption, very rare are reporting and actively calculating individual product carbon footprint. The increased need of more sustainable way of thinking and operating has launched the company’s curiosity to know their product’s carbon emis- sions. At this stage, the target company does not have any resource nor activity around this task.
Today, many entrepreneurs have seen that customers and partners are keen to know individual company’s carbon footprint. Businesses are evolving to more sustainable di- rection as Finland has placed its goal to be carbon neutral by the end of 2035. This means that big companies have to emphasize environmental related questions in order to sustain competitiveness in market. Entrepreneurs’ attitude against social problems has been changed significantly in few years. Already 72 % of the companies feel it im- portant to solve social problems in 2020, as the amount was only 56 % one year ago (Yrittäjät, 2020).
1.2 Research problem and goals
The goal of the thesis is to find the most suitable operating model for carbon footprint measuring in order-supply chain. Found model/standard is intended to be utilize for every propulsion product in Marine sector, which means it must be applicable for sev- eral product and product families. The goal is not to create new way of counting the carbon emissions but instead analyzing and utilizing existing standards and models.
Result of this thesis is to present complete model, which will best suit to company’s current terms and requirements. Following criteria are set by the target company:
- Scalable/suitability for several products and product families - minimized internal process changes
- cost-effectiveness
- unambiguous and comparable result of product carbon footprint.
Scalable model prevents multiple standard utilization and therefore the process is co- herent regardless about the product or business unit. It is not favorable that the created model would change internal processes significantly at this stage. The third criteria are more or less the result of the two first criteria. It also involves the needed resources for launching and running the carbon footprint analysis.
The fourth criteria are linked to the second goal of the thesis, which is to use the se- lected model and calculate example value for waterjet carbon footprint manufactured in Kokkola. From this value, the target is to scale the value for whole waterjet product family. Result from this calculation should be able to express in carbon dioxides (CO2) in kilograms or in another equivalent unit.
Research questions for the thesis are following:
- RQ1: What is the most suitable practice in terms of cost effectiveness, scalabil- ity and reliability for propulsion product carbon footprint analysis?
- RQ2: How much one waterjet generates carbon footprint?
1.3 Research structure and limitations
The structure of this thesis follows the basic guideline of master thesis. After introduc- tion and limitations are presented, chapter 2 presents the first part of the theoretical background focusing to the theory of carbon emissions, its role in climate change and product carbon footprint (PCF) fundamentals. The second theoretical background con- centrate to the existing carbon footprint standards. This chapter will also briefly intro- duce the computer software that are nowadays in use for carbon footprint calculations.
Following from this, chapter 4 discusses about the standards and based on evaluation, suggestion for the most suitable one for company’s use according to the criteria will be done.
On chapter 5, carbon emission for waterjet will be calculated as a case study by utiliz- ing the chosen standard guidelines, LCA methodology and LCA calculation software.
Results will be presented for the whole unit breaking it down to the component level re- sults. Chapter 5 will also include discussion of the results and limitations. At interpreta- tion, different scenarios are created for supply chain and manufacturing to compare the emissions in different cases. Chapter 6 will introduce the framework and requirements for conducting the PCF -calculation for other propulsion products based on literature re- view and case study.
For the theoretical background, existing literature will be used widely. Standards and existing models are easy to reach but in addition to that, real case examples, evalua- tions and scientific articles will be used in order to answer on research question 1. For the question 2, technical data of the waterjet and publicly available databases will be used.
The thesis is intended to be utilized on propulsion product business unit, which means that evaluated and suggested methodology is made from the manufacturing industry point of view. Because of LCA practices coherent nature, same practices can be used to other Kongsberg’s products, but it won’t be applicable for services due to its different features and LCA stages.
The examined value chain includes the activities from raw material extraction to the point when the product is packed and ready to be shipped to customer. This means that from the full life-cycle assessment, the last transportation, usage- and disposal parts are excluded from the research. This is because of two reasons: the very limited availability of information of usage profile and data, because several projects are clas- sified and administered by governments. Second, waterjets and propellers are powered with diesel engines and therefore emitted carbon emissions are insignificant on usage stage. Data availability is also the reason for leaving outside the disposal part.
On a case example, carbon footprint calculation will include emissions that are gener- ated by the manufacturing activities and transportation of the components. Other emis- sions will be excluded from this section. Thesis will suggest the most sufficient model and give abstract result from the case calculation but will not suggest how to reduce carbon footprint from the observed value chain.
By the company request, published version will not include product model names, sup- pliers’ names and detailed locations. Also, component masses are excluded from this version due to a product information confidentiality.
1.4 Motivation
The idea for this thesis’s topic was launched by the company representative Ville Rimpilä. In March 2020 he explained the company’s need for carbon footprint evalua- tion and how important it is to go to more sustainable way of working from the business point of view. This thesis will support the new sustainable strategic where carbon emis- sion has essential role in future.
From the personal point of view, the topic is not important only from business-, and marketing point of view but also ecologically important. As said in the introduction chapter, companies are more aware and interested about their carbon footprint be- cause today customers, both individuals and companies, are going towards more sus- tainable lifestyle and demands more information about the environmental impact of the product and service. This type of behavior is crucial to achieve the 1,5 °C global warm- ing limit, which was agreed in Paris Climate Agreement in 2015 (Mänty, 2019). Unfortu- nately, the gap between the optimal- and real lifestyles is still quite big. People and companies have not yet been able to adopt to these new frames, which would slow down the global warming and eventually global changing.
The motivation lies behind the possibility to study something that concerns not only the target company but also all the whole maritime business and our ecological system.
Standards that are introduced in this research, are prepared to empower companies’
carbon footprint analysis. Similar, but much simpler ways of studying individual carbon footprint can be found in internet. I strongly believe that the first step is to know in- curred emission before these can be gradually reduced. Same paradigm applies to car- bon footprint than any other numerical value in the economy field: If you cannot meas- ure it, you cannot manage it (M-J. Franchetti, 2012).
2. LITERATURE REVIEW
2.1 Carbon Footprint
Even there is no uniform scientific definition for carbon footprint, Wiedmann and Minx appoint in their book “A definition of carbon footprint” following: “the carbon footprint is a measure of the exclusive total amount of carbon dioxide emissions that is directly or indirectly cause by an activity or is accumulated over the life stages of a product”. This definition includes emission impacts from products, services, individuals, organizations, governments etc. (Wiedmann & Minx, 2008). Besides this definition, it is widely per- ceived that carbon footprint includes the total amount of greenhouse gases (carbon di- oxide, methane, and nitrous oxide) generated by human activities and through natural processes to atmosphere (Participant Media, 2014). After all, the key meaning of car- bon footprint is to express our impact to climate change (Wiedmann & Minx, 2008).
CO2 is clearly the primary emission, which is generated by burning fossil fuels such as coal and oil. Greenhouse effect occurs when emissions accumulate to our atmosphere and there is not enough bio capacity to absorb it (Global Footprint Network, n.d.). CO2
concentration level in atmosphere is monitored yearly by different authorities and re- search centers. In 2008 Hansen argues in his seminal paper that concentration level should be maximum 350 parts per million (ppm) and preferably lower from that. He jus- tifies this statement by environmental changes, which should be rather stable if this tar- get is reached (M-J. Franchetti, 2012). According to National Oceanic and Atmospheric Administration of the United States Department of Commerce (NOAA), the average concentration level in 2019 was already 409,8 ppm being the highest result in 800 000 years. Pace has been increased between 2009 and 2018 averagely 2,5 ppm/year (Lindsey, 2020) Since the industrial revolution, human activities have increased the concentration level by 47 % mainly due to a fossil fuel burning. Human activities cannot be questioned when speaking about climate change. Intergovernmental Panel on Cli- mate Change (IPCC) fifth report from 2014 shows that 1300 scientist around the world conclude by common assent that Earth’s temperature has been increased in last 50 years by human activities (NASA, 2020)
Today carbon footprint can be measured for every product and service. Individuals can calculate personal footprint from internet for different activities, such as air travel emis- sions. Carbon footprint reporting for companies is mandatory in 40 countries across the world, from which majority are western countries. Reporting requirements vary across
the countries, but commonly followed standard is WRI/WBCSD GHG Protocol (Carbon Footprint Ltd., n.d.).
Every chemical has their own global warming potential value as presented in below ta- ble. This value can be used to compare the energy emitted by 1 ton of gas during spe- cific time frame compared to carbon dioxide (Vallero, 2019).
Table 1. Sample of GWP values for different chemicals Common name
Chemical for-
mula GWP (100 years)
Carbon dioxide CO2 1
Chloroform CHCL3 16
Methane CH4 28
Nitrous oxides N2O 265
Sulfur hexafluoride SF6 23500
The most common, and also used on this thesis, is GWP 100 years. Carbon dioxide last hundreds of years in the atmosphere but for example Methane, which can absorb much more energy than CO2 is lasting around decade, has GWP value 28. CO2 – equivalents (CO2 –eq.) are most commonly expressed as million metric tonnes of car- bon dioxide equivalents (MMTCDE), which is the result of equation 1 (Eurostat, 2019).
𝑀𝑀𝑇𝐶𝐷𝐸 = 𝑚𝑖𝑙𝑙𝑖𝑜𝑛 𝑚𝑒𝑡𝑟𝑖𝑐 𝑡𝑜𝑛𝑛𝑒𝑠 𝑜𝑓 𝑔𝑎𝑠 ∗ 𝐺𝑊𝑃 𝑜𝑓 𝑡ℎ𝑒 𝑔𝑎𝑠 (1)
This is often used on industrial emissions (Vallero, 2019). This thesis will express the CO2 –equivalent in kg per unit produced.
2.2 Life-cycle assessment (LCA) 2.2.1 Background of LCA
LCA has become popular tool for multiple companies and organizations to review envi- ronmental impacts through the whole life cycle of product or process. The whole LCA concept has evolved during the decades since the late 1960s when Coca-Cola com- pany re-evaluate and challenged their supply chain for more environmentally friendly cans. During 1960s and 1970s energy efficiency and pollution became a public topic and environmental aspects were highlighted on manufacture industry. Outlook of the waste management were simpler as companies focused more on single factories or production facilities. This “waste reduction” approach did not consider the other im- portant stages of the product or process such as value chain. At 1974 Basler & Hofman
created “Resource and Environmental Profile Analysis (REPA)” -concept, which can be considered as a kick-start of the LCA approach as product’s value chain was investi- gated from “cradle-to-grave” (Curran, 2015).
Following decades until 1990s LCA was conducted with different ways without common and solid theoretical framework. Growing interest to the environmental impacts and cost saving potential led to numerous scientific researches and standardization by In- ternational Standard Organization (ISO) mid-1990s. Besides the standardization, Soci- ety of Environmental Toxicology and Chemistry (SETAC) brought scientist and users together to elaborate more coherent LCA framework (Curran, 2015).
2.2.2 Principles and framework
As stated before, LCA framework is used for products and service by using “cradle-to- grave” -approach. With this, all the energy inputs and outputs are evaluated during the whole life cycle as seen in figure 1. It is also possible to perform simpler gate-to-gate approach, which exclude indirect activities such as supply chain. Due to complex global supply chains in manufacturing industry, which Kongsberg’s propulsion products has as well. Due to this, simpler approach would not be comprehensive enough and would not lead reliable carbon footprint results for products (Jolliet, et al., 2015). The Interna- tional Standards Organization (ISO) have built an LCA standard ISO-14040 -series, which offers solid guidelines for companies to conduct LCA. It is part of the ISO-14000 Environmental Management -series. Below picture only represents example steps of LCA. It is possible to add more critical steps to the life cycle of a product or service.
Figure 1. Cradle-to-grave approach of LCA. Arrows represent transportation The latest LCA framework is built with for iterative phases as follow: Goal and scope definition, Inventory analysis, Impact assessment and interpretation. The first phase of
the analysis is Goal and scope definition (ISO 14040:1997/2006), which is also known as a Goal and system definition. On this phase, the reason and motivation be- hind the LCA conducting is introduced. This part describes how the results are used and who are the audience and stakeholders. In addition to that, the reviewed functional unit is described, and the boundaries of the study will be determined. Functional unit and its boundaries are the two main characteristics of LCA, which is called system function. Some products may have more than one function and therefore primary- and secondary functions need to be identified (Jolliet, et al., 2015). Every functional unit un- der review will have own flow chart called reference flow, which presents all the goods and service to implement the functional unit. In real cases flow chart is basically com- plex product tree where every relation is represented by boxes from the raw material production until disposal or until it exceeds the defined system boundary (Internation Standards Organization, 2018). The first phase is crucial as it sets the boundaries and frame for the whole assessment. The end results are strongly depending on the choices made on this phase (Jolliet, et al., 2015).
Figure 2. Four iterative phases of LCA
The second phase Inventory Analysis or Life-Cycle Inventory (LCI) is quantitative amount mass, energy and pollutants included in the whole reference flow of the re- viewed functional unit. There are several ways to conduct inventory analysis: process- based approach, input-output (I/O) approach, and hybrid model, which is combinations of the first two approaches (Jolliet, et al., 2015).
The fundamental of the phase is to find out the total emissions and resource extrac- tions that are generated throughout the reference flow of the functional unit. Summariz- ing different approaches, we can say that process-based -approach uses physical ref- erence flows and I/O -approach uses economic flows, where each economic sector is
linked to energy consumptions, resource extraction and pollutant emissions per mone- tary unit. I/O approach is many times used for service LCA as it finds better the gaps on supply chain than process-based approach, which tends to consider also unneces- sary sub-processes. On the other hand, I/O approach do not include use -stage and waste treatment, which are key parts of the LCA analysis (Jolliet, et al., 2015). ISO- 14044 -standard do not explicitly name different approaches on their guidelines but uses input-output -terms.
It is possible that during the inventory analysis -phase, system boundaries must be re- vised due to a better understanding of the system function. Biggest concerns lie on the data collection when reference flows are complicated and there are numerous func- tional units (Internation Standards Organization, 2018).
Life cycle impact assessment (LCIA) follows the quantities of energy and materials extractions are identified on inventory analysis. Based on the inventory results, emis- sions can be classified in different categories according to their impact to the environ- ment. This phase reveals the possible impact to environment or human health based on the inventory results. The long list gathered from the inventory analysis will be mod- eled to more descriptive manner by addressing emissions to different impact catego- ries. Impact categories can be for example climate change, human toxicity, land- or wa- ter use impacts. Emissions that has similar effects will be in same impact category, which is called midpoint category and it is between the inventory results and damages caused by the certain emission. Midpoint indicator will be pointed for every midpoint category to characterize its contribution (Jolliet, et al., 2015). Character convert the LCI result into common metric such as CO2 eq. on climate change category. The last part of this path is the damage category, which represents the actual damage of the single emission or resource extraction. It is possible to conduct the assessment only to the midpoint category -stage if the results are acceptable compared to the goals of the LCA but continuing until the endpoint (damage category) will yield more intelligible results as shown in figure 3 (Curran, 2015).
Figure 3. Simplified impact assessment process
The last phase Interpretation is a summary of the findings on LCI and LCIA phases. It gives valuable information for the decision makers by highlighting where the environ- mental impacts are generated and what are the possible ways to reduce it. It may show on which life cycle stage the most environmental impact is generated. It is also essen- tial to clearly state how the different allocations and trade-offs are done to gain the pre- sented results as well as the limitations of the study. LCA is an iterative process so in- stead of conducting interpretation only once at the end, it should be considered after every phase of the assessment, especially after inventory analysis before moving to impact categories.
2.2.3 Performing LCA
Launching the LCA process is a big step towards to more comprehensive carbon man- agement. In many cases, conducting detailed LCA for industrial goods might need more assets than company is able to provide. Most small and middle size companies do not have such an expertise in-house and therefore outsourcing the LCA would be an effective solution. Starting the LCA without external consultant can be done in two steps: First to conduct preliminary assessment where key life cycle steps and related processes are identified. This may prevent unnecessary work and negligible processes will be left out from the actual assessment. Second step is to conduct more detailed LCA as explained in previous chapter. On First step, it is possible to make the calcula- tions by hand when only several factors are evaluated like CO2 and waste. When more substances are present, calculations by using software is recommended (Curran, 2015).
Cut-off rules are usually decided on the first phase of LCA and will become important part on inventory analysis. Cut-off means which processes are included inside the boundaries and which are left out because of the minor impact to the result. There is no coherent guidance how to use cut-off rules as some upstream processes might have substantial impact and it is difficult to evaluate what is the possible error from the left- out processes. One way to clearly outline the processes is to use mass or cost basis rule. For example, LCA may include 95 % of the system mass but this alone would be too fragile cut-off rule as it might exclude individual input that contains 5 % of the sys- tem mass, which would lead to inaccurate result. It is more recommended to use 95%
mass limit but include all the inputs that has for example 1 % from the total mass of the system. This approach is though contradictory with LCA fundamental to include 100 %
of the system throughout the whole life cycle. Practically this rule is inaccessible when time frame and assets are limited. In some cases, data from direct sources (primary data) will not be available and publicly available data (secondary data) must be used, which always includes uncertainty.
Conducting the LCA for a product or service has many reasons. The most common reasons are:
a. Improving product performance. With LCA, contributions of each processes and life-cycle stages, which can be improved will be more transparent. This helps companies to design more sustainable goods, called as an eco-design. This perspective usually reduces, or redesign material used, which can be also more cost efficient for the company. Eco-design also concentrates to product use and disposal stage, trying to make it lighter, less polluting and recyclable.
b. Product comparison can be conducted between several products internally, which can give insights to production and design process improvements. Com- parison can be also conducted with competitor’s product, which may be useful for marketing and competitive advantage.
c. Part of strategic planning. As known, sustainability is already a megatrend, which every company needs to pay attention sooner or later. Planning long- term environmental strategies, LCA gives valuable information if product changes need to be done due to a legislation or by customer request. Some countries have standardized tender model, which requires information about the product environmental data. LCA result can be utilized to plan future products, production, and supply chain, which reduces the risks of losing competitive ad- vantage in long-term.
d. Getting out from “end-of-pipe” -approach, which is more expensive way to im- prove product sustainability as company will be responsible to handle the waste rather than just design more environmentally friendly products (Curran, 2015).
LCA has its limitations. Firstly, it can be really time consuming especially on data col- lection phase (LCI). Secondly, several uncertainties are always present depending how the rules of good practices are followed during assessment. Inconsistent data collection or allocation may lead to misleading results and eventually wrong conclusions on inter- pretation phase. Conceptually LCA is considered to be fairly rigid approach (Curran, 2015). LCA measures the impact ones and when changes for example in supply chain occurs, data is difficult to update dynamically and the assessment will not be valid (B Corporation, 2018). LCA provides good tools from environmental point of view but do not consider social and economic perspectives, which need to be conducted using
other tools such as life cycle costing and social LCA. The people conducting the as- sessment are in vital role. All the data collection, assumptions, allocation, and impact category weighting are depending on them (Curran, 2015).
2.3 Product carbon footprint analyses
Where Life Cycle Assessment is analyzing the total environmental impact of product and service, PCF analyze only greenhouse gas (GHG) emissions caused by a product or service. Emission results are presented as carbon dioxide equivalent (CO2 eq.) to obtain only one unit for review but not leaving out other emissions. To get more robust results and impact analysis, characterizations are used, from where GWP is the most ruling one. GWP is based on radiative forcing of different gases and reported by IPCC (Henriksson, et al., 2015). The goals and applications of PCF is really close what was introduced with LCA. Usually both are used for comparative purposes but first of all to answer growing awareness of climate change (British Standards Institution, 2014). As PCF can be assumed to be only one element of LCA’s impact category, global warm- ing, it can be considered as a slighter version of full LCA.
PCF strongly originates from the LCA and emphasize the full life cycle, but exceptions can be made like Germany based chemical company BASF had done. Company’s cus- tomers have been making more and more environmentally conscious purchasing, which led BASF to develop their own carbon PCF methods. By launching new digital application for carbon emission calculations, company have been able to analyze its 45 000 product’s carbon footprints with “cradle-to-gate” method and will conduct same calculation for global product portfolio by the end of 2021. Company have stated that with the provided environmental information, they can help customers to reach their own climate goals and therefore create more value to their products (BASF SE, 2020).
Motivation for creating own application and calculation method highlights the problem of practical PCF -analyze: The available standards and guidelines provide principles of analyses but do not give concrete information how to conduct it to a single product.
This will lead to a comparison problem of the same product, which analyze have been conducted by a different organization. Assumptions and data collection are really de- pended about the performer just like with LCA (Henriksson, et al., 2015).
British Standardization Institution (BSI) have created simple guidance to get started with PCF and states that even simple analyze will give insight information about the product’s sensitive emission spots. According to the guidance, simple analyze will take around 2-3 months where more detailed survey would take 6-12 months. If company starts from the scratch without any LCA orientation, latter time frame might not be even
enough. As BASF conducted “cradle-to-gate” -approach, BSI also suggest three differ- ent approaches depending on company’s goals and intentions of the study. The other two are: “cradle-to-grave” and “cradle-to-cradle”. Features of the approaches are listed in below table 2, which may vary between companies and their business models, but fundamentals of the approaches are easy to understand (British Standards Institution, 2014).
Table 2. Options for PCF approaches (British Standards Institution, 2014)
The selected approach is a result of the boundary setting -phase where company can make a list what at least must be included in a study. In addition to list, company may ask correct questions referring to the goal of the study, for example:
- Is the study for internal improvement?
- Is the study for eco-design?
- Are the results used for communication or marketing purposes? (British Standards Institution, 2014)
The other key step at the beginning of PCF is to choose the correct product for which the review will be conducted. If companies have only one or two products, PCF can be conducted for both but in case of wider product portfolio, delimiting can be done with following characterizing:
- Product Visibility. Conducting PCF for flagship product may lead to better sales numbers.
- Product with biggest improvement possibility.
- Data availability, which may vary between products, is depending about the value chain transparency and level of cooperation with suppliers (British Standards Institution, 2014).
The latest character is the cornerstone of both PCF and LCA and usually creates the most uncertainties to the results and impair the comparative quality between products.
Stages Cradle to gate Cradle to grave Cradle to cradle
Raw material extraction X X X
Transportation X X X
Manufacturing X X X
Distribution X X
Retail X X
Use X X
End of life X X
Recycling (closed-loop) X
PCF process continues by creating process map around the product and data sourc- ing. Once the data has been collected from all the life-cycle stages under review, the footprint of each process step is simply calculated with following equation:
𝐶𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛 𝑑𝑎𝑡𝑎 𝑥 𝐸𝑚𝑖𝑠𝑠𝑖𝑜𝑛 𝑓𝑎𝑐𝑡𝑜𝑟 = 𝐹𝑜𝑜𝑡𝑝𝑟𝑖𝑛𝑡
Where consumption data is quantitative value from the process, either primary- or sec- ondary data, which is multiplied by the relevant emission factor (British Standards Institution, 2014). Factors are available in different databases, such as IPCC’s data- base, which have been developed since 2002 (Greenhouse Gas Protocol, n.d.). The last part of the PCF is the communication to all stakeholders. The manner of communi- cation varies if the study is only conducted for internal use or for marketing purposes.
In both cases, transparency is underlined as the results may bring up questions and even criticism. Comprehensive report with study methods and possible trade-offs will bring credibility for the study. It is advisable to communicate the results to supply chain where the data is collected. This information might be beneficial them to re-evaluate their own processes and even reduce emissions, which then affects to company’s product (British Standards Institution, 2014).
2.4 Sustainability management
Numerous literature and public discussion are presenting why companies should high- light environmental issues on their strategic decisions but still there are very few straightforward guidelines nor standards to explain how. This might be the root cause of the survey results, where 93 % of CEOs think that sustainability has a substantial im- pact to future success but only 38 % state that the sustainability goals and targets are accurately measurable. Same survey revealed that 84 % of CEOs feels that companies should lead the way in sustainability matters, but from where only 33 % felt their busi- ness are actually investing enough to sustainable challenges. Clearly the majority is understanding sustainable development (SD) but minority are conducting actual steps towards this (Maas, et al., 2016).
First of all, sustainability is development to meet the present needs without harming fu- ture generations to accomplish their needs. In business world, this means to reach eco- nomical goals in environmentally healthy way. SD is fragmented model and several dif- ferent approaches has been conducted on operational level and even more on theoreti- cal level. In addition to economic and environmentally success, third concentration is Corporate Social Responsibility (CSR) (Madu & Kuei, 2012). This approach is called Triple Bottom Line (TBL) and it focuses to economic development, environmental pro- tection, and social responsibility, shortly called profit, people and planet. TBL accent
companies’ responsibility to focus environmental and social aspects as much as to profit side. Even the first two aspects have been the talking point mainly in last decade, TBL has been introduced first time in 1994 by management and sustainability guru John Elkington. Challenges of this method has been the measurability of social and en- vironmental aspects and what are the correct indicators (W.Kenton, 2020). Carbon footprint is one potential indicator but calculating it for the whole company is difficult and time-consuming. For the CSR, Global Reporting Initiatives have developed guide- line for companies to measure and report it (Chamberlain, 2011). Second challenge is the balance between the three bottoms and corporates ability to assign enough re- sources to all without cannibalizing the other. Third challenge is the unfortunate truth that profit line is considered more important than other two, which usually lead environ- mental issues or social neglects (W.Kenton, 2020). The three pillars of TBL are also seen as individual management systems (MS) that does not communicate at all. Be- sides its weaknesses, it is a good tool for companies to wider their understanding of position and competences in future (Chamberlain, 2011).
Other approaches are also in use in large companies, such as Balance Score Card, which is utilized by General Electric, Coca-Cola, and Shell. This has been criticized by its static and shareholder-orientated manner and it does not focus on the whole pro- cess. Management systems offers several models and techniques for SM depending what is the nature of the organization, but the problem lies on the achieved goals and received value. There are still problems to develop sustainable management system, which is dynamic and systematic. If all managements systems are considered individu- ally (environment, profit etc.) there are always gaps between. Daily operations between departments and management levels are advised to be more integrated in practice, if possible. The interplay between these have not received enough attention by research- ers even the suggestions points to this kind of direction. Companies shall start to evalu- ate how the sustainability information is collected, analyzed, and reported internally. In addition, to investigate which tools are used and how (Madu & Kuei, 2012).
Lo and Sheu determines the sustainability management as “a business value that cre- ates long-term shareholder value by embracing opportunities and managing risks from three dimensions: economic, social and environmental dimensions”. This highlights that business activities are partly volunteer to achieve sustainable future. Different re-
searchers are also pointing out the importance of acclimation by creating new business model, more sustainable products and seeing regulations as opportunity. Focusing only on value chain may reach significant results in terms of sustainability as the whole
value chain need to be achieve sustainable growth. These views are in line with funda- mental of the competitiveness that the most innovative companies will be most proba- bly ahead of their competitors (Madu & Kuei, 2012).
The need of environmental management in organizations has been realized only few decades ago and it is evolving due to a fast-changing business environment. Ormaza- bal and Co. have studied the different steps in environmental management in UK and how to move forward with it. The concept is based on 6 different levels called maturity stages of environmental management, where company moves forward by learning new activities or comply operational practices towards more sustainable direction. Once moving to next level, company will own the acquirements of the previous level and sim- ultaneously adapting new ones. Sometimes it is possible that company jumps over one step or fulfills the requirements of another stage but not the requirements of the previ- ous stage (Ormazabal, et al., 2015).
Figure 4. Maturity stages of environmental management (Ormazabal, et al., 2015) On Level 1 company is able to fulfill the legislation and environmental regulations.
Level 2 represents the stage where company fulfills all regulations which has been set and it is ready to fulfill upcoming ones by creating measurement systems and training employees. Having systematic approach to environmental management on Level 3,
management up to the top are commitment to the system. Stage is highly market driven, when new requirements have been set by customers and other stakeholders.
Level 4 as called ECO2 –stage is where company receive economic benefits of envi- ronmental thinking and designing. Environmental impact is lower, and employees are courage to participate innovations. Followed by this, Level 5 will be reached when company develop eco-innovative products such as carbon-neutral or even carbon-neg- ative products and services. The final step is Level 6 where company is considered as a leading green company. Company itself is a reference for other organization in terms of environmental management. Marketing and communication are highlighted at this level and company receives positive publicity due to its superior environmental perfor- mance (Ormazabal, et al., 2015).
In addition to maturity stages, Ormazabal introduce several different Environmental management tools in her dissertation in 2013. Environmental Impact Assessment (EIA) is related to decision making process from environmental perspective. EIA can be used as a preventive tool to analyze decision’s consequences and alternative options in a systematic way. ISO 14000 –standard is implemented around this concept and Strate- gic Environmental Assessment (SEA) is basically extension from previous concept wid- ening the environmental assessment to all levels. SEA has been recognized to be suc- cessful tool integrating social, economic and environmental aspects to program- and policy decision processes. Eco labelling instead is a good informative tool to express the environmental performance of the company besides sustainability reports and web pages (Ormazabal, 2013).
In addition to previously mentioned, Ormazabal bring up the LCA and Carbon Footprint Analysis as an effective tool for Environmental Management on a product and service level. Similar emphasis has been done by Muralikrishna & Manickam in 2017, applying Life Cycle Energy Analysis alongside the original LCA. This stems from the reason that indirect energy consumption and more importantly its source must be considered (Muralikrishna & Manickam, 2017).
2.5 Standards
Growing interest towards the robust and transparent information of products’ environ- mental impact and particularly carbon footprint (CF) has led to the development of nu- merous methods to calculate it. Mostly the methods are based on the three important CF standards: GHG Protocol Product Standard, ISO-14067 and PAS 2050. The Fun- damental of all these is the LCA approach, based on earlier introduced ISO-14044 - standard and ISO-14040 (S.Wang, et al., 2018). Other initiatives have been created by
different organizations to be used regionally and locally. For example, Japanese Gov- ernment created Labeling Pilot project in 2009 as a result from Carbon Footprint pro- gram and France have created their own standard called BP X30-323 (Pre-
Sustainability B.V, 2012).
Product carbon footprint standards provide guidelines for companies to conduct PCF and creates credibility for marketing and branching purposes. As there are no universal standard to follow, companies may struggle to find the most suitable one, which would comply with daily operations (Pre-Sustainability B.V, 2012). Next paragraphs will intro- duce three major standards and their characteristics and additionally few fewer known standards. At the end of this chapter, carbon footprint software is introduced.
2.5.1 GHG Protocol Product standard
GHG Protocol Product Standard was released in October 2011 by World Research In- stitution together with World Business Council for Sustainable Development. The Tech- nical Research group consistent more than 100 members, including companies from different industries, governmental organizations, and non-profit organizations. After the first- and second draft and testing by 38 companies, more than 1600 members gave feedback before final revision was published (Greenhouse Gas Protocol, 2011). The framework is built according to LCA standard and the first revision of Publicly Available Standard 2050 (PAS2050). GHG Protocol owns several other emission standards, which they have categorized as a scope 1, 2 &3. Scope 1 standard gives guidance to calculate and report all direct emissions, where scope 2 applies indirect emissions of purchased electricity, heat or steam. Scope 3 includes rest of the indirect emissions on corporate activities, both upstream and downstream in value chain. Scope 3 Corporate Standard and Product standard both take life cycle approach or value chain to GHG accounting (Greenhouse Gas Protocol, 2020). Difference is that Scope 3 standard is intended for corporate level emission review, where product standard only refers to an individual product. The result from each standard supports the other one if company decides to conduct it separately (Greenhouse Gas Protocol, 2011).
The product standard includes guidance for accounting and reporting of GHG emis- sions. Like on LCA, emissions are presented in CO2 eq. using GWP of 100 years.
Companies are instructed to report 6 different emission: methane (CH4), nitrous oxide (N2O), sulfur hexafluoride (SF6), perfluorocarbons (PFCs) and hydrofluorocarbons (HFCs) and other GHGs included in the inventory. Standard urge to set appropriate business goals before starting to work with the life-cycle assessment to see what the
actual target of the work is and requires companies to analyze carefully which product will be choose for review. GHG protocol divides products and service in two categories:
final- and intermediate goods. Final goods are the ones that will be consumed as is by the end user. Intermediate goods are inputs to other goods or manufacturing. These can be considered as an input to the life cycle of the final product. This variation comes out when defining the unit of analysis of the target product (Greenhouse Gas Protocol, 2011). The standard has created strict boundary definitions as it requires all the at- tributable processes to be included in review. If some process will be excluded from the review, it must be stated in the final report and if all the following circumstances are presented:
- There is no primary or secondary data available - data determination is not possible
- the data gap is negligible.
Non-attributable processes are not required in the system boundary. Processes that are significant, companies should report data source, data quality and how to improve the quality in connection with the final report. Standard does not take a stand which processes should be classified significant, which means company has to make that de- cision. Assessment should also include full life cycle “cradle-to-grave” -approach for the final products and “cradle-to-gate” -approach can be used only if the function of the fi- nal product is unknown (Greenhouse Gas Protocol, 2011).
Emission reduction targets are not mandatory when applying GHG Protocol for prod- ucts, but if company state any reduction targets, it must be mentioned and inventory re- sults and must be updated when significant changes on inventory methodology occurs.
Survey of the inventory results is advised but not obligatory. Survey conducted by third party would give the most credibility and transparence on final report to all stakehold- ers. Survey can be conducted also by first party with the condition that survey provider has no conflict of interest with product inventory. Assurance statement should include how this conflict has been avoided in case of first party survey. Standard encourage companies to create public report from the results and offers detailed structure for this.
Generally, GHG Protocol gives excellent guidelines for accurate emission accounting and reporting but it does lack the practical instructions for calculations. Standard is also quite rigid in terms of allocation and boundary settings. Instead of allocating emissions, GHG Protocol advise to expand system boundary or redefining the functional unit. Re- viewed system should also include 100% of the processes and primary data must be used when process is under company’s control or ownership (Greenhouse Gas Protocol, 2011).
2.5.2 PAS 2050
PAS 2050 is made by British Standards Institution (BSI). BSI is very traditional organi- zation with more than 100 years of experience around standardizations. Company of- fers wide range of services besides the standardization and is increasingly focused on sustainability goals together with United Nations (British Standards Institution, 2020).
PAS 2050’s first version was launched in 2008 and revised in 2011. It was the first car- bon emission related standard on product level. This standard focus more on practical matters of CF calculation where GHG Protocol concentrated more on reporting prac- tices (S.Wang, et al., 2018). The goal of PAS 2050 is to give common knowledge of CF calculations and therefore emission reduction program. It does not require any report- ing, but the guidance is created in a manner that allows companies easily report the re- sults on later stage. Even the full life cycle approach is encouraged to conduct, PAS al- lows cradle-to-gate –approach to be conducted for every product and service without any further clarifications. Standard gives two thresholds for the appropriate calcula- tions:
- All sources of emissions and removals included in functional unit (product) gen- erated during the chosen life cycle period must be included.
- At least 95% of the life cycle emissions and removals within the functional unit (British Standards Institution, 2014).
In turn, capital goods will be excluded from the calculation as a whole. These can be for example machinery, equipment and buildings used during lifecycle. It is essential to be remember that sources for energy and heat of the buildings must be included in the calculations. In addition to capital goods, standard excludes also all inputs that consist less than 1% from the total emissions (British Standards Institution, 2014).
System boundary is introduced similarly than in ISO LCA –standard but with following exclusions: human energy input, transport of consumers and employees to office/fac- tory and animals providing transport services. When conducting PAS 2050, primary data from the processes owned, operated or controlled should applied to the calcula- tions. When gathering data from all downstream processes, secondary data is applica- ble. Standard though advises primary data collection also from processes that are not under control nor owned, highlighting that this method would differentiate company’s PCF analysis from other products. Unlike the GHG Protocol, PAS does not offer accu- rate guidance what is the boundary of ownership or controlling. When conducting cra- dle-to-gate approach, at least 10% of the gathered data shall be primary data. When primary data is not available, secondary data quality rules shall be followed according
to the standard. Competent sources such as official reports from United Nations and its supported organizations should be preferred. If changes occur across the time to the product’s life cycle, reassessment should be done. Temporary GHG emissions change of at least 10 % or planned life cycle change that has at least 5 % impact to results can be considered as a change. Results are valid for maximum of 2 years (British
Standards Institution, 2014).
Practicality can be indicated from the annexes of the standard, where GWP factors and land use change values are presented. Recycled material emission equations are also introduced as well as delayed emission equation with case examples. PAS offers simi- lar assessment verification than GHG Protocol and additionally to third-party and self- verification, other-party verification is an option (British Standards Institution, 2014).
2.5.3 EPD
Environmental Product Declaration (EPD®) is an international system for verifying the life-cycle environmental impact of product or service in a comparable manner. EPD® is Swedish individual company that supports organizations to communicate these impacts in understandable way. EPD is built according to the ISO LCA –approach and addition- ally according to ISO 14025 for level III environmental declarations. EPD publish and maintain publicly available library for existing EPDs and Product Category Rules (PCR). General Programme Instructions for the International EPD System is the stand- ard to follow when conducting the assessment. Document updating is held every three years to follow the latest information around PCF and LCA methodologies (EPD International AB, 2017).
The fundamental is the same than in other standards but EPD built the guidelines around the PCRs. PCR is a group of products that are similar in terms of functions and every group has a common rule for calculating the environmental impacts of products.
PCR development is the first step of EPD® system after the demand of environmental information by stakeholder as seen in figure 5. PCR development offer guidelines based on LCA methodology and complementary rules to conduct EPD for certain prod- uct category. This includes all the relevant environmental aspects of the product during the lifecycle. If there is no applicable PCR available on EPD database, new category must be developed. This is always done by PCR Committee, led by PCR moderator.
After the PCR is launched, other organizations may use the same PCR when conduct- ing the assessment for products within the same category. Therefore, the process must
be transparent, participatory and in accordance with good internationally accepted manner. PCR is valid for 3-5 years [29].
Figure 5. EPD process flow adapted from (EPD International AB, 2017) Conducting EPD will follow after PCR is done and include following steps: LCA study based on PCR, information gathering to the EPD report, verification and registration and publication. After PCR Committee creates the appropriate LCA structure (bounda- ries, functional unit etc.) performing company will conduct the assessment in-house or with external consultant and compile the data for EPD® System verification. LCA ap- proach is mainly focused on full cycle but standard states that cradle-to-gate –ap- proach is possible for intermediate products or when the use of the product is un- known. Even the detailed LCA structure is identified on PCR –stage, the general guid- ance provides well defined system boundaries and cut-off rules. LCA stages are di- vided in three main processes and all the aspects that should be included in every pro- cess is listed in standard. Similarly, with PAS 2050, EPD also allows 95 % accuracy on total emission and exclude all emissions that are 1 % or less from total amount [29].
Data requirements are in line with other standards but with the different terminology.
figure 6 represents the relevancies between system boundary processes and minimum data requirements. Specific data (primary data) should be used every time it is availa- ble but at least from core processes, which is on-site manufacturing and data can be measured. Generic data is applicable from upstream- and downstream processes if these are not in direct control of the company. EPD slice generic data in two catego- ries: Selected generic data and proxy data. Both are collected from commonly available databases where first one has specified criteria. Latter one is used if the data cannot
fulfil generic data requirements. Emissions from proxy data is limited to maximum 10 % of the total emission of the product. PCR sets the target for data quality, which com- pany shall declare in the report (EPD International AB, 2017).
Figure 6. EPD LCA stages and data requirement (EPD International AB, 2017)
Once EPD is developed, results will be verified before publishing by EPD certified sur- veyor or accredited certification organization. If company conducts EPDs in larger scale, company may apply process certification, which allow them to prepare and issue new EPDs for registration to database. Report of the EPD is mandatory when conduct- ing the assessment and it should follow guidelines of the ISO 14020 –standard. Ones the whole process is done, the results will be published and communicated to stake- holders. International EPD® system offers logotype, certain labelling to all material re- lated to the product under assessment. This is not requirement but highly recom- mended to avoid confusing to other climate declarations or labels.
2.5.4 ISO 14067
The most recognized standard provider International Standards Organization have de- veloped Greenhouse gases. Carbon footprint of products. Requirements and guide- lines for quantification in 2013, which has been revised in 2018 and will be revised every 5 years. ISO-14067 is part of the ISO-14060 standard family, which is compre- hensive standard package for monitoring, reporting and validating GHG emissions and removals. In addition to this, standard is based on ISO 14044 as others and also sup- ported by other guidance for appropriate communication of carbon footprint. Figure 7 describes the relations on how company may utilize ISO-standards in case of carbon footprint. Terminology in ISO 14067 varies slightly as product carbon footprint is turned
