http://icarb.org/2013/05/06/5th-international-conference-minutes-and-presentations/

1. Taking a whole systems approach:
Accounting for scope 3 emissions and
avoiding unintended consequences
5th International Conference on Carbon Accounting
Edinburgh Conference Center
13th March 2013
Angela Druckman
a.druckman@surrey.ac.uk
Senior Lecturer in Sustainable Energy & Climate Change Mitigation
University of Surrey

2. Plan
• Whole systems approach and Scope 3
accounting
• A typology of unintended consequences

3. Whole Systems Approach
Life cycle stages
Life Cycle Thinking:
A way of thinking that helps organisations understand and
improve the sustainability of their products and services.
Raw Material
Extraction
Manufacturing,
Processing
& Formulation
Transportation
& Distribution
Use, Reuse
& Maintenance
Recycling, Water
& Waste
Management
3

4. Raw Material
Extraction
Manufacturing,
Processing
& Formulation
Transportation
& Distribution
Use, Reuse
& Maintenance
Recycling, Water
& Waste
Management
Material & energy Inputs
4
Emissions to land, sea, air

5. Raw material
extraction
Manufacturing,
processing &
formulation
Transportation
& distribution
Use, reuse &
maintenance
Recycling,
water & waste
management
Product/
process
design
Research &
development
Strategy &
planning
LifeCyclePhases
Pre-operation
Operation Raw material
extraction
Raw material
extraction
Manufacturing,
processing &
formulation
Manufacturing,
processing &
formulation
Transportation
& distribution
Transportation
& distribution
Use, reuse &
maintenance
Use, reuse &
maintenance
Recycling,
water & waste
management
Recycling,
water & waste
management
Product/
process
design
Product/
process
design
Research &
development
Research &
development
Strategy &
planning
Strategy &
planning
LifeCyclePhasesLifeCyclePhases
Pre-operation
Operation
Allen et al (1997)
Decommissioning
Remediation &
restoration
Life Cycle Stages
Post-operation
DecommissioningDecommissioning
Remediation &
restoration
Remediation &
restoration
Life Cycle Stages
Post-operation

6. Where is the highest
impact in this system?
Source: Gandy, S., Smith, S., Paton, W., and Aumônier, S. (2009). Review of Life Cycle Impacts of WCs.
ERM. Defra, London.

7. Life Cycle Assessment
LCA is a tool for the systematic evaluation
of the environmental aspects of a product
or service system through all stages of its
life cycle.
Raw Material
Extraction
Manufacturing,
Processing
& Formulation
Transportation
& Distribution
Use, Reuse
& Maintenance
Recycling, Water
& Waste
Management
“Cradle to grave”
& Formulation Management
or
“cradle to gate”
allowable in some
circumstances

8. • Assists in identification of trade-offs
• Avoid burden shifting
LCA as a Decision Support Tool
8
Raw Material
Extraction
Manufacturing,
Processing
& Formulation
Transportation
& Distribution
Use, Reuse
& Maintenance
Recycling, Water
& Waste
Management
8

9. Organisational Reporting
• Lack of information about supply chains;
• Limited Scope 3 reporting.

10. Source: Defra Guidance on how to measure and report your greenhouse gas emissions

11. Reporting of Scope 3 Emissions
Source: CDP Annual Report 2012

12. … without the need for detailed knowledge of
supply chain
• Environmental Input-Output Methodology
• Based on economic Input-Output Tables
– show sales and purchases between
Supply Chain Reporting
– show sales and purchases between
industry sectors

13. 2nd round
3rd round
F R G E S F R G E S F R G E S F R G E S F R G E S
F R G E S
Machinery
F R G E S
F R G E S
Iron ore for Steel
Steel for machinery
4th round
5th round
Just one
pathway of
many!
Food 1st roundResources Goods Energy Services
Paper
Wood
Alec’s Insurance
Company Adapted from Murray and Wood (2010)

14. Environmental Input-Output Methodology
• By knowing
the supply chain expenditure in each
sector by Alec’s Insurance Company,
the total output (£) of each sector,
total emissions CO2 from each sector,
we can estimate the supply chain COwe can estimate the supply chain CO2
emissions for each insurance policy sold.
• EIO is based on techniques devised by
Wassily Leontief
• Current computing power enables deeper
analysis

15. Columns: Inputs to sector (‘recipe’)
Agriculture Manufacturing Final Demand Total Output
Agriculture 20 30 50 100
Manufacturing 40 80 80 200
Labour 40 90 130
An input-output table for a two sector economy
Source: Proops et al 1993
Rows: Outputs to other sectors and to final demand
Labour 40 90 130
Total Input 100 200 130

16. Imports
• Estimating the upstream emissions due to
imported goods and services presents a
challenge.
• Domestic Technology Assumption:
– Assume that the technology used for
producing imports is same as domestic
technology.technology.
• For more accuracy need:
– Inter-industry flow A-matrix for each region
– Environmental emissions per unit monetary
output for each sector for each region
– Trade flows between all sectors for all regions.

17. Recent advances in data availability
• Multi-regional input-output datasets
– enable emissions due to imports to be
estimated with improved accuracy.
– Eora: http://worldmrio.com/
– World Input Output Database: www.wiod.org/
– Eurosat: http://epp.eurostat.ec.europa.eu/– Eurosat: http://epp.eurostat.ec.europa.eu/
– OECD www.oecd.org/sti/ind/46871875.pdf

18. Examples of toolkits to estimate
supply chain emissions
www.trucost.com/
www.sw-consulting.co.uk
www.trucost.com/
www.censa.org.uk
www.trucost.com

19. Plan
• Whole systems approach and Scope 3
accounting;
• A typology of unintended consequences:
1. Knowable and avoidable – toilet example
2. Hard to assess2. Hard to assess
© Angela Druckman 2013

20. Biofuels
• Previous studies:
– substituting biofuels for gasoline will reduce
greenhouse gases;
• Searchinger et al (2008)
– corn-based ethanol,
– instead of producing a 20% savings, nearly
doubles greenhouse emissions over 30 years.doubles greenhouse emissions over 30 years.
• What was the difference?
– Type of LCA analysis;
– Previous studies didn’t take into account the
carbon emissions that occur as farmers
worldwide respond to higher prices and convert
forest and grassland to new cropland to replace
the grain (or cropland) diverted to biofuels.
References: Searchinger et al (2008) and Brander et al (2009)

21. Types of LCA
• Attributional
– “Accounting”
– Description of existing system with all activities
leading up to product or service
• Consequential
– “Change-oriented”
– Considers possible consequences of changes in
demand or product system;
– e.g. consequential land-use change
– Insights of possible consequences often based
on market mechanisms
– May require assumptions concerning future
technologies etc
Source: Roland Clift (2012)

22. Increase in research re consequential LCA
Histogram of the number of articles published from 2002 to 2011 which contain
the word “consequential” AND “LCA” in their abstract, title or keywords.
Source: Zamagni et al (2012)

23. Systems boundaries for Attributional and
Consequential LCA
Source: Brander et al (2009)

24. Attributional v Consequential LCA
• Difference is in how boundaries are defined
– Need clear and unambiguous definition of
the goal of the study
• Consequential LCA
– How far should the chain of cause-effect– How far should the chain of cause-effect
relationships be traced?
– Which consequences should be included?
• Is there a ‘right’ or ‘wrong’ type?
Source: Brander et al (2009) and Zamagni et al 2012

25. Challenges of Consequential LCA
• Complexity;
• Transparency;
• Sensitivity to assumptions;
• Completeness?
• Accuracy?• Accuracy?
• Consequential modelling often done in a
non-systematic and inconsistent way;
(Zamagni et al 2012)
• Still under development.

26. PAS 2050:2011
• “While GHG emissions also arise from indirect
land use change, the methods and data
requirements for calculating these emissions are
not fully developed. Therefore, the assessment
of emissions arising from indirect land use
change is not included in this PAS. Thechange is not included in this PAS. The
inclusion of indirect land use change will be
considered in future revisions of this PAS.”
(page 11).

27. In the meantime, the precautionary
principle should be applied

28. A typology of unintended consequences
1. Knowable and avoidable – toilet example
2. Hard to assess – biofuels example
3. “Knowable” but unavoidable
© Angela Druckman 2013

29. Household actions - rebound effects
Lower
petrol
bills
Holiday
in
Spain
More energy
Indirect
Embodied
energy
Invest
money
saved
Lower
running
costs
Driver further
or more often
Fuel efficient - less energy
More energy
More energy
Direct
Indirect
Source: Sorrell (2007)

30. How to reinforce rebound effects…

31. Rebound for simple ‘abatement actions’
1. Household heating:
reduce thermostat by
1oC
2. Food: reduce food
waste by one third
3. Transport: replace car3. Transport: replace car
journeys <2miles by
walking/cycling
Rebound ~ 34%
Reference: Druckman et al (2011)

32. Rebound effect from
energy efficiency measures
• Cavity wall insulation
• Loft insulation
• Condensing boiler
• Tank insulation
• Energy efficient lighting
Solar thermal
Reference: Chitnis et al (2012)
• Solar thermal

33. Rebound ~11%
for combination
of measures
(excl solar
Estimated rebound effects for average UK household averaged over a ten
year period (2009-2018) with full capital costs
Reference: Chitnis et al (2012)
(excl solar
thermal) –
subsidies not
taken into
account

34. -20%
-10%
0%
10%
20%
30%
40%
50%
Subsidies for capital costs increases rebound
Rebound ~14%
for combination
Estimated rebound effects for average UK household averaged over a ten year period
(2009-2018) with subsidised capital costs
-30%
-20%
C
avity
w
allinsulationLoftinsulation
C
ondensing
boilerTank
insulation
C
FL
lighting
LED
lightingSolartherm
al
1,2,3,4
and
5
com
bined
1,2,3,4
and
6
com
bined
Income effect Embodied effect Capital cost effect Net effect
Reference: Chitnis et al (2012)
for combination
of measures
(excl solar
thermal) –
subsidies not
taken into
account

35. A typology of unintended consequences
1. Knowable and avoidable – toilet example
2. Hard to assess – biofuel example
3. “Knowable” but unavoidable – household
actions – rebound effects exampleactions – rebound effects example
4. Unknowable and unavoidable - ?
© Angela Druckman 2013

36. Summary
• Whole systems approach
– Understanding product and supply chain
– EIO, and attributional v consequential LCA
– New MRIO datasets
• A typology of unintended consequences• A typology of unintended consequences
1.Knowable and avoidable – toilet example
2.Hard to assess – biofuel example
3.“Knowable” but unavoidable –
household actions,
rebound effects example
4.Unknowable and unavoidable.
© Angela Druckman 2013

37. Selected References
• Brander, M., R. Tipper, C. Hutchison and G. Davis (2009). Consequential and
Attributional Approaches to LCA: a Guide to Policy Makers with Specific
Reference to Greenhouse Gas LCA of Biofuels. Technical Paper TP-090403-A,
Ecometrica Press.
• Chitnis, M., S. Sorrell, A. Druckman, S. K. Firth and T. Jackson (2013). "Turning
lights into flights: Estimating direct and indirect rebound effects for UK
households." Energy Policy 55: 234–250.
• Druckman, A., M. Chitnis, S. Sorrell and T. Jackson (2011). "Missing carbon
reductions? Exploring rebound and backfire effects in UK households " Energy
Policy 39: 3572–3581.
• Gallagher, E. (2008). The Gallagher Review of the indirect effects of biofuels
production, Renewable Fuels Agency.production, Renewable Fuels Agency.
• Murray, J. and R. Wood, Ed(s). (2010). The Sustainability's Practitioner's Guide
to Input-Output Analysis. Champaign, Illinois, USA, Common Ground.
• Searchinger, T., R. Heimlich, R. A. Houghton et al (2008). "Use of U.S.
Croplands for Biofuels Increases Greenhouse Gases Through Emissions from
Land-Use Change." Science 319(5867): 1238-1240.
• Sorrell, S. (2007). The rebound effect: an assessment of the evidence for
economy-wide energy savings from improved energy efficiency. London, UK,
UKERC.
• Zamagni, A., J. Guinee, R. Heijungs, P. Masoni and A. Raggi (2012). "Lights
and shadows in consequential LCA." The International Journal of Life Cycle
Assessment 17(7): 904-918.