Environmental Impacts of Products: A Detailed Review of Studies

Environmental effects of economic activities are ultimately driven by consumption, via impacts of the production, use, and waste management phases of products and services ultimately consumed. Integrated product policy (IPP) addressing the life‐cycle impacts of products forms an innovative new generation of environmental policy. Yet this policy requires insight into the final consumption expenditures and related products that have the greatest life‐cycle environmental impacts. This review article brings together the conclusions of 11 studies that analyze the life‐cycle impacts of total societal consumption and the relative importance of different final consumption categories. This review addresses in general studies that were included in the project Environmental Impacts of Products (EIPRO) of the European Union (EU), which form the basis of this special issue. Unlike most studies done in the past 25 years on similar topics, the studies reviewed here covered a broad set of environmental impacts beyond just energy use or carbon dioxide (CO₂) emissions. The studies differed greatly in basic approach (extrapolating LCA data to impacts of consumption categories versus approaches based on environmentally extended input‐output (EEIO) tables), geographical region, disaggregation of final demand, data inventory used, and method of impact assessment. Nevertheless, across all studies a limited number of priorities emerged. The three main priorities, housing, transport, and food, are responsible for 70% of the environmental impacts in most categories, although covering only 55% of the final expenditure in the 25 countries that currently make up the EU. At a more detailed level, priorities are car and most probably air travel within transport, meat and dairy within food, and building structures, heating, and (electrical) energy‐using products within housing. Expenditures on clothing, communication, health care, and education are considerably less important. Given the very different approaches followed in each of the sources reviewed, this result hence must be regarded as extremely robust. Recommendations are given to harmonize and improve the methodological approaches of such analyses, for instance, with regard to modeling of imports, inclusion of capital goods, and making an explicit distinction between household and government expenditure.     

The System of Environmental and Economic Accounts—2003 and the Economic Relevance of Physical Flow Accounting

The international handbook on integrated environmental and economic accounting (SEEA-2003) provides a detailed overview of environmental accounting approaches that have been developed in parallel with the system of national (economic) accounts. In addition to natural resource stock accounts and environmental protection expenditure accounts, SEEA-2003 pays considerable attention to physical flow accounting. Expanding the national economic accounts with physical data sets facilitates the joint analysis of environmental and economic policy issues. This article discusses the main characteristics of national accounts-oriented physical flow accounting approaches and provides an overview of the kind of indicators they may put forward. Although this article is not an attempt to provide a comprehensive review of macrooriented physical flow accounting approaches, the analytical advantages of national accounts-oriented physical flow accounts are illustrated.     

Setting Priorities within Product-Oriented Environmental Policy

To focus Danish product‐oriented environmental policy, a study applying extended input‐output analysis has been performed, identifying the most important product groups from an environmental perspective. The environmental impacts are analyzed from three different perspectives—the supply perspective, the consumption perspective, and the process perspective—differing primarily in their system delimitation. The top ten environmentally most important product groups (out of 138 industry products and 98 final consumption groups) are listed for each of the three perspectives, using both total environmental impact and environmental impact intensity as ranking principles. The study covers all substances that contribute significantly to the environmental impact categories of global warming, ozone depletion, acidification, nutrient enrichment, photochemical ozone formation, ecotoxicity, human toxicity, and nature occupation. The differences in results between the three perspectives are elaborated and their policy relevance discussed. The top ten product groups account for a surprisingly large share of the total environmental impact of Danish production and consumption (up to 45%, depending upon the perspective). This implies that product‐oriented environmental policy may achieve large improvements by focusing on a rather small number of product groups. Both imported products and products produced for export in general cause more environmental impact than products produced in Denmark for the Danish market. Especially noticeable are the export of meat and ship transport. This leads to the recommendation to include specific policy measures targeting both foreign producers and foreign markets. Because of its relatively large input of labor, public consumption is found to have a much smaller environmental impact intensity than private consumption. The results confirm results of other similar studies, but are more detailed and have lower uncertainty, due to a number of improvements in data and methodology. A short presentation of the methodology is provided as background information, although this is not the main focus of this article.     

Bottom-Up Life-Cycle:Assessment of Product Consumption in Belgium

The present study shows the results and methodology applied to the study of the identification of priority product categories for Belgian product and environmental policy. The main goal of the study was to gather insight into the consumption of products in Belgium and their related life-cycle environmental impacts. The conclusions of this project on the product categories with major environmental contributions can be used to start up working groups involving stakeholders and initiate detailed product studies on the impact reduction potential that could be achieved by means of implementing product policy measures. Several ways of assessing product category environmental impacts and the effects of policy measures have been developed; 'bottom-up' or 'market-life-cycle assessment' is one of these, and we tried this approach for the situation in Belgium. Simplified life-cycle assessment (LCA) studies were conducted for representative average products within each function-based product category and the results were multiplied with market statistics. Using this approach, we found that building construction, building occupancy, and personal transport are among the major categories for Belgium. The major drawbacks of this approach are the system-level limitations and the existence of a broad spectrum of nonharmonized methods and datasets from which a sound preliminary selection had to be made. Consequently, the retrieval and selection of data was very time consuming and due to this we had to accept some major limitations in the study design. Nevertheless, the study has contributed to the development of a methodology for market-LCA and elements that can be picked up in currently ongoing and future work. The study concludes that to improve the feasibility and acceptance of this type of study there is a need for the development of a harmonized methodology on market-LCA, policy-relevant impact indicators as well as a harmonized and stakeholder-agreed-upon LCA databases.     

Toward an Information Tool for Integrated Product Policy: Requirements for Data and Computation

Integrated product policy, according to the European Union, requires reliable data on the impact of consumer products along their life cycles. We argue that this necessarily requires the development of an information tool for hybrid analysis, combining aspects of life-cycle assessment and input-output analysis. A number of requirements in the development of such a hybrid information tool are identified, mainly concerning data and computational structure. For the former, some important points of attention are discussed, whereas for the latter, operational formulas are developed.     

Using Input-Output Analysis to Measure the Environmental Pressure of Consumption at Different Spatial Levels

Input-output modeling is a useful tool for tracing environmental impacts of consumption. Because it includes impacts originating from production layers of infinite order (capturing the entire economy), input-output modeling is highly relevant for studies operating in a life-cycle context. In this article we show how the input-output approach can be used to enumerate the problem of sustainable consumption. Based on a literature survey including research done by the authors we present measures of the emissions of carbon dioxide at different spatial levels: nation, city, and household. Further, we take more environmental effects into account and introduce the concept of environmental efficiency by combining input-output modeling and data envelopment analysis. Finally, we discuss the policy relevance of the different measures. The article demonstrates that input-output modeling has a wide range of life-cycle oriented applications when combined with other data sources such as detailed trade statistics, foreign input-output and environmental statistics, and household expenditure data.     

Environmental Impacts of Products:Policy Relevant Information and Data Challenges

The research and analysis presented in this special issue shows that the same limited number of consumption categories are consistently revealed to be responsible for the largest share of environmental impact: mobility (automobile and air transport), food (meat, poultry, fish, and dairy followed by plant‐based food), and residential energy use in the house (heating, cooling, electrical appliances, and lighting). It appears that differences in impact per euro between the product groupings are relatively limited, so it is essential to reduce the life‐cycle impacts of products as such, rather than to shift expenditures to less impact‐intensive product groupings. Furthermore, the effectiveness of expenditure on material products to improve quality of life leaves much room for improvement. Environmentally extended input‐output (EEIO) tables probably form, in this field, the most appropriate information support tool for priority setting, prospective assessment of options, scenario analysis, and monitoring. A clear benefit would result from integrating the input–output (IO) tables in the report to Eurostat of the 25 individual countries that make up the European Union (EU), with other officially available information on emissions and resources use, into a 60‐sector EEIO table for the EU. This, obviously, would be the first step toward more detailed tables. Three strategies are suggested to realize the additional, desirable detail of 150 sectors or more, each achievable at an increasing time horizon and with increasing effort: (1) developing further the current CEDA EU25 table; (2) building a truly European detailed input–output table accepting the restrictions of existing data gathering procedures; and (3) as (2), but developing new, dedicated data gathering and classification procedures. In all cases, a key issue is harmonizing classification systems for industry sectors, consumer expenditure categories, and product classifications (as in import/export statistics) in such a way that data sets may adequately be linked to input–output tables.     

Sustainable Consumption of Food: A Framework for Analyzing Scenarios about Changes in Diets

This article describes the integration of life-cycle assessment methods with a new input-output model of the world economy to analyze the environmental and economic implications of alternative future diets. The article reviews findings by industrial ecologists about the energy and land required for the production and consumption of alternative foods and diets in several European countries. It also reviews attributes of foods and diets identified by nutritionists as reducing the risks of obesity and major chronic diseases related to the diets of the affluent. The predominantly plant-based Mediterranean-type diet emerges as a dietary scenario that could satisfy both sets of concerns. The likely implications for agriculture and for farm policies of a shift toward this diet from the current average diet in the United States are discussed and shown to be substantial. The one-country studies reviewed in the article provide substantial insights into the potential ramifications of dietary change. Many of the limitations of these studies could be overcome by conducting the analysis in a global framework that represented the relationships among consumption, production, and trade and the physical constraints within which they operate. Analysis of the environmental and economic implications of alternative scenarios describing healthy diets can help stimulate more intensive dialogue, debate, and action among the interested parties; such analysis can both benefit from and contribute to initiatives such as the World Health Organization's global strategy on diet and health, which intends to enlist the support of governments, corporations, and civil society.     

Environmental Footprints and Scenario Analysis for Assessing the Impacts of the Agri‐Food Industry on a Regional Economy: A Case Study in Spain

The study of the environmental footprints of various sectors and industries is increasingly demanded by institutions and by society. In this context, the regional perspective is becoming particularly important, and even more so in countries such as Spain, where the autonomous communities have the primary responsibility for implementing measures to combat environmental degradation and promote sustainable development, in coordination with national strategies. Taking as a case study a Spanish region, Aragon, and significant economic sectors, including agriculture and the food industry, the aim of this work is twofold. First, we calculate the associated environmental footprints (of emissions and water) from the dual perspectives of production (local impacts) and consumption (final destination of the goods produced by the agri‐food industry). Second, through a scenarios analysis, based on a general equilibrium model designed and calibrated specifically for the region, we evaluate the environmental implications of changes in the agri‐food industry (changes in the export and import pattern, as well as in consumer behavior). This model provides a flexible approximation to the environmental impacts, controlling for a wider range of behavioral and economic interactions. Our results indicate that the agri‐food industry has a significant impact on the environment, especially on water resources, which must be responsibly managed in order to maintain the differential advantage that a regional economy can have, compared to other territories.