VALUATION FOR LIFE CYCLE ASSESSMENT OF WASTE MANAGEMENT OPTIONS by

This study describes and evaluates the various schemes available for weighting the different impacts of alternative waste management options, including landfill, composting, re-use, recycling and source reduction. The context of the study is life cycle assessment (LCA), which seeks to describe and quantify the impacts on the environment, both in terms of resource use and emissions or wastes, of a product, process or policy. There are four stages of life cycle assessment: goal definition, inventory, impact assessment and improvement assessment. Impact assessment can be divided into three main parts: classification, characterisation and valuation. Classification involves the classification and aggregation of the environmental loadings of the inventory stage into categories. These categories are then characterised by aggregation of the impacts on the basis of equivalency factors. Finally, the valuation step requires the assignment of relative values or weights to the various impacts and impact groups. Weighted impacts may then be added to derive an indicator, or possibly more than one indicator, of overall impact. The interpretation of LCA results for policy purposes is not straightforward. Policy concerns are often wider than those determined by materials and energy impacts, as addressed by LCA and can include disamenity effects for example. In addition, LCA does not incorporate matters such as the cost of production or disposal, which will also be relevant. Finally policy may be better directed at dealing with some impacts as they arise, for example pollution generated from energy used in product manufacture may be better addressed with a regulation or tax relating to energy use, rather than a measure directed at the product. Valuation methodologies can be classified as either distance-to-goal techniques, environmental control costs, economic damage approaches, or scoring techniques. The first three methods may be regarded as instances of implied social weighting: that is weights are ‘revealed’ via the political process of setting environmental standards or via explicit or implicit market valuations. The last method, scoring approaches, differs from the first three in that the constituency of the valuer is changed to that of some group smaller in size than ‘society’ generally. The methodologies reviewed in this study are classified under the four headings described above, and include Swiss ecopoints, the Tellus Institute approach, CSERGE methodology and multicriteria evaluation. They are evaluated with reference to the selected criteria (used to determine the desirability of a weighting scheme), of transparency, practicality, comprehensiveness, goal consistency and goal acceptability. Rather than settle on any one technique, a matrix has been produced to guide choice. At some risk of simplification, the matrix suggests a basic categorisation of approaches. Weights are either determined by ‘experts’ or by ‘society’. ‘Social’ weights can in turn be categorised as those determined by representative interest groups; environmental standards and goals as social consensus (including control costs as surrogates for standards); or individual preferences via opinion polls or willingness to pay. This paper reviews the experience of valuation work in waste management. Several authors have attempted to compare the relative environmental impacts of alternative waste management options but few have included a valuation of the results. The only study to include valuation was that by Powell et al (1995) which applies economic valuation to environmental externalities arising from recycling schemes. Although the selection of a valuation methodology may vary with the user group’s objectives, it is possible to produce a rank order for a waste management valuation methodology. A distance-to-goal valuation system based on environmental standards is feasible where there are clear, up-to-date and politically acceptable emission standards for all relevant emissions. However, these circumstances are likely to be rare. A second choice is therefore environmental damage costs, provided suitable economic damage figures are available. The third choice, although less representative of society than the previous two choices, is a panel which includes representative interest groups, perhaps in addition to a panel of experts.