JLCA NEWS ENGLISH EDITION MAR.2012

No.13

JLCA
NEWS LETTER

Life-Cycle Assessment Society of Japan

LIME2

Life-cycle Impact assessment Method based on Endpoint modeling

Chapter 0 - Introduction

LIME2_ Introduction_2012

LIME2
Life-cycle Impact assessment Method
based on Endpoint modeling

Introduction
written and edited by

Dr.Norihiro ITSUBO(Associate Professor, Faculty of Environmental and Information Studies,Tokyo City University)

Dr. Atsushi INABA(Professor, Faculty of Engineering, Kogakuin University)

LIME2_ Introduction_2012

Introduction

Social Backgrounds and Research Trends
Contents
Social Backgrounds and Research Trends ................................................................................. 1
0.1 International trends in LCIA research ................................................................................. 2
Column 0.1-1 .................................................................................................................... 10
0.2 Current situation of environmental assessment methods and trends in the use of LIME . 12
0.2.1

LCA ..................................................................................................................... 12

Column 0.2-1 .................................................................................................................... 14
0.2.2

Environmental efficiency and factors.................................................................. 21

0.2.3

Environmental accounting, cost-benefit analysis, full-cost assessment, material
flow cost accounting ........................................................................................... 25(1)

Environmental accounting................................................................................... 25(2)

Cost-benefit analysis ........................................................................................... 27(3)

Full-cost assessment ............................................................................................ 29(4)

Material flow cost accounting ............................................................................. 31

0.2.4

Green GDP, sustainability indexes ...................................................................... 32

0.3 Conclusion......................................................................................................................... 35

LIME2_ Introduction_2012

Introduction
Social Backgrounds and Research Trends•

Number of registrations for ISO14001 examination: 22,527 (Jan. 2007) (Ministryof the Environment 2007)•

Number of companies that issued environment reports and CSR reports: 933(2005)*1 (Ministry of the Environment 2007)•

Number of companies that conducted environmental accounting: 790 (2005)(Ministry of the Environment 2007)•

Number of commodities for which ecomark was certified: 4,726; number ofcertified companies: 1,665 (Sep. 2007) (Japan Environment Association 2007a)•

Number of products registered for the environmental label type III (EcoLeaf): 471(Mar. 2008) (Japan Environmental Management Association for Industry 2008)•

Number of companies that participated in Eco-Products Exhibition: 600*2; numberof visitors: 164, 903 (Dec. 2007) (Eco-Products 2007 Secretariat 2008)•

Companies implementing or considering implementing LCA: 41% of listedcompanies, 24% of unlisted companies – 32% on average (Ministry of theEnvironment 2005)

As shown above, many companies have disclosed results of environmental activities invarious ways. This indicates that, because of social recognition of the construction ofsustainable society as the largest challenge in this century, many business entrepreneursconsider social contribution through environmental activities to be essential forcontinuing their businesses.
Environmental activities carried out under the strong leadership of managers must bereported to society, such as consumers and business partners. However, it is difficult
to convey the results of companies’ environmental activities. For example, if
companies carry out activities for reducing the emission of CO2 or NOx or the amountof waste and actually reduce environmental burden, they cannot express it in a way easy
for consumers to understand, such as resultant relaxation of temperature rise or increasein space for disposal. Most recipients of information are general consumers andbusiness partners, not environmental experts. Although companies spend a lot of costs
for environmental activities to fulfill corporate social responsibility (CSR), suchactivities might not be evaluated properly if the resultant effects are not conveyed
accurately.
Externally provided information on developed environmental-friendly products and*1*2

About 30% of the companies that gave valid responses (about 60% in the case of listed companies) issued environment reports.
Of the companies that participated in the Eco-Products Exhibition, about 30% have carried out LCA (Itsubo et al. 2007).

1

LIME2_ Introduction_2012

corporate environmental activities must be easy for everyone to understand. Because
qualitative expression is not sufficiently persuasive, tools and methods for quantitative
assessment are needed.
LIME was developed as a method for supporting LCA and other environment
assessment tools smoothly and with high precision. LIME has been used in various
fields since the publication of the first version (hereinafter referred to as “LIME1”).
This chapter first describes the development of LCIA research and trends in the use of
LIME.

0.1 International trends in LCIA research
Since LCIA drew international attention as the main step of LCA, the methodology andthe use have been developed actively.*3 This section examines the development of
LCIA so far. Table 0.1-1 shows comparison between LCIA trends overseas and inJapan.
Year
1980s

1989

1990

1992

1993

1994

1995

*3

2

Table 0.1-1: Development of LCA and LCIA overseas and in Japan
Overseas
Japan
Concepts of corporate management focusing on the
Mainly, energy analysis
environment, such as corporate eco-balance, wereintroduced.
SETAC held workshops on LCA. Since then, Europe
SETAC has held regular meetings for presentation of
LCA researches.
The eco-scarcity method (Ahbe et al. 1990) was
published and drew attention as the forerunner of the
DtT method.
CML published an LCA guide (Heijungs et al. 1992)
Yoshioka et al. (1992) published an
and proposed main characterization factors.
environment analysis method that uses
the input-output table.
EPS was published (Steen et al. 1992) and drewattention as an economic assessment method for
LCIA.
SETAC published the Code of Practice (Consoli et al. Japan participated in ISO’s preparation
1993), which contributed to the firm establishment ofof LCA international standards.
LCA framework.
ISO began discussions about preparation of LCA
Concrete examples of inventory
guidelines.
analysis were published.
Wuppertal Research Center proposed alternative
Chemical Economy Research Instituteindexes for environmental impact (Schmitd-bleek(1993) published an energy analysis
1993). The concept of factor was spread over the
research report concerning basic
world.
materials.
The eco-scarcity method was revised (Braunschweig1993).
Plastic Waste Management Institute(1993) published LCI data on plastic.
Europe SETAC arranged the methodology of LCIA
The 1st International Conference on(Udo de Haes, et al. 1994). The relation with risk
EcoBalance was held. Domestic LCA
assessment was strengthened.
research began in earnest.
Eco-indicator 95 was published (Goedkoop 1995).
LCA Japan Forum was established. The
This promoted proposal of many DtT methods.
necessity for LCA infrastructure was

LCIA is one step of LCA.

For the characteristics of LCA and trends in the use of it, see “0.1.1 LCA.”)LIME2_ Introduction_2012

Year

Overseas
ExternE was published (EC 1995). External
assessment of power plants was conducted.
Nordic Guideline (Lindfors et al. 1995a, 1995b) was
published and drew attention as guidelines LCA and
LCIA.

1996

1997

1998

SETAC established a working group of LCIA experts
and published a document about the current situationof LCIA research (Udo de Haes 1996).
Ecological footprint (Wackernagel 1996) was
proposed. The concept of environmental capacity
drew attention.
EPA summarized the significance of LCA and ways ofuse of LCA (Curran 1996).
Guinée et al. (1996) developed characterization
factors by the use of USES, a fate analysis method forchemical substances.
UNEP (1996) disclosed a document that summarized
the current situation of LCA and ways of use of LCA.
The international standards of ISO 14040 (1997) were
published, and the framework of LCA wasestablished.
CED (cumulative energy demand) was proposed as analternative index for environmental impact(VDI-Richtlinien 1997).
The importance of regional assessment ofenvironmental impact was pointed out (Krewitt et al.
1999, Potting et al. 1997, Huijbregts 2000).
The importance of introduction of damage assessment
for the objects of protection into LCIA was pointedout (Müller-Wenk 1997). Loss of life expectancy andothers were mentioned as useful damage indexes.
The development of Eco-indicator that shifted to
endpoint modeling began (Goedkoop 1997)
Denmark announced the Environmental Design ofIndustrial Products (EDIP) for LCIA as a result of anational project (Hauschild et al. 1998).
A damage assessment method for health impact by theuse of DALY as a damage index was proposed(Hofstetter 1998). Assessment factors werecategorized based on environmental ideas.

A revised version of ExternE was published (Holland
et al. 1998). Assessment of heavy metal and ozone andJapancommonly recognized.
Nagata et al. (1995) proposed an
integration method that uses
questionnaires
National Institute for Resources andEnvironment developed LCA software
NIRE-LCA
Japan Environmental Management
Association for Industry (1995)
conducted LCI for refrigerators.
National Research Institute forMaterials and the Society of
Non-Traditional Technology (1995)
prepared inventory data about metalmaterials.
The 2nd International Conference on
EcoBalance was held.

JIS Q 14040 (1997) was published.
Domestic standards were establishedaccording to ISO.
LCA Forum issued a report thatsummarized the domestic situation of
LCA. Proposals specified thereinbecame bases for LCA Project.

Matsuzaki et al. (1997) developed theJapanese version of USES andcalculated the characterization factors of
toxic chemicals.

The Environment Agency issued“Guidelines for Life Cycle Inventory
Analysis” and introduced case studies
on beverage containers
LCA Project (Ministry of Economy,
NEDO, JEMAI) started. A data
provision system by the use of LCI
database and web base was developed.
At the same time, the development of
LIME started.
Yasui (1998) proposed the time
consumption method.

3

LIME2_ Introduction_2012

Year

Overseas
assessment of uncertainty were added.

1999

SETAC LCIA Working Group issued a document thatsummarized trends in research on LCIA (Udo de Haes
et al. 1999).
Eco-indicator 99 was published (Goedkoop et al.
1999). An integration method based on endpoint
modeling. Development of research on damage
assessment became active.
EPS version 2000 was issued (Steen 1999). Revised
version of the economic assessment method based on
endpoint modeling.
Development of a method for assessment of damage
from noise was attempted (Müller-Wenk 1999).
International standards of ISO 14042 (2000) were
issued as a result of long-term discussions.

2000

2001

2002

Development of an LCIA method for land use andbiodiversity drew attention (Kollner 2000, Lindeijer
2000, Meent 1999, etc.)
Discussions about the relation between damage
assessment and characterization became active. EPA
held a workshop to discuss the characteristics of both.
CML published a revised version of LCA Guide(Guinée et al. 2001), which explained both damage
assessment and characterization. LCM that used LCA
for corporate management drew attention, and 1st
International Conference on LCM was held.
UNEP/SETAC Life Cycle Initiative was inaugurated.
Three groups (LCI, LCIA, LCM) were established.

Discussions for fusion between damage assessment
and characterization began in Holland (Goedkoop etal. 2002).

2003

EPA announced LCIA method TRACI (Bare 2002), acharacterization method suitable for environmental
conditions in the US.
IMPACT 2002 (Jolliet et al. 2003) was published.
Methodology was created, focusing on
characterization and damage assessment.
A revised version of EDIP (Potting 2003) was
published. Attention was paid to a characterization
method at the local level, and the list of factors bycountry was shown.

4

Japan
Development of a LCIA method withconsideration for environmental
conditions in Japan drew attention(Moriguchi 2000, Matsuno et al. 1999,
Itsubo 1998, 1999)

At the 4th International Conference on
EcoBalance, many participantspresented results of discussions fordevelopment of damage functions.
Research Group for Comparison among
Containers (2000) conducted LCA for
packaging containers. The time
consumption method was used for
LCIA.

Environmental efficiency andenvironmental accounting drewattention, and LCIA method began to be
used for them.
At the 5th International Conference on
EcoBalance, a presentation was madeabout framework of a method based on
endpoint modeling and damage
assessment (Inaba et al. 2002,
Nakagawa et al. 2002, Hayashi et al.
2002, Itaoka et al. 2002, Nagata et al.
2002, Hirosaki et al. 2002, Uchida et al.
2002, Itsubo et al. 2002).
AIST (2002a, 2002b, 2002c, 2003a,
2003b) held workshops on the LCIA
method five times.
The list of factors for LIME1 waspublished at the end of LCA Project(Japan Environmental Management
Association for Industry 2003).
Discussions were held to apply conjoint
analysis to LCA.

LIME2_ Introduction_2012

Year

Overseas
ISO/TR 14047 (2003) was issued as a collection of
LCIA cases.

2004

Discussions were held about European research
institutes’ joint project for relating characterization todamage assessment (Recipe Project).

2005

A revised version of ExternE Project was issued,
including the range of integration factors for CO2 andothers.
ISO rearranged ISO 14040 to 14043 and issued ISO
14040 and ISO 14044.
2nd-term UNEP/SETAC LC Initiative began. The
concept of the LC approach was proposed.

2006

Japan
Japanese LCIA method began to be
used for domestic companies’
environmental impact assessment.
2nd-term LCA Project began.
JEPIX (Japanese Eco-scarcity method)
was published (Miyazaki 2003) and wasused for assessment of companies’
environmental performance.
The 6th International Conference on
EcoBalance was held.
Institute of LCA was established. The
1st annual meeting was held. LIME1
Guide was issued (Itsubo et al. 2005).
2nd-term LCA Project ended. The list offactors for LIME2 was disclosed.
The 7th International Conference on
EcoBalance was held. Main contents ofresearch for LIME2 were published.

[First half of the 1990s: Issuance of the LCA Guide and proposal of acharacterization method]
The history of LCIA began in the second half of the 1980s when the Society ofEnvironmental Toxicology and Chemistry (SETAC) adopted LCA as a research theme
and began to discuss LCA research regularly at annual meetings. In the 1990s, pioneerorganizations issued documents regarded as LCIA guides one after another to construct
the framework of LCIA. A list of characterization factors for each impact category
was disclosed by Leiden University’s Institute of Environmental Sciences (CML) in
Holland in 1992 (Heijungs et al. 1992) and by North European countries in 1993
(Lindfors 1995). These guidelines not only cited from other documents the Global
Warming Potential (GWP) (IPCC 2001), the Ozone Depletion Potential (ODP) (WMO
1999), the Photochemical Ozone Creation Potential (POCP) (Derwent et al. 1996), andothers but also contained originally developed factors, such as acidification, human
toxicity, and biological toxicity. At the same time, SETAC issued the Code of Practice(Consoli et al. 1993) and concretely showed the names of impact categories of LCIA.
Through this publication, the concept of LCIA was created – that is, correlating theamounts of potential impact on impact categories, such as global warming and ozone
layer destruction based on inventory.
Later, such a method was called“characterization,” and ISO considered this a mandatory element of LCIA (ISO 14044
2006).
With regard to weighting methods for environmental impact, the eco-scarcity method(Ahbe et al. 1990, Braunschweig et al. 1993) and environment priority strategies (EPS)(Steen et al. 1992) were developed or proposed in Switzerland and Sweden respectively.
However, because both methods directly related environmentally damaging substanceswith single index without via characterization, their relation with the above-mentioned
characterization methods was weak.
In response to the publication of guides and various research cases concerning LCIA,
ISO established TC (Technical Committee) 207 in 1993 and began discussions for the5

LIME2_ Introduction_2012

creation of international standards for LCIA, a component of LCA. After that, LCIA
was widely recognized as one of the main steps of LCA, and research activities for thedevelopment of methods became more active.
[Second half of the 1990s 1:

Attention to and criticism of weighting methods]

In the second half of the 1990s, methods to fuse characterization and weighting were
proposed. While countries were developing such methods, the limits of weighting
were pointed out, and the signification of integration was discussed. With regard tocharacterization methods, methodological problems were pointed out, such as
consideration for regional characteristics and introduction of fate analysis, andresearches for solving such problems became active.
Eco-indicator 95, which was published in 1995 by Goedkoop (1995), aims to carry out
integration by dividing the result of characterization by the amount of annual impact tomake it non-dimensional, and multiplying the result by the weighting factor for each
impact category. This method drew attention as a method to fuse characterization andintegration, which traditionally had been examined separately. The distance-to-target(DtT) method (see Column 3.1-1) was adopted to calculate the weighting factor fromthe ratio of the current amount of impact to the expected amount of impact after
reduction. After that, because the DtT method can relatively easily set weighting
factors, many integration methods that adopted the DtT method were proposed (forexample, Hauschild et al. 1998, Lee 1999, Itsubo 2000, Matsuno et al. 1999). In
addition to the DtT method, methods for weighting impact categories based onquestionnaires to consumers or expert discussions were proposed (such as Nagata et al.
1995, Yasui 1998).
With progress in the development of methods, it was recognized that individuals’
subjective judgment of value would be inevitably introduced into weighting. Although
the single index gained through integration facilitates the interpretation of the result,problems remain in the reliability and representativeness of assessment results.
Because of this, when ISO prepared international standards for LCIA, a lot of
discussions were held about whether to recognize integration as a step of LCIA.
According to ISO 14044 (former ISO 14042), which provides the procedure forcarrying out LCIA, one of the most important matters is that a certain view waspresented about what characterization and integration should be. That is, thecharacterization method that can be developed only by the use of knowledge of naturalscience was regarded as a mandatory element, while the step of weighting that contains
the developer’s and the practitioner’s judgment of value was regarded as an optional
element, although it was recognized as an element of LCIA. In this way, integration
was clearly discriminated from characterization. The international standards of LCIA
that contain the above-mentioned matters greatly contributed to the prompt
dissemination of LCIA. ISO 14040 and 14044 specify the general procedure,
framework, and requirements of LCIA, but do not specify any specific methodology or
way of use. Concrete ways of using LCIA methods and showing results are explainedin a report (TR 14047*4).
*4

6

TR: Technical Report

LIME2_ Introduction_2012[Second half of the 1990s 2: Improvement of characterization factors and proposalof damage assessment]
In the second half of the 1990s, discussions were held to solve problems in thecharacterization factors proposed so far. With regard to the traditional characterization
factors that deal with chemical substances, consideration was hardly given to therelation with the processes from the emission of a substance to the exposure of it (whichis called “fate and exposure analysis”). As for fate analysis, because a lot of
discussions had already been held concerning risk assessment and atmosphericenvironment, characterization factors were developed with consideration for theproperties of chemical substances through examination for reflecting the results of the
discussions in LCIA methods (Guinée et al. 1996, Matsuzaki et al. 1997, Hertwich et al.
1999, Hauschild et al. 1998). Moreover, because, even if inventory is the same, actual
environmental impact differs among emission regions, it was pointed out that the spatialdifferences of environmental impacts should be taken into consideration for LCIA. As
a result, a lot of researches began to deal with this problem (Potting 1997, Krewitt et al.
1999, Huijbregts 2000). A revised version of the impact assessment method developed
by Hauschild through Denmark’s national project (EDIP) included a list of
characterization factors for each country concerning local impact categories, such asacidification and eutrophication.
Meanwhile, discussions for the development of integration methods reached a turning
point when many arguments arose against the method for integration through weighting
among impact categories based on the result of traditional characterization (this method
was called “midpoint modeling”). Müller-Wenk et al. (1997) pointed out that, toimprove the transparency of weighting, it is necessary to conduct the assessment ofdamage to endpoints before weighting. Hofstetter (1998) adopted as a damage index
the Disability Adjusted Life Year (DALY) used by the World Health Organization(WHO) as an index for health impact and developed frameworks whereby the impact ofcarcinogenic substances and air polluting substances can be assessed by the use ofknowledge of natural science. Many of these frameworks were adopted in a revised
version of Eco-indicator (Goedkoop et al. 1999). After these proposals were made, themethodology of using the result of damage assessment for weighting (which is called“endpoint modeling”) rapidly drew attention. Moreover, research and development ofa damage assessment method that serves as a base for an endpoint-type LCIA method
has drawn the greatest attention as a new LCIA research field.
[Second half of the 1990s 3: Beginning of development of a Japanese LCIA
method]In the first half of the 1990s, most of the LCA researches and investigations in Japan
dealt with LCI, whereas few researches were conducted for the development of LCIA
methods. It was not until the second half of the 1990s that attention was drawn to thedevelopment of characterization factors based on the environmental conditions in Japan(Moriguchi 2000) and the development of weighting methods (Itsubo 2000, Matsuno etal. 1999, Nagata et al. 1995, Yasui 1998). However, it could not be said that they fully
followed the rapidly growing level of LCIA research in Europe.
In 1995, to improve the domestic level of LCA promptly through active exchange of
information among the parties concerned, the LCA Society of Japan(JLCA) was
7

LIME2_ Introduction_2012

established (secretariat: Japan Environmental Management Association for
Industry(JEMAI)). The members of the Forum, which mainly consist of industrial,academic and government persons concerned with LCA, prepared an LCA forum reportand an LCA policy statement to make suggestions about the measures to be taken by
Japan in the future. In response to the suggestions, the LCA National Project wasstarted by the Ministry of Economy, Trade and Industry(METI), the New Energy andIndustrial Technology Development Organization (NEDO), and JEMAI. The LCA
National Project conducted the development of LIME in addition to the development of
an inventory database authorized by industrial associations and the construction of adata system whereby data can be obtained through the Internet. Main research results
at the time of the development were published mainly at International Conferences on
EcoBalance and workshops (sponsor: National Institute of Advanced Industrial Scienceand Technology), activating exchanges with users and academic experts.
[2000s 1: Full-scale development of damage assessment methods]
After Müller-Wenk and Hofstetter pointed out the importance of damage assessment,
the development of damage assessment methods became active. Müller-Wenk
developed damage factors to assess the health impact of road traffic noise. Hofstetterand Krewit developed them to assess the health impact of air polluting substances.
Cretattz developed them to assess the health impact of toxic chemicals. They all
adopted damage indexes based on the loss of life expectancy. Moreover, damage
factors were developed by Lindeijer concerning the impact of land use on plant growth,by Meent concerning the impact of chemical substances on the extinction of species,
and by Goedkoop et al. concerning the impact of acidification and eutrophication on thedisappearance of plant species (Lindeijer 2000, Meent 1999). In Japan also, the resultsof researches on the development of damage assessment methods were frequently
presented at International Conferences on EcoBalance and other meetings. With thedevelopment of damage assessment, damage assessment was required to be clearly
distinguished from characterization. The revised version of the LCA Guide that CML
published in 2001 contained lists of factors recommended for both characterization anddamage assessment concerning each impact category.*5 At a workshop held by the US
Environmental Protection Agency (US EPA) for discussions about the usefulness ofcharacterization and damage assessment, it was recommended that the two methods beused according to their purposes, supplementing each other, because they have different
advantages and disadvantages. The damage assessment method for LIME2 is
explained in Chapter II “Characterization and Damage Assessment Methods,” while
details of damage indexes are explained in Section 1.4.3 “Definition of Damage Index.”[2000s 2: Development of methods based on endpoint modeling and economic
assessment methods]
While damage assessment methods were actively developed, integration methods
shifted from the approach to weighting across the results of characterization to theapproach to weight across damage assessment results. All the main LCIA methods
developed recently, including LIME, EPS, ExternE, Eco-indicator 99, and Impact 2002,
are based on endpoint modeling.
According to the CML Guide, characterization is called “midpoint approach,” while damage assessment is called “endpoint approach.”
Many European countries follow this.

*5

8

LIME2_ Introduction_2012

The indexes for integration results are classified into non-dimensional indexes or
economic indexes. Economic indexes have been adopted for an increasing number of
research cases. This is because of the following:
1) Because economic indexes are suitable for daily living activities, communication
can be facilitated.
2) Environmental economic researches have reached a sufficient level to be applied tointegration methods for LCIA.
Of the above-mentioned integration methods based on endpoint modeling, LIME,
ExternE, and EPS use economic assessment methods.
Explanation of the methods based on endpoint modeling and detail of environmental
economic assessment can be found in 1.2 “Theme oriented method and damage
oriented method” and 3.2 “Environmental economic assessment and conjoint analysis,”
respectively.
[2000s 3: Diversification of assessment]
Although LCA has so far been firmly established as a method whereby 1) companies
assess 2) products 3) from the viewpoint of the environment, the entity that conducts
assessment, the object of assessment, and the viewpoint for assessment have been
diversified with the development of LCA researches and an increase in social concern.
In the second-term LCA National Project of Japan, an LCA method was developed tosupport local governments’ decision making on environmental policies. This method
included the development of tools for calculating environmental impact directly or
indirectly accompanying attraction of companies and for selecting waste disposal bases,
optimizing them from environmental and economic aspects.
In addition, because of an increasing concern in CSR, the momentum toward
comprehensive assessment of corporate activities as a whole increased, and more than
700 companies disclosed environment reports and CSR reports. Many of the reports
quantitatively showed the results of environmental activities by the use ofenvironmental accounting and environmental efficiency indexes, and inventory
databases for LCA and LCIA methods were used for the assessment of the results.
Moreover, because, with the promotion of environmental efficiency and the use offactors, interest increased in the development of indexes that integrate economic andenvironmental aspects, domestic companies proposed original indexes and used themfor internal decision making and external information disclosure. In addition, to fulfill
CSR, they were required to develop methods for quantitatively assessing TBL (Triple
Bottom Line) – that is, environment, economy, and society – from the viewpoint of life
cycle.
[2000s 4: Development of interdisciplinary interaction]
Although LCA researches have so far been carried out mainly in developed countries,
such as European countries, the US, and Japan, activities for infiltrating the idea of life
cycle into developing countries have become active. In UNEP/SETAC Life Cycle
9

LIME2_ Introduction_2012

Initiative, to promote LCA promptly in developing countries, a working group of LCA
researchers was established to collect and arrange the results of leading researches.
The Japan External Trade Organization (JETRO), the Asian Productivity Organization(APO), and the Asia-Pacific Economic Cooperation (APEC) held LCA seminars several
times for government officers and environmental experts in Asian countries to support
the introduction of LCA positively. In response to this, China, South Korea, Thailand,and Malaysia began national projects for creating inventory data for LCA. India,
African countries, and South American countries also held international conferences on
LCA, resulting in full-scale international exchange of information on LCA researches.
In Japan also, LCA researches have been recognized as a part of environmental science,and the Institute of LCA was inaugurated in 2006. The Institute of LCA is expected tolead society as a scientific institute that provides guidelines for realizing a sustainable
society.

Column 0.1-1
Process of life cycle assessment according to ISO 14044

Figure 0.1-1: General procedure for life cycle impact assessment(prepared by the author based on ISO 14042)
S: substance; E: inventory; I: impact category; C1: characterization result; NI: normalization result;
SI: integration result; CFI,S: characterization factor in impact category I; NVI: standard value in impact categoryi;WFI: weighting factor(1) Selection of an impact category, a category indicator, and a characterization model
Identify an impact category (such as global warming), a category indicator index associatedwith it (such as infrared radiation [W/m2]), and a model used for assessment (such as the
IPCC model) beforehand. If these are shown in a report, the transparency of assessment
results will be secured.
(2) Classification
10

LIME2_ Introduction_2012

Allocate the results of LCI among the relevant impact categories. This results in the
allocation of two or more environmentally damaging substances in each impact category. If
an environmentally damaging substance contributes to two or more impact categories,
allocate it to all the relevant impact categories (for example, NOx is allocated to bothphotochemical oxidant and acidification).
(3) Characterization
Potential impact on an impact category differs depending on the substance. Taking into
consideration this difference, calculate the potential environmental impact of the productsystem on each impact category. Calculation consists of conversion of the units for the LCI
results into a common unit and cumulative addition of the results. A characterization factor
is used for this conversion (for example, GWP in the case of global warming). This enables
aggregation of LCI results for each impact category instead of each substance as before andclarifies which substance gives the largest contribution in the target impact category.
(4) Normalization
Normalization is carried out to understand the relative strength of the product system subject
to assessment. Calculation is carried out by dividing the result of characterization by thereferential datum (for example, the annual impact in Japan). The result is indicatednon-dimensionally (for example, the degree of contribution to the environmental impact ofthe product subject to assessment on the total impact in Japan). This clarifies what impact
category receives a large contribution from the object of assessment.
(5) Grouping
Grouping is allocation of impact categories to one or more groups. Depending on purpose,
the allocated impact categories are rearranged or ranked. Because there are various impact
categories, grouping is carried out as a measure to facilitate the interpretation of assessment
results.
(6) Weighting
The weighting factor established based on the sense of value is used for converting various
impact category results and, if possible, putting them together into a single index. In manycases, a single index is derived by multiplying the result of normalization by anon-dimensional weighting factor.
(7) Qualitative analysis of data
This is carried out to extract processes and data that have important influence on LCIA results
or to obtain information on the uncertainty or sensitivity of LCIA results. Concretely, Pareto
analysis, uncertainty analysis, and sensitivity analysis are used. The result of the analysis isused for obtaining guidelines for carrying out LCA repeatedly.
Of them, (1) to (3) are defined as essential elements because they are within the extent ofassessment by the use of knowledge of natural science, while (4) to (7) are considered
optional elements because they can be effective depending on the practitioner’s purpose, but
subjective judgment of value is inevitably introduced.
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LIME2_ Introduction_2012

Although many LCIA methods have been proposed because of the development of LCIA
research, there was a period when excessive information made it difficult to understand thecontents or put them into practice. ISO’s standardization of LCIA procedures greatly
contributed not only to the promotion of practitioners’ understanding of LCIA but also to theprevention of establishment of too many of approaches LCIA methods.

0.2 Current situation of environmental assessment methods and trends inthe use of LIME
Although LIME was developed as an environmental assessment method for LCA, it canbe used for other environmental assessment tools on condition that data corresponding
to inventory should be obtained. Table 0.2-1 shows environmental assessment tools
for which LIME can be used. Various environmental assessment methods proposed so
far can be divided by the object of evaluation, such as products, companies, and otherentities; society, countries, and the world. In addition, they can be divided into those
for assessing environmental impact and those for gaining economic indexes. Because
LIME can be used not only as an environmental impact assessment method but also as
an economic assessment method through integration, it is applied to various methods
shown in Table 0.2-1. This section describes trends in the use of LIME for eachenvironmental assessment method.
Table 0.2-1: List of assessment methods for which LIME can be used
Object of assessment
Product
Company
Society, country, world
Use as an environmental LCA, environmental
Environmental performance
Sustainability index
impact assessment
efficiency, factor,
assessment, environmental
cost-benefit analysis
efficiency, factor
Use as an economic
Material flow cost
Environmental accounting
Green GDP
assessment method (for accounting (MFCA),
measuring social cost)
cost-benefit analysis,full-cost assessment

0.2.1 LCA
Environmental burdens occur through economic activities. For example, when oil orcoal is burnt as energy, CO2 and SO2 are produced through acidification of the carbon
and sulfur contained in the oil or coal. They cause environmental impact, such as
global warming, acidification, and air pollution. Even for the purpose of solving
environmental problems, people cannot fully escape from their current lives.
Therefore, people are required to continue their lives at a sustainable level by reducing
environmental burdens while maintaining current standards of living. This requires acomprehensive review of all products and services and finding a way to reduce the total
amount of environmental impact effectively.
LCA is a tool for assessing environmental burdens and environmental impact
quantitatively at all the life cycle stages of the target product, ranging from collection of
raw materials to the acquisition of materials, and the manufacture, use, disposal, andrecycling of the product. The use of LCA enables the acquisition of useful information
on which product is environmentally predominant and what matters should be
previously discussed to reduce the environmental burden of the target producteffectively. The company can use the information for determining environmental
12

LIME2_ Introduction_2012

management policy through distribution of it to the staff or to publicly announce that its
product is environmental-friendly.
It is said that the use of LCA began in the 1970s. At that time, LCA was conducted on
beverage containers and other simple products. In Japan, LCA began to draw attention
in the 1990s and has rapidly become popular in recent years. Table 0.2-2 shows main
LCA research cases presented at meetings of the Institute of Life Cycle Assessment.
As shown in the table, LCA has been applied not only to energy, materials, and simple
products but also to home electronics, office equipment, transportation machinery suchas railroads and automobiles, structures such as houses and buildings, and large andvery complicated industrial products. Recently, many assessment cases have been
specialized in the venous sector, such as recycling and waste disposal, and have also
covered industries other than manufacturing, such as e-learning and information andcommunications technology (ICT) as well as agriculture and fishery.
LCA began to draw a lot of attention when it was recognized as a useful support tool forthe construction of companies’ environment management systems (EMS) and ISO
began to standardize the general procedure for LCA. The standards for LCA,
ISO14040 to 14043 * 6 have already been published as international standards.
Although the standards have not specified the details of methodology, they show thestructure of LCA and the minimum requirements for LCA, greatly contributing to theinternational promotion of LCA.
Because the original purpose of LCA is to obtain information for reducing
environmental impact effectively, it was expected to be used for companies’
decision-making on optimization of supply chain and process and selection of parts andmaterials. Recently, however, LCA has been frequently used as a tool for companies’
showing the environmental superiority of their products.
A typical case isEnvironmental Label Type III. The Japan Environmental Management Association for
Industry registered and published LCA results about more than 450 products throughthe system of Ecoleaf, its environmental label.
Table 0.2-2: Main LCA research cases presented at meetings of the Institute of LCA:
2005 (first meeting), 2007 (second meeting)
Category
First meeting
Second meeting
EnergyCoal-based clean energy, micro hydraulic Biomass energy, DME manufacturing,
power generation, portable fuel power
woody biomass power generation, woody
generation by use of biomass, storage
biomass fuel for transport, power generation
battery, micro fuel battery
technology, home cogeneration system
Material/simple
Stationery, woody resources, eco material, Alumidoross MFA, copper/cooper alloy,
product
stainless steel, precious metals, iron/steel concrete material, textile products,
industry, bio-plastic, bio-toilet
eco-electric wire, PLA white tray, clothing,consumer durables
Electric/electronic Mobile phone, solder, IC package,
Printed board, ICT system, TV conference,machineryrefrigerator, automatic vending machine, washing machine, dry cleaning, replacement
air conditioner, home lighting, electronic of energy-saving home electronics, lighting
equipment, network infrastructure
equipment, ICT solution, e-learning, TV,
PC, assessment of mobile phone including
recycling, piezoelectric element (fine*6

ISO14041, 14042, and 14043, which specified the requirements for the tasks from the setting of the purpose and the scope of research tothe interpretation of the result, were reviewed and reissued as ISO14044 in 2006.

13

LIME2_ Introduction_2012

Category

Houses/buildings

Transport/large
products

Recycling

Beverage/food,agriculture,
fisheries

First meeting

Second meeting
ceramics), lithium ion battery, pellet stove,cost-benefit analysis of electronic equipment
Wood house, construction material,
Concrete material, local structural wood,adhesive, housing energy consumption,
processing/assembly of structure, structuralconcrete materialmaterial, woody construction material,school, biomass conversion plant, particle
board, LCA for heat island measures,factory assessment
Ship, aircraft, medium-weight passenger Large pump, energy-saving railway, traffictransport means, LRT system, large pump system, passenger transport system, VOC
absorbing wall material, passenger car, land
use traffic model, TV conference
Automobile, PET bottle, general waste
Livestock excreta disposal system, fooddisposal, final disposal site, methane
waste, PET bottle, sewage treatment system,
ferment digestive disposal, urban venous waste flow analysis of Aichi International
system, forest waste use, garbage, zero
Exposition, waste incineration system,emission project, construction waste, beer construction waste, used mixed plastics forcase, FRP disposal, battery
home electronics, home electronics, plastic,solid waste disposal, waste edible oil,sewage system, clothing, waste construction
wood, water disposal equipment,intermediate waste disposal technology,
garbage biogasification
Beverage supply system, distribution/sales Dairy farming, rice, wheat flour, bread, beanof soft drinks, recipe of pasta,oil, white sugar, strawberry jam, tomato,
environmental household account book,marine products, pork production,
consumption behavior analysis, agriculture environmental burden of dining out,on Miyako Island, squid fishingenvironmental burden of cooking, farm
production system, draft beer barrel andsales system, domestic thinning, water use
systemColumn 0.2-1
Procedure for carrying out LCA
ISO14040 and 14044 specify the procedure for carrying out LCA and the requirements forusing LCA. According to them, LCA consists of the following four steps:(1) Setting the purpose and the scope of research
Clarify the purpose of LCA and determine the scope of research. The scope of research
includes not only the scope of the assessment process but also , impact categories, and theassessment models.
(2) Life cycle inventory analysis (hereinafter referred to as “inventory” or “LCI”)
Calculate the environmental burdens of all the related processes and find the amount ofenvironmental burden of the whole life cycle by summing up the burdens while considering
the connections among them. The result is expressed in terms of physical amount, such as
quantity, concerning each environmentally damaging substance.
(3) Life cycle impact assessment (hereinafter referred to as “impact assessment” or

14

LIME2_ Introduction_2012“LCIA”)
Assess the amount of potential environmental impact that can be caused by the environmental
burden. Assessment may be made of potential contribution to an environmental problem,
such as global warming, or the amount may be expressed by a single index through weightingof various environmental impacts. The manner of expressing the result varies among thesteps of LCIA or depending on the evaluation method.
(4) Life cycle interpretation (hereinafter referred to as “interpretation”)
Based on the results of the analysis and assessment so far, consider what process, substance,
or impact category is important. Moreover, examine the reliability of the data used for LCA,
centering on especially important processes and assumptions. If necessary, reexamine it toimprove the accuracy. Draw a conclusion from these results. For detailed explanation of
LCA, see Editorial Committee on an Introduction to LCA Practice (1998), Adachi et al.
(2004), Ishikawa et al. (2001), and Itsubo et al. (2007).
ISO divides the LCA procedure into several steps (see Column 0.2-1). Among them,inventory analysis takes the most time and effort for the LCA practitioner. If inventory
data on electric power and basic materials used for many products are open to the public,
the time for the analysis will be halved by effective use of the data.
The same applies to impact assessment. If the impact assessment methods approvedby domestic experts are open to the public, companies can obtain LCIA results
consistent with the purpose by merely applying the inventory data on their products
without developing an impact assessment method.
During the first-term National LCA Project, which began in 1998, the Ministry of
Economy, Trade and Industry and NEDO considered constructing an LCA database,including the following:•

Highly representative inventory data supplied by industrial associations•

Highly reliable LCIA method developed under the participation of environmental
scientists and academic experts•

Network system that can effectively deliver the results of the above-mentioned
research and development and continue to update data

The results of the consideration were reflected in the national LCA database managed
by LCA society of Japan Forum. Practitioners became able to collect data through theInternet easily, which promoted companies’ use of LCA.
Moreover, in thesecond-term National LCA Project launched in 2003, the use of the database for LCA
was examined through case studies, with the result that venous inventory data and theimpact assessment method were updated and regional LCA was newly carried out.
Since 2006, a program for disseminating the results of research and development so far
among small and midsize companies has been carried out.
LIME1 and LIME2 were developed through the above-mentioned project. Manycompanies have already begun to use LIME for the LCA of their products. As shown15

LIME2_ Introduction_2012

in Table 0.2-3, LIME has been used in various fields, such as electric and electronicequipment, transport equipment, construction and construction materials, recycling, andservices. The following are main cases:
Table 0.2-3: Main LCA cases by the use of LIME
Object of assessment
Practitioners
TV, display
Iiyama, Toshiba, Musashi Institute of Technology
Refrigerator
Toshiba, National Institute of Advanced Industrial
Science and Technology (AIST)
Washing machine
Hitachi
Air conditioner
Toshiba Carrier
Cleaner
Toshiba
Stove
Nagano Prefecture
Hot-water system
Noritz, Toshiba Carrier
Mobile phone
AIST, Toshiba, Musashi Institute of Technology
HDD player
Toshiba
Audio player
Toshiba
Dish washing/drying device
ToshibaRice cooker
Toshiba
Warm-water toilet seatToshibaLighting equipment, lamp
Toshiba
Office equipment, parts Inkjet printerCanon, Seiko Epson
Memory stickSony EMCS
IC package
Shinko Electric Industries, Ibiden
Fuel battery
Fujitsu Laboratories
Color fadable toner
Toshiba
Note PC
Fujitsu, Toshiba
Scanner
Toshiba
CopierMatsushita Electric, Ricoh
Liquid-crystal projector
Seiko Epson, Hitachi
Liquid-crystal panel
Samsung
Digital camera
ToshibaTransport equipment
Automobile
Japan Automobile Research Institute, Toyota
Motor, Nissan Motor, AIST
Automobile parts
Japan Auto Parts Industries Association
Railway
Railway Technical Research Institute, Nagoya
University
Ship
National Maritime Research InstitutePublic works,
BridgeTaisei Corporation, Hanshin Expressway
construction,
VOC absorbing wall material INAX, Musashi Institute of Technology
construction materials
Recycled construction material Sekisui Chemical
Cement, concrete
J-Power
Commercial facilities
Tokyu Construction
Sash
TostemInterior decorating sheet
Toppan Printing
Urethane
Bridgestone
Elevator
Toshiba
Solar snow melting system
Solar System
EnergyElectric power
Tokyo Electric Power, Kansai Electric Power,
Chubu Electric Power
Gasoline, light oil
Nippon Oil Corporation
Biodiesel
AIST
Material, simple products Adhesive
Aica Kogyo, University of Tokyo
Paint
Kyowa Hakko
PET bottle
Dai Nippon Printing
Industry name
Home electronics

16

LIME2_ Introduction_2012

Steel canPaper cup
Containers and packaging
Garbage bag
Lead-free solder
Wood, thinning
Daily necessities

Toyo Seikan
Printers Association of Japan
Nisshin Seifun
Nippon Film
HitachiTokyo University of Agriculture and Technology,
Musashi Institute of Technology
KaoUnicharm

Detergent
Disposable diaper, sanitary
items
Recycling, waste disposal Waste wood recycling
National Institute for Environmental Studies
Waste plastic
AIST
Livestock excreta disposal
AISTsystemFood waste recycling, garbage AIST, Musashi Institute of Technology
recycling technology
Zero emission project
University of Tokyo
Demolition waste
AIST
Home electronics recycling
Musashi Institute of Technology
Sewage disposal
Musashi Institute of Technology
Service
PC lease
NEC Lease
ICT solution
Fujitsu Laboratories
Washing, dry cleaning
University of Tokyo
Other
GuitarYamahaAgriculture
National Institute for Rural Engineering
Unfreezable faucet
Takemura Seisakusho

The Japan Automobile Research Institute (Funazaki 2006) integrated environmental
impacts on gasoline automobiles and diesel automobiles. The result is shown in
Figure 0.2-1. Changes in environmental impact were assessed from the 1990s to thesecond half of 2000. In the 1990s, because the health impact of the emission ofsuspended particulate matters (SPM) was serious, diesel automobiles generally had
greater environmental impact. However, because of the strengthening of regulations
and accompanying improvement of environmental technologies, the emission of air
polluting substances was reduced. Moreover, by following the post new long-term
regulation applied from 2009, the environmental impact of diesel automobiles becamealmost the same as that of gasoline automobiles.
Dai Nippon Printing Co., Ltd. (Fujimori 2004a) conducted LCA of PET bottles by theuse of LIME (Figure 0.2-2). Although the demand for PET bottles has increased, thedemand for reduction in environmental burden and cost also increased due to anincrease in raw material cost. The company confirmed that the environmental impact
of PET bottles was reduced by about 30% by the following measures: 1) the weight of a
PET bottle was reduced by reduction in thickness; 2) improvement of transport
efficiency by transport of products before molding; and 3) reduction in power
consumption by replacing heat sterilization with filling in a sterilized room.
The National Institute of Advanced Industrial Science and Technology (Sagisaka et al.
2006) used LIME for LCA of biofuels (Figure 0.2-3). Because carbon neutral, which
offsets the emission of CO2 caused from the use of fuels by the amount of carbon fixed17

LIME2_ Introduction_2012

Figure 0.2-1:

Environmental impact integration result of automobiles(gasoline vehicles and diesel vehicles) (Funazaki 2006)

Although at present diesel vehicles have greater environmental impact due to the emission of diesel exhaust,
their environmental impact will decrease to almost the level of gasoline vehicles’
because of technological development and measures for environmental regulation in the future.

Raw materials

Manufacture

Distribution

Use

Disposal

8.00E+02
7.00E+02
6.00E+02
5.00E+02
4.00E+02
3.00E+02
2.00E+02
1.00E+02
0.00E+00-1.00E+02-2.00E+02
Clean room filling typeTraditional typeFigure 0.2-2: Environmental impact integration result of PET bottles(clean room filling type and traditional type) (Fujimori 2004)
It was confirmed that, although the clean room filling type has a great impact at the time of filling (use),
the environmental impact as a whole can be reduced by reducing the weight of raw materials
and improving the efficiency of distribution.

18

LIME2_ Introduction_2012

Figure 0.2-3:

Result of LCIA of bioethanol (Sagisaka 2006)

Although Biofuels have a relatively low impact on warming through being carbon neutral, they have agreat impact on human health due to the impact of land use on the ecosystem and urban area air pollution.

at the time of cultivation, can be applied to biofuels, biofuels are thought to be effective
for global warming. However, in addition to urban area air pollution, such as NO x,
SO2, and particulate matters (PM), biofuels have potential impact on land use forcultivation, indicating that environmental impact would increase as a whole.
Toshiba (Kobayashi 2004) has applied LIME to the assessment of the color fadable
toner and used the results for the calculation of factors. This product requires erasing
equipment for reuse of paper. However, even if the environmental burden of the use of
the erasing equipment is taken into account, the reuse of paper has a greater effect of
reducing environmental impact. Therefore, the introduction of the color fadable toner
is highly significant (Figure 0.2-4).
INAX and the Musashi Institute of Technology (Kaneko et al. 2007) used LIME for the
LCA of housing wall material that absorbs formaldehyde indoors. As shown in Figure
0.2-5, although this material has a great environmental impact when products are
manufactured through incineration, it absorbs formaldehyde, a carcinogenic substance,at the stage of use, greatly contributing to the reduction of indoor air contamination.
Therefore, it was assessed as contributing to the reduction of environmental impact onlife cycle as a whole. In addition, although vinyl cloth, with which the wall material
was compared, has a small environmental impact at the stage of production, it wasthought that the formaldehyde emitted from the adhesive has a great impact at the stageof use. Therefore, it was estimated that the use of adhesive that reduces formaldehyde
can reduce the environmental impact to a similar degree as the material that absorbs
formaldehyde.
Although the density of formaldehyde emitted from construction materials can be
reduced by increasing the number of times of ventilation, an increase in the number
19

LIME2_ Introduction_2012

raises energy consumption, which may worsen global warming or air pollution.
Chapter IV explains the result of analysis of construction materials with consideration
for people’s lifestyle.

Figure 0.2-4:

LCIA result of a color fadable toner

It was verified that the effect of promoting the reuse of paper (ecosystem conservation, etc.) islarger than an increase in the impact due to the introduction of an eraser.

Figure 0.2-5: Result of environment impact assessment of formaldehyde-absorbing
construction materials and vinyl cross (Kaneko 2007)
Environmental impact can be greatly reduced by the use of VOC-absorbing construction materials andadhesives that reduce the consumption of formaldehyde.

20

LIME2_ Introduction_2012

In Japan, LCA has often limited substances subject to analysis mainly to CO2, NOx, andSO2. However, according to the results of the case studies explained herein, analysis
limiting to the small number of environmentally damaging substances, such as CO2,
found that environmental impact was not fully grasped concerning some products.
Because LIME enables the assessment of 15 impact categories and 1,000 substances, it
is expected that the scope of LCA will be broadened and that the possibility can befound to grasp all the important environmental impacts that have so far been
overlooked.
0.2.2 Environmental efficiency and factors
LCA is used for assessing the environmental aspect of products. However, it is
impossible for profit-making companies to continue their businesses when only
environmental aspect is taken into consideration. Therefore, it is important for them tobalance economy with the environment. Environmental efficiency is an attempt to
express the relation between the two by use of indexes. Environmental efficiency
indexes were proposed at the “United Nations Conference on Environment andDevelopment” held in Rio de Janeiro in 1992. The World Business Council for
Sustainable Development (WBCSD) defines environmental efficiency as “constructionof society that provides competitively priced goods and services that satisfy humanneeds and improve quality of life, while reducing impact on the ecosystem andresources to an environmentally acceptable level through minimization of resource
consumption and environmental burden and maximization of services.” As an index
plainly indicating this definition, environmental efficiency is generally expressed as theratio of the value of a product or service to its environmental impact (formula 0.2-1).
Value of product, etc.
Environmental efficiency =Environmental impact of product, etc.
(0.2-1)In the case of an air conditioner, for example, a function, such as the cooling capacity(how much space), or an economic index, such as the price or the values added, is usedas the numerator. Meanwhile, what is used as the denominator is the emission of CO2,
the result of characterization for an impact category, such as global warming, or the
result of integration. However, because the numerator often differs in dimension fromthe denominator, a non-dimensional factor produced by comparison between theenvironmental efficiency of the new product and that of the former product is often
used.
Value of assessed productEnvironmental efficiency of assessed product (new product)=

Factor =Environmental efficiency of base product (former product)

Environmental impact of assessed
product
Value of base productEnvironmental impact of base product(0.2-2)
There has been a growing trend toward the use of factors and environmental efficiency
as in-house environmental management indexes.
According to the Japan
Environmental Management Association for Industry (2004), a total of 67 companies
have introduced an environmental efficiency index and its factors at the corporate level
21

LIME2_ Introduction_2012

and at the product level as environmental management indexes (Table 0.2-4).
Environment efficiency and factors, it is important to find the elements of each index.
Although there are cases where environmental efficiency is calculated for each type ofenvironmentally damaging substance, such as CO2 and resource consumption, thisincreases the number of items of assessment results and reduces the clarity as acommunication tool. As a result, an increasing number of companies use theenvironmental impact integrated by LIME as the denominator for environmental
efficiency. Table 0.2-5 shows cases where business activities were assessed fromenvironmental efficiency, etc. by the use of LIME.
Table 0.2-4: Companies that have introduced environmental efficiency indexes and factors(Japan Environmental Management Association for Industry 2004a)(Unit: number of companies)
Environmental efficiency/factor-introducing
companies

Manufacturing
Nonmanufacturing
Total

Environmental reportissuance
confirmation
Product levelcompanies
317
12
106
1
423
13

Company level
41
13
54

Table 0.2-5: Assessment cases by the use of LIME for environmental efficiency and factors
Company
Object of assessment
Index
Definitional formula
PeriodTokyo Electric Business activities
Environment
Sales / environmental
1990-2006
Power
efficiency
impactChubu Electric Business activities
Environmental
Environmental impact /2000-2004
Power
burden index
electric energy soldKansai Electric Business activities
Environment
Business profit /1990-2006
Power
efficiency
environmental impact
J-POWER
Business activities
Environmental
Electric energy sold /1990-2006(group)efficiency index
environmental impact
Nippon Oil
Business activities (16 Environment
Product production /2002-2006
main group companies) efficiency
environmental impact
MaruzenBusiness activities
Environmental
Sales / environmental
2001-2005
Petrochemical
efficiency index,
impacteco-efficiency index
Mitsubishi Gas Business activities
Environmental
Sales / environmental
2002-2004
Chemicalefficiency
impactToshiba
Toshiba business
Factor T
Sales / environmental
2001-2006
activities (group)
impactToshiba
Products (49 types)
Factor T
Value factor x
Comparison
environmental impact
with basereduction factor
product
Fujitsu
Note PC
Factor X
Service (comparison
1996 and 2003
between new and former
products) / environmental
impact (comparison
between new and former
products)
Nikkei BP
Publishing
Environmental
Environmental impact
2004
performance
Unicharm
Business activities
Environmental
Sales / environmental
2004- 2006
(group)efficiency
impact22

LIME2_ Introduction_2012

Company
Lion
AIST
AIST
AIST

Object of assessment
Index
Business activities
Environmental(group)efficiency
State, company
Environmental
efficiency
Mie Prefecture Crystal Environmental
Town Project
efficiency
Digital camera
Environmental
efficiency

Definitional formula
Sales / environmental
impactValue added /environmental impact
Local effect /environmental impact
Product value /environmental impact

Period2000-2006
Single year
20 years
Product life
cycle

Figure 0.2-6: Examples of disclosure of environmental efficiency results(a) Nippon Oil: continuous improvement in environmental efficiency;(b) Tokyo Electric Power Company: disclosure of changes in environmental efficiency for 17 years from 1990

As shown herein, companies engaged in energy, such as electric power companies andoil companies, have been actively using LIME for the assessment of environmental
efficiency. Nippon Oil (2007), Maruzen Petrochemical (2007), Tokyo Electric Power(2007), Kansai Electric Power (2007), and Chubu Electric Power (2004) calculated theenvironmental impact caused by their activities and product production or production
output in the past five to fifteen years and examined secular changes in environmental
impact by comparison between the two. As an example of the application of LIME toenvironmental efficiency, Figure 0.2-6 shows the results of assessment obtained by
Nippon Oil and Tokyo Electric Power. The figure indicates that, because Nippon Oil
increased environmental efficiency by more than 10% in the seven years from 1996, theyear of start of research, to 2003, it continued to consider the balance between theenvironment and economy. Tokyo Electric Power disclosed the results of calculationof environmental efficiency over 17 years. Although environmental efficiency
decreased for some time due to suspension of nuclear power generation, it is indicatedthat environmental efficiency has risen in the long term because of technologicalimprovement.
Toshiba (2007) calculated factors by calculating environmental efficiency for various
new products and comparing it with former products’ environmental efficiency. Figure
0.2-7 summaries the result of calculation of factors for 49 items. The figure expresses
the environmental impact reduction factor and the value factor with the vertical andhorizontal lines, respectively. The characteristics of product groups were clarified by
dividing the groups into a group of products whose environmental impact improved
greatly, a group of products whose value increased greatly, and a group of groups whose
23

LIME2_ Introduction_2012

environmental impact and value improved synergistically. Details of the results havebeen published in an environment report and pamphlet prepared separately.
The National Institute of Advanced Industrial Science and Technology (AIST) proposedan environmental efficiency index that is an integration index whose numerator anddenominator are value added and environmental impact respectively (Itsubo et al. 2004).
The index enables the comparison and assessment of the state, companies, and products
under the same concept (Figure 0.2-8). Adoption of value added enables its
calculation by deducting the direct material cost from GDP in the case of the state, theprofit and loss statement in the case of a company, and sales in the case of a product.
For example, the state’s environmental efficiency index can be regarded as the meanvalue of environmental efficiency for all products and business activities in Japan. If
this index is prepared beforehand, it will be possible to assess whether or not the resultof analysis of the environmental efficiency of business activities or a product isrelatively good. The straight line passing through the origin in the figure indicates theaverage for the whole state. If a product exists above the line, its environmental
efficiency is relatively high. Because the value-added rate differs among industries
and groups of products, this figure cannot show which product is superior, but makes it
possible to gain a guide for improvement of the environmental efficiency of a product.
For example, in the case of a refrigerator, the environmental impact can be reduced by achange of the cooling medium from a specified CFC to an alternative CFC, and it ispossible to confirm that the environmental impact has been improved as a result (it has
become nearer to the domestic average in the figure).

Figure 0.2-7: Result of calculation of factors for each factor of Toshiba
Both the product value and the environmental performance are assessed. The degree and form of
improvement differ among products. Products are classified into those greatly improving in environmental
performance, those improving in value, and those improving in both environmental performance and value .

24

LIME2_ Introduction_2012

Figure 0.2-8: Environmental efficiency indexes for products and the national average
If indexes are located above the national average, the environmental efficiency is relatively high.
If value-added is adopted as the numerator of environmental efficiency,
comparison can be made among countries and among products.

0.2.3 Environmental accounting, cost-benefit analysis, full-cost assessment, material
flow cost accounting
The result of integration by LIME is expressed by economic indexes. Because
economic indexes can be used in various manners, they are often used for otherenvironmental assessment tools. Concrete examples are environment accounting,cost-benefit analysis, full-cost assessment (FCA), and material flow cost accounting(MFCA). The use of economic indexes for these methods has already begun. Table
0.2-6 summarizes cases where the external cost of LIME is used for theabove-mentioned methods. Below, the outlines of these assessment methods will be
explained and then cases of use of LIME will be described.
(1) Environmental accounting
Environmental accounting is a tool for providing (recording, measuring, and delivering)accounting information on the environment (Inanaga 2000). Through environmental
accounting, companies can gain information on how much they spend forenvironmental activities and what degree of effect they can gain from the environmental
activities. Responding to a recent increase in people’s awareness of environmental
issues, companies have spent a lot of cost for environmental conservation. Therefore,
to hold down the cost as much as possible and maximize the effect, it is extremely
important for a company to calculate each department’s expenditure and the total
expenditure and grasp what degree of social effect is worth the cost or investment andwhat degree of economic effect the company will gain.
25

LIME2_ Introduction_2012

Table 0.2-6: Cases of use of LIME for economic analysis (environmental accounting, cost-benefit
analysis, full-cost assessment, material flow cost accounting)Analysis method
Implementing body
Object of assessment
Publication medium
Environmental
Kyoto City
Water treatment system
Reportaccounting
Kansai International Airport
AirportEnvironment report
Kyowa Hakko
Business
Environment report
Cost-benefit
Nippon Oil
ENEOS Vigo, low-sulfur light Environment reportanalysis
oil
NEC
Lease
Environment report
HitachiWashing machine
Conference presentation
Fujitsu Laboratories
Note PC
Conference presentation
Full-cost
Shinko Electric Industries
IC package
Conference presentationassessment
National Maritime Research Ship
Software
Institute
AIST
Waste plastics disposal
Conference presentation
Seiko Epson
IJ printerWebsiteAIST
Local cooling/heating
ReportMaterial flow
Tanabe Pharmaceutical
Medical supplies
Reportcost accounting Nippon Film
Garbage bag
ReportSandenAluminum casting, cutting work Report
Canon
Steel/stainless processing
ReportEnvironmental accounting consists of the following three elements (Ministry of theEnvironment 2004b):•••

Environmental conservation cost: cost and investment for prevention of occurrenceof environmental burden
Economic effect accompanying environmental conservation: profit gained by acompany as a result of environmental conservation
Environmental conservation effect: environmental profit from avoidance or control
of environmental burden

That is, environmental accounting is usually conducted for each measure or project toperform cost-benefit analysis of economic activities at the corporate level and add up
the results. It differs greatly from financial accounting in that, of the above-described
three elements, the environmental conservation effect is expressed in a quantitative unit
(Ministry of the Environment 2004b). Although it takes a lot of labor for a company
to calculate the reduction amount of an environment damaging substance, the result of
calculation cannot be directly compared with the environmental conservation cost
expressed in the amount of money, because the two differ in dimension. If theenvironmental conservation effect can be converted into money, the effect on society
can be directly compared with the direct cost, which is very attractive to the user.
Some companies have already independently attempted to integrate and express
environmental conservation effect (for example, Ricoh, Fujitsu, Toshiba, and Sanyo
Electric). However, the methodology differs among the companies, and the results are
not consistent with each other. According to the Environmental Accounting
Guidelines issued by the Ministry of the Environment, although environmental
conservation effect should be expressed quantitatively in principle, economic
assessment can be used according to purpose. In addition, the Guidelines explain
LIME and other environmental economic assessment methods.
Kyoto City (2007) conducted environmental accounting for waterworks and sewerage
26

LIME2_ Introduction_2012

sites. LIME was used for the assessment of environment conservation effect. Table
0.2-7 shows the results of the assessment. When environmental conservation effect isassessed for environmental accounting, the amount of environmental burden reduction
from the previous fiscal year is often calculated. In this research, the amount ofenvironmental burden on the assumption that no measure is taken for environmental
conservation is calculated as the baseline and is deducted by the amount ofenvironmental burden in the fiscal year in question (when measures for environmental
conservation are carried out) to calculate the potential reduction of environmental
burden, which is then applied to LIME to conduct the economic assessment of theenvironmental conservation effect. As a result, it was indicated that, although theeconomic effect that accompanies environmental conservation cannot by itself fully
recover the environment conservation cost, if the economic conservation effect isincluded in the assessment, the effect of reducing environmental impact can be fully
expected on the whole.
Table 0.2-7: Environmental accounting carried out by the Waterworks Bureau of Kyoto
City (Kyoto City 2007)(Unit: thousands of yen)

Although environmental conservation effect is usually expressed in quantity, effect in this table is theresult of applying to the integration of LIME the decrease in the amount of environmental burden
estimated on the assumption that environmental conservation measures are not taken. This enabled the
direct comparison with environmental conservation cost and internal economic effect.
(Source) Waterworks Bureau of Kyoto City: Development of Methods for Assessment of theEnvironmental Conservation Measures by the Waterworks Project of Kyoto City [Report] March 2007

(2) Cost-benefit analysis
The object of environmental accounting is usually a business entity. The cost-benefit
analysis of product life cycle is called life cycle cost-benefit analysis (LCCBA). The
National Institute of Advanced Industrial Science and Technology (2007) cooperated
with the electric and electronic equipment industry to develop LCCBA as anenvironmentally friendly design method by the full use of LCA and life cycle cost27

LIME2_ Introduction_2012(LCC). Figure 0.2-9 shows the result of LCCBA of a washing machine. This figure,where the vertical line indicates environmental impact and the horizontal line indicatesthe breakdown of cost, can be used for product design to improve each aspect
effectively. For the purpose of this, a measure for saving water (introduction of awater circulation pump) and a measure for the chemical substance used for the basematerial (substitution with lead-free solder) were adopted. It was indicated that
although the introduction of these scenarios increases the direct material cost, social
benefit is large on the whole because the cost and environmental impact of water supply
and purification are reduced and the reduction of environmental impact is expected at
the time of disposal and recycling. As shown in Table 0.2-8, the final result of
LCCBA is indicated in a form similar to the indication method for environmental
accounting. This makes it possible not only to confirm changes in the environmentand costs, paying attention to each scenario for product design, but also tocomprehensively verify the effect of improving the final product in the case of adoptionof two or more scenarios. LCCBA has already been applied to some types ofequipment, such as computers and copiers, and is expected to be firmed established insociety as a tool for eco-design.

Figure 0.2-9: Assessment results of LCC and LCA on refrigerators(Yamaguchi et al. 2007)
A method to improve each aspect effectively is considered by showing environmental impact andcost. The environmental impacts of disposal and water consumption were improved greatly by thetreatment of chemical substances and water saving measures. The water saving measures inparticular had an effect on both environmental impact and cost.

28

LIME2_ Introduction_2012

Table 0.2-8: Arrangement of results of LCCBA on refrigerators

Nippon Oil (2004) used LIME for the cost-benefit analysis of the development of a new
product. The environmental burden of ENEOS Vigo, whose fuel efficiency was
improved by combination with a friction modifier, is lower than that of the existinghigh-octane gasoline. The social effect of the change to ENEOS Vigo was estimated to
be about 600 million yen on the basis of the sales in 2003. Moreover, it was indicatedthat the sale of low-sulfur light oil with less than 50 ppm of sulfur will cause a social
effect equivalent to about 175 billion yen, as compared with the existing light oil. This
greatly exceeds 6.6 billion yen, the amount of investment in the equipment for
production of the product.
(3) Full-cost assessment
In environmental accounting and cost-benefit analysis, assessment is made by thedifference between the cost of reducing environmental impact and the benefit from thereduction. In contrast, full-cost assessment (FCA) is based on the total of internal cost,which the company in question pays during product life cycle, and external cost, which
is depletion of a specific value not on the market (UNEP 2001) (Figure 0.2-10). The
cost of a product developed to reduce environmental burden may be higher than the costof the existing product because of scale of manufacture or immature skill. Because
FCA can count reduction in environmental impact, a characteristic of anenvironment-oriented product, it is possible to discuss the trade-off relation between the
disadvantages of cost rise and the advantages of social cost reduction. Here lies thehighest significance of the introduction of FCA.
Figure 0.2-11 shows the calculation result of FCA of refrigerators: a refrigerator thatuses a specified CFC (old products) and a refrigerator that uses an alternative CFC (newproducts) (Itsubo et al. 2003). Both refrigerators’ LCC were about three to four times
the social cost. Because the specified CFC has a high heat of vaporization, the power
consumption of the refrigerator using the specified CFC is low. However, because thespecified CFC strongly absorbs infrared rays and destroys the ozone layer, it causes agreat environmental impact during radiation. On the other hand, because thealternative CFC has a relatively low heat of vaporization, the power consumption of therefrigerator using the alternative CFC is high. Therefore, the cost of using the29

LIME2_ Introduction_2012refrigerator is high. However, because of the high speed of decomposition in the air,contribution to the greenhouse effect and the ozone layer destruction is lower than in thecase of radiation of the specified CFC. Because these tendencies were reflected in thiscase, the new product’s LCC was higher than that of the former product, while theformer product’s social cost was higher than that of the new product. In addition, thenew product’s overall cost was estimated to be lower than the former product’s. Thismeans that the effect of reducing the social cost by the change to the alternative CFC islarger than an increase in the internal cost.

Figure 0.2-10: Concept map of FCA
Total cost is assessed based on the total of the internal cost calculated by LCC and the external
cost calculated by LCIA.

Figure 0.2-11: Result of full-cost assessment on refrigerators
Because cooling efficiency lowers when a specified CFC is replaced with an alternative CFC, thecost of use increases. However, because great reduction in environmental impact at the time ofemission is highly effective for reducing external cost, the overall cost lowers.

30

LIME2_ Introduction_2012

When environmental issues are discussed from the viewpoint of economics, theinternalization of the external cost is often taken up. FCA has been regarded aquantitative practice of the internalization.
(4) Material flow cost accounting
Material flow cost accounting (MFCA) is a method for grasping the economic size of
waste from plants by measuring the flow and stock of manufacturing materials by
quantity and amount of money and calculating the cost of waste as a negative product(Kokubu et al. 2006). MFCA makes it possible to measure the economic value of
waste produced during each process of manufacture and to obtain measures for more
effectively making efforts, such as the improvement of manufacturing quality and theimprovement of the yield ratio (Figure 0.2-12). Since FY1999, the Ministry of
Economy, Trade and Industry has regarded MFCA as an effective method for making
the environment and economy consistent with each other and has supported thedevelopment of this method and its introduction to companies. As of FY2005, MFCA
had been used by 45 companies, mainly in the processing industry.
The reduction of waste leads to the reduction of raw material cost and waste disposal
cost. At the same time, the effect of reducing environmental impact is expected
through a saving of resources consumption and reduction of waste. If MFCA is fusedwith LIME, both of the above-described effects of waste reduction can be expressed byeconomic indexes. So far, some companies, such as Tanabe Pharmaceutical and
Sanden, have conducted research on the fusion.
Figure 0.2-13 shows the assessment results of the MFCA and LCIA conducted by
Canon. This figure shows the interrelation between the MFCA value related tonegative products and the environmental impact by LIME before and after process
improvement. It was confirmed that polyol and stainless produced as waste can be
reduced through the improvement of the processing process and that environmental
impact can be reduced through reduction of consumption of exhaustible resources andfossil fuels and reduction in the volume of landfill waste.

Figure 0.2-12: Concept map of MFCA (JMA Consultants, Inc. 2007)
The economic value of loss is visualized as a negative production cost by including the cost of waste.
Portions where loss is great are clarified by assessment of a series of processes,
and effective reduction measures are selected based on the clarification.

31

LIME2_ Introduction_2012

Figure 0.2-13: Case of assessment that fuses MFCA with LIME(JMA Consultants, Inc. 2007)
A company reduces costs and environmental impact at the same time by improving the
manufacturing process and reducing the amount of waste materials.

0.2.4 Green GDP, sustainability indexes
In 1987, the Brundtland Committee established in the UN proposed the concept of“sustainable development” as development that fulfills the current generation’s needs
without damaging the future generation’s needs. The UN’s Millennium Ecosystem
Assessment pointed out that human activities’ imposition of stress on the ecosystem has
been increasing and there is the danger of failing to support the sustainability of future
generations. Although the concept of sustainability has already existed in this way, it
has drawn special attention in the recent years when global warming and otherenvironmental problems have been widely recognized as urgent issues. The basic
concept of sustainability is intergenerational fairness. Because of this, mid- andlong-term indexes and assessment are needed to measure the degree of intergeneration
fairness.
With regard to discussions as to what social system will enable sustainable development,
increasing attention has been paid to economic discussions based on the facts andrecognition of changes in the global environment and the limitations of resources. Theinternalization of external diseconomies caused by environmental impact, which was
proposed by Pigou, is regarded the idea that will become the core of environmental
economics. Daly pointed out that since GDP contains not only qualitative increase(development) but also quantitative increase (growth), it is problematic to use GDP for
the definition of sustainability.
Under this situation, various indexes have been proposed concerning sustainability.
The genuine progress index (GPI) and the System of Environmental-Economic
Accounts (SEEA) were proposed as revised GDP indexes, from which the depletion ofnatural capital not included GDP in is deducted. However, this is used for annual
assessment at the national level, not for mid- and long-term assessment.
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LIME2_ Introduction_2012

An example of what is used for sustainability assessment by the use of LIME is thesimulation of optimal economic development in the whole world until 2100 carried out
by Tokimatsu et al. (2006). The simulation used the graphics programming
environment (GRAPE), an integrated assessment model (IAM) that interrelates macro
economy, energy systems, land use, emission of greenhouse effect gas, and climatechanges, for calculating the amount of environmental burden in ten regions in the World
dynamically and applying it to LIME’s integration factors to calculate the social cost in
the whole world. Moreover, the result was deducted from total GDP in the wholeworld to assess social sustainability. As a result, it was indicated that the external cost
will increase 2.5 times to 8 trillion yen at the end of this century, and global warming
and land use (maintenance and alteration) in particular will have great impact (Figure0.2-14). Moreover, it was indicated that although the internalization of the external
cost will decrease GWP, compared with the case where the external cost will not beinternalized, the internalization will lead to forest conservation and saving of fossil fuels(Figure 0.2-15).

Figure 0.2-14: Result of prediction of long-term environmental impact by fusing LIME into IAM
The introduction of measures that internalize external costs enables a great reduction in environmental impacts.

Figure 0.2-15: Changes in forest area, the amount of emission of greenhouse gas,and Gross World Product by the internalization of external costs
Although the internalization of external costs reduces economic value by about 5%, it promotes
forest conservation and reduction in the emission of greenhouse gas.

33

LIME2_ Introduction_2012

Column 0.2-2
Integrated assessment models (see Kurosawa 2007)
The influence of global warming extends all over the world, and the causes and measures
affect energy, agriculture, and the whole economic system. From 1990, model development
was promoted to consider comprehensive measures against the environmental problems that
accompany global warming. Models should have the following characteristics:
1) Inclusion of various elements, such as the mechanism of climate changes, energy, landuse, influence of climate changes, and economy
2) Capacity to predict long-term influences, ranging from emission of greenhouse effect gas
to environmental impact3) Simultaneous treatment of top-down ways of thinking about environmental policies andothers and bottom-up approaches to production activities and technological development
Because, in this way, models need comprehensive assessment in terms of time, space, andinterdisciplinary fields, they are called “integrated assessment models.”
Most of the recent integrated assessment models deal with CO2 as a greenhouse effect gas.
Assessment reports issued by the Intergovernmental Panel on Climate Change (IPCC) also
explain the backgrounds to the models and the results of assessment by the use of the models.
In addition, since 2000, integrated assessment models that deal with types of greenhouseeffect gas other than CO2 have been developed. As a result, it became possible to discuss
the six types of greenhouse effect gas specified in the Kyoto Protocol, combining long-term
reduction measures appropriately.
Various integrated assessment models have so far been developed or proposed. Famous
ones are DICE developed by Nordhaus (2000), FUND developed by Tol (2002), and PAGE
used by Stern (2007). In Japan, AIM and GRAPE (Kurosawa) have constructed original
integrated assessment models.
For example, Stern assessed long-term economic impact of global warming by the use of an
integrated assessment model (Figure 0.2-A). According to the result, if external costs, suchas health impact, and the impact of large-scale disasters are included, the economic impact ofwarming will exceed 10% of GDP at the end of the 22nd century. On the other hand, Sternpointed out that because the cost of controlling the emission of CO2 is sufficiently low, it isimportant to carry out measures against warming early.
Figure 0.2-A: Result of assessment of
global warming’s impact on economy
by the integrated assessment model(Stern 2007)
If social and other costs are included, theimpact of global warming will exceed 10%
to 30% of GDP at the end of the 22nd
century.

34

LIME2_ Introduction_2012

0.3 Conclusion
This chapter, as an introduction, explained trends in LCIA research and the main use of
LIME. LCIA research, which became full-scale in the 1990s, developed into aninterdisciplinary research field after 2000. Research on the development of LIME
methods greatly contributed to the improvement of the level of LCIA research. The
UNEP/SETAC Life Cycle Initiative arranged the current situation of LCIA research,referring to LIME, and has been recognized as a method that is internationally leading
LCIA research.
With the securing of the international presence of LIME, LIME has been used for LCA
case studies in various ways. For example, there are many cases of assessment that
pay attention to environmental problems closely related to each product, such as indoor
air contamination by construction materials, land use by farm products, air pollution byautomobiles, and biological resources by paper.
In addition, technologicalimprovement has made it possible to assess environmental improvement effect without
overlooking important environmental impact because of comprehensive grasp ofenvironmental impact.
Because LIME is designed to assess environmental impact on the premise of theacquisition of inventory data, it has already become possible to use LIME beyond theframework of LCA. In reality, LIME has already begun to be used for various
methods, such as environmental efficiency, factors, environmental accounting, LCCBA,
MFCA, and green GDP. In conjunction with this, LIME is used for measuring not
only the environmental performance of products but also that of companies. Moreover,recently LIME has been used for assessing the prediction of environmental impact,fusing with an integrated assessment model. In the future, LIME is expected to be
used for considering sustainability, together with social impact assessment.

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