Eco-efficiency is the ratio between the Value added of an Activity or Product and one or more of its Externalities. When applied to a product, it is as the ratio of LCC/LCIA results.
The concept may be applied to any physical measure of environmental Impact, and may then be used to identify hotspots in a Product system with high environmental impacts relative to the value added (low eco-efficiency). Whilst relevant as a tool to increase value added, it is less relevant to support overall cost reductions, since it simply provides an incentive to increase private (internal) costs and reduce external costs. This becomes obvious when expressing environmental Costs (and Benefits) in monetary units: the relevant measure to minimise is not internal/external costs but internal+external costs, i.e. total costs. Thus, when it is possible to express environmental costs (and benefits) in monetary units, eco-efficiency simply measures the level of Internalisation of costs, and loses its relevance as a tool to compare systems.
Sometimes the term eco-efficiency is used for the inverse ratio, i.e. the ratio between the environmental impacts and the value added, which implies (somewhat illogically) that a low eco-efficiency would be desirable. This use is dissuaded.
As Chief Operating Officer, Iris leads our organisational development and oversees day-to-day operations. Before joining 2-0, she worked in the biotechnology sector. As an LCA consultant, Iris has devoted her expertise primarily to the domains of sustainable agriculture and food production. She is dedicated to teaching LCA and is responsible for our educational efforts. Iris holds an M.Sc. in Biology – Biotechnology from the University of Copenhagen.
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