Two cases of misleading environmental declarations due to system boundary choices

Published by
Presentation for the 9th SETAC Europe LCA Case Studies Symposium, Noordwijkerhout, 2001.11.14-15
Publication date
2001-01-01
Sectors

Abstract

Environmental Product Declarations (EPDs) on electricity and nitrogen fertiliser are used to illustrate how a declaration or labelling[1] based on data from the current supply chain can be misleading when the production capacity in the supply chain is constrained. Three ways of avoiding such misleading declarations are suggested.

Why system boundaries matter

An Environmental Product Declaration (EPD) reports environmental information for a product, but the data selected for the declaration may not represent the consequences of a purchase. This distinction becomes important when the production capacity of suppliers is constrained. The presentation uses electricity and nitrogen fertiliser to show how a declaration based on the current supply chain can give a misleading basis for comparison. If additional demand cannot be met by the supplier represented in the EPD, the purchase may affect other production instead. In that situation, the product system included in the assessment needs to reflect the processes that are actually affected.

Three ways to address the problem

Weidema outlines three options for avoiding misleading declarations when system boundaries and market conditions do not align:

  • Add a warning. State that an EPD should not be used to compare equivalent products. This communicates a limitation, but provides less decision support to customers.
  • Align the declaration with reality. Choose system boundaries that reflect the consequences of the purchase decision, using market-based, consequential modelling.
  • Align reality with the declaration. Change the market conditions so the declared product is supplied as described. The paper gives a separate market for environmentally preferable products, or capacity expansion linked to sales, as examples.

The central lesson is that an EPD’s usefulness for comparison depends on the relationship between its system boundary and the production affected by demand. Making that relationship explicit helps readers understand what a declaration can support and where its limitations lie.

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