As the focus on sustainability intensifies, companies need a clear understanding of how their decisions will impact the environment, as well as their business.
“Policy goals, consumer demands and supplier options are changing, and every change will impact the business,” said Reinout Heijungs, associate professor in the Department of Operations Analytics at Vrije Universiteit Amsterdam. “Only by exploring new directions and aiming for resilience can companies survive.”
One new direction currently in development involves combining the design, engineering, manufacturing and logistics software already used by hundreds of thousands of companies worldwide with the capabilities of life cycle assessment (LCA) databases, which estimate the environmental impacts of most business activities, from sourcing raw materials to delivering finished goods.
The goal? To provide the millions of employees who use such applications with instant feedback on the most sustainable options for the decisions they make every day: Which design will use fewer materials? Is there a less harmful chemical choice for this process? How will buying from one supplier versus another change the carbon outputs involved in transporting their products to our factory? Can we work with a supplier who has acces to renewable energy for its operations, versus one that uses coal-fired power?
LCA answers such questions using primary data that a company has collected about its own processes, alongside secondary information collected from thousands of sources. But applying LCA is a complex proposition, and the people who know how to use it and accurately interpret the results are in short supply. As a result, most companies limit their use of LCA to special projects or annual reporting of impacts that have already happened.
Integrating LCA data into product-developers’ powerful 3D computer models – known as virtual twins, or by the generic term digital twins – will make LCA insights ubiquitous and instant. By empowering every designer, engineer, manufacturing expert and purchasing agent to positively influence their employers’ environmental footprints with LCA, the data’s value and positive impact would increase exponentially.
“LCA brings the metrics needed to evaluate environmental impacts across the product life cycle. Integrating that with virtual twin technology opens new possibilities to address those impacts very early on.”Emilia Moreno Ruiz
Deputy Director, ecoinvent
As a result, rather than being used primarily to look backwards and measure past impacts, therefore, “we’re seeing a growing trend toward using LCA to assess future scenarios in supply chain management and product design,” said Emilia Moreno Ruiz, deputy director of ecoinvent, a Swiss not-for-profit organization and publisher of the ecoinvent LCA database service.
Providing decision-makers with real-time data on the impacts of their choices before they act is an ambitious goal, especially as the scope of LCA becomes more complex.
“In a vehicle life cycle, for example, the question is not just whether electricity is better than gas,” said Heijungs, a recognized global expert on LCA. “It is also about the context – urban traffic jam or freeway; timeframe, either now or under the assumption of 50% renewable electricity; level of precision – for an ecolabel you need more information than for a rough, company-internal indication; and so on. Companies also want the scope of LCA to cover impacts on ecosystem services, social impacts such as gender equality or child labor along the supply chain, and positive impacts – for instance, assessing a food product’s provision of vitamins – as well as negative effects on climate change.”
Virtual twin technology – the scientifically accurate, multi-physics 3D models that designers and engineers use to develop, test and perfect new products and processes in the virtual world – addresses that challenge by creating a digital pathway to weave LCA processes into product development, testing and manufacturing. This puts vital information in the hands of everyone involved with product design – from engineering and manufacturing to purchasing – so they can see the impact their choices will have on the environment before they act.
Democratizing LCA access
To deliver accurate insights, LCA depends on the collection and analysis of massive volumes of high-quality data from external and internal sources across the product life cycle. Dedicated environmental database providers like ecoinvent help ease the burden by providing data to fill any gaps and establish benchmarks.
To date, however, LCA has been so lengthy and complex a process, and requires so much specialist knowledge to apply, that it usually is conducted only by external consultants, constraining its use to major projects such as annual reporting.
Combining LCA with virtual twin technology, however, will put standardized environmental data at the heart of the product development process, vastly increasing the ways it can be used to ensure traceability, reliability and comparability in companies’ sustainability efforts. This enables companies to create what Deloitte, in a 2020 report, calls “right-sized” LCA projects – ones that match objectives with expected outcomes and involve internal and external stakeholders throughout the process.
For instance, LCA can enable preventive action to reduce costs and impacts by identifying hotspots and improvement possibilities early in the product-development process, including at the data collection level. By focusing on environmental issues like energy use, water-quality impacts or greenhouse gas emissions, in addition to traditional process optimization goals, LCA can help deliver additional value creation, including cost reduction and improved brand identity.
Proactive product development
The ability to focus on specific environmental impacts across the value chain could ease and accelerate LCA adoption while enabling more timely action on any recommendations. Matthias Finkbeiner and Vanessa Bach, LCA specialists at Technische Universität Berlin, argue in a 2021 article that a focus on carbon neutrality, one of the “mega-trends” of the 21st century, “offers the potential to get life cycle approaches into organizations and decision-making contexts which pure LCA did not reach yet.”
LCA ESTIMATES ENVIRONMENTAL IMPACTS AT EVERY STAGE
“LCA, combined with virtual twin technology, puts sustainability KPIs at the center of operational optimization by assessing the environmental impact at every stage of the product life cycle,” said Lauren Ing, managing director, sustainability strategy at Accenture. “For example, companies can use the technology to collect data on materials or human activities and create a highly specific twin of the system, customized to include their own suppliers, which they feed into the LCA. With visibility across the supply chain, they can use that data to do things like segment the chain, [or] prioritize and work with selected partners. That can enable business risk and operational and sustainability benefits.”
An eye on the future
Integrating LCA with virtual twin technology also empowers companies to look into the future. By combining accurate data with simulation and predictive capabilities on a single platform, companies can empower their employees to routinely assess the sustainability impacts of their design, supplier, manufacturing and logistics choices before they commit.
“Early in the design phase, companies can assess the possibilities and integrate criteria that will be relevant much later in the product life cycle,” ecoinvent’s Moreno Ruiz said. “That could mean including smart city parameters in the design of a building, or integrating factors like emissions or scarcity of elements needed for batteries early in the design of a car. Companies can use LCA to prepare for compliance with regulations that are on the horizon. They can test innovative technologies and eventually use LCA and virtual twins to promote them.”
Ultimately, integrating virtual twin technology with LCA data and tools is meant to enable truly democratized decision-making.
“LCA brings the metrics needed to evaluate environmental impacts across the product life cycle,” Moreno Ruiz said. “Integrating that with virtual twin technology opens new possibilities to address those impacts very early on. It enables companies to put multi-criteria environmental assessments – such as carbon emissions, water or resource scarcity – at the heart of product design from the earliest stages. This will greatly increase efficiency, decrease the environmental impacts of products and help to accelerate movement toward circular product life cycles.”
Learn more about the combination of virtual twins and LCA