Ratio, Sum, or Weighted Sum? The Curious Case of BASF’s Eco-efficiency Analysis

Abstract

Eco-efficiency is generally defined as the ratio of an economic and an environmental variable. This interpretation is also cited in connection to its most popular implementation, known as the "BASF eco-efficiency portfolio analysis". There is, however, something strange about this. A ratio is easily visualized as a slope, but BASF's method is working with a distance, which can be formulated as a weighted sum, not as a ratio. Upon closer analysis, it further shows that the two variables receive equal weight. These findings are contradicting the ISO 14045 standard and the perception in mainstream literature. We discuss the relevance of this shift of viewpoint. We also discuss some of the extensions, namely, the socioefficiency analysis and the SEEbalance. We finally investigate the recent changes that were introduced in the eco-efficiency method, including an eco-efficiency index, and conclude that these changes have been reported in an incomplete way, or in documents that are difficult to trace. Effectively, this means that the most popular way to calculate and visualize eco-efficiency is unverifiable, impeding its status as a science-based method for sustainable industry support. We end by sketching the path forward.

Comment on “Catalyst- and additive-free sunlight-induced autoxidation of aldehydes to carboxylic acids” by H. Shi, J. Li, T. Wang, M. Rudolph and A. S. K. Hashmi, Green Chem., 2022, 24, 5835

“…However, the concepts of green chemistry are inherently complicated to integrate and put into the same perspective as it has different meanings for different people, and the underlying guidelines are subjected to different interpretations. 27,28 For example, chemistry performed at room temperature without catalysts under sunlight is not necessarily green if the solvent is released in the environment, the reaction yields depend on the weather, and a long reaction time is necessary.…”

Eco-Efficiency as a Decision Support Tool to Compare Renewable Energy Systems

“…According to the ISO 14045 standard, EE is defined as an indicator to measure the environmental impacts of one product system compared to the value of another product system [25]. Over the years, the EE calculation evolved, resulting in plenty of variations of these metrics [10]. A considerable research effort is dedicated to applying the EE in various contexts [12,[26][27][28].…”

“…Instead, the purpose of the EE is to provide a single metric to compare different energy systems, computed from the CF and the LCOE. This approach is not new anymore and is applied in Suh, Lee and Ha (2005) [10,29]. Heijungs (2022) describes this procedure, particularly relevant for customer or clients that aim to minimize both their environmental impact and their costs at the same time [10].…”

“…Another alternative to avoid overlooking costs or environmental impacts is ecoefficiency (EE), representing a relationship between any economic and environmental variable, e.g., in the form of a ratio [10]. The EE was already applied for comparison of the different European electricity grid mixes.…”

A novel life cycle assessment and life cycle costing framework for carbon fibre-reinforced composite materials in the aviation industry

“…determining the weights of different criteria by preference) and potential inconsistencies between judgement and ranking criteria (Miah et al 2017 ). Eco-efficiency (EE) analysis (Heijungs 2022 ) is another standard method to compare the techniques or choice of alternatives by integrating LCC and LCA. This method has been demonstrated in many sectors, such as chemical sectors (Mangili and Prata 2020 ), household goods (Rüdenauer et al 2005 ) and solid waste management (Abrate et al 2014 ).…”