Chapter 3 - Corporate Perspective 3.4 Environmental Assessment Flashcards
Verbal / Argumentative Methods
Procedure
* Classifying the recorded material and energy flows
* Assessment based on selected environmental criteria
Examples
* Checklists
* Environmental Impact Assessments * Product line analyses
Suitability
* First (internal) vulnerability analysis
Ranking / Classifying Methods
Targets
* No quantitative comparison of environmental impacts
* Determine, where high environmental benefits can be achieved with relatively small effort. * Ranking
Suitability
* Systematic, comprehensive analysis of weak points in operations, processes, products (internal)
Example
* ABC-XYZ analysis
Ranking / Classifying Methods
Example ABC-XYZ Analysis
Classification of environmental relevance
* A - urgent need for action
* B - medium-term need for action
* C - no need for action
Consumption classification
* X - high consumption
* Y - medium consumption
* Z - low consumption
Classification options
Consumption classification
* Environmental hotspots
* Environmental law / policy requirements
* Social acceptance
* Potential for hazards and incidents
* Internalized environmental costs
* Negative external effects in upstream and downstream supply chain stages
* Depletion of non-regenerative raw materials / overuse of regenerative resources
External environmental costs: B) Avoidance Costs
B) Avoidance Costs
= costs that are to be spent to avoid a particular environmental impact (e.g., reduction of emissions)
– Application in case of insufficient knowledge about the environmental impact and resulting damage
– No direct link to environmental damage, but direct link to relevant environmentally damaging activity (e.g., emission avoidance costs)
External Environmental Costs: A) Damage Costs
A) Damage Costs
*Loss of benefits resulting from environmental degradation; including: – Costsofunavoidedenvironmentalandhealthdamage:
Loss of benefits and costs of environmental damage, e.g., loss of agricultural yield, reduction in recreational benefits, reduction in quality of life.
– Costsofdamagereduction:
Costs of removal measures and adaptation and mitigation costs;
Interpretable as a lower limit for the willingness of affected parties to pay for an improvement in environmental quality.
Environmental Assessment
Evaluation Methods
Verbal / Argumentative Methods
* Checklists
* Environmental impact assessments
* Product line analyses
Cost-based Evaluation Methods
* Internalized environmental costs (internalization of environmental effects, waste charges, emission certificates)
* External environmental costs (damage costs, damage avoidance costs)
Ranking / Classifying Methods
* ABC-XYZ method
Natural-Science based Methods
* Requirements of DIN EN ISO 14040
* UBA (German Umweltbundesamt) Method
* ReCiPe Method
Cost-based Evaluation Methods Cost categories:
A) Damage costs
B) Avoidance cost
Cost-based Evaluation Methods
Internalized environmental costs - 4 Approaches
-
Environmental Investment Costs:
Ex-ante project and investment calculations for decision support -
End-of-Pipe Environmental Protection Costs:
Calculating downstream environmental protection costs such as filters, wastewater treatment plants, etc. -
Material- and Energy-flow based Cost Accounting:
Systematic determination of flow costs (which are shown to be underestimated by traditional cost accounting with the cost object as the reference object) -
External Environmental Costs:
Calculating external costs that are not (yet) allocated to the company
Cost-based Evaluation Methods
Internalized environmental costs
Objectives of the determination of internal environmental costs
- Determination of expenses for corporate environmental protection
–for internal and external documentation
–for cost planning, monitoring and control
- Detection of saving potential through environmental protection projects
- Support for product development and investment calculation
- Example: Material flow-based environmental cost accounting
