LCA, LCI, LCIA, LCC: What is the difference between these terms?

Did you know that more than 80% of a product’s environmental impact comes from its supply chain? This striking fact highlights why understanding environmental assessment tools like LCA, LCI, LCIA, and LCC is fundamental for sustainable product design and decision-making.

In fact, these terms represent different aspects of analyzing a product’s environmental and economic impacts throughout its lifetime. Specifically, while Life Cycle Assessment (LCA) follows a multi-step procedure to calculate overall environmental impact, Life Cycle Inventory (LCI) focuses on data collection, Life Cycle Impact Assessment (LCIA) analyzes environmental effects, and Life Cycle Costing (LCC) examines monetary aspects.

In this blog post, we will break down each of these terms, explain their differences, and help you understand how they work together in environmental impact analysis. Moreover, let’s also explore how these tools are standardized through frameworks like ISO 14040 and EN 15804+A2 to ensure consistent and reliable results.

Life Cycle Assessment (LCA)

Life Cycle Assessment stands as a systematic method for evaluating environmental impacts throughout a product’s entire existence. This standardized approach examines everything from raw material extraction to final disposal, providing businesses and policymakers with crucial environmental data.

The ISO 14040 series structures LCA into four distinct phases:

• Goal and scope definition
• Life cycle inventory analysis
• Life cycle impact assessment
• Interpretation

Furthermore, LCA measures various environmental impact categories, including climate change, human toxicity, ionizing radiation, and resource depletion. Notably, this assessment technique quantifies both resource extraction and environmental releases across all stages.

LCA primarily serves two critical functions in decision-making processes. First, it helps businesses improve their product development and environmental communication. Consequently, sustainability advocates can assess their portfolio and determine necessary steps toward achieving carbon footprint goals.

The methodology encompasses different types, each serving unique purposes. These include environmental LCA (E-LCA), social LCA (S-LCA), and life cycle sustainability assessment (LCSA). Additionally, practitioners can conduct assessments ranging from screening LCAs for internal use to comprehensive, ISO-compliant studies for external communication.

Since its emergence in the late 1960s, LCA has evolved significantly. The tool initially focused on energy analysis but has expanded to cover broader environmental and social impacts. Through coordination among scientists worldwide, LCA has become integrated into modern policy and legislation.

Life Cycle Inventory (LCI)

The Life Cycle Inventory (LCI) represents the data collection phase where we track and quantify everything flowing in and out of a product system. This meticulous process measures raw material requirements, energy needs, and various types of emissions throughout a product’s life cycle.

During an LCI analysis, we track several key environmental outputs:

• Atmospheric emissions
• Waterborne emissions
• Solid wastes
• Resource consumption

Primarily, LCI databases serve as the backbone of environmental footprint calculations. These databases contain scientific average data about materials and processes used in national economies, enabling companies to conduct assessments even before collecting raw primary data.

The inventory analysis process essentially involves mapping the product system and linking its components to specific LCI data. Subsequently, we add up the LCI data from all sub-processes to understand the total environmental impact.

Data collection methods vary based on availability and requirements. Most data comes from direct sources like electricity bills and water consumption records. Moreover, when primary data isn’t available, we rely on industry averages or secondary data from branch organizations, financial institutes, and market research organizations.

To maintain data quality, the process includes detailed validation through established quality assurance or quality control procedures. Additionally, the collected data must comply with relevant LCI/LCA ISO standards and allow for future updates. This systematic approach ensures transparency in underlying assumptions, process boundaries, and aggregation procedures.

Life Cycle Impact Assessment (LCIA)

The Life Cycle Impact Assessment (LCIA) transforms raw inventory data into meaningful environmental impact measurements. This critical phase evaluates how emissions and resource extractions affect various environmental aspects.

LCIA operates through impact categories that group different emissions based on their environmental effects. These categories include:

• Global Warming Potential (measured in CO₂-equivalent)
• Terrestrial Acidification (measured in SO₂-equivalent)
• Human Toxicity (measured in 1,4-DB-equivalent)
• Photochemical Ozone Formation (measured in ethene-equivalent)
• Resource Depletion (measured in Sb-equivalent)

Primarily, LCIA uses characterization factors to convert environmental interventions into specific impact categories. For instance, methane emissions are converted into CO₂ equivalents when measuring global warming potential.

Several standardized methods exist for conducting LCIA analyzes. The CML methodology, developed by the University of Leiden, stands as the most widely used approach globally, particularly in the building sector. Alternatively, the TRACI methodology, created by the U.S. Environmental Protection Agency, focuses on North American data.

The ReCiPe method calculates 17 midpoint indicators and 3 endpoint indicators. Midpoint indicators address specific environmental issues like climate change, whereas endpoint indicators show impacts on human health, biodiversity, and resource scarcity. Therefore, while endpoint indicators simplify interpretation, they introduce additional uncertainty into the results.

Life Cycle Costing (LCC)

Unlike environmental impact assessments, Life Cycle Costing (LCC) focuses on the monetary aspects of a product or service throughout its existence. Research shows that construction costs typically represent only 10-20% of total expenses, with maintenance and renovations accounting for 80-90% of lifecycle costs.

LCC examines all costs from acquisition to disposal, primarily focusing on:

• Initial capital investments
• Operational expenses
• Maintenance and repair costs
• End-of-life disposal expenses

Analogous to other lifecycle approaches, LCC helps organizations make informed decisions about long-term investments. At the same time, this method proves especially valuable when comparing project alternatives that meet similar performance requirements although they differ in initial and operating costs.

Important to realize, LCC calculations must account for future expenses through appropriate discount rates. Coupled with comprehensive cost analysis, this approach enables businesses to identify opportunities for long-term savings and optimize maintenance strategies.

The methodology has gained particular significance in public procurement. Accordingly, the EU Public Procurement Directives mandate LCC evaluation for determining the most economically advantageous tender, rather than solely focusing on purchase price. This approach undoubtedly benefits bio-based products, which often have higher initial costs but may offer reduced disposal expenses.

LCC primarily serves as a robust framework for linking environmental assessments to monetary systems used by decision-makers. This integration helps evaluate progress toward sustainability goals by connecting physical environmental limits with financial considerations.

LCA, LCI, LCIA, LCC

Life cycle assessment tools serve as essential components for making environmentally conscious and economically sound decisions. While LCA provides a comprehensive framework for environmental impact analysis, LCI focuses on detailed data collection, LCIA transforms this data into meaningful environmental metrics, and LCC adds the crucial financial perspective.

These tools work together to create a complete picture of a product’s impact throughout its lifetime. Above all, standardization through frameworks like ISO 14040 and EN 15804+A2 ensures consistent results across different industries and applications.

Understanding these concepts can be challenging at first. That’s why we created the Life Cycle Assessment from A to Z guide — the ultimate glossary powered by P6 Technologies to simplify LCA terminology and methodologies. Get instant access to your copy now and equip yourself to better navigate these environmental assessment tools.