Environmental Life Cycle

Assessment
CEE 12-714 / EPP 19-714
Lectures 12 through 15: Introduction to Input-Output
Based LCA - Part 1

February 26, 2018

 Administrivia
3

• Tomorrow, during office hours, optional lecture

on stochastic modeling for LCA
 Method not required for HW
 Valuable tool for managing uncertainty
 Use it for your project if you have team skills in Monte
Carlo modeling and interpretation

3
 Administrivia
4

• HW4 available (you can do Q1-Q3 now)

 Due Thursday, March 8th
 Significant work load – start ASAP
 Hint: HW4.Q3: In system expansion, the determining
product controls the multifunctional system’s output.
Use system expansion via “subtraction” to solve
HW4.Q3d and e, by removing the non-determining
products.

4
 Meant to do this
Administrivia on Day 1…
5

• On my honor…
• New (old) requirement for HW submissions.
Include the following statement and your digital
signature on each submission (HW4.Q1,
HW4.Q2, etc.):
 “I affirm that I have not used any prohibited materials
to solve this problem, including but not limited to prior
year solutions or notes, web-based solutions posted by
other professors or students, and materials shared
with me by students from prior years. I affirm that this
is my own work.”

5
 Administrivia
6

• Group Project
 Upload your proposals to Canvas by midnight tonight
 Teams have been created in Canvas – only one
person needs to upload your file
 Budget for project purchases (more on Wednesday)

• Keep reading Chapter 8, as directed in Canvas

• Regular office hours Wednesday and Thursday

6
Course trajectory
1. Introductions 10. Uncertainty
2. Life cycle thinking 11. Input-output LCA
3. Quantitative methods and 12. Process-matrix LCA
life cycle cost analysis
13. Hybrid LCA
4. ISO LCA framework
14. Impact assessment
5. Critical review
15. Structural path analysis
6. LCA data sources
16. Professional responsibility
7. Life cycle inventory
17. Carbon footprinting
8. SimaPro
18. LCA for big decisions
9. Handling multifunction
19. Project presentations
systems

7
Input-Output LCA
Models: Part 1
(Introduction)
(…catching the supply chain
across the economy)
10
 Recap
11

• Defining goals, scopes

and functional units
• Using LCI databases
to begin building
inventories based on
process-based
understanding of life
cycle stages
• Explored process
connectivity (and the
use of allocation)

11
 Now…
12

• More in-depth system thinking

 What about the supply chain?
 Who supplies the suppliers?
 Remember the beverage container diagrams you drew
 What about circularity in the supply chain?
 Making electricity requires coal from coal mining (which
requires electricity)
• How can we keep track of all these layers in our
inventories?
• How many of these branches of the supply chain
do we need to trace out?
12
 A new tool…Input Output modeling
13

• “Input Output” (IO) tables represent direct inputs

required to produce a unit of output
• IO models account for all inputs across the
supply chain (direct and indirect) to produce that
unit of output

13
 Input Output series of lectures
14

• Four lectures to explore the use of IO models to

assess direct and indirect environmental impacts
 Lecture 12: Group exercise
 Lecture 13: Building and using an IO model
 Lecture 14: Where do IO model data come from?
 Lecture 15: IO Tool demo and examples

14
 Structure of a Process-based LCA
Model
15
sub-system2

process process process

process
process
process process process

process
process
process process

process

process
process process

process process process

process
process
sub-system1

This is a bottom-up view of a product system. If we want to

consider the effects of a process, we have to add it manually. 15
 Issues in Process-Based LCA:
The Boundary Issue
16

• Where to set the system boundary?

• “Conventional” LCA:
 Include all processes if possible
 But at least the most important processes if there are time
and financial constraints (bottom-up model)
• IO models are very comprehensive – top-down
view
 Boundary = entire economy, recognizing relationships
among industrial sectors (i.e., whole supply chain)
 Products described by a sector represent an average
product (not a specific one)
16
 Input-Output LCA Intro
17

• Will motivate the new type of LCA (IO-LCA)

through an exercise: split into groups of 4
• Fictitious 4 industries that are interdependent
 Soda manufacturer
 Can manufacturer
 Water works
 Aluminum maker

• This will simulate the workings of an IO model

17
 Our Simple Economy
18

18
Process Specific Details for Each
Industry

19
 Unit Process for Soda Producer
20

1 gallon (128 ounces) water 10 empty cans

Soda Producer

10 cans of soda
20
 Unit Process for Can Manufacturer
21

5 gallons water 1 pound aluminum

Interpretation:
need 5 gals water
for every 1,000
empty cans and 1 Can Manufacturer
pound Al for every
32 empty cans
(find two ratios)

1,000 empty cans 32 empty cans

21
22
Unit Process for Aluminum

1.58 gallons water 1 empty can*

*scrap material equal

to the material for
Aluminum Manufacturer one can

1 pound aluminum 2 pounds aluminum

22
 Unit Process for Treated Water
23

5 pounds of aluminum 5 cans of soda

Water Treatment Plant

1,000 gallons water 10,000 gallons water

23
Soda Producer
For 10 cans of soda: 1 gallon water AND
For 1 can of soda: 1 empty can

Can Manufacturer
For 32 empty cans: 1 pound aluminum AND
For 1,000 empty cans: 5 gallons water
Aluminum Manufacturer

For 1 pound aluminum: 1.58 gallons water AND

For 2 pounds aluminum: 1 empty can

Water Treatment Plant

For 1,000 gallons of water: 5 pounds aluminum AND

For 10,000 gallons of water: 5 cans of soda 24
 First Task (a few minutes)
25

• Add the production functions (or flows) to the

overall process flow diagram (W1)
 Flows should have physical ratios with units (e.g., X of
these for every Y of those)
 Denominator are the units for the purchasing industry

25
 Our Simple Economy with example
production flow
26

26
 Our Simple Economy with all
production flows
27

27
 Second Task (a few minutes)
28

• How much water is needed to make 100 cans of

soda (direct purchase)?
• How many cans of soda are needed to make
25,000 gallons of water?

28
 Then…
29

• Goal: to see how much of every industry’s product it

takes to make 1,000,000 cans of soda
• Place and receive “purchase orders”
 The first (1M cans of soda) comes from me.
 That order will result in new orders for other inputs

29
 Log Sheet Provided (W3)
30

30
W4. Purchase Order Organizer
Can manuf.

Soda producer Soda producer

Can manuf. Can manuf.
100 empty cans 100 empty cans

31
 Stop when…
32

• Cut-off rule: when input needed is <1

 Do not place an order if the amount you would order is
less than 1 unit of what they produce
 Where units = cans, pounds, gallons
 Track YOUR production, not others (based on orders)

32
 Tally your four total productions
(W5)
33

33
 Now calculate emissions…
34

• Use these estimates of waste outputs

associated with your production to estimate total
wastes (the rest of W5)

Wastewater Solid Waste

per unit per unit
Soda 8 ounces per 10 1 pound for every
cans soda 100 cans
Can 5 gallons per
1000 empty can
Aluminum 1.58 gals per 2.7 pounds per
pound Aluminum pound Aluminum
Water 1 pound per 1000
gallons

34
 Wastewater and solid waste
35

35
 Results
36

Production Waste- Solid

water Waste
Soda 1,000,078 cans 6,250 10,001
Can 1,016,039 5,082 0
empty cans
Aluminum 32,525 pounds 51,389 87,816
Water 156,475 0 156
gallons
Total 62,721 97,974

36
 Our Simple Economy – next level?
37

37
 Lessons Learned
38

• Even a simple economy is quite complex

• Not just direct impacts
• Circularity
 Took soda to make water and water to make soda
 Thus, takes soda to make soda!
 ‘Solved’ via long chain of purchase orders
 Somehow dealt with circularity!
• Boundary issue (cut off at <1 or before)
 Truncates analysis – question is whether it matters?

38
 Summary
39

• This was our first Input Output (LCA) model

 Simulates an actual economy, with interconnected
industries producing output
 Estimates results per unit of output (per soda, etc.)
• This was a physical unit IO model, next lecture
we will generalize back to the original economic
input output models (currency based)

39
Questions on the Industry
Exchange Simulation?

40
 Next
41
• HW4 available
 Start Q1, Q2 and Q3 now
 Due March 8th
• Group Project – proposals due by midnight
Monday via Canvas

• Keep reading Chapter 8, as directed in Canvas

• Optional lecture on Stochastic Modeling in LCA
Tuesday during office hours
• Regular Office Hours Wednesday and Thursday

41
Environmental Life Cycle
Assessment
CEE 12-714 / EPP 19-714
Lectures 12 through 15: Introduction to Input-Output
Based LCA - Part 2, Matrix Magic

February 28, 2018

 Administrivia
43

• HW4 due Thursday, March 8th

• Group Project – comments on initial proposal to
you shortly

• Keep reading Chapter 8, as directed in Canvas

• Regular Office Hours this week

43
Course trajectory
1. Introductions 10. Uncertainty
2. Life cycle thinking 11. Input-output LCA
3. Quantitative methods and 12. Process-matrix LCA
life cycle cost analysis
13. Hybrid LCA
4. ISO LCA framework
14. Impact assessment
5. Critical review
15. Structural path analysis
6. LCA data sources
16. Professional responsibility
7. Life cycle inventory
17. Carbon footprinting
8. SimaPro
18. LCA for big decisions
9. Handling multifunction
19. Project presentations
systems

44
 Our Simple Economy from last class
45

45
 In response to demand for 1 million
sodas…
46

Production Wastewater Solid

Waste
Soda 1,000,078 6,250 10,001
cans
Can 1,016,039 5,082 0
empty cans
Aluminum 32,525 51,389 87,816
pounds
Water 156,475 0 156
gallons
Total 62,721 97,974 46
Tracing supply chain with math
• The 4-sector model can be expressed as a
system of linear equations
• Using linear algebra, simple matrix
manipulations can give supply chain impacts for
inputs, as well as outputs or emissions across
supply chain
• To be demonstrated several ways…

47
First, a few Matrix refreshers
𝑥1
• Vector – one dimensional array 𝑥= 𝑥
2

• Matrix – two dimensional array 𝑎11

𝐴= 𝑎
𝑎12
21 𝑎22

• Identity matrix – equivalent to “1” 1 0

𝐼=
0 1

• Basic matrix multiplication

𝑎11 𝑎12 𝑥1 𝑎11 𝑥1 +𝑎12 𝑥2
𝑌 = 𝐴𝑥 = 𝑎 𝑎 𝑥 = 𝑎 𝑥 +𝑎 𝑥
21 22 2 21 1 22 2

48
Matrix refreshers
• Using the identity matrix
𝑎11 𝑎12 1 0
𝐴 = 𝐴𝐼 = 𝑎21 𝑎22 0 1 =
𝑎11 ∙ 1+𝑎12 ∙ 0 𝑎11 ∙ 0+𝑎12 ∙ 1
=
𝑎21 ∙ 1+𝑎22 ∙ 0 𝑎21 ∙ 0+𝑎22 ∙ 1
𝑎11 𝑎12
𝑎21 𝑎22 = 𝐴

49
Matrix refreshers
• Matrix size is described by (# of rows by # of
columns)
𝑎11 𝑎12
𝐴= 𝑎 2x2 matrix
21 𝑎22

𝑥1
𝑥= 𝑥 2x1 matrix
2

• Matrix multiplication only works when “inside”

sizes are equal:
𝑌 = 𝐴𝑥 =
𝑎11 𝑎12 𝑥1 𝑎11 𝑥1 +𝑎12 𝑥2
𝑎21 𝑎22 𝑥2 = 𝑎21 𝑥1 +𝑎22 𝑥2
(2x2) (2x1)
50
Solve (by hand):
3
𝑇= 1 2 =?
4

1 2 3
𝑈= =?
5 6 4

1 2 3 7
𝑉= =?
5 6 4 8

51
Solve (by hand):
3
𝑇= 1 2 = 1 ∙ 3 + 2 ∙ 4 = 11
4

1 2 3 1∙3+2∙4 11
𝑈= = =
5 6 4 5∙3+6∙4 39

1 2 3 7 1∙3+2∙4 1∙7+2∙8
𝑉= =
5 6 4 8 5∙3+6∙4 5∙7+6∙8
11 23
=
39 83

52
Master these steps in Excel
• Multiplication (MMULT)
• Inverse (MINVERSE)
• Type functions into the formula bar
 or use the Excel "Insert->Function“ dialog box helper
• First select the cell range of the expected result
(with the appropriate m x n dimensions), then
enter the formula, and click CTRL-SHIFT-
ENTER
• You will see an error (or a result in only one cell)
if you skip one of the steps.
53
Tracing supply chain with math
• In the 4-sector soda can exercise:
 Demand = 1 million sodas. 4-industry economy gave
back 1 million sodas, plus another 78 required for the
supply chain
 First round of direct purchases needed 100,000
gallons of water. Ultimately, economy generated
156,000 gallons of output after accounting for the
supply chain’s additional requirements
• Generally, final output from a system includes
the amount demanded directly plus additional
amounts required throughout the supply chain.

54
First, building the supply chain
• Transactions table: describes all purchases in
terms of sector outputs that are used as inputs
within an economy
 Basis can be physical (e.g., cans of soda, gal of water)
 Or in economic terms (value)
• 4-sector economy: use the 8 physical production
functions to make a transactions table,
normalized by each sector’s functional unit
 This will be our “direct requirements table” or “A”
matrix
 (later, we’ll create a “total requirements” matrix)
55
 Production recipes
(one column at a time)

Soda:
 10 empty cans (C) = 10 sodas (S)
 1 gal water (W) = 10 sodas (S)
 Normalize to product (1 soda):
 1C = 1S
Recipe
 0.1W = 1S
 And zero Aluminum (A) Soda
Sodas S 0
Empty cans C 1
Aluminum (lb) A 0
Water (gal) W 0.1
56
 Production recipes
Empty can:
 5 gal W = 1,000 C
 1 lb Aluminum (A) = 32 C
 Normalize to product:
 0.005W = 1C Recipe
 0.03125A = 1C
Soda Can
 And zero Soda

Sodas S 0 0
Empty cans C 1 0
Aluminum (lb) A 0 0.03125
Water (gal) W 0.1 0.005
57
 Production recipes
Aluminum:
 1C = 2 lb A
 1.58 gal W = 1 lb A
 Normalize to product:
 0. 5C = 1A
 And zero Soda
Recipe
Soda Can Aluminum
Sodas S 0 0 0
Empty cans C 1 0 0.5
Aluminum (lb) A 0 0.03125 0
Water (gal) W 0.1 0.005 1.58
58
 Production recipes
Water: We’ve just built a
 5A = 1,000 gal W “direct requirements”
 5 sodas (S) = 10,000 gal W table (aka “A” matrix)
 Normalize to product:
 0.005A = 1W
 0.0005S = 1W
 And zero cans
Recipe
Soda Can Aluminum Water
Sodas S 0 0 0 0.0005
Empty cans C 1 0 0.5 0
Aluminum (lb) A 0 0.03125 0 0.005
Water (gal) W 0.1 0.005 1.58 0 59
Last time we manually calculated
‘purchase orders’…

60
…It gets complicated to calculate the
entire stream of upstream input
61
requirements

Source: Huang 2010

61
 Knowing the “A” matrix, is there a
short cut?

“direct requirements” table (aka “A” matrix) for the

soda production 4 sector economy

Recipe
Soda Can Aluminum Water
Sodas S 0 0 0 0.0005
Empty cans C 1 0 0.5 0
Aluminum (lb) A 0 0.03125 0 0.005
Water (gal) W 0.1 0.005 1.58 0

62
 What purchase orders would you need
63 to place from Tier 1?

Soda Can Aluminum Water

Producer Manufacturer Manufacturer Treatment

? ? ? ?

Tier 0 = “Final Demand” Soda Producer

1 million cans of soda
63
Knowing the “final demand”, we can
calculate Tier 1 requirements

• I asked for 1 million sodas which represents the

“final demand”, Y.
 Ultimately, the economy has to give me 1 million
sodas
 …and the supply chain will need some, too

Sodas S 1,000,000
Empty cans C 0
Y= Aluminum (lb) A 0
Water (gal) W 0

64
 Final Demand recipe
• We can calculate the ‘Tier 1’ demand by
multiplying the A and Y matrices
 X1= A x Y

Soda Can Al Water Y X1=AY

S 0 0 0 0.0005 1,000,000 S 0

C 1 0 0.5 0 x 0 = C 1,000,000

A 0 0.03125 0 0.005 0 A 0

W 0.1 0.005 1.58 0 0 W 100,000

Is this what your 4-

sector group got?
65
 What purchase orders would you need
66
to place from Tier 2?

Soda Can Aluminum Waste Soda Can Aluminum Waste Soda Can Aluminum Waste Soda Can Aluminum Waste
Producer Manufacturer Manufacturer Treatment Producer Manufacturer Manufacturer Treatment Producer Manufacturer Manufacturer Producer
Treatment Manufacturer Manufacturer Treatment

? ? ? ? ? ? ? ? ? ? ? ? ?
? ? ?

Soda Can Aluminum Water

Producer Manufacturer Manufacturer Treatment
1 million cans 100,000 gallons

Tier 0 = “Final Demand” Soda Producer

1 million cans of soda
66
 Final Demand recipe
• We can calculate the ‘Tier 2’ demand by
multiplying this by A again:
 X2= A x AY = A x A x Y

Soda Can Al Water AY X2 AAY

S 0 0 0 0.0005 S 0 S 50

C 1 0 0.5 0 x C 1,000,000 = C 0

A 0 0.03125 0 0.005 A 0 A 31,250

W 0.1 0.005 1.58 0 W 100,000 W 5,000

Is this what your 4-

sector group got? 67
 Supply Chain Buildup
68

• Find total output (X) at each “level” of production:

 Zeroth level (initial demand): X = I*Y = Y
 First Level: X = A*Y
 Second Level: X = A*A*Y = A2Y
 Third Level: X = A*A*A*Y = A3Y
 And so forth…

• In IO terminology, “Direct” = Zeroth + First levels

= I*Y+A*Y = (I+A)*Y
 All other levels are “Indirect”

68
 Supply Chain Buildup
69

• Direct output = (I+A)*Y …

• What is the total output across ALL levels of

production?
X = I*Y + A*Y + A2Y + A3Y +…
= (I + A + A2 + A3 + …)Y
 This infinite series represents an infinite geometric
series, and can be solved in matrix term as:
X = [I-A]-1Y
• [I-A]-1 is called the total requirements matrix (or table)

69
 Total Output: X= [I-A]-1 Y
-1
Soda Can Al Water Y
1,000,000
S 1-0 0-0 0-0 0-0.0005
x 0 =
C 0-1 1-0 0-0.5 0-0
0
A 0-0 0-0.03125 1-0 0-0.005
0
W 0-0.1 0-0.005 0-1.58 1-0

[I-A]-1 Y X=[I-A]-1Y

1,000,000 S 1,000,078
1.000 0.000 0.001 0.001
1.016 1.016 0.513 0.003
x 0 = C 1,016,350
0 A 32,543
0.033 0.032 1.024 0.005
0 W 156,508
0.157 0.056 1.621 1.008
70
 Full Solution
71

• See Excel sheet posted to Canvas

 Industry exchange exercise (Lectures 12-13).xlsx
• See Chapter 8, Advanced Materials - Section 6
for tips on how to use Excel for matrix math
 MMULT – multiplies matrices
 MINVERSE – creates matrix inverse
 Before using these commands, select all of the cells
where your output will go, then type the command
 Instead of using ENTER after typing your command
string, use CTRL-SHIFT-ENTER to generate a matrix
result

71
Economic Input Output
• Economic IO models the economy through
monetary transactions.
 Same build out as what we just did with the 4-sector
physical soda model, with a little more

72
 Economic Input-Output Analysis:
Some History
73

• Method called IOA, Economic IOA

• Developed by Wassily Leontief (Nobel Prize in 1973)
in 1930’s to 1970’s
• “General interdependency” model: quantifies the
interrelationships among sectors of an economic
system
 Comprehensive model of US economy using series of linear
equations for 500 sectors
 Represented various inputs required to produce a unit of
output in each economic sector based on surveyed census
data of purchases and sales of industries.
 Used an early computer at Harvard to solve resultant system
73
 Economic Input-Output Analysis:
Some History
74

• Governments started creating to track economic

dependencies
• Used during WW2 to project impacts on economy
due to spike in military production
• Used today to calculate GDP among other
applications

• Can be extended to environmental and energy

analysis — a.k.a., Environmental IOA , EEIO, EIO-
LCA

74
Economic IO Process
• Transactions table (sector to sector)
• Direct Requirements table or A matrix
(transactions normalized by sector outputs)
• Total Requirements matrix, [I-A]-1 (Leontief
inverse matrix)

75
 Economic Input-Output Model:
Transactions Table
76

Input to sectors Intermediate Final Total

1 2 3 n Output Demand Output X

Output 1 Z11 Z12 Z13 Z1n O1 Y1 X1

from 2 Z21 Z22 Z23 Z2n O2 Y2 X2
sectors
n Zn1 Zn2 Zn3 Znn On Yn Xn

Production “recipe” for making

output from Sector 1

O1 = Z11+Z12+Z13+…+Z1n = Intermediate output from Sector 1

Y1 = Final demand of consumers
X1 = O1 + Y1 = Z11+Z12+Z13+…+Z1n + Y1
= Total output from Sector 1 76
 Economic Input-Output Model:
Transactions Table
77

Input to sectors Intermediate Final Total

Output Demand Output X
1 2 3 n
Output 1 Z11 Z12 Z13 Z1n O1 Y1 X1
from 2 Z21 Z22 Z23 Z2n O2 Y2 X2
sectors
n Zn1 Zn2 Zn3 Znn On Yn Xn

Intermed. Input I1 I2 I3 In
Value Added V1 V2 V3 Vn Same!
Total Output X1 X2 X3 Xn

I1 = ∑Z11+Z21+Z31+…+Zn1 = Intermediate input to Sector 1

V1 = Value added by Sector 1 (e.g., direct labor, profits, taxes)
X1 = I1 + V1 = Total output from Sector 1
77
 Economic Input-Output Model:
78
Transactions Table (from textbook)

• Gross Domestic Product (GDP)

 Sum of Value Added (non-interindustry purchases)
 Sum of Final Demand is GDP
 Double-accounting framework
• “Final demand” are spending by households, government,
trade, capital investments (not inter-sector)
78
 Using Transactions Table to create
the Direct Requirements Table

• For calculation purposes, normalize transactions

table to represent proportional input from each
sector for a single dollar of output
• Each Zij entry is divided by the total (column)
output of that sector, Xj
 Gives matrix A, or direct requirements table or matrix
 In an economic IO model, all resultant entries are
between zero and one
 Shows requirements of other sectors directly required to
produce a dollar of output for each sector

79
Direct Requirements Table
• “Direct" purchases at highest level of decision
making
 Direct purchases to make cars = windshields, tires,
engines

80
 Direct Requirements Table
(“A” Matrix)
81

Intermed Final Total

Input to sectors Output Demand Output X
1 2 3 n
Output 1 Z11/X1 Z12/X2 Z13/X3 Z1n/Xn O1 Y1 X1
from 2 Z21/X1 Z22/X2 Z23/X3 Z2n/Xn O2 Y2 X2
sectors
n Zn1/X1 Zn2/X2 Zn3/X3 Znn/Xn On Yn Xn

Intermed. Input I1 I2 I3 In
Value Added V1 V2 V3 Vn To make “A” matrix,
Total Output X1 X2 X3 Xn normalize each
column by Xj, where
X1 = O1 + Y1 Aij = Zij/Xj
= Z11+Z12+Z13+…+Z1n + Y1 (from the Transactions table)
=A11X1+A12X2+A13X3+…+A1nXn+Y1 = ∑(A1j*Xj) + Y1
81
 Expressing the Requirements Table in
matrix notation
84

∑(Aij*Xj) + Yi = Xi
Recognizing that the A matrix is a series of linear
equations, it can be expressed in vector/matrix
notation as:
A*X + Y = X

Solving for Total Demand (Y): I is the n×n identity

Y = [I - A] * X matrix.

or for Total Output (X): [I - A]-1 is the Leontief

X = [I - A]-1 * Y inverse matrix
84
 Fancier Analysis – Linear
Simultaneous Equations
85

• Production for each sector:

Xi = Ai1 X1 + Ai2 X2 + … + Ain Xn + Yi
• Set of n linear equations in unknown Xn:
X = AX + Y

• Matrix Expression for Solution:

X(I - A) = Y ↔ X = (I - A)-1 Y

See also Chap 8, Advanced Material, Section 1

85
 A third way to think about the matrix
math (that we’ve already seen):
86

• Find total output (X) at each “level” of production:

 Zeroth level: X0 = I*Y = Y
 First Level: X1 = A*Y
 Second Level: X2 = A*A*Y = A2Y
 Third Level: X3 = A*A*A*Y = A3Y
• X = (I + A + AA + AAA + … )Y
• X = (I + A + A2 + A3 + …) Y

• Look familiar? This power series is solved in matrix

terms as:
 X = (I-A)-1 Y (same equation as from linear system)

86
 Recall: Generic Unit Process
87

Emission(s)

Input(s) Product(s)

Waste(s)

87
 IO Unit Process for Cars
88

Coming soon..
$2,500 Engine
Emission(s)
$2,000 Other parts

$1,200 Steel body Input(s) Product(s)

$20,000
$800 Plastics
car

…
$10 Car Waste(s)
Coming soon..
88
Example: Scaling Requirements to
Actual Product
$20,000 Car

$2,500 Engine $2,500 Engine

$2,000 Other parts $300 Steel

$1,200 Steel body $200 Steel

processing

$800 Plastics $150 Aluminum

… …
$10 Car $10 Lawyers

And hierarchically for all other upstream production

89
Scaling Example: Divide by Output
Value

Car (after dividing

by $20,000
0.125 Engine Engine (after
dividing by $2,500)
0.12 Steel
0.1 Other parts

0.08 Steel
0.06 Steel body
processing
0.06 Aluminum
0.04 Plastics

…
… Lawyers
0.004
0.0005 car
90
 Using an IO Model
91

• Columns are a ‘production function’(or

recipe) for making $1 of good or service
• Strictly linear production relationship –
purchases scale proportionally for desired
output — basic assumption of IO

• Similar to Mass Balance Process Model

 Inputs from technosphere
 Outputs to technosphere

91
92
Brief In Class Exercise – Part 1
Transaction flows ($billion)
• Two Sector Economy
1 2 Final
Dmd.
• Model 0th and 1st tier
output (X) for Final 1 150 500 350
Demand (Y) of $100
for Sector 1 2 200 100 1700

• Model total output V.A. 650 1,400 1,100

92
80
Brief In Class Exercise – Part 1
1 2 Final Total
1. Add X, Total
Dmd. Output,
Output, to the
X
Transactions
table 1 150 500 350
2 200 100 1700
V.A. 650 1400 1100
X

93
80
Brief In Class Exercise – Part 1
1 2 Final Total
1. Add X, Total Dmd. Output,
Output, to the X
Transactions
1 150 500 350 1000
table
2 200 100 1700 2000
V.A. 650 1400 1100
X 1000 2000

94
 Brief In Class Exercise – Part 1
1 2 Final Total
2. Create A
Dmd. Output,
matrix:
X
1 150 500 350 1000
2 200 100 1700 2000
V.A. 650 1400 1100
X 1000 2000

95
 Brief In Class Exercise – Part 1
1 2 Final Total
2. Create A
matrix: Dmd. Output,
X
150 500
1000 2000
1 150 500 350 1000
A= 200 100
2 200 100 1700 2000
1000 2000
V.A. 650 1400 1100
0.15 0.25 X 1000 2000
=
0.2 0.05

96
Brief In Class Exercise – Part 1
3. Create Final Demand matrix for $100 in Sector 1
?
𝑌=
?
4. Create Identity matrix
? ?
I=
? ?
5. Calculate Zeroth tier output
I*Y =

97
Brief In Class Exercise – Part 1
3. Create Final Demand matrix for $100 in Sector 1
100
𝑌=
0
4. Create Identity matrix
1 0
I=
0 1
5. Calculate Zeroth tier output
1 0 100 100
I*Y = =
0 1 0 0

98
Brief In Class Exercise – Part 1

6. Calculate Tier 1 output

A*Y =

7. Calculate Direct outputs =

Zeroth tier + Tier 1 = I*Y+A*Y =

99
Brief In Class Exercise – Part 1

6. Calculate Tier 1 output

0.15 0.25 100 15
A*Y = =
0.2 0.05 0 20

7. Calculate Direct outputs = Zeroth tier + Tier 1

= I*Y+A*Y
100 15 115
= + =
0 20 20

100
 To find the Inverse of a 2x2 Matrix:
swap the positions of a and d, put
Brief In Class Exercise – Part 1
negatives in front of b and c, and divide
everything by the determinant (ad-bc).
Or do it in Excel with MINVERSE(…)
8. Calculate Total Requirements matrix
−1
-1 1 − 0.15 0 − 0.25 1.25 0.33
[I-A] = =
0 − 0.2 1 − 0.05 0.26 1.12

9. Calculate Total outputs = X = [I-A]-1Y

1.25 0.33 100 125.4
= =
0.26 1.12 0 26.4

101
Brief In Class Exercise – Part 1

10. Compare results:

100
 Final demand =
0
115
 Direct outputs (Zeroth and Tier 1)=
20
125.4
 Total outputs =
26.4

 Indirect outputs = ?

102
Brief In Class Exercise – Part 1

10. Compare results:

100
 Final demand =
0
115
 Direct outputs (Zeroth and Tier 1)=
20
125.4
 Total outputs =
26.4

125.4 115 10.4

 Indirect outputs = - =
26.4 20 6.4

103
 Life Cycle Stages: tracking energy
and environmental flows
104

• At each stage, there are some inputs used and

some outputs created that need to be identified
• Linear model – flow factors in “units/$”
• Example: automobile production
 Direct: emissions from assembly factory and first tier
of suppliers who deliver to assembly line (engines,
windshields, tires, …)
 Indirect: emissions from suppliers of suppliers’
factories, electricity purchased by supplier factories,
etc.

104
105
Effects Specified
• Direct
 Inputs needed for final (zeroth) production of
product and first tier (energy, water, etc.)

• Indirect – second through Nth tiers

 e.g., Metal, belts, wiring for engine
 e.g., Copper, plastic to produce wires
 Calculation yields every $ input needed

105
Environmental Life Cycle
Assessment
CEE 12-714 / EPP 19-714
Lectures 12 through 15: Introduction to Input-Output
Based LCA – Part 3 – EIO-LCA

March 5, 2018
 Administrivia
107
Average scores
• HW3 returned
HW1: 81.7%
 Q1: 4.8/5 HW2: 88.7%
 Q2: 7.2/8 HW3: 91.3%
 Q3: 12.1/13
 Q4: 14.3/16
 Formatting: 9.1/10
 Overall: 47.5/52
 Carefully review grader feedback
 Well done!

• No class next week – Spring Break!

107
Group Project
• Next deliverable: Revised and expanded goal
and scope document (due 3/21/2018), 10 project
points
 Markedly more than first submission
 10-20 pp
• Describe your modeling approach to each life
cycle stage of your product/process
 Identify unit processes
 Scenarios and assumptions (justified)
 Uncertainty ranges or distributions
• Demonstrate responsiveness to my comments

108
Group Project
• You must have at least one meeting with me
before submission (full team)
• My current availability:
Mon, 7th Tues, 8th Wed, 9th Thur, 10th Fri, 11th
10:30-12 All day in 1:00-4:00 8:00-10:00 Not
and Cohon 10:00: Tm 1 available
1:30-5:00 Center, 11:00-2:00
Connan
Room
Mon, 19th Tues, 20th Wed, 21st
10:30-12 Too late for Revised
and useful goal and
1:30-4:20 meeting scope due
4:20: Tm 6
109
Group Project
• Purchasing plan
 Applies to Team 2 (Kuerig), Team 4 (Blue Apron),
Team 5 (Drone Pizza)
 Budget and timeline (order needs to be placed no later
than…) emailed to me by Wednesday (March 7)
 Specific URLs for ordering
 Deliver to whom? … name and address
 We MUST go through the CEE office to make
purchases

110
Administrivia
• Downside to being late to class – missing hints,
pop quiz bonus points, and additional
HW/project directions

111
RECAP: Input-Output Process
• Transactions table (sector to sector)
 Physical units (cans of soda)
 Monetary transactions (dollars)
• Direct Requirements table
 A matrix
 Transactions normalized by sector outputs (per can,
per $)
• Total Requirements matrix
 Captures supply chain interactions
 [I-A]-1
 Leontief inverse matrix

112
 Recap:
Total Output: X= [I-A]-1 Y
-1
Soda Can Al Water Y
1,000,000
S 1-0 0-0 0-0 0-0.0005
x 0 =
C 0-1 1-0 0-0.5 0-0
0
A 0-0 0-0.03125 1-0 0-0.005
0
W 0-0.1 0-0.005 0-1.58 1-0

[I-A]-1 Y X=[I-A]-1Y

1,000,000 S 1,000,078
1.000 0.000 0.001 0.001
1.016 1.016 0.513 0.003
x 0 = C 1,016,350
0 A 32,543
0.033 0.032 1.024 0.005
0 W 156,508
0.157 0.056 1.621 1.008
113
 Recall…
This extension allowed
us to calculate waste
outputs. How to handle in
matrix approach?

114
Given X, Total Output, how to
calculate environmental impacts?
• Create extension for sector-specific impacts
• New equation - Environmental impact
calculation:
E = RX = R[I - A]-1 Y
• R matrix has units of burdens per functional unit
(e.g., pounds of solid waste/soda, kg CO2/$)
 Use as a vector to calculate total burdens
 Use as a diagonalized array to show burdens by sector

115
Impacts from soda…
cans of empty pounds gallons
R Matrix soda cans Al of water
wastewater 0.00625 0.005 1.58 0
solid waste 0.01 0 2.7 0.001

Ewastewater = RX
1,000,078
1,016,339
= [.00625 .005 1.58 0] = 62,721 𝑔𝑎𝑙 𝑜𝑓 𝑤𝑤
32,525
156,475
OR
.00625 0 0 0 1,000,078 6,250
0 .005 0 0 1,016,339 5,082
= = 62,721
0 0 1.58 0 32,525 51,389
0 0 0 0 156,475 0 gal, total
116
 Recap:
117
Brief In Class Exercise – Part 2
Transaction flows ($billion)
• Two Sector Economy
1 2 Final
Dmd.
• What are direct 1 150 500 350
emissions if Haz
Waste of 50 gm/$ in
Sector 1 and 5 gm/$ in 2 200 100 1700
Sector 2?
V.A. 650 1,400 1,100

117
Recap:
Brief In Class Exercise – Part 1

8. Calculate Total Requirements matrix

−1
-1 1 − 0.15 0 − 0.25 1.25 0.33
[I-A] = =
0 − 0.2 1 − 0.05 0.26 1.12

9. Calculate Total outputs = X = [I-A]-1Y

1.25 0.33 100 125.4
= =
0.26 1.12 0 26.4

118
 Brief In Class Exercise – Part 2
11. Create R matrix
? ?
R = ? ? OR
? ?
12. Calculate Direct Emissions
= R * Direct output = R * (I+A)Y

119
 Brief In Class Exercise – Part 2
11. Create R matrix
50 0
R = 50 5 OR
0 5
12. Calculate Direct Emissions
= R * Direct output = R * (I+A)Y
115
= 50 5 =5850
20
50 0 115 5750
𝑂𝑅 = =
0 5 20 100

120
 Recall: Soda Economy Exercise
121

• Posted spreadsheet (Industry exchange

exercise S17.xlsx)
 Physical units worksheet (to get total production
answer) – trivial
 Waste worksheet – trivial
 Dollars – not done in exercise, an “fyi” or validation
exercise

• Matrix approach is much easier – everyone

could have gotten the right answer this way!

121
 Revisit - Issues in PLCA: Circularity
122

• Circularity effects in the economy must be

accounted for: cars are made from steel, steel is
made with iron ore, coal, steel machinery, etc. Iron
ore and coal are mined using steel machinery,
energy, etc...
R
E waste
S
O
U
product
R
C
E
S emissions

system
boundary

IO models have circularity embedded within, Leontief equation solves.

122
 Where do IO–LCA Data Come From?
123

Combination of economic, environmental data.

Economics first!
123
Overview of US Input-Output
Accounts
• Bureau of Economic Analysis (BEA)
 US Department of Commerce
 Mission: to promote a better understanding of the U.S.
economy by providing timely, relevant, and accurate
economic accounts
• Core of the I-O accounts
 Two basic national-accounting tables—a “make” table
and a “use” table
 Direct and Total Requirements tables calculated from
the make and use tables

124
 Data used by BEA in US IO Accounts
• U.S. Bureau of the Census, Economic Census
 Conducted every 5 years
 Primary data source for BEA benchmark I-O tables
 Receipts, inventories, and payrolls
 Collected at the “establishment” level
 Sample (not a complete canvas) (14 million surveyed!)
• Other Census Bureau annual surveys of selected
industries, such as manufacturing and services
• U.S. Departments of Agriculture, Education, and
Energy
• Private organizations

125
BEA Industry Data Input-Output

126
 Make and Use system
See Chapter 8, Advanced Material Section 2
127
• Goal: Form Input-Output Transactions Table–
Flow of purchases between sectors.

• The make and use system was developed to

account for “secondary production”

• The Make (Supply) Table describes what

products each industry makes (supplies)
• The Use Table describes what products each
industry uses

127
 Make Table
128

• Describes what products each industry makes

(supplies)
• Diagonal terms are usually primary products
• Off-diagonal terms are usually co-products
 what they make that’s actually in another sector
 e.g., lots of sectors make a little energy as co-product

128
129
 Redefinition process moves
co-products to more logical sectors

13
130
 Use Table
131

• Describes what products each industry uses

• Describes what products and value added each
industry requires
• Describes what products each final demand
category purchases

131
132
Use tables
• Before and after redefinitions (same distinction
as with Make tables)
• Producer Prices versus Purchaser Prices (more
later)

133
 Direct Requirements table
(“A” Matrix)

… (first 4 rows from Direct Requirements table)

As demonstrated in last class, the Direct Requirements table

normalizes the inputs from each sector by the total output of
the sector they are “feeding”. All A matrix coefficients in an
economic IO are less than 1, and sum to 1 in each column.
134
 US IO Economic Data
135

• Interactive BEA IO Data Site:

 http://www.bea.gov/iTable/index_industry_io.cfm
• Three levels of detail
 Sector (~12), Summary (~90), Detailed (400-500)
 See “Historical Benchmark IO” for 1987, 1992, 1997,
2002 data
• Annual and benchmark tables
 US benchmarks only every 5 years (latest 2007 –
released in late 2013)
 2007 available but not discussed in course

135
 Stability in Sector table
136

• Look at changes in BEA IO sector table over

time…
• Coefficients for Agriculture-Agriculture cell
 Direct requirements matrix values

136
 Stability in Sector table
137

• Similar stability in other cells

Average 0.2120
St dev 0.0108

137
 Beyond Cells – Total Supply Chain
Results, 1992 to 1997: Electricity sector
138

1992 Benchmark IO Model 1997 Benchmark IO Model

Sector Economic($mill) Sector Economic($mill)
Total for all sectors 1.671098 Total for all sectors 1.708177
Electric services (utilities) 1.007134 Power generation / supply 1.007417
Coal 0.102573 Oil and gas extraction 0.093182
Repair / maint. constr. 0.087334 Coal mining 0.073502
Crude petrol. / nat’l gas 0.041535 Pipeline transportation 0.031778
Natural gas distribution 0.037961 Rail transportation 0.029385
Railroads & rail services 0.032541 Wholesale trade 0.024219
Wholesale trade 0.024300 Maint. & repair constr. 0.022235
Petroleum refining 0.023055 Petroleum refineries 0.022115
Real estate mgmt. 0.021044 Lessors intangible assets 0.021955
Banking 0.017472 Real estate 0.019175

138
 More about Sectors:
History of SIC, NAICS
• IO models ‘sector based’
139

 but have their own classification of sectors!

• Standard Industry Classification (SIC) – originally
developed in 1930s
 Structures economy for data/comparative purposes
 Since 1930s, significant economic changes – last updated ‘87
• North American Industrial Classification System
(NAICS) – made in 1990s by US, CA, MX
 Production-process based classification (similar groups)
 Standard categories, country-specific adjustments
 Maintains ability to compare across countries
 Aligned with UN International Standard Industrial
Classification (ISIC)
139
 Sectoral Classification Schemes
140
• ISIC – International Standard Industrial
Classification
• NAICS – North American Industry Classification
System
• NACE – Statistical Classification of Economic
Activities in the European Community

• Point: There are many. For bridges between

systems and comparisons, see Eurostat’s
Reference and Management of Nomenclatures
(RAMON) system
140
 NAICS Industry Sectors
141

• 6-digit NAICS codes (vs. 4-digit SIC)

• First 5-digits fixed, 6th for country specifics

• Example:
• 33 Manufacturing [Industry Sector]
• 334 Computer and Electronic [Industry Subsector]
• 3346 Manufacture/Reproduction [Industry Group]
• 33461 Manufacture/Reproduction [Industry]
• 334612 Pre-recorded Computer CDs [Country-specific]

141
 SIC vs. NAICS - High Level
142
• 11 Agric., Forestry, Fishing, Hunting
• 21 Mining / 22 Utilities/ 23 Construction
• Agriculture, Forestry, Fishing
• 31-33 Manufacturing
• Mining
• 42 Wholesale Trade/ 44-45 Retail
• Construction
• 48-49 Transportation / Warehousing
• Manufacturing
• 51 Information
• Transport/Infrastructure
• 52 Finance and Insurance
• Wholesale Trade
• 53 Real Estate and Rental
• Retail Trade
• 54 Professional, Technical Services
• Financial/Business Services
• 55 Management of Companies
• Other Services
• 56 Admin, Support, Waste
• Public Admin (Gov’t) Management & Remediation Services
• 61 Education Services
• 62 Health Care and Social Assistance
71 Arts, Entertainment, and Recreation
72 Accommodation and Food Services
81 Other Services
• 92 Public Administration 142
 IO Model Organization
See Advanced Material Section 4
143

• 2002 BEA benchmark IO tables organized into

about 430 sectors (“NAICS based”)
 1997 into about 490
• Many IO sectors 1:1 with 5-digit NAICS
• Others are 1:1 with 2, 3, or 4-digit NAICS, some
10:1 (e.g., agriculture)
• No obvious method for arbitrary selection
 Electricity / tortillas

143
 2002 Industry NAICS→IO map
(“Appendix A” file on Blackboard)
144

BEA I-O Industry Code and Title Related 2002 NAICS Codes
AGRICULTURE, FORESTRY, FISHING AND
HUNTING
1110 Crop production
1111A0 Oilseed farming 11111-2
1111B0 Grain farming 11113-6, 11119
111200 Vegetable and melon farming 1112
1113A0 Fruit farming 11131-2,111331-4, 111336*,
111339
111335 Tree nut farming 111335, 111336*
111400 Greenhouse, nursery, and floriculture 1114
production
111910 Tobacco farming 11191
111920 Cotton farming 11192
1119A0 Sugarcane and sugar beet farming 11193, 111991
1119B0 All other crop farming 11194, 111992, 111998

144
 Notes on Mappings
• “More high level sectors” does not alone mean
145

“better data” – just a different model!

• Some environmental/resource data is still given
in SIC format (not yet NAICS)
 Thus need multiple “mapping” functions
• Use of (re)-mapping functions leads to additional
data/model uncertainties – hard to quantify
• Auxiliaries – offices classified by ‘what they do’
rather than ‘who they serve’
 Corporate headquarters have their own sector

145
Environmental
Data for IO
Models

146
147
Adding environmental impacts
• Environmental impact calculation:
E = RX = R[I - A]-1 Y
• Augments IO matrix with sector-level
environmental impact coefficient matrices (R)
[effect/$ output from sector]
• Essentially adding another sector to the matrix
for the environment! Emission outputs from
industrial sectors are inputs to the “environmental
sector”…

147
 IO-LCA Models
148

• Environmental impact calculation:

E = RX = R[I - A]-1 Y
• Remember the recipes for wastewater in our 4-
sector economy (physical basis):

Wastewater Normalized
Soda 8 ounces per 10 0.06625
cans soda
Can 5 gallons per 1000 OR 0.005
empty can
Aluminum 1.58 gals per 1.58
pound Aluminum
Water 0
148
 Where do “R matrices” come from?
150

• Various government surveys collect information by

facility
 Energy use
 Air, water, toxicant emissions
 ...
• Each facility reports its primary industry sector
• Total input (e.g., energy) or output (e.g., GHG
emissions) per industry sector
• IO gives total production ($) per sector
• Calculate flow/$ per sector
• Simple?

150
 Where do “R matrices” come from?
Sample Data Mappings
151

• For electricity consumption of some electricity

sectors, data from DOE’s Manufacturing Energy
Consumption Survey (MECS)
 NAICS mapping → IO sector (easy!)

• Other manufacturing data comes in using SIC

classifiers
 SIC → NAICS → IO sector (harder)

• Repeat 400 times (for all sectors)

151
152
 Estimating R matrix values for
Electricity by Sector?
153

There are 29 IO sectors for food manufacturing, but MECS

only had specific data for 4 sectors in 2002.
Combine:
Electricity values above from MECS
Appendix A (mapping)
Total Industry Output by sector (from Make/Use Tables)
153
 Related
I-O Industry Code and Title 2002 NAICS
Codes
MANUFACTURING

Food manufacturing
311111 Dog and cat food manufacturing 311111
311119 Other animal food manufacturing 311119
311210 Flour milling and malt manufacturing 31121
311221 Wet corn milling 311221
31122A Soybean and other oilseed processing 311222-3
311225 Fats and oils refining and blending 311225
311230 Breakfast cereal manufacturing 311230

More from 31131A

311313
Sugar cane mills and refining
Beet sugar manufacturing
311311-2
311313
311320 Chocolate and confectionery manufacturing from 31132

Appendix A 311330
311340
cacao beans
Confectionery manufacturing from purchased
chocolate
Nonchocolate confectionery manufacturing
31133
31134
311410 Frozen food manufacturing 31141
311420 Fruit and vegetable canning, pickling, and drying 31142
R Matrix 31151A Fluid milk and butter manufacturing 311511-2
311513 Cheese manufacturing 311513
development 311514 Dry, condensed, and evaporated dairy product 311514
311520 manufacturing
Ice cream and frozen dessert manufacturing 311520
includes the 31161A Animal (except poultry) slaughtering, rendering, and 311611-3
processing
allocation of MECS 311615
311700
Poultry processing
Seafood product preparation and packaging
311615
3117

electricity data for 4 311810

311820
Bread and bakery product manufacturing
Cookie, cracker, and pasta manufacturing
31181
31182
food sectors across 311830
311910
Tortilla manufacturing
Snack food manufacturing
31183
31191
the 20+ IO food 311920 Coffee and tea manufacturing 31192
154 311930 Flavoring syrup and concentrate manufacturing 31193
sectors 311940 Seasoning and dressing manufacturing 31194
311990 All other food manufacturing 31199 154
 Conclusions
155

• Change in basis (and new data) requires

considerable conversion efforts
 Hundreds of hours in development years
• Payoff is more up-to-date estimates of economic
and sustainability metrics
• NAICS basis should increase power for
international comparisons

155
CMU’s EIO-LCA model

156
157
EIO-LCA Software
• Internet version http://www.eiolca.net/
• About 3 million users to date
• About 1,500 registered users
 update notices
 other benefits
• First LCA tool completely free on Internet in full
version (not a ‘demo’)

157
 Data Sources
158

• Best thing about input-output LCA: public

data = free
• Data sources for 2002 model from:
 Bureau of Economic Analysis (IO table)
 EPA (air pollution, Toxics, non-CO2 GHGs)
 DOE (Energy and CO2)
 DOT (transportation energy data)

158
 EIO-LCA Data Example
159

• Skim EIO-LCA documentation link posted

 Where do EIO-LCA data come from?
 What needs to be done to make it useable on the
web?
 Keep an eye out for any sectors related to your group
projects – possible data sources discussed?

159
CMU’s EIO-LCA model

160
 EIO-LCA website demo
161

• Different model options

 See tutorials and screencasts!

 Sector choice, etc.

 Total / direct results?

• Other model types (custom/etc.) will be shown

later in the course (hybrid LCA)

161
 EIO-LCA website demo
162

162
$100 million shoes
(2002 Producer model)

• Direct economic (sorted) = monetary amounts

purchased by Footwear manufacturing to make
their product
 Why $99.8M for Footwear? Co-product in other sectors…
• For Leather and hide tanning, $15.9M of materials
are purchased (15 cents per dollar of shoe
produced)

163
$100 million shoes (2002 Producer)

• Remember: Direct = Zeroth and 1st tier

• $165M = $100M (Zeroth) + $65M (1st tier)
 Footwear sector makes $65M purchases to create
$100M output
 $100M - $65M = $35M of value added

164
 $100 million shoes (2002 Producer)
• Sum of Total Economic Effects = $253M, including
the initial $100M and other direct purchases, as
well as all indirect (or supply chain) purchases (still
sorted on Direct)
 For Leather and hide tanning, $17.6M of materials are
purchased across the supply chain, 15.9M in direct
purchases (which leaves $1.7M in indirect purchases)

165
 $100 million shoes (2002 Producer)
• Sum of Total Economic Effects = $253M (sorted on
Total)
 $253M includes initial $100M directly to Footwear and
$153M of purchases from all other sectors in the economy
 Now Animal processing is 3rd in significance, shifting
Wholesale trade and Management down. No direct
economic contribution (supplier for Leather…)

166
 $100 million shoes (2002 Producer)
• Sum of Total Economic Effects = $253M (still sorted
on Total)
• Direct versus indirect at a glance…
 This percentage will be important when considering
environmental impacts
• Total = Direct + Indirect

167
Aggregated results
• EIO-LCA yields rolled up totals by sector

168
$100 million shoes (2002 Producer)

• Total Value Added = $99.4M

 = Sum of Employee Compensation, Net Tax, and Profits

169
 $100 million shoes (2002 Producer)

• Selecting Conventional Air

Pollutants gives US EPA air
pollutants regulated under the
Clean Air Act
• Cattle ranching … 11% of CO,
53% of NH3, 2% of NOx
• Where is Footwear?

170
 $100 million shoes (2002 Producer)

• Now sorting on NOx column, the order changes

dramatically
• Power generation accounts for 24% of NOx
generation (instead of Cattle ranching at 2%)
• Footwear now visible (3%)

171
 $100 million shoes (2002 Producer)

• Other environmental effects display in the same

way

172
$100 million shoes (2002 Producer)

• Represent TOTAL impacts. Use Direct

Economic% to allocate direct vs indirect
environmental effects by sector
 31.5% of Power generation impacts are associated
with direct purchases

173
$100 million shoes (2002 Producer)

• Therefore 31.5% of 21,800 tons CO2e from

Power generation (6,870 tons) is a direct impact
of $100M output of Footwear

• Remember Cattle ranching is only a supply chain

(indirect) purchase. Difficult to reduce carbon
footprint through direct purchases?

174
Environmental Life Cycle
Assessment
CEE 12-714 / EPP 19-714
Lectures 12 through 15: Introduction to Input-Output
Based LCA - Part 4

March 7, 2018
 Administrivia
• Pop quiz 1 (from Monday)
 Pick up after class?
 Bonus HW points
 It will happen again
 Q2 “Under what specific circumstance must an ISO-14040
compliant LCA have an external critical review?”
 When the LCA makes “comparative assertions”… that your
product is better than their product
• Regular office hours this week, none next week
• HW4 due Friday, midnight, March 9 (1 day
extension)

Spring Break next week! 176

Group Project
• Next deliverable: Revised and expanded goal and
scope document
 Due 3/21/2018 (Wednesday after Spring Break)
 10 project points
 Markedly more than first submission
 10-20 pp
• Describe your modeling approach to each life cycle
stage of your product/process
 Identify unit processes
 Scenarios and assumptions (justified)
 Uncertainty ranges or distributions
• Demonstrate responsiveness to my comments

177
Group Project
• You must have at least one meeting with me
before submission (full team)
• My current availability (Team 5?):
Mon, 7th Tues, 8th Wed, 9th Thur, 10th Fri, 11th
1:30: Tm 2 All day in 1:00-4:00 8:00-9:00 Not
Cohon 11:00-2:00 available
Center,
Connan 9:00: Tm 4
Room 10:00: Tm 1
Mon, 19th Tues, 20th Wed, 21st
10:30-12 Too late for Revised
1:30-4:20 useful goal and
meeting scope due
4:20: Tm 6
178
Group Project
• Purchasing plan
 Still need to hear from Team 4 (Blue Apron) and
Team 5 (Drone Pizza)
 Budget and timeline
 How much will your supplies cost?
 When do you need your supplies delivered (and when
should you order them)?
 Email this information to me today (March 7)
 Know the specific URLs for your orders
 Deliver to whom? … name and address
 We MUST go through the CEE office to make
purchases
179
 ISO 14040: Figure 1

Phases of an LCA
180

• Goal and scope definition

• Inventory

• Impact assessment

• Interpretation

180
 Life Cycle Inventory
181

181
Today
• Producer versus Purchaser EIO-LCA model
• Temporal integrity
• Using EIO-LCA case studies
• Introducing Matlab EIOLCA

182
Finishing up from Monday

183
 Aggregating Results
184

• What happens if we don’t have source data at

the “400 sector detail” level?
 Running model at 97 versus 482 sector level (in
1992)?
 Compare effects of $1M production in a given sector
(say “Electric services (utilities)”)

184
 487 vs 97 sectors in 1992

487

97

185

185
 EIO-LCA model types
186

• Producer versus purchaser prices

See Chapter 8, Advanced Materials (pp. 218, 231, 249, 251)

186
 EIO-LCA model types
187

• Producer prices – what it costs producers to

make
 Cradle to gate scope
 Sum of production costs, labor, etc.
 Value of final demand input may be hard to get

187
 EIO-LCA model types
188

• Purchaser prices – what final buyers pay

 Cradle to consumer scope
 Can include transportation from producer, wholesale,
retail operations, sales tax, aka “margins”
 Generally, the “final demand inputs” for these models
are really easy to get (e.g., sticker price of a car)

188
 See Purchaser Producer
Cost Map
Model types 2002.xls in Canvas

• Differences between Producer and Purchaser

models impact results to different degrees
 Point of production (service sectors may have no
transportation or retail components) – no difference
 Carbon intensity of transportation – higher emissions
for Purchaser model

Producer Wholesale Transportation Retail Purchaser

Sector Name
Price trade trade Price
Air Rail Water Truck Pipeline
Footwear
0.94149 0.02044 0.00188 0.00012 0.00000 0.03606 0.00000 0.00000 1
manufacturing
Couriers and
0.94802 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.05198 1
messengers
Internet service
providers and web 1.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 1
search portals
189
 Purchaser versus Producer ($100M
Footwear)

Producer

Purchaser

190
 Producer Models
191

• Prices — what do you have?

 Yearly average prices at producer level, not retail!

• Two types of goods: mostly “intermediate”,

mostly “final”
 “intermediate” goods usually already producer priced
 “final” goods have to adjust using producer/retail ratio

191
 Purchaser Models
192

• Valued as prices paid by final customers (not

necessarily just consumers – some are bought by
companies)
 Roughly equivalent to retail price

• Include several steps within boundary beyond

producer price
 Warehousing, Distribution, Transportation, Retail, etc.

 Purchaser IO models already have these extra steps built in

 Decide whether your analysis needs to handle these steps
separately (and thus use Producer models)

192
 Using purchaser prices
193

• If know type of purchaser (household, business,

government) and $
 Can use ratios from detailed use tables to split
 $purch = $prod + $whole + $ret + $transport

• EIO-LCA uses matrix math to distribute these values

into separate components of final demand

• In MATLAB code, this is what purchtransmat does

193
 Fractional Margin Shares
194

Normalize components on whole purchaser price basis.

Ex: Y= $25k purchaser price car would be split into $22k in

auto mfg, $2,500 in wholesale trade, etc. in purchaser model.
LCA effects might be higher or lower than producer only model

See Purchaser Producer Cost Map spreadsheet posted on Canvas for

Lecture 15
194
What year is it?
See Chapter 8, Advanced Material Section 3

• 2002 US EIO model input must be in 2002

dollars
 If your scope uses a different base year, a conversion
is needed to match the temporal basis
• Adjust valuation using economic price index or
GDP deflator for a particular sector
 In the U.S., the BEA posts these indices

195
IO-LCA
Examples

196
 Illustrative Example
197

• You work for a drug company, and you are asked

to estimate your product’s carbon footprint
• To make your life easier, you focus on your
processes’ top 10 “direct inputs”
 Could get this from product manager, accounting, other
departments
 Assume that your primary inputs are the primary
sources of impacts for LCA
• This is a common boundary assumption

197
 Top Actual “Direct” Inputs for Drugs
198

• Chemicals • Printing
• Plastics • Computer services
• Electricity • Telephone services
• Paperboard/boxes • Refined petroleum
• Paper (e.g., gas/diesel)

• Trucking

198
 Drug Manufacturing Greenhouse Gas
Emissions
199

Rest of Supply Chain

35% Top Ten Locally Used
219 306 Inputs
49%

Other Locally Used

Inputs
16% Your initial boundary
There are significant emissions would have missed 50+%
from support services within of greenhouse gases
the firm and also across supply chain

(Note these were for 1997 model, may have changed slightly)
199
 Lessons Learned
200

• Your perception of ‘what matters’ is biased by

local factors
 Overestimates importance of these items
 Underestimates supply chain effects
• Our perceptions of ‘process inputs’ usually are
goods not services
 Services are not environmentally benign!
• Use EIO-LCA to help you frame your LCA
problems and set your boundaries (screening)

200
 Impact of Service Industries
201

• Presumption: manufacturing / industrial

operations are impact intensive
• Service sectors …
 are large part of economy
 have non-negligible impacts

Inspired by Rosenblum, Horvath, and Hendrickson, ES&T, 2000. 201

 Relative Economic Contributions
202

According to BEA, in 2009 services accounted for 79.6 percent

of U.S. private-sector gross domestic product (GDP), or $9.81
202
 Direct + Indirect energy use (1992)
203

203
 Energy Use per $million (1992)
204

204
 Takeaway Messages
205

• Some service sectors comparable to

manufacturing sectors

• Certainly not negligible in general

 Do not by rule ignore or exclude them!

• Pervasive $ requirements in our examples

205
 Summary: IO-LCA
206

• Simple, fast method for cradle-to-gate LCA

 No use phase or disposal phase — must be added

• Very useful for scoping impacts of a good or service

(as defined by a sector)

• May be a good estimate for actual products

 But may not!

• Can inform the boundary and scope of a traditional,

process-based LCA study

206
 Group Exercise: Simulating Life
Cycles
207

• We call it an eio-“LCA” model…

 We use economic inputs to get results
 Producer model gives “production impacts only”
 Purchaser model gives impacts through delivery to
customer
• (How) can we simulate the whole life cycle of a
car using only EIO-LCA?
 Think back to discussion on life cycle costing from
Lecture 3
 Spend 5-10 minutes thinking about this

207
 Extensions: Going Beyond Sector
Definitions
208

• Given an existing IO model (e.g., the 2002

model)
 and its sector definitions
 and its average production definitions

• Can we “drill down” to study a subset of that

sector?
 e.g., 1997 model – automobile and light truck sector…
A drill down?
 What are data required to do this?

208
 EIO-LCA in MATLAB
209

• EIOLCA.net is powerful, fast, accessible

• Matlab version allows for more nuanced analysis
• Make sure to study Matlab resources in Canvas
 Try demo
 Use Google for specific questions!

209
 Can we redo the Soda exercise?
211

>> iden44 = eye(4) >> Al = [0;.5;0;1.58]

>> Water = [0.0005; 0; 0.005; 0]

>> Soda = [0;1;0;.1]

>> A = [Soda, Can, Al, Water]

>> Can = [0;0;0.03125;.005]

211
 Soda exercise in Matlab continued
>> IminusA = iden44-A >> X = inv_IminusA*Y

>> inv_IminusA = inv(IminusA)

Same result we saw X=[I-A]-1Y

in Excel: S 1,000,078
C 1,016,350
>> Y= [1E6; 0;0;0]
A 32,543
W 156,508

212
 Soda exercise in Matlab continued

>> E = R_water_diag*X
>> R_water = [0.0063, 0.005, 1.58, 0]

>> R_water_diag = diag(R_water) >> E = R_water*X

>> save sodaexample.mat

213
Download 2002 EIO-LCA in Matlab

214
Download 2002 EIO-LCA in Matlab
• Install Matlab on your computer or find a cluster
computer.
• Download the EIO-LCA zip file and extract it as a
folder.
• Read the README.doc file in that folder for
additional instructions on how to use it.

215
 Checking EIO.mat vs website
216
• Can look inside .m file of EIO-LCA 2002 matlab
environment to see how to do things ourselves…

• Easy to see how we can “run the model” by

hand without using script for $1M of input (y)

• Can do things we cannot do on website, e.g.,

run the model and summarize which sectors
have most total GHG emissions per $M … (hint:
not same as having a y vector with $1M in every
row)
216
 Solution
217

• In the EIOLCA02 MATLAB environment, there

are several matrices that have the “R matrix”
values for the various energy/environmental
flows in the model
 All are in units of “impact per million dollars”

• EIvect: 12x428 matrix that has the energy and

GHG emissions flows that match the website
 Total Energy (TJ), Coal, NG, … Total CO2e, Fossil
CO2, Process CO2, …

217
 Running EIOLCA in MATLAB
218

• Where are the files for EIOLCA?

Not here?
Change the
directory to
where you
downloaded the Then, double-click on
EIOLCA files… Readme.doc, and read…
218
 Running EIOLCA in MATLAB
219

Double-click here to open

code in Editor window so
you can see what’s
happening

Then, enter the program

name into the command
window, and hit return
219
 EIOLCA in MATLAB
220

• Default mode: $1M into the Oilseed farming sector

• Producer results for $1M in Oilseed farming
 When prompted, enter “1” to run the Producer price model
 Enter “final” to use the default demand vector
 Enter your own Output file name (e.g., ProducerTest.txt)
• Purchaser results for $1M in Oilseed farming
 When prompted, enter “2” to run the Purchaser price
model
 Enter “final” to use the default demand vector
 Enter your own Output file name (e.g., PurchaserTest.txt)

220
 EIOLCA in MATLAB
221

• Summary results
scroll in the
Command window
• Detailed results
stored in your
designated .txt
file, visible in
“Current Folder”
window

221
 EIOLCA in MATLAB
222

• Preview results by doubleclicking on .txt files in

“Current Folder”
 Shows all columns and rows, semicolon delimited
 Scroll across columns to see all the categories of
results
 Highlighted: Total economic impact for Oilseed farming

222
 EIOLCA in MATLAB…and then Excel
223

• Can also look at raw results by double-clicking

the “finalout” matrix in the Workspace window

 Can open .txt files in Excel

223
 MATLAB into Excel
224
• Import with “Text to columns”; semicolons for delimiters
• Add filters, format columns, etc.
• Look at all the columns of interest (“total econ, $M” here,
plus all the other categories in eiolca.net at one time)

224
MATLAB into Excel
• You can also use MATLAB commands to write
your matrices into .xls files:
• >>
xlswrite('EIOsecnames.xls',EIOsecnames)

• Lots of ways to get to the same result.

225
 Circle back to eiolca.net…
226

• Confirm MATLAB EIOLCA gives the same

results as eiolca.net (with added benefit of all of
the impact categories in one file)

226
 How to change the sector?
227

• The default EIOLCA model uses a “final”

demand vector (428x1), with “1” in the first row;
corresponds to demanding $1M from Oilseed
farming
• Create a new demand vector, “y”, (428x1) to
change the demand
 First create a zero matrix of the correct dimensions
 >> y = zeros(428,1);
 Then modify the zero matrix to include a demand in
the row corresponding to your target sector

227
 How to change the sector?
228
• Use EIOsecnames to find your target sector row
 Could scroll through matrix in Editor window

• OR, could search using a string match command:

 >> x=strmatch('Power', EIOsecnames)
 And then examine those rows:
 >> Row31 = EIOsecnames(31)

228
 How to change the sector?
229

• Then set the 31st row in your new demand matrix,

y, to be equal to your input value (“1” for $1M)
 >> y(31,1)=1;
• Now, rerun the model, using your new demand
matrix, y, and specifying a new .txt file for the
results for the Power generation and supply sector
(e.g., “PowerGeneration_Producer.txt”)
 >> EIOLCA02
 Save your work (local files):
 >> save test2018.mat

229
 Compare to eiolca.net…
230

230
Questions?

231
Next
• Return to process-based LCA, using matrix
methodology
• Begin reading Chapter 9, through p. 267
• Office hours today and tomorrow (none next
week during Spring Break)
• HW4 due Friday, midnight
• Updated project goal and scope due 21Mar,
Wednesday after break
• HW5 released Friday, due 29Mar

232