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The way eco-costs of emissions are determined

General concept of marginal prevention costs

An overview of the basic calculation the eco-costs by means of LCA is provided at the webpage on the concept.
This webpage gives more information on how the multipiers from midpoints to endpoints (the marginal prevention costs) have been derived.


The eco-costs are the marginal prevention costs of toxic emissions which is derived from the so called prevention curve as depicted in the adjacent picture Fig. 2.2a. The basic idea behind such a curve is that a country (or a group of countries, such as the European Union), must take prevention measures to reduce toxic emissions (more than one measure is required to reach the target). From the point of view of the economy, the cheapest measures (in terms of euro/kg) are taken first. At a certain point at the curve, the reduction of the emissions is sufficient to bring the concentration of the pollution below the so-called negligible-risk-level or 'no-observed-adverse-effect level' . The negligible-risk-level of CO2 emissions is the level that the emissions and the natural absorption of the earth are in equilibrium again at a maximum temperature rise of 2 degrees C. The negligible-risk-level of a toxic emission is the level where the concentration in nature is far below the toxicity threshold, or below the background level. The negligible-risk-level is a factor 10-100 lower than the Maximum Allowable Risk Level (MAR, or Threshold Limit Value, which is applied to indoor working conditions), The MAR is the level of less than 1 fatal illness per million people, or more than 95% surviving plants in nature. The negligible-risk-level is never lower than the natural background concentration.
The factor 10-100 has been introduced to be safe side with respect to the risk of so called "cocktails" of toxic substances in nature.
Note that most toxic substances are only toxic above the toxicity threshold level. Below this treshold they might even be healthy, see Fig. 2.2b.

Detailed information on the first original calculations are provided in (Vogtländer et al., 2000). Although the calculations are made on the situation for The Netherlands, it can be argued that these required Available Technologies (BATNEC = "Best Available Technologies Not entailing Excessive Costs") might be applied for other Western European countries as well. This is because of the fact that the costs of BATNEC measures are assumed to be the same all over Europe.
There are 6 issues with regard to this type of calculations:

(1) the calculation is regarded as quite stable in time, since the BATNEC does not change when the other, cheaper measures are taken first
(2) the eco-costs calculation for Global Warming was derived from one of the first Marginal Abatement Costs MAC) curves, MARKAL, used to base the Dutch environmental policies on (many other countries followed in the period 2004 - 2010), however, most MAC curves include the time at the x-axis and apply price discounting. The eco-costs curve does not include the factor time: it is a "what if now" philosophy to improve transparency and reduce uncertainties in predictions (assumptions). Eco-costs do not predict when a measure is taken.
(3) the required marginal costs, however, become more expensive when some measures are rejected for political reasons: a more expensive BATNEC is then needed to reach the negligible-risk-level
(4) on the other hand, economies of scale and learning curves might reduce the costs of the last required measure
(5) point (3), and the hope on future lower prices of point (4), has the effect that in practice politicians tend to introduce measures which are easily accepted by the public, however, which are more expensive than the marginal BATNEC; this is called 'revealed preference'
(6) the most important changes since 2000 are of the type of point (5): there are many 'revealed preferences' that are a bit more expensive than the BATNEC of the basic curve, leading to higher eco-costs in the 2017 version 1.6 (this effect is accelerated by the sense of urgency caused by the" Paris agreement").

Note that the calculations of 1999 have been revised three times: in 2007 and in 2012 and in 2017.
The eco-costs of emissions of other pure substances are given in the excel sheet "ecocosts 2017 midpoint tables" under tab data.

Specific information on marginal prevention costs of emissions

Global warming

The eco-costs of global warming: 116 euro / 1000 kg CO2 equivalent
The midpoint table for global warming: Global Warming Potential 100 years, IPCC 2013
Some background information:
These eco-costs are related to the "last required measure" (the norm for sustainability) of the prevention curve. In other words: with a costs level of 116 euro per 1000 kg CO2 for CO2 Allowances (in the EU Emissions Trading System, as well in other Tradable Emission Right systems in the world), the world is expected to have an equilibrium in the CO2 concentration in the atmosphere, at the 2 degrees Celsius norm for the global rise of temperature. The "last requierd measure" in the curve is sustainable electricity by windmills at the North sea. In 2019 this prevention measure can also be regarded as 'revealed preference', since it is applied on a wide scale (regardless of the fact that other measures that are less expensive, like underground Carbon Storage Systems, are still to be implemented).
The calculation of the 0.116 euro/kgCO2 is based on the replacement of electricity from a coal fired power plant, by renewable energy from an offshore windfarm. For the eco-costs 2017, the results of a tender for the Dutch 'Borssele 1+2' windfarm (94 windmills of 8 MW) were taken as a norm: 7.27 euro cent per kWh excluding the electricity cable to the shore. For 'Borssele 1+2' the costs of the cable is 1.4 euro cent per kWh. Since the future windfarms have more than double distance to the coast, a price norm for the connection to the shore is set to 2.8 euro cent per kWh. So the costs of this type of renewable electricity is 10.07 euro cent per kWh. The Danish 'Horns Rev3' windfarm costs 10.30 cents per kWh. This electricity is supposed to replace electricity from a coal fired power plant. The marginal costs of electricity from coal is estimated at 1.40 euro cent per kWh (derived from 55 euro per ton coal and an efficiency of a modern power plant of 45%). The CO2 emissions are 0.75 kg/kWh. This results in (0.1007 - 0.0140 / 0.75 = 0.116 euro/kg CO2.
Note 1. The reason that the marginal costs of coal have been taken is that a back-up power plant is still needed for the case that there is not enough wind, so the infrastructure of fossil based power plants is still required (small modifications are needed to make the power plant flexible with a start-up time of approx. 3 hours plus a huge battery pack to bridge this start-up time).
Note 2. The 'capacity factor' is 40 - 42 % for the North sea (the capacity factor = 'electricity production' / 'installed power'), see capacity factors and load duration curves for Denmark
Note 3. Nuclear power is not part of the prevention curve, since it is regarded as unsustainable because of (1) the operational risks, and the end-of-life problems (2) the fact that such a power plant can not deliver flexible supply of electricity (technically nor financially)
Note 4. The original prevention curve from 1999 would have resulted in 145 euro / kg CO2 when corrected for inflation. The main reason that the actual eco-costs are lower is the higher efficiency of bigger windmills (approx. 25%)

Acidification

The eco-costs of acidification: 8.75 euro / kg SO2 equivalent (= 6.68 euro / mol H+ eq)
The midpoint table for acidification: ILCD 2011 Midpoint+ (including EU country factors)
Some background information:
These eco-costs are related the current revealed preference of Ultra Low Sulphur Diesel Production in the EU of 10 ppm.
For acidification, the latest development of diesel desulphurization has been applied as revealed preference, which costs 0.036 $/gal from 600 ppm -> 5 ppm (a new catalyst of the University of Louisville makes ULSD feasible at small refineries). This stems from 0.0104 euro per kg diesel (1 gallon = 3.785 litre, 1litre = 0.83 kg, 1.13 US$ = 1 euro) for 0.595 g Sulphur per kg diesel, resulting in 17.51 euro per kg Sulphur or 8.75 euro per kg SO2.
This is near the original prevention curve of 1999, which would have resulted in 8.83 euro / kg SO2 equivalent, after inflation correction.
Note. A recent paper showed that the eco-costs of ULSD of 10 ppm Sulphur is near the optimum, i.e minimum cradle-to-grave emissions (Olinda et al., 2019)

Eutrophication

The eco-costs of eutrophication: 4.70 euro / kg PO4 equivalent (= 14.40 euro / kg P eq)
The midpoint table for eutrophication: ILCD 2011 Midpoint+ (including EU country factors)
Some background information:
These eco-costs
are related to the costs of sustainable manure treatment. The price in the Neterlands is about 4.7 euro/kg PO4.
The factor 4.7 euro / kg PO4 equivalent has been checked with the current situation with regard to the loss of biodiversity in the Baltic sea caused by eutrophication. These eco-costs seems to be just sufficient to tackle the problem of the high concentrations in the main rivers that enter the Baltic sea by water treatment systems for the effluent of cities bigger than 10.000 inhabitants (Hautakangas et al., 2014).
Note: NH3 and NO2 (in air) have been allocated to eutrophication (acidification has zero to avoid double counting), since that is the issue now in the European Union. The prevention measure for NH3 is a air scrubber, the prevention costs are 17.2 euro/kg NH3, see (De Pue et al., 2020). Consequential, the prevention costs of NOx is then 6.37 euro per kg, because of the mol weight ratio of 2.7 for both substanses..

Photochemical oxidant formation (summer smog)

The eco-costs of summer smog: 5.35 Euro/ kg NOx equivalent = 9.08 euro/kg C2H4 eq)
The midpoint table for summer smog: LOTOS-EUROS model
Some background information:
Summer smog is caused by NOx emissions (primarily from cars and trucks) and Volatile Organic Compounds (VOC) from the chemical industry.
The first prevention curve in 2000 (Vogtlander et al.2000), appeared later too negative for several reasons (change from chemical solvents in paints to water based paints and better motor management in cars). In 2007 a new prevention curve was calculated (Vogtlander et al. 2010), based on a additional studies on prevention measures in the petrochemical industry (Cronenburg et al., 2000) (Jantzen et al., 2003) ,plus new data on emissions from traffic. Inflation correction on these marginal prevention costs results in 10.38 euro per kg C2H4 equivalent.
There is a revealed preference now for NOx emissions. It relates to a general trend in Europe to reduce NOx emissions by cars (and trucks) in cities: the Euro 5 and Euro 6 norm are not strict enough, especially because the road emissions are much higher than the lab tests (according to Baldino et al 2017, the average road emission for Euro 5 cars is 4.0 times higher than the Euro 5 norm of 0.18 gram per km). The new trend (revealed preference) is that all vehicles should have AdBlue Selective Catalytic Reduction (SCR) filter.
For an average middle class European car (e.g. Opel Insignia of Peugeot 508) the prevention of these emissions requires injection of 1 litre AdBlue (32.5% urea in demineralised water) per 1000 km. The costs of AdBlue at a fuel station is 60 euro cents, so the prevention costs is 0.6 / (0.18x4.0x0.9) = 0.92 euro per kg NOx (filter efficiency = 0.9).
The investment costs of the filter itself is estimated at 1750 euro (AutoBild 2019). When we assume a life span of 250.000 km , an amount of 0.65 x 250 = 162 kg NOx is reduced, resulting in prevention costs of 1750/162 = 10.80 euro per kg NOx. The SCR filter plus the AdBlue has10.80 + 0.92 = 11.72 euro/kg NOx prevention costs in total.
In the eco-costs system we have the issue of avoiding double counting, so we have to allocate the 11.72 euro per kg NOx to 2 midpoints: eutrofication and summer smog (photochemical oxidant formation). In eutrophication the contribution is 6.37 euro per kg NOx. So 11.72 - 6.37 = 5.35 euro per kg should be allocated to photochemical oxidant formation.
.

fine dust PM 2.5

The eco-costs of fine dust PM 2.5: 35 euro / kg fine dust PM2.5 equivalent
The midpoint table for fine dust PM 2.5: UNEP/CETAC plus
ILCD 2011 Midpoint+
Some background information:
The PM2.5 midpoint data are from the UNEP/SETAC report (Fantke et al., 2016). The old table of ILCD 2011 Midpoint+ and Soot and TSP have been added (PM10 data) for practical reasons, since they still exist in old LCI lists.
The factor of 35 euro / kg PM 2.5 equivalent has been based on data for fine dust filters of cars (case: Volvo V70), and the jump from Euro 3 to Euro 5. The emission reduction is 0.05 g/km, with a life time of 300.000 km. The price of a filter is 525 euro.

Ecotoxicity

The eco-costs of ecotoxicity: 340 Euro/ kg Cu equivalent
The midpoint table for ecotoxicity: UseTox 2 (recommended plus interim), freshwater ecotoxicity
Some background information:
The prevention costs of ecotoxicity has been changed drastically for the eco-costs 2017. The 'lead substance' (the most important emission in he list) is still Copper, since the emissions of Copper in our society are quite high
, and the ecotoxicity of Copper is high as well. In the eco-costs 2012, the prevention costs were 55 euro / kg Copper, derived from the water treatment costs in big municipal water treatment facilities. The water treatment costs of smaller industrial systems are, however, a factor 6 higher (Bijstra et al.2018) .

Human toxicity

The eco-costs of human toxicity: 3754 Euro/ kg Benzo(a)pyrene equivalent
The midpoint table for ecotoxicity: UseTox 2 (recommended plus interim), cancer
Some background information:
The eco-costs of human toxicity can only be determined via the DALY (Disability Adjusted Life Years), were 1 Case in the UseTox Tables equals 11.5 DALY.
In the medical science, the DALY is used to make comparisons in terms of prevention costs. It was developed by the WHO to access the costs efficacy of medical cure in the developing countries (where financial resources are scarce). Because of the progress in medical science, efficacy of medical care in the rich countries becomes an issue as well ("we cannot give more medical treatment than our society can afford"). For pharmaceutical products a maximum price of 40.000 to 50.000 euro per DALY is accepted in Europe and the USA, however, higher prices are suggested for medical cure in hospitals. In the USA the price of kidney dialysis ("the dialysis standard") is proposed as the maximum price for 1 DALY (King et al. 2005) (Grosse, 2008), being 82.000 US $ in 2009 (NIH, 2012). Although the DALY cannot be used as tool for medical decision making on the level of the individual patient (Cleemput et al., 2011), it is often used for general guidance for higher level policy decisions. RVZ (2007) proposes 80.000 euro per DALY in Europe (this 80.000 euro is still used by the Dutch government).. One of the basic principles for the eco-costs, as well as for the s-eco-costs, is that a life in a poor country has the same value as a life in a developed country, so we apply 80.000 euro per DALY.
Applying the factor 11.5 DALY per Case and 80.000 euro/DALY to the tables you will find 3754 Euro/ kg Benzo(a)pyrene equivalent. This factor was also applied in the eco-costs 2012 (there si no need for any inflation correction)
Note: Only the table of cancer is applied in the eco-costs system. This is because of the fact that the non-carcinogens table has more than 97% overlap, and the eco-costs in the table of cancer are much higher than in the table of non-cancer (in most of the cases more than a factor 100). So the non-cancer eco-costs are negligible in comparison to the cancer eco-costs. Furthermore there is the issue of double counting (forbidden in the ISO 14044, section 4.4.2.2.3)

Ozone layer depletion

The eco-costs of ozone layer depletion are estimated at: 120 euro / kg CFC-12 equivalent
The midpoint table for ozone layer depletion: ILCD 2011 Midpoint+
Some background information:
The eco-costs (i.e. the prevention costs of CFCs) is determined by the price of refrigerant HFO-1234yf in cooling systemes
These eco-costs are in practice negligible in comparison with the much eco-costs of the same substances in the global warming characterisation tables. Moreover, the classical CFCs are forbidden for any applications in Europe and the US. So the eco-costs of ozone layer depletion are set to zero.

Plastic soup in the ocean

The issue of the 'plastic soup' is dealt with in the midpoint 'use of energy carriers' (embedded in products). In the calculation of the marginal prevention costs (i.e. the eco-costs), the price of feedstock for plastics is based on the substitution of oil&gas by 'second generation' oil from biomass (pyrolysis of agricultural waste, wood harvesting waste, or algae), and producing bio-degradable plastics from it. By this substitution, the increase of plastic soup is stopped. However, the problem of the plastic soup that exists already is not resolved by this prevention measure.
For a further description on how to calculate this prevention measure, see tab "eco-costs of materials scarcity" under the heading "use of energy carriers" (embedded in products).

Reference

AutoBild 2019. Diesel umrüsten (SCR): Euro-5-Diesel nachrüsten — 04.10.2019
Baldino et al. 2017. Road Tested: Comparative overview of real-world versus type-approval NOx and CO2 emissions from diesel cars in Europe, The International Counsil of clean transportation.
Bijstra et al, 2018 .Kosteneffectiviteit van maatregelen ter beperking van wateremissies (Cost effectiveness of measures for restriction of water emissions). Dutch Ministry of IenW.
Cronenburg et al., 2000, VOS Reductiepotentieel Onderzoek(VOC reduction potential survey). Dutch Ministry of VROM (only harcopy available on request)
Cleemput et al., 2011. Using threshold values for cost per quality-adjusted life-year gained in healthcare decisions. Int. J. Technol. Assess. Health Care 27 (1), 71e76
Fantke et al., 2016. Global Guidance for life cycle impact assessment indicators, Volume 1" 2016, United Nations Environment Programme , see Table 4.2
Grosse, 2008. Assessing cost-effectiveness in healthcare: history of the $50,000 per QALY threshold. Expert Rev Pharmacoeconomics Outcomes Res 8 (2), 165-178.
Hautakangas et al., 2014. Nutrient Abatement Potential and Abatement Costs of Waste Water Treatment Plants in the Baltic Sea Region. doi: 10.1007/s13280-013-0435-1
Jantzen et al., 2003."Kosteneffectiviteit VOS", (Costs effectiveness VOS), TME
King, et al., 2005. Willingness to pay for a quality adjusted life year: implications for societal health care resource allocation. Med Decis. Mak. 25 (6), 667e677
Olinda et al., 2019."The Role of Hydrogen in the Ecological Benefits of Ultra Low Sulphur Diesel Production and Use: An LCA Benchmark. Sustainability" 2019, 11, 2184 .
NIH, 2012. U.S. Department of Health and Human Services National Institutes of Health. Kidney Disease Statistics for the United States. NIH Publication. No. 12e3895 June 2012.
De Pue D, Buysse J. "Safeguarding Natura 2000 habitats from nitrogen deposition by tackling ammonia emissions from livestock facilities", 2020 Environmental Science & Policy 111:74-82 DOI: 10.1016/j.envsci.2020.05.004
RVZ, 2007. Raad voor Volksgezondheid en Zorg: Zinnige en Duurzame Zorg. (Sustainable helth care that makes sense) 2007 Dutch Ministry of Health
Vogtländer et al., 2000. The "virtual pollution prevention costs '99", a single LCA-based indicator for emissions,Int. J. LCA, 5 (2), pp.113 -124, 2000
Vogtländer et al., 2010. LCA-based assessment of sustainability: the Eco-costs/Value Ratio (EVR). Original publications on the theory, updated with eco-costs 2007 data, VSSD, Delft, 2010. (http://www.vssd.nl/hlf/b004.htm)

see also under tab data, reference 1.0 and 2.0

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