Measuring raw-material criticality of product systems through an economic product importance indicator: a case study of battery-electric vehicles

Abstract

Purpose The concept of criticality concerns the probability and the possible impacts of shortages in raw-material supply and is usually applied to regional economies or specific industries. With more and more products being highly dependent on potentially critical raw materials, efforts are being made to also incorporate criticality into the framework of life cycle sustainability assessment (LCSA). However, there is still some need for methodological development of indicators to measure raw-material criticality in LCSA. Methods We therefore introduce ‘economic product importance’ (EPI) as a novel parameter for the product-specific evaluation of the relevance and significance of a certain raw material for a particular product system. We thereby consider both the actual raw-material flows (life cycle inventories) and the life cycle cost. The EPI thus represents a measure for the material-specific product-system vulnerability (another component being the substitutability). Combining the product-system vulnerability of a specific product system towards a certain raw material with the supply disruption probability of that same raw material then yields the product-system specific overall criticality with regard to that raw material. In order to demonstrate our novel approach, we apply it to a case study on a battery-electric vehicle. Results Since our approach accounts for the actual amounts of raw materials used in a product and relates their total share of costs to the overall costs of the product, no under- or over-estimation of the mere presence of the raw materials with respect to their relevance for the product system occurs. Consequently, raw materials, e.g. rare earth elements, which are regularly rated highly critical, do not necessarily reach higher criticality ranks within our approach, if they are either needed in very small amounts only or if their share in total costs of the respective product system is very low. Accordingly, in our case study on a battery-electric vehicle product system, most rare earth elements are ranked less critical than bulk materials such as copper or aluminium. Conclusion Our EPI approach constitutes a step forward towards a methodology for the raw-material criticality assessment within the LCSA framework, mainly because it allows a product-specific evaluation of product-system vulnerability. Furthermore, it is compatible with common methods for the supply disruption probability calculation — such as GeoPolRisk, ESP or ESSENZ — as well as with available substitutability evaluations. The practicability and usefulness of our approach has been shown by applying it to a battery-electric vehicle.

On the History and Future of 100% Renewable Energy Systems Research

“…However, a holistic analysis of material criticality for 100% RE systems until 2050 and beyond represents a substantial research gap. This also requires a feasible and meaningful concept of criticality in terms of the likelihood and potential impact of shortages in raw material supply [406].…”

An Integrated Model to Conduct Multi-Criteria Technology Assessments: The Case of Electric Vehicle Batteries

“…For the LIB case study, the ESSENZ characterization factors useful for global supply chains were used, as recommended by the Life Cycle Initiative. , The second part of the criticality indicator, vulnerability to supply disruption, is based on the economic vulnerability score of a product system to price hikes of a certain material. Lütkehaus et al calculated this as the cost of a material as a fraction of the total product life cycle cost. Following this, the only parameter that is still required for the criticality indicator is the flows of materials, calculated using the matrix-based SFA model formulation.…”

“…58,59 The second part of the criticality indicator, vulnerability to supply disruption, is based on the economic vulnerability score of a product system to price hikes of a certain material. Luẗkehaus et al 57 calculated this as the cost of a material as a fraction of the total product life cycle cost.…”

“…Multipliers were thereby calculated from the percentage used to determine the overhead cost, such as profits (e.g., 5% from total investment cost) or depreciation (e.g., 10% of capital equipment and 5% of floor space); see also p. 122 of Knehr et al 37 Material criticality is typically defined as the relation between (1) the supply disruption probability related to short-term socio-economic aspects and (2) the vulnerability to such disruption. 56 In this study, the criticality indicator is based on the product level criticality calculation as described by Luẗkehaus et al 57 by multiplying the supply disruption probability of a product system with its vulnerability score. The supply disruption probability is thereby based on the demand for materials, expressed as kg of element e, with a supply risk characterization factor.…”

Assessing Short-Term Supply Disruption Impacts within Life Cycle Sustainability Assessment─A Case Study of Electric Vehicles

“…Other studies have assessed supply disruption impacts by applying criticality assessment approaches integrated into the life cycle sustainability assessment (LCSA) framework because such approaches offer, among other benefits, the possibility to avoid burden-shifting between supply disruption impacts and environmental impacts. For example, Gemechu et al, Cimprich et al, Santillan-Saldivar et al, and Lütkehaus et al have used and extended the GeoPolRisk approach developed by Gemechu et al to evaluate the impacts of raw materials utilized in EVs or traction batteries. Henßler et al in turn have applied the ESSENZ approach developed by Bach et al to assess the impacts of metals and fuels used in plug-in hybrid electric vehicles.…”