Glossary and definitions
In this glossary we define the technical terms used throughout this webpage and in consequential LCA in general.
Activity: Making or doing something. Activities include human activities (production, consumption, and market activities, as well as accumulation of stocks) and environmental mechanisms, irrespective of their economic significance.
Allocation: In the context of LCA often used as jargon for co-product allocation (see this).
Attributional: A system modelling approach in which inputs and outputs are attributed to the functional unit of a product system by linking and/or partitioning the unit processes of the system according to a normative rule.
By-product (dependent product): Product output from a unit process that is not a determining product.
By-product technology model: See system expansion
Co-product: Any of two or more product outputs coming from the same unit process or product system (ISO 14040, clause 3.10). Co-products may be determining products or by-products (dependent products).
Co-product allocation: Partitioning the input or output flows of a process or a product system between the product system under study and one or more other product systems. The partitioning results are as many partitioned systems as there are co-products in the original system. The sum of the partitioned systems equals the system before the partitioning.
Combined production: A production, where the relative amounts of co-products can be varied independently.
Consequential: A system modelling approach in which activities in a product system are linked so that activities are included in the product system to the extent that they are expected to change as a consequence of a change in demand for the functional unit.
Constrained activity: Human activity that is limited in its ability to change its production volume in response to a change in demand for its product output.
Constrained market:: A market that is limited in its ability to provide the goods or services demanded.
Consumption mix: The output of a market activity.
Cross-price elasticity of demand: The change in demand for a product in response to a change in price for another product.
Demand: The costumer request for a product, reflecting a willingness to pay. The price of a market commodity is determined by the volume that can be produced at a marginal cost that equals the marginal demand.
Dependent product: See by-product (dependent product)
Determining product: Product output of an activity for which a change in demand will affect the production volume of the activity. Also sometimes called a reference product.
Determining property: A property of a product for which a difference in performance causes a change in production output.
Displaced treatment: A treatment that is reduced, replaced or substituted as a result of a change in supply or demand for the material for treatment.
Downstream (in the life cycle): Forward in the life cycle, towards the use and disposal of the product(s).
Environment: The surroundings in which an organisation operates. Can be sub-divided into the natural, social and economic environment.
Environmental exchanges: Environmental exchanges are environmental inputs to a product system (resources), environmental outputs from a product system (emissions to air, water and soil) as well as environmental relations of a product system, which are not directly connected to its inputs and outputs (e.g. land use, physical impacts, non-chemical aspects of occupational health, welfare of workers and domestic animals).
Environmental impact: A change to the environment, whether adverse or beneficial, resulting from an organisation’s activities or products.
Exchange: Causal, directional relationship between two activities.
Functional unit: A quantified description of the performance of a product system, in terms of the obligatory product properties required by the market on which the product is traded.
Goods: Tangible products of an activity.
Human activity: Activity performed by humans, machines, or animals in human care. Can be classified in production activities, consumption activities, market activities, and accumulation of stocks). See also unit process.
Input/output analysis (IOA): Analysis of the product relationships (product inputs and outputs) between all activities of an economy, usually recorded in monetary units.
Input/output tables: An input-output table presents the supply (production) and the use (consumption) of goods and services (products) between all activities of an economy and the primary factors involved in that production, in a tabular format.
Joint production: A production, where the relative amounts of co-products cannot be varied independently (i.e. proportions are fixed).
Life cycle assessment (LCA): Compilation and evaluation of the inputs, outputs and the potential environmental impacts of a product (system) throughout its life cycle.
Life cycle inventory analysis (LCI): Phase of life cycle assessment involving the compilation and quantification of exchanges for a product throughout its life cycle.
Marginal consumer: The consumer that is least willing to pay the market price in a typical supply and demand equilibrium. This means that the marginal consumer is the consumer that stops purchasing if prices go up and increases purchasing when prices go down.
Marginal costs: The change in total costs resulting from a one unit change in output, i.e. the cost of producing an additional unit of a product.
Marginal production: See marginal supplier (long-term)
Marginal supplier (long-term): A supplier/producer that will change production capacity in response to a change in demand for a product (increase or decrease).
Market activity: A human activity representing a market for a specific product, mixing similar intermediate outputs from the supplying transforming activities and providing the resulting consumption mix to the transforming activities that consume this product as an input.
Market boundary: The spatial and temporal delimitation of a market, within which the price of a product is uniformly determined.
Market clearing price: A market clearing price is the price of a good or service at which quantity supplied is equal to the quantity demanded, also called the equilibrium price.
Market niche: A market niche is a smaller sub-category of a market segment, where a part of the customers consider only niche products substitutable.
Market segment: A market segment is defined in terms of clearly distinct requirements for obligatory product properties with a minimum of overlap to other segments. All products targeted for a segment are considered substitutable by the customers of this segment. Furthermore there should be low probability that a product targeted for another segment would be considered substitutable, implying that product substitution from segment to segment can be neglected.
Market-irrelevant product property: A market-irrelevant product property is a property that does not affect customer preferences and therefore does not affect product substitutability, but may influence the reference flow.
Material for treatment: By-product/waste that no other activity in the same geographical area has as its positive determining product, and which therefore cannot substitute a determining product as an input to an activity.
Near wastes: A recyclable material for treatment that is not fully utilised by recycling. When there is not enough demand an additional (marginal) supply of the material for treatment for recycling the rest will go to disposal (waste treatment).
Normalised market trend: Applied to a joint production, the trend for the market on which each joint product is sold, divided by (normalised to) the ratio of the joint product output relative to the output of all joint products from the joint production.
Obligatory product property: A property that a product must have in order to be considered by the customer as a relevant object for product substitution.
Positioning product property: A product property which is considered “nice to have” by the customer and which therefore positions the product more favourably with the customer relative to other products with the same obligatory product properties.
Price elasticity: The percentage change in quantity of supply or demand in response to a percentage change in price.
Product: Activity output with a positive either market or non-market value. Sub-divided in goods (tangible products) and services (intangible products).
Product life cycle: The production, use and final disposal of a product.
Product substitution: A replacement of one product or group of products with another product or group of products.
Product system: System of consecutive and interlinked unit processes, which models a product life cycle.
Rebound effect: The derived changes in production and consumption when the implementation of a decision liberates or binds a scarce production or consumption factor.
Recycling: A treatment activity with a by-product output that can displace determining products from other activities, thus reducing the demand for new (virgin) production of these determining products.
Reference flow: A reference flow is a quantified amount of product(s), including product parts, necessary for a specific product system to deliver the performance described by the functional unit.
Reference product: See determining product
Revenue: The income from the sale of a product output (Revenue = price * amount)
Services: Products without mass, i.e. intangible products as opposed to goods.
Speciality production: An activity that requires a material for treatment as an input, but which is not a dedicated treatment activity (i.e. it has a positive determining product).
Substitution method: See system expansion
Supply: The quantity of a product which is provided by the manufacturers at a given price, and which is thus available to the customers.
System boundaries: The denominations of which entities are inside the system and which are outside.
System expansion: A procedure for eliminating by-products as activity outputs by including them instead as negative inputs, thereby including the additional functions related to the by-products and modelling the resulting changes (substitutions) in the product system, especially by including the reduction in supply of the same product from the marginal supplier to the market for the by-product.
Transforming activity: An activity that transforms inputs, so that the intermediate output of the activity is different from the intermediate inputs, as opposed to a market activity or accumulation of stock. Includes extraction, production, transport, consumption, and waste treatment and recycling activities.
Treatment activity: Transforming activity with a determining product with a negative sign, which means that the activity is supplying treatment or disposal of the determining product.
Treatment markets: Treatment markets are a specific kind of market activities that provide the services of treating or disposing of the wastes and by-products of other activities. The treatment markets operate on the negative determining products.
Unit process: The smallest human activity considered in a life cycle inventory analysis.
Upstream (in the life cycle): Backwards in the life cycle, towards the raw material extraction and production of the product(s).
Waste: There are many different definitions of waste, some of which have legal implications. In a neutral physical modelling, it is therefore preferable not to make a distinction between waste and by-products (see this). However, the definition of a product implies that an output of a human activity that has zero or negative market or non-market value (utility) is NOT a product and would therefore have to be classified as waste.