Accounting for Durability in Least Life Cycle Cost Methods
Jessika Luth Richter
Robert Van Buskirk
Summary, in English
In the European Union (EU), mandatory durability ecodesign requirements have recently been set for vacuum cleaners and lighting products. Durability standards for additional product groups are expected in the future and it is also envisioned that durability issues will be integrated in the EU energy labelling scheme. Durability standards can bring environmental benefits, but there are several methodological challenges, not least regarding the trade-offs between different product attributes. In this paper, we review previous literature and studies examining durability and increased lifetimes for products, with a focus on the case of LEDs. We analyse the methods suggested and assumptions used and compare these to an innovative method for calculating an attribute-adjusted least life cycle cost (LLCC) when durability is included. Then we analyse the case of LEDs available in an online market in 2016 and model optimal lifetimes in relation to life cycle costs. The model identifies factors influencing optimal lifetimes. The statistical error of the regressions does not allow for calculation of the optima with precision, but the calculation is illustrative that the LLCC optima for the range of LED bulbs considered is close to 25000 hours. The model also indicates that greater durability is important for cases with smaller discount rates and more intensive use of the product. We discuss the usefulness of the method and its application and development in context of policy development of durability standards, as well as future research that can complement this approach. The initial results indicate that, at least from an LLCC perspective, longer lifetimes than currently required by standards may be desirable, so we also discuss the advantages and disadvantages of using three different policy instruments to stimulate increased durability.