Quantifying Circularity Using Life Cycle Assessment (LCA) Applying Circularity Indicators for the Manufacturing Industry: A Case Study of Industrial Process Equipment

As more companies adopt circular economy (CE) principles, understanding the environmental impact of materials is becoming crucial not only as a matter of corporate responsibility, but for reducing emissions, conserving resources, and meeting regulations. Steel a fundamental material used in manufacturing, is also one of the most carbon-intensive ones, emits an average of 1.92 tonnes of CO₂ per tonne produced, and contributes to approximately 7–9% of global carbon emissions. Although recycled (secondary) steel provides a more sustainable alternative, there is limited life cycle data comparing primary and secondary steel. This data gap prevents companies ability to fully understanding their environmental impact and making informed decisions regarding their sustainability and circularity goals.
This thesis addresses this gap by applying life cycle assessment (LCA) to quantify mandatory resource flow circularity indicators defined in the new ISO 59020 circularity standard. It also examines how these indicators align with the Corporate Sustainability Reporting Directive (CSRD) European Sustainability Reporting Standards (ESRS), especially within the ESRS E5 “Resource Use and Circular Economy” category.
A novel LCA-based method was developed and applied to a case study of industrial process equipment using SimaPro 9.6 software and Ecoinvent 3.10 database. The method compared the environmental impacts from raw material extraction to end-of-life using recycled steel in the manufacturing phase to evaluate environmental and circularity performance of new and previous product models. Circularity indicators were quantified through scenario modeling (inflow recycled content), end-of-life modeling (outflow recycled content), and defined functional units and industry benchmarks (product lifetime comparison).
Environmental impacts were assessed using the Environmental Footprint 3.1 method, and Product Environmental Footprint Category Rules (PEFCR) for steel products. Results showed that most impacts occurred during the use phase, mainly due to the electricity consumption of the motor. Using recycled steel reduced the climate change and resource use impacts by 1–11%, but the benefit was limited due to the dominance of use phase impacts. In circular scenarios, the new model had 75% recycled content in its inflows (vs. 60% in the previous model) and 80% in outflows (vs. 74%), regardless of the steel type. However, the product’s lifetime was 0.83 times shorter than the industry average.
In conclusion, LCA could quantify circularity using ISO 59020 circularity indicators at the product level and support compliance with CSRD ESRS E5 effectively. These indicators are related to CSRD ESRS E5 and support companies in meeting both regulatory and sustainability goals. While recycled steel offers environmental benefits the during manufacturing phase, transitioning to renewable electricity is crucial to improve the overall performance of the product. However, further data is needed to expand the method to other indicators and system levels.