Product Environmental Footprint (PEF): Revolutionising LCA for Better Sustainability
Europe has been a leader in implementing a range of initiatives as part of its 2019 EU Green Deal, aimed at reducing emissions by 50% by 2030 and achieving net zero by 2050. Central to this strategy is the “life cycle assessment (LCA) methodology”, a tool designed to evaluate the environmental impacts of products, sectors, and projects throughout their entire value chain, from raw material extraction to disposal (cradle-to-grave). LCA helps pinpoint key areas for reducing carbon emissions. Existing LCA methodologies were overly broad, often resulting in LCA studies with conflicting results based on the different goals or methodological choices of individual studies. In response, the EU Commission developed the PEF method, a more specific set of guidelines to calculate an LCA. These guidelines are supported by Product Environmental Footprint Category Rules (PEFCRs), which provide specific rules for different product categories within each industry.
PEF Methodology in textiles and apparel
More than 15 LCA such as TRACI, CML, EDIP, etc, have been identified that are used for impact assessments. However, it was found that numerous such methodologies focus on a single issue such as carbon footprint or multiple issues. Each of these methodologies has a set of indicators, which differ according to the measurement approach or the model of the environmental mechanism. Even the methods under these methodologies undergo significant improvements over time. As a result, a substantial number of methods are in use. Some of these methods measure environmental impacts at the end of the environmental mechanism whereas others do at the midpoint level. There was a lack of a single comprehensive mechanism that targeted many indicators and streamlined the comparison of environmental impacts of the products inter- and intra-industry.
Thus, the European Commission came up with a Product Environmental Footprint (PEF) which is a “life cycle assessment methodology” providing a standardised approach to measuring the environmental impact of products across the European Union. It uses Life Cycle Assessment (LCA) principles to assess all stages of a product’s life cycle, from raw material extraction through production, transport, sale, use (accounting for the product’s durability), and end-of-life disposal. This harmonised approach establishes a common language for LCAs across Europe, ensuring consistency and enabling comparability of products' environmental footprints across countries and industries. PEF differs from a classic LCA in terms of specific requirements on background data to be used and has a central database to minimise differences that may occur due to modeling decisions. PEF also mandates a common set of impact categories and weighting factors to ensure consistency in results. Each product’s PEFCR takes this further and defines mandatory product information to be collected and used, enabling scalability and meaningful and comparable product footprint results.
By comparing their products to competitors’ offerings or the broader market, companies can make voluntary green claims to other businesses or consumers. These green claims are backed by scientific assessments under PEF making them transparent and reliable and reducing the chances of greenwashing by the companies. This methodology has also reduced the cost of SMEs developing an LCA. Companies can identify their hotspots and improvement areas, ultimately helping reduce their products’ environmental footprints. It can also serve as a communication tool within the supply chain, encouraging suppliers to reduce their environmental impacts.
Further, the PEF covers 16 environmental indicators related to climate change, ecosystems, and human health, delivering a comprehensive assessment. This reliable data empowers consumers to make environmentally responsible purchasing decisions.
PEFCRs in textiles and apparel
The PEF method is supported by a set of guidelines known as Product Environmental Footprint Category Rules (PEFCRs). Prior to the introduction of PEFCRs, similar rules existed but lacked the necessary specificity to ensure uniform assumptions, measurements, and calculations, which are critical for comparing environmental claims across products serving the same function. After extensive discussions, PEFCRs are now being developed for each industry to improve the reproducibility, relevance, and consistency of PEF studies.
PEFCR provides detailed instructions for conducting PEF studies, outlining mandatory procedures for industries like textiles. The apparel and footwear (A&F) PEFCRs are being designed in response to fast fashion, dealing with the issue of over-consumption. Policymakers are developing a holistic method to calculate how many times a product will be worn on average, considering both emotional and physical durability. This has been defined as a functional unit (FU) which means - to provide a product to meet the consumer’s needs in good condition for one day of wear. A&F PEFCR uses one day of wear as FU instead of one garment or one kg of garment. By choosing this unit, the A&F PEFCR recognises the environmental benefits of longer-lasting products as the impact of a garment is spread across the number of wears. The total environmental impact will be expressed in this functional unit.
This FU will be determined across the textiles and apparel industry for which PEFCR is being prepared. The following products are approved for A&F under PEFCR among which a representative product will be defined by the technical secretariat, using industry data and/or primary data from TS members. A representative product in textiles will be the product(s) that represent the ‘market average’. The average environmental impacts of this product will help in benchmarking for the product group against which the performance of other products will be measured.
Apparel & Footwear Products under PEFCR
Item
Product
HSN Code
T-Shirts
6109
Shirts & Blouses
6105, 6106 & 2 others
Sweaters & Midlayers
6110, 6105 & 1 other
Jackets & Coats
6101, 6102 & 2 others
Pants & Shorts
6103, 6203
Underwear
6107, 6108
Dresses, Skirts & Jumpsuits
6104, 6204
Swimwear
6112, 6211
Apparel Accessories
6116, 6117 & 12 others
Open-toed Shoes
6401, 6402 & 3 others
Close-toed Shoes
6401, 6402 & 3 others
Boots
6402, 6403
Leggings, Stockings & Tights
6115
Scope of PEFCR in textiles
The performance of above-mentioned products will be assessed on 16 environmental impact categories, generally related to the depletion of scarce resources, or emissions of environmentally damaging substances (e.g., greenhouse gases and toxic chemicals), however not limited to these. These categories are comprehensive in terms of not only focusing on climate change and related factors but also on human health, ecosystems, and natural resources, moving away from carbon tunnel vision.
Each of the products will have an individual score in each of the above-mentioned categories. These impact categories will be assigned weights and then an individual score of the product will be calculated. A lower PEF means that a product’s environmental footprint is low while a higher PEF means that a product cause more damage to the environment.
The score will be benchmarked against the score of a representative product and further will assign a performance score from A to E or A to F relative to the benchmark value, and whether the ‘defaulted score’ for a product matching benchmark value is a C or an F.
A snapshot of PEF Score on Greenstitch platform is shown below:
However, the PEFCR methodology is not a comprehensive tool for evaluating a product's overall environmental and social sustainability. It excludes several critical factors: such as socio-economic factors such as child labor, modern slavery, and the livelihoods of farmers in developing countries; microplastics and biodiversity impacts in detail. This shows while PEFCR offers valuable insights into environmental performance, it does not provide a complete view of a product's sustainability, especially regarding social factors, microplastic pollution, and biodiversity. However, companies are also encouraged to additional information regarding wider sustainability impacts; for the A&F PEFCR, a non-exhaustive list including plastic leakage (microplastics) and biodiversity impacts has been suggested. Currently, the PEF is in the transition phase and is scheduled to finish in the current quarter of 2024. The scheme is expected to adopt PEFCRs in 2025.
Data requirements with PEFCR
To calculate the PEF score under this methodology, companies need to gather a variety of datasets. Primarily, this includes collecting primary data, which consists of company-specific information provided directly by the company or indirectly through suppliers (e.g., product-specific and supply chain-specific data). The PEF methodology requires companies to adhere to the ‘materiality principle’ when using primary data. This means they should focus on aspects most relevant to the environmental performance of a given product, while secondary data can be used for less significant parameters. PEFCRs determine which aspects are most important, specifying the minimum set of processes (known as mandatory processes) that must always be covered with company-specific data, including the following:
- Raw material production: This includes details on product composition, material types, and quantities per unit (including trims and their origin), transportation modes used for each material, the mass transported, and distance covered per transport mode (including return trips with empty loads).
- Manufacturing: Data on processes and technologies used (e.g., spinning, weaving, dye cutting, sewing, assembly), the specific locations of these processes, and loss rates during production.
- Distribution: Information on the final product’s weight, deadstock rates, and how deadstock is managed.
- Use stage: Identifying garments requiring special care like dry cleaning, as well as conducting durability tests and assessing the availability of repair services.
Given the granular nature of these data requirements, it can be challenging for companies to obtain each data point for every product. To address this, default values from secondary sources can be used to fill data gaps. Companies undertaking PEF studies must utilise the ‘EF-compliant LCA database’—in the case of the A&F PEFCR, this will be the EF 3.1 database—compiled by the European Commission to ensure standardisation. This database is composed of various individual databases, a mix of commercial (e.g., EcoInvent) and publicly available data (e.g., PEFCR representative products).
The initial challenge that a company faces is uncertainty in the data points to be collected and the level of quality it needs to have. The data points to be collected depend on the influence a company has on the product. The company has to map the influence by determining if the process on which PEF is to be conducted falls in the ‘most relevant category’ or not. The most relevant impact categories shall be identified as all impact categories that cumulatively contribute to at least 80% of the total environmental impact. Similarly, companies are required to identify the most relevant life cycle stages, processes, and elementary flows in their supply chain. If some of the activities controlled by the company have too little to no impact on the environment, then there is no need to collect primary data but it is important to have primary data to identify environmental hotspots.
For data collected on each of the identified most relevant processes, and life cycle stages, a data quality ratings (DQR) score is to be calculated. According to textiles PEFCR, the score will be a combined score of 4 parameters - Precision/Uncertainty (P), Technological Representativeness (TeR), geographical representativeness (GR) and Time Representativeness (TiR). The total data quality score of a dataset is the average of the scores of all four data quality criteria. This score will also be assigned to the secondary database (provided in PEFCR) that is being used when primary data is not available. These scores must meet certain minimum thresholds for the PEF study to be valid (as verified by the external examiner).
Given the complexity not only in the data collection, but also assuring the data quality requirements under PEF makes it difficult for companies to conduct PEF study on their own, thus, they require a specialised software that has in-built automation that can calculate these scores in seconds after initial feeding of the data and produce the desired results in a compatible manner.
How Greenstitch can assist?
Due to rigorous data requirements under PEF, it would be taxing for companies, especially small companies to manage large amounts of granular data and simultaneously monitor its quality. The standardised quality checks of the data by the third party also make it compelling for companies to maintain a high-quality database. Thus, they require expertise from a third-party “sustainability platform” that is proficient in “carbon accounting”, life cycle analysis and ESG reporting. One such platform is Greenstitch, which is specially designed for textile and apparel companies. This custom-made, easy-to-use, state-of-the-art software is user-friendly and requires less contact with the support staff of Greenstitch.
PEF will revolutionise the conventional LCA studies and places a higher data requirement on companies, especially for SMEs. Thus, Greenstitch with its automated software has tried to reduce the data analysis and reporting hassle while providing solutions for traceability and supply chain decarbonisation. This AI software helps companies better understand their "supply chain environmental impact" and move towards sustainability.