Life Cycle Assessment and Cost of Beer Production and Consumption in Canada

Life cycle assessment and cost of beer production and consumption in Canada

Abstract

ALCOHOL holds an important role in social engagement and bonding for many social drinking or moderate alcohol consumption for many is pleasure. It is even believed that it reduces stress and anxiety. BEER, an ancient beverage that has been tantalizing and intoxicating humans throughout our history. On weight basis, it is most produced food commodity. 1.95 billion hectolitre beer were produced globally in 2018 (Conway, 2018). United States is the second largest county which produce beer after China.  Canada ranked 18^th in world beer production (Anon., n.d.). It produced 22.08 million hectolitres in 2018 (Bedford, 2019). The paper consists of life cycle assessment of beer production and consumption in Canada. The analysis is carried out in two phase (i) production and consumption of 1l of beer at home (ii) annual production and consumption of beer in Canada. The system boundary is from cradle to grave.

Life cycle analysis has been done based on ISO 14040 and ISO 14044. The methodology of doing Life cycle costing is associated with the life cycle assessment approach. Primary and secondary data has been obtained from various research papers.

Keywords

Life cycle assessment, Life cycle costing, Beer, Consumption, packaging.

Acknowledgement

I would like to that all the people who have supported me in one or the other way to get this report done.

I would like to thank my professor, Dr. Rajeev Ruparathana, for accepting me as a student. During all the lectured he not only nurtured me with his knowledge but also taught how each lesson would be helpful in our day to day life. He always expected quality of work rather than quantity of work and it has motivated me to be a good environmental engineer and help the mother Earth.

I would like to thank my Graduate assistant, Negin Ziayee Bideh, for her support in class as well as during office hours.

Also, I would like to thank my parents who have supported me mentally and kept motivating me at every step of my academic career.

Last but not the least, I would thank to those who have helped me with technical issue to carry out this study successfully.

Table of content

Abstract……………………………………………………………………………….. 2

Acknowledgement……………………………………………………………………. 3

Introduction…………………………………………………………………………… 5

Methodology…………………………………………………………………………. 6

2.1  Goal and scope

2.2  Data and assumptions

Result and discussion………………………………………………………………. 17

 3.1 Global Warming Potential

 3.2Other environmental impacts

 3.3 Improvement Opportunities

Life Cycle cost……………………………………………………………………… 23

Conclusion…………………………………………………………………………. 24

List of Figures

Figure:1 2018 Millennial Drinking Trends…………………………………………………………………… 5

Figure:2 Processes involved in beer production…………………………………………………………………7

Figure:3 Life cycle of beer………………………………………………………………………………………9

Figure:4 Global warming potential of beer for different type of packaging along with contribution of

               different life cycle stage………………………………………………………………………………18

Figure: 5 Contribution of Raw materials and auxiliaries to GWP……………………………………………. 18

Figure: 6 Environmental impacts of beer for different beer packaging options………………………………. 19

Figure: 7 Contribution of different life cycle stages to the environmental impacts

                of beer in different packaging………………………………………………………………………21

               Glass bottle

               Aluminium cans

               Steel cans

Figure: 8 Life cycle cost of beer from different types of packaging………………………………………… 23

1        Introduction

Beer consumption is increasing globally and recently it has reached 1.95 billion hectolitres in 2018. Czech Republic is the country that has topped the per capita beer consumption table for 23 consecutive years. United states secure 17^th position while Canada 34^th position(Smith, 2019).  As mentioned above Canada produced 22.08 million hectolitres in 2018. Beer was first introduced in 17^th century by a European settler and since then the industry has been growing. In 2016, beer industry roughly accounted $13.6 billion of Canada’s gross domestic product, which is 0.7% of the economy. This industry employs approximately 150,000 people of which 0.8% is Canadian workers (Philip Macneill, 2019).

                              Figure:1 2018 Millennial Drinking Trends

Half of beer produced is consumed on-trade while the other half is consumed off-trade. On-trade outlets consist of bars, restaurants and other entertaining venues while off trade outlets are supermarket, retailer and other off licensed shops. There are many studies and research papers on life cycle impact on environment of beer production in many countries. System boundaries and assumptions are different for each study which lead to different results. For example, according to Talve (Talve, 2001), agricultural production of beer ingredient contributes the maximum. On the other hand, Koroneos (Koroneous, 2003) proposed that bottle production is the majority contributor. Different study with different assumptions, methods and outputs made cross comparisons difficult. Global warming potential is considered in all the studies and the results not only vary in different studies but also in the given study itself. This paper consists of life cycle assessment and life cycle cost in beer supply chain.

2        Methodology

According to ISO 14040, life cycle assessment has done in this report and for methodology ISO 14044 has been considered. Using the approach of Hunkeler (Hunkeler, 2008) and Swarr (Swarr, 2011), LCC has been assessed. The following equation has been followed to calculated the LCC of beer:

LCC_Beer = C_RM + C_RP + C_P + C_T + C_w

Where,

LCC_Beer is Life cycle cost of 1L of beer production

C_RM is the cost of raw material

C_PR is the cost of beer production

C_P is the cost of packaging

C_T is the cost of transportation cost of raw material, packaging, beer to retailer and post- consumer waste.

C_w is the post-consumer waste disposal.

2.1. Goal and scope definition

The goal of the study is to estimate the life cycle environmental impacts and cost of beer production and consumption in Canada. The study consists of the cost and impact at the consumer levels. For this purpose, the functional unit is production and consumption of 1L of beer at home. We will discuss about consumer level. The system boundary for consumer level is from cradle to grave.

               Figure :2 Processes involved in beer production.

The figure shows the processes to produce beer.  The process starts with the collecting raw materials, followed by manufacturing and packaging, distributing and consumption. The last step is waste disposal and treatment. Each process is discussed below.

Raw materials: Collecting raw materials is not an easy task. Barley is the main commodity to produce beer. Barley and hops cultivation, production of barley malt, manufacturing of various chemicals like carbon dioxide, sulphuric acid and other auxiliary material is done in collecting raw materials.

Manufacturing: manufacturing includes grist preparation and milling, carbonation, fermentation, filtration, filling and storage.

Packaging: energy and material input for the manufacture of the glass bottle, aluminium cans and steel cans.

Retail and consumption: refrigerated storage of beer at stores and later on consumption is included in here.

Waste management: this section includes the treatment of the produced during beer production, in-process and post consumption. Steps disposal and recycling are considered here.

Transportation: transportation of raw materials, packaging material, beer and waste.

The following things are excluded from the analysis:

• Consumer’s transportation to retailer. Sometime it is not sure that consumer transport just to buy beer. They can even travel to buy other stuff and along with that they buy beers. Thus, in such a case the transportation cost is not only considered for beer but for other products too.
• Refrigeration of beer at home. For this report it is assumed that the beers are consumed shortly once they are purchased. And if at all they are refrigerated, then the electricity consumed per litre of beer would be small for such a short period of time. Also, there will not be any refrigerant leakage from domestic refrigerators.
• Glasses and other consuming containers from which the consumer drink the beer. The main reason to avoid considering it is that those containers can be used for other purposes too.
• Production for secondary and tertiary packaging for the cans is excluded as they contribute less than 1% to GWP. And it is assumed that its contribution to other impacts will be small too.

                           Figure :3 Life cycle of beer

The above shown figure, is the life cycle of beer considered in one of the studies on life cycle of beer in UK.  We have considered the same life cycle of beer for our study.

2.2. Data and assumptions

Primary production data have been obtained from various papers and few of them from a manufacturer. Primary production includes the raw and auxiliary materials and energy used for production of beer as well as transportation modes, distances and cost along the supply chain. Remaining data have been taken from a review paper which carries data from the CCaLC, Ecoinvent and GaBi databases. Many data have been adapted from a literature review based in UK and considering the same criteria for Canada they are used in this report as well. Cost for the study have been taken from various sources like literature and market analysis. More details about each life cycle stage are provided in the next sections.

2.2.1 Raw materials

The primary ingredients for beer production are barley, hops, water, yeast and carbon dioxide. Other auxiliary materials used for brewing beer are sodium hydroxide, sulphuric acid, phosphoric acid and diatomaceous earth are considered. Life cycle inventory data for barley and hops in Canada is not specific and hence data of UK have been used as a proxy. As mentioned above cost of raw materials have been obtained from various sources and they are discussed in Table 1.

Table 1: Inventory data for raw materials and packaging.

*Includes all components of the can.

2.2.2 Beer production and filling

Beer process starts by soaking and draining barley grains to obtain malted barley. Here the process of germination of seeds takes place. Germination helps enzymes to convert proteins and starch into sugars and amino acids (Palmer, 1999). The grains are dried and kept away for brewing. Malted barley is then crushed and converted to powder called grist. The grist is then added in a large vessel called mash, to which it is mixed by adding hot water. The sugar into the malt mix with water and form liquor to form sweet wort, which is boiled with the hops. After filtration and cooling of wort, it is blended with yeast where yeast metabolises sugar to produce alcohol and carbon dioxide. The time taken for this process vary from couple of days to 10 days depending upon yeast, fermentation parameters and taste needed. Carbon dioxide is added and ten filtration takes place before the process of filling beer bottles and cans. Electricity, steam and compressed air consumed during this whole process is summarized in Table 2.

Table 2: Electricity and other utilities used for beer production and filling.

2.2.3 Packaging

Beer in Canada is mainly sold in three packaging types and sizes: 0.33 l glass bottles and 0.44 l aluminium cans and steel cans. The glass bottles of beers come in multi-pack cardboard crates. It is assumed that the glass bottles contain 85% of recycled glass. Later in this paper, different percentage of recycled glass are considered to examine the effect on environment. Bottle tops are made up of steel. The cans are made up of aluminium and steel and contain 48% and 62% of recycled metal, respectively (Defra, 2009). The study considered that the impact from the virgin materials have been considered and the recycled materials do not harm the environment. The packaging cost do not include the costs of manufacture of the bottles and cans.

2.2.4 Retail Refrigeration

It is assumed that the beer is stored at a circulating condition at the retail stores. Few assumptions are made for refrigeration in this study. They are mentioned below:

• The selected refrigerant is R404 with global warming potential of 3860kg CO₂ eq./kg (IPCC, 2005).
• Refrigerant charge is estimated at 3.5kg/kW (Defra, 2008).
• Annual leakage is assumed at 15% (Defra, 2008).
• Beers are stored in refrigerator for 24 hours before they are sold.
• Cost of electricity is 11.85cents/kWh (Wolfe-wylie, 2012)

Table 3 shows electricity consumption during retail refrigeration. It is estimated by dividing the total consumption of electricity of the refrigerated display unit by the volume of beer. The display cabinet types are is selected as remote condensing unit, vertical and chilled.

Quantity of drinks is estimated by dividing the total volume of beer in the refrigerated display unit by total display area while electricity consumption per litre of beer is calculated by dividing the electricity consumption of the refrigerated display unit by the volume of beer.

Table 3: Electricity consumption during retail refrigeration.

Table 4: Refrigerant leakage during retail refrigeration.

Volume of beer chilled are obtained by assuming 317 l for glass bottle and 480 l for aluminium cans and steel cans in refrigeration unit. Refrigeration loss is obtained by multiplying the annual refrigerant losses (15%) by refrigerant charge (3.5 kg/kW) and the power of the refrigeration unit (2 kW). Refrigerant losses per litre of beer is calculated by dividing the annual refrigerant losses by the total volume of beer cooled annually. GWP per litre of beer is obtained by multiplying the refrigerant losses per litre per day by the GWP of R404A.

2.2.5 Waste management

Including effluents from post-consumer waste packaging and the brewery, all the related waste streams are considered. The effluents from the brewery are treated in a wastewater treatment plant. Landfill cost and waste water treatment cost is assumed taken from a review paper (Amienyo, 2016). Cost of recycling are included in the cost of packaging materials.

Table 5: Waste Management

2.2.6 Transportation

Transportation distance and cost applied to the supply chain are discussed in this section. The transportation cost for the barley has been provided by the manufacturer. As we do not have data for other raw-materials we have considered same as transportation cost. Moreover, all the other raw- materials are assumed to be delivered at the same distance as barley. The distance between brewery and retailer is assumed to be 100kms. The cost analysis for transporting the raw material for packaging to brewery and the beer to the retailer is based on the amount of fuel consumed. Cost of fuel has been assumed to be $1.33 per litre (Press, 2018). Transportation modes and distance has been described in the table 6.

Table 6: Transport modes and distance along the supply chain

3        Results and discussion

In this section we will discuss about the impacts of these phases on 12 categories. Following are the 12 impact categories considered in this report:

Global warming potential (GWP), Abiotic depletion potential (ADP), Eutrophication potential (EP), Acidification potential (AP), Marine Aquatic Ecotoxicity potential (MAETP), Human Toxicity potential (HTP), Freshwater Aquatic Ecotoxicity potential (FAETP), Ozone Depletion potential (ODP), Photochemical oxidants creation potential (POCP), Terrestrial ecotoxicity potential (TETP) (Environment, 2005). As per ISO 14047 all the technical impact categories are provided and out of which 10 are selected. In addition to this impact categories, two other impacts are selected: Primary energy and water demand.

3.1  Global Warming Potential

Global warming potential (GWP) examines greenhouse gas ability to trap heat into the atmosphere as compared to Carbon Dioxide over a specific horizon time (Canada, 2019).

Figure 3 shows the GWP of beer from different stage. 1l of beer in glass bottle is estimated at 842g CO₂ equivalent. Compared to that the GWP from aluminium cans and steel cans is lower, 575 and 510 respectively. Highest GWP is from the packaging stage. This mainly because of carbon dioxide emission from the production of packaging materials. Minimum contribution is from transportation phase. Raw material and other auxiliaries for manufacturing process contributes equally for all three types of packaging. This is mainly because of nitrous oxide from barley cultivation. Similar to raw materials phase, GWP contributes almost equally in beer production phase.

Figure: 4 Global warming potential of beer for different type of packaging along with contribution of different life cycle stage

The share of different raw material contributing to GWP is shown in Figure:4. Malted barley is the main contributor with 57% while sulphuric acid contributed the least. Second largest contributor is Liquified carbon dioxide which adds 11%. It is mainly because of energy consumed purification and liquefication. The release of CO₂ from beer is a complex issue as it depends upon many factors. Light fuel oil and Liquid carbon dioxide are almost equal. The difference between then is just 1%.

Figure: 5 Contribution of Raw materials and auxiliaries to GWP

3.2  Other environmental impacts

The impact of secondary and tertiary packaging is not assessed for aluminium cans and steel cans. Hence, to compare the impacts of beers in different packaging at equal stages, the impact of the beer in glass bottle are shown in two ways: with and without the secondary packaging.

        Figure: 6 Environmental impacts of beer for different beer packaging options.

Looking at the Figure 5, Glass bottle with secondary packaging more in 5 impacts compared to other type of packaging. Beer packed in the steel can has the lowest impacts i.e., 5 out of 12. Aluminium can is the best option for WD, ODP and POCP but it is not good for MAETP, HTP and GWP. HTP is mainly because polyaromatic hydrocarbons from manufacturing of aluminium cans and MAETP is because of hydrogen fluoride emissions. Glass bottle is good for HTP but scores highest in other 8 impacts. There is a little difference in water demand between both the packaging options. The reason behind it is that maximum amount of water is used for beer production rather than packaging. Raw materials and packaging are the main and almost similar hotspots for the beers. Contribution to each life cycle stage is shown in Figure 6(a-c) for glass bottles, aluminium cans and steel cans.

Packaging of glass bottles affects mainly to MAETP and POCP while it is negligible for water demand and eutrophication. The only impact in bottle packaging for water demand is for beer production. The minimum effect is on Eutrophication. Packaging contributes maximum and in every impact. Transportation and waste management contributed equally and they are minimum as compared to raw materials and packaging.

For aluminium cans packaging is maximum for human toxicity and marine aquatic ecotoxicity. Raw materials contribute maximum in Eutrophication and terrestrial ecotoxicity. Transportation affects the least in aluminium can, followed by waste management.

Throughout the report aluminium and steel cans have same amount of raw materials used and are assumed to deliver at the same distance. Also, fuel consumption used for transportation of raw material and finished good is also equal, the contribution to environmental impacts are way different. Raw materials and packaging follow almost the same trend as aluminium cans but beer production creates POCP the most. It is because of the nitrogen oxide and sulphur dioxide emission due to electricity during steel production.

Overall, from the three figures, it can be seen that for steel can raw material phase affect the maximum but for glass bottle both raw materials and packaging affects equally. 

  Figure: 7 Contribution of different life cycle stages to the environmental impacts of beer in different packaging

3.3  Improvement opportunities

The main hotspots in life cycle of beer are raw materials and packaging and hence they should be targeted to reduce the impact on environment in the supply chain. There are many ways and technologies to improve the efficiency of the barley production. Using more amount of renewable energy as well as changing position of fossil fuel in barley drying process can help. Reusing glass bottles is a good option. There already a way in Canada by which the government encourage people to return empty glass bottles. People get paid for returning empty glass bottles. Only very small number of people follow this practice, students or road-siders. The reduction in impact depends on number of bottles returned and the number of times the bottle can be reused. For example, 45% reuse and up to 7 reuse cycles, the impacts for most categories of this report reduces excepts eutrophication and ozone layer depletion. Thus, we can consider two options: increased recycled glass content and light weighting of bottles.

• Recycled glass content

Increasing recycling content in glass bottle is a good initiative for improving the environmental sustainability. To examine the effectiveness of glass recycling on environmental impact, a huge range of 0%-100% is considered. With every increase in specific amount of recyclable material there is specific amount of decrease in GWP. This is because of lower energy used to manufacture glass bottle and reduced amount of waste send to landfills. On the other side, if no glass was recycled, the GWP would approximately 20% more compared to the present scenario.

• Bottle light-weighted

Along with increasing recycled glass content the government should try to decrease the weight of the glass bottles. Reducing the weight of glass bottles by 10% helps to save GWP by 5%. Similarly, it can be carried out of other impacts too.

4        Life Cycle Costs

  Figure: 8 Life cycle cost of beer from different types of packaging.

From figure 7, it can be said that the total Life cycle cost of glass bottles and aluminium cans are almost same. There is a difference of 0.25 pence/ litre which is equal to 0.40 CAD/litre. Raw materials cost is equal for all three. Aluminium cans are expensive to make but glass bottles costs more in filling and waste management. Steel cans cost is way lesser than the other two. Beer in retail is approximately $1.60 to $4.75 per litre depending upon brand and type.

Canned beers are cheaper as compared to bottle one’s because of two reasons: consumer’s perception and beer quality. The retail price also includes 13% GST charge on the top of retail price. This result is mainly used for reference purpose as most of the data are used from various research papers. They do not reflect the accurate cost. The main contributor to LCC are raw materials, approximately 63% for bottled and aluminium cans and 72% steel cans to the total. This is because the main ingredients for beer production is barely, hops, water and light oil. Second largest LCC contributor is packaging. The remaining cost are due to waste management, beer production and lastly by transportation.

5        Conclusion

This report presents the Life cycle analysis and life cycle cost of beer production and consumption. It has been estimated that the main hotspots of beer production and consumption are raw materials and packaging. It has been estimated that 1 l of beer in glass bottle generated 842 g of CO₂ equivalent emission. Similarly, by comparing for steel and aluminium cans it is 510 g and 574 g respectively. By the method of extrapolation and applying this result at the national level, GWP generated will be 2.16 million tonnes of CO₂ equivalent.

The life cycle cost of beer in steel is less as compared to beer in glass bottle and aluminium cans. The LCC of beer in bottle and aluminium cans are almost same. Extrapolating the values from LCC table, the life cycle cost will be $882 million per year or 4.6% of the total beer market value.

From the finding, it can be said that by increasing the recycling materials and reducing the weight of the beer bottle will help in environmental progress.

Reduction in beer consumption should also be taken care of. If consumption will decrease, production will also decrease and along with that the environmental impacts due to beer production will also decrease.

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