Page 99 - Finanancial Management_2022

among businesses in the value chain. This Scenario 1
is further complicated by the level of
dependency on developments in Mining Component Vehicle Logistics Vehicle Disposal
connected systems, including charging manufacture manufacture use
infrastructure and battery Environmental
remanufacturing. impact
Our research involved representatives Industrial
across the EV life cycle from raw material health and
extractors to EV fleet operators. We safety
realised that a major challenge to the Air pollution
development of a sustainable battery was Carbon
the difficulty connecting the different emissions
information systems operating in different Water pollution
businesses across the world in places as far Forced/child
afield as the Central African Republic, labour
China, Indonesia, and Chile.
From a sustainability perspective, a
major concern relates to the possibility of a different scenarios are compared. chain is by driving the EV instead of an
“solution” shifting the problem around the We have simplified the model to internal combustion engine. Therefore,
value chain or swapping one negative demonstrate the underlying concepts and the more miles a battery can deliver,
impact for another. For example, an EV ideas without getting lost in the details. the better its overall impact as it increases
driving around Norway will reduce Also, instead of numbers, we have used a the possibility of paying back for any
Norwegian air pollution and carbon modified traffic light system where red damage done.
emissions. But to enable that EV to drive represents a negative impact (the deeper
one kilometre could create massive the red the more severe the impact) and Scenario 2: Second life
environmental impacts, industrial green represents a positive impact. Grey Nana Bonsu, Ph.D., a researcher on our
injuries, water pollution, and carbon cells represent nonmaterial relationships team, identified second-life applications
emissions in developing countries. or impacts. for EV batteries for storing energy
This is because EV batteries require Reading the model on a row-by-row generated from renewable energy sources
cobalt, manganese, nickel, copper, and basis allows us to estimate a range of such as wind or solar, particularly in
lithium, with their associated risks of paybacks — on carbon, health and safety, developing countries. In this scenario, the
irresponsible mining, production, environment, air pollution, and water. battery is repurposed for domestic solar
processing, and component manufacture. However, it is difficult to conceive any energy systems in developing countries
Even if the environmental net effect across circumstances where modern slavery after it is no longer useful for EVs. (See the
the value chain is positive, this could practices could ever be justified or “Scenario 2” graphic.)
unintentionally be at the cost of rising considered to pay back. In this second scenario, there are two
social inequality or human rights abuse. opportunities for payback. While the
That is why we need to use “whole life Scenario 1: Take-make-use (a second life extends the active use of the
costing” evaluations across different battery is made from virgin battery by decades, the battery is still
dimensions of sustainability, using materials and disposed of in a suitable for further reconditioning or
different scenarios. landfill when it is no longer useful recycling, thus reducing any
but still has 80% efficiency left) environmental risks of disposal. As the
Evaluating circular value chains In this scenario, the only opportunity battery replaces power generated from
To do this we developed a model suitable to offset negative impacts in the value burning kerosene or wood, it enables a
for evaluating circular solutions that could
be used to map critical sustainability
impacts of different end-of-life scenarios Scenario 2
for batteries. This model looks to evaluate
whether the benefits over the life of the Mining Component Vehicle Logistics Vehicle use Delivery Second life Disposal
manufacture
product are greater than the costs of its
production. It is effectively an application Environmental
impact
of payback (the time it takes to repay an Industrial
initial investment) to profile the life cycle health and
impacts using different production, use, safety
and reuse scenarios. In the “Scenario 1” Air pollution
graphic, the columns relate to the standard Carbon
emissions
life cycle categories used in strategic Water pollution
management accounting, and the rows Forced/child
relate to the criteria against which labour

22 I FM MAGAZINE I June 2022