Toward More Realistic Estimates of Product Displacement in Life Cycle Assessment

Life-cycle assessment (LCA) is one of the most widely applied methods for sustainability assessment. A main application of LCA is to compare alternative products to identify and promote those that are more environmentally friendly. Such comparative LCA studies often rest on, explicitly or implicitly, an idealized assumption, namely, 1:1 displacement between functionally equivalent products. However, product displacement in the real world is much more complicated, affected by various factors such as the rebound effect and policy schemes. Here, we quantitatively review studies that have considered these aspects to evaluate the magnitude and distribution of realistic displacement estimates across several major product categories (biofuels, electricity, electric vehicles, and recycled products). Results show that displacement ratios concentrate around 40-60%, suggesting considerable overestimation of the benefits of alternative products if the 1:1 displacement assumption was used. Overall, there have been a small number of modeling studies on realistic product displacement and their scopes were limited. Additional research is needed to cover more product categories and geographies and improve the modeling of market and policy complexities. As such research accumulates, their displacement estimates can form a database that can be drawn upon by comparative LCA studies to more accurately determine the environmental impacts of alternative products.