This study is a comparative life cycle assessment of two competing DVD rental networks: e-commerce option, where the customer orders the movies online, and the traditional option, where the customer personally goes to the rental store to rent a movie. The analytical framework proposed is applied to considering a customer living in the city of Ann Arbor, Michigan (U.S). The primary energy and environmental performance (criteria air pollutants, greenhouse gas emissions) for both the rental networks are presented in the form of a multi-criteria LCA. In contrast to other studies presented, which found that impacts are highly sensitive to the transportation phase, differences in the performance of the two alternatives considered are due to the selection of the package used to deliver the DVDs. The package selected by the traditional business accounts for 67% of the difference in total energy consumption of the two alternatives. Results show that the e-commerce alternative consumed 33% less energy and emitted 40% less CO2 than the traditional option. A set of sensitivity analyses performed, test the influence of distances traveled and transportation modes, DVD and DVD packaging reuse on the final results. The mode of transportation used by the customer in the traditional business model also affects global emissions and energy consumption. A maximum of 12% reduction in primary energy is possible in the traditional network when the customer decides to walk to the store; however, the e-commerce option performed comparatively better despite all transportation modes tested. A novel economic indicator (ESAL) is used to compare different transportation modes based on the level of stress exerted on the pavement. The two networks are also compared based on full cost accounting. Consistent with its energy and environmental advantages, the e-commerce network exerts $1.17 lesser economic impact than the traditional network for the functional unit tested.
CSS Publication Number:
full cost accounting
June 17, 2007
Sivaraman, Deepak, Sergio Pacca, Kimberly Mueller, and Jessica Lin. “Comparative Energy, Environmental and Economics Analysis of Traditional and Ecommerce DVD Rental Networks.” Book of Abstracts of the 2007 ISIE Conference. Toronto, Canada, June 17-20, 2007: 172.