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As the United States begins to move towards putting an economic value on reducing greenhouse gas (GHG) emissions, the need for improved accounting standards becomes acute. Lifecycle analysis (LCA), which involves the systematic collection and interpretation of material flow in all relevant processes of a product, has become the accepted procedure to use to determine greenhouse gas emissions of products ranging from transportation fuels, to building materials, to food production (Farrell et al., 2006; Hill et al., 2006; Owen, 2004). The basic motivation of LCA is that, to conduct a fair assessment of the environmental impacts of a product, it is necessary to take into account all of the processes throughout the product’s lifespan, including the extraction of raw material, the manufacturing processes that convert raw material into the product, and the utilization and disposal of the product. For many products, including fossil fuels, a standard LCA is generally all that is needed to understand greenhouse gas emission implications. Accounting procedures for biological-based products, however, require additional considerations. Consider a country that expands production of an agricultural feedstock to produce biofuels. To understand how such an endeavor affects GHG emissions requires analysis of the greenhouse gas contents of all the inputs used to produce the feedstock as well as the inputs used to create the fuel from the feedstock. This is as far as most LCAs go. But expanded production of the feedstock does not just magically happen. Either current uses of the feedstock must be reduced to free up supply for production of biofuels, or additional production must occur. If current uses are reduced, then the greenhouse gas emissions associated with the current use should be credited towards the biofuels because they are no longer being emitted. However, if an alternative product is used as a substitute for the current use of the feedstock then the GHG implications of increased production of the substitute should also be counted as a debit. If current use is maintained, then the implications of expanded production of the feedstock need to be accounted for, including changes in crop acreage, production practices, and whether new land is brought into production. And lastly, if changes in land use in the biofuels-expanding region result in changed land-use decisions in other regions, then the GHG implications in these regions may have to be accounted for, depending on the definition of system boundary in an analysis. The need for accounting systems that take into account changes in production systems has been recognized (Delucchi, 2004; Feehan and Peterson, 2004). In a recent report, the Clean Air Task Force noted that “current lifecycle analyses do not account for greenhouse gas emissions and other global warming impacts that may be caused by changes in land use; food, fuel, and materials markets (Lewis, 2007).” Righelato and Spracklen (2007) showed that carbon changes related to land use changes could outweigh the avoided emissions through the substitution of petroleum fuel by biofuels. The contribution of this chapter is two-fold: (i) to develop the beginnings of a protocol for system-wide accounting (SWA) systems that incorporates land use and other changes not included in LCA, and (ii) to apply the protocol to a case study of ethanol refined from Iowa corn. We will first lay out the basics of LCA for corn ethanol and gasoline. This serves as the beginning point for SWA because the components of LCA results can be used in SWA. We then assess the GHG impacts of ethanol from Iowa corn based on both types of accounting systems.


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