Eco-costs value ratio
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The EVR model is a life cycle assessment based method to analyse consumption patterns, business strategies and design options in terms of eco-efficient value creation. Next to this it is used to compare products and service systems (e.g. benchmarking).
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The eco-costs/value ratio (EVR) is an indicator to reveal sustainable and unsustainable consumption patterns of people. The eco-costs is an indicator for the environmental pollution of the products people buy, the value is the price they pay for it in our free market economy. Example: When somebody spends 1000 euro per month on housing (in Europe: EVR approx. 0,3) it is less harmful for the environment than when 1000 euro is spent on diesel (in Europe: EVR approx. 1,0). See section 3.1.
The EVR is also relevant for business strategies, because companies are facing the slow but inevitable internalization of environmental costs. At the moment the costs of products don't take into account the environmental damage caused by these products. This "pollution is for free" mentality is less and less accepted by communities.
The EVR makes companies aware of the relative importance of the environmental pollution of their products, and the relative risk they run that future production costs will increase because of this internalization of environmental costs. By using the EVR, companies can make decisions for their product portfolio: abandon products with low value and high environmental costs and stimulate products with high value and low environmental costs. See sections 2.3 and 3.2.