1. Introduction
As of December 2022, the European Commission reached a consensus regarding the final version of the Carbon Border Adjustment Mechanism (CBAM), thereby expanding the scope of products and emission ranges [1]. This is expected to affect various areas, such as the global economy and industrial sectors. The EU CBAM places a fair price on carbon emitted during the production of carbon-intensive goods that enter the EU as well as to prevent carbon leakage, which is consistent with the EU Emissions Trading Scheme. The aim is to impose the same carbon price level on imported products as on EU-produced goods [2]. Before the CBAM entered into force on January 1, 2026, quantifying the environmental benefits of recycling to reduce the embodied emissions within products and allocating these benefits between industries in an interconnected manner were challenging. The sectors included in the first phase of the EU CBAM included iron and steel, cement, aluminum, fertilizers, electricity, and hydrogen [1]. In Korea, the steel industry, which is a major exporter to the EU, is expected to be affected the most significantly, instead of the cement industry, which features a high proportion of domestic demand.
Among the various byproducts generated in the steel production process, slag is a representative byproduct, which constitutes 80% of steel byproducts. As the sixth largest steel-producing country in the world, Korea produces a significant amount of steel byproducts (approximately 32 million tons annually), which constitutes 23.4% of the total waste generated by all industries in Korea. The recycling rate of steel slag in Korea is 100.2%, which implies the complete recycling of all slag. The steel industry refers to steel byproducts as “other products” or “co-products” with different uses that do not require disposal [3].
Steel slag is a byproduct of steel production. It is formed by physically and chemically mixing impurities other than steel, which are generated during steelmaking. As shown in Fig. S1, steel slag can be classified into two main types depending on its production process: blast furnace slag and steelmaking slag [4].
Blast furnace slag is generated by producing pig iron from iron ore, coke, limestone, and other materials in the blast furnace. It is formed when SiO2 and Al2O3, which are present in iron ore and coke, respectively, react with lime at high temperatures. Blast furnace slag can be classified into two types based on the cooling method: granulated (water-cooled) slag and pelletized (air-cooled) slag. Granulated slag features chemical components like those of Portland cement and possesses hydraulic properties that render it suitable as a cement or cement substitute. Meanwhile, steelmaking slag undergoes crushing and particle size selection processes and is utilized as road construction aggregates and soil conditioner, to name a few.
Although more than 80% of blast furnace slag, which is a byproduct of the steel industry, is currently recycled in the cement industry, standardized criteria for allocating the environmental benefits of recycling between the steel and cement industries do not exist. In particular, the imminent implementation of the CBAM after the transitional phase from 2023 to 2025 necessitates diverse methods for allocating environmental benefits derived from recycling steel byproducts to the steel and cement industries. The appropriate allocation of environmental benefits between the two industries will facilitate the reduction in embodied emissions arising from the steel input materials.
Life cycle assessment (LCA) is typically used to quantify environmental benefits and burdens associated with recycling. Furthermore, it allows one to understand the distribution of environmental benefits and burdens among products, processes, or activities based on the allocation procedures selected [5–13].
LCA can be broadly categorized into attributional life cycle assessment (ALCA) and consequential life cycle assessment (CLCA). ALCA evaluates potential environmental effects throughout the value chain, i.e., from raw material acquisition to manufacturing, use, and disposal, with emphasis on the product. The aim of this study is to identify the causes contributing to the environmental effects observed currently. Meanwhile, CLCA is an approach that identifies socioeconomic changes and future environmental variations that may occur due to the product system from a future-oriented perspective [14–19]. Depending on whether the ALCA or CLCA is applied, the logical structure of LCA, such as the goal and definition of the study, target audience, system boundaries, and data type and quality, varies.
When the goal and scope of LCA require an ALCA approach that focuses on quantifying the direct environmental effects resulting from the input and output of products or processes [20, 21], multifunctionality is implemented by including co-functions or applying system expansion within the functional unit. As a form of partitioning, the cut-off approach allocates all environmental impacts to the functional unit [18]. Chen et al. [22] applied allocation methods to recycle steel byproducts via ALCA, which included system expansion (avoiding allocation), mass-based, and economic allocation. In ALCA, waste recycling may be perceived as environmentally unfriendly because the environmental burden can be allocated to the parent system, depending on the allocation method [21].
CLCA is applied to assess environmental impacts, including avoided and additional emissions resulting from the production of a product. In the case of CLCA, waste recycling is perceived as environmentally friendly because it prevents adverse effects associated with waste disposal, such as landfilling [21]. CLCA expands the system boundary of a material to account for changes in demand and supply of substituted materials in the global market, thus allowing the net environmental effects of material substitution and other consequential factors to be evaluated [20].
When the goal and scope of LCA require the application of CLCA, a substitution approach through system expansion is applied. The substitution approach includes various methods, such as the end-of-life (EoL) approach, waste mining approach, 50–50 approach (a combination of EoL and waste mining), and a market price-based substitution method that incorporates all these approaches [18].
The recycling of byproducts and waste as secondary resources obviates the requirement for virgin material production owing to the substitution of virgin materials and waste disposal, thus resulting in environmental benefits [18, 23, 24]. In the context of byproduct and waste recycling, recycling processes are shared between two product systems: the system in which the recycled material is generated and the system in which the recycled material is used. These recycling processes are referred to as multifunctional processes in LCA. The system to which the environmental burdens and benefits should be attributed remains unclear [25, 26] because the aim of LCA is to quantify the environmental impacts of a single product, which results in allocation issues [24]. Allocation refers to the partitioning of inputs and outputs among multiple products or product systems [27]. The appropriate allocation procedure varies depending on the approach used [15, 18, 19, 24]. Studies regarding LCA for recycling granulated blast furnace slag (GBFS) are limited. The existing studies are primarily based on ALCA [6, 22, 28, 29]. The application of CLCA to assess the environmental benefits or burden of recycling GBFS has not been reported.
Gomes et al. [30] conducted a study using the CLCA methodology to assess the long-term supply–demand constraints of blast furnace slag (BFS) and fly ash used as clinker substitutes. Based on the forecast of a constrained supply of BFS and fly ash, they substituted BFS and fly ash with clay and limestone fillers. Kua [20] compared the environmental effects of steel slag as a substitute for sand using both the ALCA and CLCA methodologies. However, no studies have been conducted to quantify the environmental benefits of materials to the steel and cement industries.
The allocation method used for LCA significantly affects the results; however, consensus regarding the universal allocation methodology has not been reached [31–38].
Therefore, this study aims to propose a method for allocating the environmental benefits that arise from recycling Granulated Blast Furnace Slag (GBFS), a byproduct of the steel manufacturing process, in the production of Slag Cement (SC) as a substitute for Portland cement. Currently, more than 80% of blast furnace slag, a steel byproduct, is recycled in the cement industry. However, there is a shortfall in the criteria for allocating the environmental benefits of recycling steel byproducts between the two industries. This gap is particularly relevant in light of the recent final agreement on the EU CBAM, highlighting the need for methodologies that interconnectedly allocate environmental benefits from recycling across industries. Existing studies focus primarily on the environmental impact of using steel byproducts in cement production, however this study extends the system boundary to the steel industry where these byproducts originate, allowing for a broader analysis of environmental benefits and burdens. From the perspectives of ALCA and CLCA, this research proposes how recycling GBFS can quantify environmental burdens and benefits, and how these benefits can be allocated between the steel and cement industries.
2. Materials and Methods
The ISO 14044 and 14049 standards [39, 40] recommend allocating unit processes that share environmental burdens via a stepwise procedure that considers the following attributes: 1) Physical relations (e.g., mass), 2) economic value (e.g., the market value of scrap or market value of recycled material compared with the market price of raw materials), and 3) the number of uses the recycled material has been reused after recycling.
The ISO recommends using a closed-loop allocation procedure for both closed- and open-loop product systems, where no changes occur in the inherent properties of the recycled material [39]. Closed-loop allocation implies that the recycled material can be directly substituted for the virgin material at a 1:1 ratio [23]. The open-loop allocation procedure is used when a material is recycled in different systems and no changes occur in the inherent properties of the open-loop product system. However, the ISO standards do not provide a specific definition of the inherent property changes.
Recycling steel byproducts can be regarded as an open-loop recycling process that changes the inherent properties of the material, as the recycled material does not replace the virgin steel material at a 1:1 ratio. Hence, an open-loop recycling procedure was applied in this study.
In LCA studies, byproducts are typically considered separately from recycling, as in the case of energy recovery [18]. However, when waste is converted into useful input materials in subsequent life cycles, it can be considered a byproduct of the previous life cycle. Therefore, the allocation of byproducts and recycling need not be differentiated [25, 41]. Moreover, applying different allocation procedures to byproducts and recycling can result in inconsistencies in the system [42]. Thus, in this study, a recycling allocation method was applied to recycle byproducts.
The purpose of this study is to allocate environmental benefits by considering the substitution of Portland cement with GBFS in the production of SC via ALCA and CLCA. Accordingly, the system boundary was classified based on the approach adopted, i.e., ALCA or CLCA. According to ISO 20915 [43], which is based on ISO 14044:2006[39], the recycling of steel byproducts should not include byproducts generated from steel production through system expansion. In this model, a system expansion method is selected to avoid allocation via ALCA and to substitute virgin material with byproducts via CLCA [15, 44] to address the issue of multifunctionality. Therefore, to evaluate the environmental valorization of recycling steel byproduct, the functional unit is set as the production of 300 kg of GBFS. The reference flow is set at 1 ton of hot-rolled coil (HRC), necessary for generating this functional unit, along with 1 m3 of SC to utilize the recycled 300 kg of GBFS and 1 m3 of Portland cement(I) manufactured without using recycled GBFS.
SC is produced by pulverizing and mixing GBFS with Portland cement. It has a lower initial strength than Portland cement but exhibits excellent long-term strength and low heat of hydration, thus rendering it effective in preventing concrete cracking. Furthermore, it exhibits excellent watertightness, acid resistance, abrasion resistance, and workability. It is primarily used to manufacture mass and marine concrete to be used in dams, bridges, harbors, water and sewage facilities, tunnels, retaining walls, foundation concretes, and road pavements.
According to KS L 5210:2017, SC can be classified into three types based on the GBFS content, as shown in Table S1. The physical and chemical compositions of SC must comply with the specifications listed in Table S2.
2.1. Attributional Life Cycle Assessment (ALCA)
2.1.1. System boundary
As shown in Fig. 1, the system boundary of the ALCA approach is expanded from the primary product manufacturing system, where steel byproducts are generated, to the secondary product manufacturing system, where steel byproducts are recycled for cement production (Cradle to Gate). The use and disposal phases, and transportation are not considered.
2.1.2. Allocation procedures
Recycling GBFS results in environmental benefits to the steel industry, and the use of recycled secondary raw materials leads to environmental benefits to the cement industry.
The system expansion method quantifies environmental effects by expanding the system to include the process of recycling the byproducts produced within the studied system into another system. The environmental burden from byproduct recycling is allocated to the studied system, whereas the environmental burden arising from the substitute process is subtracted from the studied system [6, 15].
When applying system expansion, the environmental benefits are calculated by deducting the environmental burden associated with the production of GBFS, which is a byproduct of the steel industry, from the environmental burden generated during the production of the main product in the steel industry. In the cement industry, the environmental benefits resulting from byproduct recycling are calculated by deducting the environmental burden associated with producing a product using virgin materials from the environmental burden associated with producing a product using GBFS. Furthermore, when assessing the environmental benefits in the cement industry, an additional allocation of the environmental burden assigned to GBFS should be applied by deducting the environmental burden allocated to GBFS based on either mass-based or economic-based allocation from the environmental burden generated during steel production.
In this study, environmental burdens and benefits were allocated by applying a cut-off approach, which did not consider the benefits of EoL recycling. Mass- and economics-based allocation methods were applied (Table S3). Based on the calculated environmental burdens and benefits, environmental benefits were allocated between the steel and cement industries (Table S4).
2.2. Consequential Life Cycle Assessment (CLCA)
2.2.1. System boundary
As depicted in Fig. 2, the system boundary of the CLCA approach was extended to include the cradle-to-grave lifecycle stage, while considering only short-term causal effects. Long-term causal effects such as market changes or energy demand due to supply changes caused by substitutes were not considered.
The avoided burden of recycling GBFS was considered, and SC was produced via an alternative process in the subsequent system, where recycling, landfilling, and incineration constituted 99.2%, 0.6%, and 0.2%, respectively, based on the national waste and treatment status [45]. Almost 100% of GBFS is currently recycled; therefore, a 100% landfill scenario was not assumed. In addition, avoided burden of not utilizing Portland cement as a raw material as much as recycled GBFS, were included.
2.2.2. Allocation procedures
For the CLCA approach, the following four allocation methods were selected based on typically applied standards and guidelines for LCA allocation: 1) EoL approach, 2) circular footprint formula (CFF), 3) market price-based allocation, and 4) 50–50 method. The mathematical representations for these methods are shown in Table S5.
The EoL approach is primarily used when considering substitution in recycling, and the environmental benefits are attributed to the production of recycled materials because the production of primary materials in the future is avoided. Recycled materials do not bring environmental benefits and carry the burden of the primary material [18]. It is typically applied in ACLC and CLCA and is relatively easy to implement. Therefore, various standards and guidelines have been recommended, such as ISO 14044:2006, ISO/TR 14049:2012, ISO 14067:2018, ISO 20915:2018, PAS 2050:2011, the Greenhouse Gas Protocol, and the World Steel Association [18, 24].
The CFF is reasonably complex to apply and considers the recycled content, EoL recycling rate, quality of recycled materials for the input and output of the product life cycle, and balance between supply and demand for recycled materials through Factor A. Factor A, which reflects market realities, assumes values ranging from 0.2 and 0.8. When demand exceeds supply for materials such as metal or glass, A = 0.2 is recommended. The CFF considers the environmental benefits of using recycled materials, including the avoided impacts of virgin material production through recycling and the environmental benefits of product recycling. However, it does not consider the avoidance impacts of waste disposal through recycling. This allocation method is recommended in the Product Environmental Footprint (PEF) Guide [46] [24].
Market price-based allocation is a method that allocates the environmental burden of virgin material production between products that use virgin materials and those that use recycled materials. ISO 14067 [47], similar to the CFF, provides allocation coefficients (Factor A) for each material. However, in contrast to the CFF, allocation Factor A in market price-based allocation serves the opposite function. Factor A, which is based on the global market value of scrap and recycled materials, assigns higher weights to the use of recycled materials because the value is closer to zero.
The 50–50 method was proposed to distribute the environmental impacts of raw material production and final disposal between the first and final life cycles. It was initially proposed by Baumann and Tillman [48] and later simplified by Ekvall [20] as a CLCA approach to estimate the indirect effects of open-loop recycling. This allocation method is mandatory for all recycled materials, as stipulated in the PEF Guide [18, 46].
2.3. Data acquisition and calculation
The materials and energy required to conduct the LCA are listed in Table S6. When producing 1 ton of HRC, the amount of GBFS generated is 0.3 tons. For SC production, the weights were calculated based on the blending ratio of 0.3 tons of GBFS, and for the production of Portland cement (I), GBFS was not used. The materials/energy list for HRC was based on field data from Company H, for SC on field data from Company I, and for Portland cement (I) on data calculated by Company I. To account for the avoidance effects during waste disposal, recycled GBFS was assumed to be manufactured into SC and subsequently treated entirely as construction waste after use. Waste treatment scenario at the EoL stage was prepared based on the statistics by Ministry of Environment [45] in Korea, as recycling at 99.2%, landfill at 0.6% and incineration at 0.2%.
When ALCA was applied based on the cut-off approach, two allocation methods were adopted: mass- and economy-based allocation. Allocation factors (%) were determined. For the economy-based allocation, the market price was calculated based on data provided by Company H. As mentioned earlier, when applying CLCA, Factor A was applied to the CFF and market price-based allocation methods. Additionally, allocation factors were applied, the details of which are listed in Table 1.
In the environmental impact assessment, the Global Warming Potential (GWP) was used as the environmental impact category. The EU CBAM is a policy based on imposing a carbon tax on greenhouse gas emissions, aimed at adjusting carbon prices between products produced within and outside the EU to contribute to climate change mitigation. The key metric considered in the CBAM is GWP, which is used to quantify greenhouse gas emissions during the product production process. This study focuses on preparing for the full implementation of the CBAM by allocating the environmental benefits derived from recycling GBFS between industries in an interconnected manner, thus reducing the embodied emissions in products. Therefore, the environmental impact category was limited to GWP. The GWP emission factors were applied based on the national LCI database, and for materials without established emission factors in Korea, international LCI DB were utilized as shown in Table 2.
3. Results and Discussion
3.1. Results and discussion
The selection of allocation methodologies for ALCA and CLCA can be summarized into seven scenarios, as depicted in Fig. 34. In Scenarios 1 to 3, ALCA was applied via system expansion to avoid allocation and the cutoff approach using mass- and economy-based allocation methods. Scenarios 4–7 involved CLCA and system expansion to account for substitution effects. In these scenarios, the EoL approach, the CFF, market price-based allocation, and the 50–50 method were used.
Based on the environmental impact assessment results, environmental benefits were separately allocated to the steel and cement industries using the ALCA and CLCA approaches. The results are presented in Fig. 4 and Table 3. In general, the recycling of GBFS offered environmental benefits to both the steel and cement industries. For comparison, when GBFS was not recycled, the LCA results for steel production (1 t of HRC) and cement production (1 t of Portland cement Class (I)) were used as reference values, which were 2.50E+03 kg CO2 eq. None of the results exceeded the reference values.
Among the CLCA approaches, EoL approach, the 50–50 method, and market price-based allocation showed the most environmental benefits, in that order. However, these three methods must be scrutinized because they impose environmental burdens on raw material production at the final disposal stage. The EoL and 50–50 methods are the most advantageous allocation methods for the steel and cement industries, respectively, with environmental benefits of up to 90% and 72%, respectively.
These findings highlight the importance of considering various allocation methods and scrutinizing the environmental effects at different stages, particularly at the final disposal stage. By diversifying allocation methods and providing appropriate incentives for recycling, the steel industry can benefit from recycling steel byproducts, which have been proven to be sustainable and environmentally friendly.
Limitations were indicated in the data collection and life cycle inventory (LCI) analysis by assuming that SC offers the same performance as Portland cement. However, recycling GBFS as a secondary raw material was shown to be sustainable and environmentally friendly. Furthermore, from the perspectives of ALCA and CLCA, various allocation methods were applied to allocate environmental benefits between the steel and cement industries under different scenarios. Previously, environmental benefits were allocated between the two industries based solely on the cut-off approach, which is driven by economic value in Korea. Because the economic value of GBFS is undervalued, it is unfavorable to the steel industry. As such, recycling incentives are expected to be promoted by diversifying the allocation methods for the steel industry.
3.2. Sensitivity analysis
Sensitivity analysis is typically conducted to assess and mitigate uncertainties arising from constraints and inaccuracies in data gathering and the assumptions made within the model. In this study, to calculate the avoided effects during waste treatment, recycled GBFS was assumed to be processed into SC and then treated entirely as construction and demolition waste after use. Waste treatment scenario was created based on the Ministry of Environment (2022) statistics for the EoL stage, with recycling at 99.2%, landfill at 0.6% and incineration at 0.2%. However, statistics up to before COVID-19 (2017–2019) indicated that the amount of mixed construction waste increased by 5% annually compared to 2017 (MoE, 2022). For mixed construction waste, the waste management strategy involves prioritizing recycling for recyclable materials, followed by incineration if recycling is not feasible, and landfill if incineration is also not an option. Therefore, for the four CLCA allocation method scenarios considering the EoL stage, the impact of uncertainty in waste treatment on the LCIA results needs to be assessed. The sensitivity of the GWP to changes in the treatment method for mixed construction waste, with landfill and incineration rates increasing to 5% respectively, was analyzed and presented in Table 4.
When landfill rates were increased by 5%, resulting in a 5% decrease in recycling rates, the sensitivity was found to be minimal, ranging from 0.00% to 0.24%, indicating that the impact of landfilling is not significant. Increasing incineration by 5% and decreasing recycling rates by 5% showed the highest sensitivity in scenario 7, which employs the 50–50 method, sharing the environmental impact of raw material production and final waste treatment between the first and last life cycles equally. Furthermore, an increase in incineration by 5% resulted in a negative impact value, signifying that the environmental benefits of GBFS recycling decrease with the incineration of waste. It is deduced that an increase in the amount of waste incinerated at the EoL stage leads to a reduction in environmental benefits.
4. Conclusion
In this study, ALCA and CLCA by scenario were applied to distribute the environmental benefits between the steel and cement industries when replacing Portland cement with SC by recycling GBFS. The scenarios were as follows:
Scenario 1: ALCA - system expansion (allocation avoidance) – no allocation;
Scenario 2: ALCA - partitioning – cut-off approach (mass based);
Scenario 3: ALCA - partitioning – cut-off approach (economy based);
Scenario 4: CLCA – system expansion (substitution) – EoL approach;
Scenario 5: CLCA – system expansion (substitution) – CFF;
Scenario 6: CLCA – system expansion (substitution) – market price-based allocation;
Scenario 7: CLCA – system expansion (substitution) – 50–50 method.
The LCA results indicated that recycling GBFS provided environmental benefits to the steel and cement industries. Among the CLCA approaches, EoL approach, the 50–50 method, and market price-based allocation showed the highest environmental benefits, in that order. However, these three methods must be scrutinized because they impose environmental burdens on raw material production at the final disposal stage. The EoL and 50–50 methods were the most advantageous allocation methods for the steel and cement industries, respectively, with environmental benefits of up to 90% and 72%, respectively.
Recycling GBFS as a secondary raw material was shown to be sustainable and environmentally friendly. Furthermore, from the perspectives of ALCA and CLCA, various allocation methods were applied to allocate environmental benefits between the steel and cement industries under different scenarios. Previously, the method of allocating environmental benefits between the two industries was widely used through the cut-off approach based on economic value in Korea. However, this approach may not adequately reflect the actual value of GBFS and it is unfavorable to the steel industry. The economic value of GBFS is often underestimated due to being assessed against the cost of conventional waste disposal, which could result in relatively lower incentives for recycling within the steel industry. Diversifying allocation methods to reflect the avoided environmental impacts due to recycling is expected to enhance the incentives for recycling. Furthermore, evaluating the recycling value of byproducts should not only consider economic value but also environmental benefits, resource-saving effects, and carbon emission reductions, among other environmental and social values. Such diversified allocation methods and re-evaluation of the value of recycling steel byproducts should be developed through consultations and discussions with policymakers and relevant stakeholders and derived a rational allocation method that maximizes the incentive effects.
While limitations were indicated, such as the constraints of data acquisition and the lack of consideration regarding the differences in performance between products produced using primary materials and those produced using recycled secondary materials, the findings of this study are expected to provide guidance for future policy decisions and internal decision-making processes. In particular, discussions regarding policies must be conducted prior to the full enforcement of the EU CBAM, the latter of which is anticipated to provide an opportunity for coordination and cooperation between the two industries. Furthermore, the results of this study can serve as foundational data for the development of national LCI databases for GBFS recycling. Additionally, the results may be used to diversify allocation methods that have been previously applied unfavorably to the steel industry because of the underestimation of the economic value of GBFS.
In this study, only the short-term avoidance effect was considered when applying the CLCA approach. Hence, future studies should consider the long-term market changes resulting from changes in demand and supply, such as an increase in the SC market share due to the recycling of steel byproducts.
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