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Life cycle sustainability assessment in the energy sector 131

carbon capture and storage. Therefore it is sometimes argued that discount-
ing should be limited to <5% in a sustainability or social equity setting (see,
for instance, HM Treasury, 2003). The counterpoint to this is that free
market actors will choose to maximize return on investment and, by neces-
sity, must consider the aforementioned opportunity cost and risk issues.
Therefore it may be the case that low discount rates do not reflect viability
in a market setting. Thus the practitioner must attempt to balance economic
pragmatism against ideological principle.
Levelized cost is essentially calculated as the discounted LCC divided by
the discounted energy output over the project lifespan, as follows:

T
X
ð C C + C FO + C VO + C W + C E + C T Þ P t
t
t¼1
LCOE ¼
T
X
E t P t
t¼1
where
LCOE¼Levelized cost of energy
T¼Lifetime of the power plant
C C ¼Capital cost
C FO ¼Fixed operating costs
C VO ¼Variable operating costs
C W ¼Cost of waste management, including recycling
C E ¼Cost of end-of-life disposal (e.g., decommissioning)
C T ¼Cost of transport between stages
P t ¼Discount factor in year t

2.3 Social life cycle assessment

Of the three pillars of sustainability, the social pillar is the least developed in
terms of LCSA tools and techniques. UNEP has published guidelines on
social LCA (UNEP, 2009) which are specifically designed to align with
ISO 14040/14044 in order to maintain consistency with LCA and LCC.
However, operationalizing social LCA is somewhat challenging. This is
partly due to the fact that environmental and economic assessment methods
have their roots in technical, engineering-oriented disciplines that tend to
pursue quantitative metrics, but it is also because many key social issues
are simply difficult or impossible to measure. Sustainable Development Goal
3, for instance, outlines the aim of health and well-being, but in order to