How materials, energy, transport, and capital contribute to emissions along the supply chain of Material Handling Equipment: The Path Extraction Method applied to USEEIO

Hertwich, Edgar and Liu, Yiwen and Jiang, Meng (2026): How materials, energy, transport, and capital contribute to emissions along the supply chain of Material Handling Equipment: The Path Extraction Method applied to USEEIO.

Abstract

The importance of machinery and equipment (ME) to the use of materials and thus to the circular economy and their contribution to climate change mitigation has only recently been recognized. Previous analyses based on EXIOBASE distinguished only five types of ME, giving a coarse picture that is not satisfactory to pinpoint opportunities for mitigation. Here we utilize the US benchmark input-output tables, which represent the production and use of 65 types of ME. We use Hypothetical Extraction Method (HEM) to identify the part of the carbon footprint that can be attributed to the input of materials and energy as well as the use of transport and capital equipment. We use Structural Path Analysis (SPA) to identify those suppliers important for contributing to the carbon footprint of the product of interest through using materials, energy, transport, capital, or direct emissions. We illustrate the application of this path extraction (PEX) to the greenhouse gas emissions (GHGE) of the production of material handling equipment. Cut-off criteria need to be set to less than 0.5% of total impacts to consider more than the first tear of suppliers to each of the investigated production processes.

• Item Type: MPRA Paper
• Language: English
• Keywords: machinery and equipment production, supply chains, material efficiency, climate change mitigation
• Subjects: D - Microeconomics > D5 - General Equilibrium and Disequilibrium > D57 - Input-Output Tables and Analysis; L - Industrial Organization > L6 - Industry Studies: Manufacturing > L60 - General; L - Industrial Organization > L6 - Industry Studies: Manufacturing > L64 - Other Machinery ; Business Equipment ; Armaments; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q56 - Environment and Development ; Environment and Trade ; Sustainability ; Environmental Accounts and Accounting ; Environmental Equity ; Population Growth; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q57 - Ecological Economics: Ecosystem Services ; Biodiversity Conservation ; Bioeconomics ; Industrial Ecology

References

(1) Hertwich, E. G. Increased Carbon Footprint of Materials Production Driven by Rise in Investments. Nature Geoscience 2021, 14 (3), 151–155. https://doi.org/10.1038/s41561-021-00690-8. (2) Paelinck, J.; De Caevel, J.; Degueldre, J. Analyse Quantitative de Certaines Phénomenes Du Développment Régional Polarisé: Essai de Simulation Statique d’itérarires de Propogation. Bibliothèque de l’Institut de Science économique 1965, 7, 341–387. (3) Defourny, J.; Thorbecke, E. Structural Path Analysis and Multiplier Decomposition within a Social Accounting Matrix Framework. Econ J 1984, 94 (373), 111–136. https://doi.org/10.2307/2232220. (4) Peters, G. P.; Hertwich, E. Structural Analysis of International Trade: Environmental Impacts of Norway. Economic Systems Research 2006, 18 (2), 155–181. https://doi.org/10.1080/09535310600653008. (5) Hertwich, E. G.; Liu, Y.; Jiang, M. Critical Review of Climate and Resource Costs and Benefits of Machinery and Equipment. Engineering 2025. https://doi.org/10.1016/j.eng.2025.10.034. (6) Liu, Y.; Jiang, M.; Hertwich, E. G. Environmental Impact of Machinery and Equipment: A Comparison between EXIOBASE, National EEIO Accounts Models and Ecoinvent. Enviro. Sci. Technol 2025, 59 (50), 27254–27266. https://doi.org/10.1021/acs.est.5c08581. (7) Hertwich, E. G.; Jiang, M. The Carbon Footprint of Machine Tools and Metal Working Machinery in U.S. Manufacturing. Procedia CIRP 2025, 135, 420–425. https://doi.org/10.1016/j.procir.2024.12.040. (8) Jiang, M.; Wang, R.; Wood, R.; Rasul, K.; Zhu, B.; Hertwich, E. Material and Carbon Footprints of Machinery Capital. Environ. Sci. Technol. 2023, 57 (50), 21124–21135. https://doi.org/10.1021/acs.est.3c06180. (9) Yang, Y.; Ingwersen, W. W.; Hawkins, T. R.; Srocka, M.; Meyer, D. E. USEEIO: A New and Transparent United States Environmentally-Extended Input-Output Model. Journal of Cleaner Production 2017, 158, 308–318. https://doi.org/10.1016/j.jclepro.2017.04.150. (10) Miller, T. R.; Berrill, P.; Wolfram, P.; Wang, R.; Kim, Y.; Zheng, X.; Hertwich, E. G. Method for Endogenizing Capital in the United States Environmentally-Extended Input-Output Model. Journal of Industrial Ecology 2019, 23 (6), 1410–1424. https://doi.org/10.1111/jiec.12931. (11) Berrill, P.; Miller, T. R.; Kondo, Y.; Hertwich, E. G. Capital in the American Carbon, Energy, and Material Footprint. Journal of Industrial Ecology 2020, 24 (3), 589–600. https://doi.org/10.1111/jiec.12953. (12) Ingwersen, W. W.; Li, M.; Young, B.; Vendries, J.; Birney, C. USEEIO v2.0, The US Environmentally-Extended Input-Output Model v2.0. Sci Data 2022, 9 (1), 194. https://doi.org/10.1038/s41597-022-01293-7. (13) Södersten, C.-J. H.; Wood, R.; Hertwich, E. G. Endogenizing Capital in MRIO Models: The Implications for Consumption-Based Accounting. Environ. Sci. Technol. 2018, 52 (22), 13250–13259. https://doi.org/10.1021/acs.est.8b02791. (14) Cabernard, L.; Pfister, S.; Hellweg, S. A New Method for Analyzing Sustainability Performance of Global Supply Chains and Its Application to Material Resources. Science of The Total Environment 2019, 684, 164–177. https://doi.org/10.1016/j.scitotenv.2019.04.434. (15) Hertwich, E. G.; Koslowski, M.; Rasul, K. Linking Hypothetical Extraction, the Accumulation of Production Factors, and the Addition of Value. Journal of Industrial Ecology 2024, 28 (4), 736–750. https://doi.org/10.1111/jiec.13522. (16) Miller, R. E.; Blair, P. D. Input-Output Analysis: Foundations and Extensions, Third edition.; Cambridge University Press: Cambridge ; New York, 2022. (17) Hertwich, E. G.; Wood, R. The Growing Importance of Scope 3 Greenhouse Gas Emissions from Industry. Environmental Research Letters 2018, 13 (10), 104013. https://doi.org/10.1088/1748-9326/aae19a. (18) Hertwich, E. G.; Jiang, M. The Carbon Footprint of Machine Tools and Metal Working Machinery in U.S. Manufacturing. In Life Cycle Engineering (LCE 2025); Procedia CIRP; Elsevier: Manchester, 2025.