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PostPosted: Wed Aug 28, 2013 10:47 am 
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I understand that the Producer Price Model includes impacts associated with processes involved in raw material extraction all the way to product assembly. I also understand that the Purchaser Model includes the impacts of the processes from the Producer Model, as well as distribution of the product to the consumer.

If this is correct, I have a question regarding total tons of CO2e from $1 million of Sand, Gravel, Clay, and refractory mining. Using the US 2002 Purchaser Price Model, for $1 million of economic activity, a total of 1360t CO2e are emitted. When I run the US 2002 Producer Price Model, 1490t CO2e are emitted. Since the purchaser model includes transportation, how could it be less than the producer model?

Thank you for your time and assistance.
Regards,
Christopher


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PostPosted: Wed Aug 28, 2013 11:53 am 
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Christopher:

Thanks for posting your question about the GHG differences between the producer and purchaser models. Your question is really interesting and important, and hopefully this answer will help others understand comparative results as well.

You are right that the producer-based model is a "cradle to gate of factory" model and the purchaser model is a "Cradle to consumer" model.

In the case if your sector (Sand and gravel), its the difference between what it costs for sand at the factory, versus what it costs as you take receipt of it, having been delivered to you.

If you look first at the economic supply chains, you'll see that the producer model for $1M of final demand has $0.96M of economic activity in the "sand and gravel" sector and small amounts of many other sectors. The purchaser model has $0.493M of sand and gravel and $.404M in truck transportation. Simply put, the 2002 model is saying that you are getting (roughly) half as much sand and gravel product and paying 40% of your money to get it shipped to you.

But you asked about GHGs. The key thing is that sand and gravel (per dollar) has a lower GHG emissions intensity per $M. It has about 700 tons per $M while truck transportation is about 1000 tons. so when your PURCHASE sand and gravel, less of your money goes to getting sand and more goes to trucking, which has more GHGs. In the end, per $M you get more GHG emissions.

Hope this explains it for you.

One thing that might help in seeing what I am saying is to run the model for $1M in each of the two models in different tabs of your browser, but for each also clicking the "change inputs" button above the results table and selecting BOTH the economic and GHG choices, which puts both sets of columns in the same table.


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