This research project explores the application of the design approach of Eco-efficient Value Creation and the model of the Eco-cost/Value Ratio to practical cases, in order to advance the potential contribution of designers to accelerating the transition towards an environmentally sustainable society. The Eco-efficient Value Creation approach is aimed at enabling designers to effectively create design solutions which combine a low environmental impact with a high customer perceived value, in order to achieve an increase in sustainable design solutions capturing market share over unsustainable design solutions currently on the market.

In search of sustainable business models, product innovation must fulfil a double objective: the new product must have a higher (market) value, and at the same time a lower eco-burden. To achieve this objective, it is an imperative that the value, the total costs of ownership, and the eco-burden of a product are analysed at the beginning of the design process (idea generation and concept development). The design approach that supports such a design objective, is called Eco-efficient Value Creation (EVC). This approach is characterised by a two-dimensional representation: the eco-burden at the y-axis and the costs or the value at the x-axis. The value is either the Willingness to Pay or the market price. The eco-burden is expressed in eco-costs, a monetised single indicator in LCA (Life Cycle Assessment): an app for IOS and Android, and excel look-up tables at the internet, enable quick assessment of eco-costs. A practical example is given: the design of a new concept of domestic street lighting system for the city of Rotterdam. This new concept results in a considerable reduction of carbon footprint and eco-costs, and shows the benefits for the municipality and for the residents, resulting in a viable business case.

Calculating the environmental benefits of energy saving systems in dwellings in a life cycle assessment (LCA) has two major issues, namely: how to deal with the customer behaviour and how to deal with rebound effects. Both issues are important for sustainable strategies. From a user-centred design perspective, two fundamentally different strategies are observed, namely: a ‘passive’ end-user, who invests in insulating the building and maintaining their preferred behaviour routines, versus an ‘active’ end-user; who must change his or her behaviour in order to save energy. A combined analysis of cost, (market) value, and eco-burden is used to compare and evaluate the two strategies; by applying the methods of eco-costs/value ratio (EVR) and eco-efficient value creation. Simulation software is applied to calculate the results for the active end-user approach (by means of home energy management systems [HEMS]). The energy savings for a passive user approach (applying thermal insulation) are calculated with straightforward heat loss calculations. The rebound effect of energy savings is taken into consideration. From the environmental point of view, the optimal insulation thickness is calculated, by comparing the energy savings with the environmental burden of the insulation materials. This analysis shows that HEMS are effective for poorly insulated houses, but not for well insulated houses. Governmental policies that focus only on insulation, however, lack the urgency of greenhouse gas reduction; the HEMS for existing houses is an indispensable tool for a fast transition to less domestic energy consumption.

Eco-efficient Value Creation is a method to analyse innovative product and service design together with circular business strategies. The method is based on combined analyses of the costs, market value (perceived customer value) and eco-costs. This provides a prevention-based single indicator for ‘external environmental costs’ in LCA. The remanufacturing of products is an environmental and sustainable approach, in the circular economy, and can deliver lower eco-costs of materials depletion and pollution. From a business point of view, however, remanufacturing seems to be viable in B2B niche markets only. In consumer markets, remanufacturing is less common. The question is how can remanufacturing become a viable business solution for mainstream consumer markets. Traditional ‘green’ marketing approaches are not enough: green has a positive, but also negative connotations, so marketing approaches are complex. By using the Eco-efficient Value Creation method, marketing strategies for the roll-out of remanufacturing in mainstream consumer markets, can be revealed. This approach has led to the development of five aspects, which are key to innovative circular business models, for remanufacturing: (1) buyers differ from the buyers of the ‘new product’ (2) quality must be emphasised in all communications (3) risk must be taken away from the buyer (4) top level service is required to convince the buyer (5) a ‘green’ brand may support the remanufactured product image.

There is a need for metrics to analyse complex business models in the circular economy. Life cycle assessment (LCA) currently is the best defined system to analyse the environmental aspects, and is capable to analyse circular systems, Product Service Systems, and systems for recycling. However LCA falls short of analysis of the added value of business models. Since new sustainable business models are part of the transition towards a circular economy, there is a need for combined analyses of value and ecoburden. This paper applies the LCA-based Eco-costs Value Ratio (EVR) Model to analyse potential negative environmental effects of business initiatives on a system level, and to provide a theoretical approach to the design of sustainable business models by means of a three dimensional approach of costs, eco-costs and market value. Two methods are applied for analysis and design: Eco-efficient Value Creation (EVR
benchmarking) and the Circular Transition Framework (describing stakeholder activities which are required for the transition towards sustainable business models). The practical case of the analysis, design and implementation of a business model for sustainable water recreation in Friesland (a province in the Netherlands) is used to validate the usefulness of these two LCA-based methods.
The conclusion is that the approach of Eco-efficient Value Creation helps to avoid many pitfalls of the design of circular business models (e.g. having a positive result on product level, but having a negative effect on societal level; having a positive effect on the environment but having insufficient customer
perceived value to overcome fierce market competition). The Circular Transition Framework reveals pitfalls and opportunities in implementation (e.g. the coordination between business models and governmental policies).

Future Living Studio (FLS) is a temporary design studio concept that aims to explore and embed sustainable design approaches in the Vietnamese product design context. Each studio brings together local and visiting designers to develop collections of environmentally sustainable products with participating local companies. These products act as reference products and inspiration for demonstrating the potential of sustainable design in Vietnam. From 2011 to 2013, three studios were deployed in Vietnam where nine local designers, nine visiting designers, and 9+ local production companies took part. The aim of this paper is to assess how sustainable the products developed in three editions of FLS are, by analysing their environmental impacts and their competitive value on domestic versus Western European export markets. The increasingly popular eco-costs/value ratio (EVR) model is used to give a portrayal of the environmental and economic sustainability of the products developed, based on a 'willingness to pay' (WtP) assessment that supplements the life cycle assessment (LCA) approach.