Before new technologies enter the market, their environmental superiority over competing options must be asserted based on a life cycle approach. However, when applying the prevailing status-quo Life Cycle Assessment (LCA) approach to future renewable energy systems, one does not distinguish between impacts which are 'imported' into the system due to the 'background system' (e.g. due to supply of materials or final energy for the production of the energy system), and what is the improvement potential of these technologies compared to competitors (e.g. due to process and system innovations or diffusion effects). This paper investigates a dynamic approach towards the LCA of renewable energy technologies and proves that for all renewable energy chains, the inputs of finite energy resources and emissions of greenhouse gases are extremely low compared with the conventional system. With regard to the other environmental impacts the findings do not reveal any clear verdict for or against renewable energies. Future development will enable a further reduction of environmental impacts of renewable energy systems. Different factors are responsible for this development, such as progress with respect to technical parameters of energy converters, in particular, improved efficiency; emissions characteristics; increased lifetime, etc.; advances with regard to the production process of energy converters and fuels; and advances with regard to 'external' services originating from conventional energy and transport systems, for instance, improved electricity or process heat supply for system production and ecologically optimized transport systems for fuel transportation. The application of renewable energy sources might modify not only the background system, but also further downstream aspects, such as consumer behavior. This effect is, however, strongly context and technology dependent. (c) 2005 Elsevier Ltd. All rights reserved.