Large amount of rare earth metals is stored in the used electric products. Hitachi has started to develop the environment-friendly process for rare earth metals recovery from used magnets. We report here the environmental impact of our process, in comparison with the conventional recycle process utilizing solvent extraction. As an evaluation method, Life-cycle Impact assessment Method based on Endpoint modeling ver. 2 (LIME2) developed by the National Institute of Advanced Industrial Science and Technology (AIST) in Japan is applied. It was found that the environmental impact of the new process was more than that of the conventional process. For further reduction of its environmental impact, minimization of energy consumption to operate the equipment was most effective. Decreasing the amount of magnesium, used as an extractant, and the improvement of the extraction rate of rare earth metals were also considered as specific options for reducing energy consumption in the plant development.