stern-like biodiversity study - brainstorm on approach dg env - wednesday 27 june 2007 a...

Stern-like Biodiversity Study - Brainstorm on Approach

DG ENV - Wednesday 27 June 2007

A methodological proposal and European case study

Jean-Louis WeberProject manager

Spatial analysis, land and ecosystem accounting

EEA

[email protected]

Stern-like Biodiversity Study

Brainstorm on Approach


Roy Haines-YoungCentre for Environmental Management,

School of Geography,University of Nottingham



GDP + Final use of ecosystem services

IDPIDPInclusive Domestic Product

Accounting for environmental benefits and costs

Benefits: the Demand sideBenefits: the Demand sideC

ost

s: t

he S

upp

ly s

ide

Cost

s: t

he S

upp

ly s

ide

+

Intermediate consumption

+

Maintenance of the resource

+

Restoration from ecosystem degradation

FCPFCP

Full Cost of Products



Economic-Environmental Accounts: International and European context

• SEEA 2003 (Integrated System of Environmental and Economic Accounting)

• Accounts in monetary AND in physical units

• Tested in Europe by Eurostat, EEA and most member countries; now: European Strategy (ESEA) 2003, revised 2007

• 2006, SEEA endorsed as an international standard by the UN Statistical Commission – revision by 2012

• 2006, SEEA Water – « interim standard » from 2007

• Other implementation manuals cosnsidered: energy & minerals, land & ecosystems

• At the EEA: Land cover accounts for Europe 1990-2000 (2006), report and gridded database; “Implementation of land and ecosystem accounts at the EEA”(Journal of Ecological Economics – 2007)



SEEA: expansion of the System of National Accounts (UN1993) in order to include more environmental aspects

Natural resources EcosystemsEconomic

assets (SNA)Non-economic

assets

Openingstocks

Openingstocks

OpeningState

SNAtransactions

and otherflows

Changes instocks

Changesin stocks

Economicactivities,

naturalprocesses,

etc.

Changesin state

Closingstocks

Closingstocks

Closingstate

Described in SNA

RM HASSAN - UN The System of Environmental and Economic Accounting (UN 2003) - RANESA Workshop June 12-16, 2005 Maputo



Economic Environmental Accounts: Flows and Assets

EGSGDPE

cono

mic

ass

ets E

cosystem assets

GDP: Gross domestic Product

EGS: Ecosystem Goods and Services

Inte

rme

dia

te

us

e o

f E

GS

Fin

al u

se

of

no

n-m

ark

et E

GS



Economic system and ecosystem: co-evolving

EGSGDP

Eco

nom

ic a

sset

s Ecosystem

assets



Inte

rme

dia

te

us

e o

f E

GS

Fin

al u

se

of

no

n-m

ark

et E

GS



Of the usefulness of environmental accounts

• They are integrated, physical and monetary, connected to the National Accounts (classifications, definitions…)

• They are based on sound rules (e.g. double-entry accounting)

• But– The world does not work according to the structure of

accounts…– Accounts are human constructs

• A way or organising our thoughts and information• They need to focus on

– Needs of end users who make decisions– Values and views of people who depend on or make use of the

services that nature offers otherwise they will not capture the real world



Back to the logic underlying the Millennium Ecosystem Assessment…

Biophysical structure or

process(e.g. woodland

habitat or net primary productivity )

Service(e.g. flood

protection, or harvestable products)

Service(e.g. flood

protection, or harvestable products)

Function(e.g. slow

passage of water, or biomass)

Function(e.g. slow

passage of water, or biomass)

Benefit(e.g. willingness to pay for woodland

protection or for more woodland, or

harvestable products)

Benefit(e.g. willingness to pay for woodland

protection or for more woodland, or

harvestable products)Σ Pressures

Limit pressures via policy action?

Minimum levels of service

(service limits)



Demand and Supply of ecosystem goods and services

• Demand: – Market: EGS imbedded in the price of commodities

(intermediate consumption of economic sectors) – Non-market end services: individual consumption of

households, collective consumption of government, beneficiaries x willingness to pay

• Supply: – Market: full cost of products (physical and monetary,

intermediate consumption of resource and indirect degradations);

– Sustainability of intermediate consumption/use measured by the integrity/health of natural assets, in physical terms



Demand side

• Key questions:– What are the services associated with this place or

situation that matter for sustainability and how are they generated?

– How important is each of these services, to who, and for what reasons?

– What, if anything, could replace or substitute for each of the benefits, either here or elsewhere?

– Do we expect to have enough of each of these services either here or elsewhere in the future?



Inclusive Domestic Product

FinalEGS

IDP

GDPF

ina

l us

e o

f n

on

-ma

rke

t EG

S

Inclusive Domestic Product

GDP: Gross Domestic Product


IDP: Inclusive Domestic Product

Weak sustainability



Supply side, environmental limits and policy action/inaction

Time

Undamaged

Service

output

Damaged

Target

Limit

Collapse

Marginal losses

Marginal gains

What are the risks and vulnerabilities?

Policy choices

Enhanced

Maintained

Neglected

Eroded or degraded

Precautionary limit?

Accounting Modelling



Sustainable

intermediate use

Non-Sustainable

intermediate use

Eco

nom

ic a

sset

s Ecosystem

assetsEGS

IDP

GDP

Fin

al u

se

of

no

n-m

ark

et E

GS




Sustainable and non sustainable economic use



Stocks

Integrity/Health

Sustainable

intermediate use

Non-Sustainable

intermediate use

Eco

nom

ic a

sset

s Ecosystem

assetsEGS

IDP

GDP

Fin

al u

se

of

no

n-m

ark

et E

GS




Ecosystem Assets and calculation of Full Cost of Products

Alternative prices for resource use

according to environmental

objectives

Observation of symptoms:

Vigor

Organisation

Resilience

Dependence

Support to healthy populations






LEP: Land Ecological Potential

€: Monetary units

: Physical units EGS

IDP

GDPE

cono

mic

ass

ets E

cosystem assets

Inte

rme

dia

te

us

e o

f E

GS

Fin

al u

se

of

no

n-m

ark

et E

GS

€&

€€€&€€&&

Physical and monetary accounts

€

LEP



Key points

• Non market ecosystem services: Final use is to be measured in physical units first; pricing will come in a second step

• The full cost of the products has to be calculated as : production/distribution cost + cost of restoration of the resource + costs of degradation of ecosystems (indirect use of services) + rents

• Assets accounts doesn't need to be valued in money in any cases; physical assets (incl. health, resilience) will tell about the sustainability of use of EGS



MARKET THEORY

POLITICALECOLOGY

DECISIONTHEORY

SYSTEM ECOLOGY

THERMODYNAMICSTHERMODYNAMICS

Market Analysis

CostMethods

CostMethodsHedonicPrices

ContingentValuation

ContingentValuation

Contingent choice

EmergySynthesis

EmbodiedenergyMFAEFA

HANPP

Extended Exergy

Accounting

Multi-criteriaAssessment

VA

LU

AT

ION

M

ET

HO

DV

AL

UA

TIO

N

ME

TH

OD Cost Methods

WeakComparability

Crematistic (money)Valuation

PhysicalValuation

Multi-criteriaValuation

VALUEVALUECONCEPTCONCEPT

Strongcomparability

CO

NC

EP

TU

AL

FR

AM

EW

OR

KC

ON

CE

PT

UA

LF

RA

ME

WO

RK

USEVALUE

NON-USEVALUE

ENERGYVALUE

MULTIPLEVALUES

BIOPHYSICALVALUE

ENERGYMEMORY

EXERGYMETABO

LISMDIRECT

USEINDIRECT

USEOPTION VALUE

HERITAGEEXISTENCE

OB

JE

CT

OF

VA

LU

AT

ION

OB

JE

CT

OF

VA

LU

AT

ION

FRAMEWORK FOR VALUATIONVALUE CONCEPT AND DERIVED APPROACHES

ENVIRONMENTALENVIRONMENTALECONOMICSECONOMICS

ECOLOGICALECOLOGICALECONOMICSECONOMICS

Lomas et al. 2006Lomas et al. 2006



Cost of water supply and environmental cost

REMAINING RESOURCE COST (CRR)Cost of the hypothetical measures of restoration of the degradation that will be left in water bodies with respect to the natural state of reference (IN) once reached the objective of the WFD (EO).

ENVIRONMENTAL COST(CA)

Cost of partial restoration to meet the objective of the WFD in 2015 (EO) from the maximum state of deterioration (EE) generated by the human activities before applying any measures of mitigation. A part of the same one (EA-EE) corresponds to the cost of the measures applied until now. The rest (EO-EA) corresponds to the cost of the measures necessary to reach the objective of the WFD.

COST OF WATER SUPPLY(CAA)Costs of resource procurement, distribution and return. The acquisition cost must be the optimal combination of resource generation and resource reassignment of the uses based on the quality required.

Cost of servicesIntegral cost of replacement

CRR CAA

CA

EN

EO EE

EA

CA

Joan

Esc

riù W

ater

Age

ncy

of C

atal

unya



Example of full cost accounting : physical and monetary

Environmental Cost of the WFD = CAR1 + CAR2 + CAR3

Cost of the “effective measures” for meeting the objetive of the WFD considered in the

Programe of Measures of River Basin Management Plan

Cost of measures formitigating impacts of uses over the water bodies

CAR1

Cost of measures of ecosystem restoration CAR2

Cost of measures for resource procurement CAR3

restoration

DA1

DA3

DA2

PHYSICAL ACCOUNTS MONETARY ACCOUNTS

Degradation ofwater quality

Impacts on water use

Impacts onecosystems

Physico-chemicalobjectives

Biological &hydro-morphological objectives

Joan

Esc

riù W

ater

Age

ncy

of C

atal

unya



Cálculo del coste ambiental

Degradation of the water bodies

Impacts on uses

Impacts on the

ecosystems

EnvironmentalCost

As cost of the measures of restoration of:

Why this option?

The environment itself is not “monetisable” (“no entiende de dinero”, “no está en el mercado”).

Contingent valuation methods offer only a subjective value of the environment.

The cost of restoration measures tells us of the environmental costs, when these measures are effective and efficient (reference to targets)

AN

ÁL

ISIS

EC

ON

ÓM

ICO

DE

L A

GU

A E

N C

AT

AL

UÑ

A

Joan

Esc

riù W

ater

Age

ncy

of C

atal

unya



GL

OB

AL

RE

GIO

NA

LR

EG

ION

AL

LOCALLOCALE

co

sy

ste

m

Fu

nc

tio

ns

Manufactured Capital

Buildings Roads and

infraestructuresMachines

Tools

Financial Capital

Money (Change value)

Human Capital

Workers Wealth

AptitudesEducation

Knowledge

Social-cultural Capital

Institutions Social networks

Trust Ethic

GobernanceHu

ma

n-m

ad

eC

ap

ita

lN

atu

ral

Ca

pit

al

FRAMEWORK FOR VALUATIONECOSYSTEM SERVICES, FUNCTIONS AND NATURAL CAPITAL

Co

nec

tivi

ty

wit

h o

ther

ec

osy

stem

sFunctioning

Primary Production Water Cycle Biogeochemical Cycles

Structure

Geotic Structures Biotic Structures

Dynamism time

ECOSYSTEMS

time

Ecologicalintegrity

Resilience

Ec

os

ys

tem

se

rvic

es

Production Habitat InformationRegulation

Provisioning Services Regulation Services Cultural Services

- Water availability - Crops- Hunting - Fishes- Acuiculture - Harvests- Livestock - Medical plants- Fibers - Potential uses

Soil formation Carbon secuestration Air quality Water quality Pest and diseases control Polinization Invasion resistence Habitat provisioning

Tourism and recreation Aesthetic Cultural heritage Spiritual values Education Research Traditional knowledge

Martín-López et al. In pressMartín-López et al. In press



Wetlands, a first case study for Eureca!...

… and for the assessment of biodiversity costs

Food Energy Water WoodLandscape

servicesBroad pattern intensive agricultureExtensive and mosaic agro-systemsForestsDry open natural landscapesWetlandsRivers and lakesUrban systems

MountainsCoastal ecosystemsSea

Reporting unitsAdministrative (NUTS)River basins (sub-basins)Bio-geographic regions

Socio-Ecosystems

Services



Accounting for ecosystems: Conceptual Model

Distribution Patterns Neighbourhoods

S

C

A

L

E

S

Distribution Patterns Neighbourhoods

S

C

A

L

E

S

Spatial analysisSpatial analysis

DP S IRDriving forces (production, consumption)

Pressures

State of environment

Impacts of state on society, economy and ecosystems

Responses

CausationCausation

FrameworkFrameworkStocks & flows

Values

Goods & Services

System interactions

Stocks & flows

Values

Goods & Services

System interactions

Indicators Indicators

& &

Aggregates Aggregates

€&



Approach based on LEAC (+ rivers…)



LEAC: from changes to flows of land cover

LCF3

LCF1

LCF2

LCF5

LCF4

LCF7

LCF6

LCF8

Change Matrix(44x43=1932

possible changes)summarized into

flows

LCF9

Corine land cover types 1 2A 2B 3A 3B 3C 4 5

Land cover flows

Art

ific

ial a

reas

Fo

rest

ed la

nd

Wet

lan

ds

Wat

er b

od

ies

LCF1 Urban land management 737 15 19 0 8 0 0 780LCF2 Urban residential sprawl 1924 1867 200 145 8 3 2 4149LCF3 Sprawl of economic sites and infrastructures 77 2728 1595 665 451 35 22 53 5627LCF4 Agriculture internal conversions 17252 10062 27314LCF5 Conversion from other land cover to agriculture 273 935 1796 1734 155 96 50 5039LCF6 Withdrawal of farming 2393 2860 5253LCF7 Forests creation and management 254 35803 5166 1048 1063 3 43337LCF8 Water bodies creation and management 191 252 253 117 190 17 21 1042LCF9 Changes due to natural & multiple causes 311 44 15 1317 1323 1041 229 252 4534

No Change 160016 1149717 802502 990736 255914 50289 45502 45473 3500149

LCF1 Urban land management 780 780LCF2 Urban residential sprawl 4149 4149LCF3 Sprawl of economic sites and infrastructures 5627 5627LCF4 Agriculture internal conversions 15695 11619 27314LCF5 Conversion from other land cover to agriculture 2450 2590 5039LCF6 Withdrawal of farming 1124 2792 1244 23 70 0 5253LCF7 Forests creation and management 42547 766 24 43337LCF8 Water bodies creation and management 21 1021 1042

No Change 160016 1149717 802502 990736 255914 50289 45502 45473 3500149

199

0

2000



Framework of Ecosystem Accounts

Natural assets accounts • Natural capital structure, resilience & wealth (physical

units, by sectors)• Capital consumption & accumulation (physical units, €)• Ecosystem assets wealth (€)

Natural Capital Accounts/ living & cycling natural capital

Functions & Services• Land use function• Natural function

Supply & use of ecosystem goods and services(Use of resource by sectors, supply to consumption &

residuals, accumulation, I-O analysis)

Material/energy flows(focus on biomass, water,

nutrients, residuals)

Accounts of flows of ecosystem goods and services

Counts of stocks integrity/health

(by ecosystem types, focus on quality)

Ecosystem Stocks &

State Accounts

Core accounts of stocks & flows

(by ecosystem types, raw quantities)

Land coverWaterBiomass, CN, P

Eco

syst

em t

ypes

Economic sectorsSpatial integration

Economic integration



Changes in QuantityChanges in Quantity

Changes in QualityChanges in Quality

Opening stockOpening stock

Closing stockClosing stock

Land use functions

Land use functions

X

Services

Land use functions

X

Services

Minimum levels of service

(service limits)

Reflections on our efforts to

build ecosystem accounts



Partnership for case study on Mediterranean wetlands

• EEA, ETC-LUSI and ETC-BD• ETCLUSI partners (UAB, Danube Delta, Andalusia)• The Observatory of Mediterranean Wetlands

(under creation, FP7)• Voluntary partners: Tour du Valat (Camargue),

EKBY (Greece), MEDWET• Talks for coordination with the ESA GlobWetlands

project Phase 2 (from 2008)

stern-like biodiversity study - brainstorm on approach dg env - wednesday 27 june 2007 a...

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