European experience regarding environmental accounts Institutional Financial and

European experience regarding environmental accounts: Institutional, Financial and Technical aspects Dr Cameron Easton Spatial Information Policy & Standards Efficiency and Transformational Government Division 25 th Rabat May 2011

European experience with environmental accounting Reminder SEEA 1993 Development of NAMEA by Netherlands Adoption of NAMEA by EU 1994 Green Accounting 1994 Development of SEERIE 2003 European Strategy for Environmental Accounting ESEA 2003 2008 Revised European Strategy for Environmental Accounting ESEA 2008 2009 Fast track implementation of simplified ecosystem capital accounts

European experience with environmental accounting Main elements Development of Policy at EU level Development of environmental methodology EEA

European experience with environmental accounting Development of Policy Some key policy initiatives 1994 COM (94) 670 Directions for the EU on Environmental indicators and Greened National Accounting 1997 Amsterdam Treaty • harmonises statistics • Integrates environment with general economic and sustainability policy 2006 Sustainable Development Strategy • Extend core system of national income accounting by • integrating stock and flow concepts and non-market work • including satellite accounts • e. g. environmental expenditures, material flows • taking into consideration international best practices 2007 Beyond GDB - • Requirement for integrated environmental-economic accounting • Complementing physical accounts with monetary figures

Implementation of Policy - Eurostat Functions of Eurostatin environmental accounting • • • Developing methodologies for environmental accounting Collating data from member states Publishing data from member states Linking environmental accounts with environment statistics Publishing analysis of collated environmental accounts Contributing to international standards – SEEA 2012

Functions of Eurostat - Development of Methodology Development of methodology done in partnership with member states The Director's meeting on Environment Statistics and Accounts (DIMESA) is a high-level group composed of senior officials from the European Statistical System and from the Environmental Protection Agencies. • discusses and adopts the strategy of Environmental Statistics and Accounts. The Environmental Accounts Working Group and Environmental Expenditure Statistics Working Group • Agree methodological and practical issues relating to environmental accounts.

Functions of Eurostat - Development of Methodology Publication of guidance manuals/handbooks • • • • Manual for Air Emission Accounts Handbook on environmental goods and services sector 2009 Economy wide material flow accounts and derived indicators • A methodological guide 2001 Economy wide material flow accounts compilation guide 2009 Environment expenditure statistics • Industry data collection handbook 2005 Environment protection expenditure • General government and specialised producers data collection handbook 2007 Environmental taxes - Statistical guide 2001 OECD/ Eurostatenvironment protection and review joint questionnaire 2005 SEERIE environmental protection expenditure account conversion guidelines 2005 SEERIE environmental protection expenditure accounts • Compilation guide 2002 European framework for integrated environmental and economic accounting • For forests 2002 Workbook related to SEERIE environmental protection expenditure account • Compilation guide 2002 SEERIE – European System for the collection of economic information on the environment 1994

Functions of Eurostat - Collation of data Data collected from Member States by questionnaires • Air emission accounts questionnaire 2010, revision 1/09/2010 • New JQ 2010 Environmental Protection Expenditure and Revenues , Euro New JQ 2010 Environmental protection expenditure and revenues nat. currency • New JQ 2010 Environmental protection expenditure and revenues, NACE 2 Euro • New JQ 2010 Environmental protection expenditure and revenues, NACE 2 nat. currency • New JQ 2010 Environmental protection expenditure and revenues, questions • New uestionn Q. 2010 Environmental taxes by economic activities, NACE Rev. 1. 1 • New uestionn Q. 2010 Environmental taxes by economic activities, NACE Rev. 2 • Economy-Wide Material Flow Accounts Questionnaire 2009 • EGSS Trial Data Collection 2009 • EGSS First Official Dta Collection, Questionnaire 2011 • EGSS First Draft List of Products based on CPA

Functions of Eurostat - Publication of data Database holds data for • • Monetary flow accounts Physical flow and hybrid accounts Data tables published for all aspects of environmental accounts and statistics • • General and regional statistics National Accounts Sector accounts Etc http: //epp. eurostat. ec. europa. eu/portal/page/portal/environmental_accounts/data/main_tables

Functions of Eurostat - Publication of collated information and analysis Collated information and analysis of: • Monetary flow accounts • Topics include: • • • Physical flow and hybrid accounts • Topics include: • • • Environmental Protection Expenditure Environmental taxes Environmental goods and services sector (EGSS) Country Studies • For projects funded by EC Economy wide material flows NAMEA air survey 2006 Economic activities and pressure on environment 1995 – 2001 Country studies Environmental Asset Accounts • Topic include • • Natural resource accounts • Oil and gas • Forests Subsoil assets – pilot studies Water accounts – pilot studies Country studies

Implementation of Policy - European Environment Agency (EEA) Functions of EEA in environmental accounting Developing methodologies for economic - environmental accounting Linking with Eurostatdata collection and analysis Publishing data from member states Linking environmental accounts with environment statistics Publishing analysis of collated environmental accounts Developing Fast track implementation of simplified ecosystem capital accounts for Europe • 2009 - 2012 • Contributing to international policy and standards • Common International Classification of Ecosystem Services (CICES) • Draft CICES presented to UNCEEA in June 2010 • • • Priority Projects for EEA • • Land Cover Accounts Water Accounts Sustainable Consumption and production Ecosystem Capital Accounts

European Environment Agency (EEA) - Priority Areas Land Cover Accounts • Land cover accounting methodology defined • Methodology published in EEA Report 11/2006 • Land Accounts for Europe 1990 – 2000 (Towards integrated land ecosystem accounting) • Methodology covers • basic land cover stock and flow accounting techniques • Identifies classifications • Contextualises landscape analysis and land cover accounts • Uses 1 km sq grid – aggregated for reporting units

European Environment Agency (EEA) - Priority Areas Land Cover Accounts EEA Report 11/2006 covered Data for 1990 and 2000 25 countries Land Cover data updated 2009/10 • Update covers 2006 • 34 countries • Results used in 2010 State of Environment report

European Environment Agency (EEA) - Priority Areas Land Cover Accounts Globe. Corine • Partnership with European Space Agency Data available • 2006 – EU Area • 2009 – EU Area • - Eastern Mediterranean • - Southern Mediterranean

European Environment Agency (EEA) - Priority Areas Water Accounts SEEA Water 2007

European Environment Agency (EEA) - Priority Areas Sustainable Consumption and Production 2006 Sustainable Development Strategy 2008 Sustainable Consumption and Production Action Plan SCP requires: • Analysis of: • Material flow accounts • Input/output hybrid accounts under NAMEA • Integration of SCP analysis and ecosystem accounts • Flows and trade • Ecological sustainability of resources and benefits

European Environment Agency (EEA) - Priority Areas Ecosystem Capital Accounts Ecosystem accounts needed to record • Supply of ecosystem goods and services • Assess ecosystem potentials and integrity. Health, viability Significant are of EEA activity 2007 Beyond GDB - • Requirement for integrated environmental-economic accounting • Complementing physical accounts with monetary figures

European Environment Agency (EEA) - Priority Areas Developing Ecosystem Capital Accounts Joint Project: • Eurostatcovers economic sectors • EEA covers ecosystems Priority physical accounts defined: • Land (land cover accounts) • Carbon • Water • Biodiversity Accounts cover: • Balance of stocks and flows within ecosystem as economic system • Ecosystem health account • Basic economic balances linked to commodities accounts • Flows of • Land • Carbon • water • Linkage with geographic data – crops, timber use, water use • Overlay resource use and ecosystem condition – productivity/health • Defines ecological sustainability coefficients • Accounts include estimation of non-recorded ecosystem/maintenance costs

European Environment Agency (EEA) - Priority Areas Developing Ecosystem Capital Accounts • Defining Ecosystem Services Assessing benefits from Ecosystem Services • Pragmatic functional approach being taken • Identify ecologically sustainable economic benefits from healthy ecosystems • Benefits identified from beneficiary sector accounts • Ecological sustainability coefficients from physical accounts • Ecosystem services from use of selected ecosystem functions • Not liner relation to ecosystem capital • Is scale dependent • Therefore pilot projects on selected ecosystem services • First priorities • Carbon sequestration • Water purification

Environmental Accounting Progress in Member States Environment Accounts defined well defined many countries e. g. • Germany • • environmental accounting since 1980 s Fully compatible with SNA; SEEA based Leader in development of material and energy flow accounts Accounts for emissions, land-use, water, environmental expenditure, environment related taxes • Netherlands • NAMEA accounting since 1993 • Accounts for air and water emissions, energy flows, environmental taxes, waste, nutrients and subsoil • Sweden • • • Environmental accounting since 1990 s Accounts follow SEEA Asset accounts forests Flow accounts for water use, energy, chemicals, air and water emissions, waste. Accounts fro environmental expenditure, environmental taxes and environmental subsidies • • • Environmental accounting since 1908 s Some natural resource asset accounts Physical flow accounts Resource management expenditure accounts Forest asset accounts Subsoil asset accounts Flow accounts for water, recycling, air emissions (NAMEA), water emissions Environment protection expenditure accounts well developed Developing water asset accounts Disaggregates government expenditure on biodiversity • France Some other member states have less well developed and partial accounts

Environmental Accounting Scotland Very Limited Progress • Some pilot projects only For example: Carbon Assessment Project • As part of the process that will inform the setting of targets and the options for meeting them Scottish Government has embarked upon the Carbon Assessment Project ( CAP). • The assessment of the carbon impact of Government activity and spend on the wider economy currently features three main strands of work: • The development of a methodology for providing a high level assessment of the carbon impact of total Government spend - a High Level Assessment; • the refinement and implementation of methodologies to assess the carbon impact of individual policies and projects - an Individual Level Assessment. • development of mechanisms for using both the individual and high level assessments to drive down emissions associated with government spend and in the wider economy.

Environmental Accounting in Europe Next Steps Further work on Revised European Strategy for Environmental Accounting - ESEA 2008 Ecosystem Services experimental work has led to participation in CICES, and 2010 report to UNECEEA Ecosystem Services work also leads to participation in Global Partnership for Wealth Accounting and the Valuation of Ecosystem Services (WAVES) 2010 Simplified Ecosystem Capital Accounts will feed into SEEA 2012/2013

Environmental Accounting in Europe Some Issues are similar to those for international standards • Environmental accounts need to meet the policy demand, e. g: –Measure resource efficiency: maximize benefits while maintaining capital –Indicators to supplement and/or adjust sector and macro-economic aggregates –Policy agenda: continuity, annual updates for year t – 1 are needed –National statements, internationally comparable… • Physical accounts supporting monetary accounts: –Ecosystem services & sustainable benefits –Ecosystem capital state/degradation & depreciation (consumption of ecosystem capital) • Accounts deep rooted into verifiable observation datasets: –Socio-economic statistics (agriculture, forestry, fisheries, tourism, population) –Monitoring by satellites (land cover, biomass, climate variables…) –Best available in situ monitoring data (water, biodiversity…) • At the start, relevance matters more than accuracy: –Modeled or surrogate estimations are acceptable if based on verifiable datasets –Estimations need to be transparent and reproducible (for measuring change) • Accounts need to be compiled at various scales: –National as well as Global, local government, business –Implementation: in parallel top-down and bottom-up