Introduction to the System of Environmental-Economic Accounts Central Framework (SEEA-CF 2012) European Statistical Training Programme (ESTP): Environmental taxes and subsidies Luxembourg, 26-27 April 2017 Julie L. Hass, Ph.D. THE CONTRACTOR IS ACTING UNDER A FRAMEWORK CONTRACT CONCLUDED WITH THE COMMISSION

Outline Part 1. What is Environmental-Economic Accounting? Part 2. Why do we need Environmental – Economic Accounting? Part 3. What are the building blocks of the foundation for SEEA-CF? Part 4. What can you do with Environmental - Economic Accounts?

Part 1. What is Environmental – Economic Accounting?

Environmental – Economic Accounts Brings together 2 areas of statistics: Economic statistics and Environment statistics

Environmental – Economic Accounts Connect the environmental consequences to the economic activity – at a detailed level – to allow further analyses

Main challenge in developing Environmental – Economic Accounts Getting the two types of statistics aligned so they can be matched up and connected Can seem like solving a jigsaw puzzle

Another challenge… Enviromental statistics are often classified by geographic areas (municipalies, counties, etc.) or non-standard industrial groupings. BUT… Economic statistics are classified by industries (NACE or ISIC) Need to convert from geographic areas to industries, i.e. from «where» to «who» is polluting

Environmental – Economic Accounts Physical Flow Accounts: Supply and Use Tables expanded to include environment Energy Water Air emissions Material Flows

Environmental – Economic Accounts Economic Activities related to the Environment: Identify – by separating out – the expenditures by various economic actors that have the main purpose of protecting, managing or cleaning up the environment Households Government Industries

Environmental – Economic Accounts Asset accounts: Calculate values of natural resources (minerals, energy resources, timber, fish, etc.) by assigning a value to the estimates of the stocks/reserves of physical natural resources. Convert from physical units to monetary units:

Part 2. Why do we need Environmental – Economic Accounting? Aren’t statistics enough?

Why make environmental accounts? Aren’t environmental statistics enough? Statistics are… Often developed to answer one particular question or problem. Difficult to figure out if all information is included. Not always easy to see the whole picture, or how it relates to other things.

Why make environmental accounts? Aren’t environmental statistics enough? Helps to make sense of the larger picture. Helps to identify pieces that are missing Can make connections to other statistics - especially economic statistics

Part 3. What are the building blocks of the foundation for SEEA-CF?

Environmental-economic accounts are built using good statistics, both environmental & economic statistics If Environmental Accounts are thought of as a house These are the foundations Environmental statistics Economic statistics

Without good statistics in the foundation, environmental - economic accounts can NOT be developed Environmental Accounts Environmental statistics Economic statistics

Building blocks: Economic statistics Information from the National Accounts by detailed industry: Value Added Intermediate consumption Employment Also important are the Supply and Use Tables – at their most detailed level

Building blocks: Environment statistics Framework for the Development of Environment Statistics (FDES) Six components At the center of the FDES: Environmental conditions and quality All of the components relate to each other Multi-layered (component, sub-component, topic, individual statistics)

Physical flows, natural resource assets and economic activity in FDES Economic Activity Accounts Natural Resource Asset Accounts Physical Flow Accounts

Difference between SNA boundary and territory boundary (Main difference is usually international transport) Residents Non-Residents National Territory X Rest of World Examples: Emissions Inventory, Energy balances SNA: GDP Subtract these! Add these!

Building blocks… Economic statistics/National Accounts The more advanced and detailed your national accounts, the more you can do! BUT… you can do a fair amount with fairly basic information from your statistical system

Environmental activity accounts and related flows For example: Finding environmental expenditures, taxes, and subsidies in existing statistics. Have «Total Investment» – want investment related to environmental protection and management separated out. Have government expenditures – want only those expenditures related to the environment.

Challenges… Lack of data and/or details Not enough detail in the national accounts Details lost or not obtained from source data Need to implement COFOG and use other relevant classifications when collecting data and producing statistical systems Infrequent business surveys – every 5 years Details Details Details Details Details Details

Part 4. What can you do with Environmental - Economic Accounts?

Intensity / Efficiency indicators Intensities: Emissions of greenhouse gases by value added tonnes carbon dioxide equivalents per million SEK (2010 prices) Total greeehouse gas emissions (CO2-equivalents), output (constant 2005-prices) and emission intensity for Norwegian economic activity (excluding households)

Decomposition Analysis – Why do we see these patterns of change? Source: Statistics Norway

Profiles Environmental Economic Profiles 2008 and 2013 Source: SCB

Environmental Taxes Total Environmental Taxes in Sweden, 2007-2014, current prices, SEK million

Environmental Protection Expenditure in Industry

Environmental Goods and Services Overview environmental sector in Sweden, 2003–2013  Number of establishments, turnover, export and gainfully employed. Source: SCB http://www.scb.se/en_/Finding-statistics/Statistics-by-subject-area/Environment/Environmental-accounts-and-sustainable-development/System-of-Environmental-and-Economic-Accounts/Aktuell-Pong/38171/Environmental-sector/206293//

Summary – SEEA-CF 2012: https://unstats. un

Environmental-Economic Accounts SEEA-CF 2012 Physical Flow Accounts Environmental Activity Accounts and related flows Natural Resource Asset Accounts Combined presentations of accounts / indicators

Thank you for your attention! Julie L.Hass, Ph.D. Independent consultant email: JLHASS@gmail.com