Review of approach 24 March 2015 Workshop biomass carbon and biodiversity sub- accounts of EEA simplified ecosystem capital accounts Review of approach 24 March 2015

Policy references on natural capital accounting At global level: Rio +20 communiqué on natural capital accounting World Bank WAVES initiative 2012 Aichi targets under Convention on Biological Diversity At EU level: 7EAP – Objective 1 focuses on natural capital EU Biodiversity Strategy to 2020 -> ‘MAES’ process EU Resource efficiency strategy

What is ‘natural capital‘ ? MAES working definition Ecosystems as asset: Extent, structure & condition of : Forests, woodlands, rivers, lakes, oceans, coasts, wetlands, grasslands, croplands, heathlands, urban parks, etc. depletable Ecosystem service flows: Provisioning services (food, fibre, energy etc.) Regulation & maintenance (of climate, river flow, pollination etc.) Cultural services (recreation in nature, spiritual use of nature etc.) Ecosystem capital: G E N R A T I Abiotic assets: Solar radiation non- depletable Minerals, fossil fuels, ozone layer, gravel, etc. depletable Abiotic flows: Renewable energy (solar, wind, hydro..) non-depletable Phosphate fertiliser, radiation protection, etc. depletable Note 1: Flows (of services) are not ‘capital’ as such, but can be "capitalised" - i.e. the value of natural assets (i.e. the nat cap value) = NPV of the flow of services. So the flow manifests the value of the asset/capital, but is not the capital itself. In general discussions these are considered part of natural ‘capital’ and hence depicted with the same colour but a different background shading. Note 2: In reality there is not a clear cut boundary between biotic and abiotic components (ecosystems combine the two) but for illustration’s sake these are separated here. Note 3: Ecosystem capital is characterised as ‘fragile and depletable’ as plants by definition regrow (i.e. ‘renews’) but most destroyed ecosystems and extinct species cannot be recreated, hence are not ‘renewable’. A similar argument goes for assets and flows linked to solar radiation: this by definition cannot be ‘renewed’ as it either exists or it doesn’t. However, solar, wind, hydro energy can be called renewable energies as they are sourced from a non-depletable source (solar radiation) which means that the energy to be harvested ‘renews’ itself day after day due to the power of the sun. 3

Related initiative – knowledge innovation project (KIP) to establish the EU layer Key issue: Ecosystem accounting needs spatially explicit data layers. Such data (e.g. from LUCAS, Copernicus, FSS, Natura 2000…) could be better integrated and a regularly maintained EU layer of accounts developed, which countries can link into. Approach: Design integrated system for an EU data foundation with key partners (EEA, ENV, Eurostat, CLIMA, JRC, RTD and MS) to develop and maintain a core set of EU level accounts. Timeline fits to MAES roadmap and step-wise approach.

Proposed EU roadmap on NCA Successful step-wise implementation of : 2015-16: Bio-physical ecosystem asset accounts (at EU level and in MS) 2016-18: Accounting for ecosystem services 2018-20: Valuation of ecosystems and their services

Main objectives of the workshop Review methodological options for developing the component accounts on biomass carbon and biodiversity in EEA’s simplified ecosystem capital accounts (SECA) Discuss critical methodological choices with regard to modelling frameworks, the geo-referencing of input data layers & environmental interpretation of accounting results If possible: provide advice on developing the long-term data foundation for these sub-accounts via an efficient combination of statistical data, in-situ ecosystem survey data and satellite observation programmes

General considerations in developing SECA (Simplified) ecosystem capital accounts should ideally be: Representative of key ecosystem functions / types of ecosystem capital stock Targeted on functional ecological units (water basins, ecosystem types etc.) Look at trends that are likely to show a clear signal Follow an analytical approach aligned with characteristics of data (i.e. avoiding analytical over-reach) Be as transparent and communicable as possible Aligned with key EU policy targets & planetary boundaries Be nested in existing ecosystem accounting guidance

Evolution in development of EEA SECA Work on updating or building SECA component accounts under the current methodology (~ ENCA) and an in-house review have shown that its full implementation and the calculation of a final ‘ECU value’ are currently not possible. Hence the EEA has opted for a dashboard approach which is still to be fully shaped up. The two options below show the possible development of SECA for use at EU level: A dashboard focused on the previous EEA approach (aka technical report 2011 & ENCA, looking at ‘sustainability of use’ etc.) combined with some additional elements, such as ‘fish accounts’ & nutrient balance (if possible) A dashboard that focuses on key aspects of ecosystem status and use, building on simple accounts and indicator information across a wide range of ecosystem capital elements (this could also be developed as a set of ‘mini-dashboards’).

Key workshop questions on carbon account Biomass carbon is a very prominent account in current methodological guidance documents. However, there is a need to review its approach and environmental meaning in Europe. Hence we propose the following questions: What ecosystem functions or what use of ecosystem capital could we measure via a biomass carbon sub-account? What parameters or indicators do we have that would allow us to measure trends in the critical functions or ecosystem capital that we want to monitor? Which data do we that would allow us to measure the chosen trends? How do we account for the EU’s global impact on biomass carbon stocks?

Key workshop questions on biodiversity The hypothesis underlying this sub-account is that a decline in biodiversity/landscape structure implies a loss of ecosystem capital and also of related ecosystem services. So the questions are: What are the best indicators or parameters to monitor trends in biodiversity and in landscape structure (bearing in mind the criteria set out above)? Which data do we have on species and landscape characteristics that help us to measure the chosen trends? How do we best combine them for constructing a ‘biodiversity account’ ?

Dashboard 2: combining simple accounts & indicators Year/ account Farm- land (loss & HNV) Forests (biomass use & ‘HNV’) Inland waters (assets & quality) Marine (Fish stocks & nutrient loading +?) Biodiversity (NLEP rev & bird trends + Art. 17 ?) Urban (Green areas & living space) Global (CO2 levels & critical loads for N) Year X 100 Year X + 1 98 97 103 102 101 Year X + 2 96 104 93 Accounting result/index 97 % 96% 104% 93% 100% Inverse of 102%   Potential simplification * ** *** Sum up: median, average.. Sum up: red & green dots, % of trends, balance between red and green, ..