Earth Observations for the SDGs GEO - Mexico City, 10 November 2015 John M Matuszak Bureau of Oceans, international Environmental and Scientific Affairs United States Department of State Data, Information and Knowledge The Unfinished Foundation for Sustainable Development : The example of Natural Capital Accounting

Sustainable Development and Wealth We don’t judge a company solely on the basis of its income statement—look at both income and balance sheet. Increasing assets (wealth) support long-term growth. In the short term, income can appear to grow by liquidating assets, but this undermines long-term growth. Why do we assess country economic progress on the basis of national income, GDP alone? (J. Stiglitz,, WB Nobel prize, economics former Chair President's Council of Economic Advisors, former WB Chief Economist ) The source of income and well-being is wealth, broadly defined to include – Tangible/Manufactured capital (land, physical equipment infrastructure, Natural capital, ‘Intangible’ capital (human capital and social capital)

What is the methodology for NCA?

SEEA responds to complex policy questions such as How can natural resources be used sustainably? What is the impact of regulatory environmental measures on different economic sectors and households? How do ecosystems contribute to the well-being of people and to the economy? Which are the most cost-efficient measures to improve the state of the environment? What are the effects of environmental taxes on the environment and on the economy? Etc.

Where has Natural Capital Accounting been most useful? 1.Indicators for monitoring sustainable development 2.Water accounting: managing a scarce resource 3.Energy and air pollution: cleaner, more efficient production 4.Stocks of minerals & energy: fiscal rules, managing mineral revenues for long term growth 5.Land and ecosystems: balancing the needs of tourism, commercial and subsistence agriculture, water supply, soil erosion, and other uses

From Statistics to Accounts SEEA integrates environment and economic statistics by following the same statistical principles (those of the System of National Accounts) StatisticsAccounts Source: United Nations Statistics Division

Audiences for information Indicators Basic Statistics (environment, business, labor,…) Accounting (SNA, SEEA-CF) Public Politicians Policy Makers Strategic planners Researchers Micro data

I. Improving water supply and sanitation services II. Managing water supply and demand III. Improving the state of the environment and water resources Adapting to extreme hydro-meteorological events Water security Water issues and policy objectives: A broad grouping Reduced quality and pollution Allocating water among competing users: contribution to GDP, employment, social wellbeing Managing for increased floods/droughts Limited access Unequal distribution Policy objectives

BOSTWANA Are scarce water resources allocated efficiently? Source: DWA

Example Norway: «Profile» with output and GHG emissions by industry – who contributes the most 10

11 WAVES © Urban land Agricultural land Forest land Land cover types Scope of the ecosystem based forest account Scope of the resource based forest account Ecosistema urbano Ecosistema agricola Ecosistema forestal Urban land Agricultural land Forest land The framework Shared area of analysis Individual resources Ecosystems Ecosistema forestal (Mangle)

12 WAVES © Broadleaved primary forest LCEUs EAUs Natural park (protected forest) Not protected forest Broadleaved secondary forest BSUs: Basic Statistical Units Min grid resolution info Closest to ecosystems Long-term monitoring Mapping of the forest area & ecosystems Steps proposed by the EEA to define units to account for forest assets Basic Statistical Units

13 WAVES © Forest landStanding timber Indicators to characterize the forest ASSET Condition of forest ecosystems

14 WAVES © 2014 Ecosystem extent Characteristics of ecosystem condition VegetationBiodiversitySoilWaterCarbon Type of LCEUArea Indicators (e.g. biomass) (e.g. species richness) Indicators (e.g. organic matter content) Indicators (e.g. water quality) Indicators (e.g. net carbon balance) Forest ecosystem A Changes of ecosystem condition VegetationBiodiversitySoilWaterCarbon Opening condition Improvements in conditions Reduction in condition Closing condition Monetary units EAU or LCEU Opening stock Additions to stock Regeneration-natural Regeneration. human Total additions to stock Reductions in stock Extraction and harvest Catastrophic losses Total reductions in stock Revaluations Closing stock of ecosystem assets General structure of the forest accounts – ASSET ACCOUNTS Monetary units Type of timber resource Cultivated timber resources Natural timber resources Available for wood supply Not available for wood supply Opening stock of timber resources Additions to stock Natural growth Reclassifications Total additions to stock Reductions in stock Removals Natural losses Catastrophic losses Reclassifications Total reductions in stock Closing stock of timber resources Type of timber resources Cultivated timber resources Natural timber resources Available for wood supply  Cultivated: management practices constitute a process of economic production  Natural: where the previous doesn’t apply.  Not AFWS: due to physical, economic or regulatory reasons  resource by resource  forest asset (forest ecosystem unit)

15 WAVES © Provisioning services Regulating services Indicators to characterize the forest FLOWS Cultural services

16 WAVES © Economic activities: suppliers Generation of ecosystem services EnterprisesHouseholdsGovernmentRest of the worldTotal Type of ecosystem services (by CICES) Provisioning services Regulating services Cultural services Use of ecosystem services EnterprisesHouseholdsGovernmentRest of the worldTotal Provisioning services Regulating services Cultural services General structure of the forest accounts – FLOW ACCOUNTS Products  PHYSICAL UNITS: flow of materials and products / flow of ES  MONETARY UNITS: aggregated value. Economic activities: intermediate and final consumers Products Services S uppliers Consumers

17 WAVES © 2014 Example: Land cover classification based on Landsat 8 imagery. Pacific coast; Guatemala  Dynamic data source of area covered by vegetation  Identification of different vegetation types  Upgrade forest inventories  Information forest condition  Geographical reference  Constant technological development Why remote sensing? Where do we get the data from? Spaceborne remote sensing

18 WAVES ©  Particularly useful for deriving indicators of environmental services.  Some examples are: Wild fauna population Erosion protection Surface discharge Carbon sequestration Green area deficit in urban areas Why modeling ?  Various indicators of forest assets and flows can not be measured directly. Forest Modeling

19 WAVES © 2014  Livelihood surveys  Population census  Other statistics, reports, spatial databases  etc.  SNA  validate  Global forest watch (?) 19 Source: Mustonen, S.; Raiko, R.; Luukkanen, J. Bionergy consumption and biogas potential in Cambodian households. Sustainability (5) doi: /su Other sources

20 WAVES © 2014 High temporal resolution for near real-time monitoring and response High spatial resolution for accurate measurement of annual deforestation track and respond to change