The System of EnvironmentalEconomic Accounting for Water SEEA

The System of Environmental-Economic Accounting for Water (SEEA Water) Regional Workshop on Water Accounting Santo Domingo, Dominican Republic 16 -18 July 2007 Michael Vardon United Nations Statistics Division 1

Outline • • Why have environmental accounting? Water Accounting and the Global Water Partnership and Integrated Water Resource Management SEEA Water • development • structure • standard tables • Indicators from SEEA Water Lessons from implementation 2

Why an accounting approach? • • • Encourages the adoption of standards Introduces accounting concepts to environmental statistics Improves both economic and environmental statistics by encouraging consistency Implicitly defines ownership and hence responsibility for environmental impacts Encourages the development of comprehensive data sets Facilitates international comparisons 3

Strengths of the accounting approach • • • Organised body of information facilitates integrated economic-environmental analysis (complements sustainable development indicators, modelling) Comprehensive and consistent, routinely produced Provides a system into which monetary valuations of environmental costs can be incorporated 4

Environmental-Economic Accounting and Environment Statistics Environment statistics: • 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 Typically not integrated with economic statistics • Separate piles of information 5

Environmental-Economic Accounting builds on Environment and Economic Statistics Integrated information Environmental accounts: • Help to make sense of the larger picture • Help to identify pieces that are missing • Can make connections to other statistics, especially to economic statistics 6

Terminology is not always consistent among economists, environmental statisticians, scientists and policy makers => Need to use a clear, agreed terminology One of the SEEA main contribution is the standardisation of terms and definitions 7

Keys concepts of SEEA Stocks Flows Volume (e. g. tonnes, m 3) Value (e. g. $, £, ¥, €) 8

The role and value of Water Accounting “SEEAW provides the muchneeded conceptual framework for monitoring and assessment” Roberto Lenton, Global Water Partnership 9

Integrated Water Resources Management: core features • • Involves developing efficient, equitable and sustainable solutions to water and development problems Involves aligning interests and activities that are traditionally seen as unrelated or not well coordinated (horizontally and vertically) Needs knowledge from various disciplines as well as insights from diverse stakeholders Not just water: involves integrating water in overall sustainable development processes. Also requires coordinating the management of water with land related resources 10

The challenge: Monitoring and assessing water resources for the MDGs within an IWRM approach Global Water Partnership 11

Development of SEEA Water • • Sub-group on Water Accounting established at the 2003 meeting of the London Group (Rome) Sep 2004 SEEA Water discussed at London Group Meeting (Copenhagen) May 2005 1 st draft SEEA Water discussed in by sub-group (New York) May 2006 2 nd Draft discussed at the User-Producer Conference (Voorburg) Jun 2006 2 nd Draft discussed by London Group and UNCEEA Jul-Dec 2006 SEEA Water finalised by electronic discussion More than 20 experts participated in the Sub-group UNSD coordinated the group and prepared the various 12 manuscripts

SEEA Water – an interim international statistical standard • • • Part 1 of SEEA Water was adopted by the United Nations Statistical Commission in March 2007 as an interim statistical standard Part 2 contains the elements of SEEA Water for which there is less country experience and there is still some debate SEEA Water has been recognized as useful by the users of information 13

SEEA Water Overview • • Stocks and flows Economy and environment 14

SEEW - Structure 9 Chapters, 2 parts: • Part 1 • Ch 1. Introduction • Ch. 2 Water Accounting Framework • Ch. 3 Physical Supply and Use Tables • Ch. 4 Emission Accounts • Ch. 5 Hybrid and Economic Accounts • Ch. 6 Asset Account • Part II • Ch. 7 Quality Account • Ch. 8 Valuation • Ch. 9 Policy use 15

12 Standard Tables 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. Physical supply Physical use Gross and net emissions Emissions by ISIC 37 Hybrid (Monetary and Physical) supply Hybrid use Hybrid supply and use Hybrid water supply and sewerage for own use Government accounts for water related collective consumption services (Monetary) National expenditure for waste management (Monetary) Financial accounts for waste water management (Monetary) Asset account (Physical) 12 Supplementary tables 16

Physical water use: standard table 1 Physical units Industries (by ISIC categories) 1 From the environme nt Within the economy 233, 4143 35 36 37 38, 3 9, 4599 Tot al Hou seh olds Rest of the wor Tot ld al U 1 - Total abstraction (=a. 1+a. 2= b. 1+b. 2): a. 1 - Abstraction for own use a. 2 - Abstraction for distribution b. 1 - From water resources: Surface water Groundwater Soil water b. 2 - From other sources Collection of precipitation Abstraction from the sea U 2 - Use of water received from other economic units U=U 1+U 2 - Total use of water 17

Physical water supply: standard table 2 Physical units Industries (by ISIC categories) Hou seho lds Rest of the worl d Tota l S 2 - Total returns (= d. 1+d. 2) d. 1 - To water resources Surface water Groundwater Soil water d. 2 - To other sources (e. g. Sea water) 1 Within the economy To the environme nt S 1 - Supply of water to other economic units of which: Reused water Wastewater to sewerage 233, 4143 35 36 37 38, 3 9, 45 - Tota 99 l S - Total supply of water (= S 1+S 2) Consumption (U - S) 18

Water emissions: standard table 3 Physical units Industries (by ISIC categories) Pollutant 1 233, 4143 Gross emissions (= a + b) 35 36 38, 39, 4599 Tot al Res t of the wor ld Ho use hol ds Tot al a. Direct emissions to water (= a 1 + a 2 = b 1 + b 2) a 1. Without treatment a 2. After on-site treatment b 1. To water resources b 2. To the sea b. To Sewerage (ISIC 37) d. Reallocation of emission by ISIC 37 e. Net emissions (= a. + d. ) 19

Hybrid water use: standard table 6 Physical and monetary units Intermediate consumption of industries (by ISIC categories) Actual final consumption 35 Households 37 38, 39, 4599 Total industry Final cons umpt ion expe nditu res Social transf ers in kind from Gover nment and NPIS Hs Total Govern ment Capital formation Exp orts Tot al uses at pur cha ser’ s pric e 1 233, 4143 Total intermediate consumption and use (monetary units) of which: Natural water (CPC 1800) Sewerage services (CPC 941) Total value added (monetary units) Total use of water (physical units) Tot al of which: Hydro 36 U 1 - Total Abstraction of which: a. 1 - Abstraction for own use U 2 - Use of water received from other economic units 20

Physical water assets: standard table 12 physical units EA. 131 Surface water EA. 1311 Reservoirs EA. 1312 Lakes EA. 1313 Rivers EA. 1314 Snow, Ice and Glaciers EA. 132 Groundwater EA. 133 Soil water Total Opening Stocks Increases in stocks Returns from the economy Precipitation Inflows from upstream territories from other resources in the territory Decreases in stocks Abstraction of which Sustainable use Evaporation/Actual evapotranspiration Outflows to downstream territories to the sea to other resources in the territory Other changes in volume Closing Stocks 21

Basic concepts and definitions • • • Abstraction from environment Supply and use within economy Returns to environment 22

Indicators from SEEA Water Source of pressure on water resources: • Macro trends in total water use, emissions, water use by natural source and purpose, etc. ‘Decoupling’ economic growth and water use, pollution • Industry-level trends: indicators used for environmental-economic profiles • Technology and driving forces: water intensity/productivity and total (domestic) water requirements to meet final demand • International transport of water and pollution 23

Indicators: economic growth and water pollution Netherlands: water pollution and economic growth, 1999 -2001 24

Indicators: economic growth and water use Botswana: water use and economic Growth, 1993 -1998 25

Environmental Economic Profiles Sweden 1995 26

International transport of pollution Share of pollution in rivers in the Netherlands originating abroad 27

Projecting future water demands Australia 2050 28

Modelling Effects of Price Changes: Murray-Darling River Basin Australia Based on historical water use & price data, simulated impact on GDP of doubling water prices and the expected increases in water use efficiency (WUE) of 1 -2% 29

Key lessons from countries implementing SEEA Water 1. Build on existing statistical/scientific knowledge and information 2. Cooperation essential • Within statistical offices • Between statistical offices, water departments, economic/planning departments and agricultural departments • With the water supply industry • With the scientific and research communities • Between users and producers of information 3. A phased approach is needed • Start with issues of most importance. In water scarce countries it has been water supply and use. In industrialized countries it has been pollution. 4. Pilot or experimental accounts are very useful • Users will appreciate the benefits more easily with concrete examples, even if they are small scale. 30

Contact details Michael Vardon Adviser on Environmental-Economic Accounting United Nations Statistics Division New York 10017 USA Room DC 2 1532 Phone: +1 917 367 5391 Fax: +1 917 363 1374 Email: vardon@un. org 31