Research @ ISA

Highlight: The Environmental Atlas of Australia

Consuming Australia: the high price our environment is paying for our spending

ISA’s Consumption Atlas, a new interactive online tool developed in collaboration with the Australian Conservation Foundation, reveals that people living in Australia’s wealthiest metropolitan areas are responsible for the country’s highest household greenhouse gas emissions.

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People living in Australia’s wealthiest inner-city suburbs cause more than double the amount of greenhouse gas emissions than households in less affluent areas because of their levels of consumption. ISA’s Consumption Atlas enables Australians to view the greenhouse gas emissions created by households in their suburb. The Atlas shows that the more things people buy, the greater their contribution to climate change. ISA and ACF are encouraging householders to be smarter with how they spend their money, and consider the impact of their purchasing behaviour on the environment.

“Over-consumption is costing us the earth,” said Chuck Berger, ACF’s Director of Sustainability Strategies. ” Use of electricity in the home accounts for just 15 per cent of the greenhouse pollution each of us creates. The majority is created indirectly from the production and transportation of all the things we are buying.”

The Consumption Atlas shows households in areas straddling the harbour in inner Sydney acust Queensland are the country’s biggest greenhouse gas emitters. These areas are closely followed by: inner-suburban Canberra; Woollahra and Mosman in Sydney; Southbank and Docklands in Melbourne; and Fortitude Valley and Newstead in Brisbane. The lowest greenhouse gas emitting Australian households are in Tasmania in the Derwent Valley, Kentish and Brighton areas.

“Everything we buy has an impact on the environment, as all things demand energy, water and other natural resources to produce. People can make a difference to their individual contribution to greenhouse pollution by buying less, wasting less and choosing products that last,” Mr Berger said.

Food and consumer products, such as clothes, appliances, furniture and electronics often require large amounts of energy, water and materials to produce. It is better to spend more of our money on services from sporting-event tickets to massages because services in general demand fewer resources than goods. There is the bonus that services tend to be more labour intensive or, in other words, more jobs are being created per dollar output.

The Consumption Atlas is based on research by ISA, and was assisted by the ACF through the New South Wales Government’s Environmental Trust. The Atlas uses the typical purchasing habits of each suburb in Australia to calculate the impact this consumption is having on the environment, from greenhouse gas emissions to water use and land disturbance.

“The households with the biggest environment impact are high-income earning, inner-city, small or single-person households, said ISA’s Chris Dey. “While inner-city households have better access to public transport and are less car-dependent, with their higher incomes they typically buy more things and travel by air more often. But having a high income doesn’t have to have a high impact on the environment; all of us must consume smarter and more sustainably. Expenditure on energy-efficient appliances and cars, on well-designed and insulated houses, and on services rather than goods, can significantly reduce your eco-footprint”, he added.

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The Industrial Ecology Lab – towards an integrated Australian research platform

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The concept of environmental or carbon footprint is familiar to most Australians. Over the past decade, the footprint concept has become a powerful framework in which to analyse and describe the indirect, often invisible, impacts of our economic activity on the environment. This becomes increasingly useful as globalisation changes our economy. Goods and services now often pass through extended production and supply chains before reaching the end consumer, involving environmental impacts at each transaction point along the way. Producing a car, for example, may involve iron ore mining in Western Australia, car assemblage in Japan, electronic parts imported from China, and thousands of other inputs. At first sight, analysing the environmental implications of such complex supply-chains seems impossibly complicated.

However, researchers from nine collaborating Australian institutions will establish ground-breaking electronic infrastructure to address this challenge. They will create a virtual “Industrial Ecology Laboratory” that can unravel the complex environmental and economic interactions of modern Australia. This virtual laboratory will dramatically enhance Australia’s analytical capabilities in Life-Cycle Assessment (LCA), carbon footprinting, water footprinting, and other approaches to environmental impact assessment. It will also improve our capacity for modelling the future effects of changes in economic and social policy.

The Industrial Ecology Lab will integrate a diverse set of data streams with a calculation engine that can rapidly react as new information becomes available, and this capability will mark a new era in sustainability research. The Industrial Ecology Laboratory will significantly boost Australia’s ability to make strategic decisions that deliver a more environmentally, socially, and economically sustainable economy.

A number of researchers are already using the Industrial Ecology Lab for their purposes, for example in studies on future biofuel industries for Australia , industrial symbiosis and material efficiency and on waste metal flows. The IE Lab is also collaborating with the Jolliet Lab at the School of Public Health of the University of Michigan, on modeling the environmental health effects of Australian consumption by combining an economic MRIO model with a multiscale fate and exposure model of pollution. For further details on the Industrial Ecology Lab, follow this link.

The Industrial Ecology Lab concept was conceived by Prof Manfred Lenzen, of ISA at the University of Sydney. The constituency of the original Industrial Ecology Lab was established at two meetings, one on Stradbroke Island, Qld, 25-30 April 2012 and one in Bundanoon, NSW, 18-20 February 2013. The IE Lab’s architecture and infrastructure will be developed throughout 2013 under the lead of Prof Manfred Lenzen. From 2014 onwards, the Lab will be operated under the lead of Prof Tommy Wiedmann of the University of New South Wales. The Industrial Ecology Laboratory acknowledges funding from the NeCTAR project. NeCTAR is an Australian Government project conducted as part of the Super Science initiative and financed by the Education Investment Fund.

The project participants are (in alphabetical order)

• Dr Neal Anderson for ICT, at the University of Sydney;
• Prof John Boland for the University of South Australia, Adelaide;
• Dr Peter Daniels for Griffith University, Brisbane;
• Mr Jacob Fry for ISA, the University of Sydney;
• Dr Arne Geschke for ISA, the University of Sydney;
• Dr Steven Kenway for the University of Queensland, Brisbane;
• Mr Joe Lane for the University of Queensland, Brisbane;
• Dr Arunima Malik for ISA, at the University of Sydney;
• Dr Joy Murray for ISA, at the University of Sydney;
• Ms Lavinia Poruschi for Griffith University, Brisbane;
• Mr Christian Reynolds for the University of South Australia, Adelaide;
• Dr Julien Ugon for the University of Ballarat;
• Dr Dean Webb for the University of Ballarat;
• Dr Jim West for the CSIRO, Canberra;
• Dr XXX for Intersect, Sydney, Australia;

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The founding members of the Industrial Ecology Lab. From left to right, top row: Joe Lane, Dean Webb, Julien Ugon, Steve Kenway, Arne Geschke; bottom row: Peter Daniels, Manfred Lenzen, Tommy Wiedmann, Jacob Fry. Missing: John Boland, Christian Reynolds

For further information please contact

Dr Arne Geschke ISA, School of Physics A28 The University of Sydney NSW 2006 +61 (0)2 9036-7505 arne.geschke@sydney.edu.au

Project Reunion

Project Reunion is a collaboration between the top global institutions involved in the compilation of global extended Multi-Region Input-Output (MRIO) databases, with participants from TNO Delft/CML Leiden, the University of Groningen, the OECD, Purdue University, the Institute of Developing Economies of the Japan External Trade Organisation (IDE-JETRO), the Center for International Climate and Environmental Research in Oslo, and the University of Sydney. The goal of Project R�union was to coordinate worldwide activities on environmentally-extended MRIO database compilation.

The idea for this collaboration originated from a meeting of MRIO leaders at the 18^th Input-Output Conference held in 2010 at the University of Sydney. This meeting clearly demonstrated the great opportunities of a world MRIO network for shaping environmental databases, sustainability research and environmental policy around the world. The University of Sydney under its IPDF scheme, as well as IDE-JETRO, provided seed funds in order to enable these leaders in the field to meet three times, and to implement a global collaboration.

The first Project R�union meeting was held in L’Hermitage-les-Bains, R�union Island, 27-29 March 2011. Following this meeting, IDE-JETRO made available funds for a third meeting, which was scheduled ahead of the second R�union meeting, held in Tokyo, Japan, during 30 January – 2 February 2012.

As a first concrete step, Project R�union members agreed, during their third 2013 meeting in Kurokawa Onsen, Kyushu, Japan, to aim at demonstrating the ability to generate, based on unified data pools and construction pipelines, a set of global MRIO databases expressed in the regional and sectoral classifications of some of the prominent MRIO tables existing at the time. In 2013, Project R�union received funding from the Australian Research Council under its Discovery Project DP130101293, in order to undertake a three-year research project entitled “Unifying global approaches to multi-regional input-output analysis and environmental footprinting”.

The participants of Project R�union are (in alphabetical order)

• Prof Erik Dietzenbacher for the WIOD project at the University of Groningen, Netherlands;
• Prof Satoshi Inomata for the Asian IO project at IDE/JETRO, Japan;
• Prof Manfred Lenzen, for the AISHA project at ISA, Sydney University, Australia;
• Prof Bart Los for the WIOD project at the University of Groningen, Netherlands;
• Dr Bo Meng for the Asian IO project at IDE/JETRO, Japan;
• Dr Glen Peters for CICERO, Norway;
• Prof Arnold Tukker for the EXIOPOL project at TNO, Netherlands;
• Prof Terrie Walmsley for the GTAP project at Purdue University, USA;
• Prof Tommy Wiedmann for the University of New South Wales, Australia;
• Dr Norihiko Yamano for the OECD, Paris;

The founding members of the R�union Project. From left to right: Satoshi Inomata, Manfred Lenzen, Tommy Wiedmann, Bart Los, Terrie Walmsley, Arnold Tukker, and Erik Dietzenbacher.

Project R�union was officially closed on 31 March 2017, with the publication of the Special Issue on Virtual Laboratories for collaborative input-output analysis, published in Economic Systems Research as Vol. 29, Issue 2.

In order to demonstrate the capability of the Virtual Laboratory technology to create time series of MRIO tables in flexible regional and sectoral formats, Project R�union has generated a set of MRIO data available for download. Access is by password; first-time users please click here to register. Note that these data sets are preliminary in the sense that they are the first output of the Project’s Global MRIO Laboratory. In a first stage, users are invited to provide observations and constructive suggestions that can be used by the Project R�union team to improve data quality. Depending on user feedback, the opening of the Global MRIO Laboratory for research use is envisaged in a second stage.

For further information please contact

Dr Arne Geschke ISA, School of Physics A28 The University of Sydney NSW 2006 +61 (0)2 9036-7505 arne.geschke@sydney.edu.au

Triple Bottom Line Reporting / Sustainability Reporting

In close collaboration with the NSW Environmental Trust and CSIRO Resource Futures, the ISA™ team at the University of Sydney has developed a quantitative, consistent and comprehensive Triple Bottom Line (TBL) Reporting framework.

At present, this TBL framework is being applied in projects such as:

1. TBL Reporting at the economic-sector level for 135 sectors of the Australian economy (funded by the Federal Department of Environment and Heritage);
2. Triple Bottom Line Accounts for the Fisheries Research & Development Corporation;
3. TBL Report for Wollongong Council and the Wollongong Population (funded by Wollongong Council);
4. Consulting to ANZ Bank on the sustainability performance of their lending portfolio. This work featured in ANZ’s 2006 Corporate Responsibility Report.
5. Businesses on Norfolk Island.

The Sydney University / CSIRO framework addresses seven key issues that define requirements of reporting on Socially Responsible Investment (SRI) and TBL issues:

1. The reporting methods must be reasonably simple in output terms and able to be understood and accepted by company management, investors, government policy, and the general public (see an example of a TBL spider diagram).
2. They should produce indicators that are based on a common unit of understanding (a metric; see an example for a quantitative TBL account).
3. They must be able to be used at a number of spatial levels such as economic sectors, states, councils, cities, companies, or government institutions.
4. While reasonably simple, they must reflect the complexity of modern economic systems and be rigorous enough to meet economic challenge.
5. They should provide a stimulus to management change and innovation (see an example for a Structural Path Analysis).
6. They should be able to report the direct, on-site TBL impacts that exist in the immediate business environment of a particular sector or company, as well as indirect, off-site impacts that account for the intermediate and end-uses of the sectors or companies output throughout the entire downstream supply chain.
7. They should be able to report all indirect, off-site impacts that account for the goods or services obtained from other sectors or companies throughout the entire upstream supply chain (the “boundary problem”).

The TBL Reporting framework developed the Sydney University / CSIRO team therefore has the potential to touch every corner of the modern economy.

For further information, download an article on quantitative TBL.

ISA’s Sustainability Reporting Project

In February 2006, the ISA Group has completed work on a 2-year Sustainability Reporting Pilot Program for organisations, funded by the NSW Environmental Trust. This project has provided a consistent framework within which companies and organisations can undertake Sustainability Reporting using collaboratively defined and relevant indicators and national statistics underpinned by established economic theory. The purpose of this project was to bridge the gap between �hard science� and the real-life issues and needs of people who want to make a difference in the workplace. The project involved

• workshops discussing sustainability in general and reporting of organisations in particular,
• a participatory, iterative development process to improve reporting tools and develop support materials, including workplace trials of TBL Reporting, involving a range of organisations participating in the pilot,
• an internet-based introductory TBL course, and
• an on-line certified TBL course, detailed education material and professional software.

The project thus supports strategic decision making that moves organisations towards sustainability while enhancing social and fiscal performance. Its aim is to establish a milestone on the path towards implementing a standard, quantitative Sustainability Reporting policy that facilitates fair comparisons between organisations, and enables meaningful benchmarking.

For information on this project, contact Dr Joy Murray, +61 (0)2 9351-2627, joy@physics.usyd.edu.au

For further information please contact

Dr Arne Geschke ISA, School of Physics A28 The University of Sydney NSW 2006 +61 (0)2 9036-7505 arne.geschke@sydney.edu.au

Life-Cycle Assessment

The University of Sydney and the Centre for Water and Waste Technology at the University of New South Wales cooperate on developing and applying hybrid Life-Cycle Assessments (LCAs), combining input-output analysis with process analysis. By taking this approach, on-site, first- and second-order process data on environmental impacts is collected for the product or service system under study, while higher-order requirements are covered by input-output analysis.

‘Conventional’ LCAs are based only on process analysis approach, meaning that only on-site, most first-order, and some second-order impacts are considered. However, the truncation of the system boundary leads to a significant underestimation of the true impact (see the boundary problem). Using input-output analysis, the error caused by this truncation can be avoided. A comparative example is given in the table below: Embodied emissions are at least twice as much when comparing the conventional LCA method with the holistic, hybrid input-output analysis approach.

Our LCA projects are commissioned by various stakeholders, such as industry, government agencies, NGOs and research institutions. We have carried out LCA projects have been carried for:

1. Water service providers;
2. Food industry;
3. Manufacturing industry;
4. Waste management;
5. Energy sector and
6. Electronic industry.

We offer:

1. Life Cycle Assessment studies based on hybrid, process and input-output approach depending on the specific needs of the client
2. Life Cycle Costing studies and
3. Life Cycle Engineering studies.

For more information – Contact us for copies of articles on life-cycle assessment of energy supply systems:

• Lenzen M and Wachsmann U, Wind energy converters in Brazil and Germany: an example for geographical variability in LCA, Applied Energy, in press, 2003.
• Lenzen M and Munksgaard J, Energy and CO2 life-cycle analyses of wind turbines � review and applications, Renewable Energy 26 (3), 339-362, 2002.
• Dey C and Lenzen M, Greenhouse gas analysis of electricity generation systems, ANZSES Solar 2000 Conference, Griffith University, Brisbane, Australia, 2000.
• Lenzen M, Greenhouse gas analysis of solar-thermal electricity generation, Solar Energy 65 (6), 353-368, 1999.

For further information please contact

Dr Arne Geschke ISA, School of Physics A28 The University of Sydney NSW 2006 +61 (0)2 9036-7505 arne.geschke@sydney.edu.au

Sustainable Islands program at the University of Sydney

The Sustainable Islands program of the ISA team at the University of Sydney is aimed at identifying the sustainability situation on small and remote Pacific islands. The program originated out of a partnership between ISA and EcoNorfolk on Norfolk Island. So far the program includes participants from Yap, Niue, Pohnpei, Kosrae, Tonga, the Cook Islands, Kiritimati, Tuvalu, Palau, Cocos (Keeling) Islands, Vanuatu, Nauru, Indonesia, and the Comoros (see map at the bottom of this page).

The program has received support under the Australia Awards Fellowships scheme funded through DFAT. The funding enables a training program in sustainable development techniques for leaders of small remote islands. Training programs are conducted at the University of Sydney, Sydney Institute of Marine Science (SIMS) and Norfolk Island. Please download our invitation letter and information for applicants.

The program is coordinated by Dr Joy Murray and Prof Manfred Lenzen of Sydney University’s ISA team. Joy and Manfred also take part in the training. Kerin Wood and Peter Wood work as volunteers in the program.

Shauna Murray is a program trainer at SIMS, and Denise Quintal, Jodie Quintal, and Nicole Diatloff from EcoNorfolk Foundation are program trainers on Norfolk Island.

The program participants are Dr Murukesan Krishnapillai of the College of Micronesia-FSM from Yap Campus in the Federated States of Micronesia, Deveraux Talagi from the Premiers Office of the Niue Government, Cindy Ehmes from the Office of Environment and Emergency Management on Pohnpei in the Federated States of Micronesia, Simpson Abraham from the Office of Pacific Adaptation to Climate Change on Kosrae in the Federated States of Micronesia, June and Andrew Hosking from kia TAERIA on Mauke, Cook Islands, Pelenatita Kara from the Civil Society Forum of Tonga, Alissa Takesy from the Department of Resources and Development of the Government of the Federated States of Micronesia, Christina Fillmed from the Yap State Environmental Protection Agency in the Federated States of Micronesia, Beraina Teirane from the Ministry of Line and Phoenix in Kiribati, Hassane Sambaouma from Agriventures Comoros in the Comoros Islands, Ibrahim Ahamada from the pan-African e-network project in the Comoros Islands, Anitelu Toe’api from the Civil Society Forum of Tonga in Tonga, Mafalu Lotolua from the Power Supply Department in Tuvalu, Motulu Jack Pedro from the Ministry of Foreign Affairs, Tourism, Trade, Environment and Labour in Tuvalu, Sulufaiga Uota from the Ekalesia Kelisiano Tuvalu in Tuvalu, Ratita Bebe from the Kiritimati Island Wildlife & Conservation Unit of the Ministry of Environment, Lands and Agriculture Development on Kiritimati Island in Kiribati, Moutu Barairai from the Ministry of Line and Phoenix Islands Development on Kiritimati Island in Kiribati, Dan Olaf Rasmussen from the National Environment Service in the Cook Islands, Roxanne Blesam from the Environmental Quality Protection Board of Palau, Aana Teetan Berenti from the Kiritimati Island Wildlife & Conservation Unit of the Ministry of Environment, Lands and Agriculture Development on Kiritimati Island in Kiribati, Mei Suciyati from the Institut Lintas Studi on Komodo Island, Indonesia, Basilio Tutai Kaokao from the from the National Environment Service on Mauke in the Cook Islands, Maketara Ioane from the Ministry of Line and Phoenix Islands Development on Kiritimati Island in Kiribati, Hermansyah Akbar from the Canting Exploring Environment Program on Komodo Island in Indonesia, Sean Kadannged from the Tamil Resources Conservation Trust on Yap in the Federated States of Micronesia, Ahohiva Levi from the Legislative Assembly and High Court in Niue, John Wichman, a waste management consultant from Rarotonga in the Cook Islands, Mary McDonald from Te Ipukarea Society in the Cook Islands, Vanessa Lolohea from the National Youth Congress in Tonga, Marie Napip Nickllum from Live and Learn Vanuatu, Peauafi Toe’api from the ‘Anana Community Development in Tonga, and Tyrone Deiye, the representative of the Ijuw Community in the Nauru Government.

Feedback

“… the best training I have ever attended. This training has really opened and changed my way of thinking and my way of looking at life in my country.” – Tyrone Deiye, Nauru

Rationale

Regarding sustainability, most island communities face two major challenges: energy supply and waste disposal. First, most islands do not have indigenous energy resources, but instead have to ship in fuels over often considerable distances, at a considerable financial burden. Second, most islands do not have enough space for operating landfills, so that waste is often burnt under hazardous conditions, with resulting toxic emissions to air. Especially the oil embargos forced many island governments to re-think their energy supply strategies, and to consider introducing renewable energy sources, and efficiency and conservation policies. Similarly, landfill shortage and high energy prices have stimulated debates about waste-to-energy facilities. Amongst the many obstacles preventing new energy and waste technologies to be implemented on remote islands are regulatory, legal and institutional barriers, high upfront capital cost and lack of aid, lack of skills to maintain technically sophisticated facilities, lack of knowledge, especially by policy makers, and inappropriate technology design, small size of the island economies preventing economies of scale for some technologies, and visual obstruction, noise, odour and other community objections.

Outcomes

Our training programs involve an Australia Awards Fellowship. Fellows chosen to receive a Fellowship are expected to be leaders or potential leaders in their field, with the likelihood of making a valuable contribution to their country on their return home. The training assists island communities in addressing the sustainability challenges of: energy supply, waste disposal, and maintaining export industries. Fellows from the Pacific Islands will gain knowledge and practical know-how about

• a) environmental impact assessment and environmental accounting (including carbon footprinting and sustainable living site visits),
• b) management of fisheries resources, marine reserves, and monitoring for ciguatera and other harmful algae (including hands-on microscopy skills),
• c) managing and saving energy and fuel, and managing waste disposal (including site visits showing working, sustainable, and island-friendly solutions), and
• d) governance, planning and administration, grant writing, and strategies for understanding legal and regulatory issues for small islands, including legislative frameworks that guide investigation and implementation of potential sustainable business projects.

We understand that island leaders need to be all-round experts. The training therefore addresses island leaders’ needs through training on a broad selection of relevant issues, and a range of training modes. Our program covers: tailored environmental accounting courses designed for community leaders as well as business and government professionals; guided team work and discussions; practical training in modern fisheries and aquaculture management; and through a practical sustainability training program conducted on Norfolk Island. Here, emphasis is placed on bringing Fellows into dialogue with Norfolk Islanders who are community leaders in implementing alternative energy and waste strategies without any outside assistance. Thus, Fellows can obtain first-hand knowledge about solutions that are suited to island environments and skill pools.

The training program will provide diverse yet sound knowledge needed for communicating and implementing strategies that address energy, waste, pollution and fisheries issues. This knowledge will position Fellows to provide policy advice to their communities and governments. Through witnessing island-based examples of applied local knowledge and self-sufficiency in alternative energy use and waste disposal, Fellows will gain practical experience to complement their existing knowledge.

Further information

A full Triple Bottom Line report on Norfolk Island, and a summary of the 2013 and 2015 training programs on Norfolk Island are available for download. In November 2010, Prof Manfred Lenzen visited Niue in order to plan for a sustainability initiative similar to that realised on Norfolk Island. The visit is documented in a televised interview on Niue TV. ISA thanks Tom Murray for editing the video file.

The location of islands participating in the project.

For further information please contact

Prof Manfred Lenzen ISA, A28 The University of Sydney NSW 2006 +61 (0)2 9351-5985 m.lenzen@physics.usyd.edu.au

Ecological Footprint Analysis

At the University of Sydney, we calculate comprehensive Ecological Footprints for organisations such as companies, government agencies and NGOs, or for cities, states and nations. Our Ecological Footprint projects include:

1. NSW 2006 State of Environment Report;
2. Sydney Water Corporation;
3. the population of Canberra (funded by the Australian Capital Territory’s Office of the Commissioner for Sustainability and the Environment);
4. the population of Victoria (in partnership with EPA Victoria and the Global Footprint Network);
5. the population of Melbourne; published in The Melbourne Atlas (funded by the Port Phillip and Westernport Catchment Management Authority);
6. the population of Victoria (funded by the Department of Sustainability and Environment);
7. the population of Sydney and New South Wales (funded by the Environment Protection Authority NSW);
8. City West Water, South East Water and Melbourne Water Corporation;
9. the Wollongong population and Wollongong Council;
10. Kingfisher Bay Resort, Fraser Island (in collaboration with the University of the Sunshine Coast);
11. CSIRO Sustainable Ecosystems Department;
12. Our own organisation, the School of Physics at the University of Sydney.

Our calculations feature several important issues:

• We can calculate Ecological Footprints based on the original static method, or the new dynamic approach;
• We can calculate complete Ecological Footprints in the sense that they include all impacts from the entire upstream supply chain of an entity: Ecological Footprints without system boundaries;
• We are able to weight different types of land uses according to their real impact on actual Australian land;
• We can decompose the Ecological Footprint into breakdowns of high detail, which are then used for regional and corporate sustainability planning, as published in The Melbourne Atlas
• We can calculate energy land that includes different energy supply and greenhouse mitigation scenarios.
• We can also calculate emissions land, which is due to non-energy-related greenhouse gas emissions, such as from enteric fermentation in livestock, or land clearing. These emissions are particularly important in Australia;

In 2005, ISA entered into a partnership with EcoNorfolk Foundation in order to explore the application of the Ecological Footprint to Norfolk Island.

In July 2003, Sydney Water Corporation, the University of Sydney and the University of New South Wales have started work on a 3-year Linkage Project funded by the Australian Research Council (ARC). This project is aimed at improving the Ecological Footprint methodology, using a Geographical Information System (GIS), regional input-output economics, and dispersion modelling for pollutants, in order to generate an Ecological Footprint framework with high spatial detail and increased number of incorporated processes and indicators.

For information on this project, contact Professor Manfred Lenzen, +61 (0)2 9351 5985, m.lenzen@physics.usyd.edu.au

For further information:

• Contact us for a copy of a journal article on Sydney Water’s Ecological Footprint: Lenzen M, Lundie S, Bransgrove G, Charet L and Sack F, Assessing the ecological footprint of a large metropolitan water supplieris lessons for water management and planning towards sustainability, Journal of Environmental Planning and Management 46 (1), 113-141, 2003.
• Contact us for a copy of a journal article on the Ecological Footprint of our own institution – the School of Physics – and the CSIRO: Wood R and Lenzen M, An application of an improved ecological footprint method and structural path analysis in a comparative institutional study, Local Environment 8 (4), in press, 2003.
• Download an article on recent trends and issues for Ecological Footprints,
• Download a short article on a corporate ecological footprint for Sydney Water,
• A short article on the ecological footprint of Canberra,
• A short article on the ecological footprint of the School of Physics at the University of Sydney,
• An interview on ABC Radio National with Bill Rees, Shauna Murray and Manfred Lenzen on Ecological Footprints,
• A public lecture by Mathis Wackernagel at the Sydney Ideas forum, hosted by the EPA Vic and ISA.

For further information please contact

Dr Arne Geschke ISA, School of Physics A28 The University of Sydney NSW 2006 +61 (0)2 9036-7505 arne.geschke@sydney.edu.au

Environmental Impact Assessment

Environmental Impact Assessment (EIA) is a process covered by several international standards dictating that as many environmental aspects as possible should be identified in a project appraisal.

While these standards stipulate a broad-ranging study, off-site or indirect impacts are not specifically required for an Environmental Impact Statement (EIS). The reasons for this may relate to the perceived difficulty of measuring off-site impacts, or the assumption that these are a relatively insignificant component of the total impact.

In addition to direct effects, developments cause environmental pressure indirectly through the consumption of goods and services, and the activities of the numerous producing industries in the national as well as foreign economies. Indirect effects are of infinite order: in the case of building an airstrip, for example, they not only include environmental pressure exerted by the airstrip itself (impacts on vegetation, wildlife and the physical environment), but also the land occupied by producers of construction machinery, by steel plants producing the steel for the machinery, by mining operations providing the iron ore for the steel factory, by manufacturers of mining equipment, and so on. These impacts are generally off-site, and may even occur in foreign countries. This process of industrial interdependence proceeds infinitely in an upstream direction, through the whole life cycle of all products, like the branches of an infinite tree.

At the Centre of Integratd Sustainability Analysis we have developed and applied a method that uses calculates the indirect effects of a development proposal in terms of a large range of indicator variables. Using this method, it is straightforward to enhance an existing EIS so that the entire supply chain is covered.

As an example, the results of our case study of a Second Sydney Airport show that the total impacts are considerably higher than the on-site impacts for the indicators land disturbance, greenhouse gas emissions, water use, and employment.

The figure above shows a breakdown of the water used, jobs created, land disturbed, and energy used, directly and indirectly, for the construction of a Second Sydney Airport, broken down by production layer. A production layer is a level of suppliers for a development proposal. The horizontal axis of the diagram below shows these production layers. 0 is the site of the proposal itself, 1 are the direct suppliers, 2 are the suppliers of the suppliers, and so on, covering the supply chain in an upstream direction. The vertical axis shows the impacts associated with these production layers. The impact is shown for each production layer, for example zeroth order is on-site jobs or land disturbance, first order is jobs created and land disturbance caused at the suppliers to the airport construction, second order is the jobs created and land disturbance at the suppliers of the suppliers, and so on.

According to the existing EIS, for example, the number of jobs created directly and indirectly is stated as 25,700, with 8,400 jobs needed directly at the airport construction site, and 17,300 in the region. However, our complete impact assessment shows that in total 75,000 jobs are created on-site and nationwide. Similarly, total water use is about 115 gigalitres (GL), which is significantly higher than the 39 GL (used on-site) stated in the existing EIS.

For more information – Contact us for a copy of an article on an extended EIA of the Second Sydney Airport proposal: Lenzen M, Murray S A, Korte B and Dey C J, Environmental impact assessment including indirect effects a case study using input-output analysis, Environmental Impact Assessment Review 23(3), 263-282, 2003.

For further information please contact

Dr Arne Geschke ISA, School of Physics A28 The University of Sydney NSW 2006 +61 (0)2 9036-7505 arne.geschke@sydney.edu.au

Sustainability Research

Many different sustainability indicators have been used in existing Sustainability Reporting schemes such as Triple Bottom Line Reporting or State-of-the-Environment Reporting. The indicators in these schemes relate to environmental impacts that have particular lifetimes. In turn, the ecosystems affected by these impacts exhibit particular dynamics, and may take varying amounts of time to recover or adapt. Generally, organisations or populations have different histories of environmental pressures. In order to achieve fairness and consistency in benchmarking these organisations and populations, Sustainability Reporting should ideally be designed to take into account the differences in time scales of both impacts and the recovery of ecosystems or other aspects of the environment.

Historical responsibility and the lifetimes of environmental impacts could be accounted for by considering impacts as cumulative rather than instantaneous. Long-term, on-going impacts are best described by state rather than pressure indicators. An example of a state indicator is air pollution in a city, while an example of the corresponding pressure indicator is the emission of air pollutants. Some state indicators of environmental pressures, such as climate change and air quality, can only be measured on relatively large spatial scales, respectively global or regional. For example, the contribution of an organisation to climate change cannot be measured directly, but must be determined from the corresponding pressure indicator, in this case the emissions of greenhouse gases that the organisation is responsible for.

In most Sustainability Reporting schemes, pressure indicators are accounted for in a ‘snapshot-like’ manner, and the accounting period, usually annually, is often much shorter than the impact lifetimes. This makes it very difficult to relate the pressure to a corresponding state indicator. As a consequence, the environmental impact of some organisations and populations may not be fully captured, and comparisons and benchmarking are likely to be inconsistent and unfair.

Pressure and state indicators refer only to impacts. A true description of sustainability would also take into account the response of the ecosystem to the pressure, in other words, the time for ecosystem recovery from these impacts. This is dependent on both the severity of the impact and the resilience of the ecosystem. Pressures that cause extremely long-term or permanent impacts could then be accounted for in a different manner to pressures that cause shorter-term disturbance. At present, very few ecological studies have found quantitative and predictive pressure-state-response links that are applicable beyond their respective, mostly small, ecosystems. This is due to the inherent complexity of ecosystems.

Our lack of understanding of ecological processes and responses to disturbance is one of several challenges to the development of a fair, consistent and scientifically rigorous set of methodologies for Sustainability Reporting. As sustainability initiatives begin to be more widely implemented, it is vital that we begin to address these challenges.

The School of Biological Sciences at the University of Sydney is offering a “Sustainability in an Australian Context” course for honours students.

Contact: Dr Joy Murray School of Physics, A28 The University of Sydney NSW 2006 +61 (0)2 9351-2627, j.murray@physics.usyd.edu.au

Industry sector studies

At Sydney University, we carry out impact studies of specific Australian industry sectors in terms of a range of indicators.

Examples for industry sector studies include

• Triple Bottom Line Accounts for 135 sectors of the Australian economy (funded by Environment Australia),
• a comparative impact study of Australian organic and conventional farms,
• backward and forward linkages of Australian industry sectors, and Australian key sectors,
• comparative impact studies of renewable energy technologies,
• a survey of operators in the Australian passenger and freight transport system with regard to energy and greenhouse impacts,
• an embodied-energy framework for the construction industry, in collaboration with the Mobile Architecture & Built Environment Laboratory at Deakin University.

For further information contact us for copies of journal articles on

• Australian industry sector linkages and key sectors: Lenzen M, Environmentally important linkages and key sectors in the Australian economy, Structural Change and Economic Dynamics, 14 (1), 1-34, 2002,
• the renewable energy sector: Lenzen M and Wachsmann U, Wind energy converters in Brazil and Germany: an example for geographical variability in LCA, Applied Energy, in press, 2003; Lenzen M and Munksgaard J, Energy and CO2 life-cycle analyses of wind turbines � review and applications, Renewable Energy 26 (3), 339-362, 2002; Lenzen M, Greenhouse gas analysis of solar-thermal electricity generation, Solar Energy 65 (6), 353-368, 1999,
• embodied energy in the Australian steel sector: Lenzen M and Dey C, Truncation error in embodied energy analyses of basic iron and steel products, Energy 25 (6), 577-585, 2000,
• the Australian transport sector: Lenzen M, Total requirements of energy and greenhouse gases for Australian transport, Transportation Research D 4, 265-290, 1999.

For further information please contact

Dr Arne Geschke ISA, School of Physics A28 The University of Sydney NSW 2006 +61 (0)2 9036-7505 arne.geschke@sydney.edu.au

Population studies

Living means consuming, and consuming causes resource depletion and environmental degradation, but also creation of jobs and income. The consumption habits of people across Australia and the world differ substantially, and so do the associated social, environmental and economic impacts.

At the University of Sydney we have carried out a number of population studies on environmental effects, such as

• the carbon footprint of the UK population, commissioned by Defra UK,
• the Australian Environmental Atlas (co-developed with the Australian Conservation Foundation),
• a comparative study of the energy requirements of the pipulations of Australia, Brazil, Denmark, India, and Japan,
• the ecological footprint of Canberra in 1999 (funded by the Australian Capital Territory’s Chief Minister’s Department),
• the ecological footprint of Victoria in 1999 (funded by the Victorian Department of Sustainability and Environment),
• the ecological footprint of Melbourne in 1999 (funded by the Port Phillip and Westernport Catchment Management Authority),
• the ecological footprint of Wollongong in 1999 (funded by Wollongong Council),
• the ecological footprint of Sydney and NSW in 1994 and 1999 (funded by the EPA NSW for the 2003 State-of-Environment Report),
• the ecological footprint of Far North Queensland in 1999,
• the energy requirements of Sydney in 1999,
• a comparison of energy requirements of the people of Australia, Brazil, Denmark, India and Japan (in collaboration with the Energy Planning Program at the Federal University of Rio de Janeiro, Brazil, the Institute for Economic and Industry Studies in Tokyo, Japan, and AKF Institute of Local Government Studies in Copenhagen, Denmark),
• CO2 emissions from Danish households (in collaboration with AKF Institute of Local Government Studies),
• water used by Australians in 1995 (in collaboration with the CSIRO)
• the ecological footprint and greenhouse gas emissions of Australians in 1995, and
• energy requirements and greenhouse gas emissions of Australians in 1993.

In order to visualise impacts spatially, we are at present drafting an atlas that illustrates the distribution of contributions to social and environmental impacts across the Statistical Subdivisons of the City of Sydney.

Energy requirement (in Gigajoules) per capita for Sydney Statistical Subdivisions

For further information contact us for the following journal articles:

• Lenzen M, Wier M, Cohen C, Hayami H, Pachauri S, and Schaeffer R,A comparative multivariate analysis of household energy requirements in Australia, Brazil, Denmark, India and Japan, Energy 31, 181-207, 2006,
• Cohen C A M J, Lenzen M and Schaeffer R, Energy requirements of households in Brazil, Energy Policy 55, 555-562, 2003,
• Lenzen M, Dey C J and Foran B, Energy requirements of Sydney households, Ecological Economics, 49 (3), 375-399, 2004,
• Lenzen M and Murray S A, A modified ecological footprint method and its application to Australia, Ecological Economics 37 (2), 229-255, 2001,
• Lenzen M and Foran B, An input-output analysis of Australian water usage, Water Policy 3 (4), 321-340, 2001,
• Wier M, Lenzen M, Munksgaard J and Smed S, Effects of household consumption patterns on CO2 requirements, Economic Systems Research 13 (3), 259-274, 2001,
• Lenzen M, Primary energy and greenhouse gases embodied in Australian final consumption: an input-output analysis, Energy Policy 26 (6), 495-506, 1998.

For further information please contact

Dr Arne Geschke ISA, School of Physics A28 The University of Sydney NSW 2006 +61 (0)2 9036-7505 arne.geschke@sydney.edu.au

National Environmental Accounting

Recent international efforts directed at incorporating resources and pollution into traditional National Accounting have resulted in satellite accounts in physical units. These accounts are called NAMEA – National Accounting Matrix including Environmental Accounts.

NAMEAs now exist in a number of European countries such as Denmark, the Netherlands, Germany, the UK, Sweden and Japan. In the last five years, the Australian Bureau of Statistics has published some physical accounts on minerals, energy, greenhouse gases, fish stocks, and water use. These accounts deal mostly with the supply-side (that is producer’s) breakdown of physical resource use. Each account item represents the resource use of industries.

ISA has collaborated with many statistcial agencies, for example the Australian Bureau of Statistics and Defra UK, in order to calculate physical National Accounts from a demand-side (consumer’s) perspective. These accounts represent the resource use for commodities consumed by final consumers such as households, the government, and foreign consumers. Demand-side accounts contain contributions by all industries in the entire upstream supply chain of each commodity.

In 2007, Defra UK has commissioned ISA and the Stockholm Environment Institute to calculate a time series of UK input-output accounts at great industry sector detail, and to derive from these accounts embedded carbon emissions and the UK’s carbon footprint.

Another example is a National Ecological Footprint Account for Australia calculated at the University of Sydney, which is given below. This type of National Account can be calculated for a large range of physical indicators, such as employment, land use, water use and others.

The need for environmentally extended National Accounts is acknowledged by the Australian Bureau of Statistics in the most recent Water Accounts (ABS 2000, p. 3):

�Environmental accounting work is proceeding in many countries in response to national and international recommendations. The United Nations Conference on the Environment and Development in 1992 and the resulting document, Agenda 21, proposes ‘a program to develop national systems of integrated environmental and economic accounting in all countries’ [�].

The System of National Accounts (SNA) supports policy making at a national level, however, historically the methods have had little regard for environmental matters. An important aim of environmental accounting is to assess the environmental sustainability of economic activities and economic growth by quantifying any depletion and degradation of a natural resource. An environmental account provides an information system which links the economic activities and uses of a resource to changes in the natural resource base.

Environmental accounting provides a link with the economy by depicting quantitative information on natural resources that can then be linked to economic data sets such as Australia’s National Accounts. This allows for monitoring of the flow of the resource through the economy.�

For further information contact us for journal articles featuring

• Water Accounting for Australia: Vardon M, Lenzen M, Peevor S, and Creaser M, Water accounting in Australia, Ecological Economics, in press, 2007,
• a Brazilian Social and Environmental Accounting System: Lenzen M and Schaeffer R, Environmental and social accounting for Brazil, Environmental and Resource Economics 27, 201-226, 2003,
• 1994-95 National Land and Greenhouse Gas Accounts: Lenzen M and Murray S A, A modified ecological footprint method and its application to Australia, Ecological Economics 37 (2), 229-255, 2001,
• a 1994-95 National Water Account: Lenzen M and Foran B, An input-output analysis of Australian water usage, Water Policy 3 (4), 321-340, 2001,
• 1992-93 National Energy and Greenhouse Gas Accounts: Lenzen M, Primary energy and greenhouse gases embodied in Australian final consumption: an input-output analysis, Energy Policy 26 (6), 495-506, 1998.

For further information please contact

Dr Arne Geschke ISA, School of Physics A28 The University of Sydney NSW 2006 +61 (0)2 9036-7505 arne.geschke@sydney.edu.au

Economic Systems Research

Research on economic systems and how they are linked with the physical world underpins our approaches to applied fields such as Triple Bottom Line / Sustainability Reporting, Ecological Footprints or Environmental Impact Assessment.

Examples for systems studies include

• International carbon trade flows: In order to achieve equitable reduction targets, international trade has to be taken into account when assessing nations responsibility for abating climate change. Especially for open economies such as Denmark, greenhouse gases embodied in internationally traded commodities can have a considerable influence on the national greenhouse gas responsibility. We have constructed a five-region interindustry model including Denmark, Germany, Sweden and Norway in order to calculate CO₂ multipliers and trade balances. In the case of Denmark, carbon trade feedback between these countries results in a carbon deficit, that is, Denmark imports more carbon than it exports. From a methodological point of view, both the type of model and the degree of aggregation are crucial parameters when calculating CO₂ responsibilities of countries. Considering consumer rather than producer responsibility for carbon emissions could have a major bearing in international negotiations. This study is carried out in collaboration with AKF Institute of Local Government Studies in Copenhagen, Denmark, and funded by the Danish Energy Agency.
• Linkages and key sectors: We have extended traditional work on linkages, fields of influence and structural paths in order to include environmental and natural resource parameters, and developed the theoretical basis for the generalisation of all three concepts. Applying these extended linkage and key sector concepts to recent Australian empirical data on energy consumption, land disturbance, water use, and emissions of greenhouse gases, NO_x and SO₂ reveals the interdependence of industries in the Australian economy in terms of environmental pressure and resource depletion. Grazing industries, electricity generation, metals, chemicals, textiles, meat and dairy products, wholesale and retail, non-residential building, and hospitality exhibit above-average linkages. A considerable part of environmental and resource pressure is also exerted along paths for providing exports. As an example, the figure below shows an economic landscape representing the field of influence of transactions between industries in the Australian economy, in terms of greenhouse gas emissions. Two clusters of strong linkages in greenhouse terms can be identified: Cluster 1 represents emissions caused by land clearing and agriculture that become embodied in products of the food manufacturing sector; Cluster 2 contains energy-related emissions associated with supplies from heavy industries and power plants to other manufacturing sectors. Economic landscape of the Australian economy, in terms of greenhouse gas emissions.
• Upstream convergence and cross-overs in ranking and benchmarking: As impacts propagate in an upstream direction through economic systems, their magnitude diminishes, and the total impact converges to a final value, representing system completeness. There is strong evidence for differential convergence of impacts towards system completeness. This differential convergence can cause cross-overs at second- and higher-order upstream production layers in the ranking of impacts for products, projects or companies (see the example below for the employment impact associated with the alternative options of buying a new car versus car repairs). The exclusion of higher-order upstream impacts can be responsible for these ranking cross-overs going unnoticed. In this case, an incomplete conventional process-type assessment of two alternative products, projects or companies can result in preferences and recommendations to decision-makers that are different from preferences and recommendations concluded from a complete, whole-supply-chain assessment. In order to provide fair comparisons and benchmarking, misleading effects of ranking crossovers have to be detected. This is only possible if the entire upstream supply chain of products, projects or companies is taken into consideration. Convergence of cumulative labour requirements for a A$1,000 expenditure on a new vehicle and on vehicle repairs, in units of employment-hours (emp-h).
• Structural Path Analysis: Methods for TBL Reporting, Ecological Footprints, Life-Cycle Inventories or Environmental Impact Assessment employing input-output analysis have advantages over conventional approaches. A technique called Structural Path Analysis can “unravel” TBL impacts, ecological footprints etc into single contributing supply paths. It gives extensive detail of the impact of a product, process, project, company or sector. It allows investigating the location of impacts within the supply chain. This technique was applied to recent Australian data in order to determine environmentally important input paths in terms of energy consumption, land disturbance, water use, and emissions of greenhouse gases, NO_x, and SO₂, for all Australian industry sectors. Due to the complexity of inter-industrial transactions, up to third-order paths can be top-ranking. The identification of such paths is usually beyond the capability of conventional techniques.
• Uncertainty calculus and error propagation in input-output systems: Conventional process-analysis-type techniques for compiling TBL Reports, Ecological Footprints, Life-Cycle Inventories or Environmental Impact Statements suffer from a truncation error, which is caused by the omission of resource requirements or pollutant releases of higher-order upstream stages of the production process. The magnitude of this truncation error varies with the type of product, process, project, company or sector considered, but can be in the order of 50%. One way to avoid such significant errors is to incorporate input-output analysis into the analysis framework. Using Monte-Carlo simulations, it can be shown than uncertainties of input-output-based assessments are often lower that truncation errors in even extensive, third-order process-type analyses.

For further information contact us for copies of journal articles on

• Linkages and key sectors: Lenzen M, Environmentally important linkages and key sectors in the Australian economy, Structural Change and Economic Dynamics, 14 (1), 1-34, 2002,
• Convergence and crossovers in upstream life-cycle inventories: Lenzen M and Treloar G, Differential convergence of factor requirements towards upstream production stages Implications for life-cycle assessment, Journal of Industrial Ecology 6 (3-4), 137-160, 2002,
• Developing Structural Path Analysis: Lenzen M, A guide for compiling inventories in hybrid LCA: some Australian results, Journal of Cleaner Production, 10, 545-572, 2002,
• Uncertainty calculus and error propagation within input-output systems: Lenzen M, Errors in conventional and input-output-based life-cycle inventories, Journal of Industrial Ecology 4 (4), 127-148, 2001.

For further information please contact

Dr Arne Geschke ISA, School of Physics A28 The University of Sydney NSW 2006 +61 (0)2 9036-7505 arne.geschke@sydney.edu.au

Educational studies and resources

At the University of Sydney, we have developed a comprehensive Personal Greenhouse Gas Calculator that provides a simple yet powerful means to link the global problem of climate change with elements of individual lives. Our greenhouse gas calculator for Australia is available on-line, as a spreadsheet, or as a form. It contains

• a short, easy-to-handle personal budget sheet providing direct feedback through instantaneous budget re-calculation after each change of entry,
• a normative part (equity and sustainability) and a benchmark,
• comparisons and graphical presentations, and
• a short, easy-to-read explanation of the problem and its importance, strategies for action, and a reference for further information.

It has undergone an independent peer review and was “test-run” by non-academic users.

Parts of this Personal Greenhouse Gas Calculator have been incorporated in the game This Is Your Lifestyle, featured on the ABC Science Online / Film Victoria website, PLANETSLAYER. PLANETSLAYER is the world’s first greenhouse site with a sense of humor. Its irreverent content includes the hilarious Adventures of Greena the Worrier Princess, a Greenhouse Calculator that works out what age you should die at so you don’t use more than your fair share of the planet (!?!), Greenhouse Q&As and heaps more.

Sydney University’s Greenhouse Gas Calculator is also included in the New South Wales (NSW) Department of Education and Trainings technology in learning and teaching (TILT) Plus teacher development program. The Technology in Learning and Teaching (TILT) Plus program is a NSW State Labor Government initiative (1999-2003). It builds on the successful TILT program (1995-1999), which won state and federal awards for its training of 15,000 teachers in basic computer skills and classroom uses of computer technology. TILT Plus is being provided for up to 15,000 teachers, school executive and specialist support staff who are more confident in the use of technology. It provides a number of options to support a range of needs. One of these options is the TILT Plus Science program which is available to NSW science teachers, and which contains the Personal Greenhouse Gas Calculator.

For further information

• Contact us for a copy of a journal article on experiences in university teaching about responsibility for climate change: Lenzen M, Dey C and Murray J, A personal approach to teaching about climate change, Australian Journal of Environmental Education 18, 35-45, 2002,
• Contact us for a copy of a journal article on experiences in school teaching about responsibility for climate change: Lenzen M and Murray J, The role of equity and lifestyles in education about climate change: experiences from a large-scale teacher development program, Canadian Journal of Environmental Education 6, 32-51, 2001,
• Contact us for a copy of a journal article on designing comprehensive greenhouse gas calculators: Lenzen M, The importance of goods and services consumption in household greenhouse gas calculators, Ambio 30 (7), 439-442, 2001,
• Contact us for a copy of a journal article on responsibility for climate change, and how Australian education materials neglect some important issues: Lenzen M and Smith S, Teaching responsibility for climate change: three neglected issues, Australian Journal of Environmental Education 15/16, 69-78, 2000, or
• Download an article on responsibility for climate change.

For further information please contact

Dr Arne Geschke ISA, School of Physics A28 The University of Sydney NSW 2006 +61 (0)2 9036-7505 arne.geschke@sydney.edu.au

Ecological Systems

The recognition that both ecology and economics are grounded in common biophysical foundations has a long tradition. This biophysical foundation is represented by the continual interplay of sunlight, photosynthesis, chemical energy, air, soil, water, and organic matter.

Traditionally, both ecology and economics address only non-human and human interdependencies, respectively. Consequently, environmental problems arising out of industrial pollution have been termed �externalities� by economists, even though they are quite internal to the world we depend on. An excellent quote in this respect is probably that of biologist Marston Bates given by Daly (1968):

�Then we come to man and his place in the system of life. We could have left man out, playing the ecological game of �let�s pretend man doesn�t exist�. But this seems as unfair as the corresponding game of the economists, �let�s pretend that nature doesn�t exist�. The economy of nature and ecology of man are inseparable and attempts to separate them are more than misleading, they are dangerous. Man�s destiny is tied to nature�s destiny and the arrogance of the engineering mind does not change this. Man may be a very peculiar animal, but he is still a part of the system of nature.�

Daly also cites work by Alfred Marshall and other authors dating back to the 1920s that contains references to ecological analogies in economics. As of the former, comparisons have been made at varying scales, ranging from individuals, via living ecosystems to animate and inanimate nature (Tab. 1).

Tab. 1: Analogous terms and concepts in physiology/ecology and economics. Notes: ^a atmosphere, hydrosphere, lithosphere, etc.

A number of authors focus on the common feature of organisms and consumers maintaining a thermodynamic disequilibrium (life), or distance from equilibrium (death), by exchanging high-entropy outputs for low-entropy inputs, amongst them Georgescu-Roegen (1971; 1976). This author deplores economists ignoring their environment by assuming the economic process to be �completely circular and self-sustaining�, whereas in reality (according to the Second Law of Thermodynamics) economies are open systems that need to feed on valuable low-entropy resources from their environment (nature, the sun), but irreversibly transform this into valueless high-entropy waste (disorder, heat), thus maintaining constant own entropy throughout at the cost of increasing the entropy of the entire system they are part of.

Georgescu-Roegen (1976, pp. 58-59) distinguishes two low-entropy sources: relatively scarce fossil fuels and relatively abundant solar radiation, and recommends, in view of humanity currently depending on the scarcer source, to shift attention towards the more abundant solar energy. Since in principle neither the earth nor the solar system is thermodynamically closed, an overall (constant-entropy) steady state can be reached neither relying on fossil fuels nor on solar energy, but the more solar energy is used, the lower the rate of terrestrial entropy increase.

The first author to suggest a quantitative input-output-type framework to describe the structure of ecosystems was Hannon (1973), who drew on previous experiences in industrial energy analysis (Hannon 1972; Folk and Hannon 1973) to define production and respiration energy flows between individuals, species or trophic levels, or in general, compartments. Hannon defines system measures such as production and respiration flows, inflows and outflows, and total system throughflow. Finn (1976) and Patten et al. (1976) define further measures of ecosystem structure. The outflow path length, and the inflow path length measure the average number of compartments through which outflow has passed, and through which inflow will pass.

The first suggestion for a combining a compartmental model of the environmental impact of industries with an economic input-output model was made by Cumberland (1966). While this author merely drew attention to the possibility of extending the traditional accounting framework, Isard et al. (1967) and Daly (1968) added mathematical rigour to the formulation, and went even further in that they proposed a module containing interactions within the ecological system in addition to flows between the environment and the economy. Of this work, only Isard and Langford (1971; Isard et al. 1972) have attempted to apply the concept to the real world, using comprehensive regional data. Like Isard and Daly, Ayres and Kneese (1969) recognise the fundamental importance of the material balance principle in formulating an ecological-economic framework. These authors extend Walras� general equilibrium model to mass flows in and out of the environment. A review and critique of these early models is provided by Victor (1972, pp. 25-52).

Dealing with reconciling �ecological� inputs and outputs of the economic system and the condition of material balance, researchers encountered the problem of incommensurability of flows because of their different physical units. This proved to be an obstacle for analytical operations, which was overcome by Leontief and Ford (1970). Early input-output models, such as by Daly (1968) and Isard et al. (1967), incorporated pollution as outputs of industries, assembled in additional columns of the interindustry table, leading to incompatible units and summation problems across rows (see Forssell and Polenske, 1998, p. 92). The solution of Leontief and Ford (1970) to reverse the position of environmental inputs and outputs (ie to assemble generated pollutants as inputs in rows) made this type of model operational.

Daly (1968) gives an input-output representation of a holistic, integrated ecological-economic model (Tab. 2). It shows the purely economic and ecological interactions as well as ecosystem commodities linked to the economy (for example resources, pollution12 etc) and economic commodities linked to the ecosystem (for example economic activity directed towards environmental protection, waste assimilation etc).

Tab. 2: Simple input-output representation of ecology-economy interdependencies (after Daly 1968, p. 401).

At the same time, Isard and coworkers went to great lengths in drawing up detailed multi-regional ecologically-extended input-output frameworks (Tab. 3), adding to the economic commodities surveyed ecological data such as on winter flounder and water use (Isard et al. 1967), cod and phytoplankton (Isard 1969; Isard and Langford 1971), clam/mussel production and the phosphorus cycle (Isard et al. 1972, Ch. 4). The authors demonstrate potential uses of their framework using case studies of developments of a new town with beach facilities (Isard et al. 1967) and a marina (Isard et al. 1972, Ch. 5).

Tab. 3: Isard�s representation of ecology-economy interdependencies (after Isard 1969; Isard and Langford 1971). R = Region.

Since Isard’s pioneering work, the crucial question has been whether the non-human, ecological quadrants in Tabs. 2 and 3 can be determined with sufficient accuracy and detail in order to provide a useful decision-making tool. While a limited range of non-human indicators have been incorporated into economic analysis, uncovering natural interdependencies has been anything but successful.

It is often asserted that not valuing ecosystem services and natural capital adequately (see Costanza et al. 1998) � in other words the ignorance of the environment in economics � has lead to resource depletion, ecosystem overexploitation, and pollution that humanity is faced with today. While this ignorance was possibly nurtured by the unprecedented achievements made during the industrial revolution of the 19 century, which both gave reason for technological optimism as well as had no discernible impact on the practically unlimited environment, in view of the currently growing impact of human activities on the global ecosystem, nature cannot be treated anymore as ceteribus paribus (Daly 1968, p. 399). This is also evident from many pre-1980 publications such as by Georgescu-Roegen (1975), who seems to having had to argue against predominant perceptions of technological optimism. While then the problem of reconciliation of ecology and economy was very much one of awareness, thirty years later it appears to be more one of corresponding action (Kempton 1993; Stokes et al. 1994; Lenzen and Smith 2000).

For further information contact us for the journal article

• Lenzen M, Structural Path Analysis of ecosystem networks, Ecological Modelling, in press, 2006.

For further reading :

• Ayres R.U. and Kneese A.V. (1969). Production, consumption, and externalities. American Economic Review 59, 282-297.
• Converse A.O. (1971). On the extension of input-output analysis to account for environmental externalities. American Economic Review 61, 197-198.
• Costanza R., d’Arge R., de Groot R., Farber S., Grasso M., Hannon B., Limburg K., Naeem S., O’Neill R.V., Paruelo J., Raskin R.G., Sutton P. and van den Belt M. (1998). The value of the world’s ecosystem services and natural capital. Ecological Economics 25, 3-15, 67-72.
• Cumberland J.H. (1966). A regional interindustry model for analysis of development objectives. Papers and Proceedings of the Regional Science Association 17, 61-75.
• Cumberland J.H. and Stram B.N. (1976). Empirical application of input-output models to environmental problems. In: Polenske, K.R. and Skolka, J.V., Eds. Advances in Input-Output Analysis. Ballinger Publishing Co, Cambridge, MA, USA, 365-388.
• Daly H.E. (1968). On economics as a life science. Journal of Political Economy 76, 392-406.
• Finn J.T. (1976). Measures of ecosystem structure and function derived from analysis of flows. Journal of Theoretical Biology 56(2), 363-380.
• Forssell O. (1998). Extending economy-wide models with environment-related parts. Economic Systems Research 10(2), 183-199.
• Forssell O. and Polenske K.R. (1998). Introduction: input-output and the environment. Economic Systems Research 10(2), 91-97.
• F�rsund F.R. (1985). Input-output models, national economic models, and the environment. In: Kneese A.V. and Sweeney J.L., Eds. Handbook of Natural Resource and Energy Economics. North-Holland, Amsterdam, Netherlands, 325-341.
• Georgescu-Roegen N. (1971). The Entropy Law and the Economic Process. Harvard University Press Cambridge, MA, USA.
• Georgescu-Roegen N. (1975). Energy and economic myths. Southern Economic Journal 41(3), 347-381.
• Georgescu-Roegen N. (1976). The entropy law and the economic problem. In: Georgescu-Roegen, N., Ed. Energy and Economic Myths. Pergamon Press Inc, New York, NY, USA, 53-60.
• Hannon B. (1972). System energy and recycling: a study of the beverage industry. Document No. 23, Center for Advanced Computation, University of Illinois, Urbana, IL, USA.
• Hannon B. (1973). The structure of ecosystems. Journal of Theoretical Biology 41(3), 535-546.
• Isard W. (1969). Some notes on the linkage of socio-economic and ecologic systems. Papers and Proceedings of the Regional Science Association 22, 85-96.
• Isard W. (1975). Economic-ecologic conflict and environmental quality. Introduction to Regional Science. Prentice-Hall, Inc, Englewood Cliffs, NJ, USA, 341-371.
• Isard W., Bassett K., Choguill C., Furtado J., Izumita R., Kissin J., Romanoff E., Seyfarth R. and Tatlock R. (1967). On the linkage of socio-economic and ecologic systems. Papers and Proceedings of the Regional Science Association 21, 79-99.
• Isard W., Choguill C.L., Kissin J., Seyfarth R.H., Tatlock R., Bassett K.E., Furtado J.G. and Izumita R.M. (1972). Ecologic-economic analysis for regional development. The Free Press New York, NY, USA.
• Isard W. and Langford T.W. (1971). Some new directions: Environmental quality analysis and standardization. In: Regional Input-Output Study: Recollections, reflections, and Diverse Notes on the Philadelphia Experience. The MIT Press, Cambridge, MA, USA, 203-222.
• Isard W., Van Zele R. and Kaniss P. (1990). Potentials and problems of economic-ecologic models for management of multiregion systems. In: Isard W. and Smith, C. Eds. Practical Methods of Regional Science and Empirical Applications. New York University Press, New York, NY, USA, 218-235.
• Kempton W. (1993). Will public environmental concern lead to action on global warming? Annual Review of Energy and the Environment 18, 217-245.
• Lenzen M. and Smith S. (2000). Teaching responsibility for climate change: three neglected issues. Australian Journal of Environmental Education 15/16, 69-78.
• Leontief W. and Ford D. (1970). Environmental repercussions and the economic structure: an input-output approach. Review of Economics and Statistics 52(3), 262-271.
• Noll R.G. and Trijonis J. (1971). Mass balance, general equilibrium, and environmental externalities. American Economic Review LXI, 730-735.
• Patten B.C., Bosserman R.W., Finn J.T. and Cale W.G. (1976). Propagation of cause in ecosystems. In: Patten B.C., Ed. Systems Analysis and Simulation in Ecology. Academic Press, New York, NY, USA, 457-579.
• Stokes, D., Lindsay A., Marinopoulos J., Treloar A. and Wescott G. (1994). Household carbon dioxide production in relation to the greenhouse effect. Journal of Environmental Management 40, 197-211.
• Victor P.A. (1972). Pollution: Economy and Environment. George Allen & Unwin Ltd London, UK.

For further information please contact

Dr Arne Geschke ISA, School of Physics A28 The University of Sydney NSW 2006 +61 (0)2 9036-7505 arne.geschke@sydney.edu.au