An Introductory Note on the Environmental Economics of the Circular Economy

This paper provides an introduction to some of the fundamental principles and approaches in envi- ronmental economics which are of significance to achieving an integrated sustainability science The concept of a circular economy introduced by the late David Pearce in 1990 addresses the interlink ages of the four economic functions of the environment The environment not only provides amenity values in addition to being a resource base and a sink for eco- nomic activities it is also a fundamental life-support system Environmental economists have suggested that taking these four functions as an analytical start- ing point unpriced or underpriced services should be internalised in the economy In Europe significant ad- vances have been achieved in the pricing of externali- ties by means of truly interdisciplinary analysis which accounts in detail for the environmental consequences The monetary estimates reached as a result of such interdisciplinary research are gradually being applied to the economic analysis of environmental policy pri- orities Although such figures provide only a partial and incomplete picture of the environmental costs at stake they support and inform the analysis of the virtues of a circular economy for individual resources as well as for sustainability as a future trajector

Europe’s experience with carbon-energy taxation

The COMETR project is a comprehensive attempt to account ex-post for the implications of carbon-energy taxation, taking into account differences in sectoral tax burdens and within a suitable macro-economic framework capable of providing an overall assessment, the E3ME model of Cambridge Econometrics. The results indicate reductions in greenhouse gas emissions for six member states as a result of carbon-energy taxation under revenue-neutral environmental tax reform (ETR). These effects are mirrored by reductions in total fuel consumption, with the largest reductions occurring in countries with the highest tax rates. Accordingly, the European environmental tax reforms had by 2004 caused reductions in greenhouse gas emissions of 3.1% on average for the six member countries examined, with the largest fall recorded for Finland (5.9%). E3ME-results also suggest that ETR-countries did not experience marked impacts on economic growth (GDP). There was a negative effect for energy-intensive industries but due to many exemptions the burden has remained modest and, where revenues have been recycled to lower employers’ costs for social security contributions, generally below 2% of gross operating surplus

Implications of Denmark\u27s Water Price Reform for Reverine and Coastal Surface Water Quality

Article 9 of the EU’s Water Framework Directive suggests that Member States should provide “adequate incentives” for efficient use of water resources. Although the Directive is mainly about protecting the ecological quality of water bodies, control of quantity serves as an “ancillary element” in delivering on the objectives. Despite their financial difficulties, Member States have been slow to bring their policies on water pricing up to the wording and 2010 deadline of the Directive’s article 9. This Article explores the significance of water pricing reform for the ecological quality objectives for surface waters and, as a stepping stone in this analysis, for water resource efficiency. It does so with a catchment-based analysis of implications from water pricing reform introduced in the early 1990s in Denmark. Household water use is found to have been 50% higher per capita before the reform, which introduced full-cost pricing and a water supply tax. Good data availability for the catchment allows the analysis to demonstrate estimates for the improvements in water flows as well as for a specific water quality parameter. Despite the significant reduction in water demand, the main river is affected only at the margin. For smaller streams and brooks, however, there are more notable impacts for water quality and with potential benefits for rare species dependent on clean waters. A small reduction in emission loadings to coastal waters has comparatively high economic value. The Article finds that water pricing has an important role to play for future management

30.000 ways to reach 55% decarbonization of the European electricity sector

Climate change mitigation is a global challenge that, however, needs to be resolved by national-level authorities, resembling a tragedy of the commons. This paradox is reflected at European scale, as climate commitments are made by the EU collectively, but implementation is the responsibility of individual Member States. Here, we investigate 30.000 near-optimal effort-sharing scenarios where the European electricity sector is decarbonized by at least 55% relative to 1990, in line with 2030 ambitions. Using a highly detailed brownfield electricity system optimization model, the optimal electricity system is simulated for a suite of effort-sharing scenarios. Results reveal large inequalities in the efforts required to decarbonize national electricity sectors, with some countries facing cost-optimal pathways to reach 55% emission reductions, while others are confronted with relatively high abatement costs. Specifically, we find that several countries with modest or low levels of GDP per capita will experience high abatement costs, and when passed over into electricity prices this may lead to increased energy poverty in certain parts of Europ

Promise and performance of agricultural nutrient management policy : Lessons from the Baltic Sea

Following decades of international collaboration to restore the Baltic Sea, we provide an assessment of the domestic implementation of measures agreed to limit diffuse agricultural pollution and the patterns of policy instruments applied. Despite the Helsinki Convention being unusually specific in detailing what measures countries should introduce, we find many shortcomings. These are most pronounced in the larger countries (Poland, Germany and Russia), while smaller countries perform better, notably Sweden and Estonia. The patterns of policy instruments applied differ, influenced by domestic politics. The limited use of complementary policy instruments suggests that other priorities overrule full and effective implementation, with engagement mirroring the advantages that a restored Baltic Sea can bring to countries. Using the European Agricultural Fund for Rural Development to support farmers in managing nutrients, particularly advisory services and investments in modern manure management technologies, represents a significant opportunity for reducing agricultural pollution in most countries

External costs of atmospheric Pb emissions: valuation of neurotoxic impacts due to inhalation

<p>Abstract</p> <p>Background</p> <p>The Impact Pathway Approach (IPA) is an innovative methodology to establish links between emissions, related impacts and monetary estimates. Only few attempts have so far been presented regarding emissions of metals; in this study the external costs of airborne lead (Pb) emissions are assessed using the IPA. Exposure to Pb is known to provoke impacts especially on children's cognition. As cognitive abilities (measured as IQ, intelligence quotient) are known to have implications for lifetime income, a pathway can be established leading from figures for Pb emissions to the implied loss in earnings, and on this basis damage costs per unit of Pb emission can be assessed.</p> <p>Methods</p> <p>Different types of models are here linked. It is relatively straightforward to establish the relationship between Pb emissions and consequent increase in air-Pb concentration, by means of a Gaussian plume dispersion model (OML). The exposed population can then be modelled by linking the OML-output to population data nested in geo-referenced grid cells. Less straightforward is to establish the relationship between exposure to air-Pb concentrations and the resulting blood-Pb concentration. Here an Age-Dependent Biokinetic Model (ADBM) for Pb is applied. On basis of previous research which established links between increases in blood-Pb concentrations during childhood and resulting IQ-loss we arrive at our results.</p> <p>Results</p> <p>External costs of Pb airborne emissions, even at low doses, in our site are in the range of 41-83 €/kg emitted Pb, depending on the considered meteorological year. This estimate applies only to the initial effects of air-Pb, as our study does not address the effects due to the Pb environmental-accumulation and to the subsequent Pb re-exposure. These are likely to be between one and two orders of magnitude higher.</p> <p>Conclusions</p> <p>Biokinetic modelling is a novel tool not previously included when applying the IPA to explore impacts of Pb emissions and related external costs; it allows for more fine-tuned, age-dependent figures for the external costs from low-dose exposure. Valuation of additional health effects and impacts e.g. due to exposure via ingestion appear to be feasible when extending the insights from the present pilot study.</p

Erik Sepstrup Jensen, Økologi og økonomi - et spørgsmål om værdi, København: Jurist- og Økonomforbundets forlag, 1995, 244 s.

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Coase-Pigou kontroversen

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Challenges facing the USA in matching Germany on advanced manufacturing for green growth

This study explores the relative strength of public policies promoting advanced manufacturing by comparing the government programs and capacities of two world leaders in science and technology: the USA and Germany. Based on insights from 'varieties-of-capitalism' literature and using process tracing methodology, this study identifies significant differences in today's pursuit of advanced manufacturing. The German model of Rhine capitalism has strength due to its long tradition of diversified quality work, built on a long-term commitment to government-industry collaboration, with significant indirect public support provided by vocational training and research institutes. The American model of Manchester capitalism has been challenged by the loss of millions of low-skilled manufacturing jobs due to outsourcing and competition from Asia. The study finds that the “Manufacturing USA” policy initiative of the Obama era, although directly inspired by Germany's Fraunhofer institutes, is hampered by the contextual and institutional circumstances identified. With biobased carbon fibers offering the potential of a novel, low-cost material, pursued with research and development (R&D) efforts in both countries, it provides a measure for evaluating policy outcomes, and the study confirms Germany's technological lead. In addition, the study's process-tracing methodology reveals that significant legacies from German knowledge creation in the past have spilled over to American science and technology, and may continue to do so, lured by government funds. Further studies on advanced manufacturing should test the robustness of these findings

Grøn vækst: et nyt spor mellem misvækst og nulvækst

Frem mod miljøtopmødet ‘Rio+20’ i juni 2012 satte Verdensbanken, OECD og FN’s Miljøprogram, UNEP, fokus på ‘grøn økonomi’ og ‘grøn vækst’ som svar på de globale udfordringer, ikke blot med hensyn til at nå frem til en forpligtende international klimaaftale ‘post-Copenhagen’, men især for at formulere en ny modus vivendi for verdensøkonomien i lyset af den omsiggribende fi nanskrise