Eco-Efficiency is defined as the key element for driving major changes in the way we consume and use resources. For over 30 years now it is linked to business and sustainable development methods. It encourages businesses to contribute to greener future and thus pursuit long-term profits.
Since then, hundreds of companies introduced sustainability and eco-efficiency concepts driving the economic and environmental improvements. It mainly focuses on more efficient use of resources and lower pollution. It aims to minimise the use of resources, as well as improving productivity and controlling of waste.
Beyond the production
But eco-efficiency should also be applied beyond the business sectors. It can be applied to cities, regions and whole economies. The concept has been spread wider in recent years with the development of eco-efficiency indicators to measure the status in the economy. This helps the governments and policy-makers respond to environmental and economical challenges.
Governments want to measure their performance in the context of public eco-efficiency. The eco-efficiency indicators allow to measure eco-efficiency in different sectors within the country, benchmark and compare with other countries, track trends and identify opportunities for improvements. The indicators used on the business level (micro-level) can be applied to a country level (macro-level) to improve the overall performance of the economy.
In business sectors most indicators focus however on consumption of raw materials, energy and water as well as the emission of greenhouse gasses, waste and pollution. Companies also integrate eco-efficiency principles within their product development and marketing activities.
Challenges ahead
Adopting the eco-efficiency of the economy-wide level, setting up measurable indicators and track trends become a challenging task. Policy-makers tend to prefer aggregate index to assess their performance in comparison with other countries, however this approach gains criticism. It is said, that it is subject to subjectivity based on the correct economic situation of the country. This is making it less comparable as different variables of the economy will make an impact on the performance results. Therefore, presenting and comparing the information in an index comes with a risk of the importance of the eco-efficiency message and impact the policy making. The indicators should be set a way, to give the countries a clear direction for the economic growth with less pollution and materials use.
This is the reason why eco-efficiency indicators need to present linkage between the economic activity, resource use and environmental impact to help the policies to be more effective. The indicators are also to be flexible and adaptable, relevant to the environmental impact and structure of the economy.
Any risks?
When selecting the indicators the main consideration would be to reflect the sustainability challenges faced in relation to the country economy. Additionally, taking the structure of the economy into account is imperative. For example least developed, developing and developed economies. Which can further can be divided into highly industrial, agricultural, public sector, private sector and transport. The uniqueness of the region is to be taken into account. This will not only encourage growth but also allows to compare the performance in more realistic way.
Another aspect to consider is the methodology and data availability limitations. Many economies struggle with producing quality data. The data should be reliable, there indicators should come with relevant methodological guides for assessing their quality over time.
Testing the waters
The application of such indicators have been tested in several countries already: China, Korea, Japan, Mongolia, Russia. The runs determined limitations due to different level of economic development, structure and natural resource availability, therefore the comparative analysis cannot clearly determine the level of eco-efficiency. However, the tests prove the improvement of eco-efficiency.
Te following indicators have been used:\
1) Energy use intensity - ratio of energy use to GDP
2) Electric power consumption intensity - ratio of power consumption to GDP
3) Environmental impact intensity - direct resource use Emissions from production and consumption of goods and waste generation)
4) Municipal waste intensity - ratio of waste to GDP
These were also generated for selected sectors; transport, private sector, public sector, industrial and agricultural, forestry and fishing.
The study brings to light several indicators. One of them is that decreasing production costs and increasing production efficiency help to reduce environmental impacts. In some countries intensities of some raw materials and fuel increased over time. This has driven measures for the future to improve the efficiencies. The countries can enact policies for improvements to resource use and technological progress.
Conclusions
These studies suggest that single index aggregating trends can not meet the desired outcomes of the eco-efficiency improvement on the wider economic level. The simple indicators developed can guide the policy-makers to tackle issues regarding eco-efficiency in the economy. The indicators need to be flexible and developed for economies to choose the most relevant ones. The indicators however, need to capture the link between economic activity, environmental impact and resource use. The indicators should come with guides on the data gathering to enable comparability of reliable data. The process also showed for improving data systems and human capacity for analysis.
Bibliography:
United Nations Economic and Social Commission for Asia and the Pacific, 2009 Eco-efficiency indicators: Measuring Resource use efficiency and the Impact of Economic Activities on the Environment, Greening of Economic Growth Series, United Nations Publication
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