Noritoshi AriyoshiFaculty of Environmental Studies

Nagasaki University

The Development of Japanese NAMEA

International Workshopfor Interactive Analysis on Economy and Environment

Cabinet Office, Government of Japan, 4 March 2006

The Purpose of Accounting isnot Compilation itself

but Application to Policy

2

CONTENTS

1. Overview of Research Activities on Environmental Accounting in Cabinet Office of Japan

2. Japanese SEEA : Outline and the controversial points

3. Japanese NAMEA : Outline, Features, and Indicators

4. Issues for the Future

3

(fiscal year) First Stage (92-94) Second Stage (95-97) Third Stage (98-00) Fourth Stage (01-03) Fifth Stage (04- )Themes Basic Research Trial Estimation Extension Development Application

Subjects Study of handbook of SEEA93Trial estimation

of Japanese SEEAExtension of Japanese SEEA

Developmentof policy-oriented accounting

Application of Japanese NAMEAto policy analysis and

development of Regional NAMEA

1) Adoption of SEEA ver.IV.21) Improvement of precision ofenvironmental data

1) Compilation of waste account

2) Study of estimation methodsfor environmental cost

2) Establishment of estimationmethods for actual and imputedenvironmental costs

2) Re-estimation according tocompilation of EPEA and wasteaccount

3) Design of Japanese accountingframework based on SEEA93

3) Retroactive estimation andrealisation for 1970, 75, 80, 85,90, and 95

3) Traial estimation of imputedenvironmental cost caused byimport

4) First trial estimation for 1985and 1990

4) Compilation of physical table ofimputed environmental costs

4) Re-estimation based ontransition to SNA93

1) Study of EPEA by Eurostat 1) Study of EPEA by SEEA20031) Compilation of other tables ofEPEA

2) First trial estimation of EPEA2) Compilation of Supply and UseTable for EnvironmentalProtection Services

2) Integration of EPEA toJapanese NAMEA

1) Study of original NAMEA bythe Netherlands

1) Integration of EPEA toJapanese NAMEA

2) Design of Japanese NAMEAframework

2) Application of JapaneseNAMEA to policy analysis

3) First trial estimation for 1990,1995 and 20004) Proposal of environmentalefficiency improvement index

1) Preliminary study of ResionalNAMEA2) Pailot study of regional NAMEAfor Hyogo Prefecture

Regional NAMEA

Table 1 Overview of Research Activities on J apanese System for Environmental and Economic Accounting

JapaneseSEEA

Japanese NAMEA(Hybrid Accounting System integrating Environmental Pressures and Economic Activities: HASEPEA)

Japanese EPEA( Environmental Protection Expenditure Account)

4

92 ～ 00: Trial Estimation on Japanese SEEA based on version .2 of UN’s SEEA93*, Ⅳ(maintenance cost approach)

*SEEA is an acronym for System for Integrate Environmental and Economic Accounting.

*See United Nations (1993) for SEEA93

*See United Nations (2003) for SEEA2003

1. Overview of Research Activities on Environmental Accounting in Cabinet Office of Japan (see Table 1)

5

98 ～ 03 ： Trial Estimation of Japanese EPEA*　 based on SERIEE-1994 Version (98-00),and Supply and Use Table for Environmental Protection Services based on Chapter 5 of UN’s SEEA2003* (00 ～ 03)

*EPEA is an acronym for Environmental Protection Expenditure Account

*See Eurostat (1994) and Chapter 5 of United Nations (2003), for EPEA

1. Overview of Research Activities on Environmental Accounting in Cabinet Office of Japan (see Table 1)

(continued)

6

01 ～ 03 ： Design and Trial Estimation on Japanese NAMEA based on original NAMEA* by the Netherlands.

*NAMEA is an acronym for National Accounting Matrix including Environmental Accounts.

*See de Haan M. and S.J. Keuning (1996) and Chap. 2, 4 etc. of United Nations (2003)

1. Overview of Research Activities on Environmental Accounting in Cabinet Office of Japan (see Table 1)

(continued)

7

04 ～ 06:

1) Application of Japanese NAMEA to Policy Analysis (research on interactive analysis on economy and environment)

2) Pilot Study on Regional (Prefectural) NAMEA

1. Overview of Research Activities on Environmental Accounting in Cabinet Office of Japan (see Table 1)

(continued)

8

CONTENTS

1. Overview of Research Activities on Environmental Accounting in Cabinet Office of Japan

2. Japanese SEEA : Outline and the controversial points

3. Japanese NAMEA : Outline, Features, and Indicators

4. Issues for the Future

9

(10 billion yen）

Air Water Soil LandCoaletc.

1 2 3 4 5 6 7 8 9 10 11 12

1 － － 3,122,124.6 1,207,444.2 ・・ ・・ ・・ 1,914,011.1 669.3 － － －

2 406,898.4 347,878.5 140,338.6 135,741.0 ・・ ・・ ・・ 4,597.6 0.0 45,461.6 -40,473.5 24,556.6

3 3,173.8 5,192.4 ・・ － ・・ ・・ ・・ ・・ ・・ ・・ ・・ -1,238.0

4 403,724.6 342,686.1 140,338.6 135,741.0 ・・ ・・ ・・ 4,597.6 0.0 45,461.6 -40,473.5 25,794.6

5 88,442.3 － -88,442.3 -88,442.3 － － － － － － － －

6 3,640.2 1,936.2 5,576.4 -5,575.6 0.0 -2,346.1 -894.6 ・・ -2,333.5 -2.2 ・・ ・・ －

7 2,256.1 1,936.2 4,192.3 -4,192.3 ・・ -2,346.1 -894.6 ・・ -951.6 ・・ ・・ ・・ －

8 1,381.9 ・・ 1,381.9 -1,381.9 0.0 ・・ ・・ ・・ -1,381.9 ・・ ・・ ・・ －

9 2.2 ・・ 2.2 -2.2 ・・ ・・ ・・ ・・ ・・ -2.2 ・・ ・・ －

10 ・・ ・・ ・・ ・・ ・・ ・・ ・・ ・・ ・・ ・・ ・・ ・・ －

11 ・・ ・・ ・・ ・・ ・・ ・・ ・・ ・・ ・・ ・・ ・・ ・・ －

Restoration of natural assets 12 ・・ -18.1 -18.1 18.1 ・・ ・・ 9.2 8.9 ・・ ・・ ・・ ・・ －

13 -774.4 774.4 0.0 － － － － － － － ・・ ・・ －Eco-margin ( Sum of imputedenvironmental costs )

14 -2,865.8 -2,692.4 -5,558.2 － － － － － － － － － －

Net Domestic Product(NDP)

15 429,319.6 － － － － － － － － － － －

Output 16 924,660.3 － － － － － － － － － － －

17 － － 5,920.1 379.1 2,346.1 885.4 -8.9 2,333.5 -15.1 － － －

18 － － -116,346.5 -28,569.2 ・・ ・・ ・・ -87,777.3 ・・ － － －

19 － － 3,058,037.0 1,226,552.8 ・・ ・・ ・・ 1,830,831.4 652.0 － － －

Shift in environmental cost

Use of land, forest etc.

Other reconciliation items

Closing stocks

Depletion of natural assets

Discrep-ancy

Exports Imports

Other use of natural assets

Discharge of residuals

Production(economicactivities)

Finalconsumption

(sectors)

Non-produced assetsNon-financialassets

Producedassets

Effect on global environment

Use of non-produced natural assets

Use of products

Use of produced fixed assets

Notes) This table is a summary of tabel 2.3.1.7-5 of Research Report on Establishment of Integrated Environmental and Economic Accounting by J apan Research Institute,commissioned from Cabinet Office of J apan, 2001. In table, "－" shows a cell which does not exist conceptually, and "・・" shows a cell which cannot estimate.

Table 2 J apanese SEEA (1995) - Summary Table -

Impu

ted

envi

ronm

enta

l cos

ts

Environmentallyadjusted netdomestic product(EDP)

Reconciliation items on accumulation of naturalassets

Goods and services related to environment

Other goods and services

Opening stocks

Imputedenvironmenta

l costs

Sum of imputed environmental costs (－) Sum of deterioration of non-natural＝

Economicindicator

Environmentalindicator(2) What does EDP indicate ?

(3) What kinds of problemsdoes maintenance costapproach cause ?(4) What do imputedenvironmental cost bymaintenance cost approachmean ?

(1) Outline of Japanese SEEA

10

1) It’s based on version .2 (Maintenance Ⅳcost approach) of UN’s SEEA93,

2) Maintenance cost approach is indirect valuation method which evaluates environmental pressure by imputed cost needed if some environmental measure is taken.

(1) Outline of Japanese SEEA

2. Japanese SEEA : an Outline and the Controversial Points

11

3) Maintenance cost approach chooses one of possible environmental measures, and calculates imputed environmental cost as follows:

4) Imputed environmental costs ＝ (maintenance costs / eliminated environmental pressures)× national total of environmental pressures.

5) EDP ＝ NDP － Imputed environmental costs.(EDP: Environmentally adjusted net Domestic Products)

(1) Outline of Japanese SEEA

(continued)

12

1) If NDP has larger growth rate than imputed environmental cost, EDP is increasing while imputed environmental cost is increasing. Therefore, EDP is not adequate indicator for sustainability.

2) We need other indicators such as OECD’s decoupling indicator.

(2) What does EDP indicate?

Does Larger EDP bring more sustainable economy ?

13

1) Choice of environmental measures : Different imputed environmental costs are derived by what kinds of environmental measures are chosen.

2) Zero-emission principle : Imputed environmental costs are calculated from a point of view of zero-emission principle.

(3) What kinds of problems does maintenance cost approach cause?

14

3) Simple calculation by cost-per-elimination: It does not take account of increasing cost caused by increasing volume of elimination.

4) Maintenance cost approach as a model : This approach is a model and different from ordinary data estimation. If imputed environmental costs are actually paid by producers and consumers, various economic data would be affected. ---- Greened economy GDP!　　

From Japanese SEEA to Japanese NAMEA !

(3) What kinds of problems does maintenance cost approach cause?

(continued)

15

1) It gives a sketch of actual environmental cost which producers and consumers have to pay if abatement policy for environmental pressure is actually taken

2) Japanese SEEA using maintenance cost approach is an economic accounting which incorporates the response of producers and consumers to environmental policy.

(4) What do imputed environmental cost calculated by maintenance cost approach

mean ? (I thank Prof. Sakuma for his helpful suggestions)

16

3) It gives an interesting policy analysis to simulate influences on various economic activities when producers and consumers pay actually imputed environmental cost in response to environmental policy.

* See Ariyoshi, Sakuma and Taniguchi, 2006

(4) What do imputed environmental cost calculated by maintenance cost approach

mean ?

(continued)

17

CONTENTS

1. Overview of Research Activities on Environmental Accounting in Cabinet Office of Japan

2. Japanese SEEA : Outline and the controversial points

3. Japanese NAMEA : Outline, Features, and Indicators

4. Issues for the Future

18

Ac

cu

mu

lati

on

to

en

vir

on

me

nt

Disposal of pollutants

Input of natural assets

Decrease in land use

Em

issi

on

of p

ollu

tan

ts

Incr

ea

se in

na

tura

l ase

ts

Incr

ea

se in

lan

d u

ses

Opening stocks Opening stocks

National accounting matrix(on the monetary basis)

Substances accounts

Hidden material flows

Closing stocks Closing stocks

A

BA-B C

ha

ng

es

in n

atu

ral a

sse

ts

Ch

an

ge

s in

lan

d u

se

Environmental problem accounts

Hid

de

n m

ate

ria

l flo

ws

Pol

luta

nt’s

con

trib

utio

n to

env

ironm

enta

l pro

blem

s

C

Environmental indicators

Environmental accounts (on the quantity basis)

Figure 1 Sketch of J apanese NAMEA

D

19

Global

CO

2

Oth

ers

(5)

SO

2

Oth

ers

(2)

T-P

T-N

＆

Was

tew

ater

1 2 3 4 5 6 7 8 9 10a 10b 10c 10d 10e 10f 10g 10h 10i 10j 10k 10l 10m 10n X1 X2 11a 11b 11c 11d 11e 11f 11g 11h 11i 11j 11k 11l

OA 2,885.8 - - - - - 21,371 - - - 4,950 25,370 -

1 434.9 369.8 134.4 55.32 941.5 1,017,275 36,609 775 1,889 490 360 424,8403 369.8 221,424 20 45 143 346 406 35,9934 468.0 -98.0 0.05 370.0 82.6 13.06 -0.2 38.7 44.27 5.1 44.2 -1.0 -40 408 36.4 0 64 0 0 - - - 0 72,841 0 09 47.9 0.0 7.4 11.9 - - - - -

CO2 10a 1,238,699 1,238,699 CO2

Others(5) 10b 36,693 94,246

SO2 10c - 820 820 SO2

Others(2) 10d - 2,032 1,422

T-P＆T-N 10e 0 835 466 T-P & T-N

Wastewater 10f 0 766 17

10g 405,319 55,514 55,514

10h 199 16,813 -199 16,813 -199

10i 18,019 81,241 54,822 -81,241 54,822

10j 87,000 0 -87,000 0 -87,000

10k 5,736 5,883 -5,736 -5,883 -5,736

Agricultural land 10l -40 -40

Others (5) 10m 40 40

Hidden material flows 10n 1,095 2,826 -1,095 -2,826 -1,095

R -92.9 1,332,945 2,242 466 17 55,514 -199 54,822 -87,000 -5,736 -40 40 -1,095

CA 2,829.3 - - - - - 21,172 - - - 4,910 25,380 -

1,00

0to

nnes

-CO

2

1,00

0 t

-N2O

1,00

0 t

-NO

X1,

000t

-SO

2

1,00

0 ｔ

1,00

0 ｔ

1,00

0 ｔ

PJ

1,00

0 ｍ3

1 m

illion

ｍ3

1,00

0 ｔ

1,00

0 ha

1,00

0 ha

1 m

illion

ｔonn

es Unit Unit

1,00

0to

nnes

-CO

2

1,00

0t-S

O2

1,00

0 ｔ

-PO

43-.

1,00

0 ｔ

-PO

43-.

1,00

0

ｔonn

es

PJ 1,00

0

ｍ3

1 m

illion

ｍ3

1,00

0

ｔonn

es

1,00

0ha 1,00

0ha

1 m

illion

ｔonn

es

Note) This is a summary table of the attachment#1-3 of New System of Integrated Environmental and Economic Accounting , Department of National Accounts, Economic and Social Research Institute (ESRI), Cabinet Office ofJ apan, 2004 (http://www.esri.cao.go.jp/jp/sna/kouhyo.html）.

Val

ue a

dded

(ca

tego

ries)

Dis

trib

utio

n & u

se (se

ctor

s)

Tax

es (ta

x ca

tego

ries)

Cap

ital (

sect

ors)

Accumu. To env.

Land

for

hou

sing

Oth

er la

nds

Changes in natural resources

Table 3 J apanese NAMEA (2000) - Summary Table -

Res

t of

the

wor

ld

Fore

sts

(vol

ume)

Environmental problems

Hid

den

mat

eria

l flow

s

Changes inland uses

Was

tew

ater

Was

te

Fore

sts

Ener

gy r

esou

rces

Wat

er

Fish

Gre

enho

use

effec

ts

Regional

Pro

duct

ion

(act

iviti

es)

Aci

dific

atio

n

Eutr

ophi

catio

n

Air

Greenhouse effects Acidification

Oth

rs (5)

Agr

icul

tura

l lam

d

Acc

umul

atio

n of

sub

stan

ces

to t

he e

nviro

nmen

t

Cha

nges

of na

tura

l res

ourc

esin

RO

W c

ause

d by

impo

rt

Substances

Qualityof water

Hid

den

mat

eria

l flow

s

Pollutants Natural resources

Was

te (2)

Land use

Wat

er (w

ater

use

)

Waste(2)

Pollu

tions

Distribution & use (sectors)

Billion Yen

Reconciliation/indicators

Closing Stocks

Subs

tanc

es

Air

Qualityof water

Acidifi-cation

Energy(3)

Unit

Fishery resources(marine products)

Landuse

Forest (volume)

Natu

ral r

esou

rces

Water resources(wateruse)

Value added (categories)

Green-house

Rest of the world

Taxes (tax categories)Capital (sectors)Non-financial assets (kinds)

Fish

ery

reso

urce

s(m

arin

e pr

oduc

ts)

Ener

gy (3)

Final consumption (purposes)Production (activities)Goods & services (products)

Opening stocks

Fina

l con

sum

ptio

n (p

urpo

se)

Account(classification)

Goo

ds &

ser

vice

s (p

rodu

cts)

Non

-fina

ncia

l ass

ets

(kin

ds)

Final disposition of wasteWastewate

Agricultural land

Changes infishery resources

Processing and recycleof pollutants

Exploitation ofdomestic natural

resources

The potential contributions to Global warming, acidification andEutrophication are expressed in GWP, AEQ and EEQ, respectively. Global Warming Potencials (GWP) CO2 1, N2O 310, CH4 21： ： ： Acid Equivalents (AEQ) Nox 0.7, So2 , NH3： ：１ Eutrophication Equivalents (EEQ) P 3.06, N 0.42： ：

Processing of pollutants andexploitationof natural resources

Pressures on natural resources andrestoration of natural resources

Changes in Forests

Chamges inwater esources

Changes innatural

resources

Changes inland use

Contribution to global environmental issues

Contribution to regionalenvironmental issues

Ｂ

Ａ

Nationaleconomy

ROW

Ｃ

Exploitation of ROW'snatural resourcescaused by imports

Hidden material flowsin domestic area

Hidden material flows inROW caused by imports

汚染物質の排出 Changes in land useEmission of pollutants

Restoration of Natural resources

Ａ－Ｂ

Making indicatorsPressures onenvironment

Others

Others

Depletion of energy resources

Others

Hidden material flowsEnvironmental indicators Ｄ

Closing stocks

Opening stocks

Environmental indicators

Monetary flows Material flows : Cells for environmental flow dataareas

: Cells for environmental indicator

20

1) It is based on the original NAMEA* by the Netherlands, estimates for 90, 95, and 00

* NAMEA : National Accounting Matrix including Environmental Accounts.

2) It has twofold parallel structure: national accounting matrix (NAM) at monetary term and environmental accounts (EA) at physical term.

3) It has twofold structure of EA : substance accounts and environmental problem accounts.

3. Japanese NAMEA : Outline, Features, and the Problem

(1) Outline of Japanese NAMEA

21

(2) Features of Japanese NAMEAto original NAMEA

1) It attaches the stock accounts to capital accounts and records the various social capitals and environmental protection plants.

2) It estimates the emission of pollutions not only by households, but also by the government.

3) It introduces the land use accounts.

4) It adds coal, forests, water, and fish to the category of natural resources.

22

(2) Features of Japanese NAMEAto original NAMEA

5) It records the depletion of natural resources in the rest of the world caused by imports.

6) It records the hidden material flows induced by domestic activities and imports.

7) It attaches the stock accounts to parts of the environmental theme accounts. Damage from environment to us is caused by deteriorated environmental assets. See page 11 of my paper

(continued)

23

Global

CO

2

Oth

ers

(5)

SO

2

Oth

ers

(2)

T-P

T-N

＆

Was

tew

ater

1 2 3 4 5 6 7 8 9 10a 10b 10c 10d 10e 10f 10g 10h 10i 10j 10k 10l 10m 10n X1 X2 11a 11b 11c 11d 11e 11f 11g 11h 11i 11j 11k 11l

OA 2,885.8 - - - - - 21,371 - - - 4,950 25,370 -

1 434.9 369.8 134.4 55.32 941.5 1,017,275 36,609 775 1,889 490 360 424,8403 369.8 221,424 20 45 143 346 406 35,9934 468.0 -98.0 0.05 370.0 82.6 13.06 -0.2 38.7 44.27 5.1 44.2 -1.0 -40 408 36.4 0 64 0 0 - - - 0 72,841 0 09 47.9 0.0 7.4 11.9 - - - - -

CO2 10a 1,238,699 1,238,699 CO2

Others(5) 10b 36,693 94,246

SO2 10c - 820 820 SO2

Others(2) 10d - 2,032 1,422

T-P＆T-N 10e 0 835 466 T-P & T-N

Wastewater 10f 0 766 17

10g 405,319 55,514 55,514

10h 199 16,813 -199 16,813 -199

10i 18,019 81,241 54,822 -81,241 54,822

10j 87,000 0 -87,000 0 -87,000

10k 5,736 5,883 -5,736 -5,883 -5,736

Agricultural land 10l -40 -40

Others (5) 10m 40 40

Hidden material flows 10n 1,095 2,826 -1,095 -2,826 -1,095

R -92.9 1,332,945 2,242 466 17 55,514 -199 54,822 -87,000 -5,736 -40 40 -1,095

CA 2,829.3 - - - - - 21,172 - - - 4,910 25,380 -

1,00

0to

nnes

-CO

2

1,00

0 t

-N2O

1,00

0 t

-NO

X1,

000t

-SO

2

1,00

0 ｔ

1,00

0 ｔ

1,00

0 ｔ

PJ

1,00

0 ｍ3

1 m

illion

ｍ3

1,00

0 ｔ

1,00

0 ha

1,00

0 ha

1 m

illion

ｔonn

es Unit Unit

1,00

0to

nnes

-CO

2

1,00

0t-S

O2

1,00

0 ｔ

-PO

43-.

1,00

0 ｔ

-PO

43-.

1,00

0

ｔonn

es

PJ 1,00

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ｍ3

1 m

illion

ｍ3

1,00

0

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1,00

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1 m

illion

ｔonn

es

Note) This is a summary table of the attachment#1-3 of New System of Integrated Environmental and Economic Accounting , Department of National Accounts, Economic and Social Research Institute (ESRI), Cabinet Office ofJ apan, 2004 (http://www.esri.cao.go.jp/jp/sna/kouhyo.html）.

Val

ue a

dded

(ca

tego

ries)

Dis

trib

utio

n & u

se (se

ctor

s)

Tax

es (ta

x ca

tego

ries)

Cap

ital (

sect

ors)

Accumu. To env.

Land

for

hou

sing

Oth

er la

nds

Changes in natural resources

Table 3 J apanese NAMEA (2000) - Summary Table -

Res

t of

the

wor

ld

Fore

sts

(vol

ume)

Environmental problems

Hid

den

mat

eria

l flow

s

Changes inland uses

Was

tew

ater

Was

te

Fore

sts

Ener

gy r

esou

rces

Wat

er

Fish

Gre

enho

use

effec

ts

Regional

Pro

duct

ion

(act

iviti

es)

Aci

dific

atio

n

Eutr

ophi

catio

n

Air

Greenhouse effects Acidification

Oth

rs (5)

Agr

icul

tura

l lam

d

Acc

umul

atio

n of

sub

stan

ces

to t

he e

nviro

nmen

t

Cha

nges

of na

tura

l res

ourc

esin

RO

W c

ause

d by

impo

rt

Substances

Qualityof water

Hid

den

mat

eria

l flow

s

Pollutants Natural resources

Was

te (2)

Land use

Wat

er (w

ater

use

)

Waste(2)

Pollu

tions

Distribution & use (sectors)

Billion Yen

Reconciliation/indicators

Closing Stocks

Subs

tanc

es

Air

Qualityof water

Acidifi-cation

Energy(3)

Unit

Fishery resources(marine products)

Landuse

Forest (volume)

Natu

ral r

esou

rces

Water resources(wateruse)

Value added (categories)

Green-house

Rest of the world

Taxes (tax categories)Capital (sectors)Non-financial assets (kinds)

Fish

ery

reso

urce

s(m

arin

e pr

oduc

ts)

Ener

gy (3)

Final consumption (purposes)Production (activities)Goods & services (products)

Opening stocks

Fina

l con

sum

ptio

n (p

urpo

se)

Account(classification)

Goo

ds &

ser

vice

s (p

rodu

cts)

Non

-fina

ncia

l ass

ets

(kin

ds)

Final disposition of wasteWastewate

Agricultural land

Changes infishery resources

Processing and recycleof pollutants

Exploitation ofdomestic natural

resources

The potential contributions to Global warming, acidification andEutrophication are expressed in GWP, AEQ and EEQ, respectively. Global Warming Potencials (GWP) CO2 1, N2O 310, CH4 21： ： ： Acid Equivalents (AEQ) Nox 0.7, So2 , NH3： ：１ Eutrophication Equivalents (EEQ) P 3.06, N 0.42： ：

Processing of pollutants andexploitationof natural resources

Pressures on natural resources andrestoration of natural resources

Changes in Forests

Chamges inwater esources

Changes innatural

resources

Changes inland use

Contribution to global environmental issues

Contribution to regionalenvironmental issues

Ｂ

Ａ

Nationaleconomy

ROW

Ｃ

Exploitation of ROW'snatural resourcescaused by imports

Hidden material flowsin domestic area

Hidden material flows inROW caused by imports

汚染物質の排出 Changes in land useEmission of pollutants

Restoration of Natural resources

Ａ－Ｂ

Making indicatorsPressures onenvironment

Others

Others

Depletion of energy resources

Others

Hidden material flowsEnvironmental indicators Ｄ

Closing stocks

Opening stocks

Environmental indicators

Monetary flows Material flows : Cells for environmental flow dataareas

: Cells for environmental indicator

1) Stock accounts 7) Stock accounts 3) Land use accounts

4) Natural resources accounts

5) Depletion by imports

2) Emission of pollution by household and government

6) Hidden material flows

Features of Japanese NAMEA to original NAMEA

24

1) Global warming (CO2: approximate estimate)1) Unit 1990 1995 2000Growth rate

（95/90）Growth rate

（00/95）Growth rate

（00/90）Output \ 1 billion 859,688.1 922,938.0 941,518.8 7.4 2.0 9.5 Notes:Final consumption \ 1 billion 291,161.4 349,633.2 369,769.5 20.1 5.8 27.0

Production activities 1,000 tonnes (CO2) 959,805 1,015,987 1,017,275 5.9 0.1 6.01 tonne (CO2)/\ 100 million 111.6 110.1 108.0 (1.4) (1.8) (3.2)

Final consumption 1,000 tonnes (CO2) 162,312 194,921 221,424 20.1 13.6 36.41 tonne (CO2)/\ 100 million 55.7 55.8 59.9 0.0 7.4 7.4

Pollutants (air/water pollution)2) Unit 1990 1995 2000Growth rate

（95/90）Growth rate

（00/95）Growth rate

（00/90）1,000 tonnes(CO2) 1,187,050 1,323,288 1,332,945 11.5 0.7 12.31,000 tonnes (SO2) 2,388 2,407 2,242 0.8 (6.9) (6.1)1,000 tonnes (PO43-) 556 539 483 (3.0) (10.4) (13.1)

Eutrophication （T-P, T-N） 1,000 tonnes (PO43-) 534 521 466 (2.6) (10.4) (12.8)

Waste disposal Unit 1990 1995 2000Growth rate

（95/90）Growth rate

（00/95）Growth rate

（00/90）Waste disposal (final disposal volume) 1,000 tonnes 105,810 82,602 55,514 (21.9) (32.8) (47.5)

1,000 tonnes 153,669 152,185 191,860 (1.0) 26.1 24.9

Natural resources extracted Unit 1990 1995 2000Growth rate

（95/90）Growth rate

（00/95）Growth rate

（00/90）Overseas natural resources extracted due to imports

Energy PJ 14,297 16,246 16,813 13.6 3.5 17.6Forest1) 1,000m3 81,793 89,015 81,241 8.8 (8.7) (0.7)

Domestic natural resources extractedEnergy PJ 370 279 199 (24.5) (28.8) (46.2)Forest1) 1,000m3 29,367 22,915 18,019 (22.0) (21.4) (38.6)

1) A forest usually absorbs more volumeof CO2 in the growth period than in themature period. However, the researchteam did not evaluate the fluctuation inforest CO2 absorption capacity becausethere is much uncertainty. If any reliablecalculation result becomes available inthe future, it will be incorporated in theabove tables.2)The research team employedapplicable conversion coefficients in orderto grasp pollutant's contribution toenvironmental problems.

Table 4 Trends of Major Environmental Pollutants based on J apanese NAMEA

Water quality-related substances (T-P, T-N, wastewater)Acidification gases （NOx, SO

２）

Greenhouse gases （CO2, N2O, CH4, HFCS, PFCS, SF6）

CO2 Emission level vs. output

Emission level vs. final consumption

Source)

Total recycled volume

This table is reprinted from Table 3 of New System of Integrated Environmental and Economic Accounting, Department of National Accounts, Economic and Social Research Institute (ESRI), Cabinet Office of Japan,2004 (http://www.esri.cao.go.jp/jp/sna/kouhyo.html）.

25

(3) Remarks on Japanese NAMEA

1) EA (environmental accounts) part of NAMEA is recorded in physical term. Therefore, it includes no problems on monetary valuation.

2) Does EA give sufficient information to make environmental policy? In order to adequately understand environmental problems and those priority and to make environmental policy, is it unnecessary to estimate the monetary costs to eliminate environmental pressures and the monetary damage cost caused by environmental pressures?

26

(3) Remarks on Japanese NAMEA

2) (continued) For example, Physical data on the environmental pressure not necessarily represent the seriousness of the environmental issue. ----- See page 12 of my paper

3) It would be important to have both physical and monetary environmental data

(continued)

27

EP: Environmental Pressures

DF: Driving Forces ( ex. GDP )

Closing DF／ Opening DF

Closing EP／ Opening EP ) X 100EEII ＝（１

－

EEII 0≧ EP’s growth rate DF’s growth rate ⇒ ≦”Environmental efficiency is ⇒ improving”

EEII＜ 0 EP’s growth rate ⇒ ＞ DF’s growth rate ”Environmental efficiency is ⇒ deteriorating”

(4) Environmental Efficiency Improvement Index (EEII)

28

Glasshouse effect Acidification Eutrophication Waste Residential areaspace

Urban area space

1990-1995 -3.4% 6.5% 9.5% 27.6% 2.1% -0.5%1995-2000 6.0% 13.1% 16.5% 37.3% 1.8% 0.3%1990-2000 2.8% 18.7% 24.5% 54.6% 3.8% -0.2%

Environmental efficiency improvement index (EEII)

Table 6 Trends of EEII based on J apanese NAMEA

1990-1995 1995-2000 1990-2000

0 0

Impr

ovem

ent

in e

nviro

nmen

tal e

fficie

ncy

Glasshouseeffect

Acidification Eutrophication Waste Residential areaspace

Urban areaspace

Det

erior

atio

nin

env

ironm

enta

l effi

cienc

y

20

20

40

60 (%)

29

(5) Remarks on EEII

1) EEII represents the relationship between economic activities and environmental pressures .

2) OECD calls this type of index "decoupling indicator."

3) EEII does not represent strong sustainability because environmental pressures may be larger than sustainable flow level even if environmental efficiency is improving.

30

(5) Remarks on EEII

4) EEII is flow indicator and not stock indicator. Stock of EP (environmental pressures) is increasing as long as EP occurs every year, even if EP’s growth rate is on the downward trend ( EEII is on the upward trend) year by year.

5) Therefore, the stock of EP probably increases over the sustainable stock level of EP. EEII is efficiency indicator, not necessarily adequate indicator for sustainability.

(continued)

31

(6) Hicks’ Income and Indicator for Sustainability

1) Hicks’ Income is a maximum of weekly outlay which the economic situation at week beginning can be still sustained at the week end. It is ex-ante concept and give a guideline for prudent behavior.

2) Hicks’ Income suggests, as a sustainable indicator, a maximum of National Income which the environmental stocks at beginning of year can be still sustained at end of year.

32

(6) Hicks’ Income and Indicator for Sustainability

3) Can we calculate, at beginning of the year, a maximum use of environmental stocks as a sink of pollutants and as a source of natural resources which the environmental stocks at beginning of year can be still sustained at end of year?

4) Use of environmental stocks is a debt for environmental stocks. We have to use environmental stocks according to plan, as same as financing (borrowing and repaying) on bank

(continued)

33

CONTENTS

1. Overview of Research Activities on Environmental Accounting in Cabinet Office of Japan

2. Japanese SEEA : Outline and the controversial points

3. Japanese NAMEA : Outline, Features, and Indicators

4. Issues for the Future

34

4. Issues for the future

1) Further improvements of the precision of estimation on Japanese NAMEA.

2) Development of regional version of Japanese NAMEA. Pilot study of Regional NAMEA starts from 2005.

3) Development of stock indicators which represent strong sustainability.

4) Application of Japanese NAMEA to policy analysis. Purpose of Japanese NAMEA is not compilation itself but application to policy.

35

International exchange of information and experiences is extremely useful.

In this respect, I would extend my best thanks to the ESRI and JRI (Japan Research Institute) for organizing this workshop and giving me the opportunity of this presentation.

Closing remarks