Material Flow Accounting Tools and its contribution for policy making

1. Technology, Management & Policy Graduate ConsortiumAnnual MeetingJune 26-28Massachusetts Institute of TechnologyCambridge, MA Material Flow Accounting Tools and its contribution for policy making Samuel Niza IN+, IST * Phd fellow of the Science and Technology Foundation, Portugal

2. Summary • MFA, physical accounting and Integrated Environmental and Economic Accounting • MFA use for policy making • MFA and policy making in Portugal • Conclusions

3. Measuring the material demand of the economy LCA – Life Cycle Analysis MIPS – Material Input per Unit of Service Company-level MFA (Eco-balance, Eco-audits, materials accounting)MFA related methods SFA – Substance Flow Analysis EW-MFA - Economy-wide Material Flow Analysis PIOT – Physical Input-Output Tables EIO-LCA – Environmental Input-Output-based Input/Output related methods Life Cycle Assessment Ecological Footprint Environmental Space Carrying capacity related methods Sustainable Process Index NAMEA – National Accounting Matrix including Environmental AccountsIntegrated methods SEEA – System of Integrated Environmental and Economic Accounting

4. Physical and economical accounting techniques Adapted from Daniels and Moore, 2002

5. Economy Metabolism Economy-wide MF balances show: • The composition of the material throughput • The dependence on imports • The physical growth of infrastructures • The quantities of materials released to the environment …and allows static and dynamic evaluation

6. Economy Metabolism Other than MFA economy-wide acounts: • NAMEA and SEEA require enormous quantities of data ⇒ long longlol~long long time lags in data collection and tables preparation • PIOT and EIO-LCA usually have a restricted coverage of physical inputs and outputs (better suited for sector or activity fields’ IO description) • NAMEA, PIOT and EIO-LCA do not account physical stocks • Just permit static models of the economy

7. MFA limitations • Not directly correlated with economic data • Does not directly allocates material flows to sectors

8. Specific characteristics of MFA for policy purposes • Derive material flows indicators • Information/Awareness raising about environmental problems • Monitor the environmental pressure of the economy • Measure the economy metabolism performance

9. Source: Canas, MOSUS, EUROSTAT DMI, Portugal (1960-2000) Portugal, Metabolic performance trends a) material consumption

10. Portugal, Metabolic performance trendsb) wastes and emissions

11. Portugal, Metabolism snapshot Source: Niza & Ferrão calculations Portugal physical metabolism, base year: 2000

12. Source: INE Source: IGAPHE Source: INE Infrastructural growth

13. Resource productivity Source: Niza & Ferrão calculations Resource Productivity, EU15 and Portugal (1980-2000)

14. Portugal metabolism evidences: • An increasingly open economy, exposed to international trade – mainly imports • A clear stake in infrastructural development – physical stock growth • Resource productivity divergence from the EU average • reflects the effort on long term economical return structures

15. Policy priorities • Policy Target: Resource productivity convergence • Potential for action: • Resource use efficiency growth • Recycling rates growth • Means: • Promotion of business and administration added value (by means of immaterial resources) • Closing of production and consumption cycles

16. Policy priorities • Some specific actions: • Development of wasteproduction models • Establishment of regulation for construction and demolition wastes with target values for recycling • Approaching the European allotment levels between new buildings construction and buildings rehabilitation • Decrease the strong dependence of energy material-intensive sources (e.g. coal, oil)

17. Conclusions • MFA temporal resolution and disaggregation capability turns it the method with the greatest potential to characterize an economy metabolism • Portugal material consumption had a significant growth associated to infrastructural development • Competitiveness and sustainability of Portuguese economy calls for RP convergence with EU and • Promotion of business and administration added value by means of immaterial resources • Promotion of production and consumption cycles closing

18. Thank You!

19. Overview of the Material flow indicators [based on EUROSTAT, 2001] *In addition, balancing items have to be included: On the input side – oxygen for the combustion of fuels and for the respiration of humans and livestock On the output side – water vapour from the combustion of fuels and water vapour and CO2 from the respiration of humans and livestock

20. Visual representations of environmental pressure Rucksack Vs. Footprint

21. Environmental Pressure • MF induces environmental impacts at every stage of production/consumption chain: • Extraction/harvest of primary resources • Covering of nature • Final disposal of residuals

22. Overview of environmental impacts associated to the use of natural resources Source: Muilerman and Blonk, 2001