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An empirical example for ESIs: Material balances and intensities for the Austrian economy

We regard the materials intensity of economic processes as one of the basic general criteria for their environmental impact. Most of the current environmental damage is significantly connected with the extraction, transportation, processing, and use of materials. Therefore the aim is to devise a consistent set of macro-indicators for materials intensity, which should give information on the physical extension (and efficiency) of economic activity."

The suggested indicators for materials intensity trace the material flows from the environment through the economy and back into the environment. The concept of flows, as shown in figure 4, follows the laws of thermodynamics, which state that materials cannot be used up in a physical sense. Nothing gets lost. Macroeconomic material balances always end up with identical sums of material inputs and outputs in terms of mass. The concept of material flows is thus perfectly compatible with the monetary inputoutput cycles basic to the System of National Accounts (SNA).

The material balances include the total material throughput of the economy in millions of tons (as a measure of mass) per time period. Figure 5 presents a quantitative overview of the material throughput of the Austrian economy in millions of tons per year, calculated by Steurer from all sources available. The economy very much resembles a living system: 88 per cent of the throughput is water (more than half of that for cooling purposes), another 8 per cent is air (combustion only), and only 4 per cent consists of other materials. These other materials are mainly accounted for by construction materials, food, and energy carriers. Just 1.6 per cent of the yearly primary input adds to stock. The whole stock could be estimated to amount to no more than 80 per cent of the yearly throughput; more than 90 per cent of the stock consists of buildings and roads.

Fig. 4 The concept of material flows and stocks

Fig. 5 Material throughput of the Austrian socio-economic system, 1988

On the level of the whole socio-economic system, in effect almost all inputs are directly drawn from nature: even the imports are clearly dominated by primary inputs such as energy carriers, and most outputs are released into nature within the course of a year. This holds true for practically all water and air, and for about half of the other materials. The rest is either added to infrastructure (with an estimated durability of 30-50 years), invested in goods of somewhat greater than average durability (5-10 years), or exported. Thus, for the aggregate level of a national economy the distinction between primary and secondary inputs is not very meaningful. It is very meaningful, though, when looking at sectors within the economy.

Table 1 shows empirical material balance sheets for four selected branches of the Austrian economy, namely, extraction of crude petroleum and natural gas, manufacture of refined petroleum products, manufacture of pulp and paper, and the electrical industry. As a result of such material balances it is possible to create a consistent set of material indicators (or indicators for materials intensity) for each branch, which is shown in table 2. The balances are differentiated into primary input, secondary input, output in the form of goods, and output in the form of non-reused wastage.

Primary input is made up of directly extracted material inputs from nature, which constitute the main part of total input, particularly in basic industries. The proportion of primary input in the form of water is extremely high in all industries regarded: it varies between 44 per cent and 97 per cent of the total material input (see table 1). It makes sense, therefore, to distinguish between materials-intensity indicators that are inclusive and exclusive of water. It is interesting that water plays as dominant a role as a primary input to the industrial system as it does for ecosystems.

A very high proportion of total materials input consists of air (oxygen and nitrogen), which is consumed in all processes of combustion. However, we have not calculated that part of the primary input for this empirical presentation.

Secondary input means all material intermediary services within the economic system (from one branch to another). Secondary input can be divided into re-used waste material, renewable resource input, and direct packaging input. Secondary input in the form of durable capital goods or stocks of goods is not defined as material flow and therefore is not significant in terms of the flow concept, but forms part of the material stock balances.

One strategic gap in material flow balances is the difference between total input and total output in the form of goods. That difference is identical with the total material wastage (in gaseous, liquid, or solid form) of production, which will not undergo any further socioeconomic processing and is deposited in the environment in one form or another. The amount of that difference, i.e. the total wastage, has a high information value with regard to the checking, controlling, and completion of emission data; the current availability of such data in Austria, however, is very limited. According to table 1 the total material wastage amounts to 46-98 per cent of the total input (if water is included), and from less than 3 to 31 per cent (if water is excluded).

Table 1 Material balances for four selected branches of the Austrian economy, 1988 (in millions of tons)

Source: Own calculations.

a. Excluding combustible waste material.

b. Including deliveries of unprocessed primary inputs by other branches.

c. Including combustible waste material.

Table 2 Indicators for material-intensity for four selected branches of the Austrian economy, 1988

Source: Own calculations.

a. Excluding oxygen and nitrogen.

b. Percentage of material output in the form of goods to total material input.

c. Percentage of direct packaging input to material output in the form of goods.

In order to compare different industrial activities, time periods, and countries, we suggest the establishment of indicators such as those shown in table 2.

As can be seen from the table, the variability in material intensity between the branches of the economy is very high: whereas in the electrical industry only 10 kg of material input are needed to achieve a production value of 1,000 Austrian Schillings, in the petroleum extraction industry 790 kg correspond to this production value.

The indicator for material efficiency shows quite a different pattern. Here the manufacture of pulp and paper appears to be the most wasteful of the branches analysed, and the petroleum extraction industry the least wasteful. In these cases, therefore, there exists no positive correlation between the value of the input and the efficiency with which it is handled.

In order to be able to analyse and properly interpret data of this kind, it would be necessary to investigate several more branches of the economy and more points in time than is possible for the purposes of this example. As economic statistics in Austria are currently organized, it would be a tedious task to calculate a complete physical input-output matrix of this kind, let alone to reconstruct material flows within the economy. Nevertheless, we believe that such work is indispensable if one is to give an empirical description of "industrial metabolism."

Purposive interventions into life processes (PILs)

Purposive interventions in natural ecosystems are historically the oldest form of modification of the environment for economic purposes. They characterize the beginnings of agriculture and animal breeding. This exchange with the environment is quite different from simple "input" - for example, the intake of plants or meat as nutrition and it is specifically human, at least as specifically as the use of tools.

There are many indications that PILs will gain even more importance in the future. As Moscovici (1990) and Oechsle (1988) state, emissions are a typical problem caused by a `'mechanical" mode of economic production (and a corresponding mechanical paradigm of nature). The necessity of reducing emissions is now broadly accepted, and in the long run their importance will certainly diminish in relative terms. On the other hand, a new, "cybernetic" mode of economic production (and paradigm of nature) is arising, which is characterized by qualitatively new and enhanced possibilities of human control over nature.

There are many examples of this new tendency. The application of analytical-chemical methods yields new possibilities for directing and utilizing natural processes in order to meet human demands (Korab, 1991); new biological technologies are developing rapidly and are being strongly promoted - not least because it is hoped that they will lead to "clean technologies." This tendency can be described as replacing EMIs with PILs, for example, by using biological instead of chemical techniques (Fischer-Kowalski et al., 1991b).

Module of indicators

We developed the following module of indicators in order to mirror relevant processes by which the socio-economic system intervenes in life processes in favour of particular social uses (Fischer-Kowalski et al., 1991a; Haberl, 1991; Wenzl and Zangerl-Weisz, 1991):

1. Interventions into biotopes. Indicators for socio-economic efforts to change the structure of natural ecosystems. The most important efforts of this kind are interventions in water systems, the appropriation of photosynthetically fixed energy (see below), and the input of technically produced substances (fertilizers, pesticides).

2. Violence towards animals. Indicators for social activities that cause suffering and pain to animals. This subset contains two indicators, one for the circumstances in which animals are kept (long-term aspect), and one for short-term aspects: the killing of animals and animal experiments.

3. Interventions in evolution. Indicators for direct (genetic engineering) and indirect (breeding techniques) influences on the gene pool (see Wenzl and Zangerl-Weisz, 1991).

This systematization is based upon the different biological hierarchical levels on which these interventions take place (fig. 6).

Interventions in biotopes: An empirical example

Energy is the "motor" not only for industrial metabolism, but also for natural systems. Ecosystems can be conceptualized as compartment models, in which (more or less closed) materials circles between the compartments are driven by a flow of energy. In fact, the development of ecology as a theoretically integrated discipline in the natural sciences began with the investigation of energy flows by Eugene P. and Howard T. Odum (see Odum, 1983, 1991).

Fig. 6 PlLs according to the level of intervention (Source: Fischer-Kowalski et al., 1991b)

Today, the following concept - described in rather simplified terms - is broadly accepted: Green plants convert the radiant energy of the sun into chemical energy by the process of photosynthesis. The accumulated energy the net primary production (NPP) - is available to all other (heterotrophic) organisms. Consequently, "photosynthetically fixed energy ultimately supports the great diversity of species that inhabit the world's ecosystems" (Wright, 1990).

NPP is the photosynthetically fixed energy accumulated by green plants in a certain period of time (usually one year). It is an important figure for several reasons. First, empirical studies show that "energy flow can be related to numbers of species with species-energy curves" (Wright, 1990). This means that if the amount of energy remaining in the ecosystem is reduced, the number of species living in this ecosystem will diminish (see figure 7). Secondly, there are limits to the fraction of NPP which can be used in a sustainable manner. The human appropriation of NPP is currently estimated at between 20 and 40 per cent of the total terrestrial NPP (Wright, 1990; Max-Neef, 1991). Even if it is not clear at which percentage of human appropriation of NPP the limits of sustainability are reached, the current amount is already considerable, and obviously cannot be increased without further speeding up the extinction of many other species.

Fig. 7 The relationship between number of species and energy flow in biotopes

We therefore propose to use the appropriation of NPP by the socioeconomic system as one of three indicators for purposeful interventions in biotopes (Haberl, 1991). The indicator is formulated as the difference between the hypothetical NPP of the undisturbed ecosystem and the actual NPP.

What does this mean? The hypothetical NPPh (per space unit and year) depends upon morphological and climatic circumstances. Under Austrian conditions it may vary from about 5 TJ/km² in alpine grasslands to 50TJ/km² in flood plains. If man did not intervene, this biological energetic basis would be available to all other species. The socio-economic system may intervene in qualitatively different forms, but they boil down to two strategies: (a) the building of structures (such as highways or buildings) that prevent or drastically reduce the NPP in a certain area (the same road prevents a certain NPPh each year by its very existence); (b) consumption, in that certain amounts of NPP are harvested (or grazed off by cattle) and serve as inputs to the socio-economic system, thereby being no longer available to the ecosystem. What is shown in table 3 as NPPa appropriated by the socio-economic system is therefore the sum of "prevented" NPP and "consumed" NPP.

Table 3 Appropriation of net primary production in Austria, 1988: first estimation

Sources: Bundesamt fur Eich- und Vermessungswesen, 1989; BMLF, 1989a; BMLF' 1989b; ÖSTAT, 1990; own calculations.

a. First estimates based on international literature.

b. Including wine.

c. Including waters and wasteland.

The hypothetical NPP on Austrian territory is estimated to be around 1370 PJ/yr. Thus the socio-economic appropriation of the products of photosynthesis in Austria (620 PJ/yr) amounts to about 45 per cent of the total production.

This means that the socio-economic system produces and reproduces environmental structures that leave more than half of the current photosynthetically fixed energy for all other species apart from human beings. This certainly is highly relevant from the viewpoint of both the natural balances paradigm and the conviviality paradigm.

Conclusions

The concept of metabolism provides a very useful way of directing attention to the physical exchange processes between industrial economy (or, as we prefer to call it, the socio-economic system) and its natural environment. As we have tried to show empirically for Austria, a description of such exchange processes fits in well with standard economic statistics, and in a way mirrors some of the logical structure of the monetary SNA on a physical level.

Deciding which aspects of this metabolism should be described requires a careful selection process. This process may be guided by four basic paradigms for the relationship between the socio-economic system and its natural environment. We have described these as the poison paradigm, the entropy paradigm, the natural balances paradigm, and the conviviality paradigm.

These paradigms draw attention to very different ways in which the socio-economic system causes damage in its natural environment, thereby possibly threatening its own survival. This calls for an information system on "metabolism" that is sophisticated enough to take in a variety of aspects without becoming unwieldy.

One of the examples we demonstrated empirically was the calculation of "material balances" and "material intensities" for selected branches of the economy. The question of how much material input (in terms of weight) the economy needs either as direct extraction from the environment or from other parts of the economy, and how much material output it produces, either as goods for further use or as wastage expelled into the environment, is a crucial element of the description of its metabolism. Empirically it is interesting to note that, in the socio-economic system, water plays as central a role as it does for ecosystems.

Nevertheless? the concept of "metabolism" in its organismic analogy does not take into account a type of interaction between system and environment that is specific for, and typical of, the industrial economy. It does not just consume certain outputs of its environment (resources), and deposit used-up elements as its own output (emissions, wastes), but it purposively intervenes in the structures of the environment - it "colonizes" its environment. This implies a basic asymmetry between the socio-economic system and natural ecosystems. Natural ecosystems may interfere with the socio-economic system (and they do so all the time, sometimes quite forcefully), but they cannot intervene or colonize the socio-economic system in order to make it more useful to them. Under the circumstances of industrial economy, that is as impossible as it is for a monkey to keep a human child as a pet.

So the concept of "metabolism" has to be stretched to come to grips with this asymmetrical process, but without betraying its methodological qualities, which consist in its concentration upon flows (rather than stocks). This is what we are attempting in suggesting (and empirically exemplifying) a measure for the socio-economic intake of photosynthetically fixed energy, which is the basis of most of the life on this planet.

The stunning magnitude of the human interventions in natural systems demonstrate the gigantic size of the industrial metabolism vis-á-vis natural biospheric metabolism. Obviously, the socio-economic system is a strong competitor to all natural ecosystems. Yet one doubts that it will be able to drive them completely into extinction without at the same time bringing about its own destruction.

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