Accounting for ecosystems and their services in the European Union

Ecosystem services are worth as much as the agriculture and forestry combined.
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A new report shows that EU’s ecosystems generated an annual flow of selected seven ecosystem services at the value of € 172 billion. Restoring degraded ecosystems has the potential to double nature’s contribution to the EU economy.

Ecosystem accounting - Making nature count

Have you ever wondered how much ecosystems contribute to our economy and wellbeing, whether anybody measures this and how it could be measured in the first place?

How do forests protect downstream infrastructure from flooding?

How much would it take to replace the water purification function of wetlands if it suddenly stopped?

What value do pollinating wild bees and butterflies provide to farmers?

Ecosystem accounts help answer these questions, by tracking the extent and fitness of ecosystems over time. They also measure how ecosystems contribute to economic activity and human wellbeing.

JRC developed a novel method to account for ecosystem services

Partner of the INCA project, the JRC developed a new methodology to unravel how these ecosystem services flow from nature to our economy.

The new method estimates firstly where and how much services ecosystems can potentially deliver. This potential depends on the extent (size) and the condition (health) of ecosystems in Europe, recently published as the EU Ecosystem Assessment.

Next, the method estimates how much services are demanded by households and economic sectors. Where do farmers grow crops that depend on insect pollinators; or where are people and infrastructure need protection against natural disasters.

By comparing potential and demand on maps, researchers can then calculate how much ecosystem services are actually supplied by ecosystems for use by different sectors. Both supply and use, which are always equal in an account, are recorded in a statistical table, just as if it were a transaction between two economic sectors.

Policy uses of ecosystem accounts

The strength of this approach is that it can also map unmet demand: where are ecosystems running short in supplying services to local communities, farmers, or other economic activity that depends on ecosystems. This is useful to identify areas where restoring ecosystems brings direct benefits to society in terms of increased ecosystem services such as pollination or flood protection.

The JRC contributed several case studies to the report of how to use ecosystem accounts. Ecosystem accounts link the natural system to the economy. So, the accounts are helpful to analyse the economic fallout of impacts on the environment.

Further information

Details

Publication date: 23 June 2021