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Green Net Regional Product for the San Luis Basin, Colorado: An Economic Measure of Regional Sustainability
Citation:
HEBERLING, M. T., J. J. TEMPLETON, AND S. Wu. Green Net Regional Product for the San Luis Basin, Colorado: An Economic Measure of Regional Sustainability. JOURNAL OF ENVIRONMENTAL MANAGEMENT. Elsevier Science Ltd, New York, NY, 111:287-297, (2012).
Impact/Purpose:
To inform the public.
Description:
This paper presents the data sources and methodology used to estimate Green Net Regional Product (GNRP), a green accounting approach, for the San Luis Basin (SLB). GNRP is equal to aggregate consumption minus the depreciation of man-made and natural capital. We measure the movement towards or away from sustainability by examining the change in GNRP over time. Any attempt at green accounting requires both economic and natural capital data. However, limited data for the Basin requires a number of simplifying assumptions. It requires transforming economic data at the national, state, and county levels to the level of the SLB. Given the contribution of agribusiness to the SLB, we included the depletion of both groundwater and soil as components in the depreciation of natural capital. In addition, we captured the effect of the consumption of energy on future generations through carbon dioxide (CO2) emissions. For each component of the depreciation of natural capital, we need an estimate of the change in the stock of the capital. To incorporate the change in the stock of capital into the measurement, the shadow price of groundwater for irrigation, the economic damages from wind erosion, and the social cost of carbon emissions were obtained from the literature and applied to the SLB using benefit transfer. We aggregated the economic data and the depreciation of natural capital for the SLB from 1980-2005; the results suggest that GNRP had a slight upward trend. The approximation of GNRP, especially during the period 1985-86 to 1987-88, suggests the region may be moving away from sustainability during the study period. Negative growth in GNRP has not been observed since 1999-2000, however.
