Citation:

Campbell, D E. ENVIRONMENTAL ACCOUNTING: BALANCING ECONOMIC GROWTH AND ENVIRONMENTAL QUALITY. Presented at Environment Virginia 2004, VMI, Lexington, VA, March 30-April 1, 2004.

Description:

Modern industrial economies depend on the environment to support economic production and a high standard of living. Economic production, in turn, impacts the productivity of ecosystems through waste production and resource use or diversion. Human activities control many energy and material flows of the earth, globally, as well as locally, and thereby human actions can threaten our future prosperity. To compound the problem, we have no widely accepted means to accurately measure the damage we have caused and no currency to determine if we are dealing with this damage in a fair way. Environmental accounting is offered as a remedy for our current situation. This method uses emergy, money and combined emergy-monetary units to construct a single set of accounts for the economy and the environment. Environmental accounting using emergy allows a deeper understanding and more comprehensive definition of debt to the environment than is recognized currently. Two questions are considered. (1) Should society acknowledge debts to the environment? (2) If so, how will environmental debts be measured? The first question must be considered broadly by society before environmental accounting can become a reality. Emergy provides a means to document the accumulation and repayment of environmental debt. One conclusion of this research is that essentially all use or diversion, as well as degradation, of renewable resources to support economic production in industrial societies has been done using credit, i.e., without payment for the useful work contributions of ecosystems. This practice has put our future prosperity at risk. The emergy balance sheet gives direct verification of economic activities that are sustainable.

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