BOX 4K
APPROACHES TO INDICATORS OF SUSTAINABLE DEVELOPMENT IN THE EUROPEAN COMMISSION

Isabelle Guinomet
Alessandra Sensi
Jochen Jesinghaus
Jonathan Parker

The European Commission has assigned a high priority to the rapid development of Indicators of Sustainable Development, as announced in the Communication from the Commission to the Council and the European Parliament on 'Directions for the EU on Environmental Indicators and Green National Accounting'. This Commission proposal has two main thrusts:

(a) to establish a 'European System of Integrated Economic and Environmental Indices, and to provide a much needed direct integration of economic performance and environmental pressures of economic sectors in a comparable way' ;

(b) to adjust the national accounts in a satellite format, detailing environmental expenditures, establishing natural resource accounts and improving knowledge of methodologies for environmental damage assessment and monetary evaluation.

The European Commission is pursuing the implementation of its indicator programme in three distinct areas described below:

THE METHODOLOGY

The methodology for describing the environmental component of sustainable development by means of environmental pressure indices is being developed by Eurostat1. The project is composed of 30 sub-projects structured in a chain process and divided into three modules:

Module 1

Module 1 has 10 Pressure Indices Pilot Projects (PIPs), aimed at identifying the 'demand' for indicators and related statistics from the standpoint of the users. This group of projects aims to define a set of indicators, describing pressures on the environment resulting from human activities, in a highly aggregated format for the ten problem areas (or 'policy fields') of the European Union's Fifth Environmental Action Programme, 'Towards Sustainability' :

1. Climate Change
2. Ozone Layer Depletion
3. Loss of Biodiversity
4. Resource Depletion
5. Waste
6. Air Pollution
7. Dispersion of Toxins
8. Water Pollution & Water Resources
9. Marine Environment & Coastal Zones
10. Urban Problems, Noise & Odours

The selection of indicators is being carried out by environmental experts as follows:

a) the selection of a panel of about 200 EU experts by policy field (the so-called Scientific Advisors Group, SAG) recognized by 10 specialized institutes; 
b) the identification of the most relevant indicators, describing the pressure by policy field through a written questionnaire sent to panels of experts. This survey started in December 1994, and more than one thousand different indicators were proposed; 
c) the reduction of the proposed indicators to a manageable number of 25-30 per field;                                                             d) a second survey among the experts (via a written questionnaire) asking them to judge the usefulness of these indicators, to reach a consensus on the indicators to be used in the project, and to obtain a final set of 'core indicators' by policy field.

The latter survey started in October 1996 and some of the first results are already available. For example, experts (mainly specialized natural scientists) were asked, among other questions, which pressure indicators they would choose if they had to describe the pressure on the marine environment and the coastal zones with just five indicators. 'Eutrophication' and 'overfishing' were ranked extremely high. About 50% of the experts placed these indicators on their personal core' list. One important result of this survey is the fact that it will be difficult to limit the indicators to a reasonable number (e.g. five to ten per policy field), because the 'ranking' is rather flat. Apparently, SAG scientists insist that many indicators are required to give a good description of the pressures caused by human activities. Although other policy fields (e.g. air pollution) show a 'steeper' ranking, it is obvious that developing d comprehensive system of pressure indicators and indices will be a 'data-hungry' exercise that requires the full involvement of the statistical system of EU Member States, as well as the capacities of the European Environment Agency (EEA).

In the long term, these indicators should be weighted together by indices ( one index by policy field). In order to establish the weighting coefficients, a final survey among experts will be conducted. This phase has not yet started and will need testing before being implemented.

The results of the project, up to the second survey, will be published in 1997. In 1998, a single publication of 60 environmental pressure indicators, covering the fifteen member states of the European Union, will be ready. It will contain two types of environmental pressure indicators:

Module 2

Module 2 has 12 Sectoral Infrastructure Projects (SIPs) that are aimed at identifying the 'demand' and the 'supply' of indicators with a sectoral breakdown. This group of projects aims to look at the contribution of the different economic sectors to environmental pressures. The six projects are structured according to the target sectors of the Fifth Environmental Action Programme:

1. Energy
2. Agriculture
3. Transport
4. Industry
5. Tourism
6. Waste Management2

Each of the six SIPs ( one project per sector) is divided into two parts:

1) the 'indicators part', which aims to identify pressure indicators by sector and to develop the methodologies needed to calculate these indicators, while taking into consideration the recommendations of the SAGs;
2) the 'basic data part', which aims to evaluate the steps necessary to provide the statistical inputs needed to calculate these indicators. 

The results of the Sectoral Infrastructure Projects will be published in the form of a European Indicator Handbook, intended to set a standard for indicator methodologies to be used by Statistical Services. Sectoral publications on the trends of the identified 'priority indicators' are planned as a next step in this project.

Module 3

Module 3 has eight 'Environmental Pressure Information System' project& (EPIS)3 aimed at 'supplying' indicators through a database which integrates physical and economic data. The EPIS project is established to calculate pressure indicators with high actuality by economic activities and private households.

The pressure indicators must be calculated using actual and solid data, if they are to support policy-makers in their decisions for political actions. At the moment, there are substantial gaps in environmental statistics at the european level, as well as in most of the member states, which are needed to form the basis for the pressure indicators. Therefore, there is a need for an additional database in order to calculate actual and sensitive pressure indicators. This additional database will be an EPIS. The database will facilitate the calculation of emissions and raw material consumption in the European Union. In spring 1997, the methodological reports of the first four EPIS countries will be available.

THE IMPLEMENTATION OF THE ISD FRAMEWORK

Eurostat is following and supporting the work of the UN CSD Expert Group on the implementation of the framework on Indicators of Sustainable Development. Since August 1996, the goal of Eurostat is to compile a pilot set of indicators of sustainable development, following the UN CSD methodology and framework, based on statistics already collected or held by Eurostat, covering all EU member states. A subset of the UN CSD Indicators of Sustainable Development list (as published in August 1966 in the 'Blue Book') has been selected by Eurostat, according to relevance and data availability for a sufficient number of EU member states (see Table 1). It represents a pilot working list of 47 indicators for EU member states.

This current publication on ISD provides one 'early harvest' contribution by the Commission in developing measures of sustainability towards meeting the goals in the 1994 Communication. It should be understood that such a short-term pilot exercise does not replace the long-term development of a more sophisticated set of ISD at the national or EU level; rather, it should be seen as a contribution towards further developments.

The longer term development of ISD for measuring progress towards sustainability will require careful reflection by the European Commission services, the European Environment Agency and other international organizations.

TWO COMMISSION PROGRAMMES

Two commission programmes developed by DG XII are of particular relevance: the ExternE project (dealing specifically with the externalities of energy), and the Human Dimensions of Environmental Change Research Programme (HDECRP) putting research into indicators that aim to measure the progress of the EU towards sustainable development.

A key component will be further research into indicators that help measure the progress of the European Union towards sustainable development. These two Commission programmes are of particular relevance.

ExternE assesses the environmental externalities of energy. Specific areas covered in the programme include fuel cycles for the generation of electricity from fossil, nuclear and renewable resources, domestic use of natural gas, and energy use in transport. The methodology developed under the programme is based on the 'damage function' approach. This allows for a detailed, site specific assessment of externalities, using the latest data in the fields of energy technology, environmental science and economics. The project team now extends to all EU Member States (except Luxembourg) and Norway. There is also active collaboration with experts in the USA. The application of the results for the development of measures for the internalization of external costs is currently being explored.

In the HDECRP, a significant amount of work is being undertaken on environmental accounting and damage evaluation issues relevant to the level of the national income aggregate; policy, programme and project appraisal and; the firm. Physical indicators of environmental pressure and use are being developed (including energy and 'materials accounting' based measures). Evaluative schemes for environmental pressure, such as damage and avoidance costs and individual willingness to pay, measured through contingent valuation, are included. The issues of irreversibility of an ecosystem and natural amenity loss, human health, the treatment of uncertainty and the depletion of natural capital are also being addressed along with social contingency and general applicability of the resulting measures.

Two projects on physical indicators of sustainability are just starting. The first, on materials accounting as a tool for decision-making in environmental policy, aids in: early recognition of resource depletion and environmental loading problems; priority setting and the elaboration of measures to protect the environment, especially in urban areas and; the transition to more environmentally sound goods and services. The second seeks to coordinate research within the EU on regional and national material and substance flow accounting; in particular, to exchange information and coordinate current and future policy, relevant work on regional and national material, and substance flow accounting (MSFA), primarily in the European Union.

NOTES

1 Eurostat is both a Directorate-General of the Commision (DG 34) and the Statistical Office of the European Communities, coordinating the European Statistical System (ESS) with the member states.

2 Although 'Waste Management' was not originally mentioned in the 5th Environmental Action Programme, it was added because of its growing importance for environmental policy.

3 The original name ESIS (Emission Structure Information System) used in earlier publications was changed because many pressure indicators concern non-emissions like land-use, resource depletion, etc.