Renewable Revolution

None of the world’s top industries would be profitable if they paid for the natural capital they use

By David Roberts

The notion of “externalities” has become familiar in environmental circles. It refers to costs imposed by businesses that are not paid for by those businesses. For instance, industrial processes can put pollutants in the air that increase public health costs, but the public, not the polluting businesses, picks up the tab. In this way, businesses privatize profits and publicize costs.
 
While the notion is incredibly useful, especially in folding ecological concerns into economics, I’ve always had my reservations about it. Environmentalists these days love speaking in the language of economics — it makes them sound Serious — but I worry that wrapping this notion in a bloodless technical term tends to have a narcotizing effect. It brings to mind incrementalism: boost a few taxes here, tighten a regulation there, and the industrial juggernaut can keep right on chugging. However, if we take the idea seriously, not just as an accounting phenomenon but as a deep description of current human practices, its implications are positively revolutionary.
 
To see what I mean, check out a recent report [PDF] done by environmental consultancy Trucost on behalf of The Economics of Ecosystems and Biodiversity (TEEB) program sponsored by United Nations Environmental Program. TEEB asked Trucost to tally up the total “unpriced natural capital” consumed by the world’s top industrial sectors. (“Natural capital” refers to ecological materials and services like, say, clean water or a stable atmosphere; “unpriced” means that businesses don’t pay to consume them.)
 
It’s a huge task; obviously, doing it required a specific methodology that built in a series of assumptions. (Plenty of details in the report.) But it serves as an important signpost pointing the way to the truth about externalities.
 
Here’s how those costs break down:
 
The majority of unpriced natural capital costs are from

greenhouse gas emissions (38%),
followed by water use (25%),
land use (24%),
air pollution (7%),
land and water pollution (5%),
and waste (1%).
 
So how much is that costing us? Trucost’s headline results are fairly stunning.
 
First, the total unpriced natural capital consumed by the more than 1,000 “global primary production and primary processing region-sectors” amounts to $7.3 trillion dollars a year — 13 percent of 2009 global GDP.

Full Story with charts here:

http://grist.org/business-technology/none-of-the-worlds-top-industries-would-be-profitable-if-they-paid-for-the-natural-capital-they-use/

I'm happy to see the theme of the article I wrote some time ago is gathering traction.  I love it when they start talking about REAL WORLD COSTS, not industry's convenient EROEI happy numbers.

For those who who haven't read it and want the down and dirty details of the fossil and nuclear fuel scam, go here:

Hope for a Viable Biosphere of Renewables: Why They Work and Fossil & Nuclear Fuels Never Did