| Sustainable Development Tools
The fundamental principle of sustainable development is well established and widely accepted – economic growth can, and should, be made compatible with stewardship of the planet for future generations.
At EU and Member State levels, and within individual cities and regions, most policy-makers now appreciate the need to reconcile the triple objectives of wealth creation, social cohesion and environmental protection. Many even understand that win-win solutions are possible. But how can they find these solutions? What combination of policies, support measures and technologies will optimise benefits in all three domains? And how should their decisions respond to the often conflicting views of residents, businesses, public authorities and landowners?
Without sophisticated decision-support tools, successfully implementing genuinely sustainable policies is virtually impossible.
Proven and affordable tools
A range of practical tools to support informed and participative decision-making has been developed under the Fifth and Sixth Framework Programmes for research. They include modelling and simulation software, accounting frameworks and codes of practice, as well as impact assessment, performance monitoring and external cost estimation tools.
These tools enhance the capacity of policy-makers, managers, planners, public authorities and enterprises to identify, from a range of options, practical measures that will be most effective in promoting and achieving a level of sustainability suited to their own circumstances and, through acceptable tradeoffs, will maximise the benefits in economic, social and environmental terms.
To support the development and implementation of such integrated tools, specific approaches are needed in order to, on the one hand, define and estimate (in quantitative terms) so-called ‘thresholds of sustainability’ and points of no-return characterising the different ecosystems and, on the other, to quantify the likely impacts on sustainability of measures and policies in physical and monetary terms. The European Commission has developed innovative research in these two domains.
Estimating thresholds of sustainability
Dedicated research funded under the Sixth Framework Programme aims to define and estimate scientifically-based thresholds of sustainability and points of no-return, as a tool for the sustainable management and characterisation of the state of the environment. The definition of such thresholds goes beyond the identification of the carrying capacity of ecosystems, but it implies an equal balance between the necessary ecological, social and economic dimensions. The research covers the estimation of cumulative, interactive effects over time caused by current and foreseeable actions, the coupling of data with policy judgements reflecting costs, the identification of the time and scale of potential damage, and the use of thresholds in policy-making.
A good example of such thresholds of sustainability can be found in climate policy, where a 550 ppm limit value for CO2 concentration in the atmosphere is considered by the IPCC (Intergovernmental panel on Climate Change) as the limit that cannot be exceeded – from the environmental, economic and social points of view – without causing irreversible impacts on climate.
Calculation before action: impact assessment and externalities
Decision-making can only proceed in a sustainable way if the effects of new policy measures are explored and understood before they are introduced. Several years of work to develop a procedure for analysing the impact of policy decisions on sustainability has led to a framework for the assessment of any activity that affects an ecosystem.
Impact analysis and assessment – calculation of the environmental effect of a major construction project, for example – are familiar processes. A strategy for sustainable development must take into account not only its financial costs and benefits, but also its potential environmental and health impacts and its social acceptability.
An essential element for cost-benefit analyses is the ability to place a monetary value on potential economic, environmental and social costs and benefits, whether they arise from action or from inaction. The calculation of an activity’s own ‘internal’ costs is well understood – e.g. a power plant’s capital costs, raw material and running costs determine the price of the electricity it produces. But hidden costs – or ‘externalities’ as they are called in economic terms – must also be taken into account. These include the effect of emissions to the air on human health, groundwater, biodiversity and climate change, the disposal of waste products and the decommissioning of the plant at the end of its working life. These costs may be hard to determine, and research is needed to provide the tools and quantitative data to support calculations.
A series of Community funded projects, known under the acronym of ExternE, showed that the price of electricity produced from coal would more than double if external costs, such as damage to the environment and health, caused by air pollutants, in particular, were taken into account. Even the externalities of natural gas would add approximately 30% to the cost of electricity generation. Since they do not appear on electricity consumers’ bills, such external costs must be met by society at large.
Integrated frameworks for policy assessment
European research has developed a very wide range of tools to facilitate the successive steps of the decision-making process. They include tools and methods for ‘vision-making’, impact assessment, defining objectives and targets, as well as the planning, implementation, monitoring, benchmarking and transfer of good practice.
On the basis of the quantitative approaches presented above, tools are designed to promote the integration of economic, environmental and social dimensions, enabling decision-makers to mitigate the long-term negative impacts of planned projects, policies or technologies, and to maximise their overall benefits. These tools and approaches provide the integrated framework for policy testing.
Testing techniques include scenario development, cost-benefit and cost-effectiveness analyses, technology assessment, and an overall synthesis of as many of these factors as possible. These techniques then enable the best policy-mix to be selected – e.g. the right combination of legal and fiscal instruments, regulations and technology development.
Once introduced, a policy must be monitored to check that its impacts were correctly predicted. The result may require strategic objectives to be re-examined, but a policy that passes this hurdle becomes an example of good practice that can be used in other contexts as a model for sustainable management.
This approach was originally developed for the energy sector, where policy-makers wanted to design ‘carbon taxes’ that would encourage operators to take the impacts of different technologies on global climate change into account when assessing investment options. The European Union Strategy for Sustainable Development encourages policy-makers to make wider use of fiscal and other measures to ensure that ‘external’ environmental and social costs are built into pricing structures.
The approach pioneered by EU research projects is, therefore, being increasingly widely applied as a reference framework in other sectors – e.g. transport, agriculture and forestry – and to the management of geographical areas where conflicting interests and objectives must be reconciled to achieve sustainability. In particular, the integrated approach of EU-funded research is widely applied in past and current European research to urban and peri-urban areas and their relationships with rural areas and coastal zones, where a wide range of activities – including industry, tourism, agriculture, fishery, transport, etc. – need to be evaluated with regards to their impacts in environmental, socio-economic and cultural terms.
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