CEI: A Consumer Environmental Index for Washington State Sound Resource Management Olympia, Washington 360-867-1033 Jeff.Morris@zerowaste.com Environmental Summit – May 20, 2008 Acknowledgements Sound Resource Management Economist Team: Dr. Jeffrey Morris, SRMG - Team Manager Dr. H. Scott Matthews, Carnegie Mellon University Dr. Frank Ackerman, Tufts University Washington State Department of Ecology, CEI Project Steering Committee: Dennis Bowhay Chris Chapman Cristiana Figueroa-Kaminsky Ivor Melmore - Project Manager Gretchen Newman Cheryl Smith Ken Zarker Presentation Outline The Problem Life Cycle Analysis The CEI Solution CEI graphs Consumer Pollution Intensity in 2005 A Few CEI Details CEI limitations and Data Gaps CEI Robustness Economics – The Good, The Bad & The Ugly 1) Efficiency & Equilibrium – the magic of competitive markets (Adam Smith’s invisible hand creates optimality). 2) Externalities – pollution from free disposal (If it doesn’t have a price or cost the market ignores it). 3) Equity – dollar votes drive markets (Those without dollars don’t get to vote; those with more dollars get more votes). The CEI Solution An index like the CPI - except covers all consumer purchases, not just unchanging basket, and measures changes over time in environmental impacts, rather than prices. Tracks the environmental impact of consumer choices on (1) climate change, (2) public health, and (3) ecosystems health. Should decline when there are decreases in toxic substances, wastes and/or pollution associated with production, use, and disposal of the goods and services consumers demand. Data Sources 1. US BLS 700 category CES 2. US BEA 491 sector EIO 3. US EPA TRI, AIRData & GHG Emissions 4. US DOE Transportation Energy Data Book 5. Carnegie Mellon EIO-LCA model 6. WA Dept of Ecology air emissions data 7. Process LCAs for paint, used oil, & pesticides 8. US EPA WARM & MSW DST models Life Cycle Analysis (LCA) Energy Raw Materials Acquisition Wastes & Pollution Energy Energy Materials Manufacture Product Manufacture Wastes & Pollution Wastes & Pollution Energy Product Use or Consumption Wastes & Pollution Energy Final Disposition – Landfill, Combustion, Recycle or Reuse Wastes & Pollution Reuse Product Recycling One or limited number of return cycles into product that is then disposed – open-loop recycling. Repeated recycling into same or similar product, keeping material from disposal – closed-loop recycling. LCA Environmental Impacts 1. Global warming (eCO2) 2. Human health – particulates, SOx and NOx (ePM2.5) 3. Human health – toxins (eToluene) 4. Human health – carcinogens (eBenzene) 5. Ecosystem toxicity (e2,4-D) 6. Others – acidification, eutrophication, ozone depletion, smog formation, resource/fossil fuel depletion, land use, water use, biodiversity, habitat alteration, indoor air quality Consumer Climate Change Index (2000 = 100) Aggregate Per Person Per $ Spent 145 140 135 130 125 120 115 110 105 100 95 90 85 2000 2001 2002 2003 2004 2005 Consumer Particulates Emissions Index (2000 = 100) Aggregate Per Person Per $ Spent 145 140 135 130 125 120 115 110 105 100 95 90 85 2000 2001 2002 2003 2004 2005 Consumer Human Toxins Index (2000 = 100) Aggregate Per Person Per $ Spent 145 140 135 130 125 120 115 110 105 100 95 90 85 2000 2001 2002 2003 2004 2005 Consumer Human Carcinogens Index (2000 = 100) Aggregate Per Person Per $ Spent 145 140 135 130 125 120 115 110 105 100 95 90 85 2000 2001 2002 2003 2004 2005 Consumer Ecosystems Toxicity Index (2000 = 100) Aggregate Per Person Per $ Spent 145 140 135 130 125 120 115 110 105 100 95 90 85 2000 2001 2002 2003 2004 2005 Consumer Environmental Index (2000 = 100) Aggregate Per Person Per $ Spent 130 125 120 115 110 105 100 95 90 85 2000 2001 2002 2003 2004 2005 2005 Pollution Intensity WA Consumer Spending Climate %Tot$ Kg/$ %Kg Home Heat/Cool Transportation Food Home Furn/Sup Shelter Clothing Tobacco Average Total Mg/Person 5.5% 17.7 11.6 11.1 19.0 4.0 0.3 Particulates Kg %Kg Toxins Carcinogens Kg %Kg Kg %Kg EcoToxicity Kg %Kg 5.13 30.7% 9.2E-03 46.2% 1.62 8.2% 4.2E-03 26.0% 1.7E-02 1.63 31.5 9.2E-04 15.0 1.33 21.8 1.9E-03 37.0 2.2E-02 1.07 13.5 1.3E-03 14.0 1.09 11.8 4.7E-04 6.2 6.9E-03 0.52 6.3 5.9E-04 6.1 1.50 15.4 6.9E-04 8.6 1.2E-02 0.35 7.3 4.2E-04 7.3 1.23 21.6 4.8E-04 10.2 6.2E-03 0.56 2.4 7.9E-04 2.9 1.18 4.3 6.7E-04 3.0 1.5E-02 0.37 0.1 2.3E-03 0.6 1.04 0.3 4.2E-04 0.1 5.0E-03 0.91 1.1E-03 1.08 8.9E-04 1.0E-02 18.57 0.02 21.92 0.02 0.20 9.3% 38.5 8.0 13.9 11.8 6.0 0.1 EIO – LCA Model Implementation of US Department of Commerce published IO tables • Current benchmark: 1997 (2002 soon) Long-term project: 10 years in making • Free, online at www.eiolca.net Widely used for LCA research in the US • More than 100 peer-reviewed papers on development and application • More than 1 million uses of the model Important Issues for Project Team & Peer Reviewers TRI limitations - e.g., agriculture Impacts not covered – e.g., habitat and ecosystem services degradations Use phase coverage not complete – e.g., household cleaning/laundering products and pharmaceuticals New home construction not included Differential impacts of domestic vs. foreign production Imports as Example of CEI Robustness Weber and Matthews study – US produced 22% of eCO2 in 2005, but US consumption accounted for 25-26%, about 15% more than production. This could mean that CEI model climate change upstream impacts should be 15% higher. If 15% higher in all years 2000-2005, then CEI climate change component only up from 118.1 to 118.4, and overall CEI up from 126.2 to 126.4.