Economic information and the SEEAW
hybrid accounts
Regional Workshop on Water Accounting
Santo Domingo, Dominican Republic
16-18 July 2007
Michael Vardon
United Nations Statistics Division
1
Outline
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What do hybrid accounts measure?
Concepts
The standard tables of SEEAW
Supplementary tables/information
Examples from Australia and the
Netherlands
The hybrid tables
• Hybrid supply and use tables
• Hybrid accounts
• Hybrid accounts for water-related activities
for own use
• Government accounts for water-related
services
• National expenditure and financing
Why compiling economic accounts for water?
To identify
• The costs associated with production of waterrelated products and income generated by the
production
• The investment in water-related infrastructure
• Costs of maintaining the infrastructure
• Fees paid by users for water-related services and
subsidies received
• Other economic instruments used for the
management of the resources
=> Help to design policies of cost-recovery and
efficient water allocation
Hybrid supply
Hybrid Supply table (Table 5.1, page 66 of SEEAW) consist of 3
parts:
1) Monetary supply (in monetary units) (Output + imports);
2) Physical supply: water supplied to other units and discharged
to the environment (in physical units);
3) Emission of pollutants (gross): pollutants added to water as a
result of production and consumption.
Columns: Industries classified by ISIC
ISIC 36 main supplier of water, other industries also may
supply water as secondary activity
Rows: Products classified by CPC ver. 2
Natural water + distribution services
Sewerage
Hybrid Supply Table
Billions currency units, Millions cubic metres
Output of industries (by ISIC categories)
35
1. Total output and supply (Billions currency units)
of which:
1.a Natural water (CPC 1800)
1.b Sewerage services (CPC 941)
of
5-33,
which:
1-3 41-43 Total Hydro
137.6 749.0 22.1
3.3
0.0 0.040
0.0 0.0
2. Total supply of water (Millions cubic metres)
82.9
2.a Supply of water to other economic units
17.9
of which: 2.a.1- Wastewater to Sewerage
17.9
2.b Total returns
65.0
3. Total (gross) emissions of COD (Thousand of tonnes) 3150.2
0.0
0.0
157.0 405.6
127.6 5.6
117.6 5.6
29.4 400.0
5047.4 7405.1
0.0
0.0
36
1.7
Total
Total
Taxes less Trade and supply at
output,
38,39, at basic
Subsidies transport purchaser’s
37 45-99 prices Imports on products margins
price
9.0 367.0 1286.4 363.0
70.0
0.0 1719.4
1.7
0.0
0.2
8.8
300.0 426.9
0.0 379.6
0.0 1.4
300.0 47.3
0.0 1851.0
0.0
0
1.9
8.8
0.0
0.0
526.5 49.8 1648.7
42.7 49.1 622.5
0.0 49.1 191.6
483.8
0.7 1026.2
498.5 1973.8 19925.9
0.0
0.0
0.0
-0.1
0.0
0
1.9
8.8
1648.7
622.5
191.6
1026.2
19925.9
Hybrid use table
Table 5.2 (page 70 of SEEAW) consists of two parts:
• Monetary use table
Shows the destination of produce in terms of:
• Intermediate consumption
• Actual final consumption of households and
government
• Gross capital formation
• Exports
Final consumption expenditure
and actual final consumption
• Total final consumption may be calculated as:
• Final consumption expenditure
= Total value of expenditures on individual and collective
goods and services of households, NPISHs and
government
• Actual consumption expenditure
= Value of individual goods and services acquired by
households plus the value of collective services provided
by the government
(See box on page 68 of SEEAW)
Final consumption expenditure
and actual final consumption
Final consumption expenditure
Households
(a)
NPSHIs
individua
l
(b)
Government
Collective
(c)
Individual
(d)
Total use of
products
Actual Consumption
Households
Final consumption
expenditures
(a)
Social transfers in
kind from
Government
and NPISHs
(b)+(d)
Government
( c)
Total
(a)+(b)+
(c)+(d)
Total
(a)+(b)+
(c)+(d)
Individual and collective
goods and services
• Individual goods and services of government and
NPISHs are those incurred for the benefit of
individual households (e.g. supply of water to
households by government, etc.)
• Collective goods and services of government are
those incurred for the benefit of the community
(e.g. water management, legislation and
regulation)
Hybrid accounts for SUT
• Combine supply and use of water in a single table
for deriving hydrologic-economic indicators
• Table 5.3 (page 71) consists of 2 parts:
• Monetary SUT [items 1-6]
• Supply, use, value added and gross capital
formation –total and water-related [1-4]
• Stocks of water-related fixed assets [5, 6]
• Physical SUT [items 7-9]
• Use of water [7]
• Supply of water [8]
• Gross emissions [9]
Hybrid accounts for waterrelated activities for own use
• Objective is to separately identify the cost and
output of water-related activities for own use
because costs of activities for own use are
incorporated in those of the principal activity
• Hybrid accounts for own use are carried out for:
• Water collection treatment and supply
• Sewerage
• Remediation activities related to water
Government accounts for
water-related activities
• Government expenditure (collective) on water
related activities are classified by Classifications
of Functions of Government – COFOG
• It includes the following categories:
• Wastewater management
• Soil and groundwater protection
• Environmental protection n.e. c.
• Water supply
National expenditure accounts
• Aim at recording the expenditure of resident units
and financed by resident units for environmental
protection
• CEPA-2000 (Classification of Environmental
Protection Activities) is the classification for EP
It classifies:
• EP activities (Activities whose primary purpose
is the protection of the environment)
• EP products (e.g. septic tanks)
• Expenditures for EP (investment grants, taxes,
subsidies, acquisition of land for EP, etc.)
Environmental Protection
related to water
• CEPA-2000 related to water include:
• Wastewater management
• Activities of sewerage, administration, use of
specific products (e.g septic tanks) and
specific transfers
• Water management and exploitation
• Activities for the collection, treatment and
supply of water, legislation, administration
and specific transfers
National expenditure accounts
for wastewater management
• Table 5.6 (page 82 of SEEAW) includes, by row:
• Use of wastewater services [Item 1]
• Gross capital formation for producing EP
services including acquisition of land [2]
• Use of connected and adapted products (septic
tanks and collecting sludge) [3]
• Specific transfers (current and capital transfers,
earmarked taxes, subsidies, etc.) [4]
• National expenditure = Total domestic uses [5=
1+2+3+4] – the part financed by the ROW [6]
National expenditure for
wastewater management
• Table 5.6 by column:
• Specialized producers (ISIC 37 is the
principal activity)
• Other producers
• Final consumers
• ROW
Financing accounts
Purpose:
• To identify the financing sector of water
related products and the beneficiaries
• It analyzes transfers (e.g. subsidies,
investment grants, taxes) from whom to
whom
Financing accounts
• Table 5.7 (page 83 of SEEAW) shows how
wastewater is financed:
• By row: Financing sectors – institutional
sectors in the SNA
• By column the Beneficiaries (same as
table 5.6)
Country experiences
• The Netherlands – linking economic data to
river basins
• Australia – experimental monetary accounts
Linking Economic Accounts
to the River Basin
The Netherlands
based on: “Integrated river basin accounting in the Netherlands and
the European Water Framework Directive” (Brouwer et al, Statistical
J. of the UNECE 22 2005)
Water Framework Directive
(FWD) and Hybrid Accounts
• WFD: increase in demand for water-related data
• Use Hybrid Accounts which provide
information on
- Intensity of water use by branches of
industry
- The physical flows of supply of water services
- Production costs of water services
- Environmental taxes related to water
- at National and River Basin level
Dutch River Basins
• As Rhine covers 70% of Dutch territory is split-up
4 sub-regions: North, East, West and Centre
River Basins vs Regional
Economic Accounts
Regional Economic Accounts
• 12 Provinces
• 40 Administrative Regions
• Each COROP region consists of several
municipalities
• 512 Municipalities
• Regional accounts are for the 40 Administrative
Regions
• Focus on the production process in each unit, in
the various regions
Assigning Regional Accounts to
River Basins (1)
ECONOMIC DATA
• 23 Regional Accounts fall directly within a specific River Basin
• Other 17 overlap: economic data allocated based on estimated
percentage of employees working in a specific River Basin
• Reason: no economic data available at individual company level
Method:
• Identify specific branches of industry in these COROPs
• Identify number of employees in these branches
• Identify municipalities where these business units are located
• If municipalities fall into 2 River Basins: Postal codes
• If single postal code falls into 2 River Basins: business units
and employees are allocated based on area of the postal code
falling in that River Basin
Value added by River Baisn –
Netherlands
Rhine west
Rhine mid
Rhine east
Rhine north
Meuse
Scheldt
Ems
3%
3%
21%
50%
5%
10%
8%
• Distribution of economic value added generated
in the various river basins in the Netherlands
GDP and environmental
indicators: Netherlands
130
125
120
115
wastewater
nutrients
heavy metals
GDP
110
105
100
95
90
85
80
1996
1997
1998
1999
2000
2001
• Suggests that water is used in a more efficient way
GDP and environmental
indicators: SCHELD River Basin
– Netherlands
140
130
120
110
wastewater
nutrients
heavy metals
GDP
100
90
80
70
60
1996
1997
1998
1999
2000
2001
Confidentiality – a Netherlands
• It concerns economic data and water flow data
• Rules:
• Sector should consist of at least 3 or more companies
• The largest company cannot employ more than 75% of
employees in a specific region
• Largest company in a specific branch of industry cannot
employ more than 70% of total freshwater in that region
• In terms of representation: confidentiality problems are
solved by presenting two sectors together
Example: Water use per River Basin per sector only compiled
for 2 largest River Basins due to confidentiality reasons
Australian experimental monetary
water accounts
• Enable the economic costs and benefits of water supply
to matched with physical data on water stocks and
flows.
• Informs more efficient water allocations:
• ideally, require information on: physical water
flows; prices paid for water used; value added of
water users
• Costs and benefits can occur:
• Now/later (temporal)
• Here/there (spatial)
• Public/private (and between industries), especially
public water supply and private agricultural water
use
Water use in Australia and
scope of the monetary account
Selfextracted
(GL)
Agriculture
Distributed
Water
(GL)
Reuse
Water
(GL)
InStream
(GL)
Water
Consumption
(GL)
6,582
5,329
280
Mining
529
72
7
Manufacturing
246
341
13
589
Water Supply
11,160
2,045
39
2,083
Electricity and Gas
60,172
115
6
59,867
271
All other industries
862
1,561
78
386
1,021
Households
232
1,874
2
79,783
11,337
425
Total
12,191
183
413
2,108
60,436
18,676
Classification of products and assets
Four products were selected for
revenue/expenditure data:
1. Urban distributed water
2. Rural distributed water
3. Bulk water
4. Wastewater/sewerage services
Three assets selected for asset values:
1. Urban water supply infrastructure assets;
2. Urban sewerage infrastructure assets; and
3. Irrigation and drainage infrastructure assets
Primary data sources and reference year
Supply side:
• ABS Economic Activity Survey
• State government, industry association and company
annual reports
Use Side:
• Households: State government reports, WSAA facts
• Agriculture: Water Use on Australian Farms
• Other industries: Economic Activity Survey
• Sewerage services: Environmental Protection
Expenditure Account 1996-97
Reference year: 2003-04
Results – economic output
• Total output of water & sewerage services in
was AUD$7.3 billion, of which;
- sewerage services generated AUD$3.4
billion;
- urban water sales generated AUD$3.3
billion;
- bulk water sales AUD$0.5 billion; and
• sales of rural water were worth AUD$0.3
billion
• water supply industry supplied 8,296 GL of
water
Results – expenditure on water
• Households highest expenditure AUD$2,046
million (59% of total), used 1,874 GL of water
(23%)
• Agriculture spent AUD$293 million (8%) for
5,329 GL of water (64%)
• Victoria lowest annual consumption per
household (204 KL) and lowest expenditure
per household (AUD$205)
• Northern Territory highest annual
consumption per household (453 KL) and
highest expenditure per household (AUD$507)
Results – total value of infrastructure
• Total assets AUD$73.0 billion
• wastewater & sewerage assets AUD$35.0 billion
• Urban water infrastructure assets AUD$ 32.0 billion
• Irrigation and drainage assets - AUD$6.0
billion
Experimental hybrid use table
Note mixed years
Monetary v physical use of distributed water
(% of total use)
Households
All other Industries
Electricity
$m
GL
Water Supply
Manufacturing
Mining
Agriculture
0
20
40
60
Brown = money, Blue = water
80
Conclusion
• Relating economic information to water
information is the main reason SEEAW was
developed
• Economic data are often held in national statistical
offices and can be matched with water information
• A good starting point is compiling the economic
data of the water supply (ISIC 36) and sewerage
industries (ISIC 37) and matching this with supply
and use of water within the economy
• This information will help to assess water
pricing and allocation regimes
Contact details
Michael Vardon
Adviser on Environmental-Economic Accounting
United Nations Statistics Division
New York 10017 USA
Room DC2 1532
Phone: +1 917 367 5391
Fax: +1 212 963 1374
Email: vardon@un.org