Lecture 02 Class Notes

Environmental Accounting Identities: IPAT and its Children

IPAT is one (limited) approach – A tool for the toolbox.

IPAT Identity Origin
IPAT came about as a result of truce between two camps of environmentalists - Erlich and Erlich (too many people/overpopulation) vs. Commoner (destructive technology). There was a fight between population and technology as the main driving force of environmental problems. IPAT is the compromise (1960s to 1972 publication).

The Equation
Impact = Population*Affluence*Technology

How do you make Impact 0%? Or decline? You can’t have everything increasing.

1972 elaboration –
I = P*A*T -> Emissions (tons) = Pop*(GDP/Pop)*(tons/GDP)

How is it most commonly used?

• Make and critique future trends in environmental impacts
  • Historical, recent, predictive
  • Manipulable
  • Can be measured using whatever metrics you’re interested in
  • Reduce intensity of use=dematerialization
  • Reduce impact/good=efficiency
• Ex: Emissions CO2 (tons) = Pop*(GDP/pop)*(tons/$GDP)
  • Doesn’t have any content (just equals out to emissions) – only a method of understanding
• Modern versions:
  • ImPACT model (Waggoner and Ausubel) - Adds consumption
    • Industrial ecology uses ImPACT
    • Im=Environmental impact
    • P=population
    • A=affluence (GDP/capita)
    • C=intensity of use/consumption
    • T=impact/good
  • Kaya identity (Raupach et al)
    • IPAT related to global CO2 emissions and climate change
    • CO2 = Pop*(GDP/Pop)*(Energy/GDP)*(CO2/Energy)
    • Energy intensity for generating goods and services versus how society gets it energy
    • Society that ran entirely on neutrals (nuke E, for ex) would be zero
    • Dominant framework (right now) for GHGs
  • Decomposing Rates of Change
    • Transform the identity to differential form
    • Using % rates of change, elasticities, logarithmic derivatives
    • IF… CO2=Pop*GDP/Pop*Energy/GDP*CO2/Energy, THEN… %ΔCO2 = %ΔPop + %ΔGDP/Pop + %ΔEnergy/GDP + %ΔCO2/Energy - see slide for example
    • Use for projecting future trends and/or scenarios

IPAT Limitations

• Factors not independent, they can’t be separately manipulated.
• Emissions don’t equal impact. There’s nothing about interactions and non-linearity of environmental effects. It could be more important to avoid certain increases in certain points of time and less important for others.
• Aggregate representation ignores distributional issues. Differences in income, contribution, growth rates among sub-groups and individuals. Ex: lots of emissions from a very small number of cars.
• Equity, types of consumption
• Remember limitations and keep them in mind when using identities. Still overall useful.

Individual IPAT Factors

Population

• One of the earliest environmental concerns.
• Malthus (1780), economics as the dismal science.
• There was a population panic in the 1960s. 20th century population explosion as well as a food production collapse.
• 1962-1963 was a peak in population growth
• Now, the population is growing at 1.1% and declining.
• This is a policy area that is usually avoided.

Does Earth have a carrying capacity?

• Credible estimates from 1 billion to 1 trillion. Middle half is STILL 4-16 billion.
• Very unhelpful
• We’re just guessing how many people the Earth can support.

Affluence/Consumption

• Affluence is a tricky term because it is measured mostly as consumption, but that’s not the same thing.
• Flow of “value” or “affluence” (want it to grow) versus flow of “materials/energy” (decline); Is this possible?
• Affluence has components of individual choice and value
• Is identical to human welfare?
• May be impossible to separate these two – no experience without burning the fuel
• Working one good at a time doesn’t work – have lost the “aggregate” benefit
• Limiting consumption problems
• Legit? What about the poor? Is it feasible? Will be really, really hard to get people to give up what they love. → Polite conversation goes back to technology

Technology

• “Evil technology” argument by Commoner has been refuted
• Mixed and ambiguous – both increases AND decreases environmental burdens
• Strongest driver of environmental trends
  • Direct effect reduces environmental burdens
  • Can manage environmental problems well using tech
• Alt tech pathways drastically affect the future projections
• Assumes, however: Tech can bring a future that is rich AND green.
• Concerns:
  • Evidence of limits of our ability to control/predict technology
  • Lock-in effects and feedback loops
  • Decentralized actors are more effective than government
• Linkage: rebound effects
  • Tech gain is offset by behavioral change. Jevons paradox – lose all you gain and more. Example – fuel economy, lighting.
  • Ex: increase fuel economy, people drive more
• Can motivate tech change with policy?
  • Hard to control it

Closing questions:

• For impacts:
  • What factors can be controlled?
  • By who? How?
  • What consequences?
• How do we evaluate burdens/impacts?
  • Accounting identities are “value free,” except that we assume impacts are bad