Impact pathway approach

The Impact pathway approach

by USTUTT (Peter Bickel and Rainer Friedrich)

The Impact Pathway Approach (IPA) has been developed to support policy decisions in the context of reducing environmental and health impacts from energy use (ExternE project series). It is similar to the causal chain approach used in Intarese.

The general idea of the Impact Pathway Approach is illustrated in Figure 1. A human activity (e.g. electricity production) causes changes in environmental pressures (e.g. air pollutant emissions), which are dispersed, leading to changes in environmental burdens and associated impacts on various receptors, such as human beings, crops, building materials or ecosystems (e.g. emissions of air pollutants leading to respiratory diseases). This change in impacts leads either directly or indirectly (e.g. through health effects caused by air pollutants) to a change in the utility of the affected persons. Adverse health effects and welfare changes resulting from these impacts are transferred into monetary values. Based on the concepts of welfare economics, monetary valuation follows the approach of ‘willingness-to-pay’ for improved environmental quality. It is obvious that not all impacts can be modelled for all pollutants in detail. For this reason the most important pollutants and damage categories (so-called “priority impact pathways”) are selected for detailed analysis.

Fig. 1: The Impact Pathway Approach for the quantification of environmental costs.

One of the strengths and main principles of the IPA is the valuation of damages (e.g. additional respiratory hospital admissions) and not pressures or effects (e.g. emissions of fine particles). The monetary valuation of concrete casualties (e.g. hospital admissions) is more reliable and transparent than deriving a general willingness-to-pay for reducing air pollution.

Many of the impact pathways include non-linearities, due to air chemistry for example, therefore impacts and costs from two scenarios are calculated: a reference scenario reflecting the base case concerning the amount of pollutants or noise emitted, and a modified scenario, which is based on the reference scenario, but with changes in emissions due to the activity considered. For the marginal analysis this may be an additional road vehicle, for the sectoral analysis this may be the emissions from the electricity production sector in one country. The difference in physical impacts and resulting damage costs of both scenarios represents the effect from the activity considered.

The principle of modelling the pressure (e.g. emissions), resulting burden (e.g. pollutant concentration increase), response of receptors (e.g. health damages) and monetary valuation can and should be applied for all impact categories. The main bottleneck of this procedure is the availability of the models required for the different stages.

The IPA was developed, made operational by providing the models required on each stage and updated for air pollution impacts in the ExternE project series (see e.g. Friedrich and Bickel, 2001; European Commission, 1999 and 2005). Besides the different phases of ExternE the methodology has been used and applied to support several policy decisions and legislative proposals, e. g. of DG Environment, such as to perform economic evaluations of the:

• Draft directive on non-hazardous waste incineration.
• Large combustion plant directive.
• EU strategy to combat acidification.
• Costs and benefits of the UN-ECE Multi-pollutant, Multi-effect protocol and of proposals under this protocol (e.g. NOx and VOC control).
• Costs and benefits for the emission ceilings directive.
• Air quality limits for PAHs.
• Diversion of PVC from incineration to landfill and recycling.
• Benefits of compliance with the EU environmental acquis: quantification of the benefits of air quality improvements.
• Costs and benefits of acidification and ground level ozone (as input to negotiation on the ozone directive 1998).
• Air quality guidelines on CO and benzene.
• Second NOx Protocol (for the UN-ECE Task Force on economic aspects of abatement strategies).
• Clean Air for Europe (CAFE) Programme

References

European Commission (1999): ExternE: Externalities of Energy. Vol.7: Methodology 1998 Update (EUR 19083); Vol.8: Global Warming (EUR 18836); Vol.9: Fuel Cycles for Emerging and End-Use Technologies, Transport and Waste (EUR 18887); Vol.10: National Implementation (EUR 18528). Published by European Commission, Directorate-General XII, Science Research and Development. Office for Official Publications of the European Communities, L-2920 Luxembourg. Available at http://www.externe.info/

European Commission (2005): ExternE - Externalities of Energy – Methodology 2005 Update. EUR 21951 EN. Office for Official Publications of the European Communities, Luxembourg 2005, ISBN 92-79-00423-9. Available at http://www.externe.info/

Friedrich, R. and P. Bickel, (eds.) (2001): Environmental External Costs of Transport. Berlin Heidelberg, Springer-Verlag, 2001.