Summary
Eco‐efficiency is an instrument for sustainability analysis, indicating an empirical relation in economic activities between environmental cost or value and environmental impact. This empirical relation can be matched against normative considerations as to how much environmental quality or improvement society would like to offer in exchange for economic welfare, or what the trade‐off between the economy and the environment should be if society is to realize a certain level of environmental quality. Its relevance lies in the fact that relations between economy and environment are not self‐evident, not at a micro level and not at the macro level resulting from micro‐level decisions for society as a whole. Clarifying the why and what of eco‐efficiency is a first step toward decision support on these two aspects of sustainability. With the main analytic framework established, filling in the actual economic and environmental relations requires further choices in modeling. Also, the integration of different environmental effects into a single score requires a clear definition of approach, because several partly overlapping methods exist. Some scaling problems accompany the specification of numerator and denominator, which need a solution and some standardization before eco‐efficiency analysis can become more widely used. With a method established, the final decision is how to embed it in practical decision making. In getting the details of eco‐efficiency better specified, its strengths, but also its weaknesses and limitations, need to be indicated more clearly.
Summary
Eco‐efficiency has been defined as a general goal of creating value while decreasing environmental impact. Leaving out the normative part of this concept, the empirical part refers to a ratio between environmental impact and economic cost or value. Two basic choices must be made in defining practical eco‐efficiency: which variable is in the denominator and which is in the numerator; and whether to specify environmental impact or improvement and value created or cost. Distinguishing between two situations, the general one of value creation and the specific one of environmental improvement efforts, and leaving the numerator‐denominator choice to the user, as diverging practices have developed, four basic types of ecoefficiency result: environmental intensity and environmental productivity in the realm of value creation; and environmental improvement cost and environmental cost‐effectiveness in the realm of environmental improvement measures.
This paper looks at the compatibility between technological improvements at the micro-level and sustainability at the macro-level. The two main approaches to prevent environmental degradation are technological improvement and economic degrowth. How do we establish the sustainability of technological options? LCA-type analysis of the technology system, combined with economic cost analysis, offers a first integrated eco-efficiency score. However, such a technology analysis focuses on micro-level technology relations only, is usually too optimistic and ignores other constraints implied in a choice.Fitting more comprehensive knowledge into the sustainability evaluation of options requires a unifying systematic framework, which is worked out in the present paper as a tenstep procedure. The integrative framework for empirical analysis is ultimately a comparativestatic systems analysis at macro-level, not in a deterministic dynamic mode, which is impossible, but as a knowledge-fed scenario analysis. The analysis shows the change in society's overall eco-efficiency, combining total value creation with total environmental impacts.Possible domains of application include not only technology choices like those in ecoinnovation, including changed consumption styles and volumes, but also changes in policies regarding technologies and markets, whether direct policy shifts or indirect changes through institutional adaptations. Ultimately, such a framework also allows culturally framed questions about the type of society we would like to live in, to be analysed in terms of their economic and environmental consequences.
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