Indicator: Environmental costs of energy and road transport

A graph shows the development of environmental costs energy generation and road transport between 2008 and 2014. They were 138.3 billion euros in 2008 and 130.1 billion in 2014.Click to enlarge
Environmental costs (greenhouse gases and air pollutants) of power and heat generation ...
Source: German Environment Agency Figure as PDF

Table of Contents

 

At a glance

  • Environmental costs of energy generation and road transport decreased by only 6 % between 2008 and 2014.
  • Transport-related environmental costs rose by nearly 6 % between 2008 and 2014.
  • Environmental costs of power and heat have decreased over the past years by 12 % and 13 % respectively.
 

Environmental importance

Environmental costs are economically highly relevant, as was demonstrated by the economist Sir Nicholas Stern in his Review on the Economics of Climate Change in 2006 (Stern 2006). The Stern Report, as it became known, estimates that the costs caused by climate change will amount to 20 % of the global annual gross domestic product.

The use and transformation of energy resources for electricity and heat generation and road transport pollutes environment through the emission of greenhouse gases and air pollutants, e.g. particulate matter and nitrogen oxides. The air pollutants released cause an increase in morbidity, damage to buildings and monuments (facade pollution) and are a burden on ecosystems (cf. ‘Health risks due to particulate matter’ and ‘Agricultural nitrogen surplus’). The emitted greenhouse gases contribute to climate change. This is linked to costs to the economy, for instance for repairing damage caused by storm or treatment of environment-associated diseases.

Energy generation and road transport cause environmental damage through greenhouse gases and air pollutants, but also infringe further on the environment by land consumption, noise pollution and water pollution. These are not included in the indicator.

 

Assessing the development

Total environmental costs decreased from 138.3 billion euros in 2008 to 130.1 billion euros in 2014. This is equivalent to a decrease of 6 %. However, environment costs for transport increased over the same period (+ 6 %). This could not even be changed by the development of more efficient drive systems. An increase in road traffic and a trend towards more powerful motor vehicles are responsible for this development.

By contrast, environmental costs for heat and electricity fell by 12 % and 13 % respectively. This is due to an increased use of renewables. Using renewable energy sources causes significantly less environmental damage through air pollutants and greenhouse gases than using fossil energy sources such as coal, mineral oil or natural gas.

 

Methodology

Calculations of environmental damage are based on the ‘Methodological convention for the estimation of environmental costs’ of the German Environment Agency (UBA 2013). The convention helps to determine costs for the use of the environment according to uniform and transparent criteria. It takes current research into account.

The methodological convention includes cost rates for the environmental costs of greenhouse gases, air pollutants and noise as well as cost rates per kilowatt-hour of electricity and heat generated and per kilometre travelled. The environmental costs incurred by electricity and heat generation as well as transport can be estimated on the basis of these cost rates.

More detailed information: 'Gesellschaftliche Kosten von Umweltbelastungen' (in German only).