Resolute environmental protection will save society many billions of euros

German Environment Agency provides new cost rates for environmental damage

Feuerwehr hilft bei Überschwemmung.Click to enlarge
More heavy rainfall due to climate change can mean high costs in case of floods.
Source: asafaric / Fotolia.com

Greenhouse gases, nitrogen emissions and other environmental pollution cause damage to human health and destroy ecosystems. They also lead to production losses, crop losses and damage to buildings and infrastructure. For many of these damages, there are established scientific methods to express them in monetary terms. The new publication “Methodological Convention 3.1” by the German Environment Agency (UBA) has updated the cost rates of environmental pollution and added cost rates for nitrogen and phosphorus emissions, greenhouse gases in the agricultural supply chain and building materials. UBA President Professor Dirk Messner said, “Systematic protection of the environment and climate saves us and future generations many billions of euros through reduced damage to the environment and health. The issue should play a much greater role in the current discussions on the EU climate target or on EU agricultural policy and its national implementation – but also in trade policy.”

The production of a single cubic metre of tropical hardwood causes at least 1,440 euros in environmental damage costs; the production of one tonne of medium-strength concrete generates environmental damage costs of approximately 26 euros. The production of ready-mixed concrete alone (i.e. concrete produced in stationary concrete mixing plants and delivered to the construction site by concrete mixer lorries) thus generated environmental damage costs of around 3.2 billion euros in 2019. This was almost as high as the total turnover of the industry (around 4.1 billion euros).

The recycling of building materials can significantly reduce environmental damage costs. For example, the use of recycled steel reduces the environmental damage costs per tonne by at least 350 euros, and even by 970 euros for recycled aluminium.

The new “Methodological Convention 3.1 for the Assessment of Environmental Costs” is a scientifically based method of calculating the costs of environmental damage. Environmental damage costs include among others the costs of restoring damaged buildings and other infrastructure, the market value of crop losses and production losses, but also the amounts of money that people would be willing to pay to avoid damage to their health.

Compared to "Methodological Convention 3.0", the cost rates for environmental pollution were adjusted to the year 2020 and extended to include cost rates for nitrogen and phosphorus emissions, greenhouse gases in the agricultural supply chain and building materials. The cost rate for CO2 emissions rose from 180 euros/tonne in 2016 to 195 euros/tonne in 2020 due to the increasing damage over time and adjustment for inflation. If the benefits of current and future generations are weighted equally, the future damage which is then taken into account to a greater extent results in a cost rate of 680 euros/tonne for the year 2020.

The extended cost rates in “Methodological Convention 3.1“ result in the following: the application of 1 kg of nitrogen in agricultural practice results in roughly estimated environmental damage costs of 6.30 euros, and 4.44 euros for the application of 1 kg of phosphorus. With an average nitrogen surplus of 94 kg/hectare and an agricultural area of about 16.5 million hectares, this corresponds to total annual costs of approx. 11.5 billion euros in Germany alone.

Professor Messner said, “All these examples point to the significant dimension of the damage caused by environmental pollution in Germany every year. It is important to make these often overlooked costs visible because the damage caused to health and the environment is real – for our modern society, for our children and grandchildren, but also for people in other parts of the world. In the discussion about the use of pandemic recovery funds in particular, we should ensure that government funds are only used for environmentally sound projects and the transition to a green economy.”

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