STEP 2: BUILDING COUNTRY SPECIFIC VALUATIONS Air pollutant impacts on health The health costs developed by Trucost include the cost mortality; chronic bronchitis; hospital admission; asthma attacks; restricted activity days; respiratory symptom days; congestive heart failure; chronic cough; cough and wheeze; and bronchodilator use. These costs were calculated as follow: Calculation of number of end points Trucost compiled data on the number of end points (number of health impacts) generated by the emission of one tonne of each air pollutant. In the context of health impacts, the number of end points is driven by population density, which is country specific. Development of global average health costs Trucost conducted a literature review to identify country specific studies calculating the willingness to pay to avoid the different health impacts listed above. Using these studies, Trucost built a country specific model and calculated a global average cost weighted by population for each health impact. A global average was chosen to avoid the ethical considerations of applying different values to health and life across countries. Application of global average costs Natural capital valuation coefficients for each air pollutant are obtained by multiplying the number of end points by the global health costs. Environmental impacts of other air pollutants impacts Natural capital valuations of air pollutant impacts on crops, timber, water and building materials are country specific and were calculated as follow: Literature compilation Trucost compiled data from IPA studies on the cost of air pollutants’ damages on crops, timber, water and building materials. Adjustment of the cost based on receptor densities factors Trucost adjusted the country-specific data obtained from the literature based on receptor densities such as percentage of crop or forest cover in a country. Impacts on building materials use maintenance costs which have been adjusted using purchasing power parity. Impacts on water acidification, included in the valuation of SO2 is a global average.
WATER CONSUMPTION Pressures are growing on water resources, with risks from climate change impacts increasing the unpredictability and security of supplies. Information on the benefits of water and the costs of damages from depleting resources are usually not recognised in market prices or in risk analysis. According to the Total Economic Value (TEV) framework, the value of water can be broken down into “use” values and “non-use” values (Figure 26). Use values can be further broken down into direct use, indirect use, and option values. Within direct use, the values can apply to “consumptive” or “non-consumptive” uses.179
FIGURE 26: COMPONENTS OF THE TOTAL ECONOMIC VALUE OF WATER
TOTAL ECONOMIC VALUE
USE VALUE
NON-USE VALUE
DIRECT
INDIRECT
OPTION
ALTRUISTIC
EXISTENCE
BEQUEST
CONSUMPTIVE
ECOSYSTEM FUNCTIONS
FUTURE DIRECT AND INDIRECT USE VALUES
KNOWLEDGE OF USE OF THE RESOURCE BY OTHERS
KNOWLEDGE OF EXISTENCE OF THE RESOURCE
KNOWLEDGE OF PASSING THE RESOURCE TO OTHER GENERATIONS
NON-CONSUMPTIVE
94