Sergio Ulgiati, University of Siena, Italy Catia Cialani, University of Foggia, Italy

1. 2nd International Conference onINTEGRATIVE APPROACHES TOWARDS SUSTAINABILITYRiga, Latvia, May 11 - 14, 2005 ENVIRONMENTAL AND THERMODYNAMIC INDICATORS IN SUPPORT OF FAIR AND SUSTAINABLE POLICY MAKINGInvestigating equitable trade among Latvia, Denmark and Italy Sergio Ulgiati, University of Siena, Italy Catia Cialani, University of Foggia, Italy

2. In this lecture we will: • Explore the role of environmental support in the economic performance of a Nation • Explore the potentiality of the emergy approach in assessing such a performance • Use the emergy approach for an assessment of trade among Latvia, Denmark and Italy • Investigate options for implementing trade balance and equity among Nations

3. Source: Payal Sampat, Scrapping Mining Dependence. In: The State of the World, 2003, The World Watch Institute. Pp. 110-135. Let’s start from Mineral Mining and Trading

4. The Point of View of the Economy: Metals and Minerals Price Index, 1960-2001

5. Mineral Dependence and Poverty RatesSelected Countries, 1990s

6. Where does wealth come from…? Resources Money

7. The Terms of Trade Imports: The purchase of goods, services and energy from abroad that leads to an outflow of currency from a country Exports: The sale of goods, services and energy to buyers from other countries leading to an inflow of currency to the country The Terms of Trade looks at the relationship between the money received for exports and the money paid for imports Average Price of Exports Terms of Trade = ---------------------------------------- Average Price of Imports

8. The Italian Terms of Trade

9. Environmental support • Everything in the biosphere is the product of a continuous self-organization activity, in which resources are degraded, cycled, and transformed via processes driven by solar energy, deep heat and gravitational potential.

10. The energy chain… At each transformation step some energy is degraded and some is passed to the next step in the chain.

11. Techno-humans… The 20th century energy food chain… (Courtesy of Mark T. Brown, 2004)

12. Environmental Accounting methods MATERIAL INTENSITY is the overall material input which humans move, divert or extract to make a product or provide a service (Wuppertal) ECOLOGICAL FOOTPRINTis the amount of appropriate productivity, expressed in hectares that is needed to sustain a given process or population (Wackernagel and Reese) EMERGYis a measure of the global environmental support to a system, expressed in unit of solar equivalent energy (seJ) (H. T. Odum)

13. Emergy Definition EMERGY - The available energy (of one form, usually solar) required directly and indirectly to make something (seJ)

14. Emergy Intensity The amount of emergy required to produce a given amount of mass or energy of a product (seJ/J; seJ/g; seJ/€) Emergy Intensity = Emergy support Output (Joules or grams) Output = Joules or grams

15. Emergy Based Indicators.

16. Signatures Signature of driving emergies for 1 hectare of Florida mangrove ecosystem (Brown and Bardi, 2001) Signature of driving emergies for 1 hectare of corn in Florida (Brandt-Williams, 2002)

17. Openness, environmental loading, density,...

18. Emergy and Money 3.48 E+24 seJ/yr (Italy, 2002) 1.44 E+12 $/yr 3.48 E+24 seJ/yr ----------------------- 1.44 E+12 $/yr 2.42 E+24 seJ/$

19. Wealth comes from resources, not from money Environmental - Economic Interface System

20. Structure of an emergy table

21. Energy Systems Diagram of Italy

22. Emergy Evaluation of Italy 2002

23. Emergy Use within the country

24. Break-down of Imports

25. Emergy signature of Italy, 2002

26. Emergy Evaluation of Latvia, 2002

27. Imports-Exports of Latvia, 2002

28. Emergy Signature of Latvia, 2002 Large dependence on: local renewable inputs comparable amounts of imported fossil fuels and commodities other than fuels.

29. Emergy Signature of Denmark, 2002 • Large dependence on: • fossil fuels (local and imported) • imports of goods and commodities other than fuels.

30. Total money paid Money from importing to exporting country (€, $) Commodities to importing country (g or J) Emergy of traded products Emergy of money paid Emergy benefit to buyer = Emergy-based terms of trade

31. Oil trade to Italy Emergy Benefit to Purchaser... Price= $ 55/barrel $ 55 (6.9 E+09 J/bbl)(9.07 E+4 seJ/J) ($ 55/bbl)(2.42 E+12 seJ/$) 4.70

32. Latvia 2.42 4.47 1 $ 1 $ 4.47 1.89 2.42 Italy 1 $ Denmark 1.89 Emergy Evaluation of Trade among countries, 2002

33. Trade of selected products

34. Conclusions 1 ) Emergy should be used to help assessing and implementing fair trade 2) Prices of commodities are unlikely to reflect equity of trade. 3) Trade equityrequires: Verydifficult Prices of primary resources exported to be much higher than the present ones Raw materials to be processed into final products at home and final product exported at higher price Possible Increased international cooperation for: Updated and reliable databases on resource exchange Equitable Trade Know how transfer,…etc… Desirable

35. Equity of International Resource Exchange “Trade and projects that unbalance local economies…and increaseemergy inequity between countries, do not maximize the world economy, because they leave major sectors of the world's population in poverty, essentially outside the world economy. This pattern wastes resources into luxury and excess of the developed countries, diverting resources that used to go directly to population support (without payments)… …This pattern is not sustainable, does not maximize world wealth and emergy, does not reinforce world production, and will not last. These patterns will become discredited as world opinion changes, as revolutions occur, and worldwide resource depletion soon cuts off the largesse of the overdeveloped countries." (H.T. Odum, 1994)

36. Thanks you for your attention