Some notes about Natural Capital

Natural capital is an idea whose time has come. It takes the analysis of the environment to a new level - way beyond the conventional sustainability and sustainable development approaches which have dominated in the last couple of decades.

The reasons why natural capital is the way to think about the great environmental challenges we face is because of three characteristics. Natural capital is all about assets – the assets nature provides us with for free; it forces us to see the environment as a (or indeed the) key input into the economy – ending the apartheid between economic growth and protecting and enhancing the environment; and by focussing on capital maintenance, it makes a clear distinction between renewable and non-renewable assets.

The damage to the natural environment accelerated during the twentieth century, and now is already reducing economic growth and development. The threat of climate change is widely understood. Perhaps less so is the destruction of biodiversity and ecosystems – from the loss of the great rainforests to the declines of wild flowers, insects, birds and mammals. As these disappear this century, we will come to realise what we have lost, and how much of our economic well-being depends upon a flourishing natural environment.

To stop the rot, we need to keep the aggregate of natural capital from falling further. Indeed it needs to be improved. Not everything can be preserved, but what is damaged should be compensated for with gains elsewhere. Natural capital needs to be maintained and enhanced. For non-renewables – natural capital that can only be used once (such as oil, gas and minerals) –is a matter of which generation uses it. But when it is depleted there needs to be compensation, and the surplus revenues should be used to protect and enhance renewables  - the natural capital model just keeps on giving, provide we do not deplete it below the critical thresholds.

Natural Capital

Natural Capital

Natural Capital

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Bespoke carbon taxes on food

February 15, 2021

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  • Publication Environment DEFRA Sustainable Development Task Force: Comments on Priorities and Targets
    July 18, 2003

    Sustainable development has three principal components: environmental, social and economic growth. Targets and priorities are only comprehensible if they are related to objectives, and therefore the trade-offs between the three parts need to be defined.
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    May 23, 2003

    Foreword to publication by The Environment Agency. Over the last two decades, the case for using market-based economic instruments in environmental policy has gradually been won. Few policy makers now oppose such instruments in principle. The debate has m
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    February 14, 2001

    Published in 'A Mortgaged Future: The Consequences of UK Energy Policy', proceedings of a British Energy seminar, held before a large audience of politicians, civil servants, business people, academics and others.
  • Publication Environment Next steps in Environmental Policy and Economic Instruments
    November 30, 2000

    Paper for the DETR Academic Panel. This paper addresses what might at first sight be deemed an impossible question: how to advise government on further applications of economic instruments to environmental policy, within the constraints of not taxing the
  • Publication Water Environmental Audit Committee Inquiry into Water Pricing and the Environment
    May 25, 2000

    Memorandum of Evidence submitted to the House of Commons Environmental Audit Committee's Inquiry into Water Prices and the Environment. This memorandum focuses on: the institutional context of the water periodic review, the quadripartite process, the role
  • Publication Water Inquiry into Water Price Limits for 1999-2005: Costing the Environment
    May 25, 2000

    Memorandum of Evidence submitted to the Environmental Audit Committee. This memorandum focuses on: the institutional context of the water periodic review, the quadripartite process, the role and incentives of the water companies, and the ways in which the
  • Publication Environment Genetically Modified Organisms: Some Arguments
    April 12, 2000

    There are a variety of claims against the development and use of genetically modified organisms (GMOs). This paper examines these arguments.
  • Publication Environment Environmental Policy in the UK
    March 1, 2000

    Edited by Dieter Helm, published March 2000 by Blackwell
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