Accounting for water and water ecosystem services in the UK (ESCoE DP 2025-01)

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Accounting for water and water ecosystem services in the UK (ESCoE DP 2025-01)

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Water is a fundamental resource for human life and life more generally. It, and the ecosystem services it provides, are under increasing pressure from human production and consumption activities. Such pressures, and their relationship to economic activities, can be tracked and monitored through water accounting through the UN-agreed System of Environmental-Economic Accounting (SEEA). This paper describes how this is done.

The SEEA (Ecosystem Accounting) advises the creation of five accounts: extent, condition and ecosystem flow – all in physical terms – and ecosystem condition and stock – in monetary terms. The information in the asset and flow accounts may be expressed in supply-and-use tables in physical and monetary terms, which allows their articulation with the System of National Accounts (SNA).

The paper discusses the European and UK experience of compiling water accounts and finds that it is patchy and in considerable need of further development in order to realise the accounting approach set out in the SEEA. It concludes with some thoughts about the relevance of this approach to water and broader environmental management in the UK.