Trade Environmental Assessment Model (TEAM)
Environmental Economic Impacts
TEAM is a suite of software tools developed by Abt Associates for the Environmental Protection Agency (EPA) National Center for Environmental Economics to assess the environmental impacts of international trade agreements.
The ECONOMIC resolution is 4 digit NAICS sector level.
The ENVIRONMENTAL resolution TEAM currently analyzes are four separate environmental release and resource use categories: air, water, and carbon dioxide pollutants along with energy consumption by fuel type.
The GEOGRAPHIC resolution is the state level.
This tool is an exciting, and likely the first, applied environmental economic impact calculation tool. Imagine for a moment a community considering the development of an industrial park with a certain mix of industries. Wouldn’t it be useful to estimate the environmental economic impact this development could have on a regional community. TEAM can assist in this evaluation.
The EPA has done an excellent job in development, analysis, and peer review. The model is based on standard economic methodology, grounded with sources such as Duchin and Steenge, Miller and Blair, Leontief, and the National Research Council among others.
Further, as a result of the model design, outputs dovetail with; transportation, economic, land use, and environmental impact models as part of the final economic/environmental impact deliverables.
Utility Industry Economic Environmental Impact Example
This is an example of output created by the TEAM model. The example uses the sector 2211- Electric Power Generation, Transmission and Distribution to demonstrate a portion of the model functionality. This example is only scratching the surface and for introductory purposes only. In my view the possibilities for TEAM are limitless. (pdf)
I have added an example from Miller and Blair (2009), which demonstrates the matrix algebra used to create these coefficients. The process is intuitive and flexible, demonstrating the value of applied industry – environmental analysis. (pdf)
BP Gulf Oil Spill: Brownfield Site Economic Impact
Current State (June 2010)
The purpose of this post is to start organizing a framework that allows us to develop an economic impact and forecast for the BP Gulf Oil Spill. It is important to know the difference between these two analytical techniques, so it will be helpful to review the definitions.
What do we know? Not a whole lot. One reason for this is the enormity of the problem, which involves numerous disciplines, including social science, economics, environmental science, physics, engineering, statistics and in many cases, jerryrigging (MacGyver!). Many of these disciplines do not have cross-references between them, making it even more difficult to share data and information.
Building a Framework
Building an economic/ecologic framework includes some key inputs, which will grow daily and over time.
Geography: Coastal Water Shed
The geography is currently limited to the coastal counties. Here is a link to the counties located on the Gulf Coast along with a portion of their basic economic data from ESRI. From an economic and ecologic standpoint, we will need to expand this geographic definition. Here’s why:
1) Ecological impacts will likely occur in coastal watersheds. Here is a list of those counties from NOAA which identifies that specific geography.
2) These geographies are small economic areas so their economies depend on outside regions for both imports and exports. (Miller and Blair, 2009)
In particular, coastal communities rely on exports of real estate and services to visitors – and also on natural resource exports. Natural resource exports include different forms of fishing as well as oil, natural gas, salt and other mined resources. Ultimately our geography will need to include both the ecologic and economic flows between counties and regions to get a true approximate impact of the event as it unfolds. These data then can be used to create a long-term forecast.
Industry: Small and Large
Local industry is identified by reviewing BLS, QCEW data, County Business Patterns, or extracting industry data from an impact model. One of the problems with these data is that many of the businesses are small, family run operations that likely manage cash flow in unique ways. Therefore, calculating an accurate accounting of impacts will take a little work.
Timeline: Short and Long
We have a problem with the timeline since there has already been a direct environmental and economic impact. We know there is a longer – and likely larger – environmental and economic impact going forward. This will require a forecast. We know this in part because of what history has taught us about oil spills.
Environmental Impact: Exxon Valdez
One primary environmental reference is the Exxon Valdez (See Q and A) . What is particularly important about the Exxon Valdez spill is the environmental complications from this spill. Note the Exxon Valdez spill is no longer in the top 50, in terms of volume, for oil spills. However, the Exxon Valdez spill does give us an excellent estimate of expected clean-up costs.
Economic Impact: Brownfield Site
The BP Gulf oil spill economic impact and forecast has taken on a completely different dimension. The economic impact will likely run along the lines of a brownfield site. This is a very serious statement. The brownfield definition has some key components that will allow us to accurately analyze the Gulf oil spill. These include:
1) Real estate prices. Unlike the Exxon Valdez spill, the BP Gulf spill will affect millions of home and real estate owners throughout the Gulf. Even a small drop in real estate prices could represent significant monetary loses.
2) Many fishing businesses will be lost, unable to re-open or operate in the Gulf. Spending patterns for vacationers (non-real estate) will be significantly different than prior to the spill. Some raw minerals industries may not be affected at all and the rest may only see a partial impact. This is an issue of limited resources and the opportunity cost of using those resources.
3) Crude oil is difficult and expensive to eradicate from an ecosystem. Crude from the Exxon Valdez is still present today with the same level of toxicity it had 20 years ago!
4) By definition brownfield sites account for inflows and outflows of money, employment, industry and related social impacts.
The Process: It All Starts with the Data
The above defines key framework elements to a short-term impact study and long-term forecast of the spill. No doubt the Gulf will be recovering from this spill well into the future, and as data become available it will be incorporated into this framework.
Historical:
Economic Impact Studies of Exxon Valdez
Impact Research BP Gulf Oil Spill
BP Gulf Oil Spill: Brownfield Site
Definition of Brownfield from the EPA: “With certain legal exclusions and additions, the term “brownfield site” means real property, the expansion, redevelopment, or reuse of which may be complicated by the presence or potential presence of a hazardous substance, pollutant, or contaminant.”
The definition goes on to state:
“(D) ADDITIONAL AREAS- For the purposes of section 104(k), the term “brownfield site” includes a site that–
(i) meets the definition of “brownfield site” under subparagraphs (A) through (C); and
(ii)(I) is contaminated by a controlled substance (as defined in section 102 of the Controlled Substances Act (21 U.S.C. 802));
(II)(aa) is contaminated by petroleum or a petroleum product excluded from the definition of “hazardous substance” under section 101; and
bb) is a site determined by the Administrator or the State, as appropriate, to be(AA) of relatively low risk, as compared with other petroleum-only sites in the State; and
(BB) a site for which there is no viable responsible party and which will be assessed, investigated, or cleaned up by a person that is not potentially liable for cleaning up the site; and(cc) is not subject to any order issued under section 9003(h) of the Solid Waste Disposal Act (42 U.S.C. 6991b(h)); or
(III) is mine-scarred land.”
