Identifying critical supply chains and final products: An input-output approach to exploring the energy-water-food nexus

Anne Owen,Kate Scott,John Barrett

doi:10.1016/j.apenergy.2017.09.069

Abstract

Recent advances in detailed multiregional input-output databases offers new opportunities to use these environmental accounting tools to explore the interrelationships between energy, water and food–the energy-water-food nexus. This paper takes the UK asa case study and calculates energy, water and food consumption-based accounts for 1997–2013. Policies, designed to reduce the environmental impact of consumption of products, can intervene at many stages in a product’s whole life-time from ‘cradle to gate’. We use input-output analysis techniques to investigate the interaction between the energy, water and food impacts of products at different points along their supply chains, from the extraction of material and burning of energy, to the point of final consumption. We identify the twenty most important final products whose large energy, water and food impacts could be captured by various demand-side strategies such as reducing food waste or dietary changes. We then use structural-path analysis to calculate the twenty most important supply chains whose impact could be captured by resource efficiency policies which act at the point of extraction and during the manufacturing process. Finally, we recognise that strategies that aim to reduce environmental impacts should not harm the socioeconomic well-being of the UK and her trade partners and suggest that pathways should be targeted where the employment and value added dependencies are relatively low.

Highlights

Since the middle of the last century it has been recognised that multiple interlinked factors contribute to environmental change and argued that suites of composite indicators can be used to measure socio-economic and environmental wellbeing
Using Multiregional input-output (MRIO) databases to understand the role of trade in greenhouse gas (GHG) emission accounts is by far the most prominent area of research [15,16,17] in this field, but in this paper, we argue that consumption-based approaches, calculated using MRIO analysis, have great potential in understanding and quantifying energy-water-food nexus relationships
In 2013, the UK relied on imported sources for 59% of the energy, 82% of the water and 74% of the food material embodied in the products consumed by UK consumers. 49% of the employees required to produce products for UK consumers work abroad but of the GVA5 generated from UK consumption 74% remains within the UK

Summary

Introduction

Since the middle of the last century it has been recognised that multiple interlinked factors contribute to environmental change and argued that suites of composite indicators can be used to measure socio-economic and environmental wellbeing. From Boulding's Spaceship Earth essay in 1966 [1], Daly’s work on steady state economies [2], Wackernagel and Rees' ecological footprint [3] and Rockström et al.'s planetary boundaries concept [4], scientists have attempted to measure humanity’s relationship to and impact on the environment. The concept of a nexus emerged in recognition of increasing societal pressures competing for natural resources [7]. Numerous authors have studied the interrelationships and dependencies between energy, water and food since these resources are limited and depleting, whilst at the same time being fundamental for human-natural systems [8,9,10,11,12,13]. Traditional sector and country-bound governance structures often leaves energy, water and food in competition [14] but adopting a multi-centric nexus lens means that we are able to consider a system as a whole and not as a subset of isolated resources, productive sectors and consumers [5,8]

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