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Resource Intensity and Resource Productivity
Definition
Resource intensity is a measure of the resources (e.g. materials, energy, water) required for the provision of a unit of a good or service. It is usually expressed as a ratio between resource input and product or service units provided (expressed in value, mass, volume, or other unit deemed as appropriate). Resource productivity, the inverse of resource intensity, is a measure of the output (expressed either as units produced or as economic value) per unit of resource input.
Resource productivity and resource intensity are important concepts in the sustainability debate. They are essential concepts to measure the progress of dematerialisation strategies, aimed at decoupling resource input (and the corresponding environmental burdens) from economic development. Dematerialisation refers to the absolute or relative reduction in the quantity of materials used and/or the quantity of waste produced in the generation of economic output. The objective for efficiency-led sustainability strategies is to promote dematerialisation by maximising resource productivity, while minimising resource intensity.
As stated above, resource intensity is often defined in the ecological economics literature as the ratio of materials use to value added, which in the case of an economy is equivalent to gross domestic product (GDP). The following equation summarizes this definition (modified from Cleveland and Ruth, 1999):
The equation shows that resource intensity is determined by two factors. The first term on the right-hand side of the equation is the material composition of product, which reflects changes in the mix of materials used to produce individual goods and services. The second term is the product composition of output, which reflects changes in the mix of goods produced by the economy.
The resource intensity of an economy may change due to a number of factors, namely (Cleveland and Ruth, 1999):
- Technical improvements that decrease the quantity of materials used to produce a good or service. Examples include metal use in the beverage container industry, materials use in automobile manufacture and communications.
- Substitution of new materials with more desirable properties for older materials. An example is the substitution of optical fibres for metal wire in communications.
- Changes in the structure of final demand - the mix of goods and services produced and consumed by an economy changes over time due to shifts among sectors, such as the rise of the service sector, or shifts within sectors, such as the increasing dominance of computers and other high-technology goods within the manufacturing sector.
- The saturation of bulk markets for basic materials. This line of reasoning holds that as an economy matures, there is less demand for new infrastructure such as bridges, roads, railways, steel factories, and so on, reducing the need for steel, cement, and other basic materials.
- Government regulations that alter materials use. A prominent example is the regulation of lead additives in gasoline and other products that contributed to a sharp decline in the IU of lead.
The intensity concept can be applied to different resources/pressures such as materials input, energy consumption, greenhouse gases emissions and water use. Different indicators have been used to measure resource intensity for these areas of concern.
Indicators of resource intensity
The most widely known indicator of resource intensity is MIPS – Material Intensity Per Service unit, that was proposed by Schmidt-Bleek at the Wuppertal Institute (Schmidt-Bleek, 1994). Note that the denominator in MIPS is not the amount or value of product, but the number of service units provided. The whole lifecycle from cradle to cradle (extraction, production, use, waste/recycling) is considered. MIPS can be applied in all cases where the environmental implications of products, processes and services need to be assessed and compared. A practical application of the MIPS concept is called material intensity analysis. Material intensity analyses are conducted on the micro-level (focusing on specific products and services), as well as on the macro-level (focusing on national economies). You can go for instance to http://www.wupperinst.org/en/projects/topics_online/mips/index.html for calculation and data sheets for MIPS computation as well as a set of publications on this issue.
Energy intensity is an indicator that is often used in energy policy and climate change debates. The energy intensity of an economy is a measure of the country‘s energy efficiency. It is calculated as the amount of energy consumed per unit of GDP generated in the economy. This indicator is also used to measure the energy efficiency of products and services such as appliances and buildings, vehicles and transportation systems.
Water productivity is also a widespread concept, namely in the context of agricultural water use. For example FAO – the UN Food and Agriculture Organization defines crop water productivity as the amount of water required per unit of yield‘ (http://www.fao.org/landandwater/aglw/cropwater/cwp.stm), in reality is a measure of crop water intensity.
Discussion
Several critiques have been raised on the use of concepts such as resource intensity and dematerialization as guiding principles and measuring sticks for the formulation of sustainability strategies.
First of all, indicators such as MIPS or water intensity do not tell us anything about the qualitative aspects and the environmental impacts associated with the weight of material resources or volume of water used. Different materials have quite different environmental impacts and a reduction in the amount used can actually lead to higher environmental burdens if it is the result of replacing some materials by more environmentally harmful substitutes (that are for instance scarcer or more toxic). Also, when the denominator is expressed as an economic value, an observed decrease in resource intensity may be due to a reduction in the amount of materials used or to an increase in the economic value of the products.
Another important issue is the discussion around the so-called rebound-effect‘ or Jevons‘ Paradox, which translates as the risk of increased resource productivity enabling higher economic growth. The associated increase in the scale of the economy may lead to an overall environmental burden that may outgrow the improvements achieved by increased resource productivity.