ENVIRONMENTAL DAMAGE ASSESSEMENT Giuseppe Di Marco and Angelo Maggiore APAT Italian National Agency...

ENVIRONMENTAL DAMAGE ASSESSEMENT

Giuseppe Di Marco and Angelo Maggiore

APATItalian National Agency for Environmental Protection and Technical Services

• Juridical framework for Environmental Damage Assessment

(EDA) in Italy, EU and at International (Protocol) level;

• EDA procedure;

• Application status of EDA procedure;

• Issues and problems related to EDA in water environment.

Outline of the Presentation

APAT- Italian National Agency for Environmental Protection and Technical Services

Environmental Damage and environmental goods


ENVIRONMENTAL DAMAGE adverse effect induced onto environmental goods by an anthropic

activity

ENVIRONMENTAL GOODSnatural resources (unitary or integrated), and the services they

provide to the ecosystem (ecological services), or to humans (private and public antrophic services).

D.Lgs. 152/06At Italian level

Protocol on civil liability and compensation for damage caused by the transboundary effects of

industrial accidents on transboundary waters to the 1992 Convention on the protection and use of

transboundary watercourses and international lakes and to the 1992 Convention on the transboundary

effects of industrial accidents

At International level

Directive 2004/35/CEAt EU level

Liability Regime for Environmental Damage


protected species/habitat

water bodies

EU Directive: Environmental damage

soil

Significant and measurable adverse effects on these natural resources and/or their services

Civil liability and environmental damage


Civil liability and environmental damage


EU DIRECTIVE: STRICT LIABILITY

significant adverse effects caused by DANGEROUS ACTIVITIES,UNLESS THE RESPONSIBLE PARTY DEMONSTRATES NOT TO BE AT

FAULT OR NEGLIGENT

EU DIRECTIVE: FAULT-BASED LIABILITYsignificant adverse effects on the conservation status of protected habitats and

species, caused by any activity (general environmental liability) when the responsible party has been at fault or negligent

ITALIAN LEGISLATIONextends the strict liability to any activity and the fault-based liability to any

magnitude of adverse effects on any environmental good, provided they are caused by illicit activities

THERE ARE NO FINANCIAL LIABILITY LIMITS

NO MANDATORY FINANTIAL SECURITY


The Italian legislation, in accordance with Directive 2004/35/CE, states that compensation for environmental damage can be achieved through

remediation

Compensation by Remediation

primary remediation

“MEASURES OF REINSTATEMENT” aiming at restoring natural resources, ecological and public anthropic services to/toward baseline

condition

complementary remediation

measures to compensate the fact that primary remediation does not result in full restoration (EX: EQUIVALENCY APPROACHES)

compensatory remediation

measures to compensate for interim losses (EX: RESPONSE MEASURES)


If the responsible party has carried out an illicit activity and he/she has been at fault or negligent and he/she does not remediate the damage,

Italian legislation provides that compensation can be claimed for through a payment in favour of the State of an amount of money equal

to the monetary value of environmental damage

Compensation by Patrimonial Equivalent

EU Directive 2004/35/CE does not propose any monetary compensation for damage.

Only expenses the State undertakes for restoring the impaired natural resources, and the public services provided by them can be compensated.

The monetary value of environmental damage can also be used to settle negotiated compensation agreements between the State and the responsible party, and to determine the extent of the necessary

complementary and compensatory remedial measures

30 years from the accident/emission/event

5 years from the date on which recovery measures have been completed or the responsible

party has been identified


Time limit of liability in Italy and in EU

Compensation for Environmental Damage: the Protocol


The Protocol states that the operator shall be liable for damage to transboundary water caused by an industrial accident

(Art. 4: Strict liability)

These damages include damage to environmental goods (Art. 2). The compensation of this kind of damage consists in the payment of the cost of measures of reinstatement, taken or to be undertaken, and the cost of

response measures which have been taken. When measures of reinstatement are not possible, complementary remediation measures

can be considered in order to introduce the equivalent of damaged goods into the transboundary waters

Moreover, where domestic law provides for a fault-based liability regime, the Protocol extends it to damage to transboundary water

(Art. 5: fault-based liability).


Damage determinationDamage determination

Damage quantificationDamage quantification

Monetary valuationMonetary valuation

Environmental Damage Assessment (EDA)

Complex multidisciplinary juridic, technical and economic analysis


Damage Determination

Collection and analysis of information useful to ascertain:

Environmental damage cause-effect link

Effects Damage scenario

• Measurements/analyses;

• Witnesses/photos;

• Studies/investigations;

• Source (kind of pollutant,

discharge, illicit activity);

• Exposure pathways;

• Targets


• Lack of data;• Difficult to gather further data because damage determination is usually carried out for events occurred ~2 years before;• contribution of other sources and natural fluctuations

The situation is different when dealing with industrial accidents. In this case the damage determination phase is

implemented straight away following the event and it is often facilitated by the availability of ad-hoc environmental

emergency response plans.

Problems arising in damage determination

Damage quantification


Analytical measure of the Extent, Duration and Severity of the damage in terms of:

Adverse change with respect to

baseline (ALTERATION)

Partial loss of anthropic/ecological

services (DETERIORATION)

Loss of one or more services

(PARTIAL DESTRUCTION)

Loss of all services (TOTAL

DESTRUCTION


Damage quantification, example

Increasing indicator Decreasing indicator

Alt = (Iri-Ipi)/Iri Alt = (Ipd-Ird)/Ipd

Det = (Iri-Ipi)/(Iri-Lmin) Det = (Ipd-Ird)/(Lmax-Ird)

Des=1 if Ipi<Lmin or Ipi=0 Des=1 if Ipd>Lmax[pollutant]

Lmax

Ipd

Ird

0Ipd

Ipd-Ird

Lmax-Ird

Max pollution limit

Indicator Present state

Baseline Indicator

Monitoring data Historical data Reference data Unaffected areas


Provides technical and economic elements useful for determining the economic refund of the damage itself

(compensation by patrimonial equivalent)

Monetary valuation of environmental damage

It can be

Precise Equitative

Precise valuation


When the damage involves not marketable values and it is possible to refer to primary remediation

TEV is estimated equal to:

cost of primary remediation

Components of Total Economic Value (TEV)

Use valueDirect use

Indirect use

Non use (passive) Value

Option use

Bequest value

Existence value

cost of interim loss+


Expenses which are necessary to restore deteriorated resources to baseline

Cost of a hypothetical project to monitor, control and contain, remediate and re-naturalize all deteriorated natural resources, keeping into

account:

The cost of primary remediation

Example:

unitary prize lists for these activities:

•remediation costs relative to similar situations (benefit transfer);

•public works itemized prize lists;

•market prizes for activities and supplies.

extension (volume, surface, number of individuals and species etc);


1. Compound legal interests accrued by the primary remediation cost during the unavailability period

2. Costs of measures of compensatory remediation, providing, for a period as long as the unavailability period, the same resources and

services (replacement costs). Ex: expenses which are necessary to set up and manage the recreational services of a

water body or a system for supplying drinking water

Cost of Interim Loss

3. Public defensive expenses for response measuresEx: expenses undertaken by the national health service to cope with a salubrity

deterioration)

IT CAN BE MONETARILY VALUED BY:


Precise valuation

When a reference primary remediation cannot be envisaged, it is possible to use other methods indicated by economic theories

• Replacement costs;

• Defensive expenses;

• Revealed or stated (contingent valuation) preferences.

The results are not always agreed and hence too weak and questionable to be used to claim for compensation


• Costs of some negative externalities which are not internalised by the activities that have caused the damage:

Ex: omission of payments (taxes, insurances, concession fees etc)

Equitative valuation

2. Illicit profit

When there is no conceivable primary remediation, the damage is often valuated in an equitative rather then precise way

profit earned by the responsible party during the illicit period.

costs of the best available technologies, which, if applied, would have avoided/limited environmental damage;


Application of the EDA procedure in Italy (2000-2006)

During 2000-2006 period, APAT has applied EDA

procedure in more then 205 cases


Damage determination problems in water environment

• The relevant complexity and spatio-temporal variability of the water

environment

• The rapid transport of pollutants

Investigate immediately afterwards the accident event, through inspections, suitable and prompt sampling and measuring system

• inadequate data sampling schemes;• not permanent adverse effects; • difficult to determine effects extent and severity;• uncertain baseline definition; • difficult to demonstrate cause-effect link; • difficult to estimate the necessary time for complete recovery to baseline.


The pollution capacity approach

Pollution capacity (m3) =Discharged pollutant load (kg)

Max. permissible conc. (kg/m3)

Monetary valuation of water damage can be referred to primary remediation costs of a volume of water determined as a

function of:

pollutant load discharged

maximum permissible concentrations


Conclusions

APAT has developed a complex multidisciplinary juridical, technical and economic analysis (the Environmental Damage

Assessment, EDA) capable of providing a monetary valuation of not marketable goods, like the environmental ones.

This assessment is useful to claim for monetary compensation for environmental damage that is both scientifically and legally

defensible

The compensation of environmental damage to water requires an adequate sampling and monitoring system able of distinguishing the contribution to deterioration attributable to the responsible

party, taking into account the relevant spatio-temporal variability of the water environment components and its extremely dynamic

nature.

ENVIRONMENTAL DAMAGE ASSESSEMENT Giuseppe Di Marco and Angelo Maggiore APAT Italian National Agency...

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