Biodiversity and clean energy
Introduction
A speaker in a recent discussion on environmental issues
remarked that biodiversity always has priority over clean energy. Whatever the
truth of this statement, it prompts the question of how we should try to
resolve situations where clean energy and biodiversity are in conflict. Certainly
the frequent mention of biodiversity in the Sustainable Development Goals of
the United Nations supports its importance, but clean energy also has a role in
efforts to control climate change, and compromise may be the best policy if clean
energy projects conflict with efforts to preserve and promote biodiversity. Such
conflicts and their possible resolution will be examined below (CBD, 2018;
Global Goals, 2021).
Biodiversity and its importance
Biodiversity broadly means “all the different kinds of life”
in a given area, “the variety of animals, plants, fungi, and even microorganisms
like bacteria that make up our natural world”. It is important to us because it
“supports everything in nature that we need to survive: food, clean water,
medicine, and shelter” (WWF, 2025). Such a broad definition can be useful in
making policy, but biodiversity also has more closely defined areas of interest
such as the diversity within and between species, and variations at the levels
of DNA, ecosystem or biological function. Biodiversity is important to all the
species in the ecosystem, and its importance to humanity is easily illustrated.
Plants help to provide us with oxygen, food, shade, construction material,
medicines and fibre for clothing and paper, and their roots can help prevent
flooding. Together with animals, invertebrates and fungi, they help to keep
soil fertile and water clean. Agriculture, construction, medical, pharmaceutical
and fashion industries all depend on plants for their success (National
Geographic, 2025).
The economic value of biodiversity
Since so many economic processes depend on the natural
environment, it can be argued that nature has an economic value. This is not
the same as having a cost or a price. A natural resource such as air is vital
to human life, and could be regarded as priceless, but for people unaffected by
air pollution, there is nothing to pay. Where
air pollution is a problem, the cost of controlling it may be paid through
taxation, but is not based on a price per unit breathed. Water is priceless in
the same sense, but here the costs associated with quality, storage and
distribution may be based on the units consumed.
An article in The
Conversation asks how we can put a price on nature, which could be said to
have infinite worth. Major conservation organisations have argued in favour of
pricing the benefits that nature provides, since if we fail to do this, we risk
treating nature as if its value is zero. Advocates of this recognise that “not
all aspects of nature’s value can be captured in economic terms”: estimates
convey minimum values, and do not attempt to price aspects of nature such as
spiritual significance. A healthy environment might be represented as a pyramid
with essentials such as clean air and water and insect pollinators at the base,
above which would be “the benefits of nature for mental health, and the
transcendental aspects which give purpose and spiritual meaning.”(Conversation,
2021)
The difficulties of pricing nature somewhat resemble those
of pricing a human life, which is perhaps the prime example of something beyond
price. We nevertheless do this out of practical necessity. For example a family
cannot be compensated for the loss of a parent, but the financial element of
that loss can be offset by estimating what the future earnings of the deceased
person would have been. Likewise we sometimes estimate the value of our own
lives by deciding what we are willing to pay to reduce our risk of death in certain
circumstances. The money spent by a government on reducing the risk of death throughout
a population, perhaps through a vaccination program, gives another indication
of the price of a life, as does the cost of giving another year of healthy life
through medical treatment. However distasteful such calculations may appear, it
can be argued that they are better than the alternative of doing nothing.
Monetary valuation
For natural resources in general, a lack of monetary
valuation can be a cause of ecosystem damage and biodiversity loss. Traditional
cost–benefit analysis (CBA) economics can view environmental impacts as
‘externalities’ which are not regarded as costs. Assigning a monetary value to
such impacts through environmental valuation can give nature a place in the calculation
of financial returns which it otherwise might lack.
Some natural resources are already priced in traditional
calculations: productivity and availability of water affect the price of
agricultural land, and are termed ‘use-values’. There are also abstract
attributes such as beauty which can promote human well-being, which are termed ‘non-use-values’.
Economists can put a price on environmental services by using market data and
human behaviour to reveal peoples’ environmental preferences, or directly
through questionnaires. Such methods are
limited in accuracy, may not have secure logical foundations, and may not
achieve their desired ends. While accuracy might be improved, issues such as
whether a monetary value can be put on the extinction of a species, or how to
prevent a profitable business simply paying to damage nature are hard to
address (NEF, 2014a)
The UK’s natural environment
Despite reservations over methodology, monetary figures are
assigned to the environment: in 2023 the UK’s Office for National Statistics
published figures showing “that the total value of the stock of UK’s natural
environment in 2021 was £1.5 trillion – broadly equivalent to the value of all
the houses in the UK” (ONS, 2023). The authors “estimate the monetary value of
our natural resources by identifying a price that relates, as closely as
possible, to contributions provided by that ecosystem to the economy.” In the
absence of a market they “find the best associated price.” They can estimate
the impact of sea views on house prices, and “the savings to health budgets due
to the removal of harmful air pollution by vegetation, and the cost to the
economy to reduce carbon emissions.”
The value of the UK’s natural capital for the subsequent
year was estimated at £1.76 trillion, under headings which included provisioning
from agricultural biomass, coal, fish, minerals and metals, oil and gas, renewable
electricity, timber, wood fuel and water; regulation of air pollution, greenhouse
gases, noise, and urban heat; and various benefits related to recreation. A few
items, such as coal, made negative contributions (ONS, 2024a). The methods used
to arrive at the figures given are described in a related guide (ONS, 2024b)
which makes it clear that the methodology used “remains under development” and
that some prices are based on what “an ecosystem could charge for its services
in a theoretical market”.
Clean energy
The question posed at the beginning of this article
concerned the relative values assigned to biodiversity and clean energy. The
efforts of the Office for National Statistics to value the UK’s natural capital
suggests that in some cases the benefit of a clean energy development could be
compared in monetary terms with the environmental damage which it caused. Such
comparisons may never satisfy all the interested parties: an article on multi-criteria
analysis mentions doubts about the credibility of using market data to value
intangible attributes, and highlights the question of ‘incommensurability’ of
values – whether or not assets can all be valued on a single scale - acknowledging
that “different stakeholders have competing vested interests in how resources
are used, and will be affected in different ways by an intervention” (NEF,
2014b).
It is also the case that valuing natural capital is not identical
to valuing biodiversity, although the two are closely related. It could be
argued that while a clean energy project may damage biodiversity in a
particular area, its benefits are to the environment in general, making it
impossible to compare the two. The concept of biodiversity offsetting addresses
biodiversity damage by requiring compensating activity which improves
biodiversity elsewhere by at least as much as the damage caused. Information
about biodiversity offsetting in pilot areas in the UK described these offsets
as “conservation activities that are designed to give biodiversity benefits to
compensate for losses - ensuring that when a development damages nature (and
this damage cannot be avoided or mitigated) new nature sites will be created” (GOV.UK
2013).
Criticism of valuation
Maechler and Boisvert (2024) examine the claim that the
economic valuation of nature “contributes to making the ecological crisis more
tangible” arguing that “this approach has scarcely been applied in practice and
has therefore not yielded tangible conservation outcomes.” Promoters of economic
valuation may feel that since money is a shared language, valuation in monetary
terms would give nature a place “in all daily economic decisions”. This
viewpoint has been embodied in “natural capital accounting” which the authors
describe as “a malleable combination of accounting, statistical, economic, and
ecological techniques for counting and measuring nature, with the promise of
designing, supporting, and recording the progress of environmental policies.”
They claim that the expectations of conservation through such techniques have
not been realized.
The authors survey the development of ecological economics
from the 1980s, noting significant developments such as the Millennium
Ecosystem Assessment, the Economics of Ecosystems and Biodiversity initiative,
the Natural Capital Coalition and the Dasgupta Review, which all played a part
in developing the project of valuing nature. They note that “the monetary
valuation of nature is consistently presented as a pillar of nature
conservation … an eye-opener, which compels action and makes it impossible and
culpable to continue pleading ignorance.” It is important to fundraisers and
policy makers and has eclipsed “efforts to protect nature based on ecological
or cultural considerations” as well as arguments which hold that ecosystem
complexity cannot be reduced to a single metric, and it ignores the “fundamental
theoretical, methodological, and ontological challenges” which are involved.
Multiple approaches to valuing nature have been identified,
reflecting “diverse knowledge systems and worldviews” such as those of indigenous
peoples and local communities, and these approaches are material for a report
by the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem
Services (IPBES, 2022). This report notes that a consistent focus on monetary
and market values could increase socioenvironmental conflicts and prevent
transformative change. It sees recognition of the plurality of values as a
first step toward the structural change that would be required to halt
biodiversity loss.
The authors conclude that while economic valuation of nature
has long been presented as the way to ensure conservation, it is in fact little
used in conservation practices, and has been ”widely criticized for the
excessive and misplaced confidence it puts in the regulatory powers of the
market.” It has had the effect of “focusing attention and funding on certain
research questions” possibly to the detriment of alternative conservation
pathways.
In view of the doubts expressed above concerning economic
valuation of the environment, while it may be possible to assign potentially useful
monetary figures to the benefits of a clean energy project, and to the
biodiversity loss that it could cause, such figures should be viewed as very
approximate, subject to revision, and accounting for only some of a wide range of
important issues.
References
CBD, 2018, Biodiversity and the Sustainable Development
Goals, Convention on Biological Diversity, online, accessed 14 July 2025
https://www.cbd.int/cop/cop-14/media/briefs/en/cop14-press-brief-sdgs.pdf
Conversation, 2021, Nature:
how do you put a price on something that has infinite worth? The Conversation, online, accessed 15
July 2025
https://cordis.europa.eu/article/id/200103-pros-and-cons-of-valuing-nature
Global Goals, 2021, Affordable and Clean Energy, The Global
Goals, online, accessed 14 July 2025
https://globalgoals.org/goals/7-affordable-and-clean-energy/
GOV.UK, 2013, Biodiversity offsetting, GOV.UK, online,
accessed 29 July 2025,
https://www.gov.uk/government/collections/biodiversity-offsetting
IPBES, 2022, Summary for policymakers …, Intergovernmental
Science-Policy Platform on Biodiversity and Ecosystem Services, online,
accessed 29 July 2025
Maechler, S., Boisvert, V., 2024, Valuing Nature to Save It?
The Centrality of Valuation in the New Spirit of Conservation, Global Environmental Politics, online,
accessed 30 July 2025
https://direct.mit.edu/glep/article/24/1/10/117202/
National Geographic, 2025, Biodiversity, online, accessed 21
July 2025
https://education.nationalgeographic.org/resource/biodiversity/
NEF, 2014a, Valuing the environment in economic terms, New
Economics Foundation, online, accessed 14 July 2025
NEF, 2014b, Multi-criteria analysis, New Economics
Foundation, online, accessed 22 July 2025,
https://www.nef-consulting.co.uk/wp-content/uploads/2014/10/Multi-Criteria-Apprails-briefing.pdf
ONS, 2023, How the ONS values the natural world, Office for
National Statistics, online, accessed 22 July 2025
https://blog.ons.gov.uk/2023/11/27/how-the-ons-values-the-natural-world/
ONS, 2024a, UK natural capital accounts: 2024, Office for
National Statistics, online, accessed 24 July 2025
https://www.ons.gov.uk/economy/environmentalaccounts/bulletins/uknaturalcapitalaccounts/2024
ONS, 2024b, UK natural capital accounts methodology guide:
2024, Office for National Statistics, online, accessed 24 July 2025
WWF, 2025, What is biodiversity? WWF, online, accessed 18
July 2025
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