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About INCA

Ecosystem accounting framework

Ecosystem accounting is a statistical framework for organising data, tracking changes in the extent and the condition of ecosystems, measuring ecosystem services and linking this information to economic and other human activities. It aims to illustrate the benefits society receives from ecosystems and their services. The official statistical standard of ecosystem accounting is the System of Environmental-Economic Accounting (SEEA).

On 11 March 2021, the United Nations (UN) adopted a new statistical framework (the System of integrated Environmental and Economic Accounts, SEEA EA) to better account for ecosystems and ecosystem services in national economic planning and policy decision-making. This framework would enable countries to use a common set of rules and methods to track changes in ecosystems and their services.

INCA project

The European Commission supported the UN in the development of this framework with contributions from scientists, statisticians, and policymakers throughout the Knowledge Innovation Project on Integrated Natural Capital Accounting (INCA).

The INCA project is jointly undertaken by European Commission services (Eurostat, the Joint Research Centre, DG Environment and DG Research and Innovation) and the European Environment Agency.

INCA addresses key policy objectives of the EU. In the context of the European Green Deal, the EU Biodiversity Strategy for 2030 is calling for the establishment of an international natural capital accounting initiative.

The first designing phase of INCA took place in 2015. The objective of the second phase of INCA (2016-2020) was to build pilot accounts at EU level on ecosystem extent, condition and on nine ecosystem services. Thanks to the third phase of INCA (started in 2021), the pilot applications tested in phase two are becoming concrete tools and operational guidelines which enable practitioners to run on a regular basis ecosystem services accounts. Another objective of phase 2 is to develop a set of policy uses for INCA outcomes.

INCA approach

INCA has developed a series of applications based on an approach fully compliant with the SEEA EA. INCA approach (depicted below) provides an operational procedure to assess and value ecosystem services.

INCA approach
INCA approach

The ecosystem service potential represents the ecological sidethat quantifies what ecosystems can provide, independently whether there is a use or not.

The ecosystem service demand is the socio-economic side of ecosystem services that can entail economic sectors (such as agriculture, manufacturing, utility suppliers), households and (when we deal with overarching environmental targets such as climate change and biodiversity loss) the global society.

When the ecosystem service potential matches with the ecosystem service demand, an ecosystem service actual flow (use) is generated. This is the flow reported in Supply and Use tables.

When the ecosystem service potential does not match with the ecosystem service demand, we can identify three different types of mis-matches:

  • unmet demand: the absence of ecosystem able to provide the services
  • overuse: the use of the service which exceeds its regeneration or absorption rates
  • missed flow: the gap existing between what could be currently provided and what is effectively provided

Ecosystem services mis-matches accounts are complementary information and thus are not reported in official Supply and Use tables. However, they remain key to assess ecosystem and ecosystem services vulnerabilities.