Oil spills sp 09: Difference between revisions
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== Economic Impact == | == Economic Impact == | ||
Economic Impact | |||
The Prestige oil spill created tremendous economic damages for the affected societies in the region. Economists still struggle to assess the widespread repercussions completely since so many areas involve collective and public damages, instead of private damages. To this point, the main sectors that are most studied and assessed are the fishing industry, the seafood industry, the tourism industry, and the ongoing cleaning and recovery efforts(1). Unfortunately, the Prestige oil spill has only led to 10 million euro in total research investment compared to 270 million for the Exxon Valdez oil spill (5). Overall, the economic impact far exceeds the monetary compensation levels. | |||
Economic Assessment | |||
Some estimates of the aggregate damages over the next ten years after the spill are as high as 5 billion E (5). This type of figure is comprised of intensive studies at a more micro level with the help of biologists. Other sources identify the short-term, environmental, and cleaning and recovery costs from 2002 to 2004 at only 566.97 million E (1). Needless to say, the compensation cap of 199 million set by the 1992 Civil Liability Compensation Fund (CLC fund), the international compensation regulator, is insufficient. Subsequently, the Supplementary Fund increased the cap to $1159 million for member states in 2005, but this measure comes too late to help the affected communities (1). | |||
Galicia, in particular, accrued economic damages of about 1.57 percent of its total GDP (1). Yet, assessing damages is a challenge because of limitations due to a lack of knowledge. As of now, non-use values cannot be incorporated into the analysis, and contingent valuation has not been utilized (1). Instead, private costs to the fishing, seafood and tourism industries, as well as public damages highlighted by cleanup efforts, are valued (1). The IOPC (International Oil Pollution Compensation Funds) have received damage claims for only 743.73 m E, but only about 30% of affected individuals have applied (1). The oil spill caused a chain reaction of economic strife, but since there are no markets for passive use losses like lost recreation, true compensation equaling all costs is available and unlikely (3). | |||
Fisheries | |||
The fishing industry was devastated by the Prestige spill, with total losses for the Spanish fishing sector at 112.66 million E from 2002 to 2004 (1). In Galicia, the fishing sector employs 32,700 people directly and the Galician sector contributes 10 percent to the whole fishing industry of the EU (2). | |||
The economic valuation has been complicated by several factors that necessitate biological analysis. Specifically, these limiting factors include the morbidity effects of the oil on the fish species, the reproductive effects on the fish species, and the expansive variety of fish species in the area (1). Also, economists determined that biomass measurements of surviving fish would not be possible, so actual fish landings were used for the calculations (1). Economists compared the fish landings from previous years to the values after the spill. Incorporated in the calculation were the savings during the 2 to 11 month fishing bans that reduced input costs like labor, oil, and equipment (1). For Galicia, the study estimates that the fishing industry lost 63.08 million euro (1). | |||
Seafood | |||
The two main areas of the seafood industry apart from the fisheries affected by the spill were mussel farming and canning and fish processing. In 2003, the mussel farming industry lost 3.8 million euro for OPMEGA (the largest organization of producers), but estimates for the entire mussel sector are up to 12.83 million (1). Interestingly, the industry avoided some loss by shifting production from higher quality fresh market to lower quality industrial use (1). | |||
Economists conservatively estimate the net loss by small canning and fish processing firms during 2003 as 214,081 euro. The smallest firms were affected the most, many of them closing temporarily (1). | |||
As a whole, the seafood industry experienced a decrease of 34,000 tons and 65 million euro, as catch levels were down and prices dropped because of a loss of consumer trust (3). This sector provides about 22,600 jobs, making it a significant employer in the region and a vital part of the local economy (5). | |||
Tourism | |||
Tourism is the third industry that witnessed incredible loss due to the spill. Revenues in 2003 fell by 56.14 million euro in Galicia. This loss is partly explained by a decline in market image since many of the popular beaches were covered in oil or off-limits as volunteers tried to clean them up (5). Up to 745 beaches were affected, as well as the Atlantic Islands National Park (3). However, only private losses to tourism could be calculated accurately, so the existence-value aspect of the evaluation is absorbed by society at large. Tourism in Galicia contributes 5.7 percent of the gross added value of the local economy, so efforts to clean the coastline to enable a return of tourism were economically vital (3). | |||
Cleaning and Recovery Costs | |||
Economists estimate that the total cleaning costs following the spill reached 483.5 million euro (1). However, only 234.8 million euro was budgeted for the efforts. The money was used mostly for clean up equipment for pollution control, but the WWF criticized the budget for spending 80 percent on unnecessary, large-scale infrastructure (5). An additional 100 million euro was required to extract oil from inside the tanker (1). | |||
Labor played a huge role in the recovery efforts. Economists acknowledge that the labor costs are unusually low because of the high rate of volunteerism. Methods are available to calculate the economic contribution of this time spent, but the estimate of 4.8 million euro based off of the minimum wage is not very accurate (1). Volunteers are also controversial because any negative health effects from exposure are negative externalities (1). | |||
Other Wildlife | |||
Economists do not focus on the economic losses to other wildlife because as of now it is very difficult to precisely make any calculation. However, damages to the bird population have been calculated at 6.3 million euro based on the market price of birds determined by research after the Exxon Valdez spill (1). Hopefully, non-market based losses to the environment like these can be valued in the future to better represent the total effects of the Prestige disaster. | |||
=== Economic Assessment === | === Economic Assessment === | ||
=== Fisheries === | === Fisheries === | ||
Revision as of 04:21, 29 April 2009
The Economic and Environmental Impact of the Prestige Oil Spill
Background Information
The Prestige
The Spill
Surrounding Environment
Causes
What Went Wrong
Regulation Before the Spill
Environmental Impact
Impact on Wildlife
Aquatic Life
Birds
Impact on Fisheries
Coastal Ecosystems
Health Effects on Humans
Acute Exposure
The Prestige Oil spill affected the entire Galician coastline as well as parts of the Asturias, Cantabria, and Basque County coastlines. Affected areas were coated with a high-density crude oil, the Prestige’s own potent mixture of hydrocarbons, resins, asphaltenes, and heteromolecules. As a result of the spill’s immediate detrimental affect on natural aquatic and coastal ecosystems, thousands of volunteers were quickly mobilized to assist in the implementation of several remediation efforts. Through their work in affected areas volunteers were exposed to elevated levels of volatile organic compounds (VOCs) and other toxic substances found in crude oil. Several of the VOCs found in the Prestige fuel, such as benzene, are known carcinogens as classified by the IARC (International Agency for Research on Cancer). Other volatiles present in the oil included toluene and ethylbenzene, possible human carcinogens. Exposure to these volatiles was largely through respiratory, skin, and mucous membrane sources. Several studies conducted post-spill found that volunteers tended to have elevated levels of hydrocarbons in their lungs and other organs high in fat content.
Case Studies- Symptoms of Exposure
Key studies conducted after major remediation efforts indicated that the spill caused many health problems in volunteers. Reported health problems correlated to the spill include irritated eyes, headaches, throat irritation, and breathing difficulty. Initial data on the affects of exposure was first drawn from medical records provided by a local health service, the Plan Sanitario Combinado del Servicio Gelego de Saude. This data showed a dramatic increase in medical visits directly after the spill and for a full year after. Documented symptoms include irritated eyes, headache, throat irritation, and nausea and vomiting. A second study, done 4-6 months after the spill studied 835 participants in highly polluted areas and measured the internal exposure of workers and volunteers to toxics by measuring hydrocarbon metabolites in urine and metal concentrations in blood. This study found that VOC levels found in the blood of workers and volunteers was comparable to persons living in some of the world’s most polluted cities. Blood samples had especially high levels of light hydrocarbons such as benzene and toloune.
Long Term Health Impacts
Little research has been done on the long-term health effects of the Prestige spill. However, a study conducted 6 months after the spill by Gestal Otero determined that the spill was genetically toxic. Genetic toxicity was measured by the amount of DNA damage volunteers sustained due to beach cleanup activities and interactions with toxic substances. The study concluded that volunteers involved in cleanup activities experienced clear DNA damage. The degree of DNA damage can be correlated with the level of exposure of each person to VOCs, with those sustaining the most DNA damage being those exposed to the greatest levels of VOCs. This research, along with the identification of VOCs present in the spill as human carcinogens indicates that the spill will most likely be responsible for long-term health problems in many affected persons.
Economic Impact
Economic Impact The Prestige oil spill created tremendous economic damages for the affected societies in the region. Economists still struggle to assess the widespread repercussions completely since so many areas involve collective and public damages, instead of private damages. To this point, the main sectors that are most studied and assessed are the fishing industry, the seafood industry, the tourism industry, and the ongoing cleaning and recovery efforts(1). Unfortunately, the Prestige oil spill has only led to 10 million euro in total research investment compared to 270 million for the Exxon Valdez oil spill (5). Overall, the economic impact far exceeds the monetary compensation levels.
Economic Assessment Some estimates of the aggregate damages over the next ten years after the spill are as high as 5 billion E (5). This type of figure is comprised of intensive studies at a more micro level with the help of biologists. Other sources identify the short-term, environmental, and cleaning and recovery costs from 2002 to 2004 at only 566.97 million E (1). Needless to say, the compensation cap of 199 million set by the 1992 Civil Liability Compensation Fund (CLC fund), the international compensation regulator, is insufficient. Subsequently, the Supplementary Fund increased the cap to $1159 million for member states in 2005, but this measure comes too late to help the affected communities (1). Galicia, in particular, accrued economic damages of about 1.57 percent of its total GDP (1). Yet, assessing damages is a challenge because of limitations due to a lack of knowledge. As of now, non-use values cannot be incorporated into the analysis, and contingent valuation has not been utilized (1). Instead, private costs to the fishing, seafood and tourism industries, as well as public damages highlighted by cleanup efforts, are valued (1). The IOPC (International Oil Pollution Compensation Funds) have received damage claims for only 743.73 m E, but only about 30% of affected individuals have applied (1). The oil spill caused a chain reaction of economic strife, but since there are no markets for passive use losses like lost recreation, true compensation equaling all costs is available and unlikely (3).
Fisheries The fishing industry was devastated by the Prestige spill, with total losses for the Spanish fishing sector at 112.66 million E from 2002 to 2004 (1). In Galicia, the fishing sector employs 32,700 people directly and the Galician sector contributes 10 percent to the whole fishing industry of the EU (2). The economic valuation has been complicated by several factors that necessitate biological analysis. Specifically, these limiting factors include the morbidity effects of the oil on the fish species, the reproductive effects on the fish species, and the expansive variety of fish species in the area (1). Also, economists determined that biomass measurements of surviving fish would not be possible, so actual fish landings were used for the calculations (1). Economists compared the fish landings from previous years to the values after the spill. Incorporated in the calculation were the savings during the 2 to 11 month fishing bans that reduced input costs like labor, oil, and equipment (1). For Galicia, the study estimates that the fishing industry lost 63.08 million euro (1).
Seafood The two main areas of the seafood industry apart from the fisheries affected by the spill were mussel farming and canning and fish processing. In 2003, the mussel farming industry lost 3.8 million euro for OPMEGA (the largest organization of producers), but estimates for the entire mussel sector are up to 12.83 million (1). Interestingly, the industry avoided some loss by shifting production from higher quality fresh market to lower quality industrial use (1). Economists conservatively estimate the net loss by small canning and fish processing firms during 2003 as 214,081 euro. The smallest firms were affected the most, many of them closing temporarily (1). As a whole, the seafood industry experienced a decrease of 34,000 tons and 65 million euro, as catch levels were down and prices dropped because of a loss of consumer trust (3). This sector provides about 22,600 jobs, making it a significant employer in the region and a vital part of the local economy (5).
Tourism Tourism is the third industry that witnessed incredible loss due to the spill. Revenues in 2003 fell by 56.14 million euro in Galicia. This loss is partly explained by a decline in market image since many of the popular beaches were covered in oil or off-limits as volunteers tried to clean them up (5). Up to 745 beaches were affected, as well as the Atlantic Islands National Park (3). However, only private losses to tourism could be calculated accurately, so the existence-value aspect of the evaluation is absorbed by society at large. Tourism in Galicia contributes 5.7 percent of the gross added value of the local economy, so efforts to clean the coastline to enable a return of tourism were economically vital (3).
Cleaning and Recovery Costs Economists estimate that the total cleaning costs following the spill reached 483.5 million euro (1). However, only 234.8 million euro was budgeted for the efforts. The money was used mostly for clean up equipment for pollution control, but the WWF criticized the budget for spending 80 percent on unnecessary, large-scale infrastructure (5). An additional 100 million euro was required to extract oil from inside the tanker (1). Labor played a huge role in the recovery efforts. Economists acknowledge that the labor costs are unusually low because of the high rate of volunteerism. Methods are available to calculate the economic contribution of this time spent, but the estimate of 4.8 million euro based off of the minimum wage is not very accurate (1). Volunteers are also controversial because any negative health effects from exposure are negative externalities (1).
Other Wildlife Economists do not focus on the economic losses to other wildlife because as of now it is very difficult to precisely make any calculation. However, damages to the bird population have been calculated at 6.3 million euro based on the market price of birds determined by research after the Exxon Valdez spill (1). Hopefully, non-market based losses to the environment like these can be valued in the future to better represent the total effects of the Prestige disaster.
Economic Assessment
Fisheries
Continued Remediation
Regulation After the Spill
References
http://www.newscientist.com/article/dn4100-prestige-oil-spill-far-worse-than-thought.html http://proquest.umi.com/pqdweb?index=1&did=438008581&SrchMode=1&sid=3&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1239991859&clientId=4534 http://proquest.umi.com/pqdweb?index=0&did=242940391&SrchMode=1&sid=2&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1239991784&clientId=4534http://proquest.umi.com/pqdweb?index=10&did=1537082041&SrchMode=1&sid=1&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1239991592&clientId=4534http://proquest.umi.com/pqdweb?index=31&did=1521199841&SrchMode=1&sid=1&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1239991709&clientId=4534 http://proquest.umi.com/pqdweb?index=24&did=1526375871&SrchMode=1&sid=1&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1239991684&clientId=4534 http://proquest.umi.com/pqdweb?index=17&did=1530993371&SrchMode=1&sid=1&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1239991592&clientId=4534 http://etc-lusi.eionet.europa.eu/en_Prestige http://www.unep-wcmc.org/latenews/emergency/spain_2002_update/ http://www.sciencemag.org/cgi/content/full/314/5807/1861a?maxtoshow=&HITS=&hits=&RESULTFORMAT=&title=Spain%27s+Prestige+Oil+Spill+Resurfaces&andorexacttitle=phrase&searchid=1&FIRSTINDEX=0&volume=314&firstpage=1861&resourcetype=HWCIT
