In my column last week, I proposed the need for "environmental cost accounting". A search of Wikipedia showed an entry for "environmental true cost accounting". According to the entry, the most significant motivation for it involves "anticipating market or regulatory problems associated with ignoring the comprehensive outcome of the whole process or event accounted for." Moreover, "In green economics, this is the major concern and basis for critics of such measures as GDP." However, I am not so concerned with the failure to account for the environmental costs of various economic activities, which most people understand. I am more concerned about the implications for products and procedures purported to be environmentally friendly.

Today, an awareness of the need for conservation has increased tremendously. Those of us who want to act responsibly are at a loss as to whether we should act one way or another. Information is extremely confusing, and different groups have their own vested interests to protect. There is a need for authoritative and independent system of environmental cost accounting.

Both consumers and policy-makers are also decision-makers. Intelligent decisions cannot be made in the absence of accurate information. So the main task for environmental cost accounting is to work out the costs associated with the products and procedures.

Hong Kong, like Canada and the EU, has decided to phase out incandescent light bulbs which are inefficient and produce more heat than light. However, energy-saving light bulbs such as the compact fluorescent lamp (CFL) contain mercury vapor and can be hazardous. It is sometimes said that if they are disposed properly they are still safe. But what safeguards are there when they are disposed of they will be taken care of in the right way? Are the costs acceptable if they are not disposed off correctly? What about the use of energy and the impact on the environment when CFLs are produced?

Environmental cost accounting must include comprehensive accounting standards to measure the impact on the environment during the production, consumption, and disposal stages. Can we have a composite rating on all these three stages of the life cycle of a product?

Everybody knows that recycled paper is more expensive than regular paper. I am not overly concerned about this if the extra costs consist mainly of labor costs - given that around the world there is still considerable unemployment. But an article on the Internet says that "when the fuel, water, and energy used to transport, process, and recycled paper are taken into account, along with all the carbon and greenhouse emissions released into the atmosphere by these processes, paper recycling may actually be quite detrimental to the environment."

Right now there is a debate in Taiwan over the issue of nuclear power in the generation of electricity. Those who argue for the end of using nuclear power believe it will cost lives and hurt people's health. Clearly the public knows too little about the annual toll on people's lives and health caused by burning hydrocarbons. The furor reflects a distrust of the government of Ma Ying-jeou. But is it not possible to set up a credible environmental cost accounting body and a credible regulatory or monitoring mechanism so the public can make intelligent choices?

The world needs an independent, authoritative environmental impact assessment of alternative products and processes. These can take account of the life cycle of any product purported to be environmentally friendly. Consumers also need to be reminded that even with so-called "green products" pollution still results. Just because products are referred to as "green", it does not necessarily mean they will benefit the environment. The best we can say about them is that they do not damage the environment as much as non-green products.

The author is director of the Center for Public Policy Studies at Lingnan University.

(HK Edition 04/29/2014 page9)