ALTERNATIVE APPROACHES TO ENERGY AGGREGATION
Although we argue that the more advanced economic indexing methods, such as Divisia aggregation, are the most appropriate way to aggregate energy use for investigating its role in the economy, the ecological economics literature proposes other methods of aggregation. We review two of these methods in this section and assess limits on their ability to aggregate energy use.
Other scientists propose a system of aggregating energy and materials based on exergy. Exergy measures the useful work obtainable from an energy source or material, and it is based on the chemical energy embodied in the material or energy based on its physical organization relative to a reference state. Thus, exergy measures the degree to which a material is organized relative a random assemblage of material found at an average concentration in the crust, ocean, or atmosphere. The higher the degree of concentration, the higher the exergy content. The physical units for exergy are the same as for energy or heat, namely kilocalories, joules, Btus, etc. For fossil fuels, exergy is nearly equivalent to the standard heat of combustion; for other materials, specific calculations are needed that depend on the details of the assumed conversion process.
Proponents argue that exergy has a number of useful attributes for aggregating heterogeneous energy and materials. Exergy is a property of all energy and materials and in principle can be calculated from information in handbooks of chemistry and physics and secondary studies. Thus, exergy can be used to measure and aggregate natural resource inputs as well as wastes. For these reasons, Ayres argues that exergy forms the basis for a comprehensive resource accounting framework that could ‘‘provide policy makers with a valuable set of indicators.’’ One such indicator is a general measure of ‘‘technical efficiency,’’ the efficiency with which ‘‘raw’’ exergy from animals or an inanimate source is converted into final services. A low exergy efficiency implies potential for efficiency gains for converting energy and materials into goods and services. Similarly, the ratio of exergy embodied in material wastes to exergy embodied in resource inputs is the most general measure of pollution. Some also argue that the exergy of waste streams is a proxy for their potential ecotoxicity or harm to the environment, at least in general terms.
From an accounting perspective, exergy is appealing because it is based on the science and laws of thermodynamics and thus has a well-established system of concepts, rules, and information that are available widely. However, like enthalpy, exergy should not be used to aggregate energy and material inputs aggregation because it is one-dimensional. Like enthalpy, exergy does not vary with, and hence does not necessarily reflect, attributes of fuels that determine their economic usefulness, such as energy density, cleanliness, and cost of conversion. The same is true for materials. Exergy cannot explain, for example, impact resistance, heat resistance, corrosion resistance, stiffness, space maintenance, conductivity, strength, ductility, or other properties of metals that determine their usefulness. Like prices, exergy does not reflect all the environmental costs of fuel use. The exergy of coal, for example, does not reflect coal’s contribution to global warming or its impact on human health relative to natural gas. The exergy of wastes is at best a rough first-order approximation of environmental impact because it does not vary with the specific attributes of a waste material and its receiving environment that cause harm to organisms or that disrupt biogeochemical cycles. In theory, exergy can be calculated for any energy or material, but in practice the task of assessing the hundreds (thousands?) of primary and intermediate energy and material flows in an economy is daunting.