Classical Economics Perspectives On Ecological Engineering

One of the primary roles of economics is in assessments of costs and benefits of a system or project. The most practical applications are financial assessments that deal with classical microeconomics of market values. A market is a self-organizing economic system that balances supply of and demand for goods and services. Theoretically, the market controls production of goods and services to match the demand by consumers so that there is no excess in terms of extra supply or unmet demand. In this context, the price of a good or service is the measure of its value. Financial analyses deal only with values of costs and benefits that are determined by markets. This is the day-to-day reality of the business world in which most decisions are made.

A financial goal of ecological engineering designs is to reduce costs of a project by substituting free renewable energies, through use of natural or constructed ecosystems, for some of the purchased energies that dominate conventional alternative designs. Thus, a goal of ecological engineering is to save money. This saving may occur at any or all of the stages of the design-build-operate sequence of a project. However, it is at the operating stage of a project that savings are most likely to occur because it is here that free, renewable energies are used to drive the long-term dynamics of the ecosystem part of the design.

Perhaps the best demonstration of financial savings comes from the field of treatment wetlands which is the most advanced application of ecological engineering. Table 8.1 compares financial aspects of a conventional treatment system with a treatment wetland. Although this example leaves off the design costs, the treatment wetland is cheaper for both the construction and operating costs. Other examples of financial cost savings from treatment wetlands are given by Breaux et al. (1995), Campbell and Ogden (1999), Cueto (1993), Ko et al. (2000), and Petersen (1991), though savings do not always occur (Latchum and Kangas, 1996).

Another quality of at least some ecological engineering designs is by-products which have market value. In other words, ecologically engineered systems often generate beneficial goods that have value as by-products of the normal operation of the system. Two examples of living machines with by-product values are shown in Figure 8.1. The direct purpose of these systems is to treat wastewater and produce clean water that can be discharged back into the environment. However, they also have the ability to generate by-products that can be sold to add value to the system. The Frederick, MD, living machine was a demonstration project that treated a small portion of the domestic sewage from the local urban area (Josephson et al., 1996a,b). In this system ornamental plants and aquarium fish were produced in the tanks near the end of the living machine and sold to local businesses. At one point more than $1,000/month was generated from these sales, which was an indirect benefit of treating the wastewater. The Henderson, NV, living machine treats wastewater from

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