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Natural systems belong to an energy network in which transformation processes connect smaller scales and larger scales. In every transformation, energy remains constant while exergy (sometimes referred to as 'available energy') at one level is consumed leaving a smaller amount at the next level.

It is recognized that different types of energy exist. Joules of energy of different kinds are not equivalent in their ability to do work. The energy that flows through all real processes is partially degraded. The second law of thermodynamics states that all real processes, including processing of energy and storage of materials, imply a dispersion of part of the energy in the form of heat. Nature is therefore organized in flows of energy of different qualities.

Odum recognized the implications of energy quality and introduced the concept of emergy (initially called 'embodied energy') to quantify the available energy (exergy) of a given type directly and indirectly used to make a product.

The type of energy chosen as reference was solar energy, since it is basically the source of all flows in the biosphere. The solar emergy (from now on simply emergy) of a product is, therefore, the solar energy (exergy) needed, directly and indirectly, to make that product.

A flow can be evaluated not only on the basis of the amount of exergy carried but also on the basis of the amount of solar energy directly and indirectly used to produce the flow. In this way, it is possible to differentiate flows of higher quality, that is, that need great quantities of energy or material for their production, from flows of low quality that need little energy or material.

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