Victoria's environmental assets are fundamental to the Victorian economy and society. A healthy environment has unique intrinsic values, and contributes to the State's liveability and sustainability by providing clean water and air, and habitats for species, as well as being the basis for many Victorian regional industries such as agriculture and tourism.

The benefits provided by a healthy environment are inadequately captured by traditional measures of progress, such as gross domestic product or employment growth. Nor do these measures take into account the state of environmental assets and our reliance on them.

In 2012, the United Nations launched a new environmental accounting system as a framework for linking the quantity and quality of environmental assets to related socio-economic benefits.

The System of Environmental-Economic Accounting (SEEA) is an internationally accepted standard, with a set of accounting principles that can help recognise the interdependence of societies, economies and the environment.

We are developing accounting applications based on the SEEA framework to provide better, integrated and more consistent information and analysis on our environmental assets in Victoria – information about which assets have been depleted or lost, which are declining in condition, and how the health of these assets affects our well-being as a society.

This framework will support government policy, planning and investment decisions affecting the environment. It will also strengthen the ability of local government, business, not-for-profit and community stakeholders to recognise benefits of protecting and investing in the environment.

Recent work

Great Ocean Road Coasts and Parks Environmental Economic Account

The government has established a dedicated park manager, the Great Ocean Road Coast and Parks Authority (GORCAPA), for the coast and parks along the Great Ocean Road.

In addition, a periodical report on the environmental condition of the Great Ocean Road coast and parks by the Commissioner for Environmental Sustainability is required.

This environmental-economic account for the Great Ocean Road Coast and Parks (GORCAP) will also provide GORCAPA with an evidence base to inform its land management strategy, planning and investment decisions.

These baseline environmental-economic accounts for the GORCAP align with the guidance of the United Nations System of Environmental-Economic Accounting. It assesses the extent and condition of ecosystems for the GORCAP and measures the ecosystem services these natural assets provide in physical and monetary terms.

The analysis undertaken in preparing the GORCAP Environmental Economic Account (EEA) suggests that the ecosystems of the GORCAP deliver a range of ecosystem services that provide significant socio-economic value to society.

This is estimated to be worth over $100 million a year to the economy or over $700 million per year to the community for the subset of ecosystem services assessed. This includes recreation and tourism, coastal protection and climate regulation.

The report shows that the ecosystems within the GORCAP EEA boundary are important for threatened flora and fauna and deliver a range of ecosystem services that provide significant socio-economic value to society.

Impacts of the 2019-20 bushfires in eastern Victoria

DEECA applied the SEEA framework to assess the impacts of the 2019-20 bushfires in eastern Victoria.

The Ecosystem services from forests in Victoria – Impact of the 2019-20 bushfires report calculates the estimated economic impact the bushfires had on the services provided by forests in East Gippsland, Gippsland and North East Regional Forest Agreement (RFA) regions.

The report builds on the methodology and findings of an earlier report Ecosystem Services from Forests in Victoria: Assessment of Regional Forest Agreement regions.

The Report has been provided to the Victorian Regional Forest Agreements Major Event Review Panel, which is assessing the impacts of the 2019-20 bushfires on forest values, including ecosystem services. The Major Event Review will identify what if any, remedial actions need to be taken to address the impact of the 2019-20 bushfires in relation to RFAs and future forest management.

The Report identifies, and where possible, quantifies and values the impact of bushfires on forest ecosystem provisioning and regulating services.

The reader is directed to the assumptions outlined in the technical appendices of this report to minimise the risk of misinterpretation. For example, the potential influence of climate change on water supply is not considered in this study.

The impacts and dollar value estimates are assessed for the 2019-20 fire independent of other disturbances. For example, the impacts reported in this study do not account for the impact of future fires, as the timing, size and location of future fires cannot be easily forecast. However, future fires will alter the recovery of the ecosystem meaning the impacts reported in this study may not eventuate as estimated.

The reader should also note that for some ecosystem services physical and dollar value impacts are calculated over an extended period of time and this should be factored into their consideration of the report’s contents. For example, the estimated water yield loss volumes are calculated over an extended period of time but are insignificant in the context of the total catchment water yield.

Other reports

Further information

System of Environmental-Economic Accounting (SEEA)

Frequently asked questions

What is Environmental-Economic Accounting?

Environmental-Economic accounting is an integrating framework to report on the inventory of environmental assets and the services they provide in our society and economy over time, along with transactions involving spending on the environment.

How does it work?

Through measurement and valuation, the SEEA helps to compile and produce information, records and/or statistics on the environment, with a focus on biophysical information to produce consistent and comparable information on ecosystem assets and natural resources and the benefit they provide.

What will it provide?

The integrated framework provides a coherent and consistent set of information regarding environmental, social and economic statistics to support and inform policy, planning and investment decisions affecting the environment. It also provides a robust approach to consider multiple benefits and trade-offs among alternative policies or management for decision making.

How will it help to protect biodiversity?

The Environmental-Economic Accounting valuation can provide quantification of the benefits derived from both markets and non-market goods or services (or costs or welfare losses from environmental degradation or depreciation) from ecosystem assets. This contributes to a better understanding of the benefits of diverse options for projects, conservation programs or environmental policies affecting biodiversity.

How will Environmental-Economic Accounting help improve measurement and tracking of the health of the natural environment?

The Environmental-Economic Accounting enables robust evidence based decision-making and involves work to maintain and advance our capabilities to assess the status of natural resources (extent and condition), their attributes and the impacts of human interventions for better policies and decision making to sustain long term healthy environment.

Page last updated: 04/03/25