Externality and True Value
Case Study1 - Global Green Chemicals Public Company Limited (GGC)
Global Green Chemicals Public Company Limited (GGC) are green flagship companies of GC, whose mission is to create sustainable value products & services to stakeholders.
GGC's main products are Methyl Ester, Fatty Alcohols and Refined Glycerin, that derived from crude palm oil. This crude palm oil is produced by oil palm farmers, which is environmental friendly, reduce greenhouse gas emissions and safe for health.
The impacts form input, output and externalities from GGC business operations on society and environment are summarized as the following.
For the environmental externalities
two positive and one negative impacts are as follows:
Positive impact: Reduce GHG emissions to the atmosphere from biodiesel combustion compared to conventional fossil fuel.
Positive impact: Reduce amount of waste disposal by recycling empty palm fruit bunches for agricultural purpose
Negative impact: Limit water availability for local community from oil palm plantations.
For the social externalities
three positive and one negative impacts are as follows:
Positive impact: Improve local community well-being by increasing income from recycling waste (empty fruit bunches) for agricultural purpose.
Positive impact: Reduce people's health impact due to GHG emissions reduction to atmosphere from biodiesel combustion.
Positive impact: Improve quality of life of oil palm farmers to gain an income from selling raw material to produce Methyl Ester
Negative impact: Disturb food security of country
GGC Impact Measurement & Valuation
Therefore, the true value from the sustianable valuaiton of GGC business operation is 19,464 million THB as summarized below.
Case Study 2 - PTTMCC Biochem Company Limited (PTTMCC)
PTTMCC is a strategic joint venture between GC and Mitsubishi Chemical Corporation. PTTMCC produces BioPBS (bio-based polybutylene succinate), which is biodegradable plastic derived from sugar.
BioPBS has been used in wide range application, such as paper coating, compounding, packaging, etc.
The impacts form input, output and externalities from PTTMCC business operations on society and environment are summarized as the following.
For the environmental externalities
three positive and two negative impacts are as follows:
Positive impact: Reduce GHG emissions reduction to atmosphere from using BioPBS compared to PET.
Positive impact: Reduce amount of plastic waste to environment as BioPBSTM is biodegradable plastic.
Positive impact: Reduce wastewater by recycling molasses and bagasses to produce biogas.
Negative impact: Limit water availability for local community from sugarcane plantations.
For the social externalities
two positive and one negative impacts are as follows:
Positive impact: Reduce people's health impact due to GHG reduction to atmosphere
Positive impact: Improve quality of life of sugarcane farmers to gain an income from selling sugarcane to produce bioplastic product.
Negative impact: Disturb food security of country
For the social externalities
Therefore, the true value from the sustianable valuaiton of PTTMCC business operation is 1,441 million THB as summarized below.
Limitation:
- This valuation is a pilot/initial study, which is not a full scope study.
- This initial study uses both a primary and secondary data to be as proxies and assumptions to estimate the value of each externality and the True Value.