Investment in an energy project has several economic effects. Green accounting is a method of evaluating the effects attributable to nature and using the values for policy evaluation or to make net national product (NNP) a more comprehensive indicator of social welfare. Adjusting for the natural effects that are mediated in markets influences only the timing of amendments to NNP. It has a transitory effect, rather than the long-run effect desired in green accounting. The long-run effect that green accounting call have is to recognize the values of nonpriced environmental amenities, making them explicit inputs to decision making. (C) 2003 Elsevier Ltd. All rights reserved.