green economy, green growth -...
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Green Economy, Green Growth
Anders Ekbom
Sida Helpdesk for Environment and Climate Change
Center for Environmental Sustainability (GMV)
University of Gothenburg; Chalmers Univ of Technology
Purpose:
• Build capacity among Sida staff on green economy/green growth (GE/GG) issues
• Identify & Promote areas of work to operationalize Green economy in Sida (optional, follow-up)
Outline:
1. WHY Green Economy?
2. WHAT is it (conceptually, initiatives & scope)?
3. HOW do you do it (…or can do it)
4. Helpdesk-reflections on Sida’s GE-work
5. Joint Discussion, Follow-up/next steps
1900 1950 2000
Pollution: CO2, N2O, CH4
concentrations
Overfishing
Land degradation
Loss of Biodiversity
Water Depletion
Unsustainableconsumption
20
15
-20
30
Accelerating environm. pressures & urgencies
SDG Goal 8: Decent Work and Economic Growth – targets:
8.1: ”Sustain per capita economic growth in accordance with national circumstances and, in particular, at least 7% GDP growth per year in the least developed countries…”
8.4 ”…decouple economic growth from environmental degradation…”
They are all related
• Make economic policies & growth more envsustainable
• Close loops & material flows (reduce, re-use)
• Reduce pollution, inefficiencies & waste
• Economize on Natural Resource use
• Let pollutors pay
• Increase use of economic policies & instruments
• Identify & Use New indicators of econ progress
Green Economy/GG Initiatives• SDGs; Agenda 2030: Rio+20 2012: Key themes:
o Sustainable Economic Growth; Green Growth (+de-coupling)
• UNEP, UNDP, ILO, UNITAR, UNIDO: PAGE (Partnership for Action on Green
Economy) and PEI (Poverty-Env Initiative):
• Green Economy Coalition (NGO initiative; hosted by IIED)
• Global Green growth Institute (GGGI, S Korea)
• Green growth Knowledge platform (donor initiative, WB-hosted)
•OECD “Towards Green Growth”; DAC Task Force
• EU Green Plan 2020
• World Bank: “Inclusive Green Growth; Pathway to Sust. Development” (2012)
• Poverty-Env Partnership (PEP): Green Economy for Poverty Reduction
• 65 Country applications (National Green Economy strategies eg Cambodia,
Ethiopia)
Scope of Green Economy
1. Analysis: (driving forces, env damages; env management)
2. Valuation: ecosystem services, carbon, pollution, Natural
resources (NRs), env quality.
3. Govt Reviews: Public Env Expenditure reviews and Public
Env Revenue reviews
4. Designing & Implementing policy instruments: taxes,
fees, subsidies (incl. Green Investments), etc.
5. Measuring & follow up: GE/GG Indicators
3. How do you do it?
National strategic level:
• Strategy formulation; Analysis
• Design & Implement policy instruments: taxes, fees,
charges, (removing) subsidies etc.
• Measure & follow up: Identify/modify GE Indicators
• Investments: energy, transport, urban development, water
etc.; Ethiopia CRGE Strategy)
Operational level:
Project/plans/programs:
• Analyse economic driving forces to env degradation; NR
depletion in the project/plan/program area
• Design & apply economic policy instruments relevant &
useful for the project/plan/program
Carl Folke, Stockholm Resilience Centre 2016-04-21Carl Folke, Stockholm Resilience Centre
Swedish government report to Johannesburg 2002
Identify economic values of Biodiversity and Ecosystem Services => integrate in planning
Public Environm. Expenditure Review 25
Questions for departments:
Expenditure on env?
% of budget?
On what? (wasteful subsidies?)
To whom; The rich, industries?
Increasing, decreasing?
PEER in Tanzania led to env budget increase by 500%
Public Environm. Revenue Review 26
Questions for departments:
Revenues from pollution
Revenues from NR depletion? ($, % share)
Sources? Can they increase?
How? With what instruments? => Env Fiscal Reform?
3. Green Economy Policy instruments
Regulatoryinstruments
Economic instruments Voluntaryagreements
Price-based Rights-based
• Regulations• Emission standards• Product bans• Licenses, • Quotas, norms• Mandatorycertification
• Taxes, Levies• Fees• Royalties• Subsidies• Emission charges• Product charges• User fees etc.• Green bonds
•Tradablepermits: CDM, REDD+• Carbon credits• Offset schemes• Insurances (ex ARC)
• Information• Extension advice• Env certification• Eco-labeling• Codes of conduct• Info disclosure• Payment for ecosystem services
…implementation requires political will, institutional reforms & cap development
Incomes from pollution & NRs
Applications of Green economicinstruments: Water Tariffs
1. No Charge; water is free
Price ($)
Litre,
m3
Advantages
• no meter, no administration
to collect charges needed
• Simple (for consumers)
• consumers love itDisadvantages
• no awareness on value of water
• no incentive to conserve water =>
water is used unsustainably
• No revenues; Cost recovery
impossible => deteriorating services
2. Fixed (uniform) charge - Monthly water
bill independent of water volume consumed
Price ($)
Litre,
m3
Advantages
• No metering system needed
• Easy to administer
• Provides stable cash flow if set
at appropriate level
• Advantageous for big consumers
Disadvantages
• no awareness on value of water
• no incentive to conserve water
• Cost recovery difficult
• Water might be sold at higher
prices by street vendors to
households with no access
3. Increasing Block Tariff – price on water increases as consumption volume increases
Price ($)
litr
e
Advantages
• Ensures cost recovery by well
designed blocks
• Poor households connected to
the network provided with
affordable water
• Promotes water conservationDisadvantages
• Tariff design is complex
• Difficult to implement, especially
if metering system not in place
• Consumers do not pay full cost of
water supply
• Penalises large poor families
and/or shared connections
20 40
4. Lifeline tariffs - Increasing Block Tariffs, Income-adjusted price
Price ($)
litr
e
60 10020
Non-qualified users
Qualified users
Near free
basic service
Payments for
preventing
downstream
siltation
Higher fuel
prices
Cheaper
public
transport
Benefits from
agro-forestry
Payments
from avoided
deforestation
Payments for
agro-
biodiversity
Compensation
for carbon
sequestration
Phasing out of
open stoves
Higher
pesticide
prices
Tenure
security
Electrification
Stricter soil
conservation
regulations
Better market
access (ICT)
Better/more
extension
advice
New crops,
technologies
Water fees
Subsidized
improved stoves
Logging
bans
Eco-label
crops
Conservation
farming
incentives
Erosive
farming
disincentivesNew markets
(carbon)
Access to
credits
FROM TO
Min of Environment in charge Min of Finance; Min of Planning
Reliance on Env rules, command &
control
Economic incentives (env taxes,
subsidies, fees)
Brown investments dominate (oil, gas,
coal) = winners
Green investments (solar, wind,
thermal, hydro) = winners
Victims pay Polluters Pay
Re-active to env pollution, end of pipe Prevention, ”green” dominates
planning; Transformation & Integration
GDP (misguided indicators) Green indicators (SDGs; Green GDP,
Genuine savings)
Focus on Environmental protection,
conservation
Sustainable management; sectoral
environmental integration
Wasteful subsidies (water, energy,
petrol, NRs)
Optimized subsidies (waste recycling,
re-use, resource minimization)
Low public spending on environment Green tax reform; env large source of
public income
The Green Economy transformation
Summary: Attaining Green Growth
Transform sectors by:
Increasing royalties on Natural resources
• Removing subsidies on fisheries, energy, fuel
• Charges & fees on air/water pollution (PPP!)
• Payments for soil & water conservation (PES)
• Compensation for climate mitigation & avoidingdeforestation (REDD)
• Taxes on petrol, oil, water for the rich, etc.
4. Helpdesk reflections in Sida’sGreen Economy work:
A) What is missing? Experiences; Demand today in the field?
B) Challenges, needs?
A) Limited demand; most demand at country /cooperation strategy level, increasing interest!
B) Green Economy an Unused opportunity- Need for capacity building; guidance- Action plan – how to work with it; strategically, practically- Enhanced economic analysis (PEER, PERR, valuation etc.)- Increased (support to) use of env economic policy instruments in operations- New Indicators; => monitoring & follow up.