Transcript Green and fair economies - Home | Marshall Economics

Green and fair
economies
A review of developed and developing
countries' policies towards achieving
sustainability and fairness
What are we researching?
Aim
- To explore and analyse some examples of
countries that have attempted to make their
economies green and fair
Definition
- A green and fair economy is a country which
through its policies and longer-term plans is
working towards achieving greater
environmental sustainability alongside
reducing inequalities in the distribution of
resources, both material and natural.
Reporting to Tearfund
- A UK Christian relief and development agency
which works in over 50 countries
- Investigating the causes of the following
problem statement:
Our planet’s natural resources are finite.
Over-consumption is relentless and
already at dangerous levels. This
jeopardises the lives and well-being of
current and future generations, including
the world’s poorest people.
Structure and choice of countries
- Developed world: Sweden, Iceland, Italy and
the United Kingdom
focus on ecological innovations and
policies and on tackling relative poverty
- Developing countries: Bangladesh, Nepal and
Mongolia
focus on projects aimed at improving the
livelihoods of hundreds of thousands
through improving living standards
•
•
Sweden
Key facts:
Low population density
Significant natural resource endowments
High living standards (GDP: £347.3 billion)
Sweden is a leading green and fair
economy
Why?
Combination of societal attitudes and strong
government led effort.
Swedish government has undertaken an active
role at both a national & a local level.
Examples of government led initiatives include:
(1) Local investment programme (LIP) that
involved investing 6.2 Bn SEK in 1,814
environmental programmes across 161
municipalities from 1998-2008.
(2) A climate investment programme (from
2003) providing 900 projects with 1.8 Bn SEK
These initiatives have included everything from
waste management to sustainable living
projects.
Achievements
Significant reductions in greenhouse gas
emissions
(1) CO2 emissions have fallen by 40% since
1970
(2) S02 emissions per unit GDP is amongst the
lowest in OECD countries .
(3) Reductions in hazardous air pollutants.
Relevant policies :
(1) Regulations on fuel quality and a case-bycase licensing system for stationary sources
of air pollution
(2) C02 tax, a sulphur tax on fuel, a NO2
charge/refund system.
High proportion of usage of renewable
energies in Sweden with levels approaching
50%.
Relevant policies :
(1)Initiatives to boost energy efficiency in
industry: power-intensive industries being
granted tax relief in exchange for taking
steps to reduce energy use.
(2) Law on energy declarations
Future prospects for sustainable energy?
Markbygden wind farm involving 1,101 wind
turbines located over 450 km
It has potential to produce 8% of Sweden’s total
energy demands.
Leading recycler
Only 1% of waste in Sweden ends up as
Landfill vs. 38% for other European countries.
Sweden actually imports waste from other
European countries for its waste to energy
program.
In turn, Sweden’s waste to energy program
generates about 20 % of the country’s district
heating and electricity for a quarter-million
Swedish homes.
Relevant policies
(1) Waste collection fees based on weight as
opposed to flat fee pricing policy
( effectiveness of this has been questionable)
(2) Strong provision of recycling facilities
Welfare policies: strong welfare
state
Sweden's gini coefficient of 0.259 distinguishes
it as one of the world leaders in establishing
equality.
But, income inequality has increased recently:
from the 1990s tax on capital became flat and
in the mid-2000s the inheritance tax, and
further wealth and property taxes were
abolished.
Community specific project : Hammarby
Sjostad
Hammarby Sjostad is a district
in Sweden that has been
developed as a sustainable
neighbourhood.
Key features :
(1) Aims for residents to produce halve typical
energy consumption and water consumption.
(2) for the total energy consumption of the
30,000 people living and working in the
district to be from renewable sources i.e. use
of solar panels.
(3) Biodegradable waste is composted nearby
and recycling facilities implemented in each
apartment block.
This project is equally an example of a project
that benefited from government subsidies :
SEK
200 million of the funding for
Hammarby
Sjostad
came
from
the
government.
Outlook for Sweden’s future prospects is
positive.
(1) Post-financial crisis Sweden remains in a
much stronger position than many other
European countries with its relatively low
public debt levels and the flexibility of having
its own currency.
(2) The government appears to remain
committed to the Green economy.
i.e. it has set a zero net greenhouse emissions
Iceland
Key Facts:
- Small population
- Significant natural resource endowments
- High GDP per capita : £25,000
Key industries: fishing, manufacturing and
tourism.
As a Green and fair economy, Iceland has
a lot of potential
It is an equal society with strong incentives
from its tourism industry to become a green
one too.
Following the banking collapse in 2008 and
subsequent IMF bailout , the economy
appears to be recovering with 2012 seeing
rising output growth and a decline in
unemployment.
The government equally has ambitious plans
for future green growth and extensive green
policies.
However, there remains the risks of Iceland
seeking to expand its manufacturing sector at
the expense of its green economy.
Equally, it is difficult to find large scale evidence
of concrete projects for the future.
Achievements : Successfully exploited
sustainable sources of energy.
Electricity generated in Iceland is almost
completely generated by renewable energies
: with 73% coming from hydroelectric energy
and 22.4% from geothermal sources.
Also, involvement in promoting sustainable
energies elsewhere i.e. involved in the Global
Geothermal Development Plan, a World Bank
initiative designed to provide finance and
knowhow for geothermal assessments and
Sustainable fishing
Achieved through strong quota policies. Equally, the
government exercise temporary, seasonal and
permanent restrictions on fishing in certain areas.
Fair society through redistributive state
Pre-financial crisis Gini coefficient at about 0.25
placing Iceland high up in terms of equal societies.
A very pro-active approach in reaching gender
equality .
Emphasis on promoting and establishing gender
equality : from curbing violence against women to
promoting the position of women in the education
system and in the workplace.
Looking to the future
Issues
There has been an increase in greenhouse gas
emissions over the past ten years as a result of
expansion in Industry.
=> risk of Iceland compromising its green policies to
attract investment in industry.
However, plans for an ecological tax reform which
would place the burden on emitters are in the
pipeline.
But, overall the government does seem
committed to a green and fair economy.
The government seem to have endless proposals
and initiatives for green and fair development.
For instance, the Icelandic government intends to
reimburse ship owners up to 20% for changing to
‘greener’ vessels.
Italy
Reductions in emissions of local air pollutants
were among the largest in any OECD
country, but more than half the 30 most
polluted cities in Europe are in Italy
Greenhouse gas emissions were 6.2% below
1990 levels in 2010, compared to Kyoto
target of a 6.5% reduction in 2008-12
GDP growth: -0.9% (last quarter of 2012)
Unemployment: 9.8%
Gini coefficient: 0.319 (2011)
2. 1. Eco-enterprise culture in Italy
In Italy, one enterprise out of four - that is the
23,6% - is switching to green economy to
face crisis.
38,2% of job recruitment has been in the
“green” sectors of economy.
37,9% of enterprises introduced green
innovation in products or services in 2011.
The same trend is shown in export where
37,4% of “green enterprises” are present
in
foreign
markets,while
traditional
2.2. Italy’s clean technology: the green-lights largest
PV solar plant in Europe
SunEdison's 72-megawatt photovoltaic solar
power plant finds a home in Italy's Veneto
region, Rovigo.
In its first year of operation, the system is
expected to generate enough energy to
power approximately 16,500 homes and
prevent the emission of 40,000 tons of CO2,
which would equate to the removal of 8,000
cars from the road.
2.3 Other national and local policies
2.3.1. Raising awareness
Ongoing in Piedmont, for example, is a largescale awareness-raising campaign for the
reduction of CO2 emissions.
The 2007 National Forum for Education for
Environment and Sustainability, organised by
the MATTM and the Piedmont region,
assisted in the development and approval by
the State-Regions Conference of a new
framework for the INFEA and new financing
of EUR 10m for 2007-09.
2.3.2. Sector-specific actions
The Ministry of the Environment has promoted
an initiative regarding the mobility sector and
to which € 8.75 million have been allocated.
The vehicles can be selected from a list of
3,150 models purchasable at a discount:
2,887 are bicycles, normal or with powerassisted pedals. Moreover, this year the
amount of the incentive has increased (from
€ 250 to 700 which can cover 30% of the total
2.3.4. Training programmes to prepare the
workforce for the transition to the green
economy
- Of particular interest is an agreement between
SolarExpo (a trade fair on renewable energy
held in Verona and where exhibiting firms
have increased tenfold in the space of four
years, reaching 1000 firms and 31 countries
represented) and Adecco.
3. Cross-over of sustainability and
equality: the relevance of green policies
towards a fair economy
- Government deficit = 4.6% GDP 2010
- Inequality in income distribution remains
slightly higher than the OECD average. Atrisk-of-poverty rate is 18.2%, higher than the
EU27 average of 16.4% in 2010.
United Kingdom
1. Overview
Over a third of the UK economic growth in
2011-2012 is likely to have come from green
business and the environment
Major green trading partners include Brazil,
India, USA, Germany, Japan and China
GDP growth: 0.3%
Unemployment rate: 7.9%
National debt: 82% GDP
Gini coefficient: 0.3
2. National policies
2.1. The Climate Change Act 2008
On 26 November 2008, the Climate Acts puts a
framework to achieve a mandatory 80% cut
in the UK’s carbon emission by 2050
compared to the 1990 levels, with an
intermediate target of 34% by 2020.
2.2. Renewables Obligation
On April 2002, the obligation requires all
electricity suppliers to supply a set of portion
of their electricity from renewable sources.
The target was 3% in 2002-2003, 10.4% in
2010-2012 and 15.4% by 2015-2016.
For each eligible megawatt hour of renewable
energy generated, a tradable certificate
called a renewable obligation certificate
(ROC) is issued by OFTEM
2.3. The CRC Energy Efficiency Scheme
This is a mandatory cap and trade scheme
announced in May 2007 that apply to large
non energy-intensive organisations, including
hotel chains, supermarkets, banks, central
government and large local authorities.
It is anticipated that the scheme will have cut
carbon emissions by 1.2 million tonnes of
carbon per year by 2020.
2.4. The Green Deal
The Green Deal is a policy to encourage
energy efficiency improvements in the UK’s
building stock. It will be financed through
loans attached to the energy bills of the
improved properties.
3. Challenges
3.1. Creating more green jobs
4. UK’s opportunities and obstacles towards a fair
economy
From the Chancellor of Exchequer George
Osborne’s annual budget, income tax for the
top earners has reduced by 5%, making
direct tax less progressive. At the same time,
tax allowance will raise to £9,000 next year the amount incomes up to which will not be
taxed. This indicates the top and bottom
income earners will be better off - but the
middle income earners will be worse off,
since they might be squeezed into a higher
5. Engagement of local authorities
A report from the Nottinghamshire County
Council stated that “We have a £1million
invest to save energy efficiency scheme,
supported by £0.5million of Carbon Trust
funding, currently saving well over 1,000
tonnes of CO2 per annum from our schools
and other council buildings, through the
installation of measures such as improved
insulation, low energy lighting and better
heating controls. “
Bangladesh
Facts and figures
- 8th most densely populated country in world
- 45% of workforce employed in agriculture
- 40% of labour force underemployed
- 59% of pop. without access to electricity
- Poverty headcount ratio of 43%
- Expected growth rates of around 6% expected
for next 3 years (IMF)
- MDGs can 'probably' or 'potentially' be
achieved by 2015 (IMF)
Case study: Electrifying off-grid
rural areas using renewable energy
•
•
Between 2002 and 2012
A joint effort of the World Bank, local
communities and the govt. of Bangladesh
Grants and credit facilities given to
households to buy photovoltaic systems +
down payments made by households
Results
1.7m solar-powered systems installed
Over 4m people gained access to electricity
•
•
•
Nepal
Facts and figures
Poor quality of institutions, including political
instability and poor law and order
Highly susceptible to climate change risks
and ranks 11th in the world in terms of
vulnerability to earthquakes
Has one of the largest untapped hydropower
resources in the world
Low income country
Growth rates about 4.5% between 2009 and
•
•
•
•
•
Achievements
Rural Energy Development Programme
Micro-hydro plants installed in poorest parts
of Nepal, installation of solar home systems,
dissemination of cleaner cooking stoves
Alternative Energy Promotion Centre (AEPC)
Improving the efficiency of water mills,
subsidising solar cookers and solar dryers
Biogas support programme
More than 140,000 biogas installations built
(1992-2005), creation of 60 companies and
11000 jobs in the biogas sector
•
•
•
Mongolia
Facts and figures
Large mineral deposits
Average growth rates 8% over past 4 years
expected double-digit rates between 2013 to
2017
Decrease in poverty from 40% to 30%
between 2010 and 2011 and downward
trend throughout last decade
Substantial progress towards MDGs, but
regional disparities
•
•
•
•
•
National and regional policies
Green loans to vulnerable groups
Introduction of green loans, especially
targeted to vulnerable groups, financing
procurement of efficient cooking stoves,
solar heating systems, housing insulation
Forest management training (FAO)
Helping herders reverse deforestation and
combat illegal logging and arson through
training
•
•
Opportunities and challenges
Bangladesh - benefits from commitment of
government in both 'green' and 'fair' policies
Nepal - impressive achievements despite poor
institutions; needs more govt commitment
Mongolia - needs to manage revenues
effectively to avoid Dutch disease; needs
more govt. and local govt. involvement
Bangladesh, Nepal, Mongolia - vulnerable to
natural disasters; need to immediately tackle
issues of water management, disaster
Opportunities and challenges cont.
Sweden, Iceland - can be role models for other
countries to follow in terms of greenness and
fairness, have successfully used a multifaceted approach to green and fair growth
Italy - example of how green and fair policies as
an instrument for recovery, eco-enterprise
has the potential to create green jobs
UK - an established green and fair economy,
but current budget overlooked green and fair
considerations
Conclusion
•
•
•
Various types of policies and levels of
greenness and fairness examined
All the countries have a long way to go in
order to be fully green and fair
Difficult to present an all-encompassing view
of how a green and fair economy should look
like; political, social and economic context
should guide policy