Financing the Green Economy

Transcription

1 Financing the Green Economy 1

2 Financing the Green Economy By 1

3 Financing the Green Economy By Wayne Chaman Huggins 1

4 Financing the Green Economy By Wayne Chaman Huggins Trinidad & Tobago, West Indies 1

5 Financing the Green Economy By Wayne Chaman Huggins Trinidad & Tobago, West Indies April

6 Disclaimer 2

7 Disclaimer The author is a Research Specialist in the Ministry of Planning, Housing and the Environment, Government of Trinidad and Tobago. Since 1991, he has been a consultant in the private sector on a number of Planning Studies, Environmental Impact Assessments and Social Impact Assessments. The comments and views of this paper and presentation are entirely those of the author and are not necessarily that of the Ministry of Planning, Housing and the Environment or of the Statutory Approval 2

8 Outline 3

9 Outline Key Issues and Recommendations 3

10 Outline Key Issues and Recommendations Transition Drivers 3

11 Outline Key Issues and Recommendations Transition Drivers Current Situation 3

12 Outline Key Issues and Recommendations Transition Drivers Current Situation Current Discussion 3

13 Outline Key Issues and Recommendations Transition Drivers Current Situation Current Discussion Key Assumptions 3

14 Outline Key Issues and Recommendations Transition Drivers Current Situation Current Discussion Key Assumptions Key Issues 3

15 Outline Key Issues and Recommendations Transition Drivers Current Situation Current Discussion Key Assumptions Key Issues Narrowing the Gap 3

16 Outline Key Issues and Recommendations Transition Drivers Current Situation Current Discussion Key Assumptions Key Issues Narrowing the Gap Financing the Transition & beyond 3

17 Key Issues & Recommendation 4

18 Key Issues & Recommendation Not discounting Carbon Trading 4

19 Key Issues & Recommendation Not discounting Carbon Trading Alternative modes of financing- decoupling support for Carbon based development & less green development 4

20 Key Issues & Recommendation Not discounting Carbon Trading Alternative modes of financing- decoupling support for Carbon based development & less green development Do not underestimate role of Governance 4

21 Key Issues & Recommendation Not discounting Carbon Trading Alternative modes of financing- decoupling support for Carbon based development & less green development Do not underestimate role of Governance Reengineering Institutions and laws that support Greener Economy 4

22 Key Issues & Recommendation Not discounting Carbon Trading Alternative modes of financing- decoupling support for Carbon based development & less green development Do not underestimate role of Governance Reengineering Institutions and laws that support Greener Economy Change in Public Policy 4

23 Key Issues & Recommendation 5

24 Key Issues & Recommendation Transition to Green Economy can be Financed entirely from the market place 5

25 Key Issues & Recommendation Transition to Green Economy can be Financed entirely from the market place Economic Development linked with Urbanization and Urban Living 5

26 Key Issues & Recommendation Transition to Green Economy can be Financed entirely from the market place Economic Development linked with Urbanization and Urban Living More Urbanized World, Cities and Urban areas are where most of the demand for goods and services will be generated 5

27 Key Issues & Recommendation Transition to Green Economy can be Financed entirely from the market place Economic Development linked with Urbanization and Urban Living More Urbanized World, Cities and Urban areas are where most of the demand for goods and services will be generated Greater Urbanization, more dependent on 5

28 Key Issues & Recommendation 6

29 Key Issues & Recommendation The transformation has to be selffinancing, sustainable 6

30 Key Issues & Recommendation The transformation has to be selffinancing, sustainable Much of transformation will occur in urban areas- urban population (transition drivers) 6

31 Key Issues & Recommendation The transformation has to be selffinancing, sustainable Much of transformation will occur in urban areas- urban population (transition drivers) Change in attitudes and consumption patterns 6

32 Key Issues & Recommendation The transformation has to be selffinancing, sustainable Much of transformation will occur in urban areas- urban population (transition drivers) Change in attitudes and consumption patterns New demand for services and products 6

33 Key Issues & Recommendation The transformation has to be selffinancing, sustainable Much of transformation will occur in urban areas- urban population (transition drivers) Change in attitudes and consumption patterns New demand for services and products Everyone talking about the environment 6

34 Key Issues & Recommendation 7

35 Key Issues & Recommendation The green products are not necessarily new products 7

36 Key Issues & Recommendation The green products are not necessarily new products Product- bundle of attributes 7

37 Key Issues & Recommendation The green products are not necessarily new products Product- bundle of attributes New attributes- lower energy input, use renewable energy, recycled products, lower GHG inputs- food preparation 7

38 Key Issues & Recommendation The green products are not necessarily new products Product- bundle of attributes New attributes- lower energy input, use renewable energy, recycled products, lower GHG inputs- food preparation Real environmental & other costs across entire production / supply chain 7

39 Key Issues & Recommendation 8

40 Key Issues & Recommendation Basic Needs easiest starting point 8

41 Key Issues & Recommendation Basic Needs easiest starting point More relevant to most of worlds urban population- makes a big difference to livability 8

42 Key Issues & Recommendation Basic Needs easiest starting point More relevant to most of worlds urban population- makes a big difference to livability Not really looking at exotic items here like more efficient computers and devices- no frills issue 8

43 Key Issues & Recommendation Basic Needs easiest starting point More relevant to most of worlds urban population- makes a big difference to livability Not really looking at exotic items here like more efficient computers and devices- no frills issue Clean Water 8

44 Key Issues & Recommendation Basic Needs easiest starting point More relevant to most of worlds urban population- makes a big difference to livability Not really looking at exotic items here like more efficient computers and devices- no frills issue Clean Water Sanitation & Solid Waste 8

45 Key Issues & Recommendation Basic Needs easiest starting point More relevant to most of worlds urban population- makes a big difference to livability Not really looking at exotic items here like more efficient computers and devices- no frills issue Clean Water Sanitation & Solid Waste Sewage Treatment 8

46 Key Issues & Recommendation Basic Needs easiest starting point More relevant to most of worlds urban population- makes a big difference to livability Not really looking at exotic items here like more efficient computers and devices- no frills issue Clean Water Sanitation & Solid Waste Sewage Treatment Food 8

47 Key Issues & Recommendations, an example 9

48 Key Issues & Recommendations, an example Food- along the entire chain & LCA 9

49 Key Issues & Recommendations, an example Food- along the entire chain & LCA Where grown- cost of land 9

50 Key Issues & Recommendations, an example Food- along the entire chain & LCA Where grown- cost of land Technology that reduces inputs overall 9

51 Key Issues & Recommendations, an example Food- along the entire chain & LCA Where grown- cost of land Technology that reduces inputs overall Water input 9

52 Key Issues & Recommendations, an example Food- along the entire chain & LCA Where grown- cost of land Technology that reduces inputs overall Water input type of irrigation 9

53 Key Issues & Recommendations, an example Food- along the entire chain & LCA Where grown- cost of land Technology that reduces inputs overall Water input type of irrigation Availability of water 9

54 Key Issues & Recommendations, an example Food- along the entire chain & LCA Where grown- cost of land Technology that reduces inputs overall Water input type of irrigation Availability of water Source of water- recycled vs pristine water 9

55 Key Issues & Recommendations, an example Food- along the entire chain & LCA Where grown- cost of land Technology that reduces inputs overall Water input type of irrigation Availability of water Source of water- recycled vs pristine water Cost of water 9

56 Key Issues & Recommendations, an example Food- along the entire chain & LCA Where grown- cost of land Technology that reduces inputs overall Water input type of irrigation Availability of water Source of water- recycled vs pristine water Cost of water GHG input e.g.-transportation, preparation 9

57 Transition Drivers 10

58 Transition Drivers Global Economic Development has left serious environmental issues to be addressed- imperfect markets 10

59 Transition Drivers Global Economic Development has left serious environmental issues to be addressed- imperfect markets Global Finance has supported carbon based economies 10

60 Transition Drivers Global Economic Development has left serious environmental issues to be addressed- imperfect markets Global Finance has supported carbon based economies The implications of carbon based economies not internalized- 10

61 Transition Drivers Global Economic Development has left serious environmental issues to be addressed- imperfect markets Global Finance has supported carbon based economies The implications of carbon based economies not internalized- Other environmental issues not received 10

62 Transition Drivers 11

63 Transition Drivers Aware of problems of deforestation 11

64 Transition Drivers Aware of problems of deforestation Plastic waste in oceans 11

65 Transition Drivers Aware of problems of deforestation Plastic waste in oceans GHG emissions 11

66 Transition Drivers Aware of problems of deforestation Plastic waste in oceans GHG emissions High cost of energy- fossil fuels (recent) 11

67 Transition Drivers Aware of problems of deforestation Plastic waste in oceans GHG emissions High cost of energy- fossil fuels (recent) Erratic weather patterns 11

68 Transition Drivers Aware of problems of deforestation Plastic waste in oceans GHG emissions High cost of energy- fossil fuels (recent) Erratic weather patterns Climate change- sea level rise 11

69 Transition Drivers Aware of problems of deforestation Plastic waste in oceans GHG emissions High cost of energy- fossil fuels (recent) Erratic weather patterns Climate change- sea level rise All linked to Development and Urbanization, not just industry 11

70 Current Situation 12

71 Current Situation Food, clean water and clean air undervalued and underpriced 12

72 Current Situation Food, clean water and clean air undervalued and underpriced High energy, High carbon inputsconstruction materials under valued and under priced 12

73 Current Situation Food, clean water and clean air undervalued and underpriced High energy, High carbon inputsconstruction materials under valued and under priced Cheap Fossil fuel (oil, natural gas, coal) 12

74 Current Situation Food, clean water and clean air undervalued and underpriced High energy, High carbon inputsconstruction materials under valued and under priced Cheap Fossil fuel (oil, natural gas, coal) Environmental cost - production chain? 12

75 Current Situation Food, clean water and clean air undervalued and underpriced High energy, High carbon inputsconstruction materials under valued and under priced Cheap Fossil fuel (oil, natural gas, coal) Environmental cost - production chain? Do not reflect environmental value inputs 12

76 Current Situation 13

77 Current Situation Climate change, but other environmental issues facing humanity gone largely unaddressed- no frills basic needs 13

78 Current Situation Climate change, but other environmental issues facing humanity gone largely unaddressed- no frills basic needs Current development and consumption patterns have much at stake 13

79 Current Situation Climate change, but other environmental issues facing humanity gone largely unaddressed- no frills basic needs Current development and consumption patterns have much at stake Existing investment has an interest in maintaining status quo 13

80 Current Situation Climate change, but other environmental issues facing humanity gone largely unaddressed- no frills basic needs Current development and consumption patterns have much at stake Existing investment has an interest in maintaining status quo Still pursuing cheap oil, gas and coal 13

81 Current Situation Climate change, but other environmental issues facing humanity gone largely unaddressed- no frills basic needs Current development and consumption patterns have much at stake Existing investment has an interest in maintaining status quo Still pursuing cheap oil, gas and coal Less reliant on imported fossil fuel 13

82 Current Discussion 14

83 Current Discussion Need to be more environmentally responsible- dwindling water supplies 14

84 Current Discussion Need to be more environmentally responsible- dwindling water supplies Worked well in addressing ozone depletion, acid rain, cites- ivory, movement of radioactive waste. Now climate change 14

85 Current Discussion Need to be more environmentally responsible- dwindling water supplies Worked well in addressing ozone depletion, acid rain, cites- ivory, movement of radioactive waste. Now climate change Economic Development poorly defined unless embrace a Greener Economy 14

86 Current Discussion Need to be more environmentally responsible- dwindling water supplies Worked well in addressing ozone depletion, acid rain, cites- ivory, movement of radioactive waste. Now climate change Economic Development poorly defined unless embrace a Greener Economy No consensus on how to Finance the 14

87 15

88 Key Assumptions 16

89 Change in attitude Key Assumptions 16

90 Change in attitude Key Assumptions Change in consumption pattern 16

91 Key Assumptions Change in attitude Change in consumption pattern Change in demand 16

92 Key Assumptions Change in attitude Change in consumption pattern Change in demand More urbanization 16

93 Change in attitude Key Assumptions Change in consumption pattern Change in demand More urbanization Smarter urbanization and smarter & safer buildings UN Habitat source of problems 16

94 Change in attitude Key Assumptions Change in consumption pattern Change in demand More urbanization Smarter urbanization and smarter & safer buildings UN Habitat source of problems Need for strong environmental laws and penalties 16

95 Key Assumptions 17

96 Key Assumptions Change occurring in Urban areas 17

97 Key Assumptions Change occurring in Urban areas Valuation must reflect true green or environmental inputs 17

98 Key Assumptions Change occurring in Urban areas Valuation must reflect true green or environmental inputs Environmental laws and penalties influence prices and values 17

99 Key Assumptions Change occurring in Urban areas Valuation must reflect true green or environmental inputs Environmental laws and penalties influence prices and values Prices= willingness to pay ( for a characteristic of product-greener product) 17

100 Key Assumptions Change occurring in Urban areas Valuation must reflect true green or environmental inputs Environmental laws and penalties influence prices and values Prices= willingness to pay ( for a characteristic of product-greener product) Market Demand -willingness to pay 17

101 Key Issues 18

102 Key Issues Environmental Issues / problems and the priorities not the same- depends where you are 18

103 Key Issues Environmental Issues / problems and the priorities not the same- depends where you are Need more support for basic need issues 18

104 Key Issues Environmental Issues / problems and the priorities not the same- depends where you are Need more support for basic need issues Basic needs- low price & value, income and price inelastic. 18

105 Key Issues Environmental Issues / problems and the priorities not the same- depends where you are Need more support for basic need issues Basic needs- low price & value, income and price inelastic. Basic Needs- sanitation and potable water 18

106 Key Issues Environmental Issues / problems and the priorities not the same- depends where you are Need more support for basic need issues Basic needs- low price & value, income and price inelastic. Basic Needs- sanitation and potable water Type of goods- public goods 18

107 Key Issues 19

108 Key Issues Require public infrastructure investment 19

109 Key Issues Require public infrastructure investment High Value from green valuation, low price 19

110 Key Issues Require public infrastructure investment High Value from green valuation, low price Market responds to prices 19

111 Key Issues Require public infrastructure investment High Value from green valuation, low price Market responds to prices Imperfect markets- government intervention 19

112 Key Issues Require public infrastructure investment High Value from green valuation, low price Market responds to prices Imperfect markets- government intervention Cheap fossil fuel / energy in public interest 19

113 Key Issues Require public infrastructure investment High Value from green valuation, low price Market responds to prices Imperfect markets- government intervention Cheap fossil fuel / energy in public interest Eliminate subsidies to fossil fuel, transfer these to renewable energy 19

114 Narrowing the Gap 20

115 Narrowing the Gap Turning the problem into an opportunity 20

116 Narrowing the Gap Turning the problem into an opportunity Importance of Good Governance 20

117 Narrowing the Gap Turning the problem into an opportunity Importance of Good Governance Look for changes in pricing that are emerging-refrigerants worked well 20

118 Narrowing the Gap Turning the problem into an opportunity Importance of Good Governance Look for changes in pricing that are emerging-refrigerants worked well Not an issue facing only Third World cities 20

119 Narrowing the Gap Turning the problem into an opportunity Importance of Good Governance Look for changes in pricing that are emerging-refrigerants worked well Not an issue facing only Third World cities NYC- sewage CSOs in East River- still occurring, no consensus how to address the issue but public largely unaware! 20

120 Narrowing the Gap 21

121 Narrowing the Gap Over 6Bn people, over 3Bn without toilets 21

122 Narrowing the Gap Over 6Bn people, over 3Bn without toilets Now urban issue!!! 21

123 Narrowing the Gap Over 6Bn people, over 3Bn without toilets Now urban issue!!! Changing attitudes & lifestyles, potential new demand for sanitation services 21

124 Narrowing the Gap Over 6Bn people, over 3Bn without toilets Now urban issue!!! Changing attitudes & lifestyles, potential new demand for sanitation services Curb pollution that affect clean water supplies and food 21

125 Narrowing the Gap Over 6Bn people, over 3Bn without toilets Now urban issue!!! Changing attitudes & lifestyles, potential new demand for sanitation services Curb pollution that affect clean water supplies and food Cleaner living environment 21

126 Narrowing the Gap Over 6Bn people, over 3Bn without toilets Now urban issue!!! Changing attitudes & lifestyles, potential new demand for sanitation services Curb pollution that affect clean water supplies and food Cleaner living environment Open spaces transformed 21

127 How to Finance the Transition 22

128 How to Finance the Transition Meeting the needs of low income not a priority- invisible people (>3Bn) 22

129 How to Finance the Transition Meeting the needs of low income not a priority- invisible people (>3Bn) If made a priority/ responsibility then there is opportunity cost of doing nothing 22

130 How to Finance the Transition Meeting the needs of low income not a priority- invisible people (>3Bn) If made a priority/ responsibility then there is opportunity cost of doing nothing Governance issues is key 22

131 How to Finance the Transition Meeting the needs of low income not a priority- invisible people (>3Bn) If made a priority/ responsibility then there is opportunity cost of doing nothing Governance issues is key Property rights= reshaping this to reflect environmental entitlements 22

132 How to Finance the Transition Meeting the needs of low income not a priority- invisible people (>3Bn) If made a priority/ responsibility then there is opportunity cost of doing nothing Governance issues is key Property rights= reshaping this to reflect environmental entitlements Air pollution and water pollution lawspenalties, legal requirement to address 22

133 How to Finance this Transition 23

134 How to Finance this Transition Part of physical planning standards 23

135 How to Finance this Transition Part of physical planning standards Standards must be relevant 23

136 How to Finance this Transition Part of physical planning standards Standards must be relevant Too much focus on planning for cars 23

137 How to Finance this Transition Part of physical planning standards Standards must be relevant Too much focus on planning for cars Power lines under ground 23

138 How to Finance this Transition Part of physical planning standards Standards must be relevant Too much focus on planning for cars Power lines under ground Infrastructure costs can be as high as ½ of total housing cost for detached housing 23

139 How to Finance this Transition Part of physical planning standards Standards must be relevant Too much focus on planning for cars Power lines under ground Infrastructure costs can be as high as ½ of total housing cost for detached housing More high density housing- less costly 23

140 How to Finance this Transition Part of physical planning standards Standards must be relevant Too much focus on planning for cars Power lines under ground Infrastructure costs can be as high as ½ of total housing cost for detached housing More high density housing- less costly Tremendous saving potential- more viable 23

141 How to Finance the Transition 24

142 How to Finance the Transition Different approaches to physical planning 24

143 How to Finance the Transition Different approaches to physical planning Focus on making cities and urban areas more efficient 24

144 How to Finance the Transition Different approaches to physical planning Focus on making cities and urban areas more efficient Make cities and urban areas more livable 24

145 How to Finance the Transition Different approaches to physical planning Focus on making cities and urban areas more efficient Make cities and urban areas more livable Infrastructure development needed 24

146 How to Finance the Transition Different approaches to physical planning Focus on making cities and urban areas more efficient Make cities and urban areas more livable Infrastructure development needed Avoid the costly mistakes when environmental values are not incorporated in decision making 24

147 Bon Air North Squatter site 25

148 Bon Air North Squatter site 25

149 Bon Air North Squatter site Squatting in Forested areas close to Urban centres 25

150 Bon Air North Squatter Site 26

151 Bon Air North Squatter Site 26

152 Bon Air North Squatter Site Road construction 26

153 Bon Air North Squatter Site 27

154 Bon Air North Squatter Site 27

155 Bon Air North Squatter Site Road and sewerage infrastructure 27

156 How to Finance this Transition 28

157 How to Finance this Transition Trinidad & Tobago- 0.1% on Gross Revenue- from market- for Green Fund 28

158 How to Finance this Transition Trinidad & Tobago- 0.1% on Gross Revenue- from market- for Green Fund But funds not used to mitigate these issues 28

159 How to Finance this Transition Trinidad & Tobago- 0.1% on Gross Revenue- from market- for Green Fund But funds not used to mitigate these issues Opportunity to raise large amounts of revenue 28

160 How to Finance this Transition Trinidad & Tobago- 0.1% on Gross Revenue- from market- for Green Fund But funds not used to mitigate these issues Opportunity to raise large amounts of revenue Do not exempt companies with tax holidays from environmental taxes 28

161 How to Finance this Transition Trinidad & Tobago- 0.1% on Gross Revenue- from market- for Green Fund But funds not used to mitigate these issues Opportunity to raise large amounts of revenue Do not exempt companies with tax holidays from environmental taxes Support technologies that reduce the cost of going green to make green positive, 28

162 How to Finance the Transition 29

163 How to Finance the Transition Public infrastructure funding from IDB / WB etc loans at zero interest rates 29

164 How to Finance the Transition Public infrastructure funding from IDB / WB etc loans at zero interest rates Bailout financial systems- Need to bailout all of us, Environment is Global Commons Issue as well 29

165 How to Finance the Transition Public infrastructure funding from IDB / WB etc loans at zero interest rates Bailout financial systems- Need to bailout all of us, Environment is Global Commons Issue as well SDRs (IMF) from Financial Markets- Soros 29

166 How to Finance the Transition Public infrastructure funding from IDB / WB etc loans at zero interest rates Bailout financial systems- Need to bailout all of us, Environment is Global Commons Issue as well SDRs (IMF) from Financial Markets- Soros Operation and maintenance from user fees, property taxes- occupiers. 29

167 How to Finance the Transition 30

168 How to Finance the Transition Exploit economies of scale in food preparation- improve urban feeding systems 30

169 How to Finance the Transition Exploit economies of scale in food preparation- improve urban feeding systems More efficient mass & other transportation systems 30

170 How to Finance the Transition Exploit economies of scale in food preparation- improve urban feeding systems More efficient mass & other transportation systems Government role in housing- more important in urban context (not sprawl or squatting) Lesson of Haiti here 30

171 How to Finance the Transition 31

172 How to Finance the Transition Reiterate infrastructure development reduces cost of housing services & basic needs 31

173 How to Finance the Transition Reiterate infrastructure development reduces cost of housing services & basic needs Finance Maintenance from user fees 31

174 How to Finance the Transition Reiterate infrastructure development reduces cost of housing services & basic needs Finance Maintenance from user fees Bottom line is these can be financed from the market place 31

175 How to Finance the Transition Reiterate infrastructure development reduces cost of housing services & basic needs Finance Maintenance from user fees Bottom line is these can be financed from the market place Important role of government, especially in eliminating subsidies that support 31

176 Cumulative Impact Assessment 32

177 Cumulative Impact Assessment Need to start doing things differently 32

178 Cumulative Impact Assessment Need to start doing things differently Not just identify issues, but suggest ways of financing and legislation for meaningful assessment & public consultation 32

179 Cumulative Impact Assessment Need to start doing things differently Not just identify issues, but suggest ways of financing and legislation for meaningful assessment & public consultation Since Commons issue use cross border scenarios where laws are absent or weak 32

180 Cumulative Impact Assessment Need to start doing things differently Not just identify issues, but suggest ways of financing and legislation for meaningful assessment & public consultation Since Commons issue use cross border scenarios where laws are absent or weak Valuation and Pricing, often ignored, need to be looked at very closely 32

181 Thank you 33