Resource Efficiency, Decoupling and Dematerialization

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1 Resource Efficiency, Decoupling and Dematerialization Achieving human wellbeing in an equitable and environmentally sound way Heinz Schandl Senior Principal Scientist 3 April 2012 ECOSYSTEM SCIENCES DIVISION/SOCIAL AND ECONOMIC SCIENCES PROGRAM

2 Overview Background to resource efficiency and decoupling The use of natural resources in Asia and the Pacific The opportunity well designed policies may offer Presentation title Presenter name Page 2

3 What is the future going to be like? Resource Efficiency and Decoupling Heinz Schandl Page 3

4 Broadening the Compass for Decision Making GDP Employment rate Inflation rate Interest rate Stock market Flows and stocks of natural resources: materials, energy, water and land Emissions to air, water, soil Resource Efficiency and Decoupling Heinz Schandl Page 4

5 Drivers Pressure State Impact Response Framework Response Policy settings for buildings, transport and manufacturing Drivers Population, consumption, technologies Impact Economy, human and ecosystem health Pressure Material, Energy and Water Use, Waste and Emissions State Air pollution, water quality, soil erosion, biodiversity Resource Efficiency and Decoupling Heinz Schandl Page 5

6 SEEA and MEFA System of Environmental Economic Accounts Natural Capital (Source) Produced Capital (Opening Stock) Natural Capital (Sink) Material and Energy Flow Accounts Material, Energy and Water Input Capital Formation and Consumption Waste and Emissions Goods and Services Natural Capital Produced Capital (Closing Stock) Natural Capital Resource Efficiency and Decoupling Heinz Schandl Page 6

7 Natural Resources are Used and Waste and Emissions are Generated at all Steps in the Production Consumption Process Embodied Resource Use Materials, t Energy, J Water, m 3 Land, ha Stock Accumulation Buildings, infrastructure, industrial and domestic capital Products and Services, $ Waste, t Emissions, t Resource Efficiency and Decoupling Heinz Schandl Page 7

8 Environmental Impacts of Economic Activities Problem Mechanism Pressures Climate Change CO 2, N 2 O and CH 4 Energy consumption, land use, material flows Acidification SO 2, NH 4 and NO x Energy consumption, land use Eutrophication Bio accessible phosphorus and nitrogen Land use Biodiversity loss Intensive agriculture and forestry Land use, material flows, global trade Soil erosion Agricultural and forestry practices Land use Water protection Industrial effluents and municipal waste water Waste problems Manufacturing and households Material flows Depletion of natural resources Non renewable and renewable Land use, energy consumption Material flows, energy use and land use Health risks Toxic substances Biological activity Resource Efficiency and Decoupling Heinz Schandl Page 8

9 Decoupling and Dematerialization Source: UNEP 2011 Resource Efficiency and Decoupling Heinz Schandl Page 9

10 Primary Energy and Carbon Emission Costs of Human Development Source: Steinberger and Roberts 2010 Resource Efficiency and Decoupling Heinz Schandl Page 10

11 Global Natural Resource Prices Growing and more Volatile Source: McKinsey 2011 Resource Efficiency and Decoupling Heinz Schandl Page 11

12 Asia s growth in Material Use 80,000 70,000 60,000 50,000 Million tonnes 40,000 30,000 20,000 10,000 Asia-Pacific Rest of World World Source: Schandl and West 2010, UNEP 2011, West and Schandl 2012 Resource Efficiency and Decoupling Heinz Schandl Page 12

13 Domestic Material Consumption in Asia and the Pacific 40,000 35,000 Metal ores and industrial minerals Fossil fuels 30,000 Construction minerals Million tonnes 25,000 20,000 15,000 Biomass 10,000 5, Source: Schandl and West 2010, UNEP 2011, West and Schandl 2012 Resource Efficiency and Decoupling Heinz Schandl Page 13

14 The largest material consumers in Asia and the Pacific 40,000 35,000 million tonnes 30,000 25,000 20,000 15,000 10,000 5,000 China India Japan Indonesia Australia Rep of Korea Pakistan Viet Nam Thailand Malaysia Other Source: Schandl and West 2010, UNEP 2011, West and Schandl 2012 Resource Efficiency and Decoupling Heinz Schandl Page 14

15 Regional Comparison of Domestic Extraction, Physical Trade Balance and Domestic Material Consumption Domestic Material Consumption Domestic Extraction Physical Trade Balance Source: Schandl and West 2010, UNEP 2011 Resource Efficiency and Decoupling Heinz Schandl Page 15

16 Asia and the Pacific is a net importer of natural resources 1,200 1, Metal ores and industrial minerals Fossil fuels Construction minerals Biomass Million tonnes Source: Schandl and West 2010, UNEP 2011, West and Schandl 2012 Resource Efficiency and Decoupling Heinz Schandl Page 16

17 Consumption the main Driver IPAT Framework: Environmental Impact = Population x Consumption x Technology DMC = pop x GDP/pop x DMC/GDP Material Use ΔDMC billion tonnes Population logδp(%) Consumption logδc(%) Technology logδt(%) % 60% 11% % 56% 3% % 35% 34% % 48% 34% Source: Schandl and West 2010, UNEP 2011, West and Schandl 2012 Resource Efficiency and Decoupling Heinz Schandl Page 17

18 Industrial Transformation and the Role of Innovation Per capita energy use, GJ/cap Per capita material use, t/cap Population density, cap/km² Agricultural population, % Energy use per area, GJ/ha Material use per area, t/ha Share of biomass in energy use, % Agrarian regime Industrial regime Factor <50 < >80% <10% 0.1 <30 < <2 < > Source: Krausmann et al Resource Efficiency and Decoupling Heinz Schandl Page 18

19 Resource Efficiency kg/$us Asia-Pacific Rest of World World Source: Schandl and West 2010, UNEP 2011, West and Schandl 2012 Resource Efficiency and Decoupling Heinz Schandl Page 19

20 Comparing GDP, Labor productivity and resource productivity, (indexed 1980 = 100) Source: UNEP 2011 Resource Efficiency and Decoupling Heinz Schandl Page 20

21 Future Growth Source: UNEP 2011 Resource Efficiency and Decoupling Heinz Schandl Page 21

22 Comparing 3 Scenarios for Resource Use in Asia and the Pacific Business as usual Resource Efficiency Materials Systems Innovation Energy Emissions Waste GDP Unemployment Source: UNEP 2011 Resource Efficiency and Decoupling Heinz Schandl Page 22

23 Information Systems and Indicators Economic accounts Satellite accounts for Materials and waste Energy and emissions Water and Land Indicators Coupled economic and resource use modeling Policy analysis Resource Efficiency and Decoupling Heinz Schandl Page 23

24 Transformational and Incremental Policies Source: UNEP 2012 Resource Efficiency and Decoupling Heinz Schandl Page 24

25 A Short Window of Opportunity The future city of Gwanggyo, South of Seoul Resource Efficiency and Decoupling Heinz Schandl Page 25

26 Thank you Ecosystem Sciences/Social and Economic Sciences Program Dr Heinz Schandl Senior Principal Scientist t E heinz.schandl@csiro.au w ECOSYSTEM SCIENCES/SOCIAL AND ECONOMIC SCIENCES PROGRAM