RESOURCE EFFICIENT CIRCULAR ECONOMY A VIEW FROM THE IRP OCTOBER, 20th 2016 Janez Potočnik Co-Chair UNEP International Resource Panel (IRP)

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1 RESOURCE EFFICIENT CIRCULAR ECONOMY A VIEW FROM THE IRP OCTOBER, 20th 2016 Janez Potočnik Co-Chair UNEP International Resource Panel (IRP)

2 IN THE RECENT SIX MONTH

3 SDGs offer unique opportunity to move to an integrated, universally relevant and potentially transformative Global Development Agenda.

4 Sustainable Consumption and Production is the most efficient strategy to avoid trade-offs and create synergies to resolve the development and environmental challenges articulated in the SDGs.

5 SDGs DIRECTLY DEPENDENT ON NATURAL RESOURCES

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7 A coherent account of material use in the global economy and for every nation, complementary to the System of National Accounts A large data set covering 40 years ( ) and most countries of the world. Presents direct and consumption-based material flow indicators, covering total usage, per capita use and material use per US$. Information will help identify opportunities, risks and vulnerabilities related to the global supply of primary materials and show the potential for efficiency gains and reductions in material use in the global economy

8 Annual global extraction of materials grew from 22 billion tonnes in 1970 to around 70 billion tonnes in 2010 Non-metallic minerals used in construction was the fastest growing group of materials Figure 1. Global material extraction (DE) by four material categories, , million tonnes

9 Asia and the Pacific had the largest growth, especially China and Southeast Asia Growth in Asia and the Pacific reverberated in Latin America and Africa who supplied materials to Asia Figure 2. Domestic extraction (DE) by seven subregions, , million tonnes

10 Trade has grown faster than domestic extraction and direct trade in materials has expanded fourfold since 1970 Per capita global exports of materials doubled from 0.8 tonnes per capita in 1970 to 1.6 tonnes per capita in 2010 Figure 3. Global exports of materials by four material categories, , million tonnes

11 The new indicators of raw material equivalents of imports and exports show that trade mobilizes much greater amounts of materials than direct traded flows indicate. In 2010, 30 billion tonnes of materials extracted globally were required to produce 10 billion tonnes of directly traded goods Figure 4. Raw material trade balance (RTB) by seven subregions, , million tonnes

12 Growth in per capita income and consumption have been the strongest driver of growth in material use, even more important than population growth in recent decades Figure 5. Drivers of net change in domestic material consumption between 2000 and 2010 for world regions: population, affluence, and material intensity

13 Average material footprint of medium HDI countries has grown slowly over past two decades, reaching 5 tonnes per capita, while material footprint in low HDI countries has been stagnant for the past two decades at 2.5 tonnes per capita Figure 8. Per capita material footprint (MF) by HDI level, (the HDI is a compound index on life expectancy, literacy and income)

14 Figure 6. Per-capita material footprint (MF) by seven world regions, 1990 and 2010, tonnes If current systems of production and provision for major services will not be changed, nine billion people would require about 180 billion tonnes of materials annually by 2050, almost three times today s amounts

15 Global economy now needs more materials per unit of GDP than it did at the turn of the century This has been caused by large shift of economic activity from very material-efficient economies such as Japan, the Republic of Korea and Europe to the much less material-efficient economies of China, India and Southeast Asia Figure 7. Material intensity by development status and global material intensity,

16 AND SOLUTIONS

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18 Developed economies will need to adopt strategies that bring their resource consumption down to globally sustainable levels (ABSULUTE DECOUPLING) Developing nations must strive to improve resource efficiencies and cleaner production processes as their net consumption of natural resources increases for a period until they achieve a societally acceptable quality of life (RELATIVE DECOUPLING)

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20 With concerted action, there is significant potential for increasing resource efficiency, which will have numerous benefits for the economy and the environment

21 Improving resource efficiency is indispensable for meeting climate change targets cost effectively Total anthropogenic GHG emissions (Gt CO2eq per year) by economic sector

22 CLIMATE CARBON MANAGEMENT LAND WATER GHG MATERIALS DECOUPLING RESOURCES

23 Resource efficiency can contribute to economic growth and job creation Modelling results differ in size, but all of them show that increasing resource efficiency can lead to higher economic growth and employment, often even when environmental benefits are not accounted.

24 There are substantial areas of opportunity for greater resource efficiency The top 15 categories of resource efficiency potential

25 Note: Values assume that production rates remain constant and are based on coal, metals, and minerals mining third largest energy consuming equipment is ventilation, requiring only 122 TBtu/yr. Equipment energy consumption for individual industries coal, metals and minerals is provided in nergy Appendix B, while percent contribution of each equipment type to the industry s total e Increased resource efficiency is practically consumption can be found in Appendix C attainable Energy consumption and saving potential by equipment type in US mining industry Exhibit 18. Energy Consumption and Saving Potential by Equipment Type (TBtu/Yr) rgy Consumption (Trillion Btu/Year) Ene Current Best Practice Practical Minimum Theoretical Minimum Blasting Dewatering Separations Electric Equipment Crushing Drilling Ancillary Operations Digging Ventilation Materials Handling-Diesel Grinding

26 TO CONCLUDE

27 Global material use has accelerated Material extraction grew unevenly in the global economy Trade in materials has grown dramatically Trade mobilizes primary materials extraction Consumption is a major driver of the global material use The richest countries consume on average 10 times more materials as the poorest Since 2000 we face an overall decline in material efficiency The level of well-being achieved in wealthy industrial countries cannot be generalised globally based on the same system of production and consumption!

28 Decoupling material use and environmental impacts from economic growth is essential for achieving the SDG s Decoupling will make it possible to service the needs and aspirations of a growing global population and fast-increasing world economy within the limits of available natural resources and ecosystems Technological potential for decoupling is large and the economic benefits are substantial There are many cost-effective ways for decoupling in the short and medium terms. In the long term decoupling will generate much higher economic returns than business as usual Sustainable Consumption and Production is most efficient strategy to avoid trade-offs and achieve SDGs

29 UPCOMING REPORTS Environmental benefits, risks, and trade-offs of Greenhouse Gas mitigation technologies (2016) Resource Implications of Future Urbanization (2016) Integrated scenarios of future resource demand (2017) Circular Economy, Innovation, and Remanufacturing (2017) Other recently launched IRP work streams Marine Resources Land Restoration, ecosystem resilience and their contribution to poverty reduction and livelihood opportunities Governance of resources, poverty, distribution of wealth and livelihoods Regular report (UNEA3, UNEA4)

30 THANK YOU