TOWARDS A RESOURCE

EFFICIENT SOCIETY

Shardul Agrawala

Head of Environment and Economy Integration Division OECD Environment Directorate Stockholm, 25 March 2015

1. THE NEED

Note: values using constant 2010 purchasing power parity (PPP) exchange rates.

Source: (OECD, 2012) OECD Environmental Outlook to 2050; output from ENV-Linkages.

3

Projections for real gross domestic product: Baseline, 2010-2050

0

50 000

100 000

150 000

200 000

250 000

300 000

350 000

2010 2015 2020 2025 2030 2035 2040 2045 2050

Bill

ions o

f consta

nt 2010 U

SD

OECD BRIICS RoW US China India

World economy will nearly quadruple by 2050

3 billion more middle-class consumers will

fuel future demand

4

Global middle class1

Billions of people

ROW

2030

3.23 Latin America

4.88

3 billion

Asia-Pacific

North America

Europe

2020

3.25

1.74

2009

1.85

0.53

1 Based on daily consumption per capita ranging from $10 to $100 (in purchasing power parity terms) Source: OECD (2011), Perspectives on Global Development: Social Cohesion in a Shifting World

0.03

Increasing extraction costs, sink saturation

Increasing cost

Atmosphere

Resource Stocks Sinks

Water

Terrestrial

72 Gt

49 Gt of GHG

228 Mt of P

12 Gt of Waste

Source: OECD/IEA data, OECD Materials Report

Extracted & used 35 Gt (1980) . . . 72 Gt (today) . . > 100 Gt

(2030) . .

SATU

RA

TION

And increasing criticality of materials (by 2030)

6

Concentration of production

Concentration of reserves

Political stability

Substitutability

Recycling

Breakdown by end-use sectors

Value added of end-use sectors

SU

PP

LY

RIS

K

ECONOMIC IMPORTANCE

CRITICALITY AREA

Al

Antimony

Barytes

Bauxite

Beryllium

Borate

Chromium

Cobalt

Coking coal

Copper

DiatomiteFeldspar

Fluorspar

Gallium

Germanium

Gold

Gypsum

Hafnium

Indium

Iron ore

Lithium

Magnesite

Magnesium

Manganese

Mo

Natural Graphite

Nickel

Niobium

PGM

Ph Rock

Potash

REE (Heavy)

REE (Light)

Rhenium

Scandium

Selenium

Silicon Metal

Ag

TantalumTelluriumTin

Titanium

Tungsten

Vanadium

Zinc

01

23

45

Su

pp

ly R

isk

.02 .04 .06 .08 .1 .12Economic Importance

CRITICALITY AREA

OECD 2015 forthcoming

2. PROGRESS TOWARDS A RESOURCE EFFICIENT SOCIETY

Some progress on decoupling materials

consumption from economic activity

50

75

100

125

150

2000 2002 2004 2006 2008 2010

Index 2000=100

material consumption

GDP

OECD

50

75

100

125

150

2000 2002 2004 2006 2008 2010

Index 2000=100

material consumption

GDP

World

But significant variation across countries

0

500

1000

1500

2000

2500

3000

3500

4000

2011 or latest available year 2000

USD/tonne

And hidden flows further alter the picture

3. EFFORTS FOR BETTER POLICIES

Policies need to address the full material

flow cycle

Industrial systems

Product/Service supply chains

Energy production

Ecological systems

Renewable resources

stocks

Non-renewable resources stocks

Finite media

Energy sources

Societal systems

Energy use

Service use

Durable product use

Consumable product use

Natural Resource policies

Product Life cycle policies

Waste Management

policies

Waste material disposal or recovery

Material harvesting Demand fulfilment

• Reduce: eco-design, Extended Producer Responsibility (EPR), green procurement

• Re-use: economic instruments (e.g. low VAT for repair work), refurbished products standards

• Recycle: Landfill and incineration taxes, EPR, PAYT, recycling targets

A diversity of instruments are being used

• Fragmented policy landscape to address specific materials, products, life-cycle stages

• Integration and coherence between policies often lacking

• Risk of shifting environmental burden from one location, or one medium, or one phase of the life-cycle to another

But…

15

Sustainable Materials Management

• Sustainable materials management, OECD working definition:

– approach to promote sustainable materials use

– integrating actions targeted at reducing negative environmental impacts and preserving natural capital

– throughout the life-cycle of materials

– taking into account economic efficiency and social equity

• Look beyond waste management to upstream life-cycle phases

• Requires the use of a policy mix, and

• Coordination across policy areas

Design of economic instruments (e.g. Extended Producer Responsibility, tradeable recycling certificates)

Sectoral and material policies (e.g. construction materials, critical materials)

Waste prevention policies

Exploring policies to support new business models, economic benefits of sustainable materials management.

Operationalising Sustainable Materials Management:

Ongoing OECD Work

http://www.oecd.org/environment/waste/