Prague 16 th May 2013 Simon Upton Director OECD Environment Directorate For more information see wwwoecdorggreengrowth Intensity of GHG emissions and GDP Why just making steady progress isnt enough ID: 526878
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Slide1
How the OECD is thinking about Green Growth
Prague, 16
th May 2013
Simon Upton
DirectorOECD Environment Directorate
For more information, see www.oecd.org/greengrowthSlide2
Intensity of GHG emissions and GDP
(Why just making steady progress isn’t enough…)
Source
: OECD (2012),
OECD Environmental Outlook to 2050, Baseline projection using ENV-Linkages modelSlide3
Make pollution more costly
3
What policies do we need?Slide4
Revenues from environmentally related taxesIn per cent of GDP, 2011Slide5
Average tax rates on CO2 and carbon efficiency in OECD countries
Sweden
Tonnes
of carbon per PPP
equivalised
unit of GDP (EUR)
Implicit tax rate per tonne of CO2
Source:
OECD (2013) Taxing
Energy
Use - A
Graphical Analysis
USA
Estonia
Switzerland
Czech RepublicSlide6
Taxation of energy in
Czech Republic on
an energy content basisSource: OECD (2013) Taxing Energy Use - A Graphical Analysis
TRANSPORT
HEATING & PROCESS USE
ELECTRICITYSlide7
Taxation of energy in
Czech Republic on a carbon emission basis
Source: OECD (2013) Taxing Energy Use - A Graphical Analysis
TRANSPORT
HEATING & PROCESS USE
ELECTRICITYSlide8
Taxation of energy in
Austria on energy content
basisSource: OECD (2013) Taxing Energy Use - A Graphical Analysis
TRANSPORT
HEATING & PROCESS USE
ELECTRICITYSlide9
Taxation of energy in
Austria
on a carbon emission basisSource: OECD (2013) Taxing Energy Use - A Graphical Analysis
TRANSPORT
HEATING & PROCESS USE
ELECTRICITYSlide10
Share of CO2
emissions from energy taxed and implicit rates
Share of carbon emissions, %Source: OECD (2013) Taxing
Energy Use - A
Graphical AnalysisSlide11
Challenges are so big that we can’t afford expensive solutions Slide12
“Average effective carbon price" for the main policy instruments used in the electricity generation sector
$USD costs per tonne of CO
2 abatedSource: OECD Effective Carbon Prices Analysis (forthcoming)
775
800
Simple AverageSlide13
Make pollution more costly
Value and price the natural assets and ecosystem services13
Environmental Outlook to 2050: What policies do we need?Slide14
Sub-Saharan Africa – capital depletion
Sub-Saharan Africa
7.6%
+3.3%
-16.1%
-1.0%
Net saving
Education
Resource depletion
Pollution
-6.2%
% of GNI
Adjusted net savings
28% of wealth
Source: World Bank
Wealth of Nations
USD 2005, per capita Slide15
Norway – capital substitution
% of GNI
Net saving
26.2%
+6.0%
Education
-16.1%
Resource depletion
-0.1%
Pollution
Norway
16.2%
Adjusted net savings
OECD average, 6.8%
Source: World Bank
Wealth of Nations
Wealth
Savings rate
USD 2005, per capitaSlide16
The System of Environmental-Economic Accounting (SEEA) – A framework for measuring interactions between the environment and the economySlide17
High level messages from UK NEA synthesis report
Source: DEFRASlide18
Monetised impacts 2000-2060 under different scenarios – UK NEA
Source: DEFRASlide19
Make pollution more costly
Value and price the natural assets and ecosystem servicesRemove environmentally harmful subsidies
19Environmental Outlook to 2050: What policies do we need?Slide20
20
Support to fossil fuels in OECD countries by year and type of fuel (Millions of current USD)
Notes: The above charts are based on an arithmetic sum of the individual support measures identified for all 34 OECD member countries. It includes the value of tax relief measured under each jurisdiction’s benchmark tax treatment. The estimates do not take into account interactions that
may occur if multiple measures were to be removed at the same time. PSE = Producer Support Estimate; CSE = Consumer Support Estimate; GSSE = General Services Support Estimate
Data source: OECD (2013), Inventory of Estimated Budgetary Support and Tax Expenditures for Fossil Fuels.Slide21
21
Support to fossil fuels in OECD countries by year and indicator (Millions of current USD)
Notes: The above charts are based on an arithmetic sum of the individual support
measures identified for all 34 OECD member countries. It includes the value of tax relief measured under each jurisdiction’s benchmark tax treatment. The estimates do not take into account
interactions that may occur if multiple measures were to be removed at the same time. PSE = Producer Support Estimate; CSE = Consumer Support Estimate; GSSE = General Services Support EstimateData source: OECD (2013), Inventory of Estimated Budgetary Support and Tax Expenditures for Fossil Fuels.Slide22
22
Consumer support element to fossil fuels in Czech Republic by year and fuel (Millions of
CZK, nominal)Notes: Tax expenditures for any given country are measured with reference to a benchmark tax treatment that is generally specific to that country. Consequently, the estimates contained in the table above are not necessarily comparable with estimates for other countries. In addition, because of the potential interaction between them, the summation of individual measures for a specific country may be problematic. The allocation of particular measures across fuel types was done by the OECD Secretariat based on the IEA’s Energy Balances
.
Data source: OECD (2013), Inventory of Estimated Budgetary Support and Tax Expenditures for Fossil Fuels.Support for oil
Support for coal
Support for gasSlide23
Make pollution more costly
Value and price the natural assets and ecosystem servicesRemove environmentally harmful subsidies
Devise effective regulations and standardsEncourage green innovation23
Environmental Outlook to 2050:
What policies do we need?Slide24
“…large leaps in clean technology, triggering a structural shift in the way we produce and consume energy, are required. This is a ‘green growth’ rather than a ‘no growth’ world. The continuation of growth in value to humans is consistent with us living within the material constraints imposed by a finite (if very large) planet, provided that we continue to expand the intellectual economy through innovation, technology development, an increased focus on services and, more fundamentally, the art of living.”
Forthcoming as Hepburn, C. and Bowen, A. (2013), ‘Prosperity with growth: Economic growth, climate change and environmental limits’ in Fouquet, R. (ed.),
Handbook of Energy and Climate Change, Edward Elgar 24Slide25
Israeli freshwater use (2009)a
Or latest available yearSource: OECD, Environment Directorate.
25Slide26
Source: OECD (2010),
OECD Review of Agricultural Policies: Israel, 2010 .
26Israeli economic efficiency of agricultural water use, 1986-2008
Value of agricultural production per m
3
of water utilized for irrigation
Real price of fresh water to agriculture (inflation adjusted)Slide27
Source:
OECD (2011), OECD Patent Statistics Database; OECD, Environment Directorate.
27Israeli Patents in selected environment & climate-related technologies
Total number of patents
Water-related patents
Number of patentsSlide28
Prices matter – and spur innovation
NOx Tax in Sweden
Source: OECDSlide29
You can’t manage what you don’t measureSlide30
Towards green growth - Monitoring progress Headline indicators
Environmental and resource productivity
1. CO
2
productivity3. Multifactor productivity including
environmental services
2. Non-energy
material productivity
Carbon productivity
Resource productivity
Multifactor productivity
6. Air
pollution (population exposure to PM 2.5)
Environmental quality of life
Environmental health and risks
Economic opportunities and policy responses
Placeholder – no indicator specified
Technology and innovation, environmental goods and services, prices and transfers, etc.
The natural asset base
4. Natural resource index
5. Changes
in land use and cover
Renewable and non-renewable stocks
Biodiversity and ecosystems
“Green” difficult to isolate
Diversity of country circumstances, of instruments
c
ountries to chooseSlide31
The OECD well-being framework
People
rather than economic system
Outcomes
rather than inputs and outputsBoth averages and inequalities Both
objective and subjective
aspects
Attributes of both
individuals and communities
Both
‘here & now’
and
‘elsewhere & later’Slide32
Agreement with attitudinal statements including on the role of technological progress to address environmental issues
Source: OECD (2012) Greening Household Behaviour