Seite 1 Götz von Stumpfedt 10.03.2013 International Experiences and GIZ’s Contribution to a Shift towards Green Economic Development ProGED Start Up Event.

Seite 1Götz von Stumpfedt 10.03.2013

International Experiences and GIZ’s Contribution to a Shift towards Green Economic Development

ProGED Start Up Event 11 to 13 March 2013

Marco Polo Hotel, Cebu City

Götz von Stumpfeldt, GIZEconomic Policy and Private Sector Development- Green Economy -


Content

I. Green economy: What is it?

II. Concept of ecological footprint

III. The eco-efficiency revolution:Decoupling growth from resource inputs

IV. Success factors for green economy strategies

V.GIZs approach: Greening economic policy advice


Green Economy

“An economy that improves human well-being and social equity while simultaneously reducing environmental risks and ecological scarcities.“ (UNEP)

Green Growth

„ Green Growth describes a growth strategy that shapes economic processes in an ecologically sound way and creates new jobs and income opportunities in new green sectors. It reduces environmental impact to a minimum.“ (BMZ Broschüre Ökologisches Wirtschaften, Green Economy, S. 8)

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Growth – ecological objectives

Götz von Stumpfedt 10.03.2013

GDP – the gross domestic product

• indicates the value of all goods and services produced in a country during one year

• it is important to understand, whether the economy is growing or shrinking

Economic growth can be linked to environmental degradation; New indicators have been developed that give important information additional to the GDP.

The Economics of Ecosystems and Biodiversity (TEEB) study is an international initiative to draw attention to the global economic benefits of biodiversity. It calculates the economic value of natural resources as the rainforest.

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Payments for ecosystem services (PES)


is the practice of offering incentives to farmers or landowners in exchange for managing their land to provide some sort of ecological service.

1997 Nature magazine article estimated the annual value of global ecological benefits at $33 trillion, a number nearly twice the then global gross product.

There are “big three” among these 24 services which are currently receiving most of the money and interest worldwide.

• climate change mitigation,• watershed services and• biodiversity conservation e.g. • UN-REDD Program is the United Nations collaborative initiative on

Reducing Emissions from Deforestation and forest Degradation (REDD) in developing countries.



What does the ecological footprint mean?

• The ecological footprint represents the amount of biologically productive land and sea area necessary to supply the resources that a human population consumes, and to assimilate associated waste in a given technological context

• It estimates how much of the Earth it would take to support humanity if everybody followed a given lifestyle.

• For 2007, humanity's total ecological footprint was estimated at 1.5 planet Earths; that is, humanity uses ecological services 1.5 times as quickly as Earth can renew them.

• It represents an accounting system for bio-capacity that tracks how much bio-capacity there is, and how much bio-capacity people use.

• Every year, this number is recalculated to incorporate the three-year lag due to the time it takes for the UN to collect and publish statistics and relevant research.


Components of the Footprint

Cropland

Fishing Grounds

Carbon Footprint

Grazing Land

Forest

Built Area


Ecological Creditors and Ecological Debtors


Relative and absolute decoupling


Decoupling of energy consumption and GDP growth in Germany

Resource productivity

GDP (gross domesticproduct)

Resource extraction and imports

Source: Federal Agency for Statistics

Resource productivity and growth


Decoupling of energy consumption and GDP Decoupling of energy consumption and GHG-emissions Germany

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 200575

80

85

90

95

100

105

110

115

120

125

130

GDP

Primary energy consumption

GHG-emissions

Efficiency

Substitution


Germany Success factors (1)

1. Political system: Ability• to quickly integrate the new issues

learning• to formulate and implement policies

consensus orientation/ corporatism• integraton of stakeholders


2. Environmental policy is innovation policy

• Regulative policies

• Feed-in-tariffs

• Environmental taxes

Germany success factors (2)

Strong and competitive green industries green business services

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Success Story China (1) 11th Five-year Plan (2006-2010): Allocation of a significant share of investments to green sectors esp. renewable energy and energy efficiency

• Wind Power • Annual growth rate of additional generating capacity from wind power:

more than 100% from 2005 to 2009• New installations in 2009: 13,8GW China led world in added capacity

= 2nd in terms of installed capacity, after the US

• Solar Power • China is largest Solar PV manufacturer • Produced 45% of global solar PV in 2009 • With more than 12 GW of large projects in the pipeline, it would rapidly

become a major market in Asia and the world • China is largest market for solar hot water with nearly 2/3 of global

capacity more than 10% of Chinese households rely on the sun to heat their water with more than 160 million sq. meters as total collector area

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China Success Story (2)

Job Creation • Energy sector output is worth US$17 bn. and employed an

estimated 1,5 million (2009), out of which: 600,000 in solar thermal industry 266,000 in biomass generation 55,000 in solar photovoltaics 22,200 in wind power

In 2009 alone, an estimated 300,000 jobs were created.


Comparing industrialized countries

• Most competitive countries are less polluting • Environmental sound is innovative• Environmental sound policies are innovative

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GIZ‘s approach:Establish green growth as a cross-cutting issue


Change framework conditions to integrate external costsEco-taxes; reduction of subsidies

Make use of cost-effective environmental investmentPromote eco-efficiency, profitable environmental managementPREMA, Pro-Klima, Green industrial parks, eco-Innovation

Create green markets Green procurement, feed-in-tariffs for renewable energies

Green finance

Implement environmental and social standards


Reduce market failure

Reduction of environmentally critical subsidies e.g. fuel subsidies

introduction of ecological taxes

Integrate environmental aspects into poverty reduction strategy papers (PRSP)

introduce feed-in tariffs for renewable energies

Integrate costs of pollution into production costs

Change framework conditions to integrate external costs


Introduction of ecological taxes in Vietnam

Taxing • refined fuels and

coal• energy and certain • chemicals

(HCFCs)• selected pesticides

and • soft plastic bags.

Expected results• reduction of CO2

emissions by 7,5%• revenues 1,5 billion

Euro/ year• reduction of waste.

Change framework conditions to integrate external costs


Cost structure of the manufacturing sector Germany

Abschreibungen 2,8%

Lohnarbeiten 2,4%

Dienstleistung 1,6%Mieten, Pacht 1,4%

Energie 1,8%

Handelsware 11,7%

Kostensteuern 3,4%

Sonstiges 11,4%

Material 44,8 %

Saving potential 20%

Personnel 18,7%

Material costs: 500 bn. Euro

Saving potential: 100 bn. EuroSource: DESTATIS 2009

Make use of cost-effective environmental investment


During the last decades, in Germany material and resources productivity has risen, but much slower than the productivity of labour.

350

300

250

200

150

100

50

0

1960 1970 1980 1990

Productivity of labour

Productivity of material

Productivity of energy

Dev

elo

pm

ent

sin

ce 1

960

=1

00(W

est

Ger

man

y o

nly

)



Material- and Energy Flow Diagram



Value Stream and Cost Diagram



PREMA Saving Potentials

Energy Water Steel


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Flow analysis

Analysis of costs /environmental impact

Analysis of causes

Developmentof measures

Implementationof measures

Integration incompany structure

12

34

5

6

Where is the problem

How big is the problem

Why do you have the problem

What can we do about it

Who does whatby when

How to go on Cycle of change

GIZ Prema approach

Cost Saving

potentials?


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economic efficiency

organisationallearning

environmentalperformance

Capability to implement changes

Less waste, air emissions and

effluents

Cost savings andIncrease inproductivity


GIZ Prema approach

PREMA = triple win

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continuous applicatio

n in th

e company

Elements of the PREMA Programme

Infotraining to PREMA

2 hours – 1-day workshop

Cost ManagementModule

3 workshops of 2-3 days each

Good HousekeepingModule

3-day workshop

networkmeeting

networkmeeting

networkmeeting



Example: CHINA – application of methodology„Profitable Environmental Management“ (PREMA)

Approach

PREMA Training of 3 Trainers, 42 Consultants, 128 representatives of companies

Implementation of 11 training programs in 5 cities Implementation of 840 PREMA measures in more than 60 companies

Results 64 companies, implementation of more than 800 individual measures Investment of approx. 6,5 million € in plants that led to annual net

saving of approx. 13,5 million € (average payback period: 5,2 months)

Altogether, up to 30% of energy, 20% of water and 10% of materials have been saved




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Proklima

Integrated ozone and climate protection with focus on natural refrigerants with low-GWP and energy-efficient applications.

– 16 years worldwide initiatives– ~ 235 projects– ~ 40 Partner countries

– ~ 100 Mio tons CO2 eq. reduced


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Global relevance of cooling

• More than 50% of energy consumption in hotels & resorts for cooling and air conditioning

• Ca. 15% of global energy consumption for cooling (7% growth/year until 2050) [IEA]

• Approx. 40% of energy consumption in urban areas for refrigeration and air conditioning

• Up to 40% of goods perish along the (missing) cool chain

• Refrigerator and air conditioning unit are (next to light and tv) the top investments for poor families

• Up to 80% of energy costs of poor households come from the household refrigerator


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Case study Ramada Benoa Hotel, Bali (Indonesia)Installation of new air conditioning system

• 180 Guest rooms, spa, restaurant, etc

• Energy consumption: 3.2 Mio kWh/yr (old system)

• Savings: ca. US$ 15,000/month, 1.8 Mio kWh/yr,

• Return on Investment: 12 Months

• Save 1,500 tonnes CO2eq/yr, between 40–60% lower CO2eq emissions



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Approach

• Capacity building for local AC manufacturer

• Independent energy and emission audit

• Redesign of AC products

• Pilot installation in hotel

• Training of local technicians (installation, operation, maintenance)

• Promotion of results and experience, replication

• Best practice in national strategy for sector transformation



Sustainable management of industrial zones in Tunisia:

• 121 industrial zones in which 50% of all companies produce.

• GMG is a group of companies which together provide infrastructures

such as waste water.

GIZ

consults how to increase resource efficiency and how to reduce

emissions.

acts as a moderator/intermediary btw. governments and industries.

Sustainable Management of Industrial Zones


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Summer academy sustainable entrepreneurs 2011 et 2012, GIZ Algeria

Business plan competition

54 winners selected

Summer school: training, mentoring, business plan development

Create awareness

Support high potential start-ups

Stimulate innovation


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• Development of a platform to facilitate and promote innovation, collaboration and entrepreneurship for the green economy

• Services: facility (fab lab, creativity corner), training (green skills, innovation management, marketing), consulting (project feasibility, energy efficiency)

• Partners: Ministry of Trade and Industry, Ministry of Education, University of Cairo, Youth NGO

Ice Hub - Egyptian-German Program Private Sector Promotion and Employment Promotion:


http://www.icehubs.com/


Create green markets

Green procurement and green labels

Green procurement and eco-labelling project in Bangkok

• The Green Public Procurement in Thailand is strengthened.

• The new Green Public Procurement strategies in Thailand are disseminated to other selected countries in Southeast Asia.

2)

Create green markets

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Policy Consulting: Intersections of financial, environmental and energy policy

Integration of ecological aspects within regulatory frameworks of banks and other financial service providers

Innovative concepts of financing for:

• SSMEs

• renewable energies

• investments in energy efficiency

Financial system development

Green Finance


Green Finance


India: SSME Promotion in India

Green finance for improvements in energy-efficiency.

The development of loan products for the purchase of clean and energy-efficient technologies.

Energy-efficient loan is tested in a light metal cluster involving ca. 10.000 SSMEs.

GIZ:

• consults banks like the State Bank of India in their development of loan products for clean and energy-efficient technologies

• acts as intermediary btw. banks and industry

Green Finance


India: Sustainability in the Banking sector

• Support to the State Bank of India and other banks.

• Integration of environmental issues and other dimensions of sustainability in their management strategies.

• Integration of environmental and social aspects into lending decisions and to evaluate risks relative to these issues.

• Development of trainings to integrate adaptation to climate change into management strategies.

• Banks as multipliers for sustainability issues.

• Reducing Carbon footprint of companies in textile industries.

Green Finance


Systemic and systematic integration of ecological aspects and criteria in the promotion of value chains, which means at all levels of the value chain:

• Interactions btw. value chains and climate change as well as

• Resource efficiency

• Identification of new, ecologically sustainable business opportunities & models

Indonesia (Local und Regional Development, LRED) Value chains in tourism

Promotion of Value Chains

Green Value Chains – Basic Approaches

Green Finance


Bangladesh: Social and environmental standards in industry esp. textile industryPressure to respect social and environmental standards

• Development partnerships with international retail enterprises and local partners; Bangladesh Garment Manufacturers & Exporters Association;

• Advise the development of new environmental guidelines on the national level.

• Training of entrepreneurs, managers and workers in energy- and resource- efficiency and the treatment of chemicals and wastewater

200 enterprises were able to step up one staircase in ILOs classification

Respect of social and environmental standards is raising productivity; the project aims at documenting these “business cases” and wants to cooperate with local consultants to make sure that positive experiences are being scaled up to a national level.

Implement environmental and social standards


Thank you very much for your attention!

[email protected]

mailto:[email protected]

Seite 1 Götz von Stumpfedt 10.03.2013 International Experiences and GIZ’s Contribution to a Shift towards Green Economic Development ProGED Start Up Event.

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