The power of policy and technology: Speech by UNEP Executive Director Achim Steiner at the Global Environmental Action International Conference 2015
Reaching agreement on the 17 sustainable development goals and climate change is just the beginning. They still have to be delivered and, until they are, we still have to adapt to the consequences.
Your Highness, Prime Minister, Excellencies, dear friends and colleagues, I am extremely honored to have been able to hear the remarks of His Imperial Highness and the Prime Minister at such a crucial juncture for both the global environment and the global economy. I would like to thank Juro Saito, the Chairman of Global Environmental Action, for making this possible at such a perfect moment in time.
Ahead of the historic Rio Earth Summit, almost 25 years ago (1991), the first “Eminent Persons’ Meeting on Financing Global Environment and Development” offered invaluable insight into how the world could fund environmental preservation and sustainable development.
Since then, this expertise flourished to become the GEA, which is so well known and respected today. At the same time, the world’s appreciation of the links between environment, economics and technology has also flourished, to create the historic 2030 Agenda laid down last month.
That is why, with the crucial climate change conference still ahead of us in Paris, I am delighted to be here. Having access to the experience of the GEA is as valuable to me today, as it was to Maurice Strong all those years ago. Because reaching agreement on the 17 goals and climate change is just the beginning. They still have to be delivered and, until they are, we still have to adapt to the consequences.
All of which will require a considerable redirection of existing finance and an injection of new investment, especially in core sectors with impact across multiple goals like clean energy, transport and disaster management, which I want to address today.
Let me start with clean energy. This is possibly the best example of a sector that really is integrated into the very fabric of the goals, offering some great opportunities to combine socio-economic growth with environmental protection.
We know now that most of the coal, oil, and gas thought of as reserves cannot be burned if we are to avoid potentially catastrophic climate warming
However, in recent years, progress in renewables has outstripped predictions.
In 2000, the International Energy Agency predicted that non-hydro renewable energy would comprise 3% of global energy by 2020. By 2008 that benchmark had been reached. By 2014 it had been tripled (9.1%). The net result of such progress is that Investment is going up, costs are coming down and ambitious, large-scale projects are being implemented around the world.
Here in Japan the Tokyo Metropolitan Government has committed to sourcing around a fifth of the city’s energy from renewables by 2024. The target of quadrupling photovoltaic energy is particularly impressive. And in South Africa the government invested $10 million in 2011, aiming to create the most comprehensive, private sector focused renewable energy policy in Africa. Within two years that had triggered $14 billion of mainly private investment and 4GW of new wind and solar power generation.
However, there is no point investing in more renewables if we continue to waste energy elsewhere. The International Energy Agency estimates that by the end of this decade, 70% of our potential CO2 reduction could actually come from energy efficiency measures.
Take a look at our cities – after all, nearly half the world’s population lives in urban areas. Today, our cities create 80% of GDP, but they also occupy 3% of the total land surface, produce 50% of global waste and consume 75% of natural resources. In fact, half of the energy consumed is used for heating and cooling. So, simply ensuring more efficient use of appliances can offer huge benefits for consumers, power companies and the environment.
Take something as simple as air conditioning. Ghana’s Electrical Appliance Labelling and Standards Programme was the first of its kind for sub-Saharan Africa. Their initiatives for air conditioning could save the country around $64 million per year and 2.8 million tonnes of CO2 over 30 years. While, in Southern Africa, similar air conditioning programmes could cut electricity use by 13% and bills by $3 billion per year, with reductions in greenhouse gas and carbon dioxide emissions equivalent to taking 8 million vehicles off the road every year.
Similar programmes are delivering equally strong efficiency improvements around the world. Notably, the Ecodesign Directive in Europe has cut electricity consumption by 16%, by systematically integrating environmental aspects at the earliest stage of product design. And, the Top Runner Programme here in Japan has already produced energy savings of 11% through 23 product categories identified for their high energy consumption, widespread use or substantial efficiency potential.
So, if we can produce more clean renewable energy and we can use it to power more efficient appliances, then we need to be just as careful with the infrastructure that connects the two.
If I stay with the theme of urbanization, modern district energy systems are a low-cost, low-carbon and climate resilient. By coordinating the local production and supply, they can cut the energy required to provide heat, cooling, domestic hot water and power to buildings by 80-90%, reduce greenhouse gas emissions by up to 40% and save over 35 giga-tonnes of CO2 by 2050.
Of course, projects like the Yokohama Smart City initiative take this thinking a step further. Using a public-private partnership approach that spans a variety of projects – from the introduction and management of renewable energy to next generation transportation systems – well reflects the holistic nature of the sustainable development goals.
That is an approach we can build on – literally – if we are to intertwine our daily activities with sustainable lifestyles. By incorporating sustainability in every stage of design and construction for future urban spaces; by raising awareness among consumers and building operators of how easily they can reduce waste and increase efficiency, wherever they are; and by understand the basic resource flows of urban spaces in terms of water, waste, food and, of course, mobility.
Which brings me to my second example: transport. This might be less obvious than energy as an example of a cross cutting sector. Nonetheless, not only is it just as integral to the success of goals for things like health, wellbeing, economic growth and partnerships, but it is also an opportunity to combine immediate action in the national interest with long term impact on global challenges like air quality and climate change.
There will be nearly three times as many cars on the road by 2050 as there were in 2010, with most of that growth occurring in developing countries where better transport is necessary for economic development.
However, this is an opportunity for developed countries to share the lessons learned from the high carbon, high impact choices that currently bottleneck so many transport networks, permitting the developing countries to leapfrog to something better and more sustainable.
Research from the Global Fuel Economy, of which UNEP is a partner, has shown that just by adopting existing fuel efficient technologies could save $2 trillion in un-used fuel in just the next decade and keep fuel demand steady by 2050, saving 8 billion barrels of oil a day and halving CO2 emissions from cars and light duty vehicles.
In fact, most OECD countries have already made significant progress. Since 2005, developed countries have cut average fuel burn from more than 8 liters per 100 km to less than 7. The EU has cut average CO2 emissions from 140 grams/km per vehicle to 120, and is on track to reach 90, while the US’s light-duty fuel economy standards are delivering savings of almost $12 billion per year, against costs of just over $3 billion.
In addition, we’ve seen a global move to eliminate lead from motor fuels, which saves $2.45 trillion per year. UNEP already works with the public-private Partnership for Clean Fuels and Vehicles to promote the reduction of air pollution from transport in developing and transitional countries. Since 2002, their work has catalyzed the phase out of leaded fuel in over 100 countries.
What we need to do now is spread that kind of best practice even further, which is why UNEP also supports nearly 60 countries in developing and implementing fuel economy policies. However, while democratizing established technologies can certainly offer significant improvements, we really need to switch up a gear to more disruptive technologies if we are going to seriously reduce overall emissions.
In particular, that means exploring the opportunities and challenges for scaling up new technologies such as hybrid and electric vehicles. Two and three wheel vehicles have been a growing part of city traffic around the world. But highly polluting two-stroke motorbikes are causing particular problems in some parts of Africa, where imports are on the up and they have become a leading source of urban pollution. In Nigeria, two-strokes are being replaced by four-stroke. In Uganda there has been 150% growth in the last 10 years. And in Kenya, bike imports have overtaken cars in just a couple of years.
However, the switch to electric is complex for cars, but not for bikes. In fact, most of China’s two-stroke bikes have already been replaced by 200 million electric bikes. It is widely accepted that not only is this is economically viable, but it has massive health and climate benefits that reach well beyond the borders of the countries involved. That means we have a choice: either we can let the fleets of 2-stroke bikes grow unchecked in these emerging markets or we can help them leapfrog directly to affordable, emission-free technology with equivalent costs. Both the market and the planet are ready. So, UNEP is tackling this on 2 fronts. Our Electric Mobility programme aims to support cities and countries keen to make the technology leap, while our work with Clean Air Asia aims to help phase out of 2-stroke two and three already operating.
But, there’s a long way to go. According to the IEA, three quarters of all vehicle sales by 2050 would need to be some type of plug-in electric vehicles to keep rising temperatures within the two-degree threshold. And while the switch electric cars will be more complex than for bikes, there are some good efforts under way. Look at the innovative thinking behind Toyota’s smart grid project. Their engineers believe that combining smart grid homes and plug-in cars could cut household energy consumption by 75%.
We have to encourage such efforts to scale up innovative solutions and optimize the connections between different elements of sustainable living. That connection between smart infrastructure and transport is vital. It can be about making transport more efficient, with a growing number of cities implementing preferential lanes for vehicles carrying more than one passenger. It can be about capitalizing on the new trends in mobile apps, by planning for areas to facilitate car sharing and bike sharing. Or on a bigger scale, it can be about a shift towards more integrated land and mobility planning, with growing provision for alternatives like buses, bikes, walking, rail and even inland waterways.
Now, I highlighted energy and transport because of their similarities in the possibilities offered by new technology, the opportunities for quick local wins to deliver lasting global benefits and the potential impact on multiple sustainable development goals.
Unfortunately, they have one other thing in common: serious consequences if they are not addressed – for climate change in particular. Normally I prefer to be optimistic when I talk about the sustainable development goals and climate change, because I believe that we can deliver them and I believe that they offer some amazing opportunities. But in the meantime, there are direct and difficult consequences arising from the current situation.
Regrettably, the people of Japan are more familiar than most with such issues. The images of the flooding and landslides caused by Typhoon Etau last month were shocking. I would like to take this opportunity to offer my condolences to the people of Kanto-Tohoku and my appreciation to the rescue teams that assisted.
The ability to turn such adversity into strength is rare. Yet Japan has a strong track record for doing exactly that. What’s more, by sharing your experience of responding to disasters, you have set many other nations on course for greater resilience, better equipping them to avoid disaster, to respond to it and, crucially, to recover from it. Indeed, your leadership and contribution to the Third World Conference on Disaster Risk Reduction in Sendai will not only protect the lives of millions of people far beyond Japan, but will also deliver much wider benefits.
As the Secretary-General said on the opening day of the Sendai Conference, “sustainability starts in Sendai”, because as well as adopting a crucial framework to reduce the risk of disaster and loss of lives and livelihoods, it opened a new era in sustainable development, laying the foundations for agreement on the sustainable development goals in New York.
One of the key Sendai outcomes is putting more focus on “building better” in the first place to prevent disasters - investing in resilience that is rooted in social, economic, environmental and cultural sustainability. Following the 2011 earthquake, Japan vigorously increased support for resource efficient renewables. It is testimony to the country’s extraordinary ability to turn things around that by 2014 the country was able to replace half its missing nuclear power capacity through energy efficiency, launch the first offshore floating wind turbine in Asia, and start work on what will be the world’s largest floating solar installation.
UNEP’s first Adaptation Report shows that coping with the consequences of climate change will cost between $150-500 billion per year until 2050. If we follow Japan’s example in turning adversity into advantage, that could mean helping the worst hit communities to live, not just to survive.
So Japan’s experience highlights why policy and technology can be a powerful force for change. Which takes me full circle - back to my earlier comments about clean energy and transport - and to the decisive factor on which all of sustainable development goals will stand or fall: finance, or more accurately, the transition to a more inclusive, green economy.
Achieving the shift in financial and investment mechanisms needed to deliver the goals will be as historic as the goals themselves. However, UNEP has been working with more than 200 global financial institutions for over 20 years to prepare the ground for an economy capable of funding the mitigation, impact and adaption to climate change and of underpinning the delivery of all 17 sustainable development goals.
Through the UNEP Finance Initiative and, more recently, the UNEP Inquiry we have been working to improve understanding of the links between environmental, social and financial performance, help individual states build decision frameworks around sustainable development, and maximize the return on public and private investment, at both the national and international level.
I was at a meeting with the Sustainable Stock Exchanges Initiative a few weeks ago and I can assure you that there is much cause for optimism. The financial community can see the opportunities as well as we can. For example, the International Energy Agency has shown that the uptake of more economically viable energy efficiency investments could boost cumulative economic output by $18 trillion in the next 20 years. That’s more than the combined economic output of the US, Canada and Mexico.
Those kinds of returns on investment are hard to ignore. That’s why, last year, global investment in renewable energy was up 17% and investment in developing countries was up by 36%. That’s good progress, but there is there is a long way to go to fill the $1 trillion gap in the annual funding required to keep global warming below 2 degrees.
However, there are some clear actions we can take to address it. First, we can redirect existing finance - by hitting the 2030 goals investment in fossil fuels can be cut by $6 trillion, which can in turn be reinvested in clean renewables. Second, we can ensure that public investment is used to trigger larger scale mobilization of private investment - as with the South African clean energy programme I mentioned earlier. And third, we can encourage the growing shift coming from within the finance sector itself. Such as the 365 leading financial organizations who are signatories to the Global Investor Statement on Climate Change, which is pushing for a controlled move away from fossil fuels towards renewable technologies; the Portfolio Decarbonisation Coalition, a group of pension funds and insurers who together have committed to decarbonize $65 billion of their holdings by shifting from browner to greener stocks within their investment portfolios; or the “green bond” market, which has grown ten-fold in the last four years and will issue over $60 billion in green bonds this year.
In Kenya, where the United Nations Environment Programme is headquartered, there is a proverb that says: “If a dead tree falls, it carries with it a live one.” The same can be said of the 17 sustainable development goals. If any one element fails, then it could take the others with it. Without quality education we cannot tackle climate change. Without gender equality we cannot have sustainable cities. And without decent work and economic growth we cannot have zero hunger or poverty.
Over the years, places like Kyoto, Aichi and Nagoya, have become synonymous with the ambition necessary for environmental progress. So, as climate change demands that we reinvent our economy, our technology and our even our sense of responsibility, what better place than Tokyo to gather our thoughts ahead of COP 21.
Again, I would like to offer my thanks to His Imperial Highness the Crown Prince, Prime Minister Abe and Chairman Saito and his colleagues at the GEA for making this possible.