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Janez Potočnik

European Commissioner for Environment

"Sustainability in the changing world – the emergence of the green economy"

Figures and graphics available in PDF and WORD PROCESSED

Smith School World Forum on Enterprise & the Environment

Oxford, 27 June 2010

President Gorbachev,

Dear David,

Distinguished guests,

Ladies and Gentlemen,

Action 2020…. Vision 2050… Europe 2020… - are we guilty of having too many visions today?

If eye-catching titles were a sign of success, I don't think the world would be in the state it is today.

However, we do need action AND vision. And I hope I can show you today how we are building both.

Back in 1988 during a famous speech to the United Nations, President Gorbachev outlined the changes to the then Soviet Union which reverberated around the world….but he also spoke about putting an end to the "aggression against nature".

It seems to me that this is as relevant today as it was nearly 22 years ago.

However today we don't have a Berlin Wall or an Iron Curtain to dismantle – if only it were that easy! We've got to tear down our expectations about what we expect our planet to do for us.

In the 20th Century we enjoyed phenomenal resource-intensive growth. In what has been called the “great acceleration” we experienced a 4-fold growth in population accompanied by a 40-fold growth in economic output. But in the same period we also increased our use of fossil fuels 16 times, our fishing catches 35 times, our water use 9 times, and our carbon emissions 17 times.

And while aggression against nature continues, it is happening in a world that is very different.

It is ever more connected – as the impact of Greece's financial troubles on world markets has shown us. It is ever more interdependent (Europe's external energy imports are likely to be around 70% in 2030, by current estimates). It is ever more multi-polar. It is a complex mixture of quick and deep change, where the economic, the demographic and the scientific are merging into global panoply of challenges. Climate change, future energy supply, pandemics, food and water scares, biodiversity loss…world security. You name it, we are challenged by it.

We know about the fragility of our world, we know how competitive it has become but we are looking for something that can anchor our hopes …something that will give us that continuity and security we yearn for.

Individual and collective responsibility is increasing. Europe has to be part of the answer. Despite some recent and very serious challenges, Europe is still a force to be reckoned with across the world. It is a democratic, social market economy that is increasingly valuing the environment. It is multi-state governance, ruled by law.

But it also needs to be able to speak with one voice and to be able to adapt to the changed reality in which we live. Global developments drive a need for us to work ogether more and push a model of consensual, forward looking policy development. In Europe we do believe in values like freedom of choice and initiative, but we have learned that by giving up some of our national sovereignty and managing some of our challenges together we actually gain a lot. Each one of us and all together. The same approach would be needed globally. The challenges we face are simply calling for joint action.

The days of 'I'm alright Jack' are over.

This is the raison d'être of the Barroso Commission recently endorsed also by the Member States. It is based on the premise of driving a transformational agenda for a sustainable Europe, through the building of a knowledge-based, green and resource efficient economy.

Of course the idea of Green Economy is not exclusively one from Europe. But it is gradually becoming embraced across the globe as the preferred system of production, distribution and consumption of goods and services that improve the quality of our lives over the long term, while protecting us from significant environmental risk in the future.

Making a green economy means increased investments in green sectors, through better policies. It means investing in business infrastructure and in more sustainable consumption and production. But it also means supporting products and services which are more environmentally-friendly. To quote the UNEP, these "should be regarded as forces that generate new economic opportunities". It is about "expanding and reshaping, not reducing, the space for economic development"

This shores up the green sectors. And these investments, both public and private, will help change businesses, infrastructure and institutions, and the adoption of sustainable consumption and production processes. This adds to green growth as part of GDP, helps build green jobs, cuts waste and pollution and can help reduce GHGs.

The greening of our economies is something that few would argue against.

And we are applying these ideas through a spirit of integration that is built in to policies, rather than bolted on afterwards. It will mean fewer future trade-offs and in a Union of 27 countries, could also result in a collective sharing of goodwill, with the long-term benefits that can bring. This is a major step forward from 2000 – it is a balanced view emphasising the need to push for competitiveness and the integration of the economic, environmental and social side.

And perhaps for the first time, in EU2020, we have presented a concrete way of including environmental concerns and the building of a green economy as an integral part of these policies.

Think of our attitude to the environment as a campaign of stealth marketing.

When we take issues like the elimination of harmful subsidies, transport policies, agriculture, or increasing innovative technologies, we know that the responsibility lies elsewhere in the Commission, but we know that there is a tacit understanding that we have to be involved, that the issues raised are important for the environment.

And EU 2020 gives us a chance to do this in a way that we may never have been able to before. We can talk about economic governance – and believe me, there will be plenty more discussions about economic governance! – But now the environment is an established part of our economic policy. The integrated guidelines for EU2020 will be the yardstick against which member states will be judged when they submit their stability and national reform programmes.

This means that their plans for resource efficiency, low carbon economy and eco- innovation will be scrutinised within a broader range of green economy objectives. And if we are certain of our priorities and our metrics for measuring progress in these areas, then it is our responsibility – with the support of the European Parliament – to make sure that they are rolled out in a way that suits Europe, while margin sure it suits our fast-moving, interconnected, super competitive world.

I mentioned resource efficiency specifically. This wasn't an accident. It is, as some of you will already know, one of the major priorities for me during my mandate. It is not a new issue, but it speaks volumes of common sense when you step back and see what the world needs. And it is, of course, totally consistent with need to build a green global economy.

Because what the world doesn't need is a blinkered pattern of consumption; production and usage that strips our planet without working out something fundamental from the word go: we don't have enough to go round!

Resource efficiency for me is the philosophy against the next great extinction. We are trying to throw away, the throwaway generation.

People speak of common sense…it is a bit of a cliché, but that is what it all about. We have to use less, keep more and at the same time, do it with an eye on the environment. We need a common sense revolution.

Resources are under scrutiny, because we are going to have to broaden our outlook when we talk about them. Because there are resources everywhere, and we are really only now figuring out just how valuable they are. Resources like water or food, or air, or soil, or ecosystems. Things we didn't even maybe think of resources before, or never considered particularly valuable. Our biodiversity is a rainbow of resources that some have estimated equals or even exceeds the world's annual GDP. We ignore them…and squander them at our peril.

So we are looking to see what resources we have. And for those that we have used for many years, we are now going to have to re-examine what we do with them. Professor David King has recently and correctly focused on transport as the key sector when it comes to our demand outstripping supply – in the case of oil. I agree with him: we simply have to find better ways to run our transport systems. One of the ways we can do this by addressing the demand for the transport or freight by reducing the resources we use…by using lighter packaging or fewer aggregate minerals, and by doing this, reducing the weight transported. Transport policies which address demand (for example by pricing) aligned to those which reduce resource use can reduce congestion, make systems more efficient and reduce emissions. Creating more efficient public transport systems that people want to use, is another option.

I'm sure you will have seen the latest advert for a hybrid car, or for a new battery technology. There are plenty of them about – but they are still a bit of a red herring. Because if we really want to make the switch to renewable sources, we have to decarbonise the energy system. This, it goes without saying, will need some quite spectacular increases in energy savings across the economy…as well as reduction in the demand for energy. This will need us to look at reducing the amount of embedded carbon in consumption patterns, so reducing our consumption of materials that use energy in their production of disposal.

Decarbonising transport will be part of the review of the recent White Paper on a common transport policy before the end of this year, which will follow on from the President's political guidelines. We are aware of the enormous challenge we have in front of us to meet our EU GHG reduction targets; and how technological measures, like bio fuels will only be successful if they are married to reducing demand.

These are just some examples; I could also talk about other resources, like how important it will be for us to gain fair access to raw materials and use them sustainably, or how we must improve the urban environment, through reducing reliance on motorised transport, which will of course benefit us in terms of air quality, noise and greenhouse gas emissions, improved investment and better health.

I could give a lot of examples, but without resource efficiency, we will fail. Resource efficiency is something we need in our DNA. And we need to pass it down through the generations. It is a way we can break the link between growth and the use of resources – the idea of decoupling - it is a way of changing production and consumption…and crucially, it is a way of pooling existing policies and using THEM more efficiently too.

Delivering on it will mean some careful handling. I have already spoken about the fact that we will need to know which resources are most important to us. But we also need industry, consumers and other stakeholders to buy into becoming the solution rather than the problem. We need to use relative pricing and smart regulation. We need to create new kinds of eco-innovation that moves away from simply allowing a narrow range of eco-innovators to get their products to market faster (although this is still important). We have to turn the whole idea of what eco-innovation is upside down. Waste is a good example where we must think beyond just finding ways of getting rid of it. We need to find new business models, new innovations that exploit the resource of waste to a degree never thought possible before.

Of course we also need to integrate these issues across other policies – this is what I spoke about before and this is what I have spent a considerable amount of time in my role as environment commissioner, doing. The CAP, CFP, regional policy, industrial and innovation policies are not immune to being 'greened' by the application of resource efficiency. And I have to tell you that my fellow Commissioners understand just how important it is. Which, will, I hope be an important factor when we discuss the next reforms of these policies and also next financial perspectives.

One of the questions posed by this forum is whether sustainability and the rapid transition to low carbon transportation is realistic.

This question makes me think about the inherent paradox of our work. It’s a paradox which says on the one hand, that the green, low-carbon economy is the way forward and the choice we should be working for….but which also understands that environmentally smart choices may well be at the back of the queue when it comes to priorities.

Clearly we have to cut our cloth to suit our means here. And getting to the point where we can truly say that we have greened transport policies will mean something very different if we are talking about agriculture, or innovation policies. This is something we need to build into our work to measure resource efficiency and which reinforces the idea that to really deliver on resource efficiency, we need the right policy mix and the right structural incentives in place for everyone.

Having resource efficiency as a flagship initiative in EU2020 is a great help. And there is a great deal of momentum behind the idea right now.

I believe that it is the logical framework for action that should help us to integrate our objectives, not just environmental ones, into a bigger picture of multi-level governance, global competition, environmental degradation and resource scarcity.

This is the bigger picture that will be the centre of attention in 2012 at Rio +20 – I hope we can go there with something to contribute…

Ladies and Gentlemen

I have spoken today about the foolishness of continuing our aggression against nature.

I would like to end my speech with a call for a different kind of aggression: an aggression against complacency, unsustainability, waste and policy protectionism, which will only serve to get us absolutely nowhere.

One can be a fisherman or a farmer, a professor or a politician, manufacturer or retailer, producer or consumer … or a passionate environmentalist. Our interests are in essence the same. At least in the long run.

We need to make this global shift, for our economies, for our lives, for our future and for our planet.

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