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SPEECH/11/570

Janez Potočnik

European Commissioner for Environment

We need to transform our economies

At the opening ceremony of the ICLEI European Convention - Cities in Europe 2020

Brussels, 12 September 2011

Ladies and Gentlemen,

The two presentations you have just heard lead us to one conclusion: "business as usual" is no real option. We cannot continue to be obsessed with the growth imperative we have had until now. We need to look beyond Gross Domestic Product as the yardstick for measuring a country's development.

The Royal Kingdom of Bhutan is famous for having proclaimed Gross National Happiness as the guiding principle for its development. It makes us rightly think about what is important.

I think we would all concur that the ultimate aim of government is to promote the happiness of its people and that there is more to life and to a country than Gross National Product.

Since the industrial revolution many approaches to development in the West have been concentrating on the means of increasing material prosperity with the belief that this would bring happiness.

As a result, exploitation and wealth creation have become central pillars of our society. But THIS, unfortunately, at the expense of a greater wealth: that of those resources that underpin our growth and our quality of life.

In the 20th Century we increased our fossil fuel use by 16 times, our fishing catches by 35 times, and our water use by 9 times, whereas the population only increased by 4 times.

With a world population of 1.5 billion 100 years ago, this growth path was still fine. It gave us health, wellbeing and wealth. BUT with a population of 7 or 9 billion it is not fine. Around 200 000 more people every day are sharing a planet which will remain the same size. Unless we DO change the way we operate, we know that these trends will continue. They will be driven by further population growth and the aim to improve our living standards.

At this point in time, we still have a choice: do we open our eyes and anticipate these global conditions? Or do we choose the ostrich policy and we'll see what they bring?

The ongoing crisis has confirmed that we need to make structural changes in our economies. We have lived for too long on excessive debts and deficits. But we have also lived for too long on excessive use of resources.

We should not fight our way out of the one crisis by running into another crisis. We need to look at how our economies work and make sure that they are fit for their true purpose, namely equitable growth and enabling people to live sustainably within the planetary boundaries.

Part of this structural change IS managing the transition to a resource-efficient economy.

The quality and availability of natural resources will be one of the keys to determining growth prospects in the future. Europe needs to react to the massive increase in resource use that we are seeing.

***

Last year, Europe's leaders took steps to do this by agreeing on the Europe 2020 economic Strategy. That Strategy is the EU's growth strategy for the coming decade. It aims to deliver smart, sustainable and inclusive growth.

These three mutually reinforcing priorities should help Europe deliver high levels of employment, productivity, social cohesion and at the same time meet environmental goals.

Sustainable development is part and parcel of the EU's economic agenda.

BUT, the Strategy is not just about setting aspirations. It is underpinned by tangible actions that will be taken at European Union and national level. One of the flagship initiatives is precisely "Resource-efficient Europe".

Resource efficiency is about producing more value from less material input. In doing so, we will also help reduce our big environmental footprint, which is the essence of green growth.We want to de-couple economic growth from the use of resources and its environmental impacts. This will NOT ONLY give Europe a competitive advantage, but ALSO reduce its dependency on foreign sources for raw materials and other natural resources. If we do it right, it will help us deliver on many goals, from shifting to a low carbon economy and building a greener transport system to promoting innovation and protecting nature.

***

To meet such challenges and objectives, resource efficiency will require major changes in the way we organise our economies, at EU level and at national and local level. It will require a fundamental change of the foundations of the system in which we operate.

And … only so much can be done at EU level. Strong local activity is essential. There is a lot of opportunity for innovative, bottom-up actions at local level.

The majority of Europeans live in cities – places where certain environmental problems are concentrated and where EU environment policy is put into practice. We will not succeed without involving local and regional authorities in reshaping policies.

To address the global challenges we face today, we also need to act locally and local authorities should play a key role. The provision of environmental services such as clean water supply, waste and waste-water treatment facilities, management of natural resources and biodiversity have a high priority in this context.

For example, what we call waste is often a resource. In some Member States 80% of waste is recycled. Other Member States have yet to harness the great potential for realising value from waste. IF local authorities change their perception of waste, and collect and process it as a resource, THEN the environment, the local economy and national finances can all benefit.

"Urban mining" is a way to reclaim compounds and elements from products and waste. There are sources in our cities richer in precious minerals than any goldmine. For example, there is 1g of gold in 25,000 kg of ore, and the same amount of gold in 5 kg of mobile phones.

Another area for action is to change patterns of behaviour, particularly on energy efficiency and mobility. We know that people are significantly influenced by other people. It is evident that transport is one of the main sources of CO2 pollution and noise. Here, for example, we need to find ways to encourage people to use public transport and bicycles more intensively. BUT beyond private behavioural change, local authorities also need to play an important role in addressing this issue - by renewing fleets of public transport and laying bicycle paths … if we continue to use the same examples.

You might ask how the European Union can help. To advance on the "Resource Efficient Europe" flagship initiative that I mentioned earlier, the European Commission will present a Roadmap to Resource Efficiency in the next few days.

The roadmap sets out the steps that all of us, notably policy-makers and businesses, can and need to take.

My key message for you is that improving the way in which we use resources can both save you money and deliver a better environment.

Research shows that a 10-20% reduction in resource and energy use is possible. Achieving this would deliver economic growth and jobs, at a time when they are very much needed.

This is not wishful thinking, this is realistic policy-making. There are many cases at local level where people have tested methods for improving resource efficiency and found that they pay off. For example, the City of Vienna's cross-departmental procurement programme "ÖkoKauf Wien" has improved green procurement. The estimated savings for the City are about €17 million and 30,000 tonnes of CO2 emissions each year.

To encourage and recognise the efforts made by cities to improve the environment, we established the European Green Capital Award in 2008. It rewards local efforts to improve the environment, the economy and the quality of life in cities.

Hamburg is the current holder of the Award, and taking over from Hamburg as European Green Capital for 2012 will be Vitoria-Gasteiz from Spain. Nantes will have the honour in 2013. And we are currently running the call for applications to select the city which will hold the European Green Capital title in 2014. Why not think about applying for your city!

Another area where the European Union can contribute is in proper measurement of progress. In addition to action, we need the tools to measure whether our actions are delivering the progress we strive for.

We want to move from concentrating on Gross Domestic Products statistics to a broader definition of economic growth and prosperity. Some alternative indicators already exist; more are being developed under the Commission's Beyond GDP initiative. Many Member States are looking into this too and work is advancing.

The European Union's role is about setting the strategy. The Europe 2020 Strategy represents a new way for the EU to work with Member States. Environment and resource efficiency are from now on an integral part of Europe's socio-economic agenda.

It touches on many different aspects, such as:

  • Prioritising research, innovation, education and sustainable energy;

  • eliminating environmentally harmful subsidies and tax exemptions;

  • exploiting Europe's "first mover" competitive advantage in environmental goods and services; and

  • shifting taxation from labour to environment.

The European Union puts in place a policy framework that supports the transition to a resource-efficient and low-carbon economy. BUT all actors need to engage in this transition. Cities and local authorities have a major part to play in making this transition happen!

The required transformation calls for changes in our behaviour, in our way of operating and thinking.

I have already seen many good examples of people, companies and cities doing this, and being happy about the results. That's why I contend it is not just a wish, but a strategy anchored in economic and environmental reality.

I would be happy to see resource efficiency become Europe's way to ultimately contribute to our happiness. Happiness which would be based on sustaining our prosperity within the limits of our planet. Happiness about realising sustainable development.

Thank you for your attention.


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