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ENEP side event: Reviewing the achievements of EU environment policy in the last five years

William Neale, the former cabinet member for Janez Potočnik met with ENEP members during a General Assembly side event visit to the European Commission recently.  In reviewing the last five years Mr Neale underlined the core pillar of the Potočnik mandate being to “Live well within the limits of the planet”

This entails two challenges, the first to move countries developing and emerging to a more sustainable growth path and the second, to get developed members states to adopt more sustainable consumption patterns.  At the beginning of the Potočnik mandate it was clear that there was lots of environmental legislation in place but that it needed better implementation.

The Potočnik team set out to argue for an environment policy not a constraint to growth, but one that was based on resource efficiency and does not consume finite resources.  With energy and materials prices increasing, the European Union as a net importer needs to embrace resource efficiency if it is to remain competitive. Citing a survey from VDI, one of ENEP’s German members, Mr Neale said nearly 43% of costs of the German member companies surveyed relate to materials and only 18% to labour in Germany. It was figures like this that drove Commissioner Potočnik to put resource efficiency as a flagship within EU 2020.

With population growing rapidly in the Far East, combined with the emergence of increasingly middle class consumption patterns, access to affordable resources will become increasingly important.  After the 2008 economic and financial crisis, the Commission observed a notable fall in consumption rates.  The new policy for resource efficiency, which at the beginning was merely a statement of intent, became a campaign to ensure that in coming out of the crisis Europe had adopted new consumption patterns.  In 2011, the resource efficiency road map, set out to decouple resource consumption from growth with the ambition by 2020 to be able to measure progress towards new targets through a series of indicators - http://ec.europa.eu/environment/resource_efficiency/about/roadmap/index_en.htm

Following the road map, the Commission created the resource efficiency platform with representatives from industry, European Parliament, the member states, consumer organisations and NGOs.  The platform has played an important role in guiding the commission approach. - http://ec.europa.eu/environment/resource_efficiency/index_en.htm

All of these developments led to the Potočnik swan song the Circular Economy package http://ec.europa.eu/environment/circular-economy  adopted on the 2nd July this year.  Its objective being to initiate a process that could lead to more added value for each unit of consumption in raw materials. Making decoupling resource consumption from the extraction and production processes and placing the emphasis on reuse.  In preparing the circular economy package, the Commission worked substantially with the Ellen McArthur Foundation http://www.ellenmacarthurfoundation.org/ and McKinsey to work up the package.  The package was underpinned by a number of notable review clauses that have come up in 2014 under existing legislation including the Waste Framework, Packaging Waste and Electronic waste.  To reinforce the circular economy package, targets for recycling and land fill are to be reinforced. Across Europe, average recycling rates are equal to 43% whilst some advanced members states are now even hitting 70%.  At the same time other member states are struggling and are still landfill 80% of their waste. Sustainable buildings are also an important issue with the life cyclyability of building and demolition wastes. Overall, food production, transport and construction are the most resource intensive sectors accounting for 8-% of Europe’s resource use but food waste has the biggest impact on the environment.  Wasting 30% + of food multiplies the land, water, phosphorus in greater proportions that went into their production.

Mr Neale underlined the importance of regulation in this regard.  However, the legislative process was only one aspect.  For example, it is essential to create demand for waste streams and recylates if new players are to invest in the technologies to treat such wastes effectively in future.  Industrial symbiosis, waste to energy, bio products, new business models such as the Dutch company that is now leasing carpet tiles to businesses and then taking them back in the Netherlands are good examples of emerging trends.  Whilst product and commodity streams can vary substantially, the package places significant emphasis on the scope to improve durability, recyclability, updatability within the circular economy.  What is lacking still is the market coordination amongst to actors in the supply chain stream. 

Lack of knowledge on where the materials are in the supply chain is key.  For companies to invest in expensive infrastructures Mr Neale said that it is key that they are able to get at the precious metals and other elements in the waste stream. The circular economy therefore takes a broader approach to policy than just environment. For example, the integrated action plan on green small and medium sized businesses rather than just focusing on bigger industries in the circular economy.  New entrepreneurs can play an important role in new technologies and new opportunities.  Many corporates are leading the way recognising the mega trends and the increasing commodity prices over the next 20 years. 

On the Green employment side, with the transition coming the Commission is keen to make it a job rich transition.  Recycling services are often a proximity jobs close to where the products are consumed. - http://europa.eu/rapid/press-release_IP-14-765_en.htm

Finally, the Resource efficiency targets continue to be the most controversial part of the package apart from the food waste communication.  Over the last 4 years, the Commission worked with modellers, statisticians at the European and national level have been working to identify the best proxy that is realistic, robust and communicable to the wider public.  As a result raw material consumption in weight to GDP (taking into account production and service sector economies in a balanced way) has been identified as the fairest indicator of resource efficiency.  Whilst heavy production sectors like cement and concrete feel unfairly targeted, the emphasis should be on getting more value out of each tonne of raw materials.  Zero landfill, reduced incineration with 70 % recycling and reuse is also an important part of the waste review. 

In response to the question of varying performance levels between the Member States, Mr Neale confirmed that expert teams had been sent to members states where difficulties are being experienced.  Generally speaking recycling rates have gone up by 3% a year by introducing landfill taxes and separate waste streams. The market for reclyclates can get established as long as the administration has the stability to support it.  With regards to the Structural Funds, significant resources are available to countries in transition but they have had to negotiate partnership agreements that have required national strategies to be ready as a framework to guide priorities in the next seven years. In particular, the Commission wants to avoid building big infrastructures that could become redundant in a few years’ time. Where countries lack incineration capacity the EC wants to use facilities in neighbouring regions or countries and ensure wider ranging integrated strategies.

The circular economy package was approved in the final meetings of the old Commission and now awaits approval by Parliament and Council.  Now the new commission will now need to defend it so it is essential that resource efficiency is seen as a contributor to growth and jobs in a global economy where the cost of accessing finite raw materials is increasing. It is understood that the new European Commission is likely to make a decision around Christmas on whether the circular economy package of waste and recycling goals fits with its new “growth and jobs agenda”, Jean-Claude Juncker’s Commission, which took office this month, “could decide to modify or withdraw” the package, to which “they are not bound”, according to the Director General of DG Environment. Whilst the official could not prejudge the outcome of the new Commission’s assessment the fact that the package is already being debated by Parliament and Council would suggest that total withdrawal is less likely. A similar assessment is also underway for the 2013 air quality package.

Meanwhile, UNEP has announced that Former Commission Janez Potočnik is the new co-chair of the International Resource Panel (IRP), http://www.unep.org/resourcepanel  the most authoritative scientific forum for scientists and experts working in the area of natural resource management.  The International Resource Panel (IRP) was launched by the United Nations Environment Programme (UNEP) in 2007 to build and share the knowledge needed to improve the use of resources worldwide.  The Panel consists of eminent scientists, highly skilled in resource management issues. Their reports distil the latest scientific, technical and socio-economic findings around global resource use. They provide advice and connections between policymakers, industry and the community on ways to improve global and local resource management. The Panel includes scientists and governments from both developed and developing regions, civil society, industrial and international organisations. The Panel's goal is to steer us away from over-consumption, waste and ecological harm to a more prosperous and sustainable future. READ MORE - http://ec.europa.eu/environment/circular-economy/index_en.htm

Issue 37