cynnalcymru | sustainwales

1. www.cynnalcymru.com | www.sustainwales.com Follow us on Twitter | Dilynwch ni ar Twitter @CynnalCymru 02920 19 20 21

2. Co-Create the Green EconomyWhat’s Happening in Wales 20/11/13 with Dr Jeanette Reis Jeanette@cynnalcymru.com Senior Policy and Research Officer, Cynnal Cymru – Sustain Wales

3. Overview- What’s Occurring In Wales? • 1. The business case for green economy • 2. What do we mean by green economy • 3. Setting the context- The international and welsh situation • 4. Examples of Welsh green growth • 5. Common issues…. • 6. Final thoughts…. A favourite catchphrase of Nessa from Gavin and Stacey

4. The Business Case for Green Economy 41,500 jobs in Wales supported by green business drive significant business investment create sustainable economic, social and environmental benefits. Ref: CBI (2012) The Colour of Growth- Maximising the Potential of Green Business. Confederation of British Industry. More importantly, if humanity is to survive, science tells us that a major transformation of our economies, policies, technologies and modes of production and consumption is required. Ref: WWF (2012) Building Green Economies- Creating Prosperity for People and Planet. Downloaded from http://assets.wwf.org.uk/downloads/building_green_economies_oct_2012_lo.pdf on 9th April 2013.

5. Definition of Economy (Wikipedia- sorry!) An economy consists of the production, distribution and consumption of limited goods and services by agents in a given geographical location. The economic agents can be individuals, businesses, organizations, or governments. Aberystwyth from above A given economy is the result of a set of processes that involve culture, values, education, technological evolution, history, social organization, political structure and legal systems, as well as its geography, natural resource endowment, and ecology, as main factors.

6. What Do We Mean by Green Economy? UNEP 2010- “(Is) one that results in improved human well‐being and social equity, while significantly reducing environmental risks and ecological scarcities. It is low carbon, resource efficient and socially inclusive”. Rio 2012- “It should contribute to eradicating poverty as well as sustained economic growth, enhancing social inclusion, improving human welfare and creating opportunities for employment and decent work for all, while maintaining the healthy functioning of the Earth’s ecosystems...” Price Waterhouse Cooper 2012- “A green economy is an economy that is low-carbon, climate-resilient, biodiverse, resource-efficient and socially inclusive”.

7. What’s the Difference Between Green Economy and Green Growth? “Green growth is the means by which the current economy can make the transition to a sustainable economy. It involves promoting growth and development while reducing pollution and greenhouse gas emissions, minimising waste and inefficient use of natural resources, maintaining biodiversity, and strengthening energy security”. Source: OECD 2009 OECD 2011- Green growth means fostering economic growth and development, while ensuring that natural assets continue to provide the resources and environmental services on which our well-being relies.

8. However, There is also “Sustainable Economic Development”… • One Wales One Planet Vision of Sustainable Economic Development (2009): • A resilient and sustainable economy for Wales that is able to develop whilst stabilising, then reducing, its use of natural resources and reducing its contribution to climate change. • Key outcomes: • A sustainable economy for Wales that is resilient to changes in the global economy • Our long term economic future secured by achieving the transition to a low carbon, low waste economy • Wales is the best place for business to locate, start up, grow and prosper • Regeneration involves and engages with local communities and is firmly based on sustainability principles, creating an infrastructure for the future that favours sustainable ways of living and working. Green Economy is not entirely new. It is a more specific, infrastructure based way to talk about the economic dimension of sustainable development….

9. Green growth is a means to achieve a green economy. A green economy is a component part of sustainable economic development, which in turn is a component part of sustainable development. It All Becomes Clearer (Hopefully) Sustainable development Sustainable economic development Green economy Green growth

10. International Context for Green Economy Global low carbon and environmental goods and services sales for 2010/11 in £m • Significant global presence • Estimated 5% of the global economy • Growing rapidly relative to the rest of the economy. Low carbon goods are generating sales of £1.6bn globally. BIS: Low carbon environmental goods and services However… the valuation of ecosystem goods and services is still being debated and yet to mainstreamed.

11. Global Recycling Rates Hooray- 52% recycling rates achieved by Wales in 2013 Organisation for Economic Co-operation and Development,’OECD.Stat Waste data’, retrieved March 2013, available at http://stats.oecd.org/Index.aspx?DataSetCode=WASTE. All data is for 2010 except for Japan and Canada data (2008) and Australia, Chile, Iceland, Korea, and the UK (2009). Data for the Czech Republic and Denmark are national estimates. The Ireland figure is an estimated value. The OECD average is an estimate based on partial data.

12. International Green Jobs? • “Green Jobs” as defined by the ILO (jobs designed to reduce environmental harm): • over 7 million in the EU • over 3 million in the US • nearly 3 million in Brazil (equivalent to 6.6% of all formal employment). WARNING!!! Definitions are hotly debated — even new legal marijuana farms in several U.S. states will technically generate “Green Jobs” — but the estimates cited here come from most-reliable governmental and international sources.

13. Wales at a Glance GVA is the difference between the value of goods and services produced and the cost of raw materials and other inputs which are used up in production. GVA is used in the estimation of GDP. GDP is defined as the total value of all goods and services produced within a country or region. It is a key indicator of the state of the whole economy. Source: Office for National Statistics, April 2013

14. Welsh Context- Employment by Sector Regional Labour Market: HI10 - Headline Indicators for Wales, April 2013 (Excel sheet 2157Kb) http://www.ons.gov.uk/ons/datasets-and-tables/index.html

15. In a Nutshell…. Wales has the lowest regional GVA per head in the UK, with GDP per capita in West Wales and the Valleys being lower than some regions in Greece and Eastern Europe Unemployment in Wales is higher than the UK average and earnings continue to fall below the median for the UK. Wales needs to find a new way to prosper- existing mechanisms are not working for us!

16. What Can We Do and What Are We Doing? …WG Green Growth Stimuli Localisation of supply chains Minimisation of resource use Encouragement of green innovation Expansion of renewable energy mix. Source: Adapted from Climate Change Commission for Wales submission to the Council for Economic Renewal June 2013.

17. Who’s Involved in Stimulating Welsh Green Growth?

18. Existing Green Jobs in Wales (It’s Occurring?) • UK sales in the green economy (using the BIS LCEGS definition ) of £122.2 billion in 2010/11 in a global market of £3.3 trillion, placing the UK 6th globally • Green employment in Wales was 41,506 FTE in 2010/11: • 10,104 in Environment sector (£1.1bn) • 17,740 in Low Carbon sector (£2.2bn) • 13,662 in Renewables sector (£1.9bn) • Plus… employment in sectors which support the natural environment (approximated from employment in the food and farming and energy and environment priority sectors, veterinary services and forestry) supported over 203,000 jobs in Wales in 2011, over 16% of total employment in Wales.

19. Existing Green Jobs in Wales (It’s Occurring 2?) • There are particularly active growth areas. • Employment in the energy and environment sector grew just under 15% between 2010-11and employment in the food and farming sector grew by over 5% in the same year. • In addition, the value of the natural environment can be considered in terms of the traditionally defined “non-green jobs” it helps support. • Eg. tourism employment in Wales in 2011 was just over 115,000, 9% of total employment.

20. Future Potential of Green Jobs? • An ILO study suggests 10-20% of jobs depend on the existing “brown” economy (e.g. the fossil fuel industry) • Transition policies must be handled correctly to avoid serious displacements • High-level analysis identifies that material cost savings of up to £2.0bn a year in Wales could be achieved by transitioning to circular processes in an advanced scenario • The automotive and electronics industries, which represent £2,693m and £1,261m respectively in manufacturing turnover to the Welsh economy, present the highest potential for these savings (primarily by designing out waste, minimising packaging and re-using products and materials) • However, all sectors should consider how they can become more sustainable. • (Source: (Ellen Mcarthur Foundation 2013).

21. Wales- Examples of Green Growth in Action? Orangebox is a Welsh SME and UK leader in the design and manufacture of office furniture, with a factory in Hengoed, Mid Glamorgan. Howies clothing manufacture in Cardigan (minimise waste, repair clothes, use offcuts) Dawn meats of Cross Hands recycles food containers Castell Howell food suppliers re-use packaging, work with supply chains to reduce portion sizes and minimise waste SA Brains uses waste products as animal feed and fertilizer Dow Corning of Barry sell the primary by-products of silicon production to European partners GS Flooring, a social enterprise, provide reused commercial carpet tiles to community and third sector at reduced cost SEDA Packaging upcycle their high quality technical waste from paper cups by selling it to paper mills Etc….. There are lots of small and medium scale activities but green growth is yet to be mainstreamed.

22. The Rural Economy in Wales? The rural economy is more dependent upon and has a unique role in driving green growth, in particular:  Increasing the scale of renewable energy production where appropriate Securing returns for the value of water management and carbon storage in the uplands Developing sustainable tourist destinations Promoting high quality sustainable food production and processing Maximising the commercial value of natural capital.

23. Barriers and Challenges to Overcome Business as usual lock-in Business risk of a transition Up front costs Lack of understanding of terminology Lack of recognition of value of ecosystem services Wales’ dependence on external markets Limited access to appropriate resource flows, qualitatively and quantitatively Lack of processing and reprocessing plants in Wales Lack of practicality in supporting mechanisms Lack of green education, skills and training opportunities Lack of public procurement drivers Limited influence of Wales on UK fiscal policy.

24. Conclusions • Lack of definition of green economy in Wales • General support across government, business and environment sectors for green economy principles • Some good but ad hoc examples of green growth, mainly in the south (more needed across the rest of Wales) • Lack of a baseline to chart progress • Lack of linkages between green growth activities (lack of infrastructure) • No vibrant green economy… yet (Nessa’s doesn’t think it’s occurred yet).

25. Final Thoughts Some suggestions, offered to generate discussion: • What are the barriers to the use of alternative indicators, including a Green GDP or equivalent measure? • Should there be new laws, incentives and regulations to drive increasing investment in the Green Economy, eg. through regulating and incentivizing the manufacturing sector? • What shade of green is right for Wales- jade (more of tried and tested approaches), mint (different way of applying tried and tested approaches) or lime (innovative approaches with new ideas)?

26. Thank you for your attention! Jeanette@cynnalcymru.com www.cynnalcymru.com | www.sustainwales.com Follow us on Twitter | Dilynwch ni ar Twitter @CynnalCymru 02920 19 20 21

27. Further Information and References Atkisson A (2013) Green Economy 2013. A Strategic Briefing on the State of Play in the Global Transition. Sustainability Intelligence Unit. CBI (2012) The Colour of Growth- Maximising the Potential of Green Business. Confederation of British Industry. Ellen McArthur Foundation (2013) Wales and the Circular Economy. GJI (2012) Working towards sustainable development: Opportunities for decent work and social inclusion in a green economy. Published by the Green Jobs Initiative. Government of Ireland (2012) Delivering Our Green Potential- Government Policy Statement on Growth and Employment in the Green Economy. Green Growth Advisory Group (2011) Greening New Zealand’s Growth- Report of the Green Growth Advisory Group. Downloaded from http://www.med.govt.nz/sectors-industries/environment/pdf-docs-library/Greening%20New%20Zealands%20Growth.pdf on 9th October 2013. http://wefo.wales.gov.uk/news/casestudies/?lang=en Downloaded 10th November 2013. OECD (2009) OECD and Green Growth. Downloaded from http://www.oecd.org/greengrowth/44273385.pdf on 9th October 2013. OECD (2011) Towards Green Growth: A Summary for Policy Makers. May 2011 UNEP (2011) Towards a Green Economy- Pathways to Sustainable Development and Poverty Eradication. United National Environment Programme. United Nations (2012) Rio +20 Outcome Document– The Future We Want- Part III. Green Economy in the Context of Sustainable Development and Poverty Eradication UNEP (2010) Green Economy Developing Countries Success Stories. United Nations Environment Programme, Geneva. Welsh Assembly Government (2009) One Wales One Planet- The Sustainable Development Scheme of the Welsh Assembly Government. WWF (2012) Building Green Economies- Creating Prosperity for People and Planet. Downloaded from http://assets.wwf.org.uk/downloads/building_green_economies_oct_2012_lo.pdf on 9th November 2013.