POLICY HIGHLIGHTS
BETTER POLICIES FOR BETTER LIVES
Material resources,
productivity and
the environment
POLICY HIGHLIGHTS
Overview
Establishing a resource efficient economy is central to achieving
green growth. It involves improving resource pr...
Natural resources provide essential raw materials, water and other
commodities to support economic activity, and are an im...
POLICYHIGHLIGHTS
Rising material demand presents
challenges and opportunities
The last decades have witnessed unprecedente...
Rising demand for materials affects the ways in
which natural resources are supplied to, and used
in the economy.
•	 They ...
Progress in material productivity can be attributed
to policy action and technological change, as well
as to structural ch...
Urban mines: an
important, undervalued
source of raw materials
Closing the loop of the material cycle:
better policies for...
Filling knowledge gaps:
better information for better policies
A considerable amount of work has been carried out over the...
BETTER POLICIES FOR BETTER LIVES
For more information:
http://www.oecd.org/env/waste
http://www.oecd.org/env/waste/materia...
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Oecd 2014 material resources policy highlights web

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Establishing a resource efficient economy is central to achieving green growth. It involves improving resource productivity and putting in place policies that ensure a sustainable resource and materials management building on the principle of the 3Rs — reduce, reuse and recycle, and encouraging more sustainable consumption patterns.

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Oecd 2014 material resources policy highlights web

  1. 1. POLICY HIGHLIGHTS BETTER POLICIES FOR BETTER LIVES Material resources, productivity and the environment POLICY HIGHLIGHTS
  2. 2. Overview Establishing a resource efficient economy is central to achieving green growth. It involves improving resource productivity and putting in place policies that ensure a sustainable resource and materials management building on the principle of the 3Rs — reduce, reuse and recycle—, and encouraging more sustainable consumption patterns. Better resource productivity helps to improve the environment, by reducing the amount of resources that human economic activity requires and diminishing the associated environmental burden. It also helps to sustain economic growth by securing adequate supplies of materials, improving competitiveness and fostering new technologies and innovation. To be successful such policies need to founded on a good understanding of the material basis of the economy, of international and national flows of materials, and of the factors that drive changes in resource use and productivity over time, across countries and in the different sectors of the economy. Some natural resources, such as water, energy, forests, are monitored internationally, but information is insufficient to give an integrated view of how minerals, metals, or timber flow through the economy throughout their life cycle. In addition, little is known about how this affects the productivity of the economy and the quality of the environment. The OECD report Material Resources, Productivity and the Environment is a first step to fill some of these gaps. It describes the material basis of OECD economies. It examines how material resources flow between the economy and the environment, and the factors that drive changes in resource productivity over time and across countries. The report uses concepts and tools from material flow analysis and accounting, and provides a factual basis to help understand some of the key challenges and opportunities associated with material resources and resource productivity in OECD countries. Improving resource productivity contributes to economic growth and to the reduction of pressures on the environment. The OECD puts “resource productivity” in a welfare perspective. It is understood to contain both a quantitative dimension (e.g. the quantity of output produced with a given input of natural resources) and a qualitative dimension (e.g. the environmental impacts per unit of output produced with a given natural resource input). Source: 2008 Recommendation by the OECD Council on Resource Productivity. POLICYHIGHLIGHTS “ © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT . 32 . © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT
  3. 3. Natural resources provide essential raw materials, water and other commodities to support economic activity, and are an important source of income and jobs. As part of broader ecosystems, they support the provision of ecosystem services – climate regulation, flood control, natural habitats, amenities, cultural services – that are necessary to develop man-made, human and social capital. The use of materials from natural resources in economic activities and the related production and consumption processes have many environmental, economic and social consequences that extend beyond the borders of individual countries or regions, and that affect future generations. They have consequences on: • The rate of extraction and depletion of renewable and non- renewable natural resource stocks, and the extent of harvest and the reproduction capacity and natural productivity of renewable resource stocks. • The environmental pressures associated with the extraction, processing, transport, use and disposal of materials (e.g. pollution, waste, habitat disruption); and their impacts on environmental quality (e.g. air, climate, water, soil, biodiversity, landscape), on ecosystem services and on human health. • International trade and market prices of raw materials and other goods. • The productivity and the competitiveness of the economy. The way natural resources and materials are managed and used all way through the economy is thus important, not only from an environmental perspective but also from an economic and trade perspective. Natural resources are fundamental to the economy and human well-being A development pattern that depletes the economy’s natural asset base without providing secure, long-term substitutes for the goods and services that they provide is unlikely to be sustainable. The environmental consequences of the use of natural resources and materials occur at different stages of the resource cycle and affect the quantity and quality of natural resource stocks and the quality of ecosystems and environmental media. The type and intensity of these consequences depend on the kind and amounts of natural resources and materials used, the way these resources are used and managed, and the type and location of the natural environment from where they originate. POLICYHIGHLIGHTS Graphic 1: The commercial material cycle and the 3Rs - closing the loop 3R and circular economy initiatives aim at closing materials loops and extending the lifespan of materials through longer use, reuse and remanufacturing, and the increased use of secondary raw materials. These initiatives also aim at material substitution: using materials with lower environmental impact, and replacing the environmentally most damaging materials. Reduce Recycle Re-manufacture Re-use Resource extraction Processing Manufacture Use Final disposal Releases to the environment (pollution, waste). land use, habitat alteration... © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT . 54 . © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT
  4. 4. POLICYHIGHLIGHTS Rising material demand presents challenges and opportunities The last decades have witnessed unprecedented growth in demand for raw materials worldwide, driven in particular by the rapid industrialisation of emerging economies and continued high levels of material consumption in developed countries. The amount of materials extracted, harvested and consumed worldwide doubled since 1980, an estimated ten-fold increase since 1900; it reached nearly 72 billion metric tonnes (Gt) in 2010, and is projected to reach 100 Gt by 2030. Growth has been primarily driven by global demand for construction materials, fossil fuels, and biomass for food. At the same time, international commodity markets have expanded, with increasing international trade flows, increasing mobility and fragmentation of production factors, and expanding linkages among countries and regions. This has been accompanied by increasing and highly volatile commodity prices and by growing competition for some raw materials. Figure 1: Global extraction of material resources, world and world regions World, 1980-2010 OECD and world, 1990, 2010 Source: SERI and Dittrich, M. (2014). Global Material Flow Database. 2014 Version. Available at www.materialflows.net. OECD (2013). Material flow database. Note: BRIICS: Brazil, Russian Federation, India, Indonesia, China. Did you know… OECD countries account for: • Slightly less than half of the global economy (using PPPs) compared to about 60% in 2005. • Less than one-third of all material resources consumed worldwide compared to 43% in 1990. Growing demands for materials worldwide and the globalisation of supply chains change the ways in which materials are supplied to the economy and raise concerns as to the environmental impacts of their use create opportunities for new markets and greener growth 0 10 20 30 40 50 60 70 1980 1990 2000 2005 2010 Biomass Fossil energy carriers Metals Construction & industrial minerals billion tonnes (Gt) % change, 1980-2010 48% 66% 87% 202 % OECD 27% BRIICS 51% rest of world 22% World 2010 material extraction 72 billion tonnes OECD 43% BRIICS 34% rest of world 23% World 1990 material extraction 43 billion tonnes 6 . © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT . 7
  5. 5. Rising demand for materials affects the ways in which natural resources are supplied to, and used in the economy. • They raise questions about the sustainability of natural resource use and the negative environmental impacts of production and consumption of resources, as well as about risks of disruptions in materials supply. • As production and consumption have become displaced with increasingly complex and globalised value chains, questions also arise about the distribution of the environmental burden associated with material use. By 2050, the world economy is expected to quadruple and the global population to grow to over 9 billion, placing additional strain on the earth’s material resources and the environment. Material productivity is improving, but decoupling remains weak Material extraction and consumption in OECD countries have increased, but much more slowly than at the global level. Material productivity is improving and there are signs of decoupling of material consumption from economic growth. Today, OECD countries generate 50% more economic value with one tonne of raw materials than they did in 1990 and 30% more than in 2000. The domestic material productivity of OECD economies rose from 1400 USD per tonne in 2000 to over 1800 USD per tonne in 2011 (in constant prices and PPPs). Decoupling has occurred overall in the OECD area, across all material groups. POLICYHIGHLIGHTS A growing population with higher average income requires more food, more industrial products, more energy and more water. This creates formidable economic and environmental challenges. Confronting the scale of these challenges requires ambitious policies to achieve a significant increase in resource productivity, particularly through technical change and innovation, and through more effective management approaches. This will in turn create opportunities for investment, for new products and markets, and for employment. OECD countries generate 50% more economic value with one tonne of raw materials than in 1990 Source: SERI and Dittrich, M. (2014). Global Material Flow Database. 2014 Version. OECD (2013). Material flow database. Figure 2: Material consumption and decoupling Material consumption per capita, OECD and world, 1980-2010, kg/cap/day Decoupling trends, OECD, world 1990 -2011 or latest available year Material consumption per capita, OECD, 2010/11, kg/day 0 10 20 30 40 50 60 World OECD 2010 2000 1980 50 75 100 125 150 175 200 1990 1995 2000 2005 2010 Index 1990=100 material consumption GDP OECD 50 75 100 125 150 175 200 1990 1995 2000 2005 2010 Index 1990=100 material consumption GDP World 10 18 5 13 Biomass (food, feed, wood) Construction & industrial minerals Metals Fossil fuels 46 kg per person per day Decoupling is breaking the link between “environmental bads” and “economic goods”. Absolute decoupling occurs when environmental degradation or environmental pressures are decreasing while the economy is growing. Decoupling is relative when environmental degradation or environmental pressures are growing, but at a slower rate than the economy 8 . © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT . 9
  6. 6. Progress in material productivity can be attributed to policy action and technological change, as well as to structural changes, including the rise of the service sector and the substitution of resource intensive domestic production by imported goods. The economic slowdown following the financial and economic crisis plays an important role in recent developments due to an important decline in the demand for materials, in particular construction materials. Prior to 2007, there were only a handful of instances of absolute decoupling of material consumption from economic growth. Since then, a majority of OECD countries display an absolute decoupling. As economic growth resumes, the demand for materials will increase and will exceed pre-crisis levels unless countries strengthen resource productivity policies and measures. The consumption of material resources to support economic activity remains high. An average person living in an OECD country consumes about 46 kg of materials per day (about 60% more than the world average), including 10 kg of biomass, 17 kg of construction minerals, 5kg of metals and about 13 kg of fossil fuels. Productivity gains have been achieved in recent years, but material consumption remains high and progress is moderate once indirect flows associated with trade are considered As OECD economies become more service- based, their reliance on imports is increasing with resource-intensive production often being displaced to non-OECD economies. Imports make up almost one-third of material inputs in the OECD area, compared to one quarter in 1990. They make up 40% in OECD Europe and in OECD Asia-Pacific; and less than 15% in OECD Americas. Finished and semi-finished products weigh significantly less than the raw materials from which they are derived. When accounting for all the raw materials that are required to produce a good but that are not physically incorporated into the traded product, the productivity gains in countries that are net resource importers are more modest. From waste to resources The amount of solid waste generated by economic activity is rising in line with growing consumption of material resources. Many valuable materials continue to be disposed of as waste and, if not recovered, are lost to the economy. But efforts to recycle waste are starting to pay off, and a generally positive trend can be observed for municipal waste (representing roughly 10% of total waste). • The amount of municipal waste generated per year is around 660 million tonnes; per capita generation decreased by 5% (to 530 kilograms per person compared to 560 in 2000), but remains high compared to other countries in the world, and is still higher than in the early 1990s. • Municipal solid waste is increasingly being diverted from landfills and kept in the economy through recovery or recycling. • Markets for secondary raw materials are expanding, but have to cope with volatile commodity prices. • Recycling rates have increased for a large range of important materials, such as glass, steel, aluminium, paper and plastics, reaching levels as high as 80% for some of these materials. There are however many precious or specialty metals that are not recycled or for which recycling rates remain very low. Efforts to move from waste to resources show first results. Recycling rates are high for a number of materials, but many valuable materials continue to be disposed of as waste Figure 3: Decoupling trends and municipal waste Source: OECD environmental statistics (database). Note: Data contains estimates. Decoupling trends, OECD countries, 1990-2011 Municipal waste, OECD countries, 1995-2011 POLICYHIGHLIGHTS 80 100 120 140 160 1990 1995 2000 2005 2010 GDP Municipal waste // 0 0 100 200 300 400 500 600 1995 2000 2005 2011 560 530520 530 560560 19% 25% 33%30% 16% 16% 19%17% 64% 58% 48%53% Material recovery Energy recovery Disposal Share in % going to : Amounts in kg per capita 80 100 120 140 160 1990 1995 2000 2005 2010 GDP Municipal waste // 0 10 . © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT . 11
  7. 7. Urban mines: an important, undervalued source of raw materials Closing the loop of the material cycle: better policies for greener growth Resource productivity is essential to future economic growth and development, and hence to prosperity. In the past ten to fifteen years, improving resource productivity has become a priority for governments and businesses alike. Many countries are taking action and some have set national targets for material productivity. Sustainable resource use and resource productivity are also high on the international policy agenda. They have been addressed by the Heads of State and Government of G8 countries, and are actively promoted by the OECD, UNEP and the European Commission. Much more is however needed to effectively decouple the use of material resources from economic growth so as to reduce the associated negative environmental impacts and avoid waste of valuable resources. This involves scaling-up existing policies, establishing proper framework conditions, and ensuring that policies are more coherent and better integrated. Some of the key challenges are linked to the transboundary dimension and complexity of most supply chains and the large number of economic actors and government agencies that need to be involved in such policies. • It requires measures and investments to support technological change and innovations, and to promote integrated life-cycle- oriented approaches, such as 3R policies, sustainable materials management and sustainable manufacturing. Significant potential exists for efficiency gains and improved resource productivity in many sectors, including construction, transport, agriculture and manufacturing. • It also requires efforts in policies that affect trade in raw materials and in certain types of waste, enhanced international co-operation and capacity development Sustainable materials management (SMM)... ...is defined as an approach to promote sustainable materials use, integrating actions targeted at reducing negative environmental impacts and preserving natural capital throughout the life-cycle of materials, taking into account economic efficiency and social equity. The key principles that should be used when developing SMM policies and strategies are: the preservation of natural capital, the life-cycle perspective, the use of the full range of policy instruments and multi-stakeholder approach POLICYHIGHLIGHTS 12 . © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT . 13 Raw materials are usually extracted or produced from natural resource stocks. Valuable materials can also be gained from the recovery and recycling of solid waste by diverting materials from the waste stream before final disposal. They can further be extracted from final waste disposal sites such as landfills, where solid waste has accumulated over long periods. Valuable resources are also found in the built environment, and in products and appliances in use. These “urban mines” are an important source of minerals and metals for industry (e.g. electric and electronic equipment), and a potentially important domestic source of raw materials in the future. Estimates quantifying the amount of raw material locked in the economy indicate that the size of future urban mines could be significant. Reliable estimates have been made for only a few metals. For example, the stocks of iron locked in the economy are estimated between 12 and 18 million tonnes or roughly 15-20% of global iron ore reserves in 2011. These estimates form a picture of the amount of material that could one day be available for reuse or recycling free of technical or economic constraints. Urban mines
  8. 8. Filling knowledge gaps: better information for better policies A considerable amount of work has been carried out over the past ten years to develop the methods to analyse material flows and to develop appropriate indicators to monitor progress. Almost all OECD countries have developed initiatives in this area. In Europe, reporting on materials flows has become mandatory. This is supported by the adoption at UN level of the System of Environmental-Economic Accounting (SEEA) as an international statistical standard. However, missing information and inconsistencies still limit the tracking of progress with resource productivity in many countries and at international level. Important gaps include the following: • Material flows that do not enter the economy as transactions, but that are relevant from an environmental point of view, including unused materials such as mining overburden and indirect flows of raw materials associated with trade. • Material flows of importance to the 3Rs, including flows of recyclable materials and secondary raw materials, and flows of waste. Distinguishing between primary and secondary raw materials is crucial for assessing resource productivity and decoupling trends. • The size and the value of the urban mine: with the exception of some of the most common industrial metals, there are insufficient estimates of stocks of material locked in the economy to form a reliable picture of their potential to contribute to future supply. Capitalising on the potential of the urban mine will require not only better knowledge of its size, but also its dynamics, how it evolves over time and in relation to virgin stocks. • Industry-level and material-specific information that is needed to indicate opportunities for improved performance and efficiency gains in production and consumption processes along the supply chain. • Compatible databases for key materials and substances, including critical raw materials, environmentally harmful substances and substances that play a role in global biogeochemical cycles. Many countries have taken initiatives to measure material flows and resource productivity but significant gaps remain There is also considerable scope for deeper analysis of particular resources and materials, and their interactions. Examples include trade related resource flows and flows of secondary raw materials, the way they interact with commodity prices and recycling markets, and how they relate to innovation and to natural resource stocks. Future work will also need to further explore the environmental impacts and the costs of material resource use throughout the life-cycle of materials, as well as the economic and environmental opportunities provided by improved resource productivity. An important task is to improve understanding of the trade-offs that need to be made. Better information will also help make a strong case for policies aimed at improving resource productivity by showing the full benefits of such policies. Further reading • OECD (2014), Material Resources, Productivity and the Environment, OECD Publishing, Paris. • OECD (2014), Green Growth Indicators 2014, OECD Publishing, Paris. • OECD (2012), Sustainable Materials Management: Making Better Use of Resources, OECD Publishing, Paris. Photo credits © Istockphoto.com/MichaelUtech © igor - Fotolia.com © xalanx - Fotolia.com © GraphEGO/Shutterstock.com © Stelios Theocharous © kaband/Shutterstock.com © Eunika Sopotnicka/Shutterstock.com POLICYHIGHLIGHTS © Istockphoto.com/5xinc © Istockphoto.com/yangwenshuang © Istockphoto.com/nullplus © monkeybusinessimages © Istockphoto.com/cinoby © Istockphoto.com/PN_Photo © fovivafoto - Fotolia.com 14 . © OECD SCALING UP FINANCE MECHANISMS FOR BIODIVERSITY © OECD SCALING UP FINANCE MECHANISMS FOR BIODIVERSITY . 1514 . © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT © OECD MATERIAL RESOURCES, PRODUCTIVITY AND THE ENVIRONMENT . 15
  9. 9. BETTER POLICIES FOR BETTER LIVES For more information: http://www.oecd.org/env/waste http://www.oecd.org/env/waste/material-resources-productivity-and- environment.htm The OECD works with its member countries and international partners to further develop resource productivity indicators, and improve information on material flows, natural resource stocks, and the environmental impacts and costs of resource use. This is done in collaboration with UNEP and its International Resource Panel, Eurostat and several research institutes.

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