Sustainable Economic Growth with pollution fees

Stephen Hinton
Stephen Hintonconsultant at AVBP A Very Beautiful Place
At the start of the last
  century most were
convinced flying was
   an impossibility
In the 21st century,          most are
    convinced transitioning to
      sustainability is an

impossibility
     (With economic growth at the same time)


                   The Swedish Sustainable Economy Foundation – tssef.se
TSSEF presents an
 alternative view
      The Swedish Sustainable Economy Foundation – tssef.se
The science gives clear objectives
2
Nitrogen
Phosphorus
  P
LEAKAGE=


                           C
                                     NON-RENEWABLES:
                                     e.g. Fossil energy



Abundant and should be
recycled                        Can be recycled but in short supply
e.g. Nitrogen                   e.g. Phosphorus



              N                        P
MONEY LEAKS OUT TOO
                                                                                                                                           $
$                                                                             $                               Fossil fuel import:
                                                                                                              13,000,000 m3
                                                                                                              Costs: climate change



Nitrogen import 160 000 ton
Costs: water purification and
                                                                                                         Import of Phosphorus
                                                                                                         18,400 ton
                                                                                                                                           $
Baltic sea clean-up                                                                                      Costs: water purification and
                                                                                                         Baltic sea clean-up


                            N                                                                                            P
$Swedish agricultural land had an annual net import of about 10,600 tonnes of phosphorus corresponding to 3.2 kg phosphorous per hectare
 Linderholm, Kersti and Mattsson, Jan Erik (2013). Analys av fosforflöden i Sverige.
 Sveriges lantbruksuniversitet: rapportserie ; 2013:5
                                                                                                                                           $
P&N: per kilo
20kr import
*200kr water works
**Baltic Sea clean-up 3200 kr



 Sources*IVL **Sarah Säll, doktorand i miljöekonomi vid SLU
Stopping the leakage of money
  and resources from the nation
and the national economy, is good
 business and in effect grows the
     economy as the money
           recirculates
Resources


            money
return

Resources




            procure   use
Sustainable Economic Growth with pollution fees
Systems that emit have been
cheaper
CONTROL ENGINEERING
the engineering discipline that designs
systems to produce desired behaviors.

Typical for control engineered
environments:
• sensors measure the behaviour of the
object being controlled
• feedback to
• actuators that can make corrections
toward desired performance.
Sustainable Economic Growth with pollution fees
SYSTEM: The commericial and social system’s use of polluting
                   substances
BEHAVIOUR DESIRED: That market forces act to transition technical
                   infrastructure, management and praxis so emissions
                   reach a reasonable, acceptable level.
          SENSORS: Economic indicators of sales of clean tech, sales of
                   pollutant-bearing substances, financial indicators of e.g.
                   futures contracts and technilca indicators on emissions.
         FEEDBACK: Figures are collated and fed to expert committee.
        ACTUATORS: The regular import/extraction fee that is adjusted to
                   ensure behaviour of system.
Flexible emission control fees are tariffs imposed by authorities
on the import or extraction of specific substances.

The purpose of the mechanism is to control the rate of phase
out to keep both socio-economic and ecological stress to the
minimum necessary.

The level of fee imposed is flexible, i.e. adjusted regularly,
based on information from a monitoring function of
market behavior including the rate of abatement compared to
phase-out goals and other factors.

The mechanism includes economic feedback, returning fees
collected to the economy via dividends or other routes.

The adjustments, together with the dividend comprise
a control mechanism that ensures the transition to an
economic and safe use of the substance in the societal system.
FLEXIBLE EMISSION FEES

                                                                         MEASURE



                                   purchase                                           Technology
            Consumers                               Service production     Clean
                                                                           Tech
                                                                                       providers

FEEDBACK




                                                           substance
                 Dividend




                               CORRECT-
                                 IONS

                                         Rate                                          FINANCE
           Authority sets limits                      Import/production
                                                                                   Futures markets
           and phase out rates                Fee          actors
                                                                                     Investors etc


                                                MEASURE                    FEEDBACK            MEASURE
changes too
    slow:
raise the fee.
  too fast:
  lower it.
THE PHOSMARK
     PROJECT
• Gotland as Sweden in
miniature
• Investigates the circular
P and N economy
• Conference 2015
Maybe some
              government support
              will be needed in the
                   beginning of
                 introduction of
                dynamic control




The Swedish Sustainable Economy Foundation – tssef.se
1 of 23

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Sustainable Economic Growth with pollution fees

  • 1. At the start of the last century most were convinced flying was an impossibility
  • 2. In the 21st century, most are convinced transitioning to sustainability is an impossibility (With economic growth at the same time) The Swedish Sustainable Economy Foundation – tssef.se
  • 3. TSSEF presents an alternative view The Swedish Sustainable Economy Foundation – tssef.se
  • 4. The science gives clear objectives
  • 5. 2
  • 8. LEAKAGE= C NON-RENEWABLES: e.g. Fossil energy Abundant and should be recycled Can be recycled but in short supply e.g. Nitrogen e.g. Phosphorus N P
  • 9. MONEY LEAKS OUT TOO $ $ $ Fossil fuel import: 13,000,000 m3 Costs: climate change Nitrogen import 160 000 ton Costs: water purification and Import of Phosphorus 18,400 ton $ Baltic sea clean-up Costs: water purification and Baltic sea clean-up N P $Swedish agricultural land had an annual net import of about 10,600 tonnes of phosphorus corresponding to 3.2 kg phosphorous per hectare Linderholm, Kersti and Mattsson, Jan Erik (2013). Analys av fosforflöden i Sverige. Sveriges lantbruksuniversitet: rapportserie ; 2013:5 $
  • 10. P&N: per kilo 20kr import *200kr water works **Baltic Sea clean-up 3200 kr Sources*IVL **Sarah Säll, doktorand i miljöekonomi vid SLU
  • 11. Stopping the leakage of money and resources from the nation and the national economy, is good business and in effect grows the economy as the money recirculates
  • 12. Resources money
  • 13. return Resources procure use
  • 15. Systems that emit have been cheaper
  • 16. CONTROL ENGINEERING the engineering discipline that designs systems to produce desired behaviors. Typical for control engineered environments: • sensors measure the behaviour of the object being controlled • feedback to • actuators that can make corrections toward desired performance.
  • 18. SYSTEM: The commericial and social system’s use of polluting substances BEHAVIOUR DESIRED: That market forces act to transition technical infrastructure, management and praxis so emissions reach a reasonable, acceptable level. SENSORS: Economic indicators of sales of clean tech, sales of pollutant-bearing substances, financial indicators of e.g. futures contracts and technilca indicators on emissions. FEEDBACK: Figures are collated and fed to expert committee. ACTUATORS: The regular import/extraction fee that is adjusted to ensure behaviour of system.
  • 19. Flexible emission control fees are tariffs imposed by authorities on the import or extraction of specific substances. The purpose of the mechanism is to control the rate of phase out to keep both socio-economic and ecological stress to the minimum necessary. The level of fee imposed is flexible, i.e. adjusted regularly, based on information from a monitoring function of market behavior including the rate of abatement compared to phase-out goals and other factors. The mechanism includes economic feedback, returning fees collected to the economy via dividends or other routes. The adjustments, together with the dividend comprise a control mechanism that ensures the transition to an economic and safe use of the substance in the societal system.
  • 20. FLEXIBLE EMISSION FEES MEASURE purchase Technology Consumers Service production Clean Tech providers FEEDBACK substance Dividend CORRECT- IONS Rate FINANCE Authority sets limits Import/production Futures markets and phase out rates Fee actors Investors etc MEASURE FEEDBACK MEASURE
  • 21. changes too slow: raise the fee. too fast: lower it.
  • 22. THE PHOSMARK PROJECT • Gotland as Sweden in miniature • Investigates the circular P and N economy • Conference 2015
  • 23. Maybe some government support will be needed in the beginning of introduction of dynamic control The Swedish Sustainable Economy Foundation – tssef.se