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Developing Resource use Scenarios for Europe

Author

Listed:
  • Marina Fischer-Kowalski
  • Dominik Wiedenhofer
  • Willi Haas
  • Irene Pallua
  • Daniel Hausknost

Abstract

Chapter 1 of this report reviews a number of approaches to conceptualize and operationalize biophysical constraints for economic performance. The starting point is a scoping study by Cambridge Econometrics and Sustainable Europe Research Institute (SERI) that reviews a large number of macroeconomic models investigating their ability to provide information on the interlinkages between the economy and the environment required from a sustainability viewpoint. This scoping study yields two key recommendations for macroeconomic modelling: to incorporate resource use in the explanation of economic development, and to allow for non-linear relationships, thresholds and limits (Serice 2010). The report then turns to another useful approach from OECD that makes an effort to conceptualize causal pathways linking global environmental change (originally: climate change) to economic development via policy regulations, direct biophysical impacts and price effects on global markets (OECD/Martinez-Fernandez et al. 2010). The three types of effects are discussed. In a next section, insights from a report from the FP7-NEUjobs project are presented. In this project, a wide array of (mainly) natural science literature had been screened to identify “global megatrends” that would impact European economies and policy-making. Given far-reaching uncertainties and complex interrelations, the megatrends identified (i.e. energy transitions, rising challenges to resource security and increasing climate change impacts) are grouped to envision two future world contexts for Europe, a “tough” and a more “friendly” world. For the year 2025, the features of these worlds are sketched on the basis of a literature review (NEUjobs 2012). The chapter concludes that indeed the availability and use of natural resources provides a key link between economies and the environment, but that it is advisable to deal with them not one by one, but in a systemic fashion that takes into account their strong interrelationships on the one hand, and the high uncertainty of constraints of particular resources on the other. It concludes that the future of European resource supply may be expected to be fairly different from the past, and should be expected to change to the worse, both for environmental reasons and for reasons of strongly increasing international demand and competition. Chapter 2 is devoted to a descriptive analysis of the changes in global and European resource use in the past and emphasises the non-linearities that can be observed. It focuses on long-term structural changes in the energetic base of socio-economic systems, leading to fundamental transformations in the scale and quality of society-nature interactions. Similar fundamental transformations should be expected for the (inevitable) transition from fossil to renewable energy sources. Based on a set of case studies of industrial countries for which long term data series for resource use (material and energy use) are available, it discusses the transition from the agrarian to the industrial metabolic regime and seeks to identify structural breaks in the development of energy use in the second half of the 20th century. The main finding is that a stabilization of per capita energy and resource use in most high-income countries was reached in the early 1970ies that is still lasting, after a period of accelerated growth of resource use since the end of World War II. During this time the so-called „decoupling? of energy and materials use from economic growth became much more pronounced, a phenomenon we describe as the “1970s syndrome”. An explanation of this common and marked turn in the upward trend of energy and materials consumption needs more research and will be further pursued in work package 201. Finally, Chapter 3 suggests four scenarios for European resource use up to the year 2050, aligning with the global resource use scenarios developed by UNEP?s International Resource Panel (2011). A “trend scenario” prolonging Europe?s resource use into the future proves to be very close to the “freezing” scenario proposed by UNEP for high income industrial countries, and leads to an average per-capita resource use in Europe on the same level as in the early 2000s. A “best practice scenario” generalizes the past success of some European countries in downsizing their resource use to all European countries up to 2050. The fourth scenario, the 2 “radical transformation scenario”, follows UNEP?s “moderate contraction and convergence” scenario in halving the per capita annual resource use of European countries, leading to what is commonly called “absolute decoupling”. The last part of the chapter is devoted to the feasibility of such a scenario, on the one hand, and the consequences this might have for the European economies. The concluding remarks emphasize that a successful scenario exercise requires an intimate collaboration between macroeconomic modellers and scientists contributing from the environmental and socio-ecological angle. There will be place for such collaboration in the further course of the WWWforEurope project.

Suggested Citation

  • Marina Fischer-Kowalski & Dominik Wiedenhofer & Willi Haas & Irene Pallua & Daniel Hausknost, 2013. "Developing Resource use Scenarios for Europe," WWWforEurope Working Papers series 25, WWWforEurope.
  • Handle: RePEc:feu:wfewop:y:2013:m:7:d:0:i:25
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    References listed on IDEAS

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    1. Gonzalez-Martinez, Ana Citlalic & Schandl, Heinz, 2008. "The biophysical perspective of a middle income economy: Material flows in Mexico," Ecological Economics, Elsevier, vol. 68(1-2), pages 317-327, December.
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    3. A. Greening, Lorna & Greene, David L. & Difiglio, Carmen, 2000. "Energy efficiency and consumption -- the rebound effect -- a survey," Energy Policy, Elsevier, vol. 28(6-7), pages 389-401, June.
    4. Aleklett, Kjell & Höök, Mikael & Jakobsson, Kristofer & Lardelli, Michael & Snowden, Simon & Söderbergh, Bengt, 2010. "The Peak of the Oil Age - Analyzing the world oil production Reference Scenario in World Energy Outlook 2008," Energy Policy, Elsevier, vol. 38(3), pages 1398-1414, March.
    5. Krausmann, Fridolin & Gingrich, Simone & Eisenmenger, Nina & Erb, Karl-Heinz & Haberl, Helmut & Fischer-Kowalski, Marina, 2009. "Growth in global materials use, GDP and population during the 20th century," Ecological Economics, Elsevier, vol. 68(10), pages 2696-2705, August.
    6. Calvo-Gonzalez, Oscar & Shankar, Rashmi & Trezzi, Riccardo, 2010. "Are commodity prices more volatile now ? a long-run perspective," Policy Research Working Paper Series 5460, The World Bank.
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    Cited by:

    1. repec:feu:wfedel:y:2016:m:2:d:0:i:11 is not listed on IDEAS
    2. Mikulas Luptácik & Eduard Nežinský & Martin Lábaj, 2015. "Drivers of the change in social welfare," WWWforEurope Working Papers series 105, WWWforEurope.
    3. repec:feu:wfedel:y:2016:m:2:d:0:i:12 is not listed on IDEAS
    4. Karl Aiginger, 2016. "Political Rebound Effects as Stumbling Blocks for Socio-ecological Transition," WIFO Working Papers 519, WIFO.
    5. Dominik Wiedenhofer & Marina Fischer-Kowalski, 2015. "Achieving absolute decoupling? Comparing biophysical scenarios and macro-economic modelling results," WWWforEurope Working Papers series 86, WWWforEurope.

    More about this item

    Keywords

    Biophysical constraints; CGE models; economic growth path; economic strategy; industrial innovation; industrial policy; innovation policy; socio-ecological transition;

    JEL classification:

    • Q3 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics

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