Serietitel nr. 807, 2003 Whole-Systems Framework for Sustainable Consumption and ProductionContents1 A Framework for the Implementation of Sustainable Consumption and Production
1.1 The Call for a Framework of ProgramsThe 2002 World Summit on Sustainable Developments Plan of Implementation recorded its delegates recommended actions for achieving global sustainable development. Chapter three of the Plan calls for a shift away from patterns of unsustainable consumption and production and for the creation of a ten-year framework of programs to bring the requested actions into fruition. The UN, individual governments, and the private sector have environmental initiatives of almost every imaginable type and form: educational, technological, monitoring, financial, development-based, production-focused and more. Yet the World Summit on Sustainable Development1 and the UNEP DTIE Global Status 2002: Sustainable Consumption2 concur: the combined effect of these programs has fallen short of achieving our goal of global sustainability. 1.2 The Call for Better ModelsNew models and methodologies that integrate sustainable consumption and production are key to successful sustainability efforts. The "Way Forward" section of UNEPs Global Status 2002: Cleaner Production prioritizes the integration of cleaner production and sustainable consumption efforts in its list of "elements to facilitate greater implementation of Cleaner Production."3 The report lists three necessary steps to achieving this integration, notably, "the development of methodologies which help in simultaneously addressing the issues related to Cleaner Production and Sustainable Consumption." 4 The corollary UNEP report, Global Status 2002: Sustainable Consumption, elaborates. The report identifies modeling as one of six strategic areas that need development in future sustainable consumption efforts. Strategic Area Three calls for:
This paper proposes a whole-systems model that expands on conventional consumption-production models by describing the linked cycles of unsustainable investment, production, consumption, and waste. Whole-systems models are more complete and are therefore better situated to identify coordinated networks of strategic interventions in an effort to move beyond interventions that only affect one part of a system. This paper will then recommend programmatic responses based on the work the Rocky Mountain Institute has developed in the areas of whole-systems thinking, Natural Capitalism, manufacturing efficiency, and alternative energy and energy systems. Our programs are organized into three groups: Systems Thinking, Green Design, and Regional Development.
2 A Whole-Systems Approach to Sustainable Production and Consumption2.1 Reframing Production-Consumption Models: The Investment, Production, Consumption, Waste CycleSuccess in the global efforts to shift towards sustainable consumption and production depends on an accurate and comprehensive model of the systems of consumption and production. Starting with such a model, it becomes possible to study the complete life cycle of a particular environmental problem; to discover where in the life cycle effective interventions can be made; and to produce metrics to measure the effectiveness of interventions. The Investment, Production, Consumption, Waste (IPCW) cycle that this paper proposes (see diagram) is a more complete situation model than conventional production-consumption models. The IPCW cycle shows that:
Fig. 1: Diagram Key
2.2 Cycles within the IPCW SystemThe IPCW system is complex. Highlighting three sub-cycles in the system makes it easier to understand. 2.2.1 The Production and Consumption CycleCurrent sustainable production and sustainable consumption programs target the production and consumption cycle. As consumers purchase goods and services, they influence what manufacturers create. As manufacturers produce new products and advertise to the public, they attempt to create or shape consumer demand. This cycle can be influenced by actions that influence both consumers and producers, including:
2.2.2 The Investment CycleInvestors supply capital to projects that they believe will give them a good return on their investment. These projects then interact with the production/consumption cycle, and if successful, return profits on the original investment. In the natural capitalism model, natural resources are part of the capital invested in projects. Their associated costs needs to be internalized and their value incorporated into accounting methodologies. As such, reinvesting in natural capital should be a matter of course.9 The investment cycle can be influenced by actions including:
2.2.3 The Waste/By-product CycleIn the waste cycle, natural resources are used in production to make goods (and waste). Goods are then consumed, causing more waste. Conventional consumption and production both generate waste, which leads to an ever-increasing demand for natural resources and an increase in pollution. In contrast, sustainable production and consumption systems produce very little waste. Often they convert some "waste" streams into marketable by-products and reinsert them back into the system. The waste cycle can be influenced by sustainable production and consumption, including:
Most current interventions focus on one of these three cycles in isolation. However, whole-systems thinking suggests that a more unified approach may produce significantly better results. 2.3 Whole-Systems Thinking2.3.1 The Whole-systems ApproachThe two Global Status 2002 reports each call repeatedly for new conceptual schemata to move beyond current approaches. Individually, todays global, national, and local interventions are not producing adequate progress towards sustainability. Interventions are often made without support from a comprehensive whole-systems model, and without sufficiently accurate system metrics for feedback. Whole-systems thinking recognizes that a problem is created by every part of the system in which the problem is embedded, and that the problem can be addressed in any and every part of the system. This approach focuses on interactions between the elements of a system as a way to understand and change the system itself. Whole-systems thinking pays close attention to incentives and feedback loops within a system as ways to change how a system behaves.10 Whole-systems thinkers see wholes instead of parts, interrelationships and patterns, rather than individual things and static snapshots. They seek solutions that simultaneously address multiple problems.11 Respected whole-systems theorist Donella H. Meadows lists nine places to intervene in a system, in increasing order of impact: numbers (subsidies, taxes, standards), material stocks and flows, regulating negative feedback loops, driving positive feedback loops, information flows, the rules of the system (incentives, punishment, constraints), the power of self-organization, the goals of the system, and the mindset or paradigm out of which the goals, rules, and feedback structures arise.12 In Meadows hierarchy, altering numbersadding five percent more money to a program budget, reducing unemployment by half a percentare the least effective form of intervention. Altering mindsetstraditional industrialization leads to prosperity, waste is inevitable, centralized projects mean progressis the most effective form of intervention. Effective change means tinkering with intervention strategies and parts of the system until something works.13 Whole-systems thinking can produce effects that would be unattainable with more linear approaches because it is often a closer fit to the reality of the situation. Two examples, from architecture and agriculture, showcase the benefits of whole-systems approaches. 2.3.2 Green BuildingsGreen building techniques successfully deliver better buildings with lower construction costs, fewer natural resource demands, and lower operating costs by understanding the whole system in which a building operates. Traditionally, when making a decision about how much to invest in energy-efficient building technologies or how fuel-efficient a car should be, we automatically assume incremental levels of savings for our efforts. One should install extra insulation in a house, the reasoning goes, until the cost per extra fraction of an inch of extra thickness is equal, but not more than, the extra savings on the heating bill. While this is common thinking, this reasoning ignores whole-systems thinking. For example, a PG&E demonstration building in Davis, California contains neither a furnace nor an air conditioning system in a climate where summer temperatures sometimes reach 45 Celsius. The creators designed away the need for active temperature control systems by combining improvements in the key components of the houseshell insulation, thermal mass, and internal appliances. Double-thick insulation and super-efficient windows prevent unwanted heat from entering the house; efficient lights and appliances release very little heat inside; and double drywalls create sufficient thermal mass to store coolness through the hottest part of the day. Whole-systems thinking yielded energy savings and passive cooling far in excess of what any single improvement could have achieved on its own. With furnace and air conditioning gone, the need for associated infrastructure such as ductwork, pipes, controls, and wiring were also drastically reduced, creating more space for people inside the building. Beyond the lack of heating and cooling machinery, energy-efficiency measures reduced the energy demands of space conditioning, water heating, lighting, and refrigeration energy by 75% compared to a conventional home. Greater up-front costs for some components of the building quickly paid for themselves with "big savings that were cheaper than little ones."14 2.3.3 Integrated Pest ManagementIntegrated Pest Management (IPM) is an outstandingly successful application of whole-systems, life-cycle-based thinking to a practical problem: controlling (mainly agricultural) pest populations. Although IPM was once a radical departure from the then-standard "spray-and-pray" approach to pest control (i.e., apply pesticides and hope for population reduction), its successes have brought it to the mainstream.15 IPM operates by building a detailed understanding of the system in which pests appear, by:
By applying a system that includes metrics and a life-cycle model, many small, strategic interventions can cumulatively result in excellent pest control. Successful IPM reduces the problem at every stage of its life cycle so that threshold pest populations simply never appear. The individual interventions of an integrated pest management system are ineffective on their own. IPM works because it uses these individual interventions in response to carefully measured feedback from the system it seeks to change. If one intervention is less effective than anticipated, the other interventions in the system are increased in intensity or new interventions are introduced until the system is back on track. While whole-systems thinking does not automatically yield sustainable production and consumption systems, sustainability cannot be achieved in the absence of whole-systems thinking. An environmental health and safety employee charged with enforcing hazardous waste disposal regulations, but otherwise given no authority, will rarely be able to enact innovative and cost-saving ways of eliminating hazardous waste on the front end. An engineer tasked with cooling a building after the architect has drawn the final floor plans will not be able to suggest changes to lighting systems, aspect, or materials that could reduce the size of the HVAC system or eliminate it altogether. The farmer constrained by market demand may not be able to choose to cultivate a variety of crops, remaining chained to a pesticide-dependent monoculture. Action on conventional models of sustainable production and consumption tends to emphasize interventions at the production and consumption stages of the cycle. To be effective, however, interventions must be considered for every stage. The programs outlined below suggest multiple intervention points in the areas of Systems Thinking, Green Design, and Regional Development. 3 Programs that Support Whole-Systems Approaches to Sustainability3.1 Program One: Incorporate systems thinking into UN program design and delivery3.1.1 ObjectivesDevelop capacity within the UN to use whole-systems, integrated problem-solving to design its programs. Develop capacity within the UN to teach these problem-solving techniques to its various clients. 3.1.2 BackgroundFor generations, engineers, scientists, and managers prepared themselves to solve complex problems by becoming increasingly specializedby reducing problems to their constituent parts and focusing their attention on each part. As a result, for instance, architects design a building, mechanical engineers devise its heating system, lighting designers draw up plans for illumination, and interior designers plan the resulting spaces. This separation of design functions and professions often results in inefficient design, construction delays, oversized heating systems, higher costs, and unnecessary environmental impacts.
Whole-systems ideas have specific and practical design and problem-solving applications. For example, Rocky Mountain Institute conducts intensive workshops based on integrated whole-systems thinking. It has used its technique in scores of circumstances for design or redesign of buildings, land parcels, communities, petrochemical plants, food and industrial processing facilities, and even refugee shelters. Results have included attractive, functional, and profitable design, plus significant reductions in energy consumption, cost, waste, environmental impacts, and resource inputs. 3.1.3 Anticipated Outcomes
3.1.4 Program Activities3.1.4.1 Short term
Monitor and study the results of this pilot program. | 3.1.4.2 Medium Term
3.1.4.3 Long Term
3.2 Program Two: Support the Widespread Use of Integrated Economic and Environmental Modeling Tools.3.2.1 ObjectivesFoster the further development of predictive models that promote the understanding of the interactions between the economy and the environment. In particular, focus on simulation tools to support decisions that have large environmental effects: government policy, investment, and product design. Promote research into using computer models to help design, support, and monitor other environmental programs, particularly those that operate together across different levels of the investment, production, consumption, and waste system. 3.2.2 BackgroundComputer simulation of environmental problems supported and informed the strategies that scientists and policymakers developed to combat the erosion of the ozone layer. Such models today encourage political action on greenhouse gas emissions by forecasting the effects of global warming.16 Computer modeling is one essential tool for breaking through what is superficially "known" about systems to understand the dynamics of the system itself. This kind of preconception-challenging approach can improve the quality of mental and social models. It is by changing these models that real change is effected.17 Computer modeling of our economic and environmental systems can demonstrate the benefits and feasibility of sustainable consumption and sustainable production. Accurate and widely accepted models can provide a basis for implementing system-wide changes and can help target programs for maximum effect. Widespread Deployment of Existing Tools The current generation of economic/environmental modeling tools are under-used. Many product designers do not have access to environmental assessment tools, the training to use them properly, or a legislative requirement to produce impact statements. Small and/or poor governments do not have indigenous computer modeling expertise or the resources to develop it, yet must still make decisions about the impact of environmental programs. Targeted Development of the Next Generation of Tools The current generation of simulation tools model a single dimension of complexity each: one tool models macroeconomics and another, new products. There is a need for a new generation of tools that performs simulations like these across domain boundariestools, for example, that can help a product designer see the waste management or capital requirements of his organizations products, or help an economist to make the case for decentralizing the electrical infrastructure of a nation by modeling the economic gains. In particular, there is a need for tools that can model the combined effects of actions at different levels. Most environmental problems are being simultaneously addressed at financial, educational, cultural, and technical levels. Effective modeling tools need to be able to simulate program effects on each of these levels and sum the effects into a picture of the whole system. Tools like these could help design a new generation of environmental intervention programs that focus on multiple levels of action within a single modeling and monitoring framework. An Overview of Current Modeling Programs: Macroeconomic Modeling: Support for Governments and International Agencies The GEM-E3 model, developed by the European Commission, analyzes the macro-economy and its interactions with energy systems and the environment. This system models each nation individually, with data reflecting taxes, consumption, investment, and import/export activity. The model is sufficiently specific to allow fine-grained analyses of policy options and effects.18 For example, this model was used to compute the likely economic impacts of different CO2 emission-reduction strategies in Switzerland. The results indicated the secondary economic benefits of using a domestic carbon tax rather than buying CO2 permits on the international market.19 Industrial Life-Cycle Analysis: Support for companies The "Economic Input-Output Model for Environmental Life Cycle Analysis" by the Carnegie Mellon University Green Design20 combines a variety of U.S. government data on environmental impacts and economic interdependencies. Researchers can use the model to calculate the total cumulative environmental and economic impact of economic activity in some 485 different economic areas, such as "Commercial Fishing" or "Air Freight." For example, the EIOLCA simulation reports that $1 million of spending on "book printing" (one of its 485 economic categories) will release 4.3 million metric tons of CO2. All the different emission sources for each economic category are shown individually, so it is clear that "paper production" and "transport" account for almost half of the emissions in the book printing process. Product Life-Cycle Analysis: Support for Product Designers Product life-cycle analysis tools, such as the SimaPro21 system, help designers understand the impact of their products. SimaPro, for example, maps a product as a set of inputs (such as 0.4 kg injection-molded plastic, 0.1 kg steel, 300w power consumption) that are individually rated for environmental impact using pre-defined assessment tables. The system produces a simple analysis of a proposed design. In this instance, it shows that the major environmental impact of this product will come from its power consumption over the lifetime of the product. 3.2.3 Anticipated Outcomes
3.2.4 Program Activities3.2.4.1 Short term
3.2.4.2 Medium term
3.2.4.3 Long Term
3.3 Program Three: Refine, Standardize, and Consistently Apply Sustainability Metrics to Programmatic Interventions3.3.1 ObjectivesIncrease the efficient and effective use of quantitative program assessment to assist sustainability activities. Require that UN-funded projects estimate their total environmental benefit and measure this against the appropriate metrics. If results vary significantly, investigate. Fully use current metrics where available and, as a secondary goal, create new metrics that can more accurately and succinctly measure sustainability. 3.3.2 BackgroundMeasuring the effect of environmental programs requires data. Quantitative measurements of the relative severity of our environmental impact can help greatly with mitigation efforts, as was evidenced in the highly-effective global action to phase out CFC production. Similar success has been achieved, though far less spectacularly, in the political effects of studies on greenhouse gas emissions. The integrated-systems approach requires that researchers understand the projected outcomes of particular actions and have the ability to measure these projections against the results, so that when the two do not correspond, researchers can determine why, and use this feedback to continually refine the intervention system. This approach requires metrics and data. Researchers and policymakers are at the very earliest stage of this kind of precision in understanding and managing environmental problems. Although there are innumerable sustainability programs, initiatives, proposals, and agendas, the difficulties of assessing the concrete results of any action on the status of the entire system has contributed to the limited success of efforts in the field. Two emerging metrics, one for companies and the other for products, offer new data to help assess program impacts. The Global Reporting Initiative The GRI22 is an important milestone in the journey towards providing accurate, public sustainability data for companies. Though it has reached only an early stage of development, the GRI has widespread support and may well succeed in making sustainable-business information as reliable and available as financial data. The Integrated Product Policy Another promising initiative is the European Union Integrated Product Policy.23 The IPP is a well-designed program with a broad set of goals. It proposes whole-systems interventions in order to increase adoption of green products in the marketplace. One of the IPP initiatives provides life-cycle analysis for a broad spectrum of products. Two promising projects, the External Environmental Effects Related to the Life-Cycle of Products and Services24 and the parallel Information Database on Environmental Aspects of Products And Services25 will provide a large, available, standardized pool of sustainability information about products and the consumption of products. Using GRI, IPP and similar data Though these new sources of data are all in the early stages of adoption, they are an encouraging development that should be supported. As the GRI, IPP, and similar metrics are more widely used, national/international and sector/sub-sector sustainability indices can be computed, giving us a sustainability metrics that are as easy to quote as a nations GNP. In the measurement of metrics, it is important to consider the appropriate use of scale. Aggregate national data from individual countries, for example, rarely reflects the considerable gap between rich and poor that often exists within a nations boundaries, nor does it reflect the wide variations in pollution, resource scarcity, or quality of life. Aggregate national data can therefore lead to misguided policy decisions or might overlook "hot spots" that could best benefit from intervention. It also may lead to less accurate information being included in predictive models.26 In countries where decisions on environmental policy are made at the state, county, province, or town level, national aggregate data may not provide the level of information necessary to make the best decisions. Local data gathering may be less prone to reporting error than when the host nation collects and reports the information.27 By engaging local people in gathering information for metrics (through, for example, Rapid Rural Appraisal techniques), more accurate, finely grained information can be gathered and translated into models and decision-making. Such techniques can also provide more accurate information to feed into predictive models used to map regional, national, and global trends. Future programs (and networks of programs) can set specific targets in terms of the indices computed from this new metric data. In keeping with an emphasis on setting numerical goals for the performance of systems of programs, such indices can be used to review resource allocation and retarget sustainability efforts into areas with the greatest results. The number of programs that can be assessed in this way will grow as more and better data become available. However, there are some situations where an over-emphasis on metrics can be counterproductive, such as:
In these instances, the correct measuring instrument is not a metric, but a wise and experienced human being. The cultivation and training of such individuals is also a goal of this program (see also Program One, section 3.1). 3.3.3 Anticipated Outcomes
3.3.4 Program Activities3.3.4.1 Short Term
3.3.4.2 Medium Term
3.3.4.3 Long Term
Support the consolidation of sustainability metrics as a part of business life 3.4 Program Four: Create Awareness of "Sustainable Investment" Practices as the Necessary Complement of Sustainable Production and Consumption Practices.3.4.1 Objectives
3.4.2 BackgroundSustainable investment is the natural parallel of sustainable consumption and sustainable production. The precise definition of sustainable investment may take years to establish, considering that both sustainable production and sustainable consumption are still being defined. However, the eventual definition of sustainable investment should certainly include multiple-bottom-line reporting, environmental impact analyses of investment portfolios, and the development of concepts like zero-emissions capital management. A UNEP DTIE Sustainable Investment program would not replicate efforts already being made by the UNEP Financial Initiatives program, or by initiatives such as the GRI. Rather, the SI program would focus on applying work from these initiatives to support existing Sustainable Production and Sustainable Consumption Programs. An SI program would work to form a three-way partnership between investment, production, and consumption approaches to sustainability. It would help connect the financial world with the needs of Sustainable Production and Sustainable Consumption Programs and attempt to build awareness of such issues in the investment sector. 3.4.3 Anticipated Outcomes
3.4.4 Program Activities3.4.4.1 Short Term
3.4.4.2 Medium Term
3.4.4.3 Long Term
4 Programs that Promote Green Design and Infrastructure4.1 Program Five: Build the Global Capacity of Online Resources in Green Design4.1.1 ObjectivesSupport and develop easily accessible sources of information on green design. Develop frameworks that are interactive and practically useful to the non-technical green-design practitioner. 4.1.2 BackgroundA growing number of companies are seeking to design products and processes that are non-toxic in their manufacture and use; use a minimum of materials and energy; and are part of a system that enhances rather than depletes the earth. McDunough-Braungart green chemistry principles, the principles of natural capitalism, and the guidelines for biomimicry (see sidebar) all offer whole-system design frameworks for the creation of cleaner, less polluting products and production systems in all types in all industries.
The reason for these gaps is not so much a lack of information, but a lack of access to information. What is needed is a library that bridges this language chasm and makes literature and solutions based on the principles of natural systems accessible to designers and engineers. An open library of designs for refrigerators, lighting, heating, cooling, motors, and other systems will encourage manufacturers, particularly in the developing world, to leapfrog directly to the most sustainable technologies, which are much cheaper in the long run. Manufacturers will be encouraged to use the efficient designs because they are free, while inefficient designs still have to be paid for. The library could also include green chemistry and biological solutions to industry challenges, for example enzymatic reactions that could be used in place of energy, and chemical-intensive processes or nontoxic paint pigments for cars and buildings. This library should be free of all intellectual property restrictions and open for use by any manufacturer, in any nation, without charge. 4.1.3 Anticipated Outcomes
4.1.4 Activities4.1.4.1 Short Term
4.1.4.2 Medium Term
4.1.4.3 Long Term
4.2 Program Six: Green Designs and Retrofits for UN Buildings4.2.1 ObjectivesDemonstrate the benefits of green building design and energy-efficient end-use equipment to citizens, policymakers, and the construction industry through green retrofits of existing UN buildings and green construction of new UN buildings. Increase the rate of diffusion of green technologies. Reduce UN costs and environmental impacts. Provide a healthy working environment for UN personnel. 4.2.2 BackgroundShowcasing innovative green technologies in high-visibility UN buildings encourages awareness and adoption of these innovations on a broader scale. Research in the area of innovation-diffusion demonstrates that more people adopt innovations faster if they are innovations that they can observe, obsere, and test before committing themselves to, and that have a perceivable relative advantage over existing technologies.29 By giving citizens a chance to see, test, and notice the advantages of a UN green building, the UN can help to accelerate adoption of such ideas throughout society. The Many Benefits of Green Building: From reflective roofs, CFLs, and super-efficient windows to flexible access floors, personal comfort controls, and photovoltaics, a wealth of new technologies is adding function, value, and high performance to todays buildings. Well-designed green buildings often cost no more to build than the alternatives (if not less) because resource-efficient strategies allow for the downsizing of more costly mechanical, electrical, and structural systems. Green buildings save money throughout their life cycle. They are energy efficient, saving from 20 to 50% of energy costs through integrated planning, site orientation, energy-saving technologies, on-site renewable energy-producing technologies, light-reflective materials, natural daylight and ventilation, and downsized HVAC and other equipment. A raft of other resource- and money-saving devices that continue to pay throughout the buildings life cycle includes: natural landscaping, water-saving equipment, low-maintenance materials, salvaged construction debris, and smart building controls. Green buildings generally provide higher-quality work environments, principally because of daylighting and the lack of off-gassing from toxic building materials. This, in turn, generally translates to greater employee job satisfaction and higher work productivity. Eight documented case studies show that productivity gains from green design can be as high as 16 percent.30 Short-term Results: While building green from day one offers best chances for maximum efficiency and breakthrough levels of energy savings, retrofits can also yield excellent results. Installing daylighting and energy efficiency measures in one California office building yielded 75% energy savings and a 45% reduction in worker absenteeism.31 Analysis of a green retrofit of a 20-year-old Chicago building already in need of remodeling revealed that changing the renovation design to a whole-systems approach could dramatically improve comfort, quadruple energy efficiency, and cost about the same as normal renovations.32 Simply screwing in compact florescent lamps saves 75 to 80% of the electricity used by an incandescent bulb; reduces the labor of replacing them because they last 8 to 13 times longer; and places less of a load on a building's cooling system because of no heat from incandescent bulbs.33 4.2.3 Anticipated Outcomes
4.2.4 Program Activities4.2.4.1 Short Term
4.2.4.2 Medium Term
4.2.4.3 Long Term
4.3 Program Seven: Encourage Adoption of "Decentralized Infrastructure"4.3.1 ObjectiveTo encourage the adoption of "Decentralized Infrastructure" (defined below) to reduce or remove the need for costly and resource- and capital-inefficient centralized infrastructure. This program involves a mix of prototyping, education, investment, and public relations. 4.3.2 BackgroundCentralized infrastructure such as power stations often require extremely large capital investments and many years to build. In many cases these same services can be provided via a mixture of demand-reducing end-use efficiency (such as insulation and efficient appliances) and local, small-scale resource provisioning (for example, solar panels). The resulting avoided cost represents a crucial but widely unrecognized source of capital, particularly for the developing world. As an example, the manufacture of end-use, energy-saving technologies such as compact-florescent lamps (CFL) or super-efficient windows takes around a thousand times less capital than expanding the electricity supply. Furthermore, capital from demand reduction is returned ten times faster than it would be for building new electrical infrastructure. Combined with the lower capital requirements, a CFL plant is 10,000 times more efficient than expanded infrastructure.36 By reducing demand, power stations and other forms of infrastructure can be built smaller, closer to the end-user, or eliminated entirely. Shifting to a demand-reduction model can provide people with services they want and need in a manner that consumes fewer resources, is flexible and sustainable, and costs less. Historically, providing power and water to large and rapidly growing populations often necessitates huge development projects. These can be expensive, requiring money from multinational lending institutions; can generate tremendous environmental damage and displacement of people; can under-perform expectations; and, by the nature of their size, are inflexible to changes in demand. While the generation of much-needed jobs is often an attractive feature of such projects, in the long run they may be less sustainable than smaller, more efficient, flexible, and regionally appropriate modes of delivering the same services. Two terms, "decentralized" and "distributed," are used (roughly) interchangeably to describe this form of infrastructure. The case for distributed electricity infrastructure is exhaustively demonstrated in Small Is Profitable by A.B. Lovins, et al.37 Decentralized infrastructure in developed countries Developed countries can also leverage the benefits of distributed generation as a flexible, cost-effective alternative to replacing aging, centralized energy infrastructures. By reducing overall energy consumption, and thus reducing demand at "the end of the pipe" the distributed generation system mitigates the need to build new energy capacity. In situations that demand a reliable, uninterrupted supply of energy or water, such as data centers or hospitals, decentralizing and distributing the source of both improves source security, reduces the chance of interruption, and allows for better control over locally appropriate efficiency measures. Decentralized Infrastructure Housing Housing construction often requires six different kinds of centralized infrastructure (potable water, wastewater treatment, stormwater management, electricity, gas, and communications) before construction can start. These costs are often externalized; that is, they are not included in the prices of the residences. In contrast, Decentralized Infrastructure Housing (DIH) provides all of these essential services, using such features as energy efficiency, photovoltaic generation, composting toilets, and a raft of other emerging sustainable technologies. Obstacles Because Decentralized Infrastructure Housing actually looks very different from conventional housing, adoption is problematicdespite the fact that actual quality of life for residents may be higher and total-systems development costs significantly lower. Likewise, large, centralized development projects that supply energy and water often represent an enormous sunk capital cost that makes energy and water cheap to the end-user. In such cases, incentives to reduce energy consumption may be extremely low for government, utilities, and the individual citizen. Intervention, then, must happen at both the building level, and at the level of planning how infrastructure services are provided in the first place. 4.3.3 Activities4.3.3.1 Short term
4.3.3.2 Medium term
4.3.3.3 Long term
5 Regional Development Programs5.1 Program Eight: Establish a coalition of developed and developing island nation-states to foster energy independence and incubation of pioneer hydrogen economies.405.1.1 ObjectivesPromote the development of self-sufficient, sustainable energy infrastructures for developing and developed island nation-states. Create an international network for the exchange of decentralized sustainable energy ideas, technological expertise, innovation, enterprise incubation, and strategies to between all island nation-states - big and small, developing and developed. Address unique economic, environmental, and security needs of island-states through cutting edge strategies and technologies such as energy efficiency, distributed generation, and alternative energy, with a particular attention to hydrogen. Use activities as an opportunity to incubate and "jump start" transitions to sustainable energy sources and the hydrogen economy that will in the future benefit "late adopter" non-island nations as well. 5.1.2 BackgroundIsland nation-states have a particular stake in developing an autonomous energy structure. Fossil fuels, particularly oil, generally have to be imported from long distances. This can pose both a security risk and an unwanted expense. Eighty-eight percent of Hawaiis energy is currently produced from oil. In 2000, Iceland spent $185 million on oil imports. By 2005, it is predicted that 92 percent of oil imports to the Asia-Pacific region will come from the Middle East. Political volatility, trade disagreements, threats to traditional shipping routes, price fluctuationsall pose potential threats to fossil-fuel dependent economies in general and island nation-states in particular.41 Climate change, with the risks of rising seas, increased flooding, and volatile weather patterns, poses more immediate dangers to islands than to landlocked nations. Smaller developing island nation-states already have networks for examining sustainability issues, including energy, through the UN-supported Small Island Developing States Network (SIDS).42 Combining the focused efforts of developed and developing island nations of all sizes towards the achievement of self-sufficient, renewable energy infrastructures is a logical next step. In particular, island nation-states with growing economies are uniquely suited to the benefits of hydrogen-generated energy. Unlike imported oil, hydrogen can be produced locally from a flexible range of energy sources. Hydrogen produced from renewable fuel sources offers a means for both weaning the world from its fossil fuel habit and slowing global warming. Hawaii, Singapore, Japan, and Iceland have already invested considerable time and resources into moving towards sustainable energy including the development of a hydrogen economy. Sixty-seven percent of Iceland's energy already comes from emissions-free geothermal heat and hydroelectric dams; this could provide a carbon-free energy source for hydrogen production.43 By pooling their intellectual capital, a diverse body of island nations could share and capitalize on technology developments, best practices, and innovative indigenous knowledge.44 Developed island nations who are already creating new energy technologies could foster the development of demand for such products from their developing island partners, thus creating additional market pull for an emerging industry. By placing themselves on the cutting edge of energy sustainability, island-states could achieve competitive advantage and early market penetration in a field that will become more lucrative when non-island states join in later, thus providing the leaders with a boost to their national economies. Beyond eliminating economic and environmental liabilities, shifting to hydrogen could create an additional competitive industry for early adopters. Hawaii is examining the possibility of tapping into its abundant geothermal, wind, and solar energy reserves to become an exporter of energyshipping hydrogen around the Pacific to energy-hungry nations. One of the later phases of Icelands sophisticated hydrogen transition plan involves the export of hydrogen to Europe.45 By recognizing the threats of continued dependence on fossil fuel to their own survival, and seizing the opportunities to be had by switching to cleaner, decentralized hydrogen, island economies may lead the way technologically and politically for the rest of the world, acting as early adopters and catalysts for transition to sustainable energy infrastructures on a global scale. 5.1.3 Anticipated OutcomesIncreased sustainability and security for member island nation-states due to self-sufficiency of energy. Accelerated development of technologies and strategies that support energy self-sufficiency, distributed generation of energy, and alternative energies, including hydrogen fuel cells. Creation of new export opportunities for member nations in the form of cutting edge energy technology, carbon trading, and the sale of green energy to other nations. Increased flow of ideas and technical support on energy matters between developed and developing island nations, to the mutual benefit of both. 5.1.4 Program Activities5.1.4.1 Short term
5.1.4.2 Medium term
5.1.4.3 Long term
5.2 Program Nine: "Leapfrog" new environmental regulations past outdated command and control models to integrated, flexible ones.5.2.1 Objectives:Encourage the development of international-, national- and regional-level environmental regulations that are flexible, innovation-friendly, and rigorous. Examine means of encouraging sustainable production practices via the standards, guidelines, and regulations of international trade organizations in ways that are equitable and do not interfere unreasonably with the efficient flow of free trade. 5.2.2 BackgroundUnited States environmental regulationmostly crafted in the 1970swas command-and-control focused. It was also fragmented into control of pollution by media (e.g., the Clean Air Act, the Clean Water Act, the Resource Conservation and Recovery Act); and focused upon implementation of government-designated best available technology (BAT). While such regulation served its purpose at the time, it no longer represents the best model for governments to encourage sustainable practices. Developing countries without existing regulatory models should certainly not look to current US models for guidance. Rapid innovations in technology, increasing globalization, and changing scientific data require that the environmental regulation of the future must look drastically different if we are to achieve radically improved sustainability. Historically, European countries have cultivated more creative regulation designed in collaboration with industry. European states have been more willing to enact regulations that place end-of-life responsibility for products with corporations. But even Europe needs to join an accelerated global adoption of integrated regulations that push for more and more sustainable methods of production and consumption, rather than merely complying with the status quo. In his Harvard Business Review article "Green and Competitive: Ending the Stalemate," Michael Porter provides guidelines for creating innovation-friendly regulations (see sidebar)47. While there is no universal design model for regional environmental regulation, this provides some useful landmarks in crafting legislation. The WTO On a global scale, change at the level of trade organizations could also be highly beneficial. Currently, the World Trade Organization allows its member nations to bar free trade from other nations based upon the quality of the end product in question, but does not allow the process by which a good is produced to affect its tradability status.48 But increasingly, it is evident that processes can negatively affect the quality of an end product particularly foodin unanticipated ways. There is also considerable evidence that the processes themselves can have adverse effects with global impact. For example, conventionally grown cotton accounts for a large percentage of pesticide use on the planet; trade guidelines supporting organic cotton could provide a significant global leverage point to alleviating related problems of water pollution and health problems. To the extent that production practices threaten to impair ecosystem services and agricultural productivity, sustainable processes can contribute positively to the continued, long-term health and prosperity of international trade. An unintended consequence of current WTO regulation is the protection of externalization of ecological costs associated with product production by barring the consideration of those costs in assessing import tariffs. Efforts to objectively identify reasonable process criteria to regulate trade on goods should be accelerated. Specific processes that offer the greatest potential for positive global impact on the environment should be identified and prioritized as recommendations to the trade organizations. While there is perhaps legitimate concern that such criteria could be imposed as a disguised trade barrier to benefit an international trade organization member, this concern exists in all trade regulations and must be successfully balanced against the benefits of allowing nations to control their imports. 5.2.3 Anticipated Outcomes:
5.2.4 Program Activities:5.2.4.1 Short term
5.2.4.2 Medium term
5.2.4.3 Long term
5.3 Program Ten: Develop initiatives in China to assist in development of sustainable enterprises and the training of sustainability leaders.5.3.1 ObjectivesSupport China's development of sustainable production and consumption practices. Encourage "leapfrogging" ahead of outdated, polluting methods of production and consumption to cutting-edge technologies and practices that offer both greater sustainability and opportunities for global market competitiveness. 5.3.2 BackgroundWith one-fifth of the world's population within its borders, China presents serious environmental challenges and, at the same time, a key leverage point in the promotion of sustainable consumption and production. China contains nine of the top ten most polluted cities on the planet.50 China mines and burns a billion tons of coal a yeara quarter of the worlds supply. Three-quarters of the countrys energy needs are met by coal.51 Though China currently trails the United States in overall greenhouse gas emissions, current trends suggest that they will hold the number one position by 2020. Although the ecological pressures are daunting, the opportunities are enormous as well. Energy intensity in the Chinese economy has been steadily decreasing, owing to investment in energy efficiency and improved technology;52 recent research concluded that a shift in rice cultivation practices has drastically reduced China's methane emissions for the past two decades.53 In anticipation of the 2008 Olympics, the central government has pledged to reduce coal consumption in Beijing by one half and to eliminate the problem of dust storms in the city. Studies indicate that switching from coal to natural gas in China would likely reduce total industrial carbon output by as much as fifty percent. A shift from coal to natural gas would both reduce carbon output and address the significant air quality problems that plague China's urban areas.54 In support of China's ongoing efforts to move towards sustainability, the international community should look for opportunities to support and encourage national leadership and both private and state enterprises in adoption of whole-systems sustainability practices in China. For these reasons, we recommend aggressive efforts to include China in many of the activities outlined in other programs presented in this document. In particular, China's need for jobs, large rural population, and rapidly industrializing economy all make it an excellent candidate for "leapfrogging" technologies. Growing a cutting-edge infrastructure that features hydrogen generation, radically increased resource efficiency, and flexible, decentralized energy will benefit China and the planet financially and environmentally.55 Conversely, trying to raise the standard of living for 1.4 billion people using 1920s Pittsburgh-style coal-based energy systems and business-as-usual industrial practices would be disastrous not only for China but for all global communities as well.
One danger in incubating these manufacturing processes in China and other developing countries has already surfaced in early projects currently online. Manufactured sustainability products (such as, for example, PV panels sold in Kenya) often vary drastically in quality56, frustrating the user, impeding technology diffusion, and hindering the "leapfrog" effect. A considerable investment of income is lost when a product with poor quality control under-performs or breaks down quickly. Efforts to encourage the enterprises manufacturing green products in countries like China should continue, but attention must be paid to ensuring high quality and proper implementation via technical support and quality-monitoring guidelines. Sustainable production enterprises also should be decentralized where practicable in order to help stabilize communities stressed by high unemployment. In some parts of India, for example, fabric parts for jeans are sold and assembled by local tailors, reducing cost and providing local industry and jobs.57 5.3.3 Anticipated Outcomes
5.3.4 ActivitiesCreate multiple programs and initiatives in China, some new, some incorporated into existing development projects. Apply programs 5, 6, and aspects of 8 to China. 5.3.4.1 Short term
5.3.4.2 Medium term
5.3.4.3 Long term
6 ConclusionIt is easy enough to speak in terms of discarding linear thinking, seeing the system as a whole, identifying leverage points, intervening effectively, and measuring accurately. It is an entirely different matter to implement such behavior on the ground. The suggestions in this paper offer ideas for achieving the goals of more sustainable production and consumption systems. The integration of agencies, shifting of mindsets, and leveraging of funds necessary to make these goals a reality are obviously difficult. We have not addressed some of the most obvious and urgent places to intervenepopulation, for instance because they are outside of Rocky Mountain Institutes areas of expertise. The recommendations we have made emphasize the power of information, opportunities for drastic increases in resource efficiency in buildings and infrastructure, and the need for integrated interventions. Some of the short-term ideas, such as compact florescent light bulb retrofits in UN buildings, may offer gratifying immediate payback. Many other proposed ideas will require a broader understanding of sustainability and inter-agency coordination to implement. All our suggestions stem from the axiom that the whole is greater than the sum of its parts. Our recommendations can be summarized as follows: understand the investment, production, consumption, and waste cycles in which any environmental problem is embedded; target interventions at multiple points in the cycle, measure the impact of these interventions; and adjust further interventions accordingly. The promise of transformation through whole systems thinking has been demonstrated on a small scale in agriculture and green building design. It is now imperative that we realize its potential on a global scale.
7 Endnotes
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