More value creation, less waste

Per Espen Stoknes

How can we build a better world for the time after COVID-19?

A burger made from beef provides around 500 calories. Producing it requires around 10 000 calories and around 2.5 kg of CO2-emissions. The production of a plant-based burger with similar nutritional content requires only about 1000 calories and 0.2 kg of CO2-emissions.

We discard about 90 percent of resources after using them once. Many believe that we have efficient technologies that reduce waste. If you take a closer systematic look, however, you will find that many value chains are highly inefficient.

For Norway, green growth means that we have to cut waste in key sectors including food production, construction, mobility, petroleum production and industrial production. Studies from the UN panels on climate change and nature tell us where we have to be in 10 and 20 years in order to reduce global warming. We may not know exactly how to get there, but we know enough to set ourselves some big hairy goals for 2030.

We can aim to be self-sufficient when it comes to animal feed, both onshore and offshore. Zero imports of soy from rainforest countries. We can aim to double the volume of sustainably produced farmed fish. We can aim to begin construction of 100 climate neutral long distance ships. We can aim to produce 50-100 TWh offshore wind power for export, or to save 15 TWh in energy consumption from buildings.

In a crisis like the current one, compensating laid off workers is not enough. It creates an expectation that we will return to pre-corona normalcy. That reality may no longer exist. All the suggestions above will immediately create jobs and help us return to a better world as the crisis passes.

How to achieve big hairy goals?

If we are to succeed, we must make waste more expensive. It has been difficult to implement taxes on resource consumption (so-called green taxes), whether on new plastic packaging, forestry, mining or fish farming areas in the fjords. The companies subject to the taxes always protest loudly, and the benefits of introducing green taxes do not always get as much media coverage.

Green taxes should not increase total taxation. We can reduce employer tax and income taxes by an amount corresponding to the increase in resource tax. This would benefit more people than are affected by taxation on resources. Net income would increase, while employers could hire more people without increasing total payroll expenses.

Transitioning must be profitable. The key is not only green taxes, but rather a combination of instruments. If we could combine targeted economic stimulus with green taxes and a reduced tax on labor, it would give incentives to transition. For example, the state could require or incentivize reuse of construction materials, and increase taxation on for example concrete and steel.

We also know that the EU will introduce more stringent recycling requirements. We can prepare for these by requiring that businesses already today design products to make recycling profitable. Governments should also ensure that they buy recyclable products through public procurement.

A combination of targeted stimulus, green taxes, responsible production and requiring recyclable products for public procurement will enable lasting change. It will create jobs, increase value creation and ensure reuse of materials. Finally, the 21st century economy may begin to take shape.

Published 27. April 2020

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