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Speech by Achim Steiner at the University of Auckland,"Are We Glimpsing the Emergence of Green Global Economy"

Auckland, 4 June 2008-Vice chancellor of Auckland University, Stuart McCutcheon; distinguished delegates; students; winners of the Bayer-sponsored Eco Minds awards; colleagues, dear friends,

May I say how delighted I am to be in New Zealand and to be here at the University of Auckland-a beacon of academic research, teaching and inspiration to young and enquiring minds dating back 125 years.

I and my colleagues from UNEP are in New Zealand as this is the main host of global activities and celebrations under the umbrella of World Environment Day 2008.

Last year Norway was the main host under the theme Melting Ice: A Hot Topic-By the end of WED close to 100 countries had taken part and we were able to remove the question mark.

It is a hot topic.

The theme this year is 'Kick the C02 Habit"-a theme reflecting the urgency of moving from the science and the threats to action and to the catalyzing of grass roots around the world.

In 2007 we had extraordinary momentum, driven by the reports of the Intergovernmental Panel on Climate Change-established by UNEP and the World Meteorological Organisation-which led to the dramatic agreements at the climate change convention later in the year.

If we are to maintain that same level of attention on climate change in 2008 and 2009 we need the public, communities, cities and the private sector to empower governments to act.

It was a point underlined earlier in the year by UN Secretary-General Ban Ki-Moon who has put climate change among his key priorities for the UN as a whole.

Ladies and gentlemen,

In my address to you today I would like to suggest that 'Kicking the C02 Habit" is underway and that we indeed are 'Glimpsing the emergence of a Green Economy 'almost everywhere.

For example according to financiers under the UNEP Sustainable Energy Finance Initiative total transactions in the renewable energy market in 2007 touched nearly $160 billion, up from $100 billion in 2006.

The emergence off a Green Stock Exchange in New York for trading carbon, backed by such big names as Merrill Lynch and JP Morgan, shows that the United States is gearing up.

Research and development laboratories are bringing human ingenuity to bear on new, energy saving devices.

For example some are looking at how the human body makes bone at 37 degrees C as a substitute process for the way cement is manufactured at 1,200 degrees C.

Entrepreneurs are increasingly investing in tropical forests in the hard nosed belief that these will be given funding or brought into the UN's formal climate markets as a result of their natural carbon storage potential.

But I would also suggest that this transformation is far from guaranteed especially given the state of negotiations under the climate convention treaty-under the Bali Road Map- as they stand today.

Some countries are forging ahead, but others are idling in neutral and some seem to have found reverse with just 18 months to go to the critical climate convention meeting in Copenhagen in late 2009.

However, I would also like to propose that if we can embed the word Green into the economy this we will not only be going a long way towards kicking climate change into touch.

We may also be kicking quite a lot of other persistent and emerging environmental and economic crises into touch too.

And inspiring action on the broad sustainability agenda.

From not only forest conservation and better management of heavy metals but also to addressing acidification of forests in Asia, acidification of oceans and seas globally and levels of air pollution that are poisoning and killing millions annually.

Ladies and gentlemen,

This University was born in a world where coal and steam were the engines of the global economy

And they, along with oil and latterly gas have been fueling our homes and our factories and our cars and ships and planes ever since.

But the world of the 21st century is pushing the limits-if not pushing past the limits-of what a planet can take when fueled nearly exclusively by fossil fuels and a management of nature-based resource that is far too predatory and extractive in its orientation.

Indeed climate change has brought in to sharp focus an economic development path trapped in a myth.

The myth that the planet's nature-based resources and natural systems including the atmosphere are somehow external to our economic and human well being.

Energy is perhaps the most poignant reminder that in some ways human-kind has hardly got beyond first base in its evolution.

The fact is that despite enormous advances in medicine to electronics we are living in a 21st century powered largely by digging up, or sucking up, fossilized woods and organisms and then burning them.

In many developing countries the inability of the market to supply energy means many are simply forced to get 'fresh carbon' by cutting down trees with wide-ranging and direct consequences.

In Kenya, the big Masinga Dam has lost one third of its capacity to siltation as a result of deforestation.

The Mau Forests Escarpment, the source of water for the capital of Nairobi, for the famous flamingo attraction of Lake Nakuru and the Masa Mara, is also under threat after losing more than 7,000 hecatres of forest.

A cave man or women might marvel at satellite TV or the unraveling of the human genome but would feel completely at home in many parts of the world with the fuels we currently use.

But ladies and gentlemen,

climate change is part of a wider management crisis and challenge. Never, in the entire history of humanity have we reached a stage when Homo sapiens had the power to fundamentally alter entire natural systems until now.

That's the gloomy part. But there is also a silver lining.

Climate change is so challenging, so threatening and so inclusive in terms of the impacts on countries and communities that it provides a unique focus for collective and multilateral action.

Indeed intelligently managed, climate change could prove to be a truly transformational force-one able to revolutionize resource efficiency and trigger new kinds of low, even zero emission technologies; businesses and employment opportunities.

Combating climate change is also triggering dialogue and action on the wider sustainability agenda.

Governments and corporations to cities and citizens are evolving new mindsets that are starting to grasp that what we once thought of as free or without value-the atmosphere; the tropical forests and the soils of planet Earth-are indeed worth trillions upon trillions of dollars.

Some are also trying to capture that value of nature; the losses as a result of degradation and the huge returns possible if society's re-invest and conserve these nature-based assets.

Nicholas Stern, on behalf of the UK Treasury, and the IPCC have put figures on the table in terms of climate change.

Last week in Bonn, where the Convention on Biological Diversity (CBD) held its intergovernmental meeting, 'Stern-like' findings were presented too.

The report, commissioned by the European Union by a team led by Pavan Sukhdev of Deutsche Bank, estimates that environmental degradation including the losses of species costs between $2 trillion and close to $5 trillion annually.

In China, environmental degradation in 2004 was estimated to be costing its economy $66 billion or 3.5 per cent of GDP.

China is reviewing the question of environmentally adjusted GDP which has triggered some debate. But at least China has had the courage to face the issue. How many other countries have tried to calculate environmental losses in respect to GDP?

Ladies and gentlemen,

I began by saying how pleased I was to be in New Zealand again. It is my second time here but my first as Executive Director of UNEP and my first for World Environment Day.

Ladies and gentlemen there is no country that can say they have kicked the C02 habit or are even close to doing this.

But what is exciting is that some economies are starting to try and New Zealand is among those.

I know that you have a general election in only six months time and so, as a UN Under-Secretary General, I must choose my words carefully!!

One can easily be misunderstood and perhaps seen to be favouring one party or set of policies over another.

But under this government, and under previous administrations, New Zealand can be proud of many of its achievements and forward-looking plans under the banner of a Green Economy.

At the CBD in Bonn there were many issues on the table including protected areas.

Protected areas on land have emerged as a success story with over 12 per cent of the terrestrial surface listed at various levels of protection with many of the parks in the last few decades emerging in developing countries.

The OECD's new Environmental Outlook to 2030 points to the need to strengthen the protected area network in the face of increased demand for food-the OECD estimates that even with more sustainable agricultural policies, around 10 per cent more land is likely to be needed for crops and feed stocks.

Managed sensibly, protected areas can assist in conserving biodiversity and in generating revenues for countries and communities via tourism and the maintenance of healthy ecosystems.

There is however an urgent need to step up the listing not least for marine protected areas which still only account for 0.5 per cent of the oceans and seas.

New Zealand, with 32 per cent of the land held in protected areas, should be proud of its achievements but doubly proud in respect to marine-New Zealand has 7.5 per cent of its territorial waters under protection according to the OECD.

Yesterday I saw at first hand the successes and also the challenges facing those managing a marine protected area here when I attended the launch of the Hauraki Gulf, State of the Environment Report launch.

Meanwhile in February New Zealand became one of five economies to found UNEP's Climate Neutral Network(CN Net). The others were Costa Rica, Iceland, Norway and Monaco.

All relatively small economies but all so interesting as they face common but unique challenges and thus in a sense are countries able to show leadership by piloting fresh and creative ideas from which others can learn.

For Norway it is oil and gas production.

Iceland's electricity is 99 per cent geothermal, but it has huge challenges from transport including emissions from SUVs and from the fishing industry.

The country has plans for the wide deployment of fuels cells for its fleet.

Monaco is perhaps challenged by how to green the life styles and consumer habits of the super rich.

For New Zealand, where 50 per cent of emissions are from agriculture, it is livestock that dominates.

I have read the debates that have been playing out in New Zealand in recent weeks with animated debate over the role and responsibility of big emitters; transport and agricultural emissions.

They mirror debates in countries all over the world.

Costa Rica, a developing country, aims to achieve climate neutrality by its 200th anniversary of independence including through forestry but also via tackling consumption and production patterns.

Its environment minister, Roberto Dobles, has said that Costa Rica is not part of the climate change problem but "it will be part of the solution" and has made it clear that economies that show leadership on the Green Economy will be the prosperous economies of the 21st century.

Others are taking a similar view. In Germany it is estimated that more people will be employed in environmental sectors by 2020 than in its famous car industry.

Germany, once nowhere in renewable energy, has become number one in wind power.

Not by huge hand outs or massive subsidies, but by a simple change in the law requiring utilities to buy in a certain percentage of green power.

Several cities such as host of the next winter Olympics, Vancouver have also joined the CN Net along with companies such as Singapore's largest power generator to a Brazilian based multinational natural cosmetics company.

I would like to applaud the close to a dozen companies here in New Zealand who, today in Wellington will announce they are participating too.

There will always be those who will criticize an initiative like the CN Net on the grounds that it is voluntary.

That it allows participants to 'greenwash' rather than Green their Economy.

But I would have to disagree-not least because it is often the same ones who criticize voluntary initiatives that are the same ones who attack legally binding environmental treaties.

Sometimes on the grounds that they are strangling industry in red tape or are plots by environmentalists to take over the world!

I think critics are sometimes just people or institutions who do not like change, or even fear change, whatever direction it comes from because it may challenge their comfort zones.

But I would emphasize that the biggest challenge to all our comfort zones comes from climate change, unaddressed and unchecked.

Ladies and gentlemen,

the point of the CN Net is that often a problem shared is a problem halved.

The path to low carbon and climate neutral future may seem daunting for some.

But can be transformed by advice and the experiences of others-just look at how quickly compact fluorescent light bulb has taken off in the past 12 months or so once the word got around.

Overnight, a ubiquitous two hundred year-old inefficient technology is finally facing retirement-why it took so long raises a lot of issues too.

Issues of vested interest and of conventional thinking and conservative investment patterns- and of companies and countries staunchly defending the status quo.

Defending the status quo because they have neither the inclination nor the intellect to face up to the peer reviewed science, see the way the wind is blowing and to adapt to a new reality and rapidly changing business landscape.

So instead they keep huffing and puffing and trying to blow back the wind rather like King Canute with the waves.

Perhaps with the CN Net was can save their breath and demonstrate the art of the possible to an ever wider audience and in doing so support the achievement of a new and decisive climate agreement in Copenhagen.

Ladies and gentlemen,

voluntary initiatives have their place but are given meaning and purpose if they support legally binding treaties, transformed into national legislation.

This is why we have the United Nations Framework on Climate Change(UNFCCC), established in Rio in 1992 and its emission reduction Protocol, the Kyoto Protocol, signed in 1997.

That is why UNEP and so many others are working tirelessly towards Copenhagen.

Here a new, deep, decisive and meaningful climate treaty must be agreed so as to become operational by 2012-2013 if the Green Economy is to have legs.

The United Nations is not alone-the Green Economy itself is pressing for a new deal too.

Let me introduce you to some of these Green Economy people and players, many of whom are partnering with or partners to UNEP.

- The Principles for Responsible Investment, facilitated by UNEP's Finance Initiative and the Global Compact in 2006, now has 300 financial institutions on board, with assets of $13 trillion.

- UNEP's Sustainable Energy Finance Initiative (SEFI) is emerging as a thriving network of financiers. SEFI's report last year underlined how capital is mobilizing towards these low-carbon sectors, with total transactions surpassing the $100 billion milestone in 2006 and reaching nearly $160 billion in 2007.

- In collaboration with the United Nations Foundation and Shell Foundation, UNEP has helped two of India's largest banking groups-Canara Bank and Syndicate Bank-create a credit market for helping rural villages finance the purchase of solar lighting systems.

- 100,000 people in southern India have benefited and the initiative is now self-financing, with some 20 banks involved.

- In Tunisia a similar initiative has created a credit market for bank financing of solar hot water systems. Over 20,000 systems have been financed, increasing annual market volume more than 700 per cent since 2004.

- The positive results have led the Tunisian government to enact legislation aimed at decreasing the country's reliance on using Liquid Petroleum Gas for water heating by instead helping homeowners make the shift to solar.

- UNEP and partners such as UNDP and the World Bank are also building the capacity of some 30 developing countries to access the carbon markets for financing climate-friendly infrastructure.

- These multi-million dollar initiatives, including ones under the Nairobi Framework, fall under the umbrella of the CD4CDM programme (capacity building for the Clean Development Mechanism)-the largest initiative of its kind.

There are other ways to address the constraints and risks of a renewables revolution. The geothermal electricity potential in Africa is estimated at 7,000 megawatts.

- With funding from the Global Environment Facility(GEF), UNEP and the World Bank are just about to launch the African Rift Geothermal Facility(ARGeo). The $17 million project will underwrite the risks of drilling for steam and in doing so build the confidence of the private sector to build geothermal power stations from countries such as Kenya up to Djibouti.

- UNEP/GEF's Solar and Wind Resource Assessment Partnerships have 'found' 10 million megawatts of solar and wind energy in 26 developing countries in Asia, Africa and Latin America, thereby facilitating public and private sector development.

- With $20 million in GEF and UN Foundation support, UNEP is also working with the Asian and African Development Banks to leverage private sector financial flows towards clean energy entrepreneurs. Over 50 entrepreneurial businesses specializing in clean energy technologies and services have been financed to date in Africa, Brazil and China.

- We are working to boost energy efficiency in a sector using 40 per cent of the world's energy and generating a third of the global greenhouse gas emissions-I refer to UNEP's Sustainable Buildings and Construction Initiative.

- We are also developing, in partnership with the insurance sector, new weather derivatives and other instruments that help renewable energy developers to manage project risks such as low wind speeds and uncertain biomass fuel supply.

- In 2007, UNEP was also invited to join the board of the Corporate Sustainability Index of BOVESPA-the Brazilian stock exchange which, along with South Africa, is championing environment, social and governance issues in developing world markets.

- Carbon markets are also expanding including the Chicago Climate Exchange and the Asia Carbon Market in Singapore.

These examples, among hundreds of others are vital proof that investing in the transformation of our economies is both viable and scaleable.

Green Jobs

I mentioned Green Jobs in Germany

UNEP is compiling research on this in collaboration with International Labour Organization(ILO) and the International Congress of Trades Unions(ICTU).

Currently there are now more people employed in the renewable energy industries than in the oil and gas industry-2.3 million versus 2 million.

And it is not just in developed countries.

- Hansen, a wind power gear box maker owned by the Indian company Suzlon is building a new factory in Coimbatore which will supply up to 3,000 gear boxes and employ 800 people. A second factory just built in Tianjan, China, will employ 600 people.

- The Indian city of Delhi is introducing new eco-friendly compressed natural gas buses which will create an additional 18,000 new jobs.

Green UN

The UN itself is part of the transformation. Secretary-General Ban Ki-Moon has not only made climate change among his priority issues, but has also initiated action on greening the institution.

Last year, heads of UN agencies and programmes including UNEP adopted a decision to work towards climate neutrality. The UN spends about $15 billion a year, meaning that such a move can have important repercussions on the greening of national and regional economies.

Hurdles to the Green Economy

Ladies and gentlemen,

It is important to recall that during the oil crisis of the late 1970s, one billion dollars was invested globally in photo voltaic research.

It triggered a 50 per cent improvement in photo cell efficiency, but then petered out as the crisis receded and the oil price came down.

Ladies and gentlemen, according to the experts we may perhaps have 10 or 15 years to start really dealing with climate change or the emissions will have risen so high and so far, it will be hard to pull back.

So where are some of the barriers. Let me mention a few.

Subsidies

Currently, fossil fuel subsidies amount up to $200 billion a year versus support for low-carbon technologies of an estimated $33 billion annually. Removing fossil fuel subsidies could reduce C02 emissions by five to six per cent annually.

R+D

Currently the pace of investment in research and development is insufficient.

The International Energy Agency estimates that R+D for low emission innovations such as renewables and energy savings declined by 50 per cent between 1980 and 2004.

In order to achieve a C02 stabilization target of 550 parts per million, support for innovation needs to rise from just over $30 billion to $90 billion by 2015 and to $160 billion by 2025 according to some experts.

Energy Savings

Over recent years, advances and investments in energy savings in transport and power generation, industry and households, have been reducing the intensity of energy used by 1 to 1.5 per cent a year.

Experts say, if the annual rate of improvement in energy efficiency could be doubled to 2.5 per cent worldwide, it might be possible to keep carbon dioxide concentrations in the atmosphere below 550 parts per million(ppm) through the end of the century.

These should be supported by policies including stronger energy savings building codes for new and existing structures; penalties or disincentives for builders to choose the cheapest, least energy efficient designs, materials and gadgets.

Other actions could include policies that promote mass transit especially rail and international minimum performance standards for industrial and household appliances.

Other measures include the promotion of utility pricing that favours energy efficiency; promotes combined heat and power and improves energy savings in existing power plants and electricity transmission infrastructure.

Renewables

Policies that increase the uptake of renewables may include 'feed-in laws' like those in German that guarantee a fixed price for each unit of renewable electricity generated alongside regulations that boost access to the Grid.

Government agencies and donors need to develop and deploy new forms of 'end-user' credit schemes to assist consumers to purchase climate mitigation technologies and systems.

New approaches are needed to assist small to medium-sized enterprises innovate including enterprise development services and seed capital.

Attention needs to be paid to new financial and regulatory solutions that address the lack of local currency financing in least developed economies-this is effectively shutting out such economies from low C02 emitting infrastructure developments.

Harnessing the 'green procurement' potential of local authorities through financial incentives that stimulate voluntary low carbon investments.

Adaptation

Adapting and climate-proofing vulnerable economies must also be part of then response.

For example a third of Africa's coastal infrastructure is at risk from sea level rise.

Public investments are needed to mobilize finance for adaptation given that market mechanisms are in their infancy.

Other actions for adaptation include regulations to limit the vulnerability of new investments and infrastructure such as bans on building in flood prone areas and new, labour intensive, programme to 'climate proof' rural areas that improve resilience of local populations; address poverty; boost incomes and increase the skills base.

Kick the C02 Habit-Kick Other Habits Too

Ladies and gentlemen,

If we can Kick the C02 Habit are there other benefits for an economy like New Zealand and for the world.

Nitrous oxide, one of the greenhouse gases produced from fossil fuel emissions and agricultural inputs also contributes to coastal water pollution and a world-wide rise in dead de-oxygenated waters.

Kick the C02 Habit equals Kicking the Dead Zone Habit.

In Bonn, at the biologically diversity convention meeting I had the pleasure to be presented with an award for UNEP from the German-based SharkProject trust.

Dr Keppler of the Trust claims level of the heavy metal mercury in shark food products now far and away break human health safety limits and many countries already have advice for pregnant mothers on eating tuna.

The biggest source of new mercury into the environment is from burning coal and there is evidence that rising temperatures in some northern lakes is also re-mobilizing old mercury trapped in sediments.

Kick the C02 Habit equals Kick the Mercury Habit.

In parts of Asia, acid rain from coal-fired power stations has become a major economic and health issue.

Kick the C02 Habit equals Kick the Acid Rain Habit.

The IPCC estimates that glaciers in the Himalayas could, by 2030 be largely gone increasing water stress across vast swathes of India. A similar story emerges in many mountain regions from Latin America and North America.

Kick the C02 Habit equals Kicking the Water Stress Habit

Globally more than two million people may be dying as a result of indoor and out door air pollution.

Kick the C02 Habit means Kicking the Air Pollution Habit as well.

Over 30 million Bangladeshis alone may be facing dislocation as a result of rising sea levels.

Kick the C02 Habit equal Kick the Environmental Refugee Habit.

One could go one.

Ladies and gentlemen

Kick the C02 Habit means Embracing the Green Economy. New Zealand, along with other countries, companies, cities and citizens have begun doing that.

Some off the measures needed are really quite simple and easier than we might perhaps at first glance think.

Tomorrow, on World Environment Day in Wellington, UNEP will publish a UN Guide to Climate Neutrality that will underline the point and show how we can all make contribute to the Green Economy.

But some of the steps are also going to be harder and some may at first seem tough if not down right impossible. They are not.

I would like to end with recalling the words of Sir Peter Blake, a UNEP envoy, America Cup winner and New Zealand hero who was tragically murdered in 2001 by pirates.

He was a tireless champion for the environment and his words are even more poignant today as we try to navigate the climate change waters to a safe harbour for all humanity.

"Having vision is not enough. Change comes through realising the vision and turning it into a reality. It is easy to espouse worthy goals, values and policies; the hard part is implementation."

Thank you