RESOURCE CAP COALITION WORKSHOP LIMITING RESOURCE USE

IN THE AFTERMATH OF RIO+20

SUMMARY OF RESULTS

1-3 MARCH 2013 VILANOVA I LA GELTRÚ

ORGANIZED BY

ANPED (BELGIUM) CEEWEB (HUNGARY)

ECOLOGISTAS EN ACCIÓN (SPAIN) ENT (CATALONIA)

RESEARCH AND DEGROWTH (INTERNATIONAL)

CONTEXT

Rio+20 left a vague document called “The Future we want” lacking ambition and concrete objectives and proposals: a tool not rising to the occasion of the planetary challenges ahead. However, we can find some positive political hooks where to base the necessary radical changes in the way we live in the planet. Regarding natural resources the Rio+20 document recognizes the dependency of the people's live on a sustainable use of resources. It however falls short when claiming for a more efficient use of them. The European Resource Cap Coalition (RCC), bringing together 38 European organizations advocating for a global resource use reduction, a precondition for sustainability. Partners to the RCC believe that this limitation shall be achieved for the aim of halting biodiversity loss and maintaining, as well as recovering ecosystem services, which underpin human wellbeing. But resource use reduction shall be realized hand in hand with poverty reduction and building a green economy. The Coalition just issued its proposal on how it envisages the proper resource use limitation with its foreword written by Dr. Ernst Ulrich von Weizsäcker, Co-Chair of UNEP’s International Resource Panel and Co-President of The Club of Rome. The whole proposal can be downloaded from here: http://www.ceeweb.org/wp-content/uploads/2012/03/RCC_brochure_web.pdf The RCC is committed to develop and present political proposals on resource which go beyond efficiency, designing resource caps which can effectively contribute to an ambitious post-Rio+20 agenda. The workshop builds on a previous one held in 2011 in Rupiá, where several capping options where identified, and which set the basis for a policy proposal on non-renewable energy cap and quotas system which will in this edition of the workshop be hopefully improved. In the following sections you can find the report of conclusions and minutes referring to most relevant issues debated. Moreover, Research and Degrowth partners have prepared some extra comments on this report, adding some perspectives which where not presented as such in the workshop, but we hope may be of inspiration for next meetings!

PROGRAM OPENING ROUNDTABLE Resource use in Europe: challenges and opportunities During the introductory session Tom Kucharz, from Ecologistas en Acción, spoke about The EU energy, resource use and climate objectives. He pointed out that energy extraction is about social and environmental injustices. "How can we discuss the consumption reduction in the energy use with current high level of unemployment?" There is some kind of relation between natural resources and the public deficit – the cheap access to oil in the last period had huge impacts on resources (huge infrastructures, constructions etc.). A lot of subventions were realized to facilitate fossil extraction. Europe has a huge deficit in energy export (in economic terms): 500 billion euros of deficit in energy balance.

Public discourse is linked to renewable energy, but all countries and regions are still interested in promoting fossil fuels: was it a mistake of environmental organizations or actually did the same interest exist?

Increase of competitiveness in free markets is justified with “more job creation”. Indeed, EU talks of free flows or free trade as a strategy to create more jobs, less economic problems, etc. He argues that it is not true, but all the countries in the EU and their policies seem to believe in that.

Estimated dependency in terms of energy of the EU in 2030 – a huge % of energy will come from abroad.

Raw materials are key to understand the ongoing huge changes: about lands for “flex” crops (those used for food and feed and energy production). 95% of raw materials for producing agrofuels are imported in Spain (in 2012). In 2011, it was of 85%.

EU raw materials initiative: tries to trade and invest in policies in this sense, but it is insufficient.

Multilateral discussions for rare earth metals (they want a good geopolitical situation to get the added value).

A lot of EU workers concentrate in free trade investment negotiations all over the world.

EU-US free trade negotiations: where fracking is included – with this excuse they cancel the moratorium.

It can be said that the impacts of water pollution, air pollution or damage in nature are outsourced, when resources are extracted in other countries.

It’s time to think how the power balances will be distributed all over the world in 20-40 years.

We also have to have in mind more insecurity scenarios, i.e. new crisis years. EU will be less prepared for the peak oil scenario.

Next, Elena Gerebizza, from RE:COMMON presented their work on The European Energy grab . EU Energy and market grab: Large infrastructure, investment instruments and implications

“EU energy policy and its external dimension in the context of today’s crisis where financial markets are transforming EU and global economy; creating new aspects and instruments like infrastructure”

Context

- There is a crisis of accumulation, massive liquidity in private hands and “lack” of assets where to invest.

- Since 1980s, what was public before became private. Public-private partnerships increased in 2000s. Privatization today is a different feature than it is used to be. Privatization takes place from the beginning to the end.

- Financialization: Finance is transforming the society and production, a process that has begun already. It’s slow, but ongoing.

It needs public support, governments and public institutions are the key to provide new legislations in order to promote further privatization and development of financial capital markets. We mostly hear the discourse that "the money is in private hands".

Where is the money?

In 2011, the liquidity managed on financial capital markets globally was $122.8 trillion.

In 2011, global GDP was equal to $65 trillion. $42 trillion are managed directly by individuals on behalf of 11 million “rich people”.

Financialization: what is it?

New asset classes are generated in which you can invest.

Buying and selling money is now guaranteeing much more than involving in goods and services.

Aspects of our life are mediated through financial markets, not only through markets!

EU energy policies: which infrastructure?

There has been a number of communications by the Commission. There is a need to address new dimensions of energy policy (Sept, 2011).

Commission says that “a coherent, dynamic and proactive external energy policy…”, but the statement does not involve anything related to the goals mentioned in Lisbon Treaty.

The energy grab…

This is a physical grab; all infrastructures related to gas have a high priority.

EIB (European Investment Bank): the largest European investor, 2.5 billion euro

EBRD: giving support to both public and private actors (mostly active in Eastern Europe or in the countries which recently entered in the EU.)

Both are expanding the mandate in the Mediterranean region through legislation reform, TA, PPPs (public private partnerships are ‘the’ instrument to facilitate).

Not only fuel and gas, but also renewables.

And market grab…

Export oriented infrastructure, for EU energy 'security'? It develops in parallel with energy markets. Why do we need to build energy markets is not explicitly said.

A lot of money is going to finance the intermediaries, which can be private banks which then reinvest in other financial actors or private equities etc.

Building a market: in whose interest?

The EU is planning to develop “EU-Southern Mediterranean energy partnership”-

The EU objective is to create an energy market. This has nothing to do with energy security neither of Africa nor of Europe. It is not the state who owns the infrastructures. Financial actors are involved from the beginning and it is owned by private hands. They raise money through bonds related to this structure. The interest is not only in trading, but in creating a system that they can control. It’s a sort of very sensitive issue and has lots of implications. The real threat in terms of what is EU doing today is how public institutions are used to serve the needs of financial markets.

Connecting Europe Facility

“The leverage of the EU internal energy market should be better used to facilitate large scale infrastructure projects linking the EU network to third countries, particularly ones with political, commercial or legal uncertainties.” EC Communication, 2011

The key thing is that the market should facilitate the construction of large infrastructures.

Europe 2020 project bond Initiative (PBI)/Project Bond Credit Enhancement (PBCE)

They create these instruments to raise the money aiming to reduce their risks with public money. Bonds related to that infrastructure project, the EU is creating a guarantee and evaluating it as AAA and thus providing liquidity, getting easy access to credits. That infrastructure can be made 'very secure'.

Objective:

To reduce the financial risk of projects economically and financially nonviable

To support infrastructure as an asset class

These infrastructure or construction projects can get a higher return only because there is public guarantee. The problem is first that we don’t know whether they are needed. Secondly, we are going to pay for it without being consulted.

Now it is highly debated which project is going to be supported, who decides –the commission or EIB- etc.

There is the chance for the public to question this instrument in the pilot phase so that it does not become a policy!

New elements:

Why is it happening? Until 2009 financial risk was covered through monoclines insurances and collateral financial products. Now risks are transferred to the citizens with public guarantee of EIB and national financial institutions.

Project bones to finance infrastructure have always been used, but now they started to repay themselves once they have been started. Projects are financing themselves through insurance products.

In case it does not happen?

When the project is not repaying itself, the public guarantee transforms the debt from private into public. This creates a massive public intervention supporting the expansion of financial markets.

Another important dimension is that this money is raised from pension funds or other public funds. We are asked to pay to finance these projects. If the project fails, we lose our pension funds. This is already a trap.

Paradox – this might reduce the future economic and social freedom of citizens in case public debt will be generated through useless mega projects.

Why should we take this risk from the beginning leaving the profit on financial capital markets and based on fossil fuel extraction?

Today we are able to act. This system is also applicable to renewables. The important thing is whether we accept this instrument or not!

No transition is possible if you don’t understand the role of the financial markets.

What infrastructure?

Nabucco, Helios Interconnection (solar plants exporting energy from Greece to Germany) etc. Other implications

Structured finance, use of financial intermediaries facilitates capital flows out of resource rich countries (including illicit flows, money laundering etc.).

Increased use of financial intermediaries to finance infrastructure by IFIs – no instruments in place to control HHRR, environmental, social impacts of EU investments

- Both solar projects and the massive Inga dam in Kongo are shown as ‘the solution’ to energy problems. (Controlling the massive freshwater resource of Africa)

- Energy for extractive industry and mines - Questionable whether these are renewable - Entirely centralized

These projects are fully private, private investors are involved from the beginning and they will decide who will pay. The Africans are not able to pay for the energy generated and the projects will continue to extract resources.

Distribution of this energy, controlling the access to these natural resources and energy, and financing these mega projects from public funds are important problems.

How we link them to unemployment, democracy and rights is very important.

Veronika Kiss, from RCC presented the Political status of policy proposal on non-renewable energy quota scheme.

You can see the PTT presentation here

Ecologistas en Acción presented their Contributions to the RCC proposal. through he work of Samuel Martín Sosa and Annelies Broekman

In order to present the quota scheme and the integrated comments from Ecologistas en Acción we made a map which guided the questions and answers session.

Additional comments from R&D: Infrastructure & trade limits If infrastructure outlets are reduced consumption of natural resources will automatically fall. A decrease in the consumption can never happen if there is no adjustment of the available infrastructure: i.e. highways, plants, airports, incinerators, water and energy supply system. Thus, instead of granting permits/allowances on the final product released through the infrastructures a limit on the infrastructure capacity can be set, so that behaviour can be adjusted accordingly. This might imply that certain highly polluting modes of transport will be limited automatically.

Furthermore, if international trade is limited, the accompanying transport infrastructure as well will scale down.

Both decisions, on infrastructure and on trade, need to be taken at community level with the participation of those who suffer the negative impacts of the extraction and those who consume the final benefits of the extraction.

WORKSHOP SESSION “Environmental backpacks, a heavy weight.”

The RCC policy proposal on a cap and quota scheme aims to achieve a reduction in non-renewable energy consumed inside the EU on transport, electricity, heating, industry... but what happens with the non-renewable energy consumed outside EU borders for producing goods and services which are consumed inside the EU?

The RCC policy proposal needs therefore to integrate the bigger picture if it wants to reach its goals of achieving a thorough reduction in non-renewable energy consumption. In a previous RCC (2011) workshop the need to avoid leakages of the quota system was identified as a main concern. It is therefore essential to account for those material and energy flows linked to the production/life cycle and transport of products imported to Europe. A questionnaire has been circulated with the intention to explore methods to somehow integrate the so called “environmental backpack”1 regarding non-renewable energy use for imported goods.” These questions where:

1. Do you know any methodology for accounting non-renewable energy “embedded” in products, you would particularly recommend?

2. The diversity and complexity of energy use in the different production

processes of goods and services make it very difficult to have a detailed account of the non-renewable energy consumed. However, could you outline what you consider the main elements, suitable to any production process that should be taken into account in order to design a common pattern?

3. For a sound EU policy it would be ideal to achieve a standardized and simple

method to account for the non-renewable energy embedded in imports. Can you think of aggregated indicators that could be useful? For example, by sector or by resource-use intensity?

4. Can you think of a particular example which could be taken as a starting point?

5. Integrating the issue of imported/exported goods, does the quota system aim to reduce overall commercial exchange between countries or not? If yes, what horizon of reduction of transported goods in absolute terms would be possible to consider?

The workshop has been structured according to participant’s feedback on these questions, summarized in 4 “lines of thought”: Input Output Analysis, Life Cycle Analysis, Ecological Footprint and the need for a Change in production/consumption/governance structure. The original inputs can be found here.

1 The environmental backpack or “rucksack”, is defined as follows: “The material input of a product (service) minus the weight of the product itself. The material input is defined as the life cycle wide total quantity (in kg) of natural material moved (physically displaced) by humans in order to generate a good”. Definition source: EEA. 1999. Making sustainability accountable: Eco-efficiency, resource productivity and innovation. Topic report No 11/1999.

A first group discussed which possibilities to take into account some specific indicators, identifying positive and negative aspects: Input Output Analysis

• At the country level, Multiregional Input-Output models can be used to account for the energy embedded in the consumption of goods of different countries at the global level. The problem is that the figures could results too aggregated, between 35 and 130 categories depending on the database used.

• The Joint Research Centre of the European Commission has just published 2 pocketbooks presenting a series of indicators related to the use of global resource use and pollution in relation to production, consumption and trade activities for the period 1995-2008. http://ec.europa.eu/dgs/jrc/index.cfm?id=1410&obj_id=16000&dt_code=NWS&lang=en&ori=HPG

• Although these publications do not cover energy resources, similar methods and databases could be used to asses the environmental issues covered in these pocketbooks.

Life Cycle Analysis

• At the detailed product level, LCA allows accounting for the energy embedded in products. The European Commission is already working in the harmonization of the methodology for calculating the Environmental Footprint of products, which includes fossil energy: http://ec.europa.eu/environment/eussd/product_footprint.htm

• It is difficult to account for emissions emitted abroad in order to produce goods demanded by a country with the MIO models. Research findings indicate that the emissions associated to domestic demand (in terms of “consumer responsibility”) are higher (and increased more) than the “official” (the perspective called “producer responsibility” emissions)2.

• If the objective is to cap resource use including emissions embedded in imports, we also should estimate and exclude resource use or emissions embedded in exports to avoid double accounting.

Summary of proposals

2 Iñaki Arto, Jordi Roca y Mònica Serrano, “Emisiones territoriales y fuga de emisiones. Análisis del caso español”, Revista Iberoamericana de Economía Ecológica, n.18, 2012, pp. 73-87 (http://www.redibec.org/IVO/rev18_05.pdf).

LCA if you want to put the cap on consumers. Each country can tell us how much energy embedded. We need some type of accountability body to check.

IO a good tool for a global imports, better for country level analysis, interesting information for policy analysis, for establishing the cap on a country.

HOW MUCH IMPORT DO WE WANT TO HAVE?

How to limit the imports, quantity or price (tax)?

On quantity:

1st total quota imported, consumers should have a total cap of purchase. Imports should be planed or quantified depending on what we can produce locally.

2nd establish a quota on imports and increase the price of imports.

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Calculate quota imported:

1st proposal: If you have quotas per country per material, (lets dream we have data for non-renewables) then we look at which sectors have those materials. That quota is based on what you have. If we import mobiles phones, then we dont import the copper.

2nd proposal: consumption level/product /country and then put a quota per material.

3er proposal: taxes on imports, how to distribute the taxes, based on energy embedded.

You can read complete minutes here.

A second group discussed a perspective based on the following inputs:

Ecological Footprint

• The payment for energy would follow the chain of buying/selling in a similar way as Value Added Tax (VAT) does.

• System can be extended by taking into account other non-renewable resources, as well as renewable resources (crops from agricultural land).

• The energy content of an imported product can be only be estimated approximately, because not all the steps in the production chain are known. For our quota system, we need to estimate the energy used for both production and transport. For estimating the production energy, we can use the embedded energy of comparable local products; estimating energy needed for transport is straightforward. Providing these data should be a government task. The importer of a product is charged by his government for the energy used for its production and transport. The quota system comes into play when he sells the product. When a product is exported, the quota it carries is refunded to the exporter by his government.

Re-structure economy and production

• Financial markets as key actors of the fossil fuels economy and drivers of its

financialisation.

• Challenging legislation and de-regulation of market structure is key in order to achieve transformation of the current energy intensive economic model.

• Reducing energy consumption or phasing out oil/fossil fuels in Europe cannot be achieved through a merely technical solution. Instead we need to change the power relations on which the current system is rooted, and changing the structure of the economy and production.

The discussion focused on the re-structure economy and production issues. There were lots of doubts that a quota system on a consumer level could be effective. A detailed discussion about the environmental backpacks based upon “charging through” energy or footprint in the buying/selling chain, including imports and exports did not take place.

WORKSHOP SESSION Workshop “Fair distribution of access to energy. Trade? How to trade? Or no trade at all?” This workshop was developed by 4 working groups, each trying to highlight most interesting ideas and comments on the quota distribution system, expressing them in terms of strengths/weakness, and then leaded the debate on how we could overcome these weaknesses. Mind maps where drawn in order to try to grasp the complexity of the cause/effect relation between pro and contra’s.

In order to stimulate the debate, some provocative questions have been formulated:

1. What is the role of Member States, or more in general “sovereign state models of government”, in the quota allocation proposal? Does the quota allocation system promote energy self-sufficiency for regions or does it increase the interdependence between countries?

2. What about power relations? What is exactly the political position of the Quota Management Authority? If the quota system is introduced, what changes in power balance can we expect? Doe the quota system enhance citizen control on energy management? How could the public participate in the quota allocation definition?

3. If quotas are allocated by sector, how can we distinguish different levels of sustainability between activities included in that sector? What would be a fair system of allocation inside sectors? Does the quota system enhance a change in the production structure?

4. In a no-market system who would provide the services for non renewable energy use transition? How would the quota money be accounted for? How would the State repay the providers for their services? How can we face the disadvantages of an open certified market? What products/services should be included?

GROUP 1 This discussion group developed a proposal on how the allocation of quota would be done among the consumers, following the RCC proposal very much.

Indeed the system would function on a double currency bases: euro and cookies (a quota based currency like the energy money or quota money established by central institution)

Cookies would be allocated among population equally every year, and a system to adjust to special socio-economical conditions should be taken into account. The quota’s are in this way allocated basically among consumers.

Producers of primary energy would be controlled by the state: all energy they sell would be paid in euros and cookies, in such a way that energy production may not override the cap because they can not sell energy of they don’t have cookies. This way you don’t need to control the rest of transactions all through the economical chain because producers include euros and cookies in the price, they have to put the price right.

A sound control system should be put in place so that no fraude would be done with cookies accounted in products. This group does not see the possibility to develop an LCA analysis for products because of its complexity and burden. Moreover, it should be remarked that any method in which to much importance is given to scientific data, indicators or analysis, would undergo a process of perversion. Data are by definition not objective and the research processes are easily biased. Therefore it seems better to intervene directly on the producer and consumption side, without intervening in more detailed transactions.

The energy embedded in imports from countries not using the quota scheme can be incorporated by a high tax burden (Ex. Establish a cookies price according to the worst option of the national production) or to put the adoption of the scheme as a pre-condition to do business in Europe.

Weaknesses of this system would be on the allocation of cookies at the beginning of a new business activity: a cookies credit system, with flexible mechanisms should allow starting a new production process.

Another possibility proposed is a simple cap on primary energy use: auction cookies to energy producers and then deploy through the market by the normal price mechanism. This would also provide an overall cap and the cookies auction would provide revenue for funding structural energy consumption transition. The negative aspect of such a proposal is that no equal per capita consumption rights would be given, driving to high social injustice.

Trying to make the reformist proposal more socially just, a minimum or maximum access to quota may be proposed and if you can sell the quota, you may have extra revenue which you can use to access more social justice. No guarantee that this would not lead to speculative behavior. In any case, a ground of social acceptance is needed, and no fully top down policy is desirable.

This proposal is a reformist option. What are we really winning? The proposal points out a reference tool to overcome a transition period with more social justice: inflection of energy is happening anyway, we’re then now controlling the concept, but

if we don’t do anything its just going to happing in a wild way. If the system is perceived as socially just it may have more success, therefore equal distribution of quota gives legitimacy and is desirable.

GROUP II This group at first focused on a non market system, but returned on the market based proposal because each non-trade proposal on the consumer level would lead to a black market.

The cookies allocation to companies (like the RCC proposal) seems to lead to a very complex system, therefore initial allocation of cookies is to all individuals in the countries on an equal basis and to the government; strategic sectors should take part of the government share.

In a very similar way to the previous group, at the end of the chain we have electricity producing companies and petrol stations that need to collect the cookies through their product sales, generating a distribution chain that goes back to the consumers and to the government bodies, in a similar way to the actual VAT (Value Added Tax) system.

The Bakery example: you go to the bakery and pay one euro and one cookie for your bread. This would lead to an economic competition to have a lower cookie price, which also would be reflected to all input factors.

Companies have a debt in cookies (negative saldo) and consumers should have a positive cookie saldo. When a cookie debt of a company goes too deep then he has to buy extra cookies. When a consumer has no cookies left, he also should buy additional cookies. The price of a cookie in the cookie market will rise when consumers want to consume more than their quota.

GROUP III

This group has concentrated on the importance of local currency and proposes not to allow the exchange between quota money and euros.

In any way this system would be a tool to overcome the transition to a new model, moreover at a given moment it will not be possible to save more energy as a society: quota goes down drastically, so after 10 years you don’t have underconsumers anymore. Underconsumption is only credited for with quota money, not exchangeable with euros.

The Central Quota Organization would collect the euros of overconsumption fines. The right to buy overconsumption would be divided in household caps and industrial caps, as to avoid that industry could use the savings of the households and override the cap.

If you are a household you receive quota money in local currency according to your savings but you can receive it, indirectly, in euros too in order to buy products for energy saving through the revolving fund.

Anyway there is the need for drastic tools like specific bans on products with a very negative constraint (???) and to implement complementary policies and awareness rising for society to understand the need to reduce their energy consumption.

The very rich people are allowed to overconsume in a defined time span, even if this would be expensive and a cap on maximum overconsumption would be defined. This would make the scheme acceptable for people.

You can find complete minutes here.

GROUP IV

This group points out the need to redefine the whole issue. We have no quota left to consume, we should stop totally our energy colonization aboard Europe.

The RCC proposal is considered to be too much top down orientated and does not reflect society’s needs. These should be expressed and satisfied through a bottom up proposal.

Its not clear what we mean with “national state” , as currently this is not an institution that people can control. We need new participatory community institutions. Regulation authorities should be in this community local context. We need to find the balance between the bottom up and top down approach: maybe inconsistencies of local logic with more global coordination.

A basic urgent need is to get the energy supply system back under citizen control. The experience of the emission trading system, and other similar schemes, show that institutions are not working for society’s interest. When we talk about allocation of free allocation of quotas, do we assume that quota means more import of fossil fuel? There must be a discussion on how we involve the people who are affected by our energy extraction. The assumption that any reduction in the industrialized countries will be good for the people in the south has no fundament.

We have to redefine the needs of local energy models. Production and consumption have to be transformed at community level, avoiding large scale distribution and transport systems and avoid centralized control on our energy system. The definition of energy-need is problematic and you need to have an overall picture. It’s also important to avoid the romanticized idea that a community takes good decisions and not to decontestualize the proposal. In this sense, also the perverse dynamics of renewable energy resources production should be kept in mind.

We many times fix on one model to find the solution, but many different community based proposals are possible, given the diversity of solutions on how communities can reduce their energy needs.

We need to develop a better decision making process, especially on public budget expenditures. In this sense it would be interesting to audit how much money we have put in fossil fuel based infrastructure and where would we be now if this would have been invested into renewables. We urgently need to stop public money to go into unsustainable practices.

COLLECTIVE BUILDING OF CONCLUSIONS

On Sunday the workshop participants have worked together to identify the most relevant issues that came out of the workshop experience.

The discussion was fruitful and is summarized in the next section, but it also evidenced one big issue which was not possible to overcome, nor build collectively a proposal. The main question raised was:

Q. How can you introduce social justice into ecological footprint? Once you have understood how much raw materials is introduced in a chair, you may know from which country is coming from. Connected to human rights violation. You know that that production is heavily linked to constant violation of the law that is how you politicize, you show it. Are you going on or are you going to stop it? How are you planning to embed a justice perspective to the ecological footprint? Raw materials cannot be used if they are linked to human rights violations.

R. In the quota system we have been speaking about consumption. Just reducing consumption will not fix all environmental problems of extraction and production. We should keep in mind that together with this reduction we should avoid/stop certain forms of resource extraction.

Furthermore, R&D comments: We should Investigate the Daly-Correa Tax proposal. http://www.kellogg.northwestern.edu/News_Articles/2012/supply-side-environmental.aspx By Herman Daly: http://www.countercurrents.org/daly291112.htm

Comment by Miklosh Antal from ICTA on this theory One potential criticism is that it can be a very expensive solution, which may jeopardize other green goals if it competes for funds with them. Furthermore, if fuel prices are driven up, exploration and production efforts can increase in the absence of demand control. This may result in very damaging activities.

In a book review of Sinn's "The Green Paradox – A Supply Side Approach to Global Warming" the author says: "Certainly, one can think also of ways to buy out fossil resources, but this would involve considerable amounts of money. Who could mobilize (on behalf of world public interest) such massive purchasing power capacity in order to acquire deposits of oil and gas with a view of slowing down their exploitation?" http://www.sciencedirect.com/science/article/pii/S2210422412000500 Instead of using public money for this, Sinn argues that source taxes should be levied and polluters should pay. Of course, difficulties of implementation (of worldwide taxation) are very large. This may be food for thought for further development of the proposal.

CONCLUSIONS

1. To enlarge the quota scheme, which covers only direct energy resource use, the embedded energy resource use in imported goods should be somehow tackled. Input-output analysis can be useful at country level, while Life Cycle Assessment can be useful at individual consumer level. But the latter can be difficult to measure. However, more research is needed in this issue. Besides these schemes, the material flow analysis and the work of the Global Footprint Network also can be useful. TO DO

a. search for existing initiatives, research, which have been dealing with this issue. In Spain, there are many experts, thus the RCC will contact them. The Dutch Footprint Group has developed a comparison of existing proposals. This can be a starting point for further discussion.

b. based on proper calculations on imported energy resource use, strive to develop proposals on how to decrease the amount of the trade in general (e.g. evaluate what we can produce internally and ban imports with a heavy backpack, tax what we cannot avoid to import), and later calculate proper amount of quota to be shared among countries. The quota mechanism may be developed such that above goals are met. If import and exports costs a lot of transport quota, then local products will automatically be favoured.

c. We should pay attention to social justice too. How would the proposal target human rights violation linked with extraction? However, we cannot imagine to solve all problems around the World through a single tool, but we should keep in mind and integrate the vision that only reducing the consumption within the EU will not stop immediately human rights violation caused by energy extraction in other parts of the World. Thus the RCC ask to fill the gap in regulations addressing human rights violation driven by the EU trade policies and search for coalitions, platforms (e.g. Alternative Trade Mandate) dealing with these problems.

2. The cap should be seen as a tool to reduce the unsustainable and unfair use of natural resources. The overall aim is to reduce the consumption into a scale which fits into the carrying capacity of the globe, but at the same time ensures fair share of resource. The RCC on one hand criticizes the current economic system, but at the same time proposes another model for the economy considering the reallocation of energy use based on real needs.

3. Due to the fact that the cap can be used as a tool for reducing consumption and production, the work of the RCC should be fed into other policies too, e.g. transforming the current consumption and production patterns and the renewable energy policies.

4. Before presenting our proposal the following question has to be risen: How the EU has the right to extract materials in other parts of the world. The RCC states therefore stopping harmful exploitation is the precondition to use the

quota scheme properly, thus the initial cap should be assigned considering stop some extraction processes and not consider the total energy consumption cap merely based on the previous year consumption. Furthermore, the cap should be assigned in harmony with the de-growth concept. If the cap on energy is not enough special imports could be forbidden additionally.

5. Further improve how to allocate the quotas among companies, industrial sectors in order to avoid their power to dominate other interest. Therefore, those actors, which are affected by the system should be more properly defined. One proposal focused that all quotas are distributed among end consumers, including public authorities (public goods and services) and people, while all the companies earn the quota when they sell their energy units to the end users. Likewise, the energy use limitation could secured from the demand side, enhancing an overall decrease in energy use by awareness of consumers.3

6. Considering the need to change the current property rights of energy supplies, e.g. the energy market oligopoly in private hands should go back under the control of the government and citizens.

7. Carry out strong awareness raising campaign in order to change the current paradigm on “consuming makes you happy”. Through the campaign people will get closer to the aim of the cap, the need for reducing the consumption. Moreover, in all discussion groups there was a consensus on the fact that there is a profound need for re-democratization of our society before any possible proposal could be effective.

8. Ensure transparency, monitoring and proper control. The quota amount companies use should be public, and if some would require much more, society movements can advocate for moderating their consumption.

a. The centralized authority should be really strong, and under public control, However, it can be also split into two parts, one assign the amount of quota, while the other would manage the trade and the management of the quotas.

b. Instead the centralized authority, local institutions could possibly be assigned, and be responsible to allocate and manage the quotas.

9. Avoid the harmful consequences of free trade.

10. We should develop a strict proposal at EU level, not to miss the opportunity to present it Potocnik. Our original strict proposal will be watered down anyway. E.g. progressive price for extra consumption should be part of it.

11. Some participants think the whole quota scheme may not be the right tool to reach the energy consumption reduction aim because of its top down approach. They identify the weaknesses of the system as:

a. Corruption

b. Big chance for loopholes and not proper regulation

3 http://goteo.org/project/grabando-oligopoly2

For instance, in order to calculate the embedded energy or hidden flows in the imports, we should trust on data given by the producing countries about their own production schemes: imports with larger embedded energy are penalized, countries will try to report low values of embedded energy (similarly the oil producing countries report higher reserves than real in order to exploit more oil)

c. Weak power of the centralized authority

Weak power, so no way to enforce the mechanism. On the other hand, if the system were successful and the centralized authority really powerful, could it inquire into the internal matters of countries, companies, and even citizens all over the world, under the purpose of controlling the fossil-quotas?

d. Nowadays social movements, citizens, have little influence on the World Bank, or IMF, even on the EU. Transnational companies can lobby those institutions. Therefore, in the future, why should it be different?, how should it be possible for citizens to have control on a powerful international and centralized authority?

d. More bottom up approach should be promoted, but focusing only on local initiatives is not enough, since big companies will go and destroy local and small scale initiatives. Thus both approaches should go hand in hand, while the bottom up approach should support the top down approach in the field.

The other option is working exclusively on the bottom up approach (i.e., pushing for transition to renewable, ecologic agriculture… in the local level), and at the international level, keep on working on prohibition of imports related to violation of human rights, campaigning against transnational companies…

This debate needs to be followed up focussing on the weaknesses identified and the opportunities to enhance social justice objectives through the quota scheme design. As the Dutch Footprint Group comments: they consider to participate in the RCC work. They hope to develop and discuss good proposals, that can, with mathematical precision, bring down the material consumption (expressed in non-renewable energy, CO2, or ecological footprint) of our West European countries, either per country or within the EU as a whole. The basic thought is that within the limits the Earth confronts us with, and without taking resources from other – mostly poorer – countries, we give each individual an equal share of this lessening supply of resources. In this way the Dutch Footprint Group firmly believes that a quota system is a social just way to handle scarcity.

Care must be taken that proposals are simple, so every citizen can understand them, and that proposals are full-proof against abuse, including speculation.

The Dutch Footprint Group thinks that a quota system can handle a large part of the environmental problems we are facing, without having to discuss the economic and political system otherwise. Of course the financialisation of the society must be tackled,it simply should stop. Moreover a discussion about population decrease (by promoting smaller families on a voluntary basis) should start. But a quota system is vital in getting resource use under control.

SEARCH FOR PARTNERSHIPS & POTENTIAL PLATFORMS

• Alternative Trade Mandate: 10-11 April, 2013 in Brussels on how to conclude its input to the Raw Material Initiative and on how to campaign with it towards the European Parliament election.

• Seattle to Brussels Network: Raw Material Initiative works on presenting views on resource extraction campaigner from the Global South.

• Campaigns on free trade negotiations: EU-Central America and EU- EU-Central America and EU-Peru, Columbia. Eurolat: Development and Trade Committees has assessed the impact on the Latin American extractions and propose changes in EU policies, but it is blocked in the European Parliament.

• Concord: development NGO platform working on raw materials too, develop materials on raw materials extracting in the developing countries which have already developed some kinds of caps within their activities, e.g. food security, food sovereignty movements. They have already developed proposals how to limit the import of soy and agrobiofuels. They advocate for internal agricultural production, which means the ban on any kinds of protein import.

• International Farmers Movement working with FAO and established a Committee involving civil society representatives, through which they can directly influence decision-makers. We should use this example as a good one, and advocate for a similar relation to the raw material policy discussions.

• CSD will be changed for HLF, while CSD worked with 9 Major Groups, these MJs should be involved in the work of the High Level Forum especially in the OWG on Sustainable Development Goals

• people working on the Raw Material Initiatives have a mailing list coordinated by Oxfoam Germany.

• SOM Energia: aware of networks dealing with sustainable energy.

• Degrowth Movement At the next conference of the European Society for Ecological Economics we will organize a session on Degrowth proposals where CAPing resources will be on the agenda. We can present a summary of the results from Vilanova, for example.

Furthermore, idea is to organize a conference on developing the Degrowth bullet points further (in the coming year), where session on Natural resources is dedicated.

A course on degrowth will hopefully happen in the fall of 2013 in Barcelona where we can have a working session on the topic.

• Antifracking Movements, especially from France.

• CEE Bankwatch how to redefine public money to be spent on energy.

• It is time to scrap: Report on the EU Emission Trading Scheme CEEweb already joined, it is worth disseminating it.

• Stop the Financiarization of Nature Network: against of the commodification and privatization of nature, groups form all around the world

• In The Netherlands: together with the Platform Sustainable and Social Economy the Dutch Footprint Group talks with the Dutch Partij voor de Dieren (party for the animals) about an expert meeting on quota systems.

RCC CALENDAR

1. Meet Potocnik, organize an expert meeting, contacting the MEPs, even before the summer 2013The European Parliament adopted the EU Energy Efficiency Directive (EED).The EED establishes a common framework of measures for the promotion of energy efficiency within the Union in order to ensure the achievement of the Union’s 2020 20 % headline target on energy efficiency and to pave the way for further energy efficiency improvements beyond that date. In other words, the EED obliges Member States to enhance their energy efficiency by 20%. The RCC policy proposal could serve as a proper tool to meet this commitment if it is implemented properly. Therefore, the RCC will compile a guideline on how the RCC Proposal contributes to the implementation of the EED at Member States level.

2. Keep informed the EC, and asking for processes where we can influence. 3. The European Resource Efficiency Platform's objective is to provide high-level

guidance to the European Commission, Members States and private actors on the transition to a more resource-efficient economy. The RCC keeps on following and influencing the Platform’s activities. The Coalition for Energy Savings has been created to make energy efficiency and savings the first consideration of energy policies in Europe, as driving force behind a more prosperous, sustainable and competitive Europe. The RCC keeps on following and influencing the Coalition’s activities.

4. Input to the negotiations on Sustainable Development Goals at EU and at UN levels.

5. Input to the EU-EuropeanTradeStrategy 6. Input to the designation of the EU Energy Policy 7. Ask for info from the CEE Bankwatch.