Brave new world, or world of pain?

Four steps to overcoming global food, energy and water insecurity.

Karen Hussey

Development, Environment & energy, Food & water | Australia, Asia, East Asia, South Asia, Southeast Asia, The Pacific, The World

21 November 2014

Karen Hussey suggests four steps to overcoming global food, energy and water insecurity.

By 2050 there will be three billion more people on the planet. That’s a lot of extra mouths to feed, so where will we get enough food, energy and water from to sustain future generations in this brave new world?

The last century has produced significant advancements in technology, efficiencies in food production and manufacturing, great strides in improving living standards globally, and a wealth of knowledge has been gleaned about how our natural environment functions.

But one billion people living in perpetual poverty, and extreme pollution and degradation of the environment suggests something has gone very wrong. That ‘something’ is a failure to recognise the interconnections between the food, energy, environment and water sectors.

No one can suggest there has not been a lot of time, money and thought put into addressing this complex issue. But if we want to meet our future food, energy and water challenges there are four fundamental problems that must be solved.

The first, overarching problem is disjointed, inefficient and often opaque governance structures and processes that fail to account for the relationships between sectors in decision making. The result is confused government objectives that drive inefficient or perverse, or which overlook synergistic opportunities that could be exploited.

Add to this the disaggregation of governance processes, the emphasis on markets and market-based instruments to achieve public goods, the divestment of key water, agricultural and energy assets to private entities, and the result is an institutional landscape that is a veritable maze of actors and competing objectives.

Perhaps surprisingly, the solution to this disjointed, inefficient and often opaque governance landscape is more targeted and authoritative steering from the state. Better co-ordination across the sectors can only be achieved through purposeful intervention from state agencies or actors.

The second problem is that administered prices for food, energy and water do not accurately reflect their true scarcity, value to society or the environmental and economic costs of their production and consumption. The consequence is reduced incentives for users to conserve resources and use them efficiently, or for producers and suppliers to innovate or expand supply to meet industrial and consumer demands.

The solution to this problem is both obvious and fiendishly difficult to implement — governments need to introduce price signals that encourage conservation, efficiency and innovation in the supply and consumption of food, energy and water resources.

The third problem is that states’ environmental regulation and associated risk management frameworks are not sufficiently robust and flexible as to account for cross-sectoral impacts (where those impacts are known).

This is not a new phenomenon and we already have solutions available to manage it, we just don’t use them well.

For example, well-established sustainability mechanisms, such as project-level environmental impact assessment (EIA) and strategic environmental assessments (SEA), offer significant potential for integrating decision making across the food, energy and water sectors.

For procedural tools such as SEA to be effective, though, requires strong forms of state steering to ensure appropriate policy settings are implemented and enforced, and a commitment from wealthier nations to build institutional capacity in poorer countries.

The fourth problem is insufficient, incomplete or badly communicated knowledge and information on the risks and consequences of mismanaging the critical sectors of food, energy, environment and water.

In many respects a deficiency in knowledge is not the problem; rather, it is the dearth of ‘fit for purpose’ data and decision-support tools that can be readily used in policy and investment decision making. Even where there are tools and models available, there is often no consistent, common approach to the collection and publication of data, nor any standard for compatible formats to inform the viability and feasibility of various solutions.

The answer here is significant and concerted attention should be dedicated to the development of a publicly available, user-friendly integrated assessment tools, which can account for the trade-offs and opportunities between sectors and be maintained on an annual basis. Similar tools are already used by the IEA, World Bank and IMF, and Shell to develop forecasts.

At this point in time, it seems like the human race has survived inspite of itself. But you don’t need a PhD to realise what is fairly basic maths: the planet can only give so much, and unless governments move quickly to address the underlying problems with how we value and govern across critical domains of food, energy, environment and water, we’re going to be in a world of pain.

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