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15.992 S-Lab: Laboratory for Sustainable Business Spring 2008

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Ecological andEconomic Sustainability

John StermanS-Lab

7 Feb 2008

What is sustainability?What is sustainable development?

Brundtland Commission (1987): “Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”

http://www.un-documents.net/wced-ocf.htm

A Finite PlanetInsolation

(Solar energy)

Infrared EnergyRadiated to

Space

High-Grade(Low Entropy)

Resources

Capital,Labor,

Technology

High-EntropyResources (Wastes)

Natural Capital

Formation

Human Economy,Society

Natural CapitalStocks

Pollutant Stocks

Necessary Conditions for aSustainable World

1. Renewable resources can be used no faster than the rate at which they regenerate.

2. Pollution and wastes can be emitted no faster than natural systems can absorb them, recycle them, or render them harmless.

3. Nonrenewable resources can be used no faster than renewable substitutes for them can be introduced.

Source: Herman Daly

Resource Available Regeneration Consumption

1. Renewable resources can be used no faster than the rate at which they regenerate.

2. Pollution and wastes can be emitted no faster than natural systems can absorbthem, recycle them, or render them harmless.

Pollution, Waste Waste

Generation Recycling, Decay

3. Nonrenewable resources can be used no faster than renewable substitutes can be introduced.

Resource

AvailableConsumption

Heat Stored at Earth's Surface Energy from Sun

(Insolation) Energy

Radiated to Space

Average Surface Temperature

+

CO2 in Atmosphere

CO2 Emissions CO2 Removal

-

Example: Earth’s Energy Balance

and Climate Change 2 8 0

3 0 0

3 2 0

3 4 0

3 6 0

3 8 0

1 8 5 0 1 9 0 0 1 9 5 0 2 0 0 0

Atm

os

ph

eri

c C

O2 (

pp

mv

) Atmospheric [CO2], ppmv

World Population Growth .

0

2

4

6

1900 2000

0

2

4

6

0 400 800 1200 1600 2000

Bil

lio

n P

eo

ple

Lower Bound

Upper Bound

Average Growth Rate:1900 - 1950: 0.86%/year (doubling time ! 80 years)1950 - 1997: 1.76%/year (doubling time ! 40 years)

February 2008:6.65

Billion

Net Increase today: ≈ 77 million/year

Real Gross World Product, 1950-2004

Ave Growth Rate ≈ 3.5%/yearDoubling Time ≈ 20 yearsAt that rate, in 100 years GWP 32 times larger

Possible Futures Fluctuation

around equilibrium

Time

Human Activity

S-shaped Growth:Smooth, gradual transitionto equilibrium

Overshoot and decline

How will growth end?Growth in human activity cannot continue forever

on a finite planet. How will we make the transition?

Voluntarily or involuntarily?

Smoothly & peacefully or catastrophically?

With what population?

What standard of living?

What quality of life?

What degree of equity and social justice?

What role for nature, other species?

IPAT Impact = Population * Affluence * Technology

Example:

CO2 = Population * Income * Emissions Emissions Capita Dollar

Tons = People * $/Year * Tons year Person $

Impact =

Population

* Affluence

* Technology

4

5

6

7

1980 1985 1990 1995 2000 2005 2010

World Population

Billio

n

Source: US Census Bureau

0.0

0.5

1.0

1.5

1980 1985 1990 1995 2000 2005 2010

Carbon Intensity of the Economy

To

ns

CO

2/T

ho

us

an

d R

ea

l $

Source: DOE EIA

0

1000

2000

3000

4000

5000

6000

1980 1985 1990 1995 2000 2005 2010

World Average Income/Person19

90 $

/Year/

Pe

rso

n

0

5

10

15

20

25

30

35

1980 1985 1990 1995 2000 2005 2010

World Carbon EmissionsFrom Fossil Fuel Use

Billio

n T

on

s C

O2/Y

ear

Source: DOE EIA

Emissions requiredImpact to stabilize [CO2] at

= ≈ 450-500 ppm

Population

*Affluence

* Technology

0.0

0.5

1.0

1.5

1980 1990 2000 2010 2020 2030 2040 2050

Carbon Intensity of the Economy

To

ns

CO

2/T

ho

us

an

d R

ea

l $

Assumes decline at historical average (-1.1%/year)

0

10

20

30

40

50

1980 1990 2000 2010 2020 2030 2040 2050

World Carbon EmissionsFrom Fossil Fuel Use

Billio

n T

on

s C

O2/Y

ear

4

5

6

7

8

9

10

1980 1990 2000 2010 2020 2030 2040 2050

World Population

Billio

n

Source: US Census Bureau

0

2000

4000

6000

8000

10000

1980 1990 2000 2010 2020 2030 2040 2050

World Average Income/Person

199

0 $

/Yea

r/P

ers

on

How will we achieve sustainability?

• Better Technology? • Lower Consumption? • Lower Population?

• Huge technical, economic, political,social and ethical issues for each

• All options linked by intricate feedbacks

Before industrialization: High Death and Birth Rates -> Slow pop growthDuring transition: Death rates fall faster than birth rates -> Rapid growthAfter Transition: Low Death and Birth rates -> Slow, no, or even negative growth

Demographic Transition: Early Industrializer

0

10

20

30

40

50Sweden

0

2

4

6

8

10

1750 1800 1850 1900 1950 2000

CBR Population

Cru

de

Bir

th R

ate

, C

rud

e D

ea

th R

ate

(pe

r th

ou

sa

nd

)P

op

ula

tion

(millio

ns

)

CDR

Demographic Transition: Later Industrializer

0

10

20

30

40

50Egypt

0

10

20

30

40

50

60

1750 1800 1850 1900 1950 2000

CBR

Population

Cru

de

Bir

th R

ate

, C

rud

e D

ea

th R

ate

(pe

r th

ou

sa

nd

)P

op

ula

tion

(Millio

ns

)

CDR

Much faster drop in Death Rate; Same slow decline in Birth Rate.Result: Faster population growth to higher level before transition complete.

Population Inertia

-400 -300 -200 -100 0 100 200 300 400

0-4

10-14

20-24

30-34

40-44

50-54

60-64

70-74

80+

Population (millions)

Ag

e

Male

World

Female

1998: ≈ 6 BWorld Age Structure 2050: 9.4 B

-400 -300 -200 -100 0 100 200 300 400

0-4

5-9

10-14

15-19

20-24

25-29

30-34

35-39

40-44

45-49

50-54

55-59

60-64

65-69

70-74

75-79

80+

Population (millions)

Ag

eMale Female

World

-10 -5 0 5 10

00-04

05-09

10-14

15-19

20-24

25-29

30-34

35-39

40-44

45-49

50-54

55-59

60-64

65-69

70-74

75-79

80+

Population (millions)

Ag

e

Male Female

Brazil

Human Ecological Footprint

Footprint and Biocapacity (Carrying Capacity)

Number of Earths Used by Humanity

Ecol

ogic

al fo

otpr

int (

num

ber o

f pla

net E

arth

s)

1961

1964

1967

1970

1973

1976

1979

1982

1985

1988

1991

1994

1997

2000

2003

0.0

0.5

1.0

1.5

20051960

0

1.5

Image by MIT OpenCourseWare. Adapted from Figure 1 in Wackernagel, et al. "Tracking theEcological Overshoot of the Human Economy." PNAS 99, no. 14 (2002): 9266-9271.

Number of Earths Used by Humanity

Biocapacity

Glo

bal h

ecta

res p

er p

erso

n

1961

1964

1967

1970

1973

1976

1979

1982

1985

1988

1991

1994

1997

2000

2003

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

20051960

0

4.0

Image by MIT OpenCourseWare.

Ecological Footprint by Region

Courtesy of Jerrad Pierce. Used with permission.

S-Lab Spring 2008 Footprints

My Footprint: No Flying, 2.4; With Flying, 4.7

CATEGORY (Now) Low Median Mean High

FOOD 1.00 5.00 4.87 7.00

MOBILITY 1.00 2.00 3.35 9.00

SHELTER 1.00 4.00 4.60 13.00

GOODS/SERVICES 2.00 5.00 6.29 17.00

TOTAL FOOTPRINT 9.00 17.00 19.22 42.00

IF EVERYONE LIVED LIKE YOU,

WE WOULD NEED THIS MANY

PLANETS. 2.00 4.00 4.38 9.00

CATEGORY (Future)

FOOD 1.00 4.00 3.77 7.00

MOBILITY - 4.00 3.92 8.00

SHELTER 1.00 3.00 3.48 9.00

GOODS/SERVICES - 6.00 6.27 18.00

TOTAL FOOTPRINT 4.00 17.00 17.52 40.00

IF EVERYONE LIVED LIKE YOU,

WE WOULD NEED THIS MANY

PLANETS. 1.00 4.50 4.54 10.00

How much is enough? How much would you need to spend each year to be happy? That is, how muchconsumption would be enough to satisfy you?

Consumption spending here means expenditure to provide for the lifestyle you wish tohave, including food, clothing, shelter, travel, entertainment, and all other expenditureson goods and services.Consumption does not include charitable giving, but only what you spend on yourselfand your immediate family.Consumption does not include saving or investment (for example to build futureincome for retirement).Consumption does not include payment of income taxes, but only the cost of the goodsand services you purchase.Choose one of the following options:

A. $ per year is enough.

B. At least $ per year, but more is always better.

How much is enough?S-Lab Students Spring 2008

GDP/Capita (PPP$/capita, 2004) Class Mean/ Average

US $39,676 2.62

High Human Development Nations $26,568 3.91

World $8,838 11.8 Low Human Development Nations $1,113 93.4 (source:UNDP Human Development Report 2006; http://hdr.undp.org/statistics/data/)

Low Median Mean High

Class Average 5,000$ 60,000$ 102,542$ 750,000$

- 1yr MBA 20,000$ 60,000$ 100,478$ 750,000$

- 2yr MBA 30,000$ 50,000$ 104,000$ 500,000$

- 1yr LFM 5,000$ 50,000$ 62,571$ 200,000$

- 2yr LFM 40,000$ 77,500$ 98,750$ 200,000$

- Fellows 50,000$ 165,000$ 170,000$ 300,000$

- non-Sloan 50,000$ 50,000$ 62,000$ 100,000$

2.57 3.86

11.60 92.13

More is always better: 58%

Our global civilization is not sustainable

• We depend on nonrenewable resources • We consume renewable resources faster than they regenerate

• We generate wastes faster than they canbe absorbed and rendered harmless

• We have pushed the ecosystems of theplanet into new regimes in which we haveno experience and do not understand

Growth Is Ending • Growth is rapidly deepening our unsustainability • Population (but demographic transition) • Economic growth

• Growth will stop. • Question is not if, but how, when; • Voluntarily and peacefully or involuntarily and

convulsively?

Innovation,Technology & Markets • Powerfully increase environmental degradation

– By enabling growth – Through unanticipated side effects

• Essential in creating a sustainable world – Moderating our impact on the global carrying

capacity– Repairing the damage we’ve already done

BUT There is no purely technological solution to thechallenge of creating a sustainable society.

Next Time What can we do?

What are the barriers to action?• Please read:

– Repenning and Sterman (2001) Nobody ever gets credit for fixing problems that never happened.

– Repenning et al. (2001) Past the Tipping Point: The Persistence of Firefighting in Product Development.

– In Many Communities, It’s Not Easy Going Green, New York Times 7 Feb 2008 (on the MIT server) ***NEW***

• Please think about the following questions: – Have you ever worked for an “overloaded” organization that was stuck

in the “firefighting trap”? Why were you stuck? Did the organization recover? If so, how?

– What are the major barriers to “going green” inside a for profitcorporation? How can they best be overcome?