An inconspicuous and underestimated service resource

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3 Basic Assumptions

 

These assumptions triggered and influenced the idea:

  • Virtually every product and every service requires natural resources.
  • Every money transfer for a product or service causes a consumption of resources.
  • The faster money circulates between people, the more resources are consumed.
  • Taxes, levies, certificates, environmental labels and laws can steer the consumption of resources in the short term but cannot limit it absolutely.
  • Even for the smallest and most inconspicuous products, the consumption of resources must not be neglected, because the number of units must always be taken into account.
  • Consumers are the key to sustainability because their consumer choices determine which products are manufactured under which conditions.

3.1 All products and services consume resources

 

3.3.1 Energy

 

Energy is certainly the most considered resource, whether because of the greenhouse effect, its scarcity or the emission of other pollutants. Even the methods of energy generation that we regard as ecological (photovoltaics, wind turbines, hydroelectric power plants, etc.) need resources or damage ecosystems:

  • Raw materials: steel, aluminum, copper, concrete, rare earths for magnets, chemical substances
  • Production: Toxic production waste
  • Operation: land consumption, ecosystem degradation
  • Disposal: Problematic composite materials, semiconductors, plastics

With other forms of energy, however, things look many times worse. In addition to the resources listed above, they also consume resources continuously during operation and generate toxic waste. They don't even make their energetic payback. They are thus dramatically more harmful to the environment than all regenerative energy sources and there is not the slightest chance that they can be sustainable.

If energy cannot in principle be produced without the use of resources, all products that are produced with this energy or use it automatically consume resources. In principle, this already proves that all products and services consume resources. In addition to energy, there are other resources, e.g. materials for production, operation and disposal.

 

3.3.2          Examples

 

 A car consumes resources in its manufacture, use and disposal.

 

Local public transport consumes land, energy for the operation and manufacture of means of transport.

 

A simple telephone call consumes resources because the infrastructure has to be established and operated. A guitar player needs (little) resources because his guitar is made and eventually disposed of (wood, metal, varnish, glue, energy).

 

Even a hairdresser needs scissors, a hairdresser's. All this needs energy and a variety of other resources.

 

A more inconspicuous plastic straw consumes resources in its manufacture and distribution to the end consumer. At the moment, when things are going very well, it is "recycled" energetically like many other plastic items, - which is just eyewash and self-deception. Combustion produces toxic combustion residues and CO2 - the crude oil has taken only a small detour. All these substances must be stored or regenerated by ecosystems, which is a limited service resource. If the straw is simply thrown away, it will damage a wide variety of ecosystems, which also means the consumption of resources.

 

A real straw causes a much lower consumption of resources because it has to be cultivated, processed and transported and that needs  energy.

 

 

3.3.3          How the REU Currency works

 

 By determining the REU priceeven the smallest consumption of resources can become visible. This is done just like the cash price. A single straw might only cost 0.2 Eurocent per piece, this tiny price can be calculated exactly by the manufacturer, otherwise it would be uneconomical. In the same way, a very small REU amount can also be determined and passed on to the end consumer.

No matter which product or service is provided, the REU price will represent the total resource consumption.

 

3.2          There are no environmentally friendly products

 

There are no environmentally friendly products. An environmentally friendly product would be friendly to the environment, i.e. it would help and improve the environment. However, since there are no products without resource consumption, there can be no environmentally friendly products. There are only products that are more or less harmful to the environment.

 

A thief who steals only half the cash is not friendly. He's just a little less hostile.

A product that consumes fewer resources is not environmental friendly, it is only less harmful to the environment.

 

From the gardener's point of view this radical view is correct: even if a product causes the smallest damage in her garden, she must take into account that it potentially will be produced and disposed of as often as 7 billion people want it. A single straw is harmless - but not when there are billions.

 

It is not is not problematic that products are not perfectly environmentally friendly, because the garden generates surpluses and can also neutralize many toxins. As long as the surpluses are large enough or the pollutant rates small enough, we live sustainably and can persist.

 

Ecosystems themselves also produce substances that are not environmentally friendly if their concentration becomes too high. Oxygen is an environmental toxin for anaerobic bacteria but necessary for us. CO2 protects the earth from cooling down and is important for plants. However, if the concentration becomes too high, too much CO2 is harmful to the current climate. All cycles are in a sensitive equilibrium, which makes our life possible. The conditions must not change suddenly or to our disadvantage.

 

This means that humans may also consume resources, but not in excess.

With the REU currency, the gardener can set resource prices and the budget in such a way that resource consumption does not disrupt ecosystems.

 

3.3          Consumers decide on the consumption of resources

 

Even if it is not obvious due to the multiple networked and complex production routes, all means of production and resources ultimately serve to manufacture products for the end consumer: Nobody would produce an open pit lignite excavator if it is not used to produce electricity for customers. Nobody would make a pin if he didn't have a buyer for it. Nobody would produce toxic chemicals if they were not necessary for the production of goods intended for the final consumer.

 

With every purchase decision, the consumer determines which and how many resources are used. If the consumer is responsible for the consumption of resources, he must also be given the means to recognize this responsibility and to respond to it.

 

The REU currency makes resource consumption transparent so that consumers can choose more sustainable products. At the same time, this decision is not entirely voluntary, but becomes a necessity due to the limited REU budget.

 

This seems to sound like a dictatorial system where customers are forced to act more ecologically. But it is anything but a dictatorship, but a pure market economy in which every resource becomes a limited commodity, which of course has a price. The buyer can decide at any time which products he wants to buy. In the current economy, too, a fair price is demanded for a banana; this is not blackmail and not price dictatorship.

 

3.4          Sustainability becomes measurable

 

It is very difficult to judge how sustainable a product is in the end: in the case of forests, this is possible to some extent. Its use is considered sustainable if less wood is harvested than grows back. But as soon as this sustainable wood is transported and further processed into any product, further resources are consumed (paint, energy, transport, adhesives, etc.) and further pollutants (solvents, exhaust gases, etc.) are released into the environment. If the wood is burned with the additives after its period of use, pollutants are produced that would hardly occur in the natural cycle. The question is: Is the finally produced wooden furniture sustainable because it comes from a sustainably managed forest? How can it be estimated in which periods of time these damages are eliminated by the ecosystem? How large would the ecosystem have to be in order to neutralize as many pollutants per time as are introduced? How many other products use the same ecosystem to dispose of pollutants? When is it overloaded?

 

Perfect sustainability is a prerequisite to persist. We can only improve sustainability by producing really long-lasting and recyclable products with as few renewable resources as possible, i.e. the utilization rates of the resources are ideally close to zero or at least lower than their regeneration rates.

 

This can be achieved with the REU currency by giving each product a REU price proportional to the resources consumed and at the same time only a limited REU budget. With a REU price, perfect recycling would not be optional, but mandatory.

 

3.5          Every money transfer leads to a consumption of resources

 

Every product and service causes a consumption of resources (3.1) and is paid with normal money. If there is no money available to buy a product, it will not be manufactured and no resources will be consumed. Even the possibility of selling a product for cash leads to its production and thus to the consumption of resources.

The purchase of used products triggers much less consumption of resources. But also used products must be transported and processed. Indirectly, a further consumption of resources is caused because the seller acquires other products with the money.

 

If money is donated or given away, this money transaction does not directly lead to resource consumption. However, the recipient will use it to purchase products and thus resources.

When money is transferred to a bank account, no product is purchased, but the bank will invest the money to pay interest to the account holder. The investments are used to  purchased machines whose production has consumed resources and, more importantly, these machines are used to convert even more efficiently resources into products. Bank balances thus also cause resource consumption.

 

The primary goal of many companies is to maximize sales. However, this automatically means higher resource consumption if resources are not evaluated correctly. This means that our current economic system is not in a position to become sufficiently sustainable.

 

As soon as products have a REU price, the goals of the companies have to expand: Turnover is no longer the only goal. Instead, successful products must also reduce REU costs.

 

3.6          Classic money acts like a catalyst on resource consumption

 

Each money transfer triggers a consumption of resources, see 3.5. The money is not used up and can be used again by the next owner to purchase further products / resources. Money acts like a catalyst because it speeds up resource consumption without disappearing. The faster the money changes hands, the faster resources are consumed.

 

The REU currency instead does not circulate: the REU budget is given away by the gardener to the consumer and flows back from the consumer via the production chain to the gardener, where it disappears again. The quantity of REU fed into the system ideally corresponds to the surplus REU resources and consumes itself proportionally to the resources. REU therefore do not act like a catalyst.

 

3.7          Price increases cannot permanently reduce overall resource consumption

 

Price increases can be triggered by taxes (petrol tax), levies (emission certificates) or legal regulations (the Green Dot, environmental protection requirements).

If products with a high or undesirable consumption of resources become more expensive, the consumer will forego these products or choose others. Manufacturers will improve products to make them competitive again.

However, there are doubts that these measures will lead to a permanent reduction in resource extraction:

  • An increase in the cost of money would briefly annoy wealthy people but threaten the very existence of poor people. Injustice would increase and favor wealthy people further, so a social equalization should take place. For wealthy people it is much less imperative to limit their resource consumption.
  • If consumers change their buying behavior and choose cheaper products because the more expensive ones consumes more ressources, they will use the saved money to buy other products that also consume resources. They may even buy products that consume more resources. Ultimately, all the money is put back into practice and resources are consumed.
  • Additional revenues from the state are also fed back into the money cycle, e.g. the additional revenues are paid out to disadvantaged people so that the measure is socially acceptable. According to Section 6 this cycle consumes resources again and the resource savings effect is reduced or consumption shifts to other resources.
  • Price increases lead to a higher inflation rate and then to wage increases, so that the incentive to choose cheap products is not permanent.
  • The price level does not allow the buyer to see which product consumes fewer resources. A product that is durable, environmentally friendly and more complex to manufacture can still be more expensive than a product that is made more expensive by taxes and is harmful to the environment.

At the end price increases do not guarantee a permanent reduction of resources. The consumption of resources may only shift.

 

This changes when the resources used for each product are shown with a separate price in REU. The environmentally harmful product has a low cash price and a high REU price. For the less polluting product, this will be the other way round: a high cash price and a low REU price. The measure of environmental hostility becomes directly visible and the more environmentally hostile product is disadvantaged. In addition, since the REU budget is limited and the REU currency does not circulate between people, the resources used are actually limited.

 

However, a problem cannot be solved directly with the REU price: If a product consumes fewer resources / REU over its life cycle, it may have a higher REU price in its purchase, i.e. the consumer may make the wrong decision. For some products it is therefore useful to indicate the REU costs over the life cycle.

 

Manufacturers of high-quality, environmental friendly but expensive products could guarantee an operating time instead of a time guarantee. With this guarantee, durable and therefore ecological products would become more attractive and the consumer could easily determine how much REU an hour of operation costs. Technically it would not be a problem to integrate an operating time counter into refrigerators, mixers, etc. to check the warranty promises.

 

3.7.1          Price increases through taxes

 

Taxes lead to a price increase and also to a change in behavior. However, this does not necessarily lead to a permanent conservation of resources as a whole, see above.

 

It takes a very long time for a tax to be decided. Taxes are only a reaction, they are not introduced preventively. The gardener could also react preventively to risks and evaluate undesirable substances with a high REU price. We would do the same with our own garden if someone were to dispose of a dubious substance there.

 

Necessary taxes are not introduced because the national economy suffers unilaterally (e.g. aviation fuel tax). As the gardener sets REU prices internationally according to uniform principles, such obstacles are eliminated.

 

Even if the additional tax income supports environmental projects, the money will eventually flow back to the people and the cycle begins again. It takes years for such environmental projects to be able to compensate for the damage or actually process resources. If forest areas are afforested with fuel taxes, the damage (CO2 emissions from the combustion of fuels, etc.) is immediately effective, but the compensation takes place too late and too slowly. This gap leads to a further deterioration of living conditions.

 

Austria provides an indication that this mechanism exists: In the years 2000 - 2015, eco-taxes in Austria increased by about 40%. [4]. At the same time (2000-2014), the bio capacity balance deteriorated from minus 2.5 gha to minus 3.1 gha. I conclude that taxes may change behavior, but they cannot limit resource use or protect ecosystems.

Another example is the eco portion of the fuel tax in Germany: who is aware that the tax rate includes an ecological price? Who's going to change his behavior because of this small additional costs?

 

 Even if the eco portion is quoted once, it is only to criticize environmental policy or to complain exaggeratedly about the additional costs. This is a bad service for the acceptance of environmental protection measures and the ecological effect does not exist. This example also shows that the effect is not permanent: from 1999 onwards, an environmental tax was levied on fuels in stages. This has actually led to a decline: From 47263 million liters in 1995 to 43782 million liters in 2012. But by 2017, consumption is back at 46840 million liters. [5].

Suspected causes are

  • habituation effect
  • Increasing prosperity
  • Compensation through inflation
  • The price is essentially determined by the oil markets and political situations: A few years ago, diesel fuel was available for less than one euro per liter. Who thinks of the CO2 balance or the eco levy?
  • As oil demand declines, lower demand will lead oil producers to react with price cuts to make the last profits.

If, instead, the ecological share were to be shown in REUs, it would be clear to everyone why these costs are incurred, they would be perceived as fairer and there would be no suspicion that the state is merely looking for further sources of income. REU do not finance a state, they are the comprehensible price for resources used.

 

3.7.2          Price increases due to requirements and laws

 

The legislator can impose conditions on manufacturers that regulate production or disposal. The additional effort leads to a higher price. The additional revenues are earmarked.

The Dual System Germany is an example of this. Here, licenses are acquired for sales packaging and the product is made more expensive. The license fees are intended to reduce the use of plastics and increase the recycling rate.
Since the introduction of the “Grüne Punkt” in 1991, however, the quantity of plastic packaging has increased and there is no sign of a trend reversal.

 

The Dual System Germany is an example of this. Here, licenses are acquired for sales packaging and the product is made more expensive. The license fees are intended to reduce the use of plastics and increase the recycling rate.
Since the introduction of the “Grüne Punkt” in 1991, however, the quantity of plastic packaging has increased and there is no sign that this trend will reverse.

 

In 2014, about half of all plastic packaging was recycled for energy purposes [5] i.e. converted to CO2 and pollutants (filter residues, etc.). Material recycling is only possible for clean plastics separated by type. In addition, recycled plastics may not be used for food packaging. So it is not really a recycling, but rather a delaying cascade at the end of which there is waste and no recyclable material. The green dot fails and prevents a real solution, because the consumer is sure that he has fulfilled his responsibility through the higher price, the operators are happy about lucrative business and politicians think they have a solution.

 

Product packaging is often much more problematic than simple plastic bags (weight, composite films, material mix, single use, etc.) and should even have a higher price than plastic bags. As a consequence, consumers would opt more often for less complex product packaging.

 

It is a good thing that a high percentage of plastics is collected and not introduced uncontrolled into the ecosystems. However, there are always reports that the collected plastic is exported to other countries where this waste is not properly processed. The Dual System Germany takes money, but does not provide the expected consideration.

 

It would be better to use reusable packaging instead of plastic packaging. If the ecological costs per product, i.e. including packaging, are labelled as REU price, less environmentally harmful packaging would have an advantage. In such a system, standard returnable packaging could be very attractive.

 

Similar to taxes, regulations must be negotiated for a very long time and industry successfully softens the laws in its own and not in the ecological sense, such as the energy efficiency label for passenger cars that relates to the vehicle weight [7].

 

3.7.3          Price increases through CO2 emission certificates

 

CO2 emissions certificates work roughly like the REU currency: the volume of CO2 emission certificates is limited and continuously reduced. Companies must buy the certificates or certificates are allocated. Companies that require few certificates have a competitive advantage [8].


Whether a company is competitive or not depends on many other factors (company size, service, quality, etc.). The end customer cannot see why a company's product is cheaper; let alone how ecological a product is by looking at its price. It is quite conceivable that a company may offer a cheaper product despite high certificate costs through cheaper and environmentally harmful production.

 

If, on the other hand, the CO2 emission costs were shown separately as a REU price, the buyer could select the  cheaper, resource saving alternative. By limiting its REU budget, REU costs would be an important purchase criterion.


In this way, companies that produce less environmentally harmful products at higher cost and expense (cash price high) (low REU costs) would have an advantage over companies that produce environmentally harmful products using cheap techniques (cash price low) (REU price high).

 

The environmental costs must be visible separately from the monetary costs.

The initial statements in 3.7 (inflation rate, money collected flows back, etc.) also apply to the certificates and are therefore not effective in the long term.

 

If fossil fuels were taxed more heavily (gas, coal, oil), more wood or biofuels would be burned. That would save CO2, but in principle it replaces them with other limited resources. Ultimately, ecosystems would be weakened (monocultures of energy crops, deforestation). This must also be avoided at all costs.

 

If REU costs are allocated to all resources, energy-saving technologies would be preferred to alternative movements to energy crops. E.g. through photovoltaic systems in combination with heat pumps and heat storage tanks, electrolysis of wind power, etc.

 

3.8          Laws will protect ecosystems

 

Laws are also necessary with a REU currency, since not everything can be regulated via a REU price. For example, it would be fatal to control the use of E605, Lindane or DDT only by the REU price. These substances are so harmful that they must be prohibited by law.

 

However, laws can only follow economic and ecological dynamics slowly. Legislation only reacts and must first have certainty. Preventively hardly anything is forbidden in advance; first a significant damage must occur (dioxin, nuclear energy, etc.).

 

Ecological systems are very complex and it is difficult to estimate which ecological damage is caused by which human activity. But this means that laws are likely to be passed too late, too slow, very complex and may not solve the problems. Adapting the laws is also complex and time-consuming.

Often laws are deliberately interpreted and circumvented in very different ways, which then has to be clarified in court.

 

In order to address the many environmental issues, the number of laws would increase dramatically and become confusing, as many individual resources would have to be protected. In the end, producers and consumers feel insecure, controlled and unnecessarily restricted. The acceptance and effectiveness of the laws would be reduced.

Some laws are prevented by the argument that the market should regulate this and that no complex laws are necessary. Unfortunately, that doesn't work. Many parts of the traditional economy do not focus on protecting ecosystems and voluntary commitments are worthless, such as the voluntary agreement to reduce car fuel consumption.

 

The requirement that a free market economy should solve the environmental problems fully speaks for the introduction of a REU currency: With the REU price, resources receive a value that leads to market-economically sensible behavior and limits the consumption of resources in parallel.

 

3.9          Resource efficiency is important, but not a solution    

   

Resource efficiency is of fundamental importance and must also be striven for. However, the total consumption of resources must be limited in such a way that at most resource surpluses are used. The aim cannot be to convert all oil reserves into CO2 with maximum efficiency, but to limit oil consumption so that ecosystems can neutralize pollutants. If they cannot, this resource may no longer be used.

 

There must be a mechanism to prevent resources from being overused. There must be an incentive to save resources in general and to recycle all materials, even without acute threat.

 

If people have a limited budget, they can decide whether to buy an inefficient product or spend their REU on other things. In both cases, the total resource consumption is limited by their budget.

 

I see the European energy efficiency classes for passenger cars as a strikingly bad example: A heavy car with high fuel consumption can be A++ because the high vehicle weight is efficiently transferred from A to B. The result is an A++ car with high fuel consumption. Great! So if we all opt for these "efficient" cars, the environment will be saved!

 

3.10      It is not enough to change behavior through conviction

 

You can't do it without conviction. Only when people are convinced they will change their behavior. However, voluntary changes in behavior are probably not enough:

  • Behavioral changes take a lot of time and could be too late.
  • Changes in behavior are not binding. It is within the individual decision how he behaves. The danger is that everyone does something and feels good about it, but in the end it is not enough.
  • Even if we are convinced, it is difficult for us to change uncomfortable things. Our inventiveness always finds exceptions and excuses.
  • It is not immediately apparent which behavioral alternatives lead to a lower consumption of resources. Even with the best of intentions, major damage and unexpected effects cannot be prevented. The production of palm oil and other biofuels shows how well-intentioned and state-sponsored ideas, such as the mandatory share of biofuel, can have a negative effect elsewhere.
  • We must be convinced that all other people change their behavior as well, and that the same conditions apply to all. The REU price ensures that everyone only consumes the resources given to them with the REU budget or they must earn additional REU.
  • Very often you hear arguments like "If I do this alone nothing changes, you have to start with the big environmental sinners", "I know that what I am doing is wrong, but what my neighbor is doing is much worse", "I know that this is wrong, but I have a photovoltaic system and I compensate for it". Such arguments become obsolete if everyone can only spend their REU budget. Then the neighbor may waste resources-, but he will have to save REU elsewhere.

We need to be convinced. In addition, there must be a frame so that everyone pulls together and we can't make excuses.

 

The REU makes environmental costs transparent and applies to all people. Using their own REU expenses, everyone can assess how environmentally harmful their overall behavior is and whether it is improving. Everyone can also rely on the fact that his neighbor does not consume unacceptable resources. If he apparently consumes more resources, he has earned the required REUs beforehand or bought them from other people.

 

3.11      We need a general solution

 

Solutions for special resource problems, e.g. climate change, where the service resource "CO2 neutralization" is overused, look partially successful. However, in an overall system they consider only this one problem and no side effects. Due to the many problems, many individual solutions would also have to be found. This complexity and the number of individual measures could frustrate and blunt us.

 

The REU price of a single resource could cause sideways movements: Instead of expensive fossil fuels, consumers would switch to wood heating or biofuels, for example, which would also destroy resources. It is always a matter of conserving all resources.

 

Even if in the future we will only use regenerative energies and these become very cheap, the CO2 problem would be solved, but production and operation of the plants (photovoltaics, wind, water) also require resources (areas, raw materials, ecosystems).

 

An abundance of cheap energy poses another risk: energy would no longer be a limiting factor and we would probably use it to exploit other resources more intensively. The problem is shifting. The principle must be: We must not consume more resources than we regenerate.

 

Tendencies that support this assumption can already be observed: Large, heavy and inefficient electric cars are built that run on clean green electricity so that the buyer can justify himself. But these vehicles consume a lot of other resources, from raw materials to toxins in production and disposal. At the same time, every wasted CO2 neutral kilowatt hour is missing to replace one kilowatt hour from conventional power plants.

 

If, on the other hand, the REUs were to make the costs for the production and operation of electric cars transparent, the development goals would shift and appropriate, purpose-oriented vehicles would prevail. Nevertheless, anyone could buy any vehicle within his REU budget, this freedom is not restricted.

 

3.12      Eco-labels are ineffective

 

Such labels or awards with their rating levels are a useful approach to make the environmental impact of a product visible. Often, however, they only evaluate a single aspect, e.g. energy consumption. In addition, there is a very large and confusing number of different labels, which can even be awarded by the manufacturers themselves and perhaps have no significance at all.

 

The evaluation is burdensome and would have to be repeated regularly. If this does not happen, the manufacturer has no interest in further improving products that have already received good ratings, as the changes do not become visible in the form of a new eco-label.

 

Products cannot be adequately classified with eco-labels, as they always make only rough statements.

There is also a risk that the positive effects may be reduced or reversed by rebound effects: We can choose a product with low energy consumption through an eco-label. That could be the argument for us to buy even more products. Yes, I could also use the facts as an argument as often as I like to justify the purchase of less ecological products. In total, not only more energy, but also more resources are consumed.

 

If all resources receive a separate price in REU, which is passed on transparently to the consumer, a very fine-grained, dynamic evaluation criterion is automatically created that comes close to an ecological footprint. The consumer thus has a simple, uniform means of evaluation and does not have to rely on hundreds of different, dubious labels.

 

Manufacturers can prove with a low REU price how ecological their product is and they have to withstand a direct precise comparison with competing products. For example, a heavy car would already cause higher resource costs during production and, despite the absurd energy efficiency class A++, would of course have to disclose much higher REU consumption costs.

 

Admittedly, it is then not possible to tell at a glance whether a product is ecologically expensive because so much energy was used to manufacture it or because so many pollutants were generated. But an ecologically bad product will be recognizable and the consumer can choose a better alternative. The consumer also does not need to know why one product is more damaging to the environment than another. With the normal money costs, he also does not know the cost breakdown for the product. For him, it's the REU price that counts.

 

Improvements in the production process will have a direct impact on the REU calculation of the company and the products will become more attractive. There is a permanent incentive to optimize processes immediately and in all details, just as for previous normal costs.

 

Product labels that take other aspects into account still remain, e.g. FairTrade, etc.

 

Copyright © 2019 | Martin Huck | E-Mail: info@resource-equivalent-unit.de

 
 
 
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