Cas d’etude de Villes Vertes: Chicago Tri-State metro-region Rencontre du CRIES de la region Ile de France 18 juin 2012 Alexis Robert Analyste des Politiques Unité de Developpement Urbain Division des Politiques de Développement Régional

The OECD Green Growth Strategy www.oecd.org/greengrowth  Not just about recovery… …a core economic strategy that leads to a different way of thinking about development. Defining green growth Green growth means fostering economic growth and development while ensuring that natural assets continue to provide the resources and ecosystem services on which our well-being relies. To do this it must catalyse investment, competition and innovation which will underpin sustained growth and give rise to new economic opportunities. OECD (2011), Towards Green Growth OECD Green Growth Strategy Green growth aims to steer economic growth in a different direction, addressing externalities and other factors poorly served by current measures of economic activity. It also recognises that environmental policies that do not support economic growth and wealth creation are not sustainable in the long term.  Why green growth? Not just about recovery: a core economic strategy that leads to a different way of thinking about development Green and Growth are not mutually exclusive but go hand in hand Towards Green Growth, Towards Green Growth - Monitoring Progress: OECD Indicators and Tools for Delivering on Green Growth launched on 25 May at the OECD Ministerial Council Meeting. These reports respond to the request of Ministers from 34 countries who signed a Green Growth Declaration in 2009, committing to strengthen their efforts to pursue green growth strategies as part of their responses to the crisis. 

What is urban green growth? Extending the scope of the OECD definition of green growth A need for new sources of urban growth The presence of policy complementarities at the local level The importance of social equity to urban development Defining urban green growth Fostering economic growth and development through urban activities that reduce negative environmental externalities, the impact on natural resources and the pressure on ecosystem services. The greening of the traditional urban economy and expanding the green urban sector can generate growth (through increased supply and demand), job creation and increased urban attractiveness. These effects are in part the result of stronger interactions at the urban level among economic efficiency, equity and environmental objectives. OECD (2011), Cities and Green Growth: A Conceptual Framework How does this apply to cities? The scope of the OECD definition of green growth be extended to urban areas in three ways, by taking into account: A need for new sources of urban growth. Urban areas have the opportunity to conduct environmental policies that can foster these new sources of economic growth. 2. Policy complementarities present at the local level There are more opportunities on the local level, as activities related to environmental protection and economic development are more integrated at the local level than at the national level. 3. The importance of social equity to urban development The implementation of green growth at the local level addresses social issues in a more direct way than at the national level. As such, the OECD defines URBAN green growth as follows: Fostering economic growth and development through urban activities that reduce negative environmental externalities, the impact on natural resources and the pressure on ecosystem services. The greening of the traditional urban economy and expanding the green urban sector can generate growth (through increased supply and demand), job creation and increased urban attractiveness. These effects are in part the result of stronger interactions at the urban level among economic efficiency, equity and environmental objectives.

How do we assess green growth in cities? How green initiatives can increase Urban attractiveness Jobs Supply and demand of regional green goods and services  Focus on opportunities to in greening urban sectors Land-use Transport Buildings Waste and Water Opportunities for green firms

Key assets Strong specialisations 4 of 5 strongest specialities in Chicago Tri-State metro-region related to buildings sector 36% of all green sector jobs are in buildings sector Strongest specialisation in water technologies in the US in the Milwaukee metro-region Largest green economy exporter in the US (USD 2 billion annually) Strong green sector employer More jobs in air and water purification technologies than any other metro area in the US Second-largest employer in the fields of green chemical products, green architecture and construction, and public mass transit. US wind power-related manufacturing facilities This was part of the Territorial Review of the Chicago Tri-State metro-region. As we presented on the full Chicago review this morning, I will just briefly explain the key findings and messages of the Green Growth Case Study of the Chicago metro-region, which we conducted as part of the review. Following my brief presentation, I will invite two Chicag High specialisations in building related sectors and in water technologies. highest number of LEED-certified square-footage more than 4 000 LEED- certified experts in the City of Chicago alone Chicago metro-region is home to greatest volume of green sector exports in the US The Chicago Tri-State metro-region exhibits strong specialisations in building-related activities, such as professional energy services, and green architecture and construction. Building related activities account for 36% of jobs in the metro-region. In the Chicago-area 21- county region, the Milwaukee metro-region is home to the strongest specialisation by far in the US in water technologies.

Key challenges Emissions from buildings are high Congestion and transport emissions - sprawl is a factor Water and air quality has improved but is still substandard in places Waste generation is high GHG Emissions from Electricity Use GHG emissions from ground transportation High specialisations in building related sectors and in water technologies. Chicago metro-region is home to greatest volume of green sector exports in the US Emissions from buildings are high Sprawling land-use patterns contribute to congestion and transport emissions – most people cannot get to work via public transit Water and air quality has improved but is still substandard in places, and waste generation is relatively high, pointing to room for improvement.

Key issues Insufficient investment in public transit Barriers to entry on building retrofits Pricing for water and waste do not reflect “true cost” of service delivery and environmental impacts. Industrial/Energy Venture Capital Deals 1995-2011 Renewable and energy efficiency technologies not yet cost- competitive Venture capital investment in green tech is low The low price of fossil fuels may be stifling innovation Investment in transportation infrastructure is lagging Building energy efficiency retrofits face cost barrier to entry ESCOs have worked for commercial buildings but not for residential buildings Federal policy obstacle to low- interest loans Renewable energies and energy efficiency technologies are not yet cost- competitive. Pricing for water and waste do not reflect “true cost” of service delivery and environmental impacts. Venture capital investment in green tech is low, and connections with research institutes could be stronger. The low price of fossil fuels may be stifling innovation in renewable energies and energy efficiency technologies.

Key recommendations Connect property owners to Energy Service Companies for retrofits Green design standards to stimulate building-sector innovation Regional wind consortia Increase public transit funding (congestion charges and value-added taxes) Restructure water and waste pricing The Milwaukee Water Council: a model for other sectors Regional priority-setting and information sharing Federal price signals and legislative changes for property-tax loans Further facilitate individual property owners’ use of ESCOs, which are working for commercial buildings. Consider green design standards as a way of further stimulating innovation in the metro-region’s strong green buildings sector. Actively participate in regional consortia of wind industry Increase funding for transportation, e.g. congestion charges and value added taxes should be considered as new sources of funds. Restructure water and waste pricing throughout metro-region to encourage conservation and recycling. Extend the model of the Milwaukee water cluster to building and wind sectors. The Milwaukee Water Council presents an important model for green tech clusters in the Chicago Tri-State metro-region, particularly as it has: (i) actively linked a wide range of water-related firms, resulting in a stronger and more diverse regional water tech supply chain; and ii) fostered partnerships between university research institutes and the private sector, which has resulted in innovative research and technology transfer. Priority setting on a regional basis – for identifying funding opportunities, strengthening greentech clusters, transportation investments, building, water and waste pricing. Many green sector initiatives are still not financially sustainable, and depend on state and federal support. There is a need for a regional effort to identify funding opportunities from both public and private sources for projects that could increase the cost competitiveness of the green technologies produced in the metro-region. Role for the federal government – pricing signals on carbon, legislation changes Federal action is needed on two fronts: (i) a federal price signal on carbon would increase the competitiveness of green energy related activities; and (ii) federal legislation is needed to allow municipalities to create programmes in which property owners repay city-backed loans for energry efficiency or renewable energy technologies through property taxes.