Future perspectives for the Lower Elbe Region 2005-2030: Climate Trends and Globalization

1. Future perspectives for the Lower Elbe Region 2005-2030: Climate Trends and Globalization Iris Grossmann Institute for Coastal Research, GKSS Research Centre, Geesthacht, Germany.

2. Location of study region

3. Overview • Research Objectives • Structure • Methods • Results

4. Investigation of possible futures for the Hamburg region • Which global and regional developments are most crucial? • What are the resulting risks, opportunities and challenges? • What could the future of the city, the port and the rural area look like?

5. Most important developments • Population patterns. • Economic and structural change. • Urban Renewal in Hamburg and increasing competition between metropolitan regions in Europe. • Climate change. • Environmental degradation and protection. • EU frameworks (agricultural policy, environmental regulations, etc).

6. These developments occur in mutual dependency. Outcomes in each field depend significantly on developments in other fields.

7. Population patterns • Population shrinking. • Population aging and retirement pensions problem.

8. Economic transition process • Shift towards service sector (share of approx. 83% in GDP and jobs in Hamburg). • Importance of ICT and knowledge both for new industries and for established sectors (job-losses). • Globalization and international competition between (city) regions.

9. Urban Renewal in Hamburg • „Wachsende Stadt“ („Growing City“). • Economic growth and reorientation. • Hafencity. • International positioning of the city (failed Olympia application). • City versus region.

10. Climate change • Possible impacts on • Flood security. • River ecosystems. • Agriculture.

11. Flood risks in the region • Risks for city of Hamburg and rural area downstream through storm surges and sea level rise. • Water levels of historic flood of 1962 have been surpassed repeatedly (six times during the nineties).

12. The Elbe ecosystems • Limnic and marine components, tidal influence and branching of currents. • Endemic species. Habitat of international and national importance for several species. • 11% of Lower Elbe river basin are EU birds reserves, 8% EU flora fauna reserve. • 3 Ramsar wetlands. • Impacts and changes: significant reduction of shallow water areas, mudflats and floodplains. Changes in depth and wideness of river, tidal hub, decrease of tidal movement.

13. Developments affecting the rural area • Structural change and EU expansion. • Reform of EU Common Agricultural Policy (CAP). • Environmental regulations. • Climate change.

14. Research Objectives Structure • Methods • Results

15. Structure • Part I: Climate change and expected impacts. • Part II: Future perspectives for the rural area. • Part III: Future perspectives for Hamburg as a port city. • Part IV: Urban Renewal and 3 integrated scenarios for the greater Hamburg region.

16. Part I: Localization of IPCC SRES A2 Scenario for the region • Of interest are water levels, temperature and precipitation change until 2030 and expected impacts on agriculture flood security and the port of Hamburg as well as on the river ecosystems.

17. Part II: Future perspectivesfor the rural part of the region • Challenges and new opportunities resulting from climate change and from legal and structural changes on the above regional level.

18. Part III: Future perspectives for Hamburg as port city • Technological developments and turnover expectations. • Changes in the port-city relationship. • Port-dependent income, jobs and costs.

19. Part IV: Integrated scenarios for the greater Hamburg region • What could possible and internally consistent futures of the region look like?

20. Research Objectives • Structure Methods • Results

21. Methodological requirements • Real-world situation depends also on politics and on stakeholders‘ attitudes and preferences. • Need to connect different fields and to plan for longterm developments. • Need to deal with unreliable, not publicly available or nonexistent data Combine different qualitative and quantitative methods including a stakeholder workshop and more than 50 expert and stakeholder interviews.

22. Method of part I: Localization A2 Scenario • Available: mean annual max. water levels at the North Sea coast for the interval 2070-2100 in A2-Scenario. • Establish statistical function to map water levels on the coast from hindcast on historic water levels in Hamburg St. Pauli.

23. Method: Localization A2 Scenario (2) • Estimate for time horizon 2030 given water levels during the interval 2070-2100. • Estimate of temperature and precipitation change for 2030 for 6 gridboxes on the basis of data from Prudence* project. • Interviews with farmers, port representatives, dike reeve. *) Cooperative European research project “Prediction of Regional scenarios and Uncertainties for Defining EuropeaN Climate change risks and Effects”.

24. The 6 grid boxes employed for the investigation

25. Method of part II: stakeholder workshop • Focus Group with participants from agriculture, nature and flood protection, administration. • Expert talks to provide input to discussion. • Development of two scenarios, policy discussion. • Later supplemented by interviews and data.

26. Method of part III: cost-benefit analysis of the port of Hamburg • Topics of interest: • Competition and container turnover. • Port-dependent jobs and income. • Costs. • Data for 2) and 3) is mostly non existent, not publicly available, and/or not reliable.  Combination of different sources of data:

27. Method cost-benefit analysis (2) • Official data (e.g. budget plan) and studies of port-dependent jobs commissioned by the city. • Check through comparison with data on long-term trends. • Check through comparison with data of other ports. • Check through expert interviews: • Experts’ opinion on data, estimate data gaps. • Compare expectations of different decisionmakers and port businesses.

28. On scenarios • Scenarios describe possible internally consistent futures. • Visulization of effects occurring on larger temporal or spatial scale. • “Eye-opening” effect. • Deal with complexity and high interrelatedness of different fields. • Allow combination of quantitative and qualitative elements.

29. Scenario building • Identify most important driving forces and areas: • Relevant global and EU trends, e.g. climate change, EU legal framework, global economic developments (boundary). • City development and Urban Renewal. • Economy, port development, structural change. • Regional cooperation and aspects of governance. • Population development. • Environmental change and protection. • For each field: investigation of trends, perspectives, uncertain elements, most important actors and their potential strategies and decisions. • Put building blocks together.

30. Important steps for the sound application of the scenario method • Identification of axes for positioning of scenarios. • Clarify connections between the purpose of the scenarios and the choice of positioning on the axes. • Critical and strategic factors for different developments.

31. Critical and strategic factors • Urban renewal. • Economic development. • Port development. • Climate change and environmental protection policies. • Viability of the rural area. • Successful regional cooperation.

32. 2 3 1 2 1,3 2 1,3 2 3 1,2 3 1,2 1 3 2 3 1 2 The axes of this study Port expansion Port decline Competition port + Weak comp. New economy success Lack of success Urban Renewal + (*) Urban Renewal - Climate change + Weak c.c. Env. protection + Weak env. prot. Reg. cooperation + Weak reg. coop. Improve governance No improvement EU / global trends (*) More resources, greater flexibility etc.

33. Other methods: Systems modeling • Systems Dynamics is an approach employing difference equations for the modeling of the dynamics of complex systems (e.g. populations, ecosystems, economic change, regional development, coupled economy-climate models). • Important distinguishing features: • feedback loops. • relatively simple structures that reproduce system’s behavior. • connect fields that are very different in nature, also integration of different modeling environments (e.g. in Vensim) • policy testing.

34. Systems modeling (2) • Important examples: • Forrester (Industrial and Population Dynamics, Sloan school of Management) • Sterman (Business Dynamics) • Meadows et al. (Limits to Growth) • Related are approaches of C. S. Holling and C. J Walters (adaptive environmental management) and H. Odum. • Used in cooperation GKSS – International Center for Climate and Society (ICCS - University of Hawaii at Manoa).

35. Research Objectives • Structure • Methods Results

36. Results part I: climate change • Mean annual max. water level in Hamburg St. Pauli in 2030 187.4 in (increase of 7.9 in, incl. sea level rise of 3.9 in). • Until 2085: 213.4 in (increase of 33.9 in). • City plans to heighten all port quay walls to 295.3 in.

37. Results climate change (2) • Temperature increase of 0.9-1.3°F (summer and winter). • Increase of precipitation in winter: up to 0.23 in/month, decrease in summer: up to 0.16 in/month. • Problems for farmers in „Geest“ (dry, sandy soils) through warmer, dryer summers. • Farmers‘ responses (hedges and trees to increase water storage capacity and prevent erosion) only possible with support through promotion programs.

38. Results climate change (3) • Problems for farmers in marshlands through decrease of winter frosts (clay soil needs to be broken up by frost, also pests are kept in check) • This cannot be compensated through ploughing a second time. • Divided opinions on flood security. • Decrease of dissolved oxygen content in river through rising temperatures: problem for fish.

39. Results part II: rural area • Diversification scenario. • Specialization scenario. • For both scenarios discussion of bottlenecks and strategies. • Policy discussion: agri-environmental programs and approaches to dike relocation / reestablishment of naturally flooded areas.

40. Policy recommendations agri-environmental programs • Programs need to be reliable and longterm. • Adaptation to individual farmers‘ needs with local authority. • Invest in communication process between local authorities and farmers. • Programs for region‘s water balance needed.

41. Results on dike relocation or summer-dike opening • No dike relocation as compensation measures for activities of city states (Hamburg, Bremen). • Long-term preparation of landowners, sensitive communication is essential. • Flexible contracts that can be adapated with local authority. • Farmers prefer to remain owners of flooded land against compensation.

42. Results part III: port of Hamburg (1) • Turnover expectations derived from changes in competitive factors and world trade projections: • Problems for Hamburg through increasing ship-sizes and bad accessibility of port. • New competitor Wilhelmshaven. • Need for dedicated terminals.

43. Results port of Hamburg (2) • Income: • Taxes: € 527m in 2001 (decrease by 21% since 1991). • € 50m rents, approx. € 47mother. • Jobs: • 112.600 /126.000 in 2001, 20% loss since 1991 according to studies of the city. • Decreased dependency of jobs on physical location of the port.

44. Results port of Hamburg (3) • Costs • Direct: €400m 2005 (includes payment obligations). • Indirect (e.g. subsidies, externalities). • Opportunity costs: • Area usage (11.5% of city area, inefficient, not very profitable compared to other business use and housing). • Conflicts with city development (Hafencity). • Competition with other possibilities of economic development.

45. Time series 1970-2004, employment in Hamburg Number of people employed in manufacturing (incl. agriculture), traffic and trade and other private and public services.

46. Hamburg‘s position in the New Economy • Comparatively small share of employees in knowledge-intensive services. • Moderate performance with respect to innovative power, R&D expenditure, number of personnel in universities but also business climate. • Inefficient airport (almost no intercontinental flights, no parallel landing /take off possible). • Global players underrepresented, none of the DAX companies has headquarters in Hamburg.

47. Results part IV: the scenariosScenario 1: The Water City • Discontinuation of port subsidies, decline of port. • Rapid buildup of new economic sectors and waterfront housing in former port areas. As a result: high quality of life. • Changes in governance, more public participation. • Core bottlenecks: lack of regional cooperation, lack of intercontinental aiport.

48. Scenario 2: Port at all Costs • Port expansion as planned. • Hamburg loses market shares through increasing ship-sizes. • City is not competitive enough in new sectors: unemployment, economic and social problems. • Decline of rural space.

49. Scenario 3: Collaboration • Regional cooperation, in particular division of labor with port of Wilhelmshaven (W.: turnover, H.: value-adding services) • Regional government. • Narrowing down on central city development projects, new economic sectors. • Lower Elbe biosphere reserve established.

50. Risks, bottlenecks and recommendations for the city • Risks and bottlenecks: • Risks for the port: • Port may not be able to fulfill changed requirements. • Costs may be too high to build up new sectors – given tough competition. • Risks related to city development /Urban Renewal. • Recommendations for the city: • Locational factors in particular new sectors. • R&D, cooperation of education system with economy. • Regional cooperation.