Anticipated Future Value of Public Resources (AFVPR)

Anticipated Future Value of Public Resources (AFVPR)

220px-Darnley_stage_3In 1577, Elizabeth I financed a expedition to circumnavigate the Earth. An intangible opportunity with at best a hazy, intangible, unforeseeably high-risk outcome. Like monarchs and investors before her, and long since, the Queen took the risk expecting future reward. Intelligence, competitive advantage and treasure as her return on investment, at a time when there were no sure-fire investments and steady investment vehicles. 

AFVPR takes a page from that game plan, but up-ends the high-risk nature of the ancient strategy. Using market analytics and regulatory stake-taking, we create incentives to convert the intangible value of common resources to a quantifiable risk–that is usable by the market to recharge the intrinsic value of those common resources.

 


AFVPR is predicated on the strategy of assigning value to the anticipated intangible future value of common resources.

The objective is to produce financial incentives to develop new technologies and industry, cut waste, cut pollution, and to make pristine landscape management the smart business choice. AFVPR is summarized at this link: http://davehuer.com/blog/anticipated-future-value-of-public-resources/ and with three examples illustrating how the framework could be used to help grow biosphere-enhancing economies:

Crown Oil Sands Float Rights (“Float Rights”) (from 2013-14):

  • For Alberta, Saskatchewan, and other regions with Oil Sands, an entirely new industry running in parallel with oil sands extraction — extracting the anticipated intangible value of a proven resource before extracting the physical resource. The Float Right licensee does not necessarily have to be the Liquid Right licensee.
  • This means two industries from the same resource—creating an entirely new energy/spot market, associated monitoring technology R&D/vendor industry, and banking against the future by treating the resource as a reserve when near-term market fluctuations and far-term technology advances make large-scale extraction of the physical resource uneconomic[1]. http://davehuer.com/blog/oil-sands-float-rights/

 

“Hydrological Spreads” for managing water resources (from 2014):

  • This creates an entirely new industry—monitoring and managing the anticipated future vapour value of wasted pristine public liquid water, water vapour loss and recapture as the basis for a tax credit and direct sales regime. The outline here uses California as the jurisdiction for introduction, but the solution is globally applicable: http://davehuer.com/wp-content/uploads/2014/06/huer-aquifer-float-rights.pdf
  • This is not much different from forestry management, where “the time that elapses between planting a seedling and harvesting a mature tree can be anywhere from seven to 45 years, depending on the geography and tree type (and)…the soil, rain and land must all be assessed, as well as the countries’ politics” to determine project viability” [2] — but the scale of the opportunity (emissions to atmosphere) and focus on intangibles (valuing emissions reduction) is different.
  • For example, scientific studies recently reported that the amount of polycyclic aromatic hydrocarbons emitted by the Oil Sands industry is dramatically underestimated (1,069 kilograms/year from 176 square kilometres of tailings ponds vs. the officially reported 231 kilograms/year). Hydrological Spreads can finance contamination prevention as an entirely new pollution control industry in parallel with the extraction industry.
  • In a way, this is like the Carbon Cap & Trade market, but AFVPR focuses on preventing emissions, not shifting emissions.  It could work in parallel with Cap & Trade, creating new incentives to grow new technologies and industries aimed at minimizing and preventing harm to the biosphere.

 

“Sacred Priorities Protocol (SPP)” (since 2009/10):

  • There have been complaints that intangible cultural values are not scientific and therefore should not be allowable at Environmental Review Boards.
  • SPP proposes a method to have local communities assign and map intangible values to landscapes and cultural sites, to transform them into scientific and technical values…as a means to find win-wins for joint resource and economic development projects. Again, mapping and protecting the value of the future resource for future generations: http://davehuer.com/blog/sacred-priorities-protocol/

Notes:

[1] Alberta’s former Conservative government rejected the concept, but the Notley government started looking at it soon after taking office in 2015.
[2] http://www.theglobeandmail.com/report-on-business/international-business/manulife-branches-out-from-insurance-in-quest-for-stability-and-profitability/article22278840/