Securing the Legacy: Financial Assurance for Mine Closure in a Changing World
(2025) In IIIEE Master Thesis IMEM01 20251The International Institute for Industrial Environmental Economics
- Abstract
- Amidst a surge in global demand for materials driving the green transition, this thesis investigates how policymakers can best ensure sound environmental performance in the Swedish mining industry following unexpected mine closures. Current Swedish financial assurance mechanisms, intended to operationalize the Polluter Pays Principle, are hampered by unclear criteria and a focus on individual sites rather than cumulative environmental impacts, creating uncertainty and adversely impacting the outcome of the instrument. This research addresses how to account for unanticipated effects in financial assurance design to incentivize sound environmental performance in the Swedish mining industry, a topic with limited dedicated research to date.... (More)
- Amidst a surge in global demand for materials driving the green transition, this thesis investigates how policymakers can best ensure sound environmental performance in the Swedish mining industry following unexpected mine closures. Current Swedish financial assurance mechanisms, intended to operationalize the Polluter Pays Principle, are hampered by unclear criteria and a focus on individual sites rather than cumulative environmental impacts, creating uncertainty and adversely impacting the outcome of the instrument. This research addresses how to account for unanticipated effects in financial assurance design to incentivize sound environmental performance in the Swedish mining industry, a topic with limited dedicated research to date. Employing a convergent, mixed-methods approach that integrates data within a distributive justice framework, the study evaluates current Swedish financial assurance, draws practical insights from South Africa's rules-based assessments, and theoretically examines alternative designs of assurance such as bonds, mutual guarantee funds, and insurance. Data sources include literature, interviews with stakeholders in Sweden and South Africa, one case study, and primary data in the form of environmental permits and associated securities for the mines currently operating in Sweden. Findings reveal that negative externalities and information asymmetries undermine the current system’s ability to incentivize environmental protection. The research suggests that clear, standardized metrics for assessing financial assurance requirements and strengthened enforcement are needed. This research has implications for improving financial assurance design in Sweden, emphasizing a balanced approach accounting for historic challenges while integrated into overall government sustainability aims. Further research could explore cross-sector analyses, consider alternative theoretical designs, and conduct longitudinal studies examining the long-term effects of varying financial assurance levels on local communities. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/9209328
- author
- Hundertmark, Emma LU
- supervisor
-
- Philip Peck LU
- organization
- alternative title
- Environmental Policy in Sweden and South Africa
- course
- IMEM01 20251
- year
- 2025
- type
- H2 - Master's Degree (Two Years)
- subject
- keywords
- mine closure, financial assurance, environmental protection, distributive justice, Sweden, South Africa
- publication/series
- IIIEE Master Thesis
- report number
- 2025:20
- ISSN
- 1401-9191
- language
- English
- id
- 9209328
- date added to LUP
- 2025-08-12 14:10:31
- date last changed
- 2025-08-12 14:10:31
@misc{9209328,
abstract = {{Amidst a surge in global demand for materials driving the green transition, this thesis investigates how policymakers can best ensure sound environmental performance in the Swedish mining industry following unexpected mine closures. Current Swedish financial assurance mechanisms, intended to operationalize the Polluter Pays Principle, are hampered by unclear criteria and a focus on individual sites rather than cumulative environmental impacts, creating uncertainty and adversely impacting the outcome of the instrument. This research addresses how to account for unanticipated effects in financial assurance design to incentivize sound environmental performance in the Swedish mining industry, a topic with limited dedicated research to date. Employing a convergent, mixed-methods approach that integrates data within a distributive justice framework, the study evaluates current Swedish financial assurance, draws practical insights from South Africa's rules-based assessments, and theoretically examines alternative designs of assurance such as bonds, mutual guarantee funds, and insurance. Data sources include literature, interviews with stakeholders in Sweden and South Africa, one case study, and primary data in the form of environmental permits and associated securities for the mines currently operating in Sweden. Findings reveal that negative externalities and information asymmetries undermine the current system’s ability to incentivize environmental protection. The research suggests that clear, standardized metrics for assessing financial assurance requirements and strengthened enforcement are needed. This research has implications for improving financial assurance design in Sweden, emphasizing a balanced approach accounting for historic challenges while integrated into overall government sustainability aims. Further research could explore cross-sector analyses, consider alternative theoretical designs, and conduct longitudinal studies examining the long-term effects of varying financial assurance levels on local communities.}},
author = {{Hundertmark, Emma}},
issn = {{1401-9191}},
language = {{eng}},
note = {{Student Paper}},
series = {{IIIEE Master Thesis}},
title = {{Securing the Legacy: Financial Assurance for Mine Closure in a Changing World}},
year = {{2025}},
}