Consumption-based GHG emission accounting: a UK case study

Abstract

Global GHG emissions continue to rise, with nearly a quarter of it due to trade that is not currently captured within global climate policy. In the context of current trade patterns and limited global cooperation on climate change, the feasibility of consumption-based emissions accounting to contribute to a more comprehensive (national) policy framework in the UK is investigated. Consumption-based emissions results for the UK from a range of models are presented, their technical robustness is assessed, and their potential application in national climate policy is examined using examples of policies designed to reduce carbon leakage and to address high levels of consumption. It is shown that there is a need to include consumption-based emissions as a complementary indicator to the current approach of measuring territorial emissions. Methods are shown to be robust enough to measure progress on climate change and develop and inform mitigation policy. Finally, some suggestions are made for future policy-oriented research in the area of consumption-based accounting that will facilitate its application to policy.

Policy relevance

Emissions embodied in trade are rapidly increasing and there is thus a growing gap between production emissions and the emissions associated with consumption. This is a growing concern due to the absence of a global cap and significant variation in country-level mitigation ambitions. Robust measurements of consumption-based emissions are possible and provide new insights into policy options. This includes trade-related policy (e.g. border carbon adjustments) and domestic policies (e.g. resource efficiency strategies). As climate policy targets deepen, there is a need for a broad range of policy options in addition to production and technological solutions. Consumption-based emissions are complementary to production-based emissions inventories, which are still the most accurate estimate for aggregated emissions at the global level. However, without consumption-based approaches, territorial emissions alone will not provide a complete picture of progress in regional and national emissions reduction.

Keywords:

• carbon leakage
• consumption-based emissions
• greenhouse gas emissions
• policy appraisal
• sustainable consumption

Acknowledgements

This research formed part of the programme of the UK Research Centre and was supported by the UK Research Councils under Natural Environment Research Council award NE/G007748/1.

Notes

This allocation is necessary to make the emissions statistics consistent with the economic data used in economic modelling.

See Edens et al. (2011), who provide a brief history of the countries (namely Denmark, the Netherlands, Germany, Sweden, France, and the UK) that have calculated consumption-based emissions (see also Lennox et al., 2010; Nijdam, Wilting, Goedkoop, and Madsen, 2005).

Consumption-based emissions were calculated by the University of Leeds and the Centre for Sustainability Accounting for Defra, using EE-MRIO.

Initial calculations suggest that 55% of the reduction was related to the economic downturn seen in the UK.