Trends of the EU’s territorial and consumption-based emissions from 1990 to 2016

Abstract

Emissions of CO2 from the EU can be estimated using different system boundaries, depending on the policy question. We analyze and compare the trends in territorial emissions (1990–2016) and consumption-based emissions and emissions embodied in trade (1990–2014). We find the Global Financial Crisis (GFC) in 2008 was an important turning point. Territorial emissions were roughly stable in the years before the GFC but have since declined. Consumption-based emissions rose from 2000 to the GFC but then declined in concert with territorial emissions. A Kaya identity decomposition suggests that the main factor pushing the EU’s territorial emissions up before the GFC was a growth in GDP, balanced by constant improvements in energy and carbon intensity. The large increase in consumption-based emissions up to the GFC was mainly due to emissions from the production of imported manufactured goods, particularly from China. After the GFC, the Kaya identity decomposition suggests that lower GDP growth facilitated a sustained decrease in territorial emissions. The decline in consumption-based emissions since the GFC was partly due to decreasing territorial emissions but accelerated due to a decrease in the emissions from the production of imported products from China. Preliminary data indicates that EU CO2 emissions have increased from 2014 to 2017, with the Kaya identity decomposition suggesting the increase is due to a return to stronger GDP growth.