Indicators for national consumption-based accounting of chemicals

ABSTRACTIn 2017 the paper ‘The Sustainable Development Oxymoron: Quantifying and Modelling the Incompatibility of Sustainable Development Goals’ was published, showing that there is a conflict between socio-economic development goals and ecological sustainability goals using cross-country time-series data. The authors looked at production-based CO2 emissions to measure and model the 13th SDG goal addressing climate change. Their models showed that production-based CO2 emissions were stalling or even decreasing in rich countries, which suggests that other countries are also likely to see stalling and decrease in their CO2 emissions once they become rich. However, this conclusion can be challenged when accounting for consumption-based CO2 emissions rather than production-based CO2 emissions. In this follow-up paper, we re-run some of the analyses performed in the original paper making use of consumption-based CO2 emissions. The analysis confirms the inherent SDG conflict between socio-economic and ecological SDGs. But, this new analysis demonstrates that from a consumption perspective the trend of stalling or decreasing CO2 emissions is reversed, with natural depletion costs being exported to poorer countries. Despite this new perspective on CO2 emissions, the conflict between SDG goals can still be avoided by making investments in public health, education and renewable energy, as suggested in the original paper.

Improving consumption based accounting for global capture fisheries

Modeling the cost transmission mechanism of the emission trading scheme in China

A Fundamental Factor Model

This paper considers a recently developed consumption-based carbon emissions database from which emissions calculations are made based on the domestic use of fossil fuels plus the embodied emissions from imports minus exports, to test directly for the importance of trade in national emissions. The People’s Republic of China (PRC) alone is responsible for over half the global outflows of carbon via trade. The econometric estimations—which focused on a panel of 20 Asian countries—determined that: (i) trade flows were significant for consumption-based emissions but not for territory-based emissions; and (ii) exports and imports offset each other in that exports lower consumption-based emissions, whereas imports increase them. Hence, all countries should have both an interest and a responsibility to help lower the carbon intensity of energy in countries that are particularly important for global carbon transfers—the PRC and India.

Driving factors of electric carbon productivity change based on regional and sectoral dimensions in China

Nearly 30% of global greenhouse gas emissions are associated with the production of capital goods. Consumption-based emission calculations based on multiregional input-output (MRIO) models allocate emissions occurring in the production of intermediate goods to the final goods produced in an economy. Like intermediate goods, capital goods are used in production processes; yet the emissions associated with their production are not allocated to the industries using them. As a result, the carbon footprint of final consumption as well as emissions embodied in trade are currently underestimated. Here, we address this problem by endogenizing capital transactions in the EXIOBASE global MRIO database, thereby allocating emissions from capital goods to final consumption. We find that endogenizing capital substantially increases the carbon footprint of final consumption (by up to 57% for some countries), and that the gap between production-based and consumption-based emissions increases for most countries. We also find that the global emissions embodied in trade increase by up to 11%, and that current patterns of bilaterally traded emissions are amplified. Furthermore, endogenizing capital leads to a 3-fold increase in the carbon footprint of certain product categories. The results suggest that our approach constitutes an important improvement to current input-output methodology.

Traditional consumption-based greenhouse gas emissions accounting attributed the gap between consumption-based and production-based emissions to international trade. Yet few attempts have analyzed the temporal deviation between current emissions and future consumption, which can be explained through changes in capital stock. Here we develop a dynamic model to incorporate capital stock change in consumption-based accounting. The new model is applied using global data for 1995–2009. Our results show that global emissions embodied in consumption determined by the new model are smaller than those obtained from the traditional model. The emissions embodied in global capital stock increased steadily during the period. However, capital plays very different roles in shaping consumption-based emissions for economies with different development characteristics. As a result, the dynamic model yields similar consumption-based emissions estimation for many developed countries comparing with the traditional model, but it highlights the dynamics of fast-developing countries.

Consumption-Based Accounting of CO2 Emissions in the Sustainable Development Goals Agenda

Assessing Global CO2 Emission Inequality From Consumption Perspective: An Index Decomposition Analysis

ABSTRACTThe normative debate surrounding consumption-based emissions accounting, conceived of as a method for constructing national emissions inventories, is investigated. The focus is to examine whether such accounting would be more just than the current method of production-based accounting. It is argued that there is no good reason to think that consumption-based accounting would be less just, and some reason to think that it would be more just. The consequences of this for the overall question of whether to adopt consumption-based accounting are also investigated.

The metallurgy, nonmetal products and chemical industry sectors (MN&C) are the three major industrial sources of air pollutants in China. Previous studies have focused on calculating emissions from MN&C via production-based accounting and identifying the drivers of MN&C using consumption-based accounting. However, these previous studies did not discuss how the total outputs from MN&C upstream and downstream industries influence air pollutant emissions. In this study, we use a pure backward linkage (PBL) method to quantify emissions from industries upstream of MN&C and to evaluate how the downstream industries drive the outputs of MN&C in China. We find that the emissions from industries upstream of MN&C are generally higher than the production-based emissions of MN&C. In particular, the chemical industry largely increased its contribution to air pollution according to the PBL method. Furthermore, much of upstream emissions of MN&C are embodied in the interregional trade, transferring substantial emissions from the eastern region to inland provinces. Regarding the drivers of MN&C, our results reveal that consumption-based accounting underestimates the importance of many sectors. The outputs of these previously underestimated sectors could maximally cover 80% of metallurgy, 85% of nonmetal products and 25% of chemical industry outputs. We suggest that improving the structure of MN&C would considerably help decrease the environmental burden on the entire supply chain. Additionally, improving the productivities of MN&C downstream industries could also address the air pollution caused by MN&C.

Greenhouse gas emissions embodied in trade is a growing concern for the international community. Multiple studies have highlighted drawbacks in the territorial and production-based accounting of greenhouse gas emissions because it neglects emissions from the consumption of goods in trade. This creates weak carbon leakage and complicates international agreements on emissions regulations. Therefore, we estimated consumption-based emissions using input-output analysis and life cycle assessment to calculate the greenhouse gas emissions hidden in meat and dairy products in Hong Kong, a city predominately reliant on imports. We found that emissions solely from meat and dairy consumption were higher than the city’s total greenhouse gas emissions using conventional production-based calculation. This implies that government reports underestimate more than half of the emissions, as 62% of emissions are embodied in international trade. The discrepancy emphasizes the need of transitioning climate targets and policy to consumption-based accounting. Furthermore, we have shown that dietary change from a meat-heavy diet to a diet in accordance with governmental nutrition guidelines could achieve a 67% reduction in livestock-related emissions, allowing Hong Kong to achieve the Paris Agreement targets for 2030. Consequently, we concluded that consumption-based accounting for greenhouse gas emissions is crucial to target the areas where emissions reduction is realistically achievable, especially for import-reliant cities like Hong Kong.

Technology-adjusted national carbon accounting for a greener trade pattern

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Consumption-based versus production-based accounting of CO2 emissions: Is there evidence for carbon leakage?

ABSTRACTInternational trade leads to emissions burden shifting and threatens mitigation targets. Multiregional input–output (MRIO) and bilateral trade input–output (BTIO) models are widely used to analyse emissions embodied in trade and global value chains. Especially, the last one is used in analysing border tax adjustment (BTA) on the carbon content of imports. The model choice is not trivial. The analysis shows BTIO's inability to capture the consumer-principle throughout the production chain and its inadequacy as an option for consumption-based accounting, because it allocates emissions to the first importing country and to the sector of production, instead to the consumer (both country and region). Regarding the BTA assessment, BTIO tax domestic carbon content of direct imports, but not indirect imported carbon content. MRIO does provide incentives for mitigation in third countries. The differences in allocation of emissions and taxes’ burden of both models have different consequences for developed and undeveloped regions.

Austria’s consumption-based greenhouse gas emissions: Identifying sectoral sources and destinations

Understanding the energy metabolism of World economies through the joint use of Production- and Consumption-based energy accountings