Overconsumption is one of the greatest drivers of resource use and environmental degradation globally. If SA continues on the carbon-intensive path of its economy, the wealthier it becomes as a nation the higher its emissions are likely to be.
Considering that consumerist behaviour and lifestyles of developed countries are emulated by elites and the middle class in the developing world, ways of enjoying a higher standard of living decoupled from carbon clearly need to be found. Consumption-based carbon accounting offers insights and a tool to drive this quest.
The carbon footprint of some of the world’s biggest cities may be 60% larger than previously estimated, according to a report released at the Intergovernmental Panel on Climate Change’s Cities and Climate Change Science Conference earlier in 2018.
The report’s author, Michael Doust, programme director at C40 Cities, cautioned, "We’re missing the other side of the coin if we only measure emissions involved in the production of food, energy, or other products and services. Knowing what the consumption emissions are, and where, allows cities and residents to make better decisions on how to reduce their carbon emissions," he said.
Richer countries can be expected to take on the greater burden for the reduction in emissions given that they bear most responsibility for higher past emissions and that they have the greatest capacity to solve the problem
Measures that stabilise or reduce consumption stimulate behavioural changes, apart from perhaps facilitating the transition towards collaborative consumption, and have high mitigation potential. Climate policy and mitigation initiatives have been concerned, however, with direct emission levels and emission patterns from producing goods and services, rather than the emissions resulting from their consumption. This is not only about household consumption, but also intermediate consumption along the value chain, in which companies buy goods and services.
Internationally, the allocation of responsibility for reducing carbon emissions is based on the production-based accounting method. This measures the emissions generated at the place where the goods and services are produced. In the case of a car as a product, for example, emissions are measured at the point where the car is made, even if it is exported and sold elsewhere. But reports like the one produced by C40 Cities are increasingly highlighting the question of whether production-based accounting should be complemented by other accounting approaches for a more accurate overview. Consumption-based accounting uncovers emissions at the point of consumption, attributing all the emissions that occurred during production and distribution to the consumers of the good or service. In the case of the car, the emissions would be attributed at the location of the sale of the vehicle.
At a global level, consumption and production carbon accounting are two sides of the same coin. Under both systems, total emissions remain the same and go into one global atmosphere, but they are allocated in a different manner.
A World Wildlife Fund SA paper, Chewing Over Consumption-based Carbon Emissions Accounting, suggests that a consumption-based approach provides a different window into causes of emissions and extends the range of mitigation options. The government, companies, households and society may benefit in a variety of ways.
For one thing, consumption-based accounting offers valuable insights into the extent to which carbon leakage may occur between countries, and helps to manage it. Carbon leakage refers to the practice of relocating high-emitting production or manufacturing plants to another country where the costs of producing emissions are lower and importing the finished carbon-intensive products back into the original country.
Related to carbon leakage is carbon outsourcing, which is the relocation of carbon-intensive domestic production typically to a developing country, resulting in a reduction in the outsourcing country’s own emissions and an increase in the developing country’s emissions.
Measures that are derived from consumption-based carbon accounting have the potential to target high emitters, while ensuring that the burden is not placed on low-income groups
The Kyoto Protocol of the UN Framework Convention on Climate Change required developed countries to cut emissions by specified amounts and allowed developing countries to participate voluntarily through the clean development mechanism. Developed countries could therefore reduce their own emissions through carbon outsourcing and carbon leakage. These approaches have become the dominant mode of emissions reduction by many developed countries and have resulted in increasing emissions in developing ones.
While under the convention’s Paris Agreement all countries take aim at emission reduction targets they set themselves, this practice is likely to continue as developed countries struggle to meet their commitments.
Richer countries can be expected to take on the greater burden for the reduction in emissions given that they bear most responsibility for higher past emissions and that they have the greatest capacity to solve the problem. They are also better able to reduce emissions without unduly or excessively affecting their people’s welfare.
However, production-based accounting has enabled significant loopholes allowing countries to appear to have reduced their emissions without any real difference in global emissions.
Research shows that from 1990 to 2008, using consumption carbon accounting and including imports, the UK’s carbon emissions have, in fact, increased by 20%, rather than declined as the country had been able to show using the production approach.
More recent estimates suggest that production in other countries accounts for 31% of Australia’s and more than 50% of the UK’s and France’s carbon footprint. By the same measure, one estimate suggests that about 30% of China’s emissions are produced on behalf of consumers in other countries.
A consumption-based perspective encourages fairer allocation of emissions embodied in global trade. It avoids the problem of carbon outsourcing and leakage as it captures emissions associated with the global trade of goods and services by allocating emissions to consuming countries. Unlike production carbon accounting, it does not disproportionately penalise countries with base-metal industries that by their nature are carbon-intensive and are often located in developing and emerging countries. One example is the aluminium smelters in SA. These metals are needed worldwide, but under production-based accounting, the emissions are allocated to SA.
The unsustainable consumption practices of the affluent, with burgeoning aspirations to such lifestyles in which products are still carbon intensive, are putting increasing pressure on environmental systems.
Measures that are derived from consumption-based carbon accounting have the potential to target high emitters, while ensuring that the burden is not placed on low-income groups who make low or negligible contributions to emissions.
While consumption-based carbon accounting is not a panacea for climate change mitigation and can also not replace the production-based carbon accounting required for national greenhouse gas inventories and the Paris Agreement, it should be very seriously considered as a complementary tool that can yield a number of compelling benefits, especially that of addressing the unsustainability of consumption patterns in wealthier nations.
• Chewing Over Consumption-based Carbon Emissions Accounting was funded by the International Climate Initiative of the federal ministry for the environment of Germany. The paper can be accessed here.
• Naudé is low-carbon frameworks programme manager at WWF SA.
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