A new report published this week by the OECD has concluded that, while many countries are making progress on environmental productivity in terms of carbon, energy, and materials, and the growing consensus that carbon dioxide emissions and fossil fuel use have decoupled from economic growth, progress is still too slow if we are to meet the targets outlined in recent international treaties and commitments.
The Organisation for Economic Co-operation and Development (OECD) is the intergovernmental economic organization representing 35 member countries dedicated to democracy and the market economy. Published on Tuesday, the OECD released its latest Green Growth Indicators report for 2017, which uses a range of indicators that cover everything from a country’s land use to CO2 productivity and innovation, and actually analyzes 46 countries on balancing economic growth with environmental pressures between 1990 and 2015.
Investigating the growing decoupling between economic growth and reliance on fossil fuel and the subsequent energy emissions has been an interesting study over the past few years, as we’ve moved from “it’ll never happen — it’s simply impossible” to “Western countries might be able to manage it, but definitely not emerging economies” all the way to where we currently sit at, “Oh, looks like everyone can with the right policies.” A report from the Energy & Climate Intelligence Unit published earlier this year showed that the United Kingdom has been the most successful G7 nation over the last 25 years at decoupling its economic growth from emissions: in 2014, the last year we currently have enough data for, UK per-capita greenhouse gas emissions were down 33% on 1992 figures, while UK per-capita GDP had grown by more than 130%. Meanwhile, in China — arguably the world’s most emissions-intense economy — the country’s total energy consumption increased by 1.4% in 2016 while its coal consumption declined by 4.7%. Further, China’s national energy consumption per 10,000 yuan worth of GDP dropped a further 5% — following a years-long trend of such decoupling activity.
In fact, academic exercises attempting to disprove the viability of focusing on economic growth and green growth at once have failed to pass muster, as we saw back in February. The reality is simply — economic growth coupled with green growth is not only viable, but economically advantageous.
However, the new OECD report highlights that, while a number of countries are making strong headway, it is simply not yet enough — more so if emissions embodied in international trade are rolled in to the equation, at which point any advances that are seen to be made are made more modest by comparison. Denmark, Estonia, the United Kingdom, Italy, and the Slovak Republic have made the most progress on green growth since 2000, but the OECD report concludes that no country is performing well across the board — often performing well on one or two of necessary green growth metrics, but not the others.
“While there are signs of greening growth, most countries show progress on just one or two fronts and little on the others,” said OECD Environment Director Simon Upton. “We need much greater efforts across the board if we are to safeguard natural assets, reduce our collective environmental footprint and sever the link between growth and environmental pressures.”
The report found that all OECD and G20 countries have made progress on their overall environmentally-adjusted productivity since the 1990s, with half of the 35 OECD member countries decoupling their emissions from economic growth. These are all great things, but when trade flows are factored into the equation, and emissions are considered from the perspective of final demand, the reality becomes much clearer and less impressive. Specifically, the report found that, when CO2 emitted during production stages of goods or services is included, only 12 OECD countries are considered to have successfully decoupled their emissions from GDP.
The full report is available to read here, and it delves deeper into wider issues such as renewable energy growth and share, pollution, and raw materials; however, I thought it important to focus solely on the story behind the decoupling of emissions and economic growth.
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