Guest post: The UK’s carbon footprint is at its lowest level for 20 years

§ Carbon footprint

We define the UK’s carbon footprint as the CO2 emissions associated with its consumption, irrespective of where the emissions occur.

The chart below shows this overall footprint (blue line) in comparison to the UK’s standard territorial CO2 emissions (red), for the years 1997 to 2016.

The timeseries for our carbon footprint estimates is relatively short because it relies on a “multiregional input-output database” – a large set of economic figures on domestic and international trade flows. This data takes time to compile so our most recent estimate is for 2016.

Over the 20-year period covered by our estimates, the UK’s overall carbon footprint has fallen by 10%. In contrast, production-based emissions in the UK have fallen twice as fast, by some 20%.

Progress has been relatively slow under either accounting approach, amounting to an annual reduction of just 0.5% or 1% averaged across all 20 years of data.

However, recent years have seen much sharper reductions, with 2012 marking something of a turning point. Since then, domestic emissions have declined by 13% (3% per year) and the UK’s carbon footprint has fallen by 7% (nearly 2% per year). In 2016 alone, the UK’s carbon footprint fell by nearly 6%, marking the fastest decline since the global recession in 2009.

§ Imported emissions

Despite these overall declines in recent years, the UK still imports large amounts of CO2 embodied  in traded goods and services from overseas.

The chart below shows the size of these net imports, which is the difference between domestic emissions and those overseas due to UK consumption.

The chart above shows that net imported emissions were far higher in 2016 than they were 20 years ago. In 1997, net imports amounted to 30m tonnes of CO2 (MtCO2), or just 5% of the UK’s footprint. By 2016, the figure had risen to 122MtCO2 or 20% of the overall total.

Combined with falling domestic CO2 output, this means that the emissions associated with UK consumption are increasingly occurring overseas. (Imported emissions grew steadily to a peak in 2007 before falling rapidly after the global financial crisis. They have yet to match that peak.)

Moreover, goods and services imported into the UK are more “carbon intensive” than those produced domestically, meaning they come with higher CO2 emissions per unit of economic output. While the carbon intensity of both domestic and imported goods and services is falling, the decline has been faster for UK production mainly due to its rapidly decarbonising electricity system.

§ Climate goals

The UK’s shrinking carbon footprint is encouraging, but must be compared to the pace of reductions required to meet the goals of the Paris Agreement on climate change. Global emissions will have to fall to net zero by around 2050 if warming is to be limited to 1.5C above pre-industrial temperatures, according to the recent Intergovernmental Panel on Climate Change special report.

The UK would have to cut its emissions by at least 8% each year if it were to follow a linear path to net-zero emissions by 2050, ignoring the fact that it should arguably be doing more than other countries. Against this measure, recent cuts in the UK’s carbon footprint clearly fall short.

The scale of the task ahead makes it essential that we continue to monitor the UK’s overall carbon footprint, alongside the standard accounts based on domestic emissions alone.

One of the key reasons for this is to ensure that the UK does not achieve cuts by offshoring carbon-intensive production and then importing the same goods from overseas: the UK’s contribution to climate change is determined by its overall carbon footprint.

Another reason to monitor this footprint is that it helps us understand the full potential of the policy interventions available to government. Some policies would see most of their impact in cutting emissions outside the UK, yet they should not be ignored.

Resource efficiency is one example that would help cut the UK’s carbon footprint, but would need to be implemented both inside and outside the country. If we were to look only at domestic emissions in the UK, the potential of such an intervention would likely be underestimated.

Monitoring the UK’s carbon footprint might also help avoid perverse incentives that cut CO2 in the UK, while creating even larger emissions elsewhere.

§ Uncertain estimates

There are many good reasons to continue to measure the UK’s consumption-based contribution to climate change, but this is not without challenges and uncertainty.

Put simply, our estimates look at the goods and services traded between the UK and other countries, as well as the emissions associated with their production. This requires detailed information on the types and volumes of international trade flows, along with estimates of the output and related CO2 emissions from each part of the economy around the world.

The chart below shows how our latest estimates (red line) compare with releases from 2011 through 2018 (shades of blue). All eight datasets show similar increases in the UK’s carbon footprint between 1997 and 2007, followed by declines after the financial crisis.

Our estimates have varied over time as our method has been gradually refined, as the chart above shows. However, the 2019 figures align very closely to those published in 2018, meaning we are approaching a “stable” method for estimating the UK’s carbon footprint.

Our latest approach (thick red line) also better matches estimates of consumption-based emissions in the UK made by other groups (other colours), as the chart below shows.

The differences shown in the chart, above, highlight the fact that there is always an element of uncertainty in estimating consumption-based emissions. This stems from the use of “multiregional input-output (MRIO) models” to calculate consumption-based accounts.

There are three distinct areas of uncertainty in the use of MRIO models. First, there is uncertainty in the source data. Second, there is uncertainty due to the choice of model structure. Third, the modeller can introduce uncertainty through choices on how to deal with conflicting data.

We attempt to limit uncertainty by using data from the Office for National Statistics (ONS), which carries out multiple checks and revisions. While it does not publish “confidence intervals” for each datapoint, taking data from this official UK source remains the most accurate approach.

Despite the challenges and uncertainties in estimating the UK’s consumption-based carbon footprint, this work remains an important complement to standard CO2 accounting as countries around the world target net-zero emissions to limit the worst effects of climate change.