The decoupling myth
Many prominent climate advocates put forward the idea that we need to decouple emissions from economic growth and that by doing so we can continue to enjoy the fruits of growth. This same argument is applied more broadly to environmental issues – that through efficiency we can keep growing the economy but with much lower material intensity. Is this possible?
An excellent study on this topic was published in 2009 by the UK government’s Sustainable Development Commission, “Prosperity Without Growth?”, led by Professor Tim Jackson, who recently visited Australia. It is an outstanding summary of all the issues around growth but is particularly clear on the question of decoupling.
The report presents scenarios through to 2050, using just the challenge of decoupling economic growth from CO2 emissions if we're to achieve 450ppm of CO2 concentrations. Keep in mind reading these numbers that many scientists regard 450ppm as a quite inadequate a target, so the actual challenge is much greater than that expressed here.
It should also be noted that CO2 is one of the easiest decoupling challenges, because energy can be produced with no CO2, whereas making cars without metals or plastics, for example, would be rather more difficult.
The study used the measure of grams of CO2 emissions per dollar of economic output to compare across the scenarios. In 2007 this measure was 768g of CO2 per dollar globally. They give four potential scenarios going forward to show the scale of change required in this, the easiest decoupling challenge:
1. Under the mid-range forecast of nine billion people and assuming economic growth continues on as it has since 1990 at 1.4 per cent per annum, we would require CO2/$ to decrease from 768g CO2/$ today to 36g CO2/$ in 2050, representing a 95 per cent reduction.
2. With the upper forecast of 11 billion people it would require a reduction to 30g CO2/$.
3. If we assume that we deal with poverty and have 9 billion people in 2050 at a per capita income equivalent to the EU in 2007 (ie. no further per capita growth in the west) the target drops to 14 g CO2/$.
4. If we assume every country is broadly equal and the standard of living is based on the EU in 2007 but grows globally at just 2 per cent per year, then we need to achieve a reduction from 768g/$ to 6 g/$, or a reduction of around 99.2 per cent.
There are a few key lessons from these numbers.
Firstly they strongly reinforce that population growth, while material, is not the key driver of the problem, compared to per capita economic growth.
Secondly they show that the scale of change required is quite extraordinary. Even scenario 3, with mid-range population and equal incomes with no further growth in the developed world, requires an improvement in efficiency of 9 per cent every year for 40 years and results in an economy six times as large as today’s!
Thirdly, and most importantly, this is just the herculean task required to achieve action on climate with a growth economy. That is clearly the easiest challenge, compared to finding the forest, land, fish, food, transport, minerals and water to feed an economy six times the size of today's.
Further complicating this strategy is what is known as the rebound effect. What happens when products become more efficient is that we use more of them. So as cars become more fuel efficient through better engine technology we make our cars heavier; as home appliances become more efficient in power use we buy bigger ones; as air-conditioning becomes more efficient and therefore cheaper, we air-condition more homes.
This means that, as long as we only consider technology, rather than also considering per capita consumption, we’ll keep bouncing back and hitting the limits again.
So, as the report itself concludes: "The truth is that there is as yet no credible, socially-just, ecologically-sustainable scenario of continually growing incomes for a world of nine billion people. In this context, simplistic assumptions that capitalism’s propensity for efficiency will allow us to stabilise the climate or protect against resource scarcity are nothing short of delusional.
“Those who promote decoupling as an escape route from the dilemma of growth need to take a closer look at the historical evidence – and at the basic arithmetic of growth. Resource efficiency, renewable energy and reductions in material throughput all have a vital role to play in ensuring the sustainability of economic activity. But the analysis in this chapter suggests that it is entirely fanciful to suppose that ‘deep’ emission and resource cuts can be achieved without confronting the structure of market economies.”
Of course you won’t hear any of this from our political leaders, indeed you’re not likely to hear it from leading environmentalists either. We have become so addicted to growth and so reliant upon it for political stability that it is currently heresy to question it. But have no doubt, the laws of physics still apply – even when the consequences are uncomfortable. This means the growth issue will come to the fore in due course and when it does, tackling climate change will seem like a walk in the park.
Comments on this article
he decoupling hypothesis is
he decoupling hypothesis is the idea that business cycles in emerging market economies have become more independent of – or decoupled from – business cycles in advanced economies in recent years. Proponents of the decoupling hypothesis argue that emerging markets have achieved stronger growth in domestic demand, lowering the relative contribution of net exports to economic growth. Emerging markets have allegedly also managed to strengthen domestic policy frameworks and reduce external vulnerabilities, thereby increasing the scope for counter-cyclical policies to mitigate the impact of external shocks. Together, these developments would imply that emerging markets have decoupled from advanced economies.
cell phone spy
it is like you said... just a
it is like you said... just a myth, but you should post more often this kind of articles.office cleaning Calgary
for the decoupling myth
for the decoupling myth carbon dioxide is one of the cause for economic growth. best LG appliances
ya it is possible, the
ya it is possible, the economy growth depends upon the decoupling myth.
http://www.samsungrefrigerator.org/
The Economics/Energy Nexus
Graham Palmer puts his finger on the basic dilemma: Instead of preserving our "energy efficiency dividend", we spend it, thereby maintaining energy consumption levels.
The International Energy Agency used to publish "average energy intensity" (AEI) charts that we most informative, but appear to have stopped in their latest annual report. Essentially, AEI is the average energy used per dollar of GNP of a country. It tends to reduce by about 2% per year, as we get clever at doing things- it's really the same as Robert Solow's productivity gains.
However, not only do we spend that 2% dividend, we have increasing populations-also about 2%, so the GNP increases (in most years ) even if the GNP/capita is constant. Hence an increase of 2%/year in energy consumption.
Because spending money means consuming goods and services that require energy, the only practical way to reduce energy consumption (without a global ETS) is for the Government to run surpluses and stop credit expansion. If a 1% surplus (inflation adjusted) was achieved, people could still enjoy a standard of living growth of about 1%.
The issues of net energy analysis and AEI are rarely talked about by economists- I doubt that they understand them. Until they do, we will have pie-eyed ideas to right and left about how to reduce energy consumption by actually increasing it.
A dose of elemenatry physics would help.
Economic realities - response
Remy Maassen
Congratulations on your progress in energy efficiency and your contribution to grid-connected energy supply. And you make an excellent point that many low-cost opportunities exist for achieving improved energy efficiency at a local scale. But your endeavours mask two fundamental challenges. Firstly, your household electricity consumption is only a small fraction of your total energy needs - what about the food you consume (fertilisers, farm equipment, refrigeration, supermarket, etc.) and the myriad of other products and services you consume in your daily life, every one of which consumes energy in some form.
And secondly, long term historical trends since the industrial revolution show that aggregate energy consumption continues to increase despite improvements in efficiency, and the reason is clear : improvements in efficiency give us more money to purchase even more goods consuming even more energy. You may already have sufficient affluence to have chosen to live a more frugal lifestyle, but I suspect you would be a minority among the 6.9 billion of us currently inhabiting the planet, many of whom would like the choice to at least have affordable, reliable electricity in their home.
The Base Load Problem
I recently read an article where the author pointed out that the economics of base load power stations really suffers if renewable unreliable generators such as wind farms and solar stations are in the network.
Even if fast adjusting stations, such as gas are in the network the rapid changes are still reflected onto the base load stations and the reason is the requirement that the renewables get priority to supply the network. This it appears causes of a significant additional increase in the cost of electricity.
Economic Realities
I don't know what an unrealistic rate of energy efficiency improvement is. All I know is that in our household we have reduced our electric power use to 25% of the national average (per person in a household). As we work from home, this includes the electric power we use to earn a living. Achieving this result was easy and it hasn't affected our levels of comfort. The small investments we made in energy-saving technology are showing an excellent return.
I also don't know why renewable energy would be a fantasy. All I know is that in our household we already generate 4 times more renewable electric power than we use ourselves. For the time being this power is fed back into the grid. At some point in the not-too-distant future this excess power will be used to fuel our transportation needs.
Nor do I know which dreams one should remain wedded to in order to avoid making progress. All I know is that energy efficiency, renewable energy generation, and energy self-sufficiency are completely achievable goals at the household and small-business level. It only requires the decision to take responsibility for your own energy future.
But I do know what a totally uneconomic fantasy is. That is when you keep treating your externalities as priceless. It is the oldest trick in the costings arsenal and the surest way to offload costs to the taxpayer. History shows that externalities in the shape of environmental damage are always first denied. History also shows that the longer these externalities are denied, the greater the ultimate cost to the taxpayer (in financial terms) and to the general public (in terms of health and quality of life). So boring to see history constantly repeating itself. So boring to see people trying to replace the hidden costs of carbon with the hidden costs of nuclear.
'Prosperity Without Growth' by Professor Tim Jackson
I highly recommend reading 'Prosperity Without Growth' by Professor Tim Jackson . He is both an economist and mathematician. In this book, he credibly quantifies how the title can be achieved.
You can read the same concepts and conclusions without the maths and means to achieve it from books by Richard Heinberg, Bill McKibben, Ian Lowe, Clive Hamilton, James Hansen , Ross Gittins, David Wann, et al.
The bottom line is that infinite growth is not sustainable in a finite world. We either learn how to adapt or eventually 'Collapse' a la Jared Diamond.
Tim Jackson provides an introduction for conventional economists how the change from infinite growth can be accomplished. Considering it challenges one of the fundamental foundations in Global Economy theory, it will take time to gain acceptance. Hopefully not too long.
Paul is right. This is where we have to go as fast as the concept can be communicated, so that people can understand and accept it......../Chris
Re: Energy Mix
Ronald Mitchell,
You seem to not realise that renewble energy such as wind and solar power supply about 1% of our energy and are hugely expensive. They are only being built because of massive taxpayer funded subsidies.
The wider deployment you refer to is purely a symbolic gesture to appease those who demand them, irrespective of the adverse consequences of such policies to society.
You also seem to not realise that wind power does not reduce emissions.
http://www.masterresource.org/2010/06/subsidizing-co2-emissions/#more-10349
It is an enormously expensive sop to those who believe renewable energy will change the climate.
Energy Mix
@ Bob Lang - Bob you seem to forget (or choose to ignore) that the rest of the world is embracing mechansims to assist in the wider deployment of renewable & clean energy technologies (to diversify supply as well as reduce emissions) yet you seem to think the World's problems will be solved by simply going nuke everywhere....not going to happen unfortunately!
Decoupling
It is a dangerous myth that energy can be produced without carbon. Given that non-carbon energy only comprises about 10% of all energy used, then one can infer that nuclear, solar, wind and geothermal (and carbon) infrastructure are mainly comprised of carbon-based materials. Only when these energy sources entirely reproduce themselves from their own energy without any carbon inputs (and also have an energy surplus to make other things), then we can say that they are carbon-free.
Until decision makers realise this fact, then we will have gross errors made regarding our energy futures.
While we remain anti-nuclear we are going nowhere
The first 16 minutes of this video makes the case why we need to allow clean electricity to be lower cost than dirty electricity, rather than raise the cost of dirty electricity.
http://www.youtube.com/watch?v=VgKfS74hVvQ&feature=channel
As long as we remain wedded to all the totally uneconomic, but emotionally attractive fantacies, like renewable energy, unrealistic rates of energy efficiency improvement and other such dreams, we will contine to make little progress - just as we've done for the past 20+ years in Australia. Nothing has changed since the days of Bob Hawke and "Ecologically Sustainable Development". All the rhetoric and all the anti-nuclear, pro-renewable. energy efficiency policies are the same.
Where to now?
From these rather sobering figures it would appear that every conservation effort is totally pointless and irrelevant - similar to throwing deckchairs off the Titanic.
Maybe the only thing that can save us from ourselves is some cataclysmic event that hugely reduces the earth's population. Electric cars, windfarms and biodegradable plastic bags just won't do it.
Decoupling
However, there can be continued growth that is not strictly material in nature; growth focused on services. More entertainment, more creative food, more physiotherapists, increased use of national parks. This has already happened and is continuing to occur. We have a much more service-based economy than one based on consumption of goods compared to 50 or 100 years ago. The market will help achieve this switch: material scarcity will force up prices of steel, plastics, etc and we'll re-allocate our spending accordingly. As a society, we just need to properly recognize and price the externalities.