Accounting for carbon at the point of consumption

Prof. John BarrettUniversity of Leeds

October 13th, 2011

Toy Production

Toy Consumption

Scale of Traded Emissions - Global

Source: University of Leeds

Scale of Traded Emissions - National

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 500

600

700

800

900

1,000

1,100

1,200

1,300

Kyoto greenhouse gas basketFull TerritorialConsumerCO

2e (m

t)

Source: University of Leeds

Scale of Traded Emissions - Sector

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

China Japan Ger-many

United

Kingdom

China USA

Russian Federation

ChinaChina

USA

UK

Share of domestic consumption by country of origin of steel

Source: University of Leeds

Global Emissions captured in trading schemes

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

Global emissions EU ETS sectors

Mill

ion

tonn

es C

O2

and

CO

2eq

CO2

Other GHGs

9% of CO2

Source: University of Leeds

CO2 or GHG Emissions

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

Global emissions EU ETS sectors All sectors

Mill

ion

tonn

es C

O2

and

CO

2eq

CO2 Other GHGs

9% of CO2

2% of GHGs

CO2

Other GHGs

14% of CO2

7% of GHGs

Source: University of Leeds

Capturing Carbon in Trade

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

EU ETS Proposed schemes

Direct onsite

imports

Direct imports

Direct onsite

imports and onsite

elec.

Direct imports

and elec

All embedded

Mill

ion

tonn

es C

O2

EU Australia and New Zealand USA Japan and South Korea

30%28% 28% 28%

9%

31%

US 13%

38%

Source: University of Leeds

Best Available Technologies

All embedded; All sectors; source country GHGs

All embedded; All sectors; BATs GHGs

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

Emissions attributed to USA, Japan and South Korea

Emissions attributed to Australia and New Zealand

Emissions attributed to EU

Emissions captured by trading schemes

Source: University of Leeds

What Counts?

• All embodied emissions (8% difference• “Real” emissions, not false assumptions (10% difference)• Inclusion of the US and Japan in domestic schemes (15%

difference)

What doesn’t count • Least developed countries (under 1%)• Full GHG emissions (at least for existing sectors) (under 2%)

Challenges

• Complex carbon accounting system that is robust• Difficulty of border carbon adjustments that would

make a difference

Smaller scheme

Larger scheme

Cooperative

Uncooperative

Smaller uncooperative

All non-LDC material partners, BAT - EU, Existing, Direct, CO2,

Most at risk

Smaller corporative

All non-LDC partners, Real exporter, Existing + proposed,

Direct + electricity, , CO2, Most at risk

Larger uncooperative

All non-LDC material partners, BAT- EU, Existing, Direct power sector, CO2, All

EUETS sectors

Larger co-operative

All non-LDC partners, Real- exporter, Existing + proposed, Embedded (by

sectors), All Kyoto, All sectors