1. An introduction to the concept of consumption based emissions accounting and related policies
Prof. Arnold Tukker,
Project Coordinator, TNO and Leiden University - CML
Addressing consumption-based emissions: the Chinese perspective
Event co-organised by Carbon CAP and the Climate Group, Beijing, 10 November 2015

2. Welcome!

3. Introduction Short overview of Carbon-CAP Some examples of analyses
Conclusions

4. Basics Contract Management From 1 October 2013 to 31 December 2016
3.6 Mio Euro of which 3 Mio EU FP7 funded
Management
Scientific Coordinator, Arnold Tukker, TNO
Project manager, Ming Chen, TNO
EU contact: DG Research (and DG CLIMA)

5. Consortium Project Partners
The Netherlands Organisation for Applied Scientific Research (TNO, co-ordinator) (NL)
Cambridge University Centre for Climate Change Mitigation Research (4CMR) (UK)
Wirtschaftsuniversität Wien (WU) (AU)
Cambridge Econometrics (CE) (UK)
EC DG JRC Institute for Prospective Technical Studies (IPTS) (BE)
Climate Strategies (CS) (UK)
Institute of Environmental Sciences, Leiden University (LU-CML) (NL)
Deutsches Institut für Wirtschaftsforschung (DIW) (DE)
Norges Teknisk-Naturvitenskapelige Universitet NTNU (NO)
International Centre for Trade and Sustainable Development (ICTDS) (CH)

6. Concept Territorial emissions versus consumption based emissions
Sales of products between industries in a country
Trade flows between countries
Final demand by house-holds, and government by country
Carbon emissions by industry sector & country

7. Potential Currently: territorial emission reduction targets
Global economy: growing share of GHG emissions
Consumption is the main driver GHG emissions
We hence need consumption oriented mitigation approaches as a complement to territorial efforts
Address consumption as a driver
Address carbon leakage
By probably more efficient policies

8. Method: input output analysis
Relates production to consumption
Example: 5 Euro coffee at Starbucks
3 Euro for Starbucks = Restaurant
1 Euro for roaster = Food industry
0.5 Euro for transport = Transport
0.25 Euro for farmer = Agriculture
0.25 Euro for fertiliser, etc.
Impacts per sector/country per Euro known
Multiply -> you see how impacts of production relate to consumption
In essence you re-distribute global territorial emissions to consumption

9. Challenge
Consumption – based accounts and policies are new and unknown
Uncertainty in accounting is unknown
Hence not (yet) fit for use in official contexts (UNFCCC, COP)
Indeed: fear that new research on this issue to overcome challenges will block negotiations

10. Main gaps
Gap 1: Can we make consumption-based carbon accounts? With what (un)certainty?
Gap 2: What demand-side carbon options and policies can we identify?
Gap 3: How effective and acceptable are they?
Gap 4: How do we come to a shared view of added value of consumption – based accounts and policies?

11. Work Breakdown

12. Main gaps
Gap 1 (WP4, Multi-regional input output analysis): Can we make consumption-based carbon accounts? With what (un)certainty? [
Gap 2 (WP5, 6: Options and policies): What demand-side carbon options and policies can we identify?
Gap 3 (WP7: environmental & economic modelling of traditional and consumption oriented policy scenarios): How effective and acceptable are they?
Gap 4 (WP2, 8: stakeholder discussions & integrated conclusions): How do we come to a shared view of added value of consumption – based accounts and policies?

13. Multi-regional EE IO database (EXIOBASE) used
Work flow
Multi-regional EE IO database (EXIOBASE) used
Models used:
E3ME (Cambridge)
FIDELIO (DG JRC IPTS)
EXIOMOD (TNO)
We are here…

14. Examples
Territorial and consumption based carbon emissions by continent

15. Examples
Carbon footprint rankings by countr

16. Examples
Carbon embodied in trade

17. Conclusions Carbon CAP sets consumption central
Wants to overcome 4 main gaps
Uncertainty
Understanding of possible policies
Understanding of effectiveness of policies
Creating a common view on usefulness
Via
Analysis with MRIO time series
Identification of policy options
Identification of technical and behavioral options
Assessment of the economic and environmental implications of traditional and consumption oriented policy scenarios via 3 models
Intensive stakeholder interaction

18. Questions so far?

19. Thank you for being here today!