A new conversation for business.
In the second installation on the State of Green Business 2008 report from GreenBiz.com, I'd like to bring our attention to an interesting recent trend - a drop in national carbon intensity and slower growth of overall CO2 emissions. This is great news, right? Let's break out the locally-grown wine and celebrate! But wait....to what can we attribute these recent trends? And is "slow growth" just as good as "no growth" in CO2 emissions?
Carbon intensity (measured in CO2 emissions per unit of GDP) has dropped almost 28 percent since 1990. However, "overall emissions rose through 2005...due to economic growth, before their slight decline in 2006." How slight of a decline are we talking about here? 1.5%. This modest decline is accounted for by a drop in energy consumption, "due in part to favorable weather conditions requiring less heating and cooling," higher energy prices, and an modest use of renewable energy. Future projections based on steady national economic growth show that overall carbon emissions will continue to rise, albeit at a slower rate, to 34% over 2006 levels by 2030.
This section of the report concludes, "Carbon intensity is misleading...While it represents improvement of sorts, it often obscures the fact that overall carbon emissions need to decrease significantly, not grow more slowly, in order to avoid what a consensus of scientists predict will be the worst impacts of climate change."
Given that the industrial and commercial sector represent over 50% of total CO2 emissions, it is ever more imperative that we begin to ponder the paradox - is it possible to pursue economic growth while decreasing overall CO2 emissions?
Good post Shannon. I've always felt that measuring "carbon intensity" as misleading. It is the actual carbon emission that is important. Not carbon as a ratio to some other criteria.
Good post Shannon. I've always felt that measuring "carbon intensity" as misleading. It is the actual carbon emission that is important. Not carbon as a ratio to some other criteria.
I agree 100% with your analysis. Measuring energy usage, emissions, water usage, etc. by GDP is unacceptable for a number of reasons:
1) As long as I make a wastefull widget with a short lifespan designed to be landfilled,I am contributing to the GDP. The efficiency (both energy and CO2 emissions)of my creation of the widget may be better than last year, but the widget is still a wastefull unnecessary product.
2) Growth has limits defined by resources. Continual growth only dimenishes these resources, even if humans become more efficient with them. A LEED certified mansion could use only small amount of energy per square foot and yet the owners only use 4-5 rooms 90% of the time and the other 30 rooms are used 10% of time. The efficiency of energy usage is masked by the size of the building. It is the initial wastful building itself that is forgotten or lost by through the use of square feet.
3)GDP is related to Capital, not Natural Capital. Capital depends on Natural Capital to exist and yet the replacement or sustainable procurement of the Natural Capital is not tracked or even of concern. How can growth continue with the decline of Natural Capital?
Replace GDP with Planet because that is an inarguable boundary, then let us talk about the state of the world, not of business. Without the world, business doesn't exist.
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