China’s ‘carbon intensity’ commitment means nothing

Molly Scott Cato

15th October, 2009

There’s been plenty of excitement over China and India’s pledges to reduce the ‘carbon intensity’ of their economies. But without absolute limits, this is just business as usual

As we get closer to the climate-change negotiations in Copenhagen in December you can expect to hear a great deal more about carbon intensity. At the pre-meeting in New York in September, President Hu Jintao of China committed his nation to ‘continue its unremitting endeavours in boosting energy efficiency and by 2020, we should try to achieve a significant cut of carbon dioxide emissions per unit of gross domestic product’.

The flurry of excitement that greeted this announcement was not shared by ecologists or green economists. All Hu was really promising was that China’s massive industrial production would be achieved with relatively less production of CO2, thus increasing ‘carbon intensity’ rather than reducing carbon emissions. This carbon intensity will be calculated as a ratio of emissions to GDP output (a notoriously unhelpful measure of economic activity), and is only relative to the inefficient nature of China’s current production. So all that has really been promised is an attempt to move towards more ‘renewable’ energy sources, which include nuclear power.

How likely are we to achieve the sorts of improvements in carbon intensity that will allow us to maintain current consumption standards while making the CO2 cuts the planet needs? Adam Barnes has calculated that, taking population growth into account, merely to keep emissions stable the carbon intensity of our productive systems must fall by 66 per cent.

If we build in the need for even a modest 60 per cent cut in emissions, and extrapolate from our current trajectories to assume a population increase of 50 per cent and a doubling of per capita GDP then we are looking at the need for emissions per unit of GDP to fall by 86.8 per cent over the next 40 years.

Even if we could achieve a fraction of this greater efficiency, what would we get for our energy? While we persist in measuring economic output in monetary terms the incentive for other economies is to follow the UK-US route and rely on ‘invisible’ earnings that do not require fossil fuel burning to create value — international insurance and banking services for example. So China’s commitment could boil down to nothing more than a threat to compete with Britain for the diminishing world demand for such services.

What this means is that both sides of the ratio that generates the measure of carbon efficiency are flawed. On the one hand we have the relative reduction which really means an absolute increase — some kind of Faustian pact with a planet which, as the climate campers blazoned across their banners, doesn’t do bailouts. On the other hand we have a measure of economic value – GDP – that has nothing to do with what we, as humans, value and only respects the accountant’s yardstick of financial return.

What we need is a genuine indicator of the carbon efficiency of an economy — let’s call it a Responsible Carbon Index. It should take into account the emissions already embedded in the goods we consume but that are produced overseas; it should be measured in terms of absolute carbon emissions rather than relative ones; and it should relate to something we actually value, like human well-being, or species diversity, or some combination of such measures. A single-number index is always good — it works for the journalists — and once we have this in place environmental campaigners could use it to browbeat their national politicians to try to outperform Burkina-Faso or Laos on climate responsibility, rather than competing with China or the US on some arcane monetary measure of the production of pointless and destructive stuff.

The media is full of talk of cuts this autumn, but please excuse me if I fail to get excited until I hear about the sorts of cuts that will give half of the humans alive on the planet today a chance of seeing out their natural span of life.