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Can we decouple out of the climate crisis?

COMMENTARY: Carbon dioxide emissions from fossil fuels and industry flattened in the last few years, and many argue we are now decoupling emissions from economic growth. Is this a success story or an unfortunate use of the concept?

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I was involved in a nice infographic on The Great Decoupling, based on a paper we published in Nature Climate Change on tracking progress in the Paris Agreement.

I always squirm a little when I hear the term “decoupling”, so I thought it would be useful to explain decoupling and why it can be misleading.

Definitions are important

Relative decoupling happens when emissions per unit economic activity go down, each dollar of economic activity requires less emissions. Relative decoupling is the norm, it happens almost everywhere, and is a consequence of the steady upward march of economic growth, and its relationship with productivity growth (efficiency gains) and structural change (more services).

Absolute decoupling is when emissions go down, while the economy grows. This is currently happening in many developed countries. Absolute decoupling is a subset of relative decoupling, and it indicates emissions are declining.

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Most countries experience relative decoupling, as does the world. Emissions can grow strongly with relative decoupling (China, India, globally) and emissions can peak and decline with relative decoupling (US and EU).

Constant emission intensity declines of 2% per year

If emission intensity declines are constant at 2% per year, we always have relative decoupling, then the economic activity (GDP) will determine the emissions. The numbers in the following list refer to specific lines in the following figure.

  1. If the GDP grows at 4% per year then emissions grow at 2% per year. Above this line (red area) we still have relative decoupling, but we have strong emission growth.
  2. If the GDP grows at 2% per year, then the emissions will be flat. This means that growth in GDP is balanced with improvements in emission intensity, the situation we have today! For GDP growth between 2% per year and 4% per year (yellow area), emission will grow between 0% per year and 2% per year. We have relative, but not absolute decoupling.
  3. If the GDP growth is 0% per year (no growth), then we have declining emissions. If the GDP grows between 0% per year and 2% per year (green region), then emissions decline at between 0% per year and 2% per year. This is relative and absolute decoupling.
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The coloured regions show the type of coupling for a fixed 2% per year declines in emission intensity while varying GDP growth.

What does this all mean in the real world?

The examples are somewhat abstract, but represent typical numbers in the real world.

The Kaya Identity shows the empirical trade-off between economic (GDP) growth and emission reductions. The higher your GDP growth, the harder it is to reduce emissions (for a given relative decoupling). The higher your emission reductions, the harder it is to grow the economy (for a given relative decoupling). The trade-off can be reduced, by increasing the relative decoupling.

What is happening in the real world?

Using this approach, we can look at the recent slowdown in global CO2 emissions using the Kaya Identity in the following figure.

Carbon dioxide emissions have been growing the last decades because GDP growth (green) has exceeded the relative decoupling from declines in emission intensity (purple), apart from the global financial crisis.

In the last three years, we have had lower GDP growth (green) compared to the last decade (except the financial crisis) and a return to stronger relative decoupling (purple), and combined, this has helped lower emissions growth.

We now have near zero growth in emissions, meaning that the growth in GDP is balanced by the declines in emission intensity.

If the global economy grew at 5% per year as in the 2000’s, then emissions would still be growing today (all else equal).

It is important to remember the role that weaker GDP growth has played in the current slowdown in emissions growth, even though we have had some positive progress on relative decoupling.

I have a much more detailed discussion on recent changes in emissions here, including discuss on key countries.

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What is causing global emissions to change? GDP growth (green) has been a little slower in the last few years compared to the 2000’s, but the emission intensity (purple) has also declined at a higher rate (though, not a record high), and both factors lead to the current flattening in CO2 emissions.

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