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The Emissions-Per-Capita Distraction

Contributed by Robert Lyman © 2019

Robert Lyman is an Ottawa energy policy consultant. He was a public servant for 27 years and a diplomat for 10 years prior to that.

In the debate between those who claim that Canadians must dramatically transform their energy economy to reduce greenhouse gas emissions and those who oppose them on scientific and policy grounds, the advocates of transformation like to play the “morality” card. They insist that, even though Canada produces only 1.6% of global greenhouse gas (GHG) emissions, its per-capita emissions are among the highest in the world. The implication is supposed to be that, as a matter of equity, Canadians should join in the global movement to reduce emissions along with those whose per capita emissions are lower.

Let’s examine the facts.

The concept of “equity” derives from a political theory that maintains that people within a democratic country  should have equal rights before the law, and therefore be treated fairly when accused of a crime or involved in a dispute. An extension of this concept into economic theory is that every individual should have an equal opportunity to better himself or herself and not be discriminated against in doing so. Socialism extends the theory further; it holds that, to the extent possible, all citizens within a country should have equal economic benefits regardless of the differences in incomes; that usually translates into heavy government intervention to redistribute income from one group of citizens to others.

In practice, the people in any country or group are all extremely different in terms of their talents, skills, work habits, and ambitions, so they are not equal in terms of their incomes or benefits from government. These differences are magnified in comparisons across countries – some countries have higher incomes because of their natural resources, level of education, degree of industrial and commercial development, and other factors that give their populations income advantages over others.

The GHG emissions in any one country are a function of the economic, geographical, and climatic condition in that country. For example, a country like Albania is small, poor, under-developed, and located in an area with a mild climate. Its emissions per capita in 2014 were 1.98 tonnes per year. Canada, in contrast, is the second largest country in the world, with thousands of kilometres separating the major population centres. It has very large natural resources, including large mineral and petroleum deposits that require significant amounts of energy to extract. It has one of the highest incomes per capita in the world. Finally, it is a northern country with a very cold climate for much of the year. Of course, this results in higher energy use and the result of that is 2014 emissions per capita of 15.1 tonnes per year.

There are other factors that affect emissions from energy use, including prices. The higher the prices, other things equal, the less energy will be consumed. Prices, in turn, are the result of market conditions of supply and demand (or conditions of plenty or scarcity) and the additional costs imposed by government taxes. Canadians traditionally enjoyed the benefits of living in a country with a large resource endowment and consequent conditions of plenty, resulting in low prices. This supported a high standard of living. As  a result, they used more energy.

The idea that Canadians should have lower emissions per capita is based on the idea that all these differences that affect energy supply, demand and prices should be ignored, or worse, offset through governments imposing taxes that raise Canadian energy prices to much higher levels to force Canadians to change their energy consumption habits.

In response to this thesis, one has to ask and answer a few questions:

How large are the differences in energy consumption and GHG emissions per capita among countries today?

 

The World Bank is a good source of information on GHG emissions by country. Unfortunately, the most recent year for which data is available is 2014. The following table shows the emissions per capita for selected countries:

TABLE 1

GHG Emissions per Capita by Country (tonnes) 2014

Country

Emissions

Albania  1.98
Argentina4.75
Australia15.3
Belgium8.3
Canada15.1
China7.5
Germany 8.9
India1.7
Japan9.5
Poland  7.5
Qatar45.4
Russia11.9
USA16.5
World5.0

One should note the extremely wide variations in per capita emissions and the generally high correlation between a country’s level of economic development and its emissions levels.

In which ways are the conditions in the countries of the world now equalized?

The answer to this is obvious. There are no ways in which the countries of the world are equal. It would be a denial of their geographic, economic, political, cultural and climatic conditions to suggest that they should be so. There may be some dreamers who imagine the day when the world will be one country, but today he entire notion of global equality is bizarre.

What, in fact, are the countries of the world to today doing in terms of emissions?

One can illustrate this with two sets of figures. Table 2 shows the total GHG emissions in megatonnes (Mt) by country in 2017, according to the BP Statistical Review of World Energy 2018

TABLE 2

GHG Emissions from Energy Combustion in 2017

Country/RegionEmissions (Mt)
China9,233
USA5,088
India2,344
Russia1,525
Japan1,176
European Union3,542
OECD12,448
Non-OECD20,996
World33,444

These figures show that the largest sources of GHG emissions in the world are not in the wealthy developed countries but rather in the developing countries such as China, India and the non-OECD group. In fact, the non-OECD group of countries represents 63% of the global total.

Table 3 shows the changes in GHG emissions levels by groups of countries over the last decade.

Table 3

Grouping2007 Mt2016 Mt2017 MtGrowth Rate 

2006-2016 (%)

OECD136301239912448-0.8
Non-OECD1644920619209962.9
World3007933018334441.3

The emissions growth from the non-OECD region totaled 4547 Mt, significantly exceeding the emissions decline in the OECD region of 1182 Mt. In fact, non-OECD emissions grew almost four times as fast as OECD emissions declined.

Conclusion

The argument that Canada should reduce its GHG emissions to be more “equitable” is based on a profound misunderstanding of the factors that determine emissions levels in different countries. The concept of equity is no more relevant in considering the differences in emissions levels in other countries than is the notion that all countries should be the same size and income level. If Canada had the same emissions per capita as India, we would all freeze to death and live in tiny dwellings, many without electricity.

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2 Comments

  1. Thank you for this blog post. There appears to be an error in the calculation of the growth rate in Table 3. The emissions are given for 2007, 2016 and 2017, but the growth rate is over the 10-year period 2006-2016. Assuming the growth rate was intended to be calculated from the given annual emissions data, is the first column year mislabeled or is the growth rate period mislabeled? In any case, I calculate the annual average growth rate from 2007-2016 for Non-OECD at 2.54% [(20619/16449)^(1/(2016-2007))-1], significantly less than the 2.9%/year given in the table. (The growth rate 2007-2017 is 2.47%/year.)

    Federal government policy should primarily strive to maximized the benefits to its citizens. The amount of foreign aid, including economic loss via greenhouse gas policy and other UN initiatives should not exceed 3% of the federal revenues.

    Carbon dioxide emissions significantly benefits Canada. Richard Tol’s textbook “Climate Economics” 2014, page 89 says “The best off country is Canada … The impact is positive throughout the 21st century, as are incremental impacts …”, meaning that the net economic impacts of CO2 induced warming is beneficial and those benefits continually increase. Using the FUND economic model which was developed by Richard Tol, professor of economics, University of Sussex, UK, the economic benefit to Canada of greenhouse gas emissions is $100 billion per year by 2100.

  2. Anyone who says Canada’s CO2 emissions per capita are too high should be required to identify what is the right per capita level and how they reached that conclusion.

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