The information below will, it is hoped, provide useful background for the "Low-Carbon Headington" meeting on April 23rd.
The chart below shows average greenhouse gas emissions, in metric tons of carbon dioxide equivalent per year, per household in the UK. (The source is the environmental accounts prepared by the Office for National Statistics).
The first two items - heating/cooking and using personal vehicles - are cases in which the emissions are done directly by the household. The third is the use of electricity, where the emissions are done in the process of generating the electricity used in the household. The 1.97 tons of greenhouse gases shown against electricity corresponds just to the 29% of electricity that is directly used in the household. The remainder of the electricity is used indirectly when we buy goods and services that used electricity to be made, and is shown as part of "manufactures" or "services". Electricity generation in total (i.e. adding the electricity used directly by households to that used by industries) accounts for nearly a quarter of our emissions.
The next chart shows how the rate at which we are currently putting carbon dioxide into the atmosphere compares with some other countries (it shows only carbon dioxide, which is the most important though not the most potent greenhouse gas, and is expressed per person, not per household). It can be seen that, despite the rapid growth of the Chinese and Indian economies, their emissions are still much lower in relation to their population, and that European countries are intermediate between them and the USA. We should also bear in mind that climate change depends on the stock of greenhouse gases that have been put in the atmosphere since the industrial revolution began, and not on the annual flow. Recently industrialised countries such as China are responsible for only a small part of that stock. The countries that have been industrialised longest are the main causes of the problem to date, so it is reasonable to expect them to take the initiative in solving it - even though eventually any solution must include China and India.
The third chart below shows the volume of carbon dioxide generated in different countries per million pounds of income. On this measure too, the USA is the most profligate emitter of the developed countries, but it is clear that there is a great deal of scope for improving the efficiency of fuel use in lower-income countries. The countries that fare worst on this measure generally have a high proportion of electricity generated by coal. In the UK, one-third of electricity comes from coal, but that one-third is responsible for two-thirds of the carbon emissions from electricity generation. France fares relatively well on both measures, mainly because of its large nuclear electricity industry, but in part also because of the high proportion of more fuel-efficient diesel vehicles. Countries such as Japan, Germany and China, which export large volumes of manufactured goods, are somewhat over-represented on both of these measures, since a large part of their emissions are generated in making products which will be consumed elsewhere. The US and the UK, with very large trade deficits, are less efficient than the chart implies.
What is the cost that we are imposing on future generations by these emissions? Sir Nicholas Stern's estimate, in the review commissioned by Gordon Brown a couple of years ago, which is controversial - many economists think it too high - but in my view the most plausible, came in at about £45 per ton of CO2. (He actually expressed it as $80, but I have converted it at the exchange rate when he wrote. He himself now believes this figure is an underestimate). On this basis, the damage that the average UK household is doing to future generations with its 27 tons of CO2 equivalent emissions can be put at about £1,200 per year. The current price for CO2 on the European exchange is just £18 - about 40% of Europe's carbon emissions are done by industries, such as electricity, which have their carbon allowance capped. If they use more than they are permitted, they must buy extra allowances on this exchange - if they use less, they can sell their allowance. Currently they are given their allowances free, but in future they will have to buy them from national governments.
What steps can be taken? I am sure many people will be able to add to the list that follows. At the household level:
- better insulation;
- efficient boiler;
- thermostats on radiators, turning off radiators in even temporarily unoccupied rooms;
- drive less;
- check tyre pressure ideally weekly, and never less than monthly;
- fuel-efficient car;
- full loads for washing machines, don't use a tumble-drier;
- low-energy light bulbs;
- no standby - turn things off at the mains;
- don't waste food;
- eat less meat (but be sure that what you do eat, you buy at the farmers' market!);
- shop locally, and buy local produce where possible;
- go by foot, bicycle, bus or train, and not by car or plane;
Most of the above (though not always the last one) will save you money, though not as much money as they ought to save you if the price of carbon emissions reflected their cost. Steps which will cost money initially include:
- buy a solar water heater. This should give a return of about 5% - I haven't worked out the sums for mine, but it cost about £3,600 net of the grant available, and has meant that I use essentially no gas during the summer months, and noticeably less even in the winter. You could also buy a photovoltaic panel, which would cost around £11,000 depending on the size, but this may not yet be economically sensible - there are probably better ways of reducing your carbon footprint.
- offset your carbon. Carbon offsetting has had a bad press, which to some extent it has deserved. Poverty reduction is better done directly, eg via Oxfam, and not via carbon offsetting schemes in developing countries. You can offset your carbon by buying permits on the European exchange - each ton you buy for £18 means that industries will have to save carbon emissions whose true cost is certainly more, and may be about £45. EBICO -the equitable billing company - a not-for-profit organisation which I would recommend as a source of gas and electricity - will do the offsetting through its "equiclimate" scheme. The more carbon is "retired" from the market by individuals offsetting, the less industries will be able to emit. It is better not to emit than to emit and offset, but if you must emit, it is better to offset sensibly than not to offset at all.
When something that imposes costs of £45 can be had for £18 if you are an industry within the EU cap-and-trade scheme, and for nothing if you are a householder or private individual, then it is clear that the price system is not working properly. Without guidance from prices, it is hard to make sensible decisions. Many gut-reactions about how to deal with climate change can backfire, and have backfired - for example the absurd biofuel initiative, which in nearly every case (except perhaps Brazilian ethanol from sugar, and diesel from jatropha grown on poor soil) resembles topping up your bathwater by emptying wine bottles into the bath - you will notice the shortage of wine long before you are satisfied with the level of your bathwater. Converting foodstuffs into biofuel imposes huge costs on the poorest, via higher food prices, in exchange for no, or almost no, reduction in greenhouse gas emissions.
If each household were to pay the full £1,200 for our carbon emissions through a carbon tax, this would raise sufficient government revenue to allow a 40% cut in national insurance. If carbon emissions were correctly priced we would then not need to agonise about which is the right or ethical decision (does this tomato from the Canaries cause more carbon emissions in transportation than this one from a local hot-house? who can say for sure?)- we would simply know that the cheapest decision was the right one. I believe we should press our MPs for a carbon tax to offset a lower rate of national insurance - better to tax pollution than to tax work.