Visionary Science, Ethics, Law and Action in the Public Interest

Outsourcing U.S. greenhouse-gas emissions: The U.S. exports greenhouse-gas emissions to China and its other trading partners.

Rhitu Chatterjee
Environmental Science and Technology, June 13, 2007

In the past decade, the U.S. has witnessed a steady increase in its imports relative to its exports. This growing trade deficit has alarmed many economists and lawmakers because of related domestic job losses and wage reductions in the U.S. A new study published today on ES&T’s website (doi: ES0629110) introduces more reasons to worry. This paper illustrates that the boost in imports and associated consumption by the U.S. has added significantly to the greenhouse-gas emissions of its trading partners, especially those with poorly enforced environmental regulations, like China. The findings reinforce the need to account for the trade-related emissions in climate change policies.

The U.S. leads the world in greenhouse-gas emissions, but a new study shows that it causes its importing partners, particularly China, to generate a significant amount.

Between 1997 and 2004, imports into the U.S. increased by 128%, most of which were energy-expensive, pollution-causing products, such as electric and electronic goods, machinery, and equipment. Although consumption in the U.S. has increased, statistics show that U.S. emissions “haven’t gone up proportionately”, says study author Christopher Weber of Carnegie Mellon University’s departments of civil and environmental engineering and public policy. He attributes this disparity to the U.S. consuming many goods produced in other countries, a fact that is omitted from calculations to reduce U.S. emissions.

In industrialized countries, programs designed to cut down greenhouse gases rest on these measurements at the national level from domestic industries and don’t account for emissions from international trade, says Joseph Aldy, a climate-change and energy expert at the independent research institute Resources for the Future.

In their study, Weber and coauthor Scott Matthews used a multiregional input–output model to estimate the greenhouse gas emissions embodied in international trade between the U.S. and its seven largest import partners—Canada, China, Mexico, Japan, Germany, the U.K., and Korea—from 1997 to 2004. Their analysis revealed that overall greenhouse gas emissions from U.S. imports constitute a significant proportion of total U.S. emissions, and these emissions increased over the years.

For example, the CO2 emissions from imports in 2004 were 13–30% of total U.S emissions as opposed to only 9–14% in 1997. CO2 emissions from those imports grew from 0.5–0.8 gigatons (Gt) in 1997 to 0.8–1.8 Gt CO2 in 2004. The SO2 emissions increased from 2.4-5.0 million tons (Mt) in 1997 to 3.8-11.9 Mt in 2004, and NOx levels rose from 1.9-2.9 Mt in 1997 to 2.6-5.9 Mt in 2004.

The findings underscore the issue of “carbon leakage”, says Edgar Hertwich of the Norwegian University of Science and Technology, the phenomenon by which the emissions associated with consumption in one country actually occurs in other countries. Quantifying such leakage is crucial for any measure to curb greenhouse-gas emissions, such as a carbon cap-and-trade system. Experts and lawmakers in Europe are already discussing how to apply a border carbon-adjustment tax for goods imported from countries with lax or poorly enforced environmental regulations. The issue is also being grappled with in the U.S. Congress as legislators work to craft mandatory greenhouse-gas controls. This phenomenon has been rising over the last two decades as industries in industrialized countries move to developing countries to avoid strict safety and health regulations.

“A lot of the issue with these carbon calculations is not only where we are now but where we are headed in the future,” says ecologist Christopher Field at the Carnegie Institution of Washington. In a recent paper in Proceedings of the National Academy of Sciences U.S.A., Field documented the alarming increase in global CO2 emissions. Weber’s findings clearly show a trend of increasing emissions from imports to the U.S., he adds.

Another key finding of the new study is that imports from China are major contributors. “One reason is that net import with respect to China has increased significantly,” says Aldy. Another reason is China’s high carbon intensity of production. A high dependence on coal-based power in industrial production accounts for the high greenhouse-gas emissions from trade with China, he says.

Although developing policies to correct for such emissions will take some time, it is important to “understand that the things we consume have a footprint, they have emissions during their life cycle, and it doesn’t help moving dirty industries to other countries,” says Hertwich. “It doesn’t really clean up the environment.” —RHITU CHATTERJEE

Copyright © 2007 American Chemical Society

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