Historically, CO2 emissions have been strongly correlated with how much money we have. This is particularly true at low-to-middle incomes. The richer we are, the more CO2 we emit. This is because we use more energy – which often comes from burning fossil fuels.
But this relationship no longer holds true at higher incomes. Many countries have managed to achieve economic growth while reducing emissions. They have decoupled the two.
Take the UK as an example. It is shown in the chart. This chart shows the change in GDP and annual CO2 emissions per capita since 1990. We see that the UK’s GDP has increased a lot over the last 30 years, while its emissions have fallen. You can also see the data without per capita adjustments.
It’s not just the UK. Many other countries have achieved this decoupling. Using the “Change country” button on the chart, you can see this for yourself. France, Germany, Sweden, Finland, Denmark, Italy, Czechia and Romania are some examples of countries where we see this.
More countries have managed to decouple more recently. Emissions in the US, for example, increased substantially in the 1990s. This means that its emissions today are still higher than in 1990. But if we look at the change since 2000 [you can do this by adjusting the time-slider on the bottom of the chart] we see a large drop in emissions alongside a rise in GDP. It’s only over the last 20 years that this decoupling has started to happen.
There are two key reasons why emissions have fallen in these countries. First, some countries have managed to decouple energy use and economic growth. GDP has increased while total energy use has remained flat, or even fallen. But the second is the most important: countries are replacing fossil fuels with low-carbon energy. We can produce more energy, without the emissions that used to come with it.
It would be wrong to assume that this reduction in emissions in rich countries was only achieved by offshoring production overseas – by transferring emissions to manufacturing economies such as China and India. In the chart we see that consumption-based emissions – which adjust for emissions from goods that are imported or exported – have also fallen. Some emissions have been exported overseas, but this is not the only driver of this decline.
These countries show that economic growth is not incompatible with reducing emissions.
A key question is whether we can decarbonize fast enough, and across more countries. The continued decline in the cost of low-carbon technologies makes this acceleration more realistic every day.