The myth of "green growth"

By Martin Auer

Fifty years ago, the groundbreaking book The Limits to Growth, commissioned by the Club of Rome and produced at the Massachusetts Institute of Technology (MIT), was published. Lead authors were Donella and Dennis Meadows. Their study was based on a computer simulation that recreated the relationship between five global trends: industrialization, population growth, malnutrition, depletion of natural resources, and habitat destruction. The result was: "If the current increases in world population, industrialization, pollution, food production and the exploitation of natural resources continue unchanged, the absolute limits of growth on earth will be reached over the course of the next hundred years."1

The book, according to Donella Meadows, "was not written to prophesy doom, but to challenge people to find ways of life that are in harmony with the laws of the planet."2

Although today there is a great deal of agreement that human activities have irreversible effects on the environment, as the journal Nature writes in its latest issue3, researchers are divided on possible solutions, especially whether it is necessary to limit economic growth or whether "green growth" is possible.

“Green growth” means that economic output increases while resource consumption decreases. Resource consumption can mean the consumption of fossil fuels or the consumption of energy in general or the consumption of specific raw materials. Of paramount importance are of course the consumption of the remaining carbon budget, the consumption of soil, the loss of biodiversity, the consumption of clean water, the over-fertilization of soil and water with nitrogen and phosphorus, the acidification of the oceans and the pollution of the environment with plastic and other chemical products.

Decoupling economic growth from resource consumption

The concept of “decoupling” economic growth from resource consumption is essential for the discussion. If the consumption of resources increases at the same rate as economic output, then economic growth and resource consumption are linked. When the consumption of resources increases more slowly than economic output, one speaks of "relative decoupling". Only if the consumption of resources decreases, while economic output increases, one canabsolute decoupling”, and only then can one also speak of “green growth”. But only if the consumption of resources decreases to the extent that is necessary to achieve the climate and biodiversity goals, according to Johan Rockström Stockholm Resilience Centre justified by "real green growth"4 to speak.

Rockstrom introducing the concept of planetary boundaries5 co-developed believes that national economies can grow while their greenhouse gas emissions fall. Since his voice has great weight internationally, we will go into detail about his thesis here. He refers to the successes of the Nordic countries in reducing their greenhouse gas emissions. In an article co-authored with Per Espen Stoknes6 from 2018 he develops a definition of “true green growth”. In their model, Rockström and Stoknes only refer to climate change because there are known parameters for this. In this specific case, it is about the relationship between CO2 emissions and added value. In order for emissions to decrease while value added increases, the value added per tonne of CO2 must increase. The authors assume that an annual reduction in CO2 emissions of 2015% from 2 is necessary in order to achieve the goal of warming below 2°C. They also assume an average increase in global economic output (the global GDP or large domestic product) by 3% annually. From this they deduce that the added value per tonne of CO2 emissions must increase by 5% per year in order for “real green growth” to exist7. They describe this 5% as the minimum and optimistic assumption.

In the next step, they examine whether such an increase in carbon productivity (i.e. the value added per CO2 emissions) has actually been achieved anywhere, and find that Sweden, Finland and Denmark did in fact have an annual increase in carbon productivity in the period 2003-2014 5,7%, 5,5% would have reached 5,0%. From this they draw the conclusion that "real green growth" is possible and empirically identifiable. They consider this possibility of a win-win situation, which enables both climate protection and growth, to be important for the political acceptance of climate protection and sustainability. In fact, “green growth” is a target for many policymakers in the EU, the UN and around the world.

In a 2021 study8 Tilsted et al. the contribution of Stoknes and Rockström. Above all, they criticize the fact that Stoknes and Rockström have used production-based territorial emissions, i.e. emissions that are generated in the country itself. These emissions do not include emissions from international shipping and air traffic. If these emissions are included in the calculation, the result for Denmark, for example, changes considerably. Maersk, the world's largest container ship company, is based in Denmark. As its value added is included in Danish GDP, its emissions must also be included. With this, however, Denmark's progress in the development of carbon productivity disappears almost completely and there is almost no absolute decoupling any more.

If one uses consumption-based instead of production-based emissions, the picture changes even more. Consumption-based emissions are those generated by the manufacturing of the goods consumed in the country, regardless of which part of the world they are produced in. In this calculation, all Nordic countries fall well short of the 5% annual increase in carbon productivity required for 'true green growth'.

Another point of criticism is that Soknes and Rockström have used the 2°C target. Since the risks of 2°C warming are far greater than 1,5°C, this target should be used as a benchmark for sufficient reductions in emissions.

Seven Obstacles to Green Growth

In 2019, the NGO European Environment Bureau published the study "Decoupling Debunked"9 (“Decoupling Unmasked”) by Timothée Parrique and six other scientists. In the last decade, the authors note, "green growth" has dominated economic strategies in the UN, the EU and numerous other countries. These strategies are based on the wrong assumption that sufficient decoupling can be achieved through improved energy efficiency alone, without limiting the production and consumption of economic goods. There is no empirical evidence that decoupling has been achieved anywhere sufficient to avoid environmental breakdown, and it seems very unlikely that such decoupling will be possible in the future.

The authors state that existing political strategies for improving energy efficiency must necessarily be complemented by measures towards sufficiency10 need to be supplemented. What is meant by this is that production and consumption in the wealthy countries should be reduced to a sufficient, sufficient level, a level in which a good life is possible within the planetary limits.

In this context, the authors cite the study "Global carbon inequality" by Hubacek et al. (2017)11: The first of the UN Sustainable Development Goals (SDGs) is poverty eradication. In 2017, half of humanity lived on less than $3 a day. This income group caused only 15 percent of global greenhouse gas emissions. A quarter of humanity lived on around $3 to $8 a day and caused 23 percent of emissions. Their CO2 footprint per person was therefore about three times higher than that of the lowest income group. So if the lowest incomes are to be raised to the next higher level by 2050, that alone (with the same energy efficiency) would consume 66 percent of the CO2 budget available for the 2°C target. The carbon footprint of the top 2 percent with more than $10 a day was more than 23 times that of the poorest. (See also the post in Celsius: The rich and the climate.)

According to Parrique's team, this results in a clear moral obligation for the countries that have so far benefited most from the CO2 pollution of the atmosphere to radically reduce their emissions in order to give the countries of the Global South the necessary leeway for development.

In detail, the authors state that sufficient decoupling cannot be determined in the areas of material consumption, energy consumption, land consumption, water consumption, greenhouse gas emissions, water pollution or biodiversity loss. In most cases, decoupling is relative. If there is absolute decoupling, then only over a short period of time and locally.

The authors cite a number of reasons that prevent decoupling:

1. Increasing energy expenditure: When a particular resource is extracted (not just fossil fuels, but also, for example, ores), it is first extracted from where it is possible with the lowest cost and energy consumption. The more of the resource that has already been used, the more difficult, expensive and energy-intensive it is to exploit new deposits, such as tar sands and oil shale. Even the most valuable coal, anthracite, has almost been used up, and today inferior coals are being mined. In 1930, copper ores with a copper concentration of 1,8% were mined, today the concentration is 0,5%. In order to extract materials, three times as much material has to be moved today as it was 100 years ago. 1 kWh of renewable energy uses 10 times more metal than XNUMX kWh of fossil energy.
2. Rebound Effects: Improvements in energy efficiency often result in some or all of the savings being offset elsewhere. For example, if a more economical car is used more often or if the savings from lower energy costs are invested in a flight. There are also structural effects. For example, more economical internal combustion engines can mean that the car-heavy transport system becomes entrenched and that more sustainable alternatives such as cycling and walking do not come into play. In industry, the purchase of more efficient machines is an incentive to increase production.
3. problem shift: Technical solutions to an environmental problem can create new problems or exacerbate existing ones. Electric private cars are increasing the pressure on lithium, cobalt and copper deposits. This can further exacerbate the social problems associated with the extraction of these raw materials. The extraction of rare earths causes serious environmental damage. Biofuels or biomass for energy production have a negative impact on land use. Hydropower can lead to methane emissions when sludge accumulation behind the dams encourages algae growth. A glaring example of problem shifting is this: The world has been able to decouple economic growth from horse manure pollution and whale blubber consumption - but only by replacing them with other types of natural consumption.
4. The effects of the service economy are often underestimated: The service economy can only exist on the basis of the material economy, not without it. Intangible products need a physical infrastructure. Software needs hardware. A massage parlor needs a heated room. Those employed in the service sector receive wages which they then spend on material goods. The advertising industry and financial services serve to stimulate the sale of material goods. Sure, yoga clubs, couples therapists, or climbing schools can put less pressure on the environment, but that's not mandatory either. The information and communication industries are energy-intensive: the Internet alone is responsible for 1,5% to 2% of global energy consumption. The transition to a service economy is almost complete in most OECD countries. And these are precisely the countries that have a high consumption-based footprint.
5. The potential of recycling is limited: Recycling rates are currently very low and only increasing slowly. Recycling still requires a significant investment in energy and reclaimed raw materials. Materials. Materials degrade over time and must be replaced with newly mined ones. Even with the Fairphone, which is highly valued for its modular design, 30% of the materials can be recycled at best. The rare metals needed to generate and store renewable energy were only 2011% recycled in 1. It is clear that even the best recycling cannot increase the material. A growing economy cannot get by on recycled material. The material with the best recycling rate is steel. With annual growth in steel consumption of 2%, the world's iron ore reserves will be exhausted around the year 2139. The current recycling rate of 62% can delay that point by 12 years. If the recycling rate can be increased to 90%, that will only add another 7 years12.
6. The technological innovations are not enough: Technological progress does not target the production factors that are important for environmental sustainability and does not lead to innovations that reduce pressure on the environment. It doesn't manage to replace other, unwanted technologies, nor is it fast enough to ensure sufficient decoupling. Most technological advances are aimed at saving labor and capital. However, it is precisely this process that leads to an ever-increasing increase in production. Until now, renewable energy sources have not led to a reduction in fossil fuel consumption because energy consumption is growing overall. Renewables are only additional sources of energy. The share of coal in global energy consumption has fallen in percentage terms, but absolute coal consumption has been increasing to this day. In a capitalistic, growth-oriented economy, innovations happen above all when they bring profit. Therefore, most innovations drive growth.
7. cost shifting: Some of what is called decoupling is actually just a shift in environmental damage from high-consumption to low-consumption countries. Taking the consumption-based ecological footprint into account paints a much less rosy picture and raises doubts about the possibility of future decoupling.

The authors conclude that the proponents of "green growth" have little or nothing convincing to say about the seven points listed. Policymakers need to recognize the fact that tackling the climate and biodiversity crises (which are just two of several environmental crises) will require reducing economic production and consumption in the wealthiest countries. This, they stress, is not an abstract narrative. In recent decades, social movements in the Global North have organized around the concept of sufficiency: Transition Towns, degrowth movement, ecovillages, Slow Cities, solidarity economy, Economy of the common good are examples. What these movements are saying is: more is not always better, and enough is plenty. According to the authors of the study, it is not necessary to decouple economic growth from environmental damage, but to decouple prosperity and a good life from economic growth.

SIGHTED: Renate Christ
COVER IMAGE: Montage by Martin Auer, photos by Matthias Boeckel and Blueightpictures via Pixabay)

Footnotes:

1Club of Rome (2000): The Limits to Growth. Report of the Club of Rome on the state of mankind. 17th edition Stuttgart: German publishing house, p.17

2https://www.nature.com/articles/d41586-022-00723-1

3ibid

4Stoknes, Per Espen; Rockström, Johan (2018): Redefining green growth within planetary boundaries. In: Energy Research & Social Science 44, pp. 41-49. DOI: 10.1016/j.erss.2018.04.030

5Rockstrom, Johan (2010): Planetary Boundaries. In: New Perspectives Quarterly 27 (1), pp. 72-74. DOI: 10.1111/j.1540-5842.2010.01142.x.

6ibid.

7Added value per unit of CO2 is called carbon productivity, abbreviated CAPRO.
CAPRO = GDP/CO2 → GDP/CAPRO = CO2.. If you insert 103 for GDP and 105 for CAPRO, the result is 2 for CO0,98095, i.e. a decrease of almost exactly 2%.

8Tilsted, Joachim Peter; Bjorn, Anders; Majeau-Bettez, Guillaume; Lund, Jens Friis (2021): Accounting matters: Revisiting claims of decoupling and genuine green growth in Nordic countries. In: Ecological Economics 187, pp. 1–9. DOI: 10.1016/j.ecolecon.2021.107101.

9Parrique T, Barth J, Briens F, Kerschner C, Kraus-Polk A, Kuokkanen A, Spangenberg JH (2019): Decoupling-Debunked. Evidence and arguments against green growth as a sole strategy for sustainability. Brussels: European Environmental Bureau.

10From English Sufficient = enough.

11Hubacek, Klaus; Baiocchi, Giovanni; Feng, Kuishuang; Muñoz Castillo, Raúl; Sun, Laixiang; Xue, Jinjun (2017): Global carbon inequality. In: Energy. Ecol. environment 2 (6), pp. 361-369. DOI: 10.1007/s40974-017-0072-9.

12Big, f; Mainguy, G. (2010): Is Recycling “Part of the Solution”? The Role of Recycling in an Expanding Society and a World of Finite Resources. https://journals.openedition.org/sapiens/906#tocto1n2