The EU’s greenhouse gas emissions from industry and power generation fell by 6 per cent last year, according to Point Carbon, the research group. Great news, right? Not really: it just shows that the easiest way to cut emissions is to batter the economy, and particularly the industrial sector.
Still, that does not mean the cuts are likely to be swiftly reversed.
The figures are Point Carbon estimates based on European Commission data, which are official but not yet complete. (Warning: the figures are not easy to read.) Other observers drew slightly different messages from the EU data, but the general picture is the same: overall emissions were significantly lower last year.
The full data will be released on May 15.
After falling steadily from last summer through to February of this year, EU carbon prices have recovered in recent weeks. However, they are still significantly below the level that is likely to be required to support investment in expensive low-carbon energy sources such as offshore wind and nuclear power, and particularly in carbon capture and storage. Germany on Wednesday became the first EU country to put a legal framework in place, but the financial framework is still missing.
The detail of the figures shows emissions from the cement, lime, glass, and pulp and paper industries all fell by 9 per cent last year. Spain, where the construction sector has slumped, saw a 6.8 per cent drop in its emissions.
The severity of the recession means demand for these products is unlikely to recover any time soon. And when it does, much of the capacity will have gone from Europe forever. When investment decisions are made about new cement and glass works, they are much more likely to be sited in Asia than in the EU. A loss of heavy industrial capacity means a loss of carbon emissions that will last forever.
That is likely to further inflame the tension between Europe and Asian economies, particularly China, which argue that a high proportion of their emissions are created by manufacturing goods exported to the West.
If China does not join a new post-Kyoto global emissions control agreement, then protests by carbon-intensive industries in Europe will grow. The pressure for carbon tariffs to penalise imports from China and other countries that do not put a price on CO2 emissions will be hard to resist.