Global CO2 emissions stall as GDP grows: What does it mean?

Global carbon emissions growth from burning fossil fuels and industry are set to slow or even decrease slightly this year, according to projections published Monday in the journal Nature Climate Change by researchers at the University of East Anglia and the Global Carbon Project.

Emissions could decline by 0.6 percent in 2015, a departure from a decade of growing 2.4 percent per year.

The results are supported by two analyses released earlier this year by the Netherlands Environmental Assessment Agency and the International Energy Agency, which show the rate of global emissions growth slowing significantly in 2014.

But unlike past periods with little or no emissions growth, global gross domestic product has grown substantially over the past two years, the researchers point out. In other words: Emissions and economic growth have decoupled, at least in the past two years.

And this decoupling wasn’t due to weird weather or accountancy ploys — much of the decline in emissions is due to a reduction in China’s coal consumption as its economy slows and it moves to cleaner, renewable energy sources in an effort to deal with its epic air pollution problem, the researcher said. The slower growth in emissions also resulted from below-average growth in global demand for oil and natural gas and continuing growth in renewable, mostly in the U.S. and Europe.

After a year of discouraging climate emissions milestones were reached, this is some encouraging news. Fourteen of the 15 hottest years on record have occurred since 2000, with 2015 on track to be the first year to top 1 degree Celsius average warming globally. This year, the planet also topped 400 parts per million in average monthly atmospheric carbon dioxide concentration for the first time in at least 800,000 years.

And then there’s the fact that we already have emitted two-thirds of the total carbon allocation to the atmosphere that would ensure at least a 66 percent chance of limiting global temperature increases to below 2 C — a reality that is undoubtedly weighing heavily on the world leaders in Paris for COP21.

The carbon is still pumping out

This good news comes with a major caveat — while global carbon emissions have slowed, they are still spewing at alarmingly high overall rates.

"A flat and declining growth rate for a couple of years does not change the fact that we're still adding 40 or so billion tons of CO2 to the atmosphere this year from fossil fuels and deforestation," Robert Jackson, a Stanford scientist and one of the authors on the report, told GreenBiz. "CO2 will keep marching upwards."

"Emissions aren't zero, it's just that they aren't rising or declining much from 36 billion tons of CO2 per year from fossil fuels and cement. Our climate worries remain very much intact."

And while the pause in emissions growth is encouraging, the researchers caution that this year is more likely to be an anomaly than a departure from the trend of emissions growth that began with the Industrial Revolution. It is unlikely that we have reached the peak of emissions, as the break in emissions has more to do with China’s economic instability.

"For these trends to continue, we would need to see altered production and consumption patterns and strong implementation of policies to reduce emissions," Kelly Levin, senior associate with World Resource Institute’s major emerging economies objective, told GreenBiz. "China has already put in place many plans to reduce emissions and has strong incentives to shift away from carbon-intensive technologies and behavior, as evidenced by the recent air pollution in Beijing and elsewhere."

In addition to China, many emerging economies in the global South are based on coal, and emissions are likely to spike in the coming years. In India, for example, carbon emissions increased by a noticeable 7.8 percent in 2014.

"China’s intensity target does lead to increased emissions ... if it does not peak until 2030," Levin said. "What we know from the INDCs is that global emissions are indeed projected to increase for the years to come, so we would need to see this low or no growth of emissions coupled with even strong commitments. The hope is that the Paris agreement will drive such reductions by providing regular five-year cycles for increased ambition guided by a strong long-term goal."

Invest in the global South’s clean energy future

Reconciling developing countries' right to continue to develop with the world’s need for reduced emissions is one of the highest hurdles that will need to be cleared to achieve a meaningful international climate change agreement at COP21. Developing economies such as India and China claim it’s not fair for the U.S. and Europe to expect them to cut their fossil fuel addiction when wealthy countries got that way largely from burning fossil fuels.

The 2009 Copenhagen Accord tried to remedy this with developed countries pledging to mobilize $100 billion per year of new aid by 2020 — although funding at this scale is proving to be difficult. Financial mechanisms such as the Green Climate Fund have been established to help invest in renewable energy and more sustainable infrastructure in the developing world, but this may not be enough.

The private sector may be able to help make up the shortfall, and there is immense opportunity for green businesses to get involved in helping developing countries’ economies to grow while minimizing carbon emissions.

"This study shows that emissions can decline while there is growth in global economic activity," Levin said. "There are significant advantages for businesses in a low-carbon world."

Overcoming market barriers and failures to create new investment opportunities and channel finance towards a global low-carbon economy could provide as much as $10 trillion worth of business opportunities and millions of jobs between today and 2030, according to a recent report by the Low Carbon Technology Partnerships initiative, part of the World Business Council for Sustainable Development.

"A strong Paris Agreement can help create a policy environment that will enable businesses and investors to reap significant benefits, such as increased cost savings, lower investment risk, more innovative products and markets, and greater investment in research and development of low-carbon technologies," Levin said.