BY YULIA BUYNOVA
Yulia Buynova is a second-year Energy, Resources, and Environment student at Johns Hopkins SAIS and a Senior Editor for SAIS Perspectives.
Most of the blame for climate change and pressure to act has been put on governments and corporations as the main perpetrators of emissions. Still, private individuals and their preferences drive the demand for fossil fuels.[i] Although a 2020 BCG survey shows people believe that their private actions can help fight climate change, they often fall victim to compliancy to their customary behaviors, unsustainable habits, and lack of awareness that in turn unwillingly spike the level of greenhouse gas (GHG) emissions (such as driving a personal vehicle vs. tacking public transport; not recycling; not installing energy-efficient appliances).[ii] Government-mandated personalized carbon footprint in purchase receipts or monthly bank statements, as well as tutorials on how to decrease it, can become a valuable and cost-effective solution for changing private habits and increasing individuals’ awareness of their climate impact.
Policymakers can require stores and service providers to include a carbon footprint estimate or a carbon label based on products purchased, supply chain choices, transportation mode, and other impactful factors.[iii] Commercial banks could be mandated to provide a summation of carbon footprint based on customers' monthly activities. The metrics can be compared to the average individual footprint for a person of this income, living in this area, or age.
Benefits from this approach will arise if individuals adjust their behavior and adapt more climate-conscious habits long-term, decreasing cumulative emissions. Residential energy efficiency companies and utilities adopted a similar approach to reducing energy demand through home energy reports, incentivizing people to change their energy use habits. It resulted in a 2-3% annual reduction in energy consumption and decreased emissions.[iv] Although randomized trials are needed to prove the effectiveness of carbon footprint solutions, it can be assumed that a well-designed program can result in comparable emissions reductions and welfare and health benefits through a consumer switch to more climate-friendly consumption strategies. Government mandates will automatically enroll everyone, increasing the reach of the program.
A significant share of costs will come from technological adoption and integration of solutions to already existing store and banking systems and calculating per product carbon footprint. Transaction and administrative costs will arise as well. The International Organization for Standardization (ISO) issued a standard for the carbon footprint of products and guidelines for their quantification, laying the framework for quantifying the emissions.[v] The solution is consistent with the international standard on life cycle assessment and the application of the standard will ensure homogeneous calculations across industries and regions, making product comparison easier. Moreover, private app-based and digital solutions with a vast database of products and their footprint already exist.[vi] Governments could partner with private suppliers to integrate them.
This solution should include an educational and awareness-raising component to educate people about conscious climate options. Carbon footprint reports can provide simple behavior change suggestions to integrate into daily routines tailored to the user's location, income, age, and employment to address equity concerns.[vii] However, the content design of such campaigns will raise the costs of this project. Additional losses will arise for producers with a high carbon footprint or long supply chains due to lost revenue. It might adversely affect international trade if people prefer to shop locally instead of purchasing imported goods. Although the economic harm suffered by excluded parties, such as foreign producers and transportation networks is unfortunate, it can be justified if climate benefits outweigh it. Such an approach will push businesses to make more climate-conscious choices if they start to lose consumers, displacing some of the burdens on commercial actors.
The inclusion of carbon footprint in receipts and bank statements combined with educational tutorials can become an impactful but relatively inexpensive option for decreasing GHG emissions and mitigating climate impacts by utilizing behavior change techniques that were effective in other areas. It will not replace necessary changes in power generation, transportation, and industry but can be a low-hanging fruit for governments to utilize in the meantime.
Photo Credit: Forbes, “How To Be Carbon-Free, With A New App And A Neutrality Certificate,” September 11, 2020.
References
[i] Parag, Y. and D. Strickland, Personal Carbon Budgeting: What people need to know, learn and have in order to manage and live within a carbon budget and the policies that could support them,” UK Energy Research Center Working Paper, June 2009, https://ukerc.ac.uk/publications/personal-carbon-budgeting-what-people-need-to-know-learn-and-have-in-order-to-manage-and-live-within-a-carbon-budget-and-the-policies-that-could-support-them/
[ii] According to recent BCG survey, almost 95% of responders believe that personal actions can affect climate change outcomes.
Unnikrishnan, S., C. Biggs, and N. Singh, “Sustainability Matters Now More Than Ever for Consumer Companies,” BCG, August 11, 2020, https://www.bcg.com/en-gb/publications/2020/sustainability-matters-now-more-than-ever-for-consumer-companies.
[iii] "Just Salad" restaurant chain started to provide carbon labels for its online menu options since September 21, 2020.
Just Salad, “Online Menu: Chelsea, NYC location,” accessed October 31, 2021, https://www.orderjustsalad.com/view/menu/211
Kateman, B., “Carbon Labels Are Finally Coming To The Food And Beverage Industry,” Forbes, July 20, 2020, https://www.forbes.com/sites/briankateman/2020/07/20/carbon-labels-are-finally-coming-to-the-food-and-beverage-industry/?sh=7f7df5417c03.
[iv] Allcott, H., Social norms and energy conservation, Journal of Public Economics, Volume 95, Issues 9–10,
2011, pp. 1082-1095, https://doi.org/10.1016/j.jpubeco.2011.03.003.
[v] ISO 14067:2018 Greenhouse gases – Carbon footprint of products – Requirements and guidelines for quantification, accessed on October 30, 2021, https://www.iso.org/standard/71206.html
[vi] Private digital solutions aimed at calculating carbon footprint include Yayzy, Enfuce, Capture, 2030.
[vii]Such suggestions can include a list of local brands, rebates for energy-efficient appliances and technologies, public transportation options, benefits of electric vehicles and current options and supporting infrastructure, etc. This will simplify people's decisions when it comes to climate-conscious choices.