UK greenhouse gas reporting and mitigation policies should take account of emissions associated with imports, as well as those produced domestically, says a report by MPs.Unless these are accounted for, “the UK could be meeting its domestic carbon budgets at the expense of the global carbon budget,” they argue.

MPs on the House of Commons Energy and Climate Change Committee say the energy and climate department (DECC) should not rely solely on territorial emissions data.

The report, published on 18 April, acknowledges the UK’s achievement in cutting territorial emissions. But it says that consumption-based emissions data, including those from imports, are now sufficiently reliable to be included as well.

Under the UN Framework Convention on Climate Change and the Kyoto Protocol, only emissions within the UK’s national territory are reported. These account for 2% of the global total.

DECC's figures registered a fall of nearly 28% in UK emissions in 2009 relative to 1990, which the report attributes largely to a dash-for-gas in electricity generation and declining heavy industry.

But it also notes that the UK's overall carbon footprint rose, driven by rising UK consumption, particularly from imports. Imports accounted for just a quarter of the UK’s carbon footprint in 1990, but this had risen to almost half by 2009, based on DEFRA data published in March.If these data were included, emissions would have shown a 20% rise in the UK's footprint.

The committee holds back from recommending consumption-based reporting as the primary driver for UK climate policy. Instead, it argues that the data should be provided as a complementary tool, ensuring the UK leads in providing greater transparency on its overall carbon footprint.

It notes that experience from councils suggests such information can provide an opportunity for behavioural change among consumers.

Even so, it recommends that ministers should explore options for incorporating consumption-based emissions data into the policymaking process and examine how emissions targets based on consumption could be set nationally.

It says there is evidence that DECC “may be complacent about what it needs to do if it is basing energy and climate change policy on an incomplete picture of the UK’s emissions”.

The report says consumption-based reporting should be considered in DECC’s ongoing Energy Efficiency Deployment Office review of demand-side energy policy (ENDS Report, February 2012).

The committee accepts that territorial emissions should remain the basis for international climate negotiations and that shifting the onus onto key emerging economies exporting to the UK to cut ‘embedded’ emissions would be politically fraught.

It recommends the government examine the case for and against border tariff adjustments for embedded emissions, “when considering ways to limit consumption emissions and mitigate leakage risks”.

But it rejects DECC’s view that rising emissions from key exporters to the UK are a matter entirely for those economies, given the domestic opportunities for consumer behavioural change.

Even though the loss of electricity-intensive industries to emerging economies is a key factor in the UK’s reduced emissions, it says there is no evidence that ‘carbon leakage’ or increased energy costs have been driven primarily by the government’s climate policy (ENDS Report, June 2010).

It says there is therefore no evidence that compensation promised to these industries by the chancellor in the 2011 autumn statement is necessary (ENDS Report, December 2011). Any such aid should at least be matched by a commitment to boost energy efficiency, it says.

The committee welcomed DECC's increased willingness to consider consumption-based reporting, but says it should now take up the advisory Committee on Climate Change’s offer to assess the implications for the UK’s carbon budgets. It also says DECC should take up the committee's offer to examine the case for border tariffs.

Chris Tuppen, a witness to the inquiry and director of the Aldersgate Group said: "Just as companies are being encouraged to report their carbon emissions across their supply chain, so should governments. This would help to influence the overall purchasing behaviours of organisations and inform policy decisions at all levels.”

Simon Retallack, strategy manager at the Carbon Trust, also welcomed the report. “This new way of looking at carbon, through the lens of overall consumption, wherever it originates from, should act as an eye opener for policy makers, companies and for us all as individuals working to reduce our carbon emissions.”

Please note this article has been republished with the kind permission of the ENDS Report.