I have been in support of doing something real (that is, not free but tradable permits) about trade-exposed industries not to support those industries per se but to support effective environment policy. I just don’t want Australia to claim credit for emissions reductions that are merely outsourced and off the balance sheet of local accountability.
The Defra-SEI report shows that as manufacturing in the UK has closed down, some of the production has shifted to countries where manufacturing is more carbon intensive than it would be here – in other words, more CO2 is emitted per unit of production.
At the same time, the long consumer boom has led to an increase in the volume and diversity of products being imported. This in turn leads to increased emissions from cargo shipping. Meanwhile, the cheap flights bonanza has pushed up emissions still higher.
Under internationally agreed methodology, emissions from international aviation, shipping and imports are not included in a country’s greenhouse gas statistics, so this has allowed the UK government to calculate that its greenhouse gases have been falling.
We are in danger of producing the same issues unless our domestic ETS and targets reflect these possibilities.