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Iceland's Consumption and Decarbonisation

Svavarsdottir, Gudrun LU (2019) NEKN01 20191
Department of Economics
Abstract
As an effort in combating climate change, the Icelandic government has set the ambitious goal of a carbon-neutral economy before the year 2040. Meanwhile, projections show continuing growth in private household consumption. The aim of this thesis is to examine these goals of carbon-neutrality using an alternative way of accounting for carbon emissions, a consumption-based approach in contrast to production-based, keeping in mind the expected increase in consumption. The aim is twofold. Firstly, the relationship between consumption and emissions is examined. Granger causality was seen running from consumption to production-based emissions, while the opposite was the case for consumption-based emissions, which were shown to lead consumption.... (More)
As an effort in combating climate change, the Icelandic government has set the ambitious goal of a carbon-neutral economy before the year 2040. Meanwhile, projections show continuing growth in private household consumption. The aim of this thesis is to examine these goals of carbon-neutrality using an alternative way of accounting for carbon emissions, a consumption-based approach in contrast to production-based, keeping in mind the expected increase in consumption. The aim is twofold. Firstly, the relationship between consumption and emissions is examined. Granger causality was seen running from consumption to production-based emissions, while the opposite was the case for consumption-based emissions, which were shown to lead consumption. This suggests that lowering consumption-based emissions is impossible without lowering household consumption, while decoupling production-based emissions from consumption is shown to be possible. Secondly, these results are used to present rough scenarios showing different paths of consumption-based emissions depending on household consumption behaviour. If the goal is to decrease global emissions, not simply emissions within the borders of Iceland, it is unlikely that complete carbon-neutrality (i.e. consumption-based) is reached without changes in consumption. (Less)
Please use this url to cite or link to this publication:
author
Svavarsdottir, Gudrun LU
supervisor
organization
course
NEKN01 20191
year
type
H1 - Master's Degree (One Year)
subject
keywords
Carbon emissions. Consumption. Decarbonisation. Iceland.
language
English
id
8979048
date added to LUP
2019-08-08 10:31:16
date last changed
2019-08-08 10:31:16
@misc{8979048,
  abstract     = {{As an effort in combating climate change, the Icelandic government has set the ambitious goal of a carbon-neutral economy before the year 2040. Meanwhile, projections show continuing growth in private household consumption. The aim of this thesis is to examine these goals of carbon-neutrality using an alternative way of accounting for carbon emissions, a consumption-based approach in contrast to production-based, keeping in mind the expected increase in consumption. The aim is twofold. Firstly, the relationship between consumption and emissions is examined. Granger causality was seen running from consumption to production-based emissions, while the opposite was the case for consumption-based emissions, which were shown to lead consumption. This suggests that lowering consumption-based emissions is impossible without lowering household consumption, while decoupling production-based emissions from consumption is shown to be possible. Secondly, these results are used to present rough scenarios showing different paths of consumption-based emissions depending on household consumption behaviour. If the goal is to decrease global emissions, not simply emissions within the borders of Iceland, it is unlikely that complete carbon-neutrality (i.e. consumption-based) is reached without changes in consumption.}},
  author       = {{Svavarsdottir, Gudrun}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{Iceland's Consumption and Decarbonisation}},
  year         = {{2019}},
}