The world’s wealthiest 1% are responsible for 21% of emissions growth, research shows
I’m generally opposed to arguments that consumers, rather than institutions, need to take the lead on climate change. Consumers are not a coordinated group and have much less potential to cause massive shifts to the trajectory of global warming than businesses do.
But the data produced by researchers at the World Inequality Lab (WIL), which is led by the Paris School of Economics and University of California at Berkeley, makes a compelling case for individual action. Or, at least, throws up some interesting data.
The WIL assessed carbon emissions as related to personal wealth and found that, generally, the richest among us are also the most polluting of us, with the world’s wealthiest 10% also serving as the planet’s highest decile of polluters.
Although that trend is not surprising, and has been reported before, I often forget—as is borne out by Bloomberg’s reporting on WIL’s study—that the world’s richest people aren’t just the uberwealthy, like Elon Musk and Jeff Bezos. The world’s richest 10% of people earn roughly $38,000 a year, which is approximately the income of the average American in 2019.
That means if you’re reading this newsletter, you’re probably among the world’s worst 10% of individual carbon emitters.
On a global scale, even the threshold for entering the top 1% of wealth isn’t as obscenely high as you might expect. The top 1% of earners across the world have an annual income of $109,000 a year and are responsible for 21% of emissions growth since 1990.
Of course, the super wealthy are much worse.
The single most polluting asset an individual can own, WIL says, is a superyacht, sales of which surged 77% in the past year. Meanwhile, WIL says, the rocket ride Bezos took to space last year caused more pollution per passenger than the poorest billion people will ever produce in their lifetime.
The fact that Bezos can blast out more pollution in a single joyride than a seventh of the world’s population could ever muster gets to the crux of WIL’s research. In order for nations to meet their climate goals and reduce emissions, country’s need to get redress the wealth-disparity inherent in individual emissions.
To achieve carbon footprint parity in the U.S., WIL says, the nation’s leading polluters would have to reduce personal emissions 87% by 2030 while the bottom half of polluters could actually increase their own by 3%. Thankfully, slashing personal emissions doesn’t have to be so hard.
A lot of wealth-driven emissions come from lifestyle choices, like eating meat or driving a car, which are fairly easy to unwind. According to the University of Oxford, an average person can reduce their transport emissions 67% by choosing to cycle rather than drive just one day per week.
Out of gas
The EU warned Monday that the bloc’s economy will likely contract in the remainder of the year if Russian gas supplies are halted soon, either by European importers or by Russia itself. The EU has said it will find ways to wean itself off of Russian energy, following the invasion of Ukraine, but finding replacements for Russia’s oil and gas supplies is a slow process. The U.S. has offered to ramp up exports but is limited by infrastructure capacity. WSJ
To accelerate its exit from Russian gas, the EU is looking to raise $21 billion through selling additional carbon emissions permits, making it cheaper for companies to burn fossil fuels and jeopardizing the bloc’s own emission reduction goals. The EU has targeted spending $210 billion on alternative energy sources by the end of the year, to reduce reliance on Russia. FT
A frist in Chinese tech
Ant Group, the fintech affiliate of China’s e-commerce giant Alibaba, completed the Chinese tech sector’s first sustainability-linked loan Monday, opening a ESG credit line with French bank BNP Paribas. Under the terms of the revolving loan, Ant will receive a lower interest rate if it passes annual audits on its renewable energy targets and environmental charity donations annually. The value of the credit line is undisclosed, however. Bloomberg
A different type of battery
Energy storage doesn’t have to be a battery. This week China is preparing to connect its first industrial compressed air energy storage facility to the electric grid, after the fairly novel storage solution completed four days of successful trials. The system works by using excess electricity to pump compressed air into a large chamber—in this case, a cave. When the grid needs more electricity, the compressed air is then released through a turbine, converting air back to power. The Jiangsu Jintan Salt Cave project is the largest compressed air battery in the world, with a 60-megawatt capacity. Bloomberg
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Saudi Aramco reported its best quarterly earnings since going public in 2019, booking net income of $39.5 billion in the first three months of the year—82% higher than the same period last year. The sovereign oil giant, along with other global fossil fuel majors, has benefitted from surging oil prices, inflated by the war in Ukraine. The international Brent crude benchmark hit a 14-year high in March, with oil futures trading at $139 a barrel. The price is now around $113.
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