Oregon DEQ: Land Quality - Consumption-based Greenhouse Gas Emissions Inventory in Oregon

Questions and Answers

What’s a “GHG inventory”? How are inventories used?

A greenhouse gas (GHG) inventory is an accounting of gases that contribute to climate change. These gases include fossil-derived carbon dioxide, methane, nitrous oxide and others. Greenhouse gas inventories can be conducted for organizations (such as businesses) or for communities, such as at the scale of nations, states or cities. Organizational and community inventories are not the same. DEQ’s recently released consumption-based emissions inventory is an inventory for a community (Oregon).

Inventories typically serve as the first step in planning for how a community might reduce emissions. By understanding how a state or city contributes to emissions, community members can better understand opportunities to reduce them. Inventories also help communities set and evaluate goals. For example, a community might conduct an inventory in year X and then set a goal to reduce emissions 10 percent below those emissions in 10 years. Finally, inventories can help explain to policymakers, businesses and the general public how their community contributes to emissions.
Why did DEQ commission this consumption-based emissions inventory after Oregon already completed a conventional GHG inventory?

In 2004, DEQ provided staff support to Governor Kulongoski’s Advisory Group on Global Warming. One of DEQ’s support roles was to staff a Technical Subcommittee on Materials and Wastes. In the course of evaluating the GHG reduction potential of various actions, it became clear that the state’s existing, conventional GHG inventory excluded many of the emissions associated with materials, simply because the emissions occur in other states, and the state’s conventional inventory focuses on in-state emissions (with the exception of emissions associated with electricity).

Over the next several years, other limitations of the conventional inventory became apparent. Specifically, the conventional inventory provides consumers and policymakers with an incomplete view of how Oregon contributes to emissions, and by extension, opportunities to reduce emissions.

One example of this is recycling. Collecting recyclables from homes, as is required in many Oregon cities, requires fuel. Producing and burning that fuel produces greenhouse gas emissions. Because the combustion of fuel occurs in-state (and in-community) it is included in conventional inventories at the state and city level. However, when recyclables collected from households are used to produce new products, the resulting reduction in greenhouse gas emissions can be up to 40 times higher. Most of these emissions reductions occur in other states, however, and thus are not reflected in the state’s conventional inventory.

The conventional inventory also has the potential, by itself, of providing misleading evaluation of change over time. For example, in-state emissions might decrease even as consumption-based emissions increase.

In 2007, the Oregon Environmental Quality Commission encouraged DEQ to develop a “fix” that would supplement the state’s conventional inventory by providing an alternative view of how Oregonians contribute to emissions – and by extension, opportunities to reduce emissions. The commission also asked DEQ to try and get other communities to adopt a similarly broad view. Once resources became available, DEQ initiated the research required to develop this supplemental, consumption-based emissions inventory.
What’s included in this consumption-based emissions inventory? What’s not included?

The inventory includes estimates of most emissions, globally-distributed, associated with the life cycle of materials and services, including electricity and fuels, consumed in Oregon. These emissions are included regardless of whether they physically originate in Oregon or elsewhere. Changes in atmospheric concentration of greenhouse gases associated with land-use change (for example, carbon storage by regional forests, or carbon releases as tropical forests are replaced with plantations) are not included.
So can DEQ tell me the emissions associated with everything I buy (as a consumer) or make (as a producer)?

No. The model used to develop this inventory uses averages: both for what Oregon consumers purchase and also emissions associated with producing individual commodities. DEQ does not have information on individual consumers, and the model does not provide data about individual producers. DEQ understands that individual consumers and producers may both vary widely from the average. However, for the purpose of DEQ’s consumption-based inventory, which is conducted at the scale of the entire state, use of averages is sufficient.
How does the consumption-based inventory compare with Oregon’s conventional GHG inventory?

While the two inventories have some overlap, they’re fundamentally different. The consumption-based inventory includes estimates of most emissions, globally-distributed, associated with the life cycle of materials and services, including electricity and fuels, consumed in Oregon. The conventional inventory focuses on in-state emissions but includes out-of-state emissions associated at the point of electricity generation, for electricity used in Oregon. Many in-state emissions included in the conventional inventory are not included in the consumption-based inventory. In-state emissions are only included in the consumption-based inventory if they are somehow associated with in-state consumption. Emissions associated with in-state producers making goods for export out-of-state are not included in the consumption-based inventory, unless those exports subsequently become part of supply chains that support in-state consumption.

While both inventories (conventional and consumption-based) count some of the same emissions, the consumption-based approach introduces a significantly new field of emissions that are not included in the conventional inventory.
So is the consumption-based inventory better than the conventional inventory? More complete?

The two inventories are not more or less comprehensive than each other. Rather, they each present an incomplete view of how the state contributes to emissions. Viewing the two inventories together offers a more comprehensive perspective; two different perspectives are better than a single perspective.
Can the results of the two inventories be reconciled? Added together?

The two inventories should not be simply added together, as they share significant overlap, and it is challenging to identify exactly where the overlap occurs, in part because the inventories use fundamentally different approaches to estimate emissions. Of the 78 million metric tons of carbon dioxide equivalent in the 2005 consumption-based inventory, less than half (36 million metric tons) originated in-state. Of the remaining 42 million metric tons, 24 originated elsewhere in the United States. Some but not most of these other domestic emissions (24 million metric tons) are associated with electricity consumption in Oregon, and are included in both inventories. Other domestic but out-of-state consumption-based emissions are not included in the conventional inventory, nor are the 18 million metric tons in the consumption-based inventory that occur in other nations.
Why focus on consumption?

In economic terms, consumption is the root cause of all economic activity. By extension, understanding the emissions associated with Oregon’s consumption sheds more light on root drivers of greenhouse gas emissions.

Second, a consumption-based approach is different enough from the state’s conventional inventory so that it offers a significantly different perspective. While both inventories count some of the same emissions, both also uniquely count other emissions. Specifically, the consumption-based inventory uniquely counts out-of-state emissions associated with producing the products, services and fuels consumed in Oregon. It also counts emissions associated with producing fuels that are used to generate electricity consumed in Oregon.

Emissions are also categorized and organized differently. Having two perspectives of how Oregon contributes to emissions, as opposed to a single perspective, broadens and deepens our collective perspective and understanding.
How might DEQ or others use the results of this inventory?

DEQ produced the inventory study to improve common understanding about Oregonians’ impact on the environment. This is akin to other information and research reports that DEQ periodically prepares. DEQ does not have a specific policy or legislative agenda that the inventory supports. Rather, DEQ believes that the consumption-based inventory, when considered alongside the state’s conventional GHG inventory, offers a more comprehensive understanding of how the state contributes to climate change, and by extension, opportunities to reduce that contribution to climate change.

Potential uses of the consumption-based inventory and supporting research include the following:

The state’s Global Warming Commission may use this inventory as it identifies ways Oregon can reduce greenhouse gas emissions.
If the state repeats a consumption-based inventory in future years, it could use the inventory to help track Oregon’s progress at reducing greenhouse gas emissions.
The inventory identifies broad categories of consumption (such as vehicles, appliances, food and manufactured products) that contribute higher amounts of greenhouse gas emissions. These categories would likely benefit from further study and/or action, including voluntary action by producers and consumers.
Similarly the study suggests that Oregon- and U.S.- made products may, in some cases, result in lower GHG emissions than products made in foreign countries. Further research is needed to better understand this dynamic, and DEQ’s inventory could help to justify and shape that additional research.
The study may be useful as a screening tool to identify ways to reduce GHG emissions associated with state and local government purchasing.
Businesses may find some of the underlying analysis useful for evaluating greenhouse gas emissions associated with the products they make or sell, and find ways to produce and deliver goods and services in ways that reduce GHG emissions.

The inventory is not intended to replace any existing inventories of greenhouse gas emissions. It does not list specific recommendations on changing consumer/producer behavior and is not intended as a “consumer guide” to reducing emissions. It does not suggest changes to existing policies, and is not part of any effort to impose a state “carbon tax” on products.

Is DEQ telling Oregonians what to buy and what to eat?

No. While the inventory estimates emissions associated with consumption, including consumption by households, and identifies categories of emissions with higher emissions and emissions intensities, DEQ is not telling Oregonians what to buy and eat. Some members of the public may wish to use results of this study to help inform day-to-day purchasing decisions. The analysis only considers greenhouse gas impacts, and not the myriad other factors (financial, environmental, social, health, etc.) that consumers also consider when making purchasing decisions. The analysis also cannot help consumers choose between competing brands of products. It can help assess what categories of decisions matter most in terms of reducing greenhouse gas emissions and addressing climate change – and so may be useful as a tool for prioritizing efforts. Categories of household consumption associated with the greatest greenhouse gas emissions are personal vehicles, appliances, food and beverages, and other manufactured products (clothing, medicines, consumer electronics, furnishings, furniture, etc.). However, the report does not make specific recommendations for purchasing or other behavior changes.
How does this project relate to the Oregon Global Warming Commission’s “Roadmap to 2020”?

The Commission’s “Roadmap to 2020” lists actions that could be taken to help the state meet its goal to reduce GHG emissions in 2020 to 10 percent below 1990 levels. These ideas are recommendations to the Governor, Legislature, Oregon’s Congressional delegation, local governments, businesses and Oregonians generally. Completion of DEQ’s consumption-based emissions inventory, and subsequent application of the results, is one of the recommendations in the Roadmap. DEQ was one of many state agencies that provided staff support to the commission as it drafted the Roadmap to 2020. In conducting some of the technical analysis of options while the Roadmap was developed, DEQ used a draft version of the consumption-based inventory model.
Does the consumption-based inventory include all emissions associated with materials used in Oregon?

No. The consumption-based inventory only accounts of life-cycle emissions of materials if they are consumed in Oregon (as part of “final demand” by Oregon consumers), or otherwise are part of the supply chain of consumption in Oregon. Materials that are produced in Oregon and exported for ultimate use out-of-state are not included.
How does the consumption-based inventory treat recycling?

Waste recycling (and composting of some wastes) reduces greenhouse gas emissions when viewed from a life-cycle perspective. Since 2004, DEQ has estimated the life-cycle GHG reductions associated with recycling and composting in Oregon. Of the estimated GHG reductions of roughly 3.3 million metric tons of CO2e (carbon dioxide equivalent) resulting from recycling and composting in 2005, DEQ estimates that roughly one-third (or 1.1 million metric tons of CO2e) are accounted for in the consumption-based inventory. For details, including a fuller discussion of data sources and methodology, please refer to this report:

Supplemental Technical Report: Treatment of Greenhouse Gas Reductions from Recycling and Composting in Oregon's Consumption-based Greenhouse Gas Emissions Inventory PDF

What do you mean by “final demand” and “consumers”?

“Final demand” is another term for “consumption.” It includes only the goods and services purchased directly by “end users” or “consumers.” “Consumers” include households and governments. In certain instances, businesses are also counted as “consumers.” The vast majority of purchases by businesses does not contribute to final demand, but rather supports final demand as part of supply chains. However, one small category of business purchases is included in final demand: investment purchases, or the equipment or inventory that businesses purchase but do not sell in a given year. These definitions of “final demand” and “consumers” are consistent with national economic accounting; the consumption-based inventory relies on models derived from national economic accounts to estimate emissions.

It should be noted that “consumption” is not the same as “use.” For example, many businesses use electricity, but this use is not counted as consumption, since consumption is limited to purchases by households and governments as well as business investment purchases.
What is a “carbon dioxide equivalent”?

Different greenhouse gases, such as carbon dioxide and methane, have different impacts on climate. A “carbon dioxide equivalent” is a means by which all greenhouse gases can be expressed as a single number. For example, consistent with international convention for greenhouse gas accounting at the national scale, methane is treated as having a global warming potential of 21 over a 100-year time period; compared to a global warming potential for carbon dioxide of 1, this means that 1 kilogram of methane has an impact equivalent to 21 kilograms of carbon dioxide. The emission of 1 kilogram of carbon dioxide and 1 kilogram of methane would be treated as 22 kilograms of carbon dioxide equivalent (1 kilogram of carbon dioxide and 21 kilogram of carbon dioxide equivalent from the 1 kilogram of methane).
How are consumption-based emissions estimated?

Estimation begins with a widely used input-output model of Oregon’s and the nation’s economy. This model estimates final demand by Oregon consumers and relates it to all intermediate demand (production) by producers required to satisfy the final demand. For example, input-output models report how much sugar, flour, chocolate, natural gas, electricity, cardboard, plastic, etc. are required to produce a cookie. For each sector of the economy, existing greenhouse gas inventories are used to estimate industry-specific emissions intensities (emissions per dollar of economic activity). For each of approximately 500 sectors of the economy, these two factors (economic activity and emissions intensities) are multiplied by each other to estimate domestic emissions “upstream” of the consumer (economic production necessarily to satisfy Oregon consumption is multiplied by emissions per unit of production). These calculations are performed in parallel for in-state and other domestic production required to satisfy in-state consumption. Since an increasing faction of goods and materials consumed in Oregon is produced internationally, a separate, global input-output model is used to estimate international emissions. These estimates are then added to estimates of emissions associated with in-state consumption of energy (electricity, fuels) and emissions associated with disposal of solid waste generated in-state.

Please refer to the technical report for additional details.
Where can I view the emissions intensity data?

Estimates of emissions intensities (emissions per dollar of economic output) for different commodities are embedded in the model, which is quite complex (six linked Excel workbooks, each with 6 to 12 worksheets). DEQ may make them available in a supplemental report at a later date. If you are interested in viewing the emissions intensities in the meantime, please contact .
What’s a “rebound effect”?

A rebound effect occurs when consumers engage in a conservation activity that reduces emissions and saves them money, then subsequently spend those savings in a way that increases emissions. A classic example of this is when consumers retrofit their furnace to a more energy-efficient model but then run it longer, rationalizing that it doesn’t cost as much as it used to. However, rebound effects can also cross between commodity groups. For example, consumers might save fuel (and money) by driving less, but then use the savings to purchase more goods. Underlying data in the consumption-based inventory show that the (2005) emissions intensity (emissions per dollar of economic output) of fuel is approximately 5.8 kilograms of carbon dioxide equivalent per dollar, while the emissions intensity of materials (all materials, averaged) was approximately 0.5 kilograms of carbon dioxide per dollar. From this, one can see that if a rebound effect as described above exists, the net effect is still a reduction in greenhouse gas emissions: for every dollar that consumers shift from fuels to “average” materials, emissions fall by approximately 5.3 kilograms of carbon dioxide equivalent (a 5.8 kg decrease offset by a small 0.5 kg rebound effect).
Does the consumption-based emissions inventory only address greenhouse gas emissions, or are other emissions (such as toxics) also included?

The inventory only addresses greenhouse gas emissions.
How accurate are the results?

It is impossible to say exactly. Because the consumption-based inventory is largely derived from conventional state and national inventories, it is likely no more accurate than those inventories. Results are likely more accurate as the focus of the inventory is broader, and are less accurate as the focus becomes more refined. For example, estimates of emissions associated with all in-state consumption are likely more accurate than estimates of emissions associated with individual commodities (beer, shoes, pet food, etc.). Estimates of emissions associated with broad categories and subcategories of commodities are likely of intermediate accuracy.
What are the major limitations of the consumption-based inventory?

The inventory is derived from a model that depends on estimates of consumer, government and business spending and trade relationships based on national data scaled to Oregon. As a result, the model may not reflect significant deviations in local behaviors related to national averages.

Results also become less accurate as the level of analysis becomes narrower. No analysis is possible below the level of individual commodities (of which there are 509). The analysis is based on commodity averages and does not distinguish between competing brands within any given commodity group. Similarly, it does not distinguish between different methods of production within any given commodity (such as shade-grown vs. conventionally-grown coffee, or paper made from recycled vs. virgin pulp feedstock) or between similar products made of different materials (such as cotton vs. synthetic clothing).
Who conducted the research?

The U.S. Center of the Stockholm Environment Institute developed the consumption-based inventory, using staff based in Washington and Massachusetts.
Why didn’t DEQ hire an Oregon-based firm?

DEQ conducted a competitive recruitment. Stockholm Environment Institute was selected as the applicant that scored the highest, using the selection criteria outlined in the official solicitation. Consistent with state law and procurement standards at the time of the procurement, DEQ was unable to provide preference to in-state firms.
How much did the study/inventory development cost?

DEQ spent $95,103 for the contract to develop the model, technical report and summary report. The source of these funds was the state’s tipping fee on solid waste disposal; no general fund revenues were used. A significant portion of these costs were up-front costs associated with developing the methodology, as this type of project had not previously been performed at the level of a state or locality in the United States. Subsequent analysis, if conducted, should be less expensive.
Why was the inventory only conducted for 2005?

It typically takes several years for emissions and economic data needed to conduct an inventory to become available. For most of the duration of the research effort, state (conventional) inventory data was only available through calendar year 2005. Because the consumption-based inventory relies on conventional inventory data (to develop in-state emissions intensities), 2005 was the most recent year for which a consumption-based inventory could be produced. Shortly before the consumption-based inventory was completed, the state of Oregon updated its conventional inventory through 2008. Updated emissions estimates for 2005 were reflected in the consumption-based inventory, but resource limitations prevented DEQ from updating the consumption-based inventory to 2008.
Does DEQ plan to update the inventory for future years?

DEQ has not committed to updating the consumption-based inventory in future years. It expects to decide whether and how frequently to update the inventory based in part on response to this first (2005) inventory, and also after reviewing the costs to maintain the inventory.
Who else is doing this type of inventory?

Oregon was the first community in the United States to commission this type of inventory. As of August 2011, the consumption-based model developed by Stockholm Environment Institute has also been applied to GHG inventories for King County (Washington), the city and county of San Francisco, and the state of California.
How does this compare with Metro’s GHG inventory?

The two inventories share a few things in common, but are fundamentally different. Metro’s regional greenhouse gas inventory is different from most other community GHG inventories in that it includes an estimate of life cycle emissions of materials used in the Portland metropolitan region. This has some overlap with DEQ’s consumption-based inventory, but there are several important differences. Metro’s inventory downscales (pro-rates) elements of national inventory data to Metro conditions using population, while DEQ’s consumption-based model is derived from economic modeling. Metro’s inventory does not include foreign emissions, while DEQ’s consumption-based emission does. And Metro’s view of materials is based on materials produced in the U.S., while DEQ’s consumption-based inventory is limited to materials consumed by consumers (households, government and business capital).
Are there additional resources available for state and local governments interested in this type of inventory?

The West Coast Climate and Materials Management Forum has produced an online toolkit that provides resources to help state and local governments better incorporate materials management considerations into their inventories and climate action plans. While consumption-based inventories do not address all emissions associated with materials used in a community, they do offer a different way of understanding these emissions. The toolkit is available at: http://captoolkit.wikispaces.com/Home.

ICLEI – Local Governments for Sustainability USA is in the process of producing a national protocol for community-scale greenhouse gas inventories and reporting. Those protocols, once completed, may offer some additional guidance.

Consumption-based Greenhouse Gas Emissions Inventory for Oregon

Questions and Answers