Craig Simmons, Chief Technical Advisor at Anthesis, explores how the latest standards may help in the fight to reduce emissions.

More than 30 years ago, economists Daniel Khazzoom and Leonard Brookes theorised that attempts to increase energy efficiency may paradoxically lead to increased energy consumption and a rise in the associated greenhouse gas emissions.

In other words, policies and actions intended to reduce energy use could, unintentionally, have the opposite effect. The Khazzoom-Brookes Postulate, as it became known, can be summarised like this:

If you improve energy efficiency, you lower the cost associated with energy use. This can then, in turn, caused a rebound effect encouraging increased consumption, displaced consumption, more economic growth and/or unlock the market for new energy using products.

Take the simple example of a policy aimed at improving the fuel efficiency of aircraft – a worthy goal. Since fuel makes up more the half cost of air travel, reducing fuel consumption would reduce ticket prices potentially leading to more frequent air travel, more scheduled flights and the opening of new routes. All of these actions will invariably result in increased fuel use – the exact reverse of the original policy intent.

At the macro-level – at least – the Khazzoom-Brookes Postulate seems to hold true. The advent of the Watt’s steam engine did not reduce coal consumption, US car fuel efficiency standards merely appear to have led to American’s driving further and UK household energy use is still creeping up despite a gentle decline in average household and individual energy consumption.

So, where does this all leave policy-makers and business strategists struggling to make the right choices and deliver genuine energy and carbon reductions? Two new standards from the creators of the international Greenhouse Gas Protocol may just help.
• Policy and Action Standard (PAS) – sets out a methodology for estimating, accounting and reporting the greenhouse gas effects of policies and actions.
• Mitigation Goal Standard (MGS) – sets out a standardised approach for assessing progress towards national and subnational greenhouse gas reduction goals.

Whilst the latter is aimed fairly and squarely at local and national governments, the former has a far wider audience extending to financial institutions, funding bodies, NGOs and private sector organisations. In fact, anyone who wants to estimate, measure and/or monitor the GHG impacts of an intervention.

The PAS is flexible in that it can be used before, during or after any intervention and is designed to be used alongside other established GHG accounting and reporting standards such as the GHG Corporate Protocol. It bears many similarities with the GHG Protocol for Project Accounting which, essentially, does the same job at a project – rather than policy – scale. For example, one would use the Project Protocol for looking at the GHG changes due to installation of a new Combined Heat and Power Plant, but the Policy Standard for assessing the wider impact of corporate or sector-wide policy on the deployment of CHPs.

I previously used the Project Protocol for assessing reductions against a baseline for the London 2012 Games and found it extremely useful. By following the same basic approach the PAS treads a well-trodden path using baseline and alternate scenarios to express and evidence trends. In fact, much will be familiar to users of the Project Protocol.

Importantly for Messrs. Khazzoom and Brookes, the accounting methodology requires a clear statement on both the GHG effects and non-GHG effects of any policy intervention thus making both intended and unintended consequences visible. The need for a clear understanding of cause and effect is also emphasised. As the PAS notes, “A correlation between a policy being implemented and emissions decreased is not sufficient to establish causation.”

The Mitigation Goal Standard (MGS) will undoubtedly be well used by sub-national region and local Governments looking to adapt and deploy national IPCC-based inventories and targets.

Importantly, as its name suggests, the MGS goes beyond inventory accounting to provide support on the development of mitigation goals. The MGS has been designed to be used alongside the PAS; which would be used to first assess a range of possible policy interventions.

Both PAS and MGS are welcome additions to the armoury of tools available to those tasked with measuring and monitoring the effectiveness of policies and practices aimed at reducing and mitigating greenhouse gas emissions. If we are to avoid falling into the paradoxical trap first identified by Khazzom and Brookes, we need to take such matters very seriously.