Green Growth Indicators

Paul Schreyer

National Accounts Working Party

3 December 2010

Background

• Ministerial Council Meeting (MCM) 2009: GG declaration inviting the OECD to develop “a Green Growth Strategy (GGS) in order to achieve economic recovery and environmentally and socially sustainable economic growth”

• Main outputs for the 2011 MCM:– GGS report– Report on indicators

• OECD Council oversees the GGStrategy

• Additional consultations: CSTAT, WGEIO=> Deadline for 1st round of written comments: December 6

1. Framework for GG indicators

• Green Growth?– Pursuing economic growth and development while

minimising pressures on the quality of the environment and on the use of natural ressources

– Harnessing the growth potential that arises from adressing environmental concerns

• Whose growth? – Household perspective and people’s well-being to

complement GDP and production perspective

1. Framework for GG indicators

• Production-related measures are still useful……. But we need to make progress with an extended accounting framework

(introducing environmental services into the production function, distinguishing between substitution and multifactor productivity, bridging the GDP and alternative measures of material well-being)

• Consumption-related indicators complement the picture– Environmental efficiency of final demand (including direct

and indirect environmental services) when looking at issues of a global nature

– Monitoring patterns of household and government consumption

1. Framework for GG indicators• Looking at environmental assets is needed to monitor to

what extent the asset base is being maintained (quantity, quality, value)

• When looking at the Growth side of GG, we want to capture growth opportunities from environmental considerations

=> 5 dimensions to monitor GG:• 1. Environmental efficiency of production• 2. Environmental efficiency of consumption• 3. Natural asset base of the economy• 4. Environmental dimension of quality of life• 5. Society’s responses and economic opportunities

2. Links with National Accounts• Where applicable, use of concepts of SEEA

• Key measure: CO2 embodied in imports and exports

Presentation by Nadim Ahmad

3. Two headline indicators for climate change

• CO2 efficiency of production

Production-based CO2 intensity =

- Prime indicator of decoupling- Reflective of the efficiency with which energy from

fossil fuel is used as an input in domestic production- Representative for other environmental issues

GDPVolume

productiondomesticfromemissionsCO2

3. Two headline indicators for climate change

• CO2 efficiency of consumption

Demand-based CO2 intensity =

Total CO2 emissions = emissions from domestic production + emissions embodied in imports - emissions embodied in exports

- Inform on the possible substitution of CO2 from production through purchases abroad

- Introduce a measure of income rather than a mesure of production for the denominator => Reflect the emission intensity of the generation of one real dollar of income

incomedisposablenationalnetal

emissionsCOTotal

Re2

Next steps• Broader internal consultation at

OECD• Revision of present document• New complete draft for GG

Workshop 10-11 February 2011• Finalisation and submission to

Ministerial Meeeting end of May 2011