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DailyClimate.org: Households top industry in emissions; green investment up

April 21, 2010 | 12:13 pm

DailyClimate.org reports:

Green investments are spurring significant growth across the U.S economy while decreasing industry's overall emissions per dollar of goods and services, according to two reports released Wednesday by the federal government.

Meanwhile, households have replaced industry as the country's largest source of carbon dioxide emissions, according to government data.

The first report defines and measures the size of the domestic green economy; the other assesses how America's greenhouse gas emissions have changed over the past decade. Together they provide "valuable analytic tools" necessary to understand the emerging green economy and guide future policy, said Rebecca Blank, undersecretary for economic affairs at the U.S. Commerce Department.

"There are many unknowns about how we are going to build a new energy economy," she said during a press conference unveiling the data. "These reports suggest we are making some progress."

The first report, "Measuring the Green Economy," analyzed the most recent Economic Census, produced in 2007 by the Census Bureau, and found green services and products totaled between $371 billion and $571 billion, or 1 percent to 2 percent of the U.S. economy that year.

That's a small slice of economic pie, Blank acknowledged. But the sector is "well-poised" for growth, and the agency expects the next economic census, in 2012, will show significant gains. "We are standing in front of a fire hose of business," said Sandy Wiggins, president of E3 Bank, which aims to redirect capital to the green economy and expects to make its first loan in July. "I don't think there's a single industry that can't benefit from this transition."

The second report, "U.S. Carbon Dioxide Emissions and Intensities Over Time," shows that a considerable number of economic sectors - particularly manufacturing - have grown more energy efficient over time.

The report's innovative feature, Blank said, is its analysis not just of total emissions, but emissions per dollar of economic output - what the agency calls "CO2 intensity."

"As CO2 intensity falls, (we can say) a sector is becoming more efficient," she said. "We can see what industrial sectors are becoming more efficient over time." Overall domestic carbon dioxide emissions have grown slightly over the past few decades, according to federal figures. But the economy has grown faster, suggesting it is becoming more energy efficient over time.

The analysis has uncovered some significant trends within the economy that will help guide policy, Blank said. For instance, in 1998 manufacturing emitted more CO2 than any other sector, accounting for 30 percent of total domestic emissions. But by 2006, households had become the largest emitting sector.

During those years, while manufacturing was reducing emissions per dollar of output, household CO2 emissions increased almost 13 percent, from 1.6 billion tons of CO2 to 1.8 billion tons.

"This underscores the value of energy efficiency programs, as well as the Energy Star program," Blank said, adding that she expected household emissions to have improved from 2006 to 2010, given recent government incentives to weatherize and improve efficiency.

Manufacturers are getting that message, said Bruce Quinn, vice president of Rockwell Automation, a Milwaukee-based manufacturer of factory automation equipment. Quinn said a "fundamental shift" is underway in industry: so-called "sustainable manufacturing" is no longer seen as a social responsibility, but as an economic and competitive necessity.

The days when managers accepted high energy bills as an unfortunate but necessary cost of doing business are gone, he added. Today manufacturers view energy demands, he said, "as a specific input to production, much as they do with other components such as materials and labor."

Together, the reports shed light only on historical trends, Blank acknowledged. They don't yet assess the return on the Obama administration's multi-billion-dollar investment, via the stimulus program, in the green economy.

But they will, Blank said. "We must know where we are starting from in building the green economy," she said. "These reports give us benchmarks about the recent past, and green yard sticks to measure progress in the future."

DailyClimate.org is a nonprofit news service that covers climate change.

-- Douglas Fischer, DailyClimate.org

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