We’re greener than we think

Following last week’s release of the most definitive report on climate change, global warming is back in the news.

Among other things, there have been articles highlighting the risks to Canada, provocative calls to action, and a pretty cool tool that shows how much warming people can expect during their lifetime.

All this talk of climate change can be pretty sobering and, quite frankly, depressing. That’s why it’s important to remember that, although we have a long way to go, we are making progress here in Canada and elsewhere.

Case in point, according to a TD Economics report released today, we’re greener than we think. Over the past 20 years, emissions intensity (the amount of carbon pollution emitted per dollar of GDP) has dropped by 30 per cent in Canada.

Yes, Canada’s overall emissions have been climbing, but not at the same rate as our economy has been growing. This is good news. It means we’re beginning to break the relationship between economic growth and environmental degradation.

As the report points out, this progress can be hard to see because, for one thing, there is no agreed upon definition of the green economy. Rather, two types of definitions prevail. One that implies the green economy is a part of the economy; for example, the solar sector, or electric car manufacturers. The other definition is more holistic, and tends to look at the sum total of our activities that contribute to improved environmental performance.

We agree that having a single definition would provide greater clarity. Unfortunately, both prevailing definitions are flawed. The first one is easy to measure, but by looking at only a part of our economy, it doesn’t give us the whole picture. And when we define the green economy so narrowly, it looks smaller and less significant than it really is.

The other definition, the holistic approach, can show us the big picture, but it’s practically impossible to measure. We can look, as TD did, and see that our economy is becoming less destructive to the environment per dollar spent, but it’s very difficult to say how this impacts our economy itself. For example, we don’t know how many people are employed in this green economy, or how these green activities contribute to economic growth.

The authors of TD’s report suggest that, given these competing and flawed definitions, we should start talking about the “greening of the economy,” rather than “a” or “the” green economy. And we should develop metrics to measure our progress at greening the economy and monitor the economic and environmental benefits that flow from it. I think they’re on to something (and in fact, I’ve made this case before).

It’s great to see a big Canadian bank like TD adding their voice to the chorus calling for a greener economy. If we hope to see more progress in Canada, it’s critical that we all understand, as TD appears to, that the environment and the economy are not at odds with each other. Rather, in TD’s words, “the environment is a key component of the economy.”