Greenhouse Gas (GHG) Emissions Intensity calculates the amount of GHG emissions released for a certain output such as emissions per dollar of revenue or Megawatt of energy generated.
GHG Intensity is primarily about efficiency rather than total emissions. Measuring GHG Intensity can be a useful tool to find areas of improvement or assess the efficacy of new carbon-reducing projects. For example, if a company sees that one arm of their business is generating far more emissions per dollar of value added, that could be a good place to begin decarbonization efforts; similarly, if a company has already begun decarbonization efforts, it can use GHG Intensity to check whether each output is actually producing less carbon or if they are simply producing less items.
Emissions intensity can, at times, obfuscate decarbonization efforts by putting a positive spin on increases in total emissions. Intensity encourages unlimited growth – economies of scale mean that larger operations may be able to produce the same good with less emissions – but per unit measurements inadequately account for the fact that reducing total emissions is the most important factor to mitigating climate change. In fact, overreliance on Intensity can have counterproductive consequences when companies overlook the total emissions associated with increasing production. Even if Intensity has decreased, companies may be producing more than necessary, leading to an overall increase in emissions, or may be inducing demand[1] for products that consumers otherwise would not purchase. Though GHG Intensity is an important metric to reducing emissions, it should be contextualized with figures about total emissions.
[1] Induced demand is the idea that increasing supply may artificially increase demand for a good that consumers would be better off demanding less of. For instance, building a new highway will make trips easier, inducing more people to drive more often. This is the reason why adding new lanes to highways very rarely decreases traffic in the long run: more lanes mean more cars taking more trips which balances out the increased capacity from the new lane. Similarly, fossil fuel companies may induce demand in their products by building out pipelines and transmission networks so energy is cheaper and people use more of it. Leaving the lights on when you leave a room is more manageable if it costs you $0.01 than if it costs $1 or $100. Therefore, increasing efficiency can make people demand more in total which, in the case of carbon emissions, defeats the initial purpose of efficiency.
