Shifting Investment-Driven Consumption Emissions

Consumption emissions and income inequality

Consumption emissions are highly uneven across income groups, with the wealthiest 1% contributing disproportionately due to unsustainable lifestyles and consumption patterns. This leads to significantly high levels of emissions. Additionally, the richest 10% face challenges in reducing their emissions due to structural obstacles and “lock-ins” within socio-technical systems. These constraints negatively impact individual consumption decisions from a sustainability perspective.

For example, decisions to purchase fossil fuel-powered vehicles are influenced by external factors such as the lack of affordable electric vehicles, insufficient charging infrastructure, inadequate public transportation investment, and a shortage of affordable housing near workplaces. These choices are further shaped by government priorities, such as investing in car parking infrastructure instead of public transport, or private investors choosing to build more gasoline stations instead of electric charging stations.

These scenarios illustrate the interconnection between three key dimensions of consumption emissions: household consumption, public expenditure and capital investments. However, the broader implications of interactions among individuals, governments and private investors, combined with existing power dynamics in financial and resource investment decisions, have not been systematically assessed. Moreover, detailed data on these dimensions is lacking beyond the global level, hindering a nuanced understanding of the activities and processes contributing to the lock-in of consumption emissions.

The Shift-ICE project

The Shift-ICE project aims to illuminate how household consumption, public spending and capital investments drive consumption-based emissions in both low- and high-income countries. The transport sector is used as a case study to analyse how governmental and private investment decisions influence household consumption patterns across income levels.

By comparing low- and high-income countries, the project explores structural differences and the impact of geopolitics, as well as institutional and individual actors, on consumption-based emissions. The study also aims to provide insights on addressing these structural challenges at a global level within the context of international climate policy.

Objectives and implications

The project seeks to inform targeted policy measures to reduce unsustainable investments and consumption-related emissions, contributing to the development of more effective and equitable climate policies aligned with the Paris Agreement. It also aims to enhance the availability and use of data on carbon emission inequalities through targeted communication and collaboration, including seminars, workshops and roundtable discussions.