Modeling reductions in the environmental footprints embodied in European Union's imports through source shifting

Abstract

The European Union (EU) is a major political actor advocating climate change mitigation and resource efficiency. Despite this proactive stance towards environmental issues, the majority of its footprints still exceed the planetary boundaries to a large extent. These impacts cross country borders and are thus embodied in its trade. Footprints of a given product vary significantly, according to the producing country, and therefore the footprints of the EU embodied in its imports can be reduced through source shifting. This paper studies that potential reduction. The method used is Environmentally Extended Multi Regional Input-Output analysis and the impact categories considered are carbon emissions, material, water, and land. We explore the impacts of shifting imports towards the countries with lowest impact intensities according to the four categories considered. We find that a limited set of 13 products is responsible for more than half of all impacts embodied in imports for each category. Except for a few product groups, optimizing one category reduces impact in all others. The category exhibiting the highest scope for optimization is water. Carbon and material use optimization yields the largest reduction in other environmental pressures. We discuss the implications of our findings for the development of consumption-based policies.