Six key factors, combined with the impacts of a prolonged economic slowdown, have led U.S. CO 2 emissions to fall to 1996 levels, making significant progress toward the long-abandoned Kyoto Protocol 1990 target. Is it conceivable that U.S. CO 2 emissions may actually have peaked?

U.S. carbon dioxide (CO 2 ) emissions have fallen nearly 12 percent over the past five years, and are currently down to 1996 levels. While some reduction is attributable to the economic downturn between 2008 and 2010, the continuing decline up to present suggests that additional and more persistent factors are at work.

A close examination of energy use in different sectors suggests that the transition from coal to natural gas for electricity generation has probably been the single largest contributor to the decline, but a combination of many other factors accounts for the majority of reductions. These include people driving less and flying less, using less electricity (particularly for industrial activities), driving more fuel-efficient cars, and a large increase in the use of wind power for electricity. Some of those factors also stem from the economic slowdown, but all combined, these factors have produced a dramatic and largely unexpected decline in U.S. CO 2 emissions.



Figure 1: U.S. monthly CO 2 emissions from energy, January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles. Note that the y-axis begins at 415 million metric tons (MMT).

U.S. carbon emissions have declined at an impressive rate given the absence of any cohesive federal climate change policy. The U.S. has actually managed to make significant progress toward its long-abandoned Kyoto Protocol target to reduce emissions 7 percent below 1990 levels.

It is important to note, however, that this analysis concerns itself only with CO 2 from energy, and not with CO 2 emissions from land use changes or other greenhouse gases. But CO 2 emissions from energy comprise upwards of 90 percent of total greenhouse gas emissions, and emissions from most non-CO 2 greenhouse gases also have been declining in recent years, so a more thorough assessment of all sources of greenhouse gases over the past decade would likely lead to similar results.

To understand how these CO 2 emission reductions have come about, one might first review just how energy is used in the U.S.



Figure 2: U.S. monthly CO 2 emissions from energy by sector, January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles.

There are five sectors that use energy and emit carbon dioxide. The largest of these by far are electricity generation and transportation. Electricity generation burns coal, oil, and natural gas, while transportation is primarily oil-based. Industrial is the next largest, consisting of on-site fuel consumption of industrial processes (including on-site electricity generation for internal use), while residential and commercial emissions primarily involve natural gas and oil use for space and water heating.

The largest declines have occurred in the electricity sector, followed by the transportation sector. To analyze what caused these declines, it’s helpful to focus on each sector in depth, creating an alternative scenario in which behaviors, technologies, and fuel mixes stayed at 2005 per-capita values. With this approach, one can examine individual factors in turn to show how much CO 2 reduction is attributable to each.

Transportation

Transportation is the second largest source of U.S. carbon emissions after electricity generation. It is comprised of personal vehicles, corporate fleets, freight trucks, airlines, private jets, trains, subways, busses, ships, and any other mobile emission source.

Reductions in transportation sector emissions have primarily come from three sources: people are driving less, the vehicle fleet is becoming more energy-efficient, and air travel traffic has declined while the aircraft themselves have become more fuel-efficient.

Driving Less

U.S. vehicle miles travelled per person increased dramatically over the past 40 years, from around 500 miles per month in 1973 to nearly 850 miles per month in 2007. After 2007, however, both miles driven per-person and total miles traveled began to decline. As of 2013, people are traveling about 7 percent fewer miles than they did five years ago.



Figure 3: U.S. monthly miles driven per capita, January 1973 through March 2013 with a 12-month lagging average applied to remove seasonal cycles.

Comparing this observed behavior to a counterfactual world in which miles driven per-capita had remained at 2005 values and vehicle fuel-economy had remained constant, one can estimate the effect reduced miles driven alone would have had, as shown in Figure 4 below. That graphic displays actual transportation sector CO 2 emissions in black and the additional CO 2 emissions that would have occurred if miles driven had not changed in teal.



Figure 4: U.S. monthly CO 2 emissions from transportation, January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles. Estimated reductions due to reduced miles driven are shown in teal. Note that the y-axis begins at 130 MMT.

Fuel Efficiency

Along with reduced vehicle miles travelled, the cars and trucks also have become more efficient. Contrary to some claims, however, the increases in fuel economy in recent years across the entire U.S. vehicle fleet actually have been relatively modest. Fuel economy in this case is calculated by dividing the total monthly vehicle fuel consumption (both gasoline and diesel) by the total miles driven by all vehicles.



Figure 5: U.S. average vehicle fuel economy by month from January 1973 through March 2013. Based on transportation sector gasoline and diesel fuel consumption data from the EIA and miles traveled data from the U.S. Department of Transportation.

To estimate effects of fuel economy changes, consider a counterfactual scenario in which miles driven and fuel economy both remain fixed at 2005 levels. This approach leads to the results shown in Figure 6 below.



Figure 6: U.S. monthly CO 2 emissions from transportation, January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles. Estimated reductions due to increased fuel economy are shown in pale red.

While significant, transportation sector CO 2 reductions from increased vehicle fuel efficiency are fairly small compared to reductions resulting from people driving recently strengthened fuel economy standards, as they are phased in over coming years, unquestionably will have a larger effect on the vehicle market.

Flying Less (and More Efficiently)

In addition to driving fewer miles per-person, Americans have been flying less over the past decade, and high fuel prices have led airlines to focus more on fuel efficiency. Consider combining both factors into a simple measure of airline fuel use per person per month. Significant declines are evident both after the September 11th terrorist attacks and after the 2008/2009 recession. Interestingly, fuel use per person never recovered from these drops, and has fallen even faster in recent years.



Figure 7: U.S. average vehicle fuel economy by month from January 1973 through March 2013. Based on transportation sector gasoline and diesel fuel consumption data from the EIA and miles traveled data from the U.S. Department of Transportation.

To tease out the combined effects of people flying less and airlines increasing fuel efficiency, it’s useful to consider an alternative scenario where aviation fuel use per person remains pegged at 2005 levels. By comparing this approach to actual fuel use, one can estimate the transportation sector carbon emission reductions, as shown in Figure 8 below.



Figure 8: U.S. monthly CO 2 emissions from transportation, January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles. Estimated reductions due to reduced miles flown and increased airplane fuel efficiency are shown in sky blue.

Overall Transportation CO 2 Reductions

Combining estimated reductions from reduced miles driven, increased vehicle fuel economy, and air travel-based reductions offers a good picture of their relative importance and what the transportation sector might have looked like in the absence of these factors.



Figure 9: U.S. monthly CO 2 emissions from transportation, January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles. Estimated CO 2 reductions from three identified factors are shown.

These three factors have been responsible for a decline in transportation CO 2 emissions of around 10 percent relative to a scenario in which none of the three had occurred. Miles driven was responsible for the bulk of reductions, followed by changes in air travel. In recent years, however, the effects of fuel economy have increased to rival those of air travel, and will likely eclipse them in the next few years.

Not a complete analysis of the entire transportation sector, this approach leaves out other sources including public transportation and shipping. Future work could add in estimates of changes in emissions from these sources and disentangle the effects of airline miles traveled and fuel efficiency so each factor can be quantified separately.

Electricity Generation

Electricity is the single largest sector contributing to U.S. CO 2 emissions, and also the focus of the largest changes over the past five years. Emissions from electricity include all direct CO 2 emissions from the combustion of coal, oil, and natural gas for electricity generation, but they do not include indirect emissions from methane leakage, powerplant construction, mining, or other factors.

Natural Gas

The rapid increase in domestic natural gas production in the U.S. over the past 5 years has led to a rapid transformation of how electricity is produced. Coal has lost its perch as the undisputed champion of power generation, falling from 50-plus percent of total electricity generation to around 35 percent. Natural gas has grown from only 15 percent of total generation in 2005 to 30 percent in 2012.



Figure 10: U.S. monthly electricity generation by fuel from January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles.

While natural gas is still a carbon-emitting fossil fuel, it emits far less carbon than coal. Its molecular composition means that for a given unit of heat produced, natural gas results in slightly more than half the carbon emissions as coal. Additionally, heat from natural gas can be converted into electricity with a much higher efficiency (around 60 percent) than coal (between 30 and 40 percent). The combination of these two factors means that a kilowatt hour of electricity from natural gas has only about one-third the direct CO 2 emissions as a kilowatt hour generated from coal. Even accounting for indirect emissions from methane leakage, based on the latest figures from the EPA, electricity from natural gas still emits only about 40 percent of the carbon dioxide-equivalent emissions of coal.

Assuming that energy consumption per capita and grid fuel mixes remain fixed at 2005 levels, one can create an alternative scenario to estimate the reductions from natural gas. Assume here that natural gas has directly offset coal-based generation, as both are effective sources of reliable base-load generation.



Figure 11: U.S. monthly CO 2 emissions from electricity generation, January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles. Estimated CO 2 reductions from substituting coal for natural gas are shown in dark blue. Note that the y-axis begins at 150 MMT.

Wind

While not growing at quite the same speed as natural gas, wind generation has also expanded rapidly over the past five years, increasing from less than 1 percent of total U.S. generation in 2007 to 4 percent in 2012. Unlike natural gas, wind generation is effectively carbon free.



Figure 12: U.S. monthly wind electricity generation from January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles.

Wind generation is, however, intermittent, and it often cannot be used to directly displace coal baseload generation. Instead, wind often displaces generation sources like natural gas and oil. So assume here that increases in wind generation result in carbon reductions that reflect the average 2005 grid mix (which was a bit over 50 percent coal). So comparing a scenario in which wind power remained at its 2005 percent of generation with what has actually occurred, one can estimate the carbon reductions attributable to the expansion of wind power.



Figure 13: U.S. monthly CO 2 emissions from electricity generation, January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles. Estimated CO 2 reductions from expanded wind generation are shown in light blue.

Energy Efficiency

In addition to changing how we produce energy, Americans are also using less energy per person. So despite the growing U.S. population, energy consumption has remained relatively flat over the past five years. Figure 14, below, shows actual U.S. electricity consumption compared to a scenario in which 2005 per-capita usage had remained constant.



Figure 14: U.S. monthly electricity consumption from January 1973 through December 2012 with a 12-month lagging average applied to remove seasonal cycles. An alternate scenario is shown where per-capita consumption is pegged to 2005 values.

This decline is not primarily the result of people switching off light bulbs. Rather, the largest driver of declining per-capita electricity use is declining use in the industrial sector. As the U.S. economy increasingly moves away from heavy manufacturing, electricity use per person in that sector is falling quickly. The industrial sector also had larger declines as a result of the recent recession than other sectors. That said, residential and commercial consumption per-capita have also declined slightly in recent years.



Figure 15: U.S. monthly per-capita electricity consumption by sector from January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles.

To estimate CO 2 reductions attributable to increased energy efficiency (and reduced industrial electricity use), consider what actually has happened to a world in which grid fuel mixes had remained at 2005 levels, changing only energy use per-capita. The results are shown in Figure 16, below, with the brown band representing estimated reductions resulting from lower per-capita electricity use.



Figure 16: U.S. monthly CO 2 emissions from electricity generation, January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles. Estimated CO 2 reductions from reduced energy use per-capita are shown in brown.

Overall Electricity CO 2 Reductions

Combining all three sources of estimated CO 2 reduction in the electricity sector into a single plot helps analysts compare their relative magnitudes and get a sense of what the world might have looked like in the absence of these factors.



Figure 17: U.S. monthly CO 2 emissions from electricity generation, January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles. Estimated CO 2 reductions from three identified factors are shown.

Without the effects of natural gas, wind, and energy efficiency, CO 2 emissions from the electricity sector would likely have continued to increase in line with past trends. In 2012, we would have had electricity sector CO 2 emissions almost 20 percent higher than today’s emissions.

Overall CO 2 Reductions

Examining total U.S. CO 2 emissions from energy, one sees that the six factors identified (miles traveled, fuel economy, air travel, natural gas, wind, and energy efficiency) are responsible for the bulk of the reduction in CO 2 emissions. Without their combined effect, emissions would be about 12 percent higher than what was actually observed.



Figure 18: U.S. monthly CO 2 emissions from all energy sources, January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles. Estimated CO 2 reductions from six identified factors are shown.

These six factors, while some of the largest, are not the only things influencing U.S. CO 2 emissions. Declining industrial sector non-electric energy use is also an important contributing factor that is not addressed in this analysis. It is also important to put these declines in perspective. The figures in this article show declines relative to a (roughly) 1990 baseline. The figure below shows the declines relative to total U.S. CO 2 emissions.



Figure 19: U.S. monthly CO 2 emissions from all energy sources, January 1990 through December 2012 with a 12-month lagging average applied to remove seasonal cycles. Estimated CO 2 reductions from six identified factors are shown. Note that the y-axis begins at 0.

Understanding the drivers of the recent surprising and welcome decreases in U.S. CO 2 emissions is critical to experts’ and policy makers’ understanding of what the future may hold. While the U.S. economy has been recovering from the recent recession, CO 2 emissions have continued to decline. Factors like natural gas, wind, and vehicle fuel economy will likely continue to play a large role in driving future reductions. And even factors like reduced energy use per-capita and travel patterns show no signs of returning to 2005 levels. It is too early to tell for certain, but perhaps a case can now be made that U.S. CO 2 emissions may have peaked.