Consumption and the environment - SOER 2010 thematic assessment

Consumption is shaped by an array of complex, interrelated factors such as demographics, income and prices, technology, trade, policies and infrastructure, as well as social, cultural and psychological factors. Production activities across economic sectors, including extractive industries, agriculture, energy, transport and manufacturing, are directly responsible for the majority of the environmental impacts caused by the economy. However, it is private and public consumption that are the fundamental causal factors and drivers of change in production activities.

Consumption leads to the direct creation of environmental pressures from the use of products and services, for example, through driving a car or heating a house with fossil fuels. Of greater magnitude, however, are the indirect pressures that are created along the production chains of the goods and services consumed, including, for example, food, clothing, furniture or electricity. Both direct and indirect pressures result in environmental impacts, in particular, global warming, biodiversity degradation, soil sealing and air and water pollution. Since an increasing share of the final and intermediate goods consumed in Europe is imported, a growing proportion of impacts caused by our consumption takes place in other parts of the world. The average environmental footprint (an indicator of pressures from consumption) per person in EEA member countries is about double the available biocapacity (an indicator of land which is biologically productive) of those countries.

An EEA analysis of nine EU Member States (representing 268 million of the EU's total 501 million people) has found that the majority of key environmental pressures caused by total national consumption can be allocated to eating and drinking, housing and infrastructure, and mobility. These three broad consumption areas are estimated to have contributed approximately two-thirds of consumption-related material use, greenhouse gas emissions, acidifying emissions and ozone precursor emissions.

The reasons for these high shares are that food and drink, housing and mobility are the areas which Europeans spend most on and at the same time the areas with the highest pressures per euro spent. Tourism is a fourth area causing high and growing environmental impacts, both within the EU and elsewhere.

A major reason why consumption negatively affects the environment and causes an over-use of resources is because the costs to society of environmental and resource degradation are not fully reflected in the prices of goods and services. Thus, many goods are relatively cheap even though they cause major harm to the environment, ecosystems or human health.

A culture of high and continuously growing levels of consumption, generally associated with well-being and success, has evolved in western European countries for decades, and EU-12 Member States and the western Balkan countries are rapidly catching up.

Large differences in environmental pressures from consumption, even between households with equal income levels, indicate a considerable potential for more sustainable consumption patterns through shifting choices towards more sustainable alternatives. Examples include: shifting from car use to collective transport, cycling and walking; and choosing high quality and eco-labelled products and energy-efficient housing solutions. Secondly, additional income could be channelled towards products and services with relatively low environmental pressures such as communication, education and sustainable leisure activities.

Europe will be better equipped to achieve sustainable consumption patterns by developing and implementing sophisticated policy packages. These would include regulatory and voluntary instruments, providing sustainable infrastructure, technological support, consumer education and information, and green public procurement (the purchase of goods, services and public works by governments). A critical element of such policy packages could be provided by ecological tax reform, where the burden of taxation is shifted from labour to environmentally damaging activities.

The framework conditions should enable business and consumers/citizens to act sustainably, and business and citizens need to take action by adopting more sustainable consumption and production patterns.