The Dirty Secret Behind Norway's 'Green' Economy
WHY YOU SHOULD CARE
Because there’s a lot more to environmental statistics than meets the eye.
By James Watkins
Christoffer Ringnes Klyve has a harder job than most environmental campaigners. In Norway, the discussion around det grønne skiftet — “the green shift” — focuses on a completely different set of issues than in most other countries. Because not only is Norway the most highly developed, happiest and most democratic country in the world, it’s also one of the greenest: 98 percent of its electricity comes from renewable sources (almost entirely hydropower). It also has the largest share of electric car use in the world and ranks third among rich countries for its low carbon-intensive economy, behind only Sweden and Switzerland.
Nevertheless, Klyve’s environmental organization, Future in Our Hands, counts 30,000 passionate members, the largest membership-based group in the country, fighting for even more climate action. And that’s because Norway has a giant environmental elephant in the room: It’s one of the world’s largest exporters of oil and gas, a moral stain on the country’s green image.
In fact, if you include emissions from its exported fossil fuels as part of Norway’s carbon footprint:
Norway plummets from having one of the least carbon-intensive economies among wealthy countries to having the most — by far.
That finding comes from adding the roughly 500 million tonnes of CO2 equivalents that are emitted from Norway’s annual oil and gas exports every year to the roughly 50 million tonnes that are emitted by activities within its borders. That would take it from third place on the Organization for Economic Cooperation and Development’s (OECD) list of greenhouse gas emissions per unit of GDP to dead last — by a long way.
Lots of people are uncomfortable about some of the problematic aspects of the oil sector.
Christoffer Ringnes Klyve, Future in Our Hands
Of course, other OECD countries export fossil fuels too, but none have such a proportionate effect on these stats relative to the size of the Norwegian economy and its existing low emissions rates. Calculating environmental responsibility in this way would increase resource-rich Canada’s carbon footprint by 115 percent and would triple the carbon budget of coal powerhouse Australia … but for Norway, it’s a tenfold increase.
The significance of this carbon accounting trick? Well, these numbers directly influence how we think about who has the moral duty to tackle climate change the most — and those moral debates get very real very quickly when countries like Norway have specific emissions targets under European environmental rules as well as the Paris climate agreement. “Norway doesn’t accept responsibility for these [exported] emissions,” says Robbie Andrew, a senior researcher at the Center for International Climate Research in Oslo. “I struggle to find a good analogy that doesn’t piss people off, but it’s like selling arms to a country that’s at war and committing atrocities,” and not taking responsibility because you’re not the one pulling the trigger, he says.
Crucially, this shows that counting emissions just by how much is released within a country’s borders doesn’t make sense in a globalized economy where consumption is so interlinked. For instance, although the shale gas boom in the United States has allowed the country’s emissions to fall dramatically as coal has been replaced with less-polluting natural gas, research has shown that most of that drop has been offset by the U.S. simply exporting more cheap coal to the rest of the world.
But Norway’s situation presents another paradox for environmentalists, as much of the country’s vast wealth has been built on its fossil fuel exports — its Oil Fund is the largest sovereign wealth fund in the world with more than $1 trillion of assets. “Lots of people are uncomfortable about some of the problematic aspects of the oil sector,” says Klyve, “but then it’s also been one of the main reasons why we have one of the best welfare states in the world … [and] a lot of people don’t want to compromise that.”
So Klyve’s organization, among other environmental campaigners in Norway, focuses on a more nuanced argument — that the steady flow of oil wealth may soon dry up, so diversifying makes economic, as well as environmental, sense. Environmentalists have had mixed results in the country — while the state-controlled Statoil is soon to change its name to Equinor to move away from its association with only fossil fuels, and the pension fund is looking to divest from oil and gas shares, the idea of stopping fossil fuel production altogether largely falls on deaf ears. It’s “the goose that lays the golden eggs, and we don’t know how to replace that goose,” says Andrew.
However, the ethics involved in taking responsibility for one’s fossil fuel exports are far from black and white. Some argue that if Norway didn’t export these fossil fuels, then someone else would, so Norway shouldn’t be blamed for capitalizing on its resources while keeping its own internal emissions low. Indeed, it also invests hundreds of millions of dollars in forestry programs across the world, from Brazil to Indonesia. In this moral maze, the state hopes that profiting off the fossil fuel industry while investing in the green revolution makes them the good guys on net, but for Klyve, it’s little more than “camouflage.”
This moral dilemma could grow into a full existential crisis for the country’s economy: Ironically, by being a world leader of the electric car industry, “we’re driving a trend that will in the long run undermine the market for Norway’s main export product,” says Klyve. It’s “a huge national dilemma.”