Japanese economist Yoichi Kaya famously expressed CO2 emissions as the product of four socioeconomic factors: population, per-capita income, the energy intensity of the production, and the carbon intensity of energy. Understanding the implications of the Kaya Identity requires an appreciation for the extreme tension between economic development and the climate imperative of deep decarbonization and also its unprecedented opportunity for historical transformation. Billions of people are climbing out of abject poverty at the same time that fossil fuels are being rapidly eliminated. Success means maturation and sustainability of human civilization. Failure means catastrophic collapse.
World population growth is plummeting as hundreds of countries undergo a demographic transition that matches declines in child mortality with 2-child families. The fraction of people living in extreme poverty has fallen 10-fold in 200 years, 50% since 1990, and could realistically fall to zero in a generation. Economic growth in the richest 10% is limited by technological innovation at about 1% above inflation, but middle- and low-income countries grow much faster due to “catch-up” growth. This economic convergence is the key to stabilizing world population and provides the opportunity for sustainable prosperity.
Economic convergence moves societies toward much lower energy intensity — as economies develop, less energy is used per unit of income. The energy intensity of middle- and high-income countries has improved by about a factor of two over my lifetime and there is scope for further improvement.
Every factor in the Kaya identity has been improving except for the carbon intensity of energy, which has barely budged in 30 years. Spectacular improvements in Population, converging income, and energy intensity have paved the way to a sustainable future but it is now imperative to decarbonize energy systems.
Global carbon emissions dropped about 7% in 2020 due to the COVID-19 pandemic, showing that even severely restricted activity can’t achieve the deep reductions necessary to stabilize climate.