CARBON EMISSION ACCOUNTING IN MRIO MODELS: THE TERRITORY VS. THE RESIDENCE PRINCIPLE

Consumption-based CO2 emissions, which are commonly calculated by means of environmentally extended input-output analysis, are gaining wider recognition as a way to complement territorial emission inventories. Although their use has increased significantly in the last years, insufficient attention has been paid to the methodological soundness of the underlying environmental extension. This should follow the internationally agreed accounting rules of the System of Environmental-Economic Accounting, which addresses the activities undertaken by the residents of a country, independent from where these take place. Nonetheless, some footprint calculations use extensions that account for all the activities within the territory, which leads to methodological inconsistencies. Thus, this article introduces the most relevant conceptual differences between these accounting frameworks and shows the magnitude of the gap between them building on the data generated for the EXIOBASE model. It concludes that the differences are high for many countries and their magnitude is increasing over time.