Accounting for Greenhouse Gas Emissions Associated with the Supply of Fossil Fuels

This briefing by the Stockholm Environment Institute explores extraction-based emissions accounting as a method to track greenhouse gas emissions associated with the supply of fossil fuels, contrasting it with traditional territorial and consumption-based frameworks to better assess economic risks and producer responsibility.

• Traditional climate policies and GHG inventories primarily use "territorial" accounting, which focuses on the demand side by quantifying emissions at the point of combustion or distribution. This approach creates a conundrum where countries can expand fossil fuel infrastructure and supply with minimal impact on their own emissions accounts, as production typically accounts for only about 5% of CO2 emissions compared to 85% from combustion.
• Extraction-based emissions accounting attributes CO2 emissions from burning fossil fuels to the country where the fuels are extracted. This method reflects a principle of producer responsibility and can be implemented by multiplying primary energy extraction data for coal, oil, and gas by carbon contents, adjusted for non-combusted fractions.
• Extraction-based accounting can serve as a measure of "low-carbon competitiveness." Countries whose extraction-based emissions significantly exceed their territorial emissions may face higher economic risks, particularly if global demand for high-carbon exports like coal and oil declines due to climate policies or carbon pricing.
• Life-cycle assessment (LCA) provides a more detailed view than simple extraction-based accounting by evaluating emissions across the full chain from extraction to combustion. For instance, upstream emissions for crude oil from Canadian oil sands or Venezuelan heavy oils are approximately three times higher than those for conventional light crude from Saudi Arabia, representing up to 30% of the fuel's combustion emissions on a CO2e basis.
• Extraction-based accounting can assist countries developing Low-Emissions Development Strategies (LEDS) or "green growth" initiatives by providing a more complete picture of their global GHG contributions, helping them weigh the immediate revenue of fossil fuel exploitation against the need to leave fuels in the ground to avoid dangerous climate change.

APA

Erickson, P., & Lazarus, M. (2013). Accounting for Greenhouse Gas Emissions Associated with the Supply of Fossil Fuels. Stockholm Environment Institute. https://www.sei.org/mediamanager/documents/Publications/Climate/SEI-DB-2013-New-fossil-fuel-economy-2.pdf

Chicago

Erickson, Peter, and Michael Lazarus. Accounting for Greenhouse Gas Emissions Associated with the Supply of Fossil Fuels. Stockholm Environment Institute, 2013. https://www.sei.org/mediamanager/documents/Publications/Climate/SEI-DB-2013-New-fossil-fuel-economy-2.pdf.

Wikipedia

{{cite report |last1=Erickson |first1=Peter |last2=Lazarus |first2=Michael |title=Accounting for Greenhouse Gas Emissions Associated with the Supply of Fossil Fuels |publisher=Stockholm Environment Institute |date=2013 |url=https://www.sei.org/mediamanager/documents/Publications/Climate/SEI-DB-2013-New-fossil-fuel-economy-2.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{erickson2013accounting, author = {Erickson, Peter and Lazarus, Michael}, title = {{Accounting for Greenhouse Gas Emissions Associated with the Supply of Fossil Fuels}}, institution = {Stockholm Environment Institute}, year = {2013}, url = {https://www.sei.org/mediamanager/documents/Publications/Climate/SEI-DB-2013-New-fossil-fuel-economy-2.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }