Material flows accounting for Scotland shows the merits of a circular economy and the folly of territorial carbon reporting

BACKGROUND: It is essential that the human race limits the environmental damage created by our consumption. A realistic pathway to limiting consumption would be to transition to a system where materials are conserved and cycled through the economy as many times as possible and as slowly as possible, greatly reducing the greenhouse gas intensive processes of resource extraction, resource processing and waste management. Material flow analysis (MFA) is a method used to understand how materials are consumed within a nation. In this study, we attempt a MFA for Scotland which links carbon emissions to material consumption using data directly based on the mass of materials used in the Scottish economy. It is the first time such an analysis has been conducted for an economy in its entirety. RESEARCH AIMS: This study aims to create a detailed material flow account (MFA) for Scotland, compare the environmental impacts and possible policy implications of different future material consumption scenarios and consider two materials, steel and neodymium, in detail. RESULTS: The model estimated that 11.4 Mg per capita of materials are consumed per year in Scotland, emitting 10.7 Mg CO(2)e per capita in the process, of which, 6.7 Mg CO(2)e per capita falls under territorial carbon accounting. Only the circular economy scenario for 2050 allowed for increases in living standards without increases in carbon emissions and material consumption. This result was mirrored in the steel and neodymium case studies—environmental impacts can be minimised by a national strategy that first reduces use, and then locally reuses materials. CONCLUSIONS: Material consumption accounts for a large proportion of the carbon emissions of Scotland. Strategic dematerialisation, particular of materials such as steel, could support future efforts to reduce environmental impact and meet climate change targets. However, policy makers should consider consumption carbon accounting boundaries, as well as territorial boundaries, if carbon savings are to be maximised. This is because imports and recyclate sent abroad can have significant effect on the carbon emissions from material consumption. We demonstrate that the more circular an economy is, the smaller the difference between global and territorial carbon emissions, and therefore that climate change targets based solely on territorial carbon emissions create perverse incentives. The study also found that there could be areas of economic development which are compatible with environmental aims, based around encouraging reprocessing activities in developed nations. ELECTRONIC SUPPLEMENTARY MATERIAL: The online version of this article (doi:10.1186/s13021-016-0063-8) contains supplementary material, which is available to authorized users.