Buying into low carbon
Dr Luca Panzone and Brett Cherry discuss how to lower consumers’ food shopping carbon footprint by encouraging environmentally friendly buying
Global policy agendas increasingly support the reduction of greenhouse gas (GHG) emissions to ensure that climate change is kept under control. The private sector recognises this, with many businesses reporting their environmental performance annually in their CSR or sustainability reports. However, achieving net zero emissions will require the support of food shoppers, too: in western economies, food accounts for around 30% of total household GHG emissions, a sizeable share. Could carbon footprint labelling make a difference to consumers’ food choices?
Carbon labelling food products
There is currently no information on the environmental impact of food choices in the market. Indeed, consumers are confronted with a complex food labelling system, and adding complexity can hinder, rather than help, changes in behaviour. Carbon labelling reports the amount of GHGs a product has emitted by merging complex supply chain information into a single number.
This is still a relatively new concept for consumers, and is not yet present on packaging. It is an obvious option when it comes to informing consumers: it has been discussed and studied for years, and many products have been ‘footprinted’. Some external sources, such as smartphone apps (eg Giki) already provide this information. These might not be enough, though, as they only help consumers who already have strong environmental values – not the larger group of climate-inactive consumers.
Driving low-carbon behaviour
Helping the environment presents a dilemma for consumers: the decision often requires giving up something personal (the product they like the most) for little individual benefit. For instance, imagine a meat lover agreeing to give up meat; they will receive some noticeable benefit if everyone gives up a little meat, but minimal return if they act alone. This problem reduces the motivation to act, leaving a need for more structured interventions.
There are three main drivers of behaviour. Firstly, consumers change behaviour if there is a change in the costs and benefits of a decision. For instance, a carbon tax changes behaviour by increasing the costs of high-carbon goods relative to low-carbon goods.
Secondly, changes in the way products are sold alter how consumers shop. Choice architecture changes behaviour by making socially ‘desirable’ choices simpler. For example, making low-carbon options more accessible or visible on a shelf has the potential to drastically reduce the carbon footprint of a diet.
Thirdly, behaviour change requires a change in consumer mindset. Providing information on the environmental impacts of food choices helps to raise awareness.
This third point is particularly relevant because environmentally conscious consumers may fail to act because they are unaware of the carbon footprint of their food shopping decisions, or may not think food is part of the problem. Indeed, these three drivers are connected: as an example, policy interventions that target price tell consumers that products with a higher tax should be consumed with moderation to avoid environmental problems.
These interventions require consumers to know the carbon footprint of products so that they can switch to low-carbon alternatives. It is important to understand not only if a policy works, but also whether the effect is sustained over time. Retailers want to build a relationship with consumers, and so does the government, which designs policies to create long-term compliance. A multi-week experiment can provide suggestions on how to design a policy that values environmental protection over time.
“Helping the environment presents a dilemma for consumers: the decision often requires giving up something personal (the product they like the most) for little individual benefit”
All products emit GHGs, and a carbon tax should tax all products in proportion to the amount of GHGs they emit. In recent research using an online shopping environment, a carbon tax for all products in-store (an average price increase of 8.5%) successfully encouraged shoppers to lower their carbon footprint by around 20%. The effect remains stable for two consecutive weeks of taxation.
The tax was designed to ensure that consumers do not spend less and are motivated to switch to low-carbon options. A carbon tax, therefore, does not have to be bad for business: it can lower the carbon footprint of food shopping by making consumers buy more wisely. At the same time, it can motivate suppliers to find ingenious ways to reduce the carbon footprint of their products and reduce the price increase.
As a result, a carbon tax on food products can assist countries in meeting decarbonisation targets and motivate shoppers to lower their carbon footprint. The tax is more effective if there is a carbon label that helps interested consumers who are searching for low-carbon options – which, in the presence of a tax, implies helping consumers to spend less money on tax and more money on food.
Past decisions matter
The mindset of the consumer also plays a role when it comes to choosing low-carbon products. Whether the person feels they are doing enough for the environment or not can influence the carbon footprint of someone’s food shopping basket. To this extent, encouraging consumers to think about their past successful environmental behaviours can drive further carbon footprint reductions. This can induce consumers to feel that they care for the environment (why would they have done it – and succeeded – otherwise?), encouraging further pro-environmental behaviour. We asked consumers to report their pro-environmental behaviours from the past week before shopping, and then informed them about the carbon they saved.
This reflection resulted in consumers buying food baskets that were around 20% lower in carbon footprint. The resulting basket had a knock-on effect of reducing fat consumption, because a number of high-carbon products (such as meat and dairy) have more fat than low-carbon options (fruit and vegetables). Having access to carbon labels allowed consumers to find low-carbon alternatives for their basket. However, the effect of this nudge does not persist over time unless it is used jointly with other nudges or policies.
Consumers play a key role in targeting reductions in GHG emissions. Their choices drive changes in the way food is produced, leading to long-lasting carbon reductions. Markets need to motivate customers to consider the environmental implications of their choices, increasing their interest for environmental protection. Carbon labelling is perhaps the first of many steps, but it can provide information on a product’s GHG emissions and allows consumers to rank products by ‘environmental quality’.
The role of carbon labelling is even more important in the presence of interventions that target carbon reductions, because it enables consumers to actively look for low-carbon options. Moreover, a carbon label draws the consumer’s attention to GHG emissions and the natural environment, raising awareness of the need for sustainable choices. Perhaps it is time to introduce carbon labelling across the whole marketplace. Like nutritional labelling, it would be a bold move, but it could drive long-term changes to protect the environment for future generations.
“A carbon label draws the consumer’s attention to GHG emissions and the natural environment, raising awareness of the need for sustainable choices”
Testing interventions for sustainable food shopping
We designed an online experimental supermarket, which allows testing for new policies (such as a carbon tax), to design persuasive messages that encourage shoppers to
make low-carbon food choices, as well as to observe the impact of marketing activities on consumer choice overall. Supermarkets can use this platform to test their own activities and interventions in a controlled environment prior to a live roll-out.
The aim is to help shoppers make better choices, removing potential mistakes, misconceptions and distractions and persuading them to make sustainable decisions. The online shopping platform does this by helping us to understand how people make food choices based on information provided, and their personal goals and interests.
Crucially, consumers do receive what they purchase, and while they have the option to make smarter choices, the uninterested consumer is never forced to make choices they would prefer not to.
Phases of carbon emissions
The carbon footprint of a food product is the amount of GHGs emitted during the production and consumption of it. A carbon footprint is expressed in tonnes of carbon dioxide equivalents (CO2e). This metric measures the impact of the consumption of a product on global warming by summing all emissions of gases from the production of raw materials, industrial processing, transport, storage, cooking, consumption and waste.
For instance, eating an egg emits CO2e to: make and deliver feed for the hens; heat the shed to maintain the health of the hens; transport the eggs by van; store eggs in chilled rooms; produce the packaging in which eggs are sold; and use energy for cooking it.
This simple example tells us that the way carbon footprint is calculated depends critically on the supply chain of the food product under consideration. In general, the carbon footprint of food consists of six elements:
- GHG of inputs – for example fertilisers for agricultural production, or packaging for industry
- GHG from the production of the raw materials
- GHG from transport and logistics, for raw materials to reach their destination
- GHG from manufacturing or processing, that is the production of the product itself
- GHG from distribution, related to the operations of the retailer selling the product, including store energy consumption, food storage or in-store refrigeration
- GHG from consumption and waste, eg cooking, home refrigeration, and composting.
Dr Luca Panzone is a lecturer in consumer behaviour at Newcastle University.
Brett Cherry is science communications and marketing manager at Newcastle University.