If managed well, drivers such as population change and economic activity can benefit sustainable development, particularly through technological and institutional innovation, and changes in human behaviour. Successive SoE reports have, however, highlighted the challenge of reconciling the longer-term perspective of environmental policies with the relatively short-term focus of economic and social policies.
SoE 2011 recognised that the effects of drivers are mediated by processes including the policies, culture and technology that we bring to bear on our use of our environment. It noted:
Economic growth will probably include increased demand for energy and other resources, as well as increased waste generation, with all the accompanying environmental implications for resource development, emissions and waste disposal. Alternatively, economic growth may be largely decoupled from increased consumption of resources and increased waste. Improvements in the efficiency of resource use have led to a weakening of the link between economic growth and energy use over recent decades.
The term ‘relative decoupling’ is used to describe the situation when the growth rate of an environmental parameter is lower than the growth rate of the economic indicator. The term ‘absolute decoupling’ is used to describe a decline in resource use, irrespective of the growth rate of the economic driver (UNEP 2011, ABS 2016b).
There is considerable academic debate about whether population change and economic growth can be decoupled from growth in material and energy use in the long term (see, for example, Ward et al. 2016).
Achievements to date
SoE 2011 considered the extent to which Australia’s growing population and economy increased demand on resources and produced more waste, and the associated implications for the environment. It found that there was some evidence of relative decoupling of economic growth from energy and water use during recent decades.
SoE 2016 finds that relative decoupling is being achieved through improvements in the efficiency of resource use, an increase in the proportion of renewable energy generated from Australia’s abundant supply of solar and wind energy, and—according to the International Renewable Energy Agency—the declining costs of producing renewable energy (IRENA 2015). A shift in the Australian economy towards less energy-intensive sectors such as the services sector (e.g. health, education, finance, tourism) and changes in human behaviour in terms of energy use have also contributed to relative decoupling.
Evidence shows that some indicators of environmental pressure are increasing at a relatively lower rate than the economic indicator of gross value added (GVA) (ABS 2016c; Figure DRV1). The Australian Environmental–Economic Accounts show that Australia’s economic production rose 73 per cent from 1996–97 to 2013–14, as measured by GVA in chain volume terms. During the same period, indicators of environmental pressure related to energy consumption increased 31 per cent and greenhouse gas emissions increased 20 per cent, which is lower than the rate of increase in GVA (relative decoupling). In contrast, indicators for waste production rose 163 per cent, considerably more than the increase in GVA during the same period (ABS 2016c).