Designing a statistical procedure for monitoring global carbon dioxide emissions

Abstract: Following the Paris Agreement of $2015$, most countries have agreed to reduce their carbon dioxide (CO$_2$) emissions according to individually set Nationally Determined Contributions. However, national CO$_2$ emissions are reported by individual countries and cannot be directly measured or verified by third parties. Inherent weaknesses in the reporting methodology may misrepresent, typically an under-reporting of, the total national emissions. This paper applies the theory of sequential testing to design a statistical monitoring procedure that can be used to detect systematic under-reportings of CO$_2$ emissions. Using simulations, we investigate how the proposed sequential testing procedure can be expected to work in practice. We find that, if emissions are reported faithfully, the test is correctly sized, while, if emissions are under-reported, detection time can be sufficiently fast to help inform the $5$ yearly global "stocktake" of the Paris Agreement. We recommend the monitoring procedure be applied going forward as part of a larger portfolio of methods designed to verify future global CO$_2$ emissions.