LONDON (Reuters) - Mined diamonds are less carbon-intensive than man-made, but their producers should use more green energy, according to a study commissioned by the natural diamond industry, highlighting tensions between the mined and lab-grown sectors.
The U.S. Federal Trade Commission, which investigates allegations of deceptive advertising, sent warning letters to eight lab-grown diamond companies at the beginning of April.
One of its concerns was the use of eco-friendly, or similar terms, to describe diamonds made in a laboratory, a process that requires very high temperatures.
Mined diamonds also have a high environmental impact, displacing thousands of tonnes of rock, although the analysis carried out by Trucost, part of S&P Global, for the Diamond Producers Association (DPA) found the carbon intensity of natural diamonds was lower.
The study also drew comparisons with other life-style goods based on assessments of carbon intensity published by the manufacturers, with the exception of the synthetic diamond industry because of limited public data. Trucost said its estimated calculations based on energy use per carat were designed to be conservative.
The International Grown Diamond Association did not immediately respond to requests for comment.
The DPA represents seven of the world’s largest diamond miners, including Alrosa, Anglo American unit De Beers and Rio Tinto, which account for around 75 percent of world diamond production.
De Beers also produces lab-grown diamonds, through its unit Element Six, which for decades were only sold for industrial purposes.
But last year, De Beers launched a synthetic jewellery brand Lightbox, in a reversal of its long-held strategy of selling only mined diamonds for jewellery.
The impact of what De Beers’ says are realistically priced lab-grown stones, far cheaper than rival brands, has been to reduce significantly the price of man-made diamonds.
The traditional diamond industry says it contributes to the societies where it mines, providing jobs and infrastructure and investing in conservation, as well as certification schemes to counter concerns diamonds can fuel conflicts.
The lab-grown sector promotes itself as clean and conflict-free.
The Trucost report concludes DPA members created net benefits of $16 billion (£12 billion), with socio-economic and environmental benefits, often in economies lacking alternative revenue sources.
However, it also came up with a set of recommendations for the diamond miners, saying they should reduce the environmental impact of mining by, for instance, using more renewable energy.
Jean-Marc Lieberherr, CEO of the DPA, said member companies were committed to the U.N. Sustainable Development Goals, including cutting carbon emissions.
Reporting by Barbara Lewis. Editing by Jane Merriman