A decomposing analysis of productive and residential energy consumption in Beijing

Abstract

With Beijing’s energy demand shifting to the household side in the past decade, uncovering the driving factors of Beijing’s energy consumption plays an essential role for policy design. To this end, the structural changes in Beijing’s residential and productive energy consumption are decomposed using the logarithmic mean Divisia index (LMDI) method in this paper. Empirical analysis is conducted focusing on Beijing’s energy changes during 2009–2018. Results suggest that: (1) The contribution of residential energy consumption has exceeded that of the productive sector, meanwhile the expected decrease in both sectors’ energy consumption are not observed considering the energy efficiency improvements; (2) The optimization of Beijing’s energy consumption cannot solely rely on the technical development, the influence due to the upgrade of industrial structure in Beijing also matters, especially after 2011; (3) In the residential sector, all factors display stronger impacts on energy consumption changes in urban areas than in rural areas, among which the living standard is the most significant. Based on these results, suggestions are provided to promote the decrease of Beijing’s energy consumption.