Analyzing the driving forces behind CO2 emissions and reduction strategies for energy-intensive sectors in Taiwan, 1996–2006

Abstract

Between 1996 and 2006, CO2 emissions in Taiwan increased by approximately 60%, with the industrial sector accounting for 50% of that increase. Among all industrial sectors, iron and steel, petrochemicals, electronics, textiles, pulp and paper and cement accounted for approximately three-quarters of the total industrial CO2 emissions. Identifying the driving forces behind increased CO2 emissions in these six sectors could be valuable for the development of effective environmental policy. This study used two-tier KLEM input–output structural decomposition analysis (I-O SDA) to analyze the factors that lead to changes in CO2 emissions. Empirical results obtained in Taiwan reveal that increased exports level and elevated domestic autonomous final demand level were the main reasons for increases in CO2 emissions. Technological changes in materials and labor tended to decrease CO2 emissions, while the power generation mix contributed significantly to the increase. Relevant strategies for reducing CO2 emissions from energy-intensive sectors are also highlighted.