Dynamics in Aotearoa New Zealand’s energy consumption between 2006/2007 and 2012/2013

Abstract

Contemporaneous structural changes in the New Zealand economy, growth of the services sector, and increased reliance on renewable sources of electricity, underpin changing patterns of energy consumption in Aotearoa New Zealand. The Zero Carbon Act passed in November 2019 set a pathway to transition to a net-zero carbon future. Actions aimed at reducing energy consumption, especially transport related fossil-fuel consumption, should further accelerate the transition to a low-carbon economy. However, little is known of the factors driving patterns of energy consumption. This study systematically investigates New Zealand’s energy consumption from the perspectives of production and consumption, combining environmentally-extended input-output analysis and structural decomposition analysis. Results show that at the national level, population growth was the dominant factor in promoting energy consumption. In contrast, decreasing direct energy intensity had the largest impact on limiting growth in energy consumption. Private consumption and exports were the main sources of energy consumption. Results support important policy recommendations that achieve this low-carbon transition, such as the electrification of transport and the promotion of renewable energy.