Factor decomposition of China’s industrial electricity consumption using structural decomposition analysis

Abstract

We analyzed changes in China’s industrial electricity consumption using a structural decomposition model based on input-output analysis. China’s industrial electricity consumption changes during 2007–2012 were decomposed into four factors: electricity intensity, technology-input structural, final demand structure and total final demand. The results showed that changes in total final demand contributed most to increases in China’s industrial electricity consumption, which increased electricity consumption by 2091.34 billion kW h. As for aggregate demand, increased investment, urban residential consumption, and exports all played major roles. However, increases in total rural residents’ consumption and total inventory had little effect on the electricity consumption of various industrial sectors. The key reason for reductions in industrial electricity consumption was the decrease in electricity intensity in the heavy manufacturing industry, the service industry, and the energy industry. The decline in electricity consumption intensity in China reduced electricity consumption by 446.21 billion kW h.