LMDI decomposition analysis of total electricity consumption growth in Hunan province

Bizheng Hu,Xiao Zhou,Jing Liao,Xingwen Tu,S Trukhanov,C.-W Chow

doi:10.1051/e3sconf/202126002008

Abstract

In the past decade, as an important driving force of economic growth, the China’s electricity consumption growth rate has been decoupled from GDP growth rate. The economic reasons behind this abnormal phenomenon are worthy of further study. Based on the LMDI method, this paper built a model to decompose the total electricity consumption in Hunan province from 2010 to 2017 from the industrial and residential perspective. The results showed that: integrally, scale effect was the main driving factor of electricity consumption growth, intensity effect was the main inhibiting factor, and structure effect had no obvious influence; there are significant differences between the results of industrial and residential sectors, for the industry, the productive consumption intensity effect was the most significant factor that inhibited the growth of electricity consumption, while all the effects of residential sector were shown as promotion, and the increase of electricity consumption in the residential sector played a key role in the growth rate of electricity consumption in Hunan province.

Highlights

With the rapid development of China’s economy and the continuous improvement of the degree of electrification, electricity consumption in China is growing rapidly
Ma and Shen (2007)[7] studied the changes in China’s electricity consumption between 1984 and 2004, and the result showed that the effect of economic growth and intensity change were the main driving force
The economic scale effect, which is positive and accounts for the largest proportion in all industries, is the main driver of the increase in electricity consumption in all industries, the industrial structure effect slightly promotes electricity consumption in industries other than agriculture, forestry, animal husbandry and fisheries, and the intensity effect of production and consumption is acting as a driving force in industries such as construction, wholesale and retail trade, while the effect is inhibited in agriculture, etc

Summary

Introduction

With the rapid development of China’s economy and the continuous improvement of the degree of electrification, electricity consumption in China is growing rapidly. The study of the reasons behind this phenomenon is of great significance to understand the relationship between electricity consumption and economic, to control the excessive growth of power consumption and to realize energy saving and the sustainable and healthy development of economy. From the end of the 20th century, the trend of China’s electricity consumption growth and economic growth began to deviate, many researchers adopted various methods to study this abnormal phenomenon. Ma and Shen (2007)[7] studied the changes in China’s electricity consumption between 1984 and 2004, and the result showed that the effect of economic growth and intensity change were the main driving force. The above studies have analyzed the electricity consumption from multiple aspects, but most of them were limited to the national level, and lack of provincial-level research. It’s of great practical significance to understand the characteristics of electricity consumption in Hunan province and to formulate policies to save energy and reduce consumption, which has a certain reference value for other provinces

LMDI decomposition model

Decomposition results and analysis

Findings

Conclusion and suggestion