Structural decomposition analysis of sources of decarbonizing economic development in China; 1992–2006

Abstract

To analyze and understand decarbonizing economic development in China, this paper undertakes a structural decomposition analysis of the historical change in energy-related carbon intensity in China between 1992 and 2006. The results show that the energy-related carbon intensity in China decreased by about three-fourths between 1992 and 2006 and reduced carbon emissions by about two billion tons. The decline in the energy-related carbon intensity was mainly caused by changes in production pattern, especially changes in energy intensity within each sector between 1992 and 2002. However, the most important driving force of carbon intensity from 2002–2006 was not the energy intensity within each sector but the input mix. On the other hand, changes in demand pattern pushed up the carbon intensity. To further decarbonize the economy in the future, it is important for China to further enforce policies on shaping the production pattern, such as reducing energy intensity, and pay more attention to increasing the sustainability of the demand pattern at the same time.