Energy efficiency achievements in China׳s industrial and transport sectors: How do they rate?

China is experiencing intensified industrialisation and motorisation. In the world׳s largest emerging economy, energy efficiency is expected to play a critical role in the ever-rising demand for energy. Based on factual overviews and numerical analysis, this article carries out an in-depth investigation into the effectiveness of policies announced or implemented in recent decades targeted at energy conservation in the energy intensive manufacturing and transportation sectors. It highlights nine energy intensive sectors that achieved major improvements in their energy technology efficiency efforts. Under the umbrella of the 11th Five-Year Plan, these sectors׳ performances reflect the effectiveness of China׳s energy conservation governance. Numerous actions have been taken in China to reduce the road transport sector׳s demand for energy and its GHG emissions by implementing fuel economy standards, promoting advanced energy efficient vehicles, and alternative fuels.Coal-based energy saving technologies, especially industrial furnace technologies, are critical for China׳s near and medium-term energy saving. In the long run, renewable energy development and expanding the railway transport system are the most effective ways to reduce energy use and GHG emissions in China. Fuel economy standards could reduce oil consumption and GHGs by 34–35 per cent.     

影响全国与北京工业能源消费的关键要素对比分析

全国能源强度2002年开始上升,北京能源强度却一直呈现下降态势;这不仅和北京第三产业快速发展相关,而且北京工业能源强度也保持了下降趋势。基于对数均值迪氏指数分解法,将能源消费分解成规模效应、结构效应和效率效应,对1998～2006年的北京及全国工业能源消费量进行了分解及对比分析。研究表明,效率效应对全国工业能源消费下降起到了比较显著的作用,而结构效应和效率效应共同促使北京的能源消费降低。与全国相比,北京大力促进高科技产业的发展,控制黑色金属冶炼及压延加工业、化学工业等高耗能工业的发展,是其工业能源强度迅速降低的一个重要原因。最后,分析了北京能源强度快速下降对全国的启示,并提出了全国能源消费进一步降低的政策建议。     

Understanding industrial energy use: Physical energy intensity changes in Indian manufacturing sector

This study develops and examines physical energy intensity indicators in five industrial sub-sectors—iron and steel, aluminum, textiles, paper, and cement—and investigates mitigation options for energy related CO₂ emissions (during 1991–2005). Decomposition analysis has been employed to separate the structural effect (share of different products in the sector) from pure intensity effect (efficiency increase through technical improvement) for each industry. The results show that the combined effect (considering both structural and intensity effects together) on both iron and steel and paper and pulp industries is negative while it is positive for aluminum and textiles. The intensity effect for all the industries, barring textiles, is negative showing improvement in energy efficiency; iron and steel in particular, has seen a decrease of 134 PJ in energy consumption owing to improvements in efficiency. However, energy intensity in textiles has risen by 47 PJ due to increased mechanization. Structural effect is positive in aluminum and iron and steel industries indicating a movement towards higher energy-intensive products. In the case of aluminum, positive structural effect dominates over negative intensive effect whereas negative intensive effect dominates iron and steel industry. The paper helps in designing policies for improving productivity and reduce energy consumption in India's manufacturing sector.     

The driving forces of China׳s energy use from 1992 to 2010: An empirical study of input–output and structural decomposition analysis

The energy consumption in China has accelerated since the early 2000s, and China became the largest energy consumer in the world by 2010. To examine the driving forces of China׳s energy use, this paper conducts a structural decomposition analysis based on hybrid input–output tables. In addition, we describe the framework of China׳s energy system by using two energy flow charts. The results show that China׳s current energy use is investment-led demand. Between 1992 and 2007, the three main final-demand categories – gross fixed capital formation, household consumption and exports – contributed approximately one-third each to the changes of total energy use in China. Between 2007 and 2010, however, three-quarters of energy consumption changes came from investment activity only. Technological improvement saved approximately five percent of the total energy use annually during the periods of 1992–1997, 1997–2002 and 2007–2010. In the period of 2002–2007, however, its contribution dropped to only three percent p.a. due to the rise of the indirect energy requirement coefficient in the construction sector. These results suggest that adjusting the final demand structure and improving energy efficiency further will meet China׳s energy challenges in the future.     

Analysis and decomposition of energy consumption in the Chilean industry

With rising energy costs and climate change concerns, energy efficiency will be important in maintaining competitiveness and reducing the environmental impact of industrial activities. In this paper we study the Chilean industrial sector, which is the largest consumer of energy within the country. Energy demand and CO₂ emissions in Chile have grown rapidly in recent years while energy supply is mostly imported and subject to disruption. Therefore, it is important to understand energy consumption in this sector and determine which sub-sectors have the greatest potential to reduce energy consumption. We used the Index Decomposition Analysis (IDA), applying the Logarithmic Mean Divisia Index method I (LMDI-I), to quantify the impact of diverse driving factors on energy consumption. Furthermore, a panel data analysis was used to determine whether there are differences in energy intensity across firms with different characteristics. Our results show that energy intensity has risen over time although energy consumption remains stable. This fact supports the idea that energy efficiency policies could play an important role for the industrial sector. Additionally, energy consumption and energy intensity follow different patterns in each sub-sector; therefore we conclude that the application of differentiated sectoral policies is preferable over a single global policy.     

Assessment of energy efficiency performance measures in industry and their application for policy

Energy efficiency improvement is a basic yet significant way of addressing both energy security and environment concerns. There are various measures of industrial energy efficiency performance, with different purposes and applications. This paper explores different ways to measure energy efficiency performance (MEEP): absolute energy consumption, energy intensity, diffusion of specific energy-saving technology and thermal efficiency. It discusses their advantages and disadvantages, and roles within policy frameworks. Policy makers should consider the suitability of MEEP based on criteria such as reliability, feasibility and verifiability. The limitations of both energy intensity and necessity of broader all-inclusive indicators and technology diffusion indicators are also discussed. A case study on Japan's iron and steel industry illustrates the critical role of proper boundary definitions for a meaningful assessment of energy efficiency in industry. Depending on the boundaries set for the analysis, the energy consumption per ton of crude steel ranges from 16 to 21 GJ. This paper stresses the importance of a proper understanding of various methods to assess energy efficiency, and the linkage with policy objectives and frameworks. Possible next steps for improvement of MEEP, such as database development, were also discussed.     

Analysis of the energy metabolism of urban socioeconomic sectors and the associated carbon footprints: Model development and a case study for Beijing

Cities consume 80% of the world׳s energy; therefore, analyzing urban energy metabolism and the resulting carbon footprint provides basic data for formulating target carbon emission reductions. While energy metabolism includes both direct and indirect consumptions among sectors, few researchers have studied indirect consumption due to a lack of data. In this study, we used input–output analysis to calculate the energy flows among directly linked sectors. Building on this, we used ecological network analysis to develop a model of urban energy flows and also account for energy consumption embodied by the flows among indirectly linked sectors (represented numerically as paths with a length of 2 or more). To illustrate the model, monetary input–output tables for Beijing from 2000 to 2010 were analyzed to determine the embodied energy consumption and associated carbon footprints of these sectors. This analysis reveals the environmental pressure based on the source (energy consumption) and sink (carbon footprint) values. Indirect consumption was Beijing׳s primary form, and the carbon footprint therefore resulted mainly from indirect consumption (both accounting for ca. 60% of the total, though with considerable variation among sectors). To reduce emissions, the utilization efficiency of indirect consumption must improve.     

Barriers to energy efficiency improvement and decision-making behavior in Thai industry

The industrial sector is one of the main energy consuming sectors in Thailand and accounted for 36.7% of total energy consumption in 2005. The trend of rising energy prices and tougher competition increases the demand to improve energy efficiency in Thai industry. However, the existence of various barriers often hinders the realization of even some cost-effective energy efficiency measures. In an attempt to investigate key barriers to and drivers for energy efficiency improvement in Thai industry, this study found that the most important barrier expressed by both the textile and cement industries studied as well as experts interviewed is that the management is concerned about production and other matters rather than energy efficiency. Reducing product cost by reducing energy cost is found to be the main driver for energy efficiency investment. Using a conceptual industrial energy efficiency policy framework this study shows how various energy efficiency policies can affect the process of decision-making for and investment in energy efficiency in industry.     

Current situation of energy consumption and measures taken for energy saving in the iron and steel industry in China

A survey of the key issues associated with the development in the Chinese iron and steel industry and current situations of energy consumption are described in this paper. The apparent production of crude steel in China expanded to 418.78 million tonnes in 2006, which was about 34% share of the world steel production. The iron and steel industry in China is still one of the major high energy consumption and high pollution industries, which accounts for the consumption of about 15.2% of the national total energy, and generation of 14% of the national total wastewater and waste gas and 6% of the total solid waste materials. The average energy consumption per unit of steel is about 20% higher than that of other advanced countries due to its low energy utilization efficiency. However, the energy efficiency of the iron and steel industry in China has made significant improvement in the past few years and significant energy savings will be achieved in the future by optimizing end-use energy utilization. Finally, some measures for the industry in terms of the economic policy of China's 11th five-year plan are also presented.     

Energy and environment policy integration: The case of energy conservation policies and technologies in Japan

Among the OECD countries, Japan has achieved one of the lowest energy intensities and has been successful in reducing emissions of key air pollutants and CO₂ associated with energy use while maintaining a relatively high rate of economic growth, indicating that in Japan energy and environment policies have been able to address each other effectively. This study shows that in both policy domains, considerable importance was attached to the enhancement of energy conservation. The industrial sector has been the most responsive in reducing energy intensity as well as in controlling pollution. Aided by government fiscal measures, the iron and steel, chemicals and automobile industries have pursued both energy conservation and pollution control through suitable process or product innovation. The recent response to global environment issues shows that both the government and the industrial sector are determined to enhance energy conservation and environmental amelioration through technological innovation, indicating that Japanese technologies will continue to be ‘environmentally competitive’.     

我国新能源产业国际分工中的地位及提升对策

近年来,我国新能源产业发展速度位居世界前列,国际市场份额不断扩大,但依然是利用成本比较优势,以加工贸易为主,集中进入产业链中游的加工制造环节.在全球新能源产业分工中,发达国家始终享受着行业核心技术和终端产品应用所带来的创新收益和环境收益.而我国在新能源产业国际分工体系中的接入点仍然落在了能耗高、环境影响大、劳动力相对密集的制造环节,未能从根本上改变参与国际分工的方式,现阶段我国新能源产业的国际竞争力仍主要表现在价格和规模优势上.这除了产业发展路径依赖的原因外,也与政府和企业发展战略性新兴产业“急功近利”的思路不无关系.阻碍我国新能源产业国际分工地位改善和提升的主因在于产业创新机制不健全、国内市场容量小等产业发展的深层问题.同时,产业过度依赖外需,贸易摩擦和国际市场需求下降也导致我国企业经营困难.为提升我国新能源产业的国际分工地位,建议我国要调整新能源对外贸易与投资政策的思路,强化对新能源技术研发环节的政策支持,提高新能源企业的自主创新能力；充分利用全球资源,加大先进技术和创新人才引进力度；加快转变对外贸易发展方式,摈弃粗放型的增长方式,积极开拓新兴市场；促进资本的双向流动；培育新能源国际化龙头企业；完善新能源贸易与投资的服务保障体系;积极参与多边贸易谈判,改善贸易环境.     

Why did China’s energy intensity increase during 1998–2006: Decomposition and policy analysis

Despite the fact that China’s energy intensity has continuously decreased during the 1980s and mostly 1990s, the decreasing trend has reversed since 1998 and the past few years have witnessed rapid increase in China’s energy intensity. We firstly conduct an index decomposition analysis to identify the key forces behind the increase. It is found that: (1) the high energy demand in industrial sectors is mainly attributed to expansion of production scale, especially in energy-intensive industries; (2) energy saving mainly comes from efficiency improvement, with energy-intensive sectors making the largest contribution; and (3) a heavier industrial structure also contributes to the increase. This study also makes the first attempt to bridge the quantitative decomposition analysis with qualitative policy analyses and fill the gap between decomposition results and policy relevance in previous work. We argue that: (1) energy efficiency improvement in energy-intensive sectors is mainly due to the industrial policies that have been implemented in the past few years; (2) low energy prices have directly contributed to high industrial energy consumption and indirectly to the heavy industrial structure. We provide policy suggestions in the end.     

北京市经济结构与能源消费关系研究

本文采用矩阵分析法以北京市为例研究了经济结构和能源消费结构的关系,采用因素分解法研究了经济结构与能源消费强度的关系。研究认为北京市产业结构调整与各产业能源利用效率的提高都促使其能源强度下降,但主要的动力还是来自产业结构的调整;并且认为天然气是北京市1998年以来需求增长最快的能源。     

Retrospective and prospective decomposition analysis of Chinese manufacturing energy use and policy implications

AimsThe industrial sector dominates the China's total energy consumption, accounting for about 70% of energy use in 2010. Hence, this study aims to investigate the development path of China's industrial sector which will greatly affect future energy demand and dynamics of not only China, but the entire world.ScopeThis study analyzes energy use and the economic structure of the Chinese manufacturing sector. The retrospective (1995–2010) and prospective (2010–2020) decomposition analyses are conducted for manufacturing sectors in order to show how different factors (production growth, structural change, and energy intensity change) influenced industrial energy use trends in China over the last 15 years and how they will do so up to 2020.ConclusionsThe forward looking (prospective) decomposition analyses are conducted for three different scenarios. The scenario analysis indicates that if China wants to realize structural change in the manufacturing sector by shifting from energy-intensive and polluting industries to less energy-intensive industries, the value added average annual growth rates (AAGRs) to 2015 and 2020 should be more in line with those shown in scenario 3. The assumed value added AAGRs for scenario 3 are relatively realistic and are informed by possible growth that is foreseen for each subsector.     

Energy efficiency in India: Assessing the policy regimes and their impacts

In the recent years, India has emerged as one of the fast growing economies of the world necessitating equally rapid increase in modern energy consumption. With an imminent global climate change threat, India will have difficulties in continuing with this rising energy use levels towards achieving high economic growth. It will have to follow an energy-efficient pathway in attaining this goal. In this context, an attempt is made to present India's achievements on the energy efficiency front by tracing the evolution of policies and their impacts. The results indicate that India has made substantial progress in improving energy efficiency which is evident from the reductions achieved in energy intensities of GDP to the tune of 88% during 1980–2007. Similar reductions have been observed both with respect to overall Indian economy and the major sectors of the economy. In terms of energy intensity of GDP, India occupies a relatively high position of nine among the top 30 energy consuming countries of the world.     

Energy consumption trends in Hawaii

This study begins with a review of energy consumption by end-use sector in Hawaii. Then, the energy generated from renewable energy sources is analyzed between 1991 and 2006. The results show that while geothermal is a considerable source of renewable energy on the Island of Hawaii (also known as Big Island), fossil fuel is the main energy source in the State of Hawaii. The energy intensity index for the State of Hawaii is then calculated by dividing energy consumption per capita by the income per capita. The calculated energy intensity index reveals that energy consumption is directly controlled by per capita income. The results also indicate that the energy intensity index increases over time despite positive developments in energy efficient technologies. In the second part of the paper, the effect of the tourism industry on energy usage in the State of Hawaii is analyzed. The results show that tourism volume, measured in terms of tourist arrival numbers, does not change the energy consumption directly. However, a change in tourism volume does affect per capita income within a few months to a year. In the last part of the study, the energy efficiency index of Hawaii is compared with consumption averages for the US, California and the most energy efficient country in Europe, Denmark. The comparison shows that Hawaii lags behind California and Denmark in terms of energy efficiency. The comparison also shows that an increase in energy efficiency corresponds to an increase in per capita income across the board, which is in agreement with a recent report published by the American Physical Society.     

Modelling industrial energy demand in Saudi Arabia

Between 1986 and 2016, industrial energy consumption in Saudi Arabia increased by tenfold, making it one of the largest end-use sectors in the Kingdom. Despite its importance, there appear to be no published econometric studies on aggregate industrial energy demand in Saudi Arabia. We model aggregate industrial energy demand in Saudi Arabia using Harvey’s (1989) Structural Time Series Model, showing that it is both price and income inelastic, with estimated long-run elasticities of −0.34 and 0.60, respectively. The estimated underlying energy demand trend suggests improvements in energy efficiency starting from 2010.Applying decomposition analysis to the estimated econometric equation highlights the prominent roles of the activity effect (the growth in industrial value added) and the structure effect (the shift towards energy-intensive production) in driving industrial energy demand growth. Moreover, the decomposition shows how exogenous factors such as energy efficiency helped mitigate some of that growth, delivering cumulative savings of 6.8 million tonnes of oil equivalent (Mtoe) between 2010 and 2016.Saudi Arabia implemented a broad energy price reform program in 2016, which raised electricity, fuel, and water prices for households and industry. The decomposition results reveal that, holding all else constant, higher industrial energy prices in 2016 reduced the sector’s energy consumption by 6.9 %, a decrease of around 3.0 Mtoe. Saudi policymakers could therefore build on the current policy of energy price reform and energy efficiency standards to mitigate the rate of growth of industrial energy consumption, increase economic efficiency, and maintain industrial sector competitiveness.     

Energy efficiency trends and policy in Slovenia

The energy dependency of Slovenia is high (52.1%), but it is a little lower than the average energy dependency in the EU 27 (53.8%). Slovenia imports all its petroleum products and natural gas and partly coal and electricity. The energy intensity of Slovenia is higher by about 50% than the average in the EU 27. The target of the EU Directive on energy end-use efficiency and energy services adopted in 2006 is to achieve a 9% improvement of EE (energy efficiency) within the period 2008-2016. The new target of the EU climate and energy package “20-20-20 plan” is a 20% increase in EE by 2020. Since 1991 the Slovenian government has been supporting energy efficiency activities. The improvement of EE was one of the targets of strategic energy documents ReSROE (Resolution on the Strategy of Use and Supply of Energy in Slovenia from 1996 and ReNEP (Resolution on the National Energy Programme) from 2004 adopted by the Slovenian National Assembly (Parliament) in previous years. The Energy Act adopted in 1999 defines the objective of energy policy as giving priority to EE and utilization of renewable energy sources. The goals of the “National Energy Action Plan 2008-2016 (NEEAP)” adopted by the Slovenian government in 2008 include a set of energy efficiency improvement instruments in the residential, industrial, transport and tertiary sectors. The target of the NEEAP is to save final energy in the 2008-2016 period, amounting to at least 4261 GWh or 9% of baseline consumption. The indicators of energy efficiency trends show considerable improvement in the period from 1998 to 2007. The improvement of EE was reached in all sectors: manufacturing, transport and households. The paper analyses the structure, trends of energy consumption and energy efficiency indicators by sectors of economic activity. A review of energy efficiency policy and measures is described in the paper.     

Energy efficiency developments in the Dutch energy-intensive manufacturing industry, 1980–2003

We studied energy efficiency trends in the Dutch manufacturing industry between 1995 and 2003 using indicators based on publicly available physical production and specific energy consumption data. We estimated annual primary energy efficiency improvements in this period at 1.3% on average, with the individual sub-sectors ranging between −0.1% and 1.5%. Energy efficiency developments with respect to electricity, fuels/heat and non-energy use have been monitored separately and are shown to differ significantly (for the sum of the sectors studied: 1.9% for electricity, 2.6% for fuels/heat and −0.1% for non-energy use). We combined our results with those from a previous, similar study for 1980–1995 and show that over the full time period, efficiency improvements of 1% per year have been achieved on average. Based on comparison with other sources and a detailed uncertainty analysis, we conclude that we developed a reliable top-down monitoring framework for studying energy efficiency trends of the manufacturing industry that can also be applied in other countries where similar data are available. We also showed that substantial differences exist between energy consumption data available from energy statistics and according to the Long Term Agreement monitoring reports, stressing the need for ongoing independent checks of available energy consumption data to avoid problems in future evaluations of energy efficiency policies.     

Model projections and policy reviews for energy saving in China's service sector

Energy efficiency of buildings in the service sector is becoming increasingly important in China due to the structural shift of the economy from industry to services. This paper employs a bottom-up cohort model to simulate current energy saving policies and to make projections for future energy use and CO₂ emissions for the period 2000–2030 in the Chinese service sector. The analysis shows that energy demand in the service sector will approximately triple in 2030, far beyond the target of quadrupling GDP while only doubling energy use. However, it is feasible to achieve the target of emission reduction by 40% in 2020 even under the poor state of compliance rate of building standard. This paper also highlights four crucial aspects of designing optimal energy saving policies for China's service sector based on the model results.