IDEAS home Printed from https://ideas.repec.org/a/eee/enepol/v172y2023ics0301421522005341.html
   My bibliography  Save this article

Factors driving aggregate service sector energy intensities in Asia and Eastern Europe: A LMDI analysis

Author

Listed:
  • Wang, Jianda
  • Dong, Kangyin
  • Hochman, Gal
  • Timilsina, Govinda R.

Abstract

The economywide energy intensities in the service sectors are declining in many countries worldwide. We identify the drivers of the declining trends by employing the Logarithmic Mean Divisia Index (LMDI) on annual data from 16 countries in the Asia and Eastern Europe for the 2000–2014 period. We find that the change in fuel mix has little contribution to driving the economywide energy intensity of the service sector down during the study horizon. Instead, the change in energy intensity contributes to a decrease in economywide energy intensity of service sectors in most countries except the Czech Republic, Estonia, Latvia, and Turkey. Moreover, since energy intensity is inseparable from economic development, changes in economic structure are an essential determinant of the economywide energy intensity of service sectors. This work also analyzes the sectoral attribution and energy feedstocks attribution of economywide energy intensity of the service sectors.

Suggested Citation

  • Wang, Jianda & Dong, Kangyin & Hochman, Gal & Timilsina, Govinda R., 2023. "Factors driving aggregate service sector energy intensities in Asia and Eastern Europe: A LMDI analysis," Energy Policy, Elsevier, vol. 172(C).
    • Handle: RePEc:eee:enepol:v:172:y:2023:i:c:s0301421522005341
    DOI: 10.1016/j.enpol.2022.113315
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0301421522005341
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.enpol.2022.113315?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Ang, B. W., 2004. "Decomposition analysis for policymaking in energy:: which is the preferred method?," Energy Policy, Elsevier, vol. 32(9), pages 1131-1139, June.
    2. Wang, Jianda & Dong, Kangyin & Dong, Xiucheng & Taghizadeh-Hesary, Farhad, 2022. "Assessing the digital economy and its carbon-mitigation effects: The case of China," Energy Economics, Elsevier, vol. 113(C).
    3. Lescaroux, François, 2008. "Decomposition of US manufacturing energy intensity and elasticities of components with respect to energy prices," Energy Economics, Elsevier, vol. 30(3), pages 1068-1080, May.
    4. Kong, Xiangfei & Lu, Shilei & Wu, Yong, 2012. "A review of building energy efficiency in China during “Eleventh Five-Year Plan” period," Energy Policy, Elsevier, vol. 41(C), pages 624-635.
    5. Ang, B.W., 2015. "LMDI decomposition approach: A guide for implementation," Energy Policy, Elsevier, vol. 86(C), pages 233-238.
    6. Choi, Ki-Hong & Ang, B. W., 2003. "Decomposition of aggregate energy intensity changes in two measures: ratio and difference," Energy Economics, Elsevier, vol. 25(6), pages 615-624, November.
    7. Zeng, Lin & Xu, Ming & Liang, Sai & Zeng, Siyu & Zhang, Tianzhu, 2014. "Revisiting drivers of energy intensity in China during 1997–2007: A structural decomposition analysis," Energy Policy, Elsevier, vol. 67(C), pages 640-647.
    8. Sun, J. W., 2002. "The decrease in the difference of energy intensities between OECD countries from 1971 to 1998," Energy Policy, Elsevier, vol. 30(8), pages 631-635, June.
    9. Usman Akbar & József Popp & Hameed Khan & Muhammad Asif Khan & Judit Oláh, 2020. "Energy Efficiency in Transportation along with the Belt and Road Countries," Energies, MDPI, vol. 13(10), pages 1-20, May.
    10. Dong,Kangyin & Hochman,Gal & Timilsina,Govinda R., 2018. "Are driving forces of CO2 emissions different across countries? : insights from identity and econometric analyses," Policy Research Working Paper Series 8477, The World Bank.
    11. Andrew P. Schurer & Michael E. Mann & Ed Hawkins & Simon F. B. Tett & Gabriele C. Hegerl, 2017. "Importance of the pre-industrial baseline for likelihood of exceeding Paris goals," Nature Climate Change, Nature, vol. 7(8), pages 563-567, August.
    12. Wu, Jianghong & Xu, Zhe & Jiang, Feng, 2019. "Analysis and development trends of Chinese energy efficiency standards for room air conditioners," Energy Policy, Elsevier, vol. 125(C), pages 368-383.
    13. Smyth, Russell & Narayan, Paresh Kumar & Shi, Hongliang, 2011. "Substitution between energy and classical factor inputs in the Chinese steel sector," Applied Energy, Elsevier, vol. 88(1), pages 361-367, January.
    14. Dong, Kangyin & Sun, Renjin & Hochman, Gal, 2017. "Do natural gas and renewable energy consumption lead to less CO2 emission? Empirical evidence from a panel of BRICS countries," Energy, Elsevier, vol. 141(C), pages 1466-1478.
    15. Chai, Jian & Guo, Ju-E & Wang, Shou-Yang & Lai, Kin Keung, 2009. "Why does energy intensity fluctuate in China?," Energy Policy, Elsevier, vol. 37(12), pages 5717-5731, December.
    16. Xue, Xinhong & Wang, Zhongcheng, 2021. "Impact of finance pressure on energy intensity: Evidence from China’s manufacturing sectors," Energy, Elsevier, vol. 226(C).
    17. B. W. Ang & Ki-Hong Choi, 1997. "Decomposition of Aggregate Energy and Gas Emission Intensities for Industry: A Refined Divisia Index Method," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3), pages 59-73.
    18. Ma, Chunbo & Stern, David I., 2008. "China's changing energy intensity trend: A decomposition analysis," Energy Economics, Elsevier, vol. 30(3), pages 1037-1053, May.
    19. Daniel Croner & Ivan Frankovic, 2018. "A Structural Decomposition Analysis of Global and NationalEnergy Intensity Trends," The Energy Journal, , vol. 39(2), pages 103-122, March.
    20. Ang, B. W. & Liu, F. L. & Chew, E. P., 2003. "Perfect decomposition techniques in energy and environmental analysis," Energy Policy, Elsevier, vol. 31(14), pages 1561-1566, November.
    21. Mulder, Peter & de Groot, Henri L.F., 2012. "Structural change and convergence of energy intensity across OECD countries, 1970–2005," Energy Economics, Elsevier, vol. 34(6), pages 1910-1921.
    22. Hatzigeorgiou, Emmanouil & Polatidis, Heracles & Haralambopoulos, Dias, 2008. "CO2 emissions in Greece for 1990–2002: A decomposition analysis and comparison of results using the Arithmetic Mean Divisia Index and Logarithmic Mean Divisia Index techniques," Energy, Elsevier, vol. 33(3), pages 492-499.
    23. Huang, Lizhen & Krigsvoll, Guri & Johansen, Fred & Liu, Yongping & Zhang, Xiaoling, 2018. "Carbon emission of global construction sector," Renewable and Sustainable Energy Reviews, Elsevier, vol. 81(P2), pages 1906-1916.
    24. Shrestha, Ram M. & Timilsina, Govinda R., 1996. "Factors affecting CO2 intensities of power sector in Asia: A Divisia decomposition analysis," Energy Economics, Elsevier, vol. 18(4), pages 283-293, October.
    25. Choi, Ki-Hong & Ang, B.W., 2012. "Attribution of changes in Divisia real energy intensity index — An extension to index decomposition analysis," Energy Economics, Elsevier, vol. 34(1), pages 171-176.
    26. Patzek, Tadeusz W. & Croft, Gregory D., 2010. "A global coal production forecast with multi-Hubbert cycle analysis," Energy, Elsevier, vol. 35(8), pages 3109-3122.
    27. Baležentis, Alvydas & Baležentis, Tomas & Streimikiene, Dalia, 2011. "The energy intensity in Lithuania during 1995–2009: A LMDI approach," Energy Policy, Elsevier, vol. 39(11), pages 7322-7334.
    28. Manfred Lenzen, 2016. "Structural analyses of energy use and carbon emissions -- an overview," Economic Systems Research, Taylor & Francis Journals, vol. 28(2), pages 119-132, June.
    29. Chang, Ming-Chung, 2014. "Energy intensity, target level of energy intensity, and room for improvement in energy intensity: An application to the study of regions in the EU," Energy Policy, Elsevier, vol. 67(C), pages 648-655.
    30. Mulder, Peter & de Groot, Henri L.F. & Pfeiffer, Birte, 2014. "Dynamics and determinants of energy intensity in the service sector: A cross-country analysis, 1980–2005," Ecological Economics, Elsevier, vol. 100(C), pages 1-15.
    31. Budzianowski, Wojciech M., 2012. "Negative carbon intensity of renewable energy technologies involving biomass or carbon dioxide as inputs," Renewable and Sustainable Energy Reviews, Elsevier, vol. 16(9), pages 6507-6521.
    32. Shahiduzzaman, Md. & Alam, Khorshed, 2013. "Changes in energy efficiency in Australia: A decomposition of aggregate energy intensity using logarithmic mean Divisia approach," Energy Policy, Elsevier, vol. 56(C), pages 341-351.
    33. Wu, Yanrui, 2012. "Energy intensity and its determinants in China's regional economies," Energy Policy, Elsevier, vol. 41(C), pages 703-711.
    34. Balachandra, P. & Ravindranath, Darshini & Ravindranath, N.H., 2010. "Energy efficiency in India: Assessing the policy regimes and their impacts," Energy Policy, Elsevier, vol. 38(11), pages 6428-6438, November.
    35. Marcel P. Timmer & Erik Dietzenbacher & Bart Los & Robert Stehrer & Gaaitzen J. Vries, 2015. "An Illustrated User Guide to the World Input–Output Database: the Case of Global Automotive Production," Review of International Economics, Wiley Blackwell, vol. 23(3), pages 575-605, August.
    36. Wurlod, Jules-Daniel & Noailly, Joëlle, 2018. "The impact of green innovation on energy intensity: An empirical analysis for 14 industrial sectors in OECD countries," Energy Economics, Elsevier, vol. 71(C), pages 47-61.
    37. Fernández González, P. & Landajo, M. & Presno, M.J., 2013. "The Divisia real energy intensity indices: Evolution and attribution of percent changes in 20 European countries from 1995 to 2010," Energy, Elsevier, vol. 58(C), pages 340-349.
    38. Yang, Xue & Xu, He & Su, Bin, 2022. "Factor decomposition for global and national aggregate energy intensity change during 2000–2014," Energy, Elsevier, vol. 254(PB).
    39. Wang, Jianda & Dong, Kangyin & Sha, Yezhou & Yan, Cheng, 2022. "Envisaging the carbon emissions efficiency of digitalization: The case of the internet economy for China," Technological Forecasting and Social Change, Elsevier, vol. 184(C).
    40. Karasalihović Sedlar, Daria & Hrnčević, Lidia & Dekanić, Igor, 2011. "Recommendations for implementation of energy strategy of the Republic of Croatia," Energy, Elsevier, vol. 36(7), pages 4191-4206.
    41. Xie, Xuan & Lin, Boqiang, 2019. "Understanding the energy intensity change in China's food industry: A comprehensive decomposition method," Energy Policy, Elsevier, vol. 129(C), pages 53-68.
    42. Ang, B.W. & Zhang, F.Q., 2000. "A survey of index decomposition analysis in energy and environmental studies," Energy, Elsevier, vol. 25(12), pages 1149-1176.
    43. Dong, Kangyin & Sun, Renjin & Hochman, Gal & Li, Hui, 2018. "Energy intensity and energy conservation potential in China: A regional comparison perspective," Energy, Elsevier, vol. 155(C), pages 782-795.
    44. Li, Yi & Sun, Linyan & Feng, Taiwen & Zhu, Chunyan, 2013. "How to reduce energy intensity in China: A regional comparison perspective," Energy Policy, Elsevier, vol. 61(C), pages 513-522.
    45. Teodora Diana Corsatea & Soeren Lindner & Inaki Arto & Maria Victoria Roman & Jose Manuel Rueda-Cantuche & Agustin Velezquez Afonso & Antonio F. Amores & Frederik Neuwahl, 2019. "World Input-Output Database Environmental Accounts," JRC Research Reports JRC116234, Joint Research Centre.
    46. Tiwari, Piyush, 2000. "An analysis of sectoral energy intensity in India," Energy Policy, Elsevier, vol. 28(11), pages 771-778, September.
    47. Liu, Nan & Ma, Zujun & Kang, Jidong, 2017. "A regional analysis of carbon intensities of electricity generation in China," Energy Economics, Elsevier, vol. 67(C), pages 268-277.
    48. Dong, Kangyin & Hochman, Gal & Timilsina, Govinda R., 2020. "Do drivers of CO2 emission growth alter overtime and by the stage of economic development?," Energy Policy, Elsevier, vol. 140(C).
    49. Bo-Shu Li & Yan Chen & Shaohui Zhang & Zheru Wu & Janusz Cofala & Hancheng Dai, 2020. "Climate And Health Benefits Of Phasing Out Iron & Steel Production Capacity In China: Findings From The Imed Model," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 11(03), pages 1-32, August.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ge, Yihan & Yuan, Rong, 2024. "Exploring decoupling relationship between ICT investments and energy consumption in China's provinces: Factors and policy implications," Energy, Elsevier, vol. 286(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Fernández González, P., 2015. "Exploring energy efficiency in several European countries. An attribution analysis of the Divisia structural change index," Applied Energy, Elsevier, vol. 137(C), pages 364-374.
    2. Fernández González, P. & Presno, M.J. & Landajo, M., 2015. "Regional and sectoral attribution to percentage changes in the European Divisia carbonization index," Renewable and Sustainable Energy Reviews, Elsevier, vol. 52(C), pages 1437-1452.
    3. Fernández González, P. & Landajo, M. & Presno, M.J., 2013. "The Divisia real energy intensity indices: Evolution and attribution of percent changes in 20 European countries from 1995 to 2010," Energy, Elsevier, vol. 58(C), pages 340-349.
    4. Zhang, Chi & Su, Bin & Zhou, Kaile & Sun, Yuan, 2020. "A multi-dimensional analysis on microeconomic factors of China's industrial energy intensity (2000–2017)," Energy Policy, Elsevier, vol. 147(C).
    5. Löschel, Andreas & Pothen, Frank & Schymura, Michael, 2015. "Peeling the onion: Analyzing aggregate, national and sectoral energy intensity in the European Union," Energy Economics, Elsevier, vol. 52(S1), pages 63-75.
    6. Fernández-Amador, Octavio & Francois, Joseph F. & Oberdabernig, Doris A. & Tomberger, Patrick, 2023. "Energy footprints and the international trade network: A new dataset. Is the European Union doing it better?," Ecological Economics, Elsevier, vol. 204(PA).
    7. Edyta Sidorczuk-Pietraszko, 2020. "Spatial Differences in Carbon Intensity in Polish Households," Energies, MDPI, vol. 13(12), pages 1-21, June.
    8. Chen, Jiandong & Cheng, Shulei & Song, Malin, 2018. "Changes in energy-related carbon dioxide emissions of the agricultural sector in China from 2005 to 2013," Renewable and Sustainable Energy Reviews, Elsevier, vol. 94(C), pages 748-761.
    9. Wang, H. & Ang, B.W. & Su, Bin, 2017. "Assessing drivers of economy-wide energy use and emissions: IDA versus SDA," Energy Policy, Elsevier, vol. 107(C), pages 585-599.
    10. Wang, Miao & Feng, Chao, 2018. "Decomposing the change in energy consumption in China's nonferrous metal industry: An empirical analysis based on the LMDI method," Renewable and Sustainable Energy Reviews, Elsevier, vol. 82(P3), pages 2652-2663.
    11. Vaninsky, Alexander, 2014. "Factorial decomposition of CO2 emissions: A generalized Divisia index approach," Energy Economics, Elsevier, vol. 45(C), pages 389-400.
    12. Voigt, Sebastian & De Cian, Enrica & Schymura, Michael & Verdolini, Elena, 2014. "Energy intensity developments in 40 major economies: Structural change or technology improvement?," Energy Economics, Elsevier, vol. 41(C), pages 47-62.
    13. Kaltenegger, Oliver, 2020. "What drives total real unit energy costs globally? A novel LMDI decomposition approach," Applied Energy, Elsevier, vol. 261(C).
    14. Wang, Qunwei & Hang, Ye & Su, Bin & Zhou, Peng, 2018. "Contributions to sector-level carbon intensity change: An integrated decomposition analysis," Energy Economics, Elsevier, vol. 70(C), pages 12-25.
    15. Seck, Gondia Sokhna & Guerassimoff, Gilles & Maïzi, Nadia, 2016. "Analysis of the importance of structural change in non-energy intensive industry for prospective modelling: The French case," Energy Policy, Elsevier, vol. 89(C), pages 114-124.
    16. Xue-Ting Jiang & Min Su & Rongrong Li, 2018. "Decomposition Analysis in Electricity Sector Output from Carbon Emissions in China," Sustainability, MDPI, vol. 10(9), pages 1-18, September.
    17. Parker, Steven & Liddle, Brantley, 2016. "Energy efficiency in the manufacturing sector of the OECD: Analysis of price elasticities," Energy Economics, Elsevier, vol. 58(C), pages 38-45.
    18. Wu, Shu & Ding, Song, 2021. "Efficiency improvement, structural change, and energy intensity reduction: Evidence from Chinese agricultural sector," Energy Economics, Elsevier, vol. 99(C).
    19. Gustavo A. Marrero & Francisco J. Ramos-Real, 2013. "Activity Sectors and Energy Intensity: Decomposition Analysis and Policy Implications for European Countries (1991–2005)," Energies, MDPI, vol. 6(5), pages 1-20, May.
    20. Wang, Juan & Hu, Mingming & Rodrigues, João F.D., 2018. "The evolution and driving forces of industrial aggregate energy intensity in China: An extended decomposition analysis," Applied Energy, Elsevier, vol. 228(C), pages 2195-2206.

    More about this item

    Keywords

    Economywide energy intensity; Service sectors; Countries in Asia and Eastern Europe; Logarithmic mean divisia index (LMDI) method; Contribution analysis;
    All these keywords.

    JEL classification:

    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:enepol:v:172:y:2023:i:c:s0301421522005341. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/enpol .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.