IDEAS home Printed from https://ideas.repec.org/a/eee/energy/v247y2022ics0360544222003644.html
   My bibliography  Save this article

Energy efficiency and factor productivity in Pakistan: Policy perspectives

Author

Listed:
  • Raza, Muhammad Yousaf
  • Lin, Boqiang

Abstract

Energy efficiency shows tremendous potential for enhancing economic growth while also conquering the emissions of greenhouse gases. It is generally acknowledged that Pakistan's decarbonization has to be escorted by energy efficiency developments. This study analyzes key factors behind the energy consumption variations at the sectorial level, such as agriculture, industrial and services that consume almost 70% of Pakistan's final energy. The logarithmic mean Divisia index method is applied to detect the impacting variables (i.e., energy intensity, economic activity, labor productivity, and employed labor), which oversee energy consumption for 2000–2020. Results show (1) the observed sectors provide a positive energy intensity at the maximum period, which is the main reason for negative economic activity. (2) Significant and optimistic labor productivity appeared during 2000–2020, which could be discussed due to an upsurge in capital investment and economic activity liable for increasing productivity. (3) Each factor's ratio increases in which labor productivity and economic activity present maximum input, excluding the epidemic period. (4) The sectorial energy efficiency accounting system under current energy consumption declined by 40.7 Mtoe because of COVID-19. Finally, the study provides policies linked to energy efficiency, pollution reduction, and economic sustainability based on empirical results.

Suggested Citation

  • Raza, Muhammad Yousaf & Lin, Boqiang, 2022. "Energy efficiency and factor productivity in Pakistan: Policy perspectives," Energy, Elsevier, vol. 247(C).
    • Handle: RePEc:eee:energy:v:247:y:2022:i:c:s0360544222003644
    DOI: 10.1016/j.energy.2022.123461
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0360544222003644
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.energy.2022.123461?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. Su, Bin & Ang, B.W., 2017. "Multiplicative structural decomposition analysis of aggregate embodied energy and emission intensities," Energy Economics, Elsevier, vol. 65(C), pages 137-147.
    3. Horowitz, Marvin J. & Bertoldi, Paolo, 2015. "A harmonized calculation model for transforming EU bottom-up energy efficiency indicators into empirical estimates of policy impacts," Energy Economics, Elsevier, vol. 51(C), pages 135-148.
    4. Ang, B.W., 2015. "LMDI decomposition approach: A guide for implementation," Energy Policy, Elsevier, vol. 86(C), pages 233-238.
    5. Yousuf, I. & Ghumman, A.R. & Hashmi, H.N. & Kamal, M.A., 2014. "Carbon emissions from power sector in Pakistan and opportunities to mitigate those," Renewable and Sustainable Energy Reviews, Elsevier, vol. 34(C), pages 71-77.
    6. García-Quevedo, Jose & Jové-Llopis, Elisenda, 2021. "Environmental policies and energy efficiency investments. An industry-level analysis," Energy Policy, Elsevier, vol. 156(C).
    7. Bertoldi, Paolo & Mosconi, Rocco, 2020. "Do energy efficiency policies save energy? A new approach based on energy policy indicators (in the EU Member States)," Energy Policy, Elsevier, vol. 139(C).
    8. Lin, Boqiang & Raza, Muhammad Yousaf, 2020. "Analysis of energy security indicators and CO2 emissions. A case from a developing economy," Energy, Elsevier, vol. 200(C).
    9. Bertoldi, Paolo & Labanca, Nicola & Rezessy, Silvia & Steuwer, Sibyl & Oikonomou, Vlasis, 2013. "Where to place the saving obligation: Energy end-users or suppliers?," Energy Policy, Elsevier, vol. 63(C), pages 328-337.
    10. Ang, B.W. & Mu, A.R. & Zhou, P., 2010. "Accounting frameworks for tracking energy efficiency trends," Energy Economics, Elsevier, vol. 32(5), pages 1209-1219, September.
    11. Hu, Jin-Li & Wang, Shih-Chuan, 2006. "Total-factor energy efficiency of regions in China," Energy Policy, Elsevier, vol. 34(17), pages 3206-3217, November.
    12. Liu, Lan-Cui & Fan, Ying & Wu, Gang & Wei, Yi-Ming, 2007. "Using LMDI method to analyze the change of China's industrial CO2 emissions from final fuel use: An empirical analysis," Energy Policy, Elsevier, vol. 35(11), pages 5892-5900, November.
    13. Ang, B.W. & Xu, X.Y., 2013. "Tracking industrial energy efficiency trends using index decomposition analysis," Energy Economics, Elsevier, vol. 40(C), pages 1014-1021.
    14. Ang, B. W., 2005. "The LMDI approach to decomposition analysis: a practical guide," Energy Policy, Elsevier, vol. 33(7), pages 867-871, May.
    15. Wang, Wenwen & Liu, Xiao & Zhang, Ming & Song, Xuefeng, 2014. "Using a new generalized LMDI (logarithmic mean Divisia index) method to analyze China's energy consumption," Energy, Elsevier, vol. 67(C), pages 617-622.
    16. Lin, Boqiang & Raza, Muhammad Yousaf, 2021. "Analysis of electricity consumption in Pakistan using index decomposition and decoupling approach," Energy, Elsevier, vol. 214(C).
    17. Román-Collado, Rocío & Economidou, Marina, 2021. "The role of energy efficiency in assessing the progress towards the EU energy efficiency targets of 2020: Evidence from the European productive sectors," Energy Policy, Elsevier, vol. 156(C).
    18. AkbostancI, Elif & Tunç, Gül Ipek & Türüt-AsIk, Serap, 2011. "CO2 emissions of Turkish manufacturing industry: A decomposition analysis," Applied Energy, Elsevier, vol. 88(6), pages 2273-2278, June.
    19. Patterson, Murray G, 1996. "What is energy efficiency? : Concepts, indicators and methodological issues," Energy Policy, Elsevier, vol. 24(5), pages 377-390, May.
    20. Lin, Boqiang & Raza, Muhammad Yousaf, 2020. "Coal and economic development in Pakistan: A necessity of energy source," Energy, Elsevier, vol. 207(C).
    21. Yousaf Raza, Muhammad & Lin, Boqiang, 2021. "Oil for Pakistan: What are the main factors affecting the oil import?," Energy, Elsevier, vol. 237(C).
    22. de Almeida, Anibal T. & Fong, Joao & Falkner, Hugh & Bertoldi, Paolo, 2017. "Policy options to promote energy efficient electric motors and drives in the EU," Renewable and Sustainable Energy Reviews, Elsevier, vol. 74(C), pages 1275-1286.
    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. Mushtaq, Zulqarnain & Wei, Wei & Jamil, Ihsan & Sharif, Maimoona & Chandio, Abbas Ali & Ahmad, Fayyaz, 2022. "Evaluating the factors of coal consumption inefficiency in energy intensive industries of China: An epsilon-based measure model," Resources Policy, Elsevier, vol. 78(C).
    2. Yousaf Raza, Muhammad & Lin, Boqiang, 2023. "Development trend of Pakistan's natural gas consumption: A sectorial decomposition analysis," Energy, Elsevier, vol. 278(PA).
    3. Jamshid Ali Turi & Joanna Rosak-Szyrocka & Maryam Mansoor & Hira Asif & Ahad Nazir & Daniel Balsalobre-Lorente, 2022. "Assessing Wind Energy Projects Potential in Pakistan: Challenges and Way Forward," Energies, MDPI, vol. 15(23), pages 1-21, November.
    4. Muhammad Yousaf Raza & Yingchao Chen & Songlin Tang, 2022. "Assessing the Green R&D Investment and Patent Generation in Pakistan towards CO 2 Emissions Reduction with a Novel Decomposition Framework," Sustainability, MDPI, vol. 14(11), pages 1-19, May.
    5. Navid Rezaei & Abdollah Ahmadi & Mohammadhossein Deihimi, 2022. "A Comprehensive Review of Demand-Side Management Based on Analysis of Productivity: Techniques and Applications," Energies, MDPI, vol. 15(20), pages 1-28, October.
    6. Teng, Yuqiang & Lin, Boqiang, 2024. "The energy-saving effect of industrial chain synergistic division: Evidence from China's industrial chain," Energy Policy, Elsevier, vol. 185(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. Raza, Muhammad Yousaf & Lin, Boqiang, 2023. "Future outlook and influencing factors analysis of natural gas consumption in Bangladesh: An economic and policy perspectives," Energy Policy, Elsevier, vol. 173(C).
    2. 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).
    3. Lin, Boqiang & Raza, Muhammad Yousaf, 2021. "Analysis of electricity consumption in Pakistan using index decomposition and decoupling approach," Energy, Elsevier, vol. 214(C).
    4. Román-Collado, Rocío & Colinet, María José, 2018. "Are labour productivity and residential living standards drivers of the energy consumption changes?," Energy Economics, Elsevier, vol. 74(C), pages 746-756.
    5. Trotta, Gianluca, 2020. "Assessing energy efficiency improvements and related energy security and climate benefits in Finland: An ex post multi-sectoral decomposition analysis," Energy Economics, Elsevier, vol. 86(C).
    6. Fernández González, P. & Landajo, M. & Presno, M.J., 2014. "Tracking European Union CO2 emissions through LMDI (logarithmic-mean Divisia index) decomposition. The activity revaluation approach," Energy, Elsevier, vol. 73(C), pages 741-750.
    7. Liang, Wei & Gan, Ting & Zhang, Wei, 2019. "Dynamic evolution of characteristics and decomposition of factors influencing industrial carbon dioxide emissions in China: 1991–2015," Structural Change and Economic Dynamics, Elsevier, vol. 49(C), pages 93-106.
    8. 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.
    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. Zhong, Sheng, 2021. "Assessing the drivers of changes in aggregate fuel economy in Massachusetts: The role of vehicle reallocation," Technological Forecasting and Social Change, Elsevier, vol. 166(C).
    11. Wang, Qunwei & Wang, Yizhong & Zhou, P. & Wei, Hongye, 2017. "Whole process decomposition of energy-related SO2 in Jiangsu Province, China," Applied Energy, Elsevier, vol. 194(C), pages 679-687.
    12. Yuhuan Zhao & Hao Li & Zhonghua Zhang & Yongfeng Zhang & Song Wang & Ya Liu, 2017. "Decomposition and scenario analysis of CO2 emissions in China’s power industry: based on LMDI method," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 86(2), pages 645-668, March.
    13. Mousavi, Babak & Lopez, Neil Stephen A. & Biona, Jose Bienvenido Manuel & Chiu, Anthony S.F. & Blesl, Markus, 2017. "Driving forces of Iran's CO2 emissions from energy consumption: An LMDI decomposition approach," Applied Energy, Elsevier, vol. 206(C), pages 804-814.
    14. Tian, Yihui & Zhu, Qinghua & Geng, Yong, 2013. "An analysis of energy-related greenhouse gas emissions in the Chinese iron and steel industry," Energy Policy, Elsevier, vol. 56(C), pages 352-361.
    15. Hasanbeigi, Ali & Price, Lynn & Fino-Chen, Cecilia & Lu, Hongyou & Ke, Jing, 2013. "Retrospective and prospective decomposition analysis of Chinese manufacturing energy use and policy implications," Energy Policy, Elsevier, vol. 63(C), pages 562-574.
    16. Lin, Boqiang & Ouyang, Xiaoling, 2014. "Analysis of energy-related CO2 (carbon dioxide) emissions and reduction potential in the Chinese non-metallic mineral products industry," Energy, Elsevier, vol. 68(C), pages 688-697.
    17. Zhao, Rongqin & Liu, Ying & Tian, Mengmeng & Ding, Minglei & Cao, Lianhai & Zhang, Zhanping & Chuai, Xiaowei & Xiao, Liangang & Yao, Lunguang, 2018. "Impacts of water and land resources exploitation on agricultural carbon emissions: The water-land-energy-carbon nexus," Land Use Policy, Elsevier, vol. 72(C), pages 480-492.
    18. Jiabin Chen & Shaobo Wen, 2020. "Implications of Energy Intensity Ratio for Carbon Dioxide Emissions in China," Sustainability, MDPI, vol. 12(17), pages 1-13, August.
    19. Kristiāna Dolge & Dagnija Blumberga, 2021. "Key Factors Influencing the Achievement of Climate Neutrality Targets in the Manufacturing Industry: LMDI Decomposition Analysis," Energies, MDPI, vol. 14(23), pages 1-23, November.
    20. Wang, Miao & Feng, Chao, 2021. "The consequences of industrial restructuring, regional balanced development, and market-oriented reform for China's carbon dioxide emissions: A multi-tier meta-frontier DEA-based decomposition analysi," Technological Forecasting and Social Change, Elsevier, vol. 164(C).

    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:energy:v:247:y:2022:i:c:s0360544222003644. 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.journals.elsevier.com/energy .

    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.