Sources of Change in Energy Consumption in Iran: A Structural Decomposition Analysis

Document Type: Research Paper

Authors

1 Associate Professor, University of Mazandaran, Department of Economics, Babolsar, Iran

2 Assistant Professor in Economics, University of Sistan and Baluchestan, Iran

Abstract

E
nergy consumption has increased significantly in Iran during the recent decades. In this study, an inter-industrial model has been improved to investigate the sources of the changes in the energy consumption of the country. The input-output tables of Iran for the years 1988 and 2001 have been employed as the database of the model. The innovation of this research allows the researchers to study the sources of changes in energy consumption more specifically. It concerns decomposing the effect of changes in economic structure into input substitution, and backward linkage effects. The results show that the level of final demand, input substitution, and backward linkage effects lead to an increase in energy consumption in the country. In contrast, the energy intensity of products, the structural composition of the final demand, and the categorical composition of the final demand have reducing effects on energy consumption. 

Keywords


  1. Alcántara, V., and Duarte, R. (2004). Comparison of energy intensities in European Union countries: Results of a structural decomposition analysis, Energy Policy, 32(2); 177-189.
  2. Allahyari-Sani, N. (2012). Investigation and analysis of energy consumption in the economy of Iran, Indonesia and Norway using structural decomposition analysis(SDA), Dissertation in Economics, University of Allameh Tabatabei.
  3. Babanejad, M. (2010). Input- output analysis of energy consumption in Agriculture sector in Iran, Dissertation in Economics, Zabol University.
  4. Cellura, M., Longo, S. and Mistretta, M., (2012). Application of the structural decomposition analysis to assess the indirect energy consumption and air emission changes related to Italian households consumption. Renew Sustain Energy Rev, 16(2): 1135-1145.
  5. Chakraborty, D. (2007). A structural decomposition analysis of energy consumption in India, the 16th International Input-Output Conference, Istanbul, Turkey.
  6. Chen, C.Y., Wu, R.H. (1994). Sources of change in industrial electricity use in the Taiwan economy 1976-86, Energy Economics, 16: 115-120.
  7. Goli, Z. and Ashrafi, Y. (2010). Energy intensity analysis using the Fisher ideal index in Iran, Journal of Economic Research and Policies, 54, 35-48.
  8. Goudarzy-Rad, R. (2010). Investigates of the causes of changes in energy consumption in industrial sector using decomposition method, Iranian journal of Energy, 34, 79-88.
  9. Hoekstra, R. and van der Bergh, J. (2003). Comparing structural and index decomposition analysis, Energy Economics, 25(1): 39–64.
  10. Kagawa, S. and Inamura, H. (2001). A structural decomposition of energy consumption based on a hybrid rectangular input-output framework: Japan’s case, Economic System Research, 13(4): 339-364.
  11. Lin, X. and Polenske, K. (1995). Input-output anatomy of China’s energy use changes in the 1980s, Economic System Research, 7(1): 67-84.
  12. Liu, H., Xi, Y., Guo, J. and Li, X. (2010). Energy embodied in the international trade of China: An energy input-output analysis. Energy Policy, 38(8): 3957-3964.
  13. Mohammadi, S., (2009). Analysis of changes in energy consumption in economic sectors, Dissertation in Economics, University of Water and Power (Shahid Abbaspoor).
  14. Mukhopadhyay, K. and Chakraborty, D. (1999). India’s energy consumption changes during 1973-1991, Economic System Research, 11(4): 423-438.
  15. Mukhopadhyay, K. and Chakraborty, D. (2008). Energy use and GHG emissions in India, The Intermediate Input-Output Meeting on Managing the Environment, Seville, Spain.
  16. Nooij, M., Kruk, R. and Soest D.P. (2003). International comparison of domestic energy consumption, Energy Economic, 25(4): 359-373.
  17. Rose, A. and Chen C.Y. (1991). Sources of change in energy use in the U.S. economy, 1972-1982, Res Energy 1991; 13: 1-21.
  18. Su, B. and Ang, B.W. (2012). Structural decomposition analysis applied to energy and emissions: Some methodological development, Energy Economics, 34(1): 177-188.
  19. The energy balance sheets. Fuel consumption optimisation organisation, Power Ministry 2001. Last accessed 24/6/2014, http://www.moe.gov.ir/.
  20. The input-output table of Iran for the year 1988. Central Bank of Islamic Republic of Iran. 1995.
  21. The input-output table of Iran for the year 2001. Statistics Center of Iran. 2006.
  22. Weber, C.L. (2009). Measuring structural change and energy use: Decomposition of the US economy from 1997 to 2002Energy Policy; 37(4): 1561–1570.
  23. Wood, W.R., Lenzen, M. and Schaeffer, R. (2009). Structural decomposition of energy use in Brazil from 1970 to 1996, Applied Energy, 86(4): 578–587.
  24. Xia, Y., Yang, C. and Chen, X. (2012). Structural decomposition analysis on China’s energy intensity change for 1987-2005. J Syst Sci Complex, 25(1): 156-166.
  25. Zhang, H. and Lahr, M. (2014). China's energy consumption change from 1987 to 2007: A multi-regional structural decomposition analysis, Energy Policy, 67, 682-693.