Changes in the Energy Consumption in EU-27 Countries

Issue: 2012/1

Vladimír Hajko

Department of Economics, Faculty of Economics and Administration, Masaryk University, Lipová 507/41a, Brno, Czech Republic. Tel: +420732737843. E-mail address: vladimir.hajko@mail.muni.cz

The complete decomposition method is applied to changes in energy consumption in the countries of EU-27. This method decomposes the changes in energy use into three different effects: a change in energy consumption due to an increase of economic activity (the activity effect), a change in energy consumption due to a relative increase of significance of a country in the group (the structure effect) and a change in energy consumption due to a change of energy efficiency measured as energy intensity (the intensity effect). The results confirm that there is a difference in development of these effects between the old (EU-15) and the new member countries. The results show that the activity effect is the most significant effect in old member countries (EU-15), and is on average 1.13 times higher than in new member countries. The intensity effect is the main diversifying factor between the two groups and the most significant effect for the new member countries. The intensity effect is almost universally negative in all countries, and compensates for the other effects. Because of the importance of the effect, energy intensity convergence is examined. It is found that even by the ''rough'' distinction between the new and the old member countries, the convergence in energy intensity in new member countries can be found (in the old member countries there is no energy intensity convergence).

Pages: 
3–21
DOI: 10.2478/v10135-012-0001-y
JEL: Q43, O13
Keywords: Decomposition analysis; Energy use; Energy intensity; EU-27
References: 

 

ANG, B.W., NA LIU. (2007). Energy decomposition analysis: IEA model versus other methods. Energy Policy. 35: pp. 1426–1432.

ANG, B.W., ZHANG, F. Q. (2000). A survey of index decomposition analysis in energy and environmental studies. Energy. 25: pp. 1149–1176.

BARRO, R.J., SALA-I-MARTIN, X.. (1992). Convergence. Journal of Political Economy.100, pp. 407–443.

CLEVELAND, C.J., KAUFMANN, R.K., STERN, D.I. (2000). Aggregation and the role of energy in the economy. Ecological Economics. 32, pp. 301–317

EZCURRA R. (2007). Distribution dynamics of energy intensities: a cross-country analysis. Energy Policy. 35: 5254–5259

FISHER I. (1972). The making of index numbers. 3rd ed. Boston, MA: Houghton Mifflin.

PATTERSON, M. G. (1996). What is energy efficiency?: Concepts, indicators and methodological issues. Energy Policy 24: 377–390.

SALA-I-MARTIN, X. (1996). Regional cohesion: Evidence and theories of regional growth and convergence. European Economic Review. 40: pp. 1325-1352.

SUN, J.W. (1996). Quantitative analysis of energy consumption, efficiency and savings in the world, 1973-1990. Turku School of Economics Press, series A-4: 1996.

SUN, J.W. (1998). Changes in energy consumption and energy intensity: A complete decomposition model. Energy Economics. 20: pp. 85-100.