Identifying critical supply chain paths that drive changes in CO2 emissions

To address the problem of global warming, it is important to identify the supply chain paths that drive changes in life cycle CO2 emissions and provide both policy makers and decision makers with the information on the critical paths in order to efficiently reduce the CO2 emissions. In this article, I extract and analyze the factors and key supply chains involved in changes in CO2 emissions associated with Japan's overall demand from 1990 to 2000 using the Structural Path Decomposition (SPD) method applied to the 1990-1995-2000 linked Japanese environmental input-output tables at the four-digit commodity classification level. The results reveal that the volume of CO2 emissions increased as a result of changes in the input structure of the electricity of the services sector, such as “electricity → amusement and recreation facilities → household demand”, “electricity → retail trade → household demand” and “electricity → public administration (local) → local government demand”, indicating increasing dependence of services on energy input. I also find that the final demand shift changed CO2 emissions, for example the rise in demand for integrated circuits in exports has contributed to increasing CO2 emissions generated from electricity, the fall in demand for frozen fish and shellfish in household demand has contributed to decreasing CO2 emissions from marine fisheries.

► This paper analyzes the key supply chains involved in changes in CO2 emissions associated with Japan's overall demand. ► This paper uses the Structural Path Decomposition method (SPD) applied to the Japanese environmental input-output tables. ► The results reveal that CO2 emissions increased as a result of increased input of the electricity to the services sector. ► The final demand shift changed CO2 emissions, for example the rise in demand for integrated circuits in exports. ► The fall in demand for frozen fish and shellfish in household demand decreased CO2 emissions from marine fisheries.