Index decomposition analysis of residential energy consumption in China: 2002-2010

Residential energy consumption in China increased dramatically over the period of 2002-2010. In this paper, we undertake a decomposition analysis of changes in energy use by Chinese households for five energy-using activities: space heating/cooling, cooking, lighting and electric appliances. We investigate to what extent changes in energy use are due to changes from appliances and to change in floor space, population and energy mix. Our decomposition analysis is based on the logarithmic mean Divisia index technique using data from the China statistical yearbook and China energy statistical yearbook in the period of 2002-2010. According to our results, the increase in energy-using appliances is the biggest contributor to the increase of residential energy consumption during 2002-2010 but the effect declines over time, due to energy efficiency improvements in those appliances. The second most important contributor is floor space per capita, which increased with 28%. Of the four factors, population is the most stable factor and energy mix is the least important factor. We predicted electricity use, with the help of regression-based predictions for ownership of appliances and the energy efficiency of appliances. We found that electricity use will continue to rise despite a gradual saturation of demand.