A spatial shift-share decomposition of electricity consumption changes across Italian regions

This paper explores the changes in regional electricity consumption at the NUTS 3 level in Italy over the period 2000-2013. The analysis of regional electricity consumption changes is carried out by introducing a spatial shift-share decomposition measuring the neighbourhood effect on regional energy efficiency change. Our findings show that a shift toward less electricity-intensive activity sectors has occurred in almost all regions, reducing regional electricity consumption. A fall in economic activity has contributed to reducing electricity consumption in many regions, especially in Southern Italy. Notwithstanding the negative contributions of changes in industry-mix and economic activity, electricity consumption has increased in most regions due to the increase in electricity intensity. The increase in electricity intensity in Southern and North-Eastern regions has been enhanced by a neighbourhood disadvantage in energy efficiency. Electricity intensity has decreased in most NUTS 3 regions in Sardinia, an Italian region at the NUTS 2 level, due to both regional and neighbourhood advantages in energy efficiency.