Change in Industrial Energy Consumption in Gansu Province and Its Impacting Factors

Economic growth and energy saving need to be integrated with the promotion of economic growth and reduction of energy consumption. In this paper, the energy consumption of 24 sub-industries in the industrial sector of Gansu Province during the period 2001-2008 was studied. First, the proportion of energy consumption for each sub-industry and its changes was analyzed. Second, the output elasticity of energy consumption was applied to analyze the relative relationship between incremental changes of energy consumption and industrial output value, focusing on evaluation of the sustainable state of several energy-intensive sub-industries. Then, the improved structure decomposition method was used to analyze the role of sector structural change and sector energy intensity change on industrial energy intensity change. By further decomposition of changes in product mix and product intensity on sector intensity change, the real role of sector structural change on industrial energy intensity change was identified. The main contribution of this study was that it was not only specified to each sub-industry in the industrial sector, but also to product level taking the oil processing sub-industry as an example. Data used in this study were collected from Gansu Statistical Yearbook for each study year and survey work for the special plan of energy conservation in Gansu Province for‘Twelfth Five Years’. Results show that energy consumption of the industrial sector concentrated primarily in six energy-intensive sub-industries, and exhibited a further expanding trend. With increasing economic development and social progress, the conflict between energy supply and demand will be intensified, achieving the purpose of energy saving by sector restructuring, which was clearly inconsistent with the facts of Gansu Province. It was more appropriate to reduce energy consumption by improving energy efficiency for each sub-industry. As only the industry of electricity and heat production and supply was under sustainable state, the energy saving potential of other five energy-intensive sub-industries remained to be excavated further. High-tech transformation of petrochemical and ferrous metallurgy industry, and structural upgrade and chain extension of building materials industry should be useful to improve the sustainable state of these five energy-intensive sub-industries. The sector energy intensity change dominated the industrial energy intensity change, but it included the role of changes in product mix and value-added and thus amplified that of sector energy intensity. Separating the role of product intensity from sector energy intensity could truly reflect the position of structural adjustment and technical improvement in reducing industrial energy intensity.