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Decoupling efficiency from electricity intensity: An empirical assessment in the EU

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  • Perillo, Frederico
  • Pereira da Silva, Patrícia
  • Cerqueira, Pedro A.

Abstract

A naive analysis of electricity intensity is not very informative since deviations in this indicator entail the consequences of changes in its components. The objective of this paper is to address these components, decomposing the electricity intensity in the European Union from 1995 to 2019. Complementing the LMDI method (Ang, 2015), this paper proposes an improvement by adding a new element to the decomposition methodology. Subsequently, three components of electricity intensity are explored: structure, efficiency, and electrification. This enhancing innovative feature is fundamental to distinguish the actual influence of energy efficiency on electricity intensity from that of the other elements. Results demonstrated that the efficiency component impact was greater than it first appeared. As the goals of public policies such as 20-20-20 EU have been intensified, policy makers need to keep promoting technological innovations since the relevant contribution of the efficiency component was supported by reasonable evidence and the adopted strategies have generated solid results regarding the electricity intensity indicator.

Suggested Citation

  • Perillo, Frederico & Pereira da Silva, Patrícia & Cerqueira, Pedro A., 2022. "Decoupling efficiency from electricity intensity: An empirical assessment in the EU," Energy Policy, Elsevier, vol. 169(C).
    • Handle: RePEc:eee:enepol:v:169:y:2022:i:c:s0301421522003937
    DOI: 10.1016/j.enpol.2022.113171
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