Decomposition of energy-related CO2 emissions in China's iron and steel industry: A comprehensive decomposition framework

The rapid growth of CO2 emissions is not only due to increased energy consumption but also to multiple driving factors. Based on data from 2000 to 2014, this study proposes a comprehensive decomposition framework that combines production-theoretical decomposition analysis with index decomposition analysis to identify the driving factors of CO2 emissions from China's iron and steel industry. Furthermore, the different characteristics and drivers of CO2 emissions have been analyzed at the national, regional and provincial levels. The results indicate the following: (1) During 2000-2014, the average annual growth of CO2 emissions from China's iron and steel industry is 11.23%, and economic activity is the main reason for the dramatic increase. (2) Desirable output technology change has the greatest potential to mitigate CO2 emissions, followed by energy usage efficiency and energy saving technology change. Furthermore, the desirable output technology change and energy saving technology change are the constraint factors for CO2 emissions in all provinces. (3) Energy mix change, potential energy intensity change and desirable output technological efficiency generate important effects on the growth of CO2 emissions in most provinces. (4) The effects of energy usage efficiency to mitigate CO2 emissions in eastern region are not as great compared with those in central and western regions, and have mixed result across provinces. Therefore eliminating obsolete production capacities, improving R&D investment, accelerating the application of advanced technologies, reforming the ownership of enterprises and encouraging private and foreign investment represent the primary measures for mitigating the CO2 emissions from China's iron and steel industry.