Energy consumption in the reforming China

Abstract

The launch of the economic reform in 1980 has brought about remarkable changes to the energy consumption patterns of China. In particular, the industrial sector experienced an unprecedented fall in its energy intensity after the reform. In order to explain this change, a quantitative analysis has been employed to decompose the energy use change into three different effects: output growth effect, structural effect and conservation effect. Contrary to some authors' belief, the drop in energy intensity did not stem from the structural change. Rather it was a result of the significant efficiency improvement in energy consumption, particularly of the two most energy intensive industries, over a substantial period after the reform. Furthermore, a similar analysis has been applied to the household sector. The result shows that the single, most important factor that lied behind the rapid growth of household consumption was the massive migration from rural areas to urban cities, moderated by the negative population growth effect and intensity change effect.