How Did the Changes in Industrial and Energy Structure Influence Energy Consumption in Shandong, China?

Abstract

The Gross Regional Product (GRP) of Shandong ranks third in China, but its energy and coal consumption rank first. However, in the past studies, no effort was made to analyze the influence of Shandong energy conservation and emission reduction policies on energy consumption changes. To make up for this gap, the revised divisia index and the energy consumption structure methods were used in this study to analyze the driving force of changes in energy consumption in Shandong from 2005 to 2016. The results of this research show that: Firstly, the control of energy-intensive industries and strong energy conservation policies had become the main driving forces for energy density reduction. Secondly, the energy structure optimization policies only increased the proportion of hydro, nuclear and new energy production to replace a proportion of oil, but could not effectively reduce the consumption and proportion of coal. The continuous increase in coal consumption offset the energy conservation effect by key industries during the Twelfth Five-Year Plan period. It is clear that a reduction in the amount of coal used and an increase in the proportion of hydro, nuclear and new energy (especially in the industrial sector) is at the core of the energy problems in Shandong. Policy recommendations are proposed that are based on the findings of this study.