Carbon vs. Energy Intensity

The data in this post be Maximilian Auffhammer surprised me

Carbon vs. Energy Intensity | Energy Economics Exchange

To frame my thinking, I went back to the famed Kaya identity, which underlies much of the IPCC’s approach to modeling emissions scenarios. It decomposes emissions as follows:

CO2 = Population * (GDP/Population) * (Energy/GDP) * (CO2/Energy)

The general thinking is that higher population and higher per capita income lead to higher emissions (as there is no solid evidence of a Kuznets curve for CO2, where per capita emissions start dropping at higher incomes). What I like about The Kaya identity over Holdren and Ehrlich’s IPAT identitiy, is that it decomposes the T slightly further into the energy intensity of GDP and the carbon intensity of energy at the national level. While this is of course obvious to most people working on this problem, I think it is worth pointing out that in this framework lower CO2 emissions come from two sources:

• a less energy intensive economy
• less carbon intensive energy consumption

...The left panel displays the trajectory of energy consumption divided by real GDP for the US (solid line) and China (dashed line). What we see for both countries is a relatively steady drop in the energy intensity (2% p.a for the US and 4% for the PRC). The right panel displays total CO2 emissions divided by energy consumption. For the US we note a 0.3% p.a. drop in carbon intensity. For China, we observe a 1.1% p.a. increase in the carbon intensity of energy.

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