INTENSITY OF ENERGY USE: MANUFACTURING
and Production Patterns
of Energy Use in Manufacturing.
Brief Definition: Energy
consumption per unit of manufacturing output.
of Measurement: Megajoules
(mJ) per unit output of the manufacturing sector in constant US dollars.
in the CSD Indicator Set: Economic/Consumption and Production Patterns/Energy Use.
Purpose: The manufacturing sector is a major consumer of energy.
This indicator is a measure of the efficiency of energy use in
the sector that can be used for analysing trends and making
international comparisons in energy efficiency, particularly when the
indicator can be disaggregated to specific branches of manufacturing.
to Sustainable/Unsustainable Development (theme/sub-theme):
Sustainable development requires increases in energy efficiency in order
to reduce fossil fuel consumption, greenhouse gas emissions and related
air pollution emissions.
International Conventions and Agreements: UNFCCC and its Kyoto Protocol.
Targets/Recommended Standards: Although
there are no specific international targets regarding energy use or
energy efficiency, many industrialized countries have targets for
reducing energy use and carbon emissions from manufacturing branches.
to Other Indicators: This indicator is one of a set for energy intensity in different
sectors (manufacturing, transportation, commercial/services and
residential), with the indicator for energy use per unit of GDP as an
aggregate energy intensity indicator. These indicators are also linked to indicators for total energy
consumption, greenhouse gas emissions, and air pollution emissions.
Definitions and Concepts: Energy
consumption per unit of value added is one way of measuring energy
requirements and energy efficiency in manufacturing. While energy consumption per unit of physical output is a better
indicator of energy efficiency in specific manufacturing processes,
energy use per unit of economic output is more useful both for relating
energy efficiency to economic activity and for aggregating and comparing
energy efficiency across manufacturing sectors or across the entire
use is usually measured at the point of consumption, i.e., the factory
or establishment. “Own energy” (including internal use of
hydropower, biofuels, or internal waste heat) should be combined with
purchased energy at useful heating values. For combined production of
heat and electricity, no simple method exists for dividing the total
energy consumed between these two outputs. Where excess heat or electricity is sold or provided to outside
establishments or a grid, the energy required for this out-going supply
should not be allocated to the product of the establishment or branch
and the income or apparent value added from these sales should be
excluded from output value.
some cases, it may be preferable to measure total primary energy
consumption, including losses incurred in the external production and
distribution of the purchased electricity and heat, since these losses
would occur if the establishment or branch used the primary energy
directly. Primary energy consumption is a better measure of the total
energy burden on the economy of a unit of output from an industry.
Generally, the energy loss from converting primary energy to
electricity is estimated by the average ratio for electricity production
in the economy.
in interpreting energy intensity data arise from the fact that some
branches of manufacturing may be concentrated in regions of a country
rich in certain kinds of power or heat sources, such that those branches
constitute a lower energy burden on the economy than the indicator would
suggest. Interpretation is
also complicated when a particular branch has significant internal
energy resources, such as captive hydro, biofuels or coal. There are various conventions for calculating the primary energy
corresponding to electricity produced by nuclear, hydro or geothermal
It is also possible to measure total energy consumption, internal and
external, for any final product by using input-output tables to measure
the energy embodied in materials and intermediate products. This is much
more data intensive, because the input-output tables are complex. Such
tables are not produced regularly, so this approach is difficult to
follow, except at long intervals.
Unit: Preferable units for measuring energy are multiples of joules,
usually terajoules (1012J), petajoules (1015J), or
· Output. There
are different approaches for measuring output in manufacturing. For some
purposes, physical output would be preferable, but this is not possible
using the energy consumption statistics available in many countries, and
there are many sectors for which aggregate physical output cannot be
are two basic alternatives for measuring economic output. In either case, we use real local currency, deflated by the
deflator for the sector or branch to a base year. This step is crucial, so that the weight of each sector or branch
reflects the correct weight in the base year. The value of output is then converted to a common international
currency, usually US dollars, preferably using purchasing power parities
(PPP). One alternative is to calculate the total value of production or
shipments. This measures
literally the total output from an industry, and is defined for most
countries. The other
alternative is to calculate the value-added or contribution to GDP,
representing only the increase in economic output produced by the sector
or branch in question.
The total value of output tends to be more stable over time, but has the
disadvantage that it cannot be aggregated to total output, because of
double counting: inputs to one branch may be the outputs of another
branch. Value added can be
aggregated, but may have greater fluctuations from year to year if input
costs or output prices change, which is common for many basic raw
materials, particularly crude oil. Unfortunately, there is no simple correspondence between the two
measures of output.
Unit: Constant US dollars. Market
value of output in real local currency deflated to a base year using GDP
deflators for each sector or branch. Local currency is converted to US dollars, using purchasing power
parity for the base year.
of the Indicator: The aggregate indicator for the manufacturing sector reflects
both the energy intensity of various branches of manufacturing and the
composition of the manufacturing sector. Changes in the aggregate indicator can therefore be due either to
changes in energy intensity or to changes in relative branch output.
Similarly, differences between countries may be due either to
differences in energy efficiency or differences in the structure of the
manufacturing sector. A
country with large energy-intensive industries, such as pulping, primary
metals or fertilizers, for example, will have a high energy intensity,
even if the industry is energy efficient. For this reason, it is desirable to disaggregate energy intensity
by branch of manufacturing.
Detailed calculations such as total energy consumption for particular
products, using input-output tables, while desirable, are very data
intensive and difficult to update regularly.
(d) Status of the
methodology is in use in many developed countries.
Definitions/Indicators: In the context of climate change, it
has become increasingly desirable to convert energy consumption to
carbon emissions per unit of production. The fuels consumed can be converted to carbon emissions using
IPCC coefficients. Carbon emissions will therefore change both with
changes in energy efficiency and changes in fuel type.
4. ASSESSMENT OF DATA
needed to Compile the Indicator:
(i) Energy consumption by manufacturing sector and branches;
Real output of the sector and branches.
International Data Availability and Sources: Value added in manufacturing at the three and four digit ISIC
level for most OECD countries is now compiled by OECD as part of its
STAN data base. The United
Nations compiles value added at the two or three digit level for
developed and developing countries. The European Union produces data on value added at the two and
three-digit level in the NACE system, and suitable bridges exist to
translate NACE into ISIC.
persistent data problem at the aggregate level is distinguishing between
“industry” (ISIC C, D, F and even E) and manufacturing (ISIC D).
Some countries also lump agriculture, forestry and fishing (ISIC
A, B) in the aggregate “industry” classification. For these reasons, it is strongly recommended that data be
checked to ascertain exactly what sectors are covered. Manufacturing is the preferable aggregate, since inclusion of the
other sectors mentioned can distort time series analysis and comparisons
Energy Balances of Member Countries
Energy Balances of non-Member Countries
Latin American Energy Organization /OrganizacRon
Latinoamericana de EnergRa (OLADE)
Pacific Energy Research Centre (APERC)
Industrial Statistics, National Accounts
STAN database (structural analysis database)
5. AGENCIES INVOLVED IN THE DEVELOPMENT OF THE INDICATOR
(a) Lead Agency: The lead agency is the International Energy Agency
(b) Other Contributing
Organizations: OECD and
IEA have collected detailed value added and energy consumption data at
the four-digit level in the ISIC database. Less detailed two-digit data are also available.
IEA now collects two-digit energy consumption data for
manufacturing for about half of the developing countries as well.
1997 issue, Elsevier Science Limited, various articles in this issue
discuss the physical and monetary measures of output and various
problems associated with indicators of manufacturing energy use and
G.J.M, Blok, K., and Worrell, E., 1997. Handbook
on International Comparison of Energy Efficiency in the Manufacturing
Industry. Utrecht: Dept. of Science, Technology, and Society.
1997. Indicators of Energy Use and Energy Efficiency. Paris:
Energy Agency: http://www.iea.org