Decomposition methodology in industrial energy demand analysis

We discuss some methodological and application issues related to decomposing national industrial energy consumption into changes associated with aggregate industrial production level, production structure and sectoral energy intensity. Past studies are classified and reviewed with respect to study scope and decomposition technique. A framework for decomposition method formulation which incorporates three different approaches is presented. Several specific methods are described and their applications are illustrated with an example. Relevant application issues, such as method selection, periodwise vs time-series decomposition, significance of levels of sector disaggregation, and result interpretation are discussed.