Energy 68 (2014) 688e697

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Energy
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Analysis of energy-related CO2 (carbon dioxide) emissions

and reduction potential in the Chinese non-metallic mineral
products industry
Boqiang Lin a, b, *, Xiaoling Ouyang c
a
New Huadu Business School, Minjiang University, Fuzhou 350108, China
b
Collaborative Innovation Center for Energy Economics and Energy Policy, Institute for Studies in Energy Policy, Xiamen University,
Xiamen, Fujian 361005, China
c
School of Energy Research, College of Energy, Xiamen University, Xiamen 361005, China

a r t i c l e i n f o a b s t r a c t

Article history: As one of the six highest energy-consuming industries, non-metallic mineral products industry accounts
Received 23 October 2013 for 9.5% of national energy usage and 9.0% of energy-related CO2 (carbon dioxide) emissions in China. In
Received in revised form this paper, we evaluate the CO2 emissions change from energy consumption and present a compre-
11 January 2014
hensive picture of the underlying determinants of emissions change in the Chinese non-metallic mineral
Accepted 18 January 2014
Available online 20 February 2014
products industry for the period 1986e2010, based on the LMDI (Logarithmic Mean Divisia Index)
method. Results demonstrate that industrial activity is the leading force explaining emission increase
while energy intensity is the major contributor to the emission mitigation. Effects of industrial scale and
Keywords:
CO2 emissions change
carbon intensity of energy show varying trends interchanging intervals of growth along the study period.
Energy consumption Moreover, substitution effect has a small negative impact on the increase of CO2 emissions. Reduction
The LMDI method potential of CO2 emissions is predicted to be 99.02 Mt in 2020 under the scenario of moderate emission
Emission reduction potential reduction, which accounts for 0.30% of the world’s energy-related CO2 emissions in 2011; and 188.88 Mt
Non-metallic mineral products industry under the scenario of aggressive emission reduction, which accounts for 0.58% of the world’s total in
China 2011 and is close to energy-related CO2 emissions of Egypt in 2010. Policy recommendations are thus
made for future emission reductions.
Ó 2014 Elsevier Ltd. All rights reserved.

1. Introduction First, it is highly energy-intensive and is one of the highest energy-

1.1. The research background
Continual growth of CO2 (carbon dioxide) emissions in China has
been the center of attention both domestically and internationally
[1e3]. The industrial sector is the largest primary energy-use sector
in China that is extremely energy-intensive and responsible for
associated CO2 emissions [4]. Considering the leading role that the
industrial sector has played in CO2 emissions in China, it is neces-
sary to investigate the influencing factors of CO2 emissions change
from energy consumption in the major industrial subsectors so as to
provide recommendations to policy makers.
The non-metallic mineral products industry was chosen as the
study object for three reasons:
* Corresponding author. New Huadu Business School, Minjiang University, Fuz-
hou, Fujian 350108, China. Tel.: þ86 5922186076; fax: þ86 5922186075.
E-mail addresses: bqlin@xmu.edu.cn, bqlin2004@vip.sina.com (B. Lin).
consuming industries in China. Energy consumption of non-metallic
mineral products industry accounted for 9.5% of national and
13.5% of industrial and 16.4% of manufactural energy usage during
1985e2011. Energy consumption of the Chinese non-metallic min-
eral products industry was 300.15 million tonnes of coal equivalent
(Mtce) in 2011, which was higher than the total energy consumption
of Iran (293.36 Mt) in the same year [5]. The huge amount of energy
consumption highlights its importance in the research area.
Second, it is one of the most carbon-intensive industries in
China. CO2 emissions from energy consumption in the non-metallic
mineral products industry amounted to 544.82 Mt in 2011 e higher
than the energy-related CO2 emissions of the United Kingdom in
2010 (528.89 Mt), accounting for 1.67% of the world’s and 6.3% of
China’s energy-related CO2 emissions [6]. Considering its pre-
dominance in China’s CO2 emissions, it is extremely important to
investigate the potential of CO2 emissions reduction.
Third, it has a typical energy consumption structure. Fuel mix
of the Chinese non-metallic mineral products industry has been

http://dx.doi.org/10.1016/j.energy.2014.01.069
0360-5442/Ó 2014 Elsevier Ltd. All rights reserved.
 B. Lin, X. Ouyang / Energy 68 (2014) 688e697
dominated by coal, of which the consumption accounted for 7.3% of
national, 7.7% of industrial and 19.5% of manufactural coal usage in
2011. Considering the competitive price and relative abundant re-
sources of coal, coal-dominated energy structure is difficult to
reverse in the short term [7]; and it is clear that China’s future
economic growth is unsustainable [8]. Therefore, considering its
representativeness, it is crucial to capture determinants of energy-
related CO2 emissions change in the Chinese non-metallic mineral
products industry.
1.2. The contribution of this study
Both energy consumption and the related CO2 emissions in the
Chinese non-metallic mineral products industry have shown up-
ward trends over the years. On the other hand, China’s urbanization
and industrialization process will not come to an end until 2020 [9],
implying that the industrial growth will still be the leading force
driving economic growth and energy consumption. The challenge
of CO2 emissions reduction from the non-metallic mineral products
industry is particularly important because of its key role in ur-
banization process and the realization of China’s transition into a
low-carbon economy. In this context, this paper intends to address
the following important questions: First, what are the major factors
that influence CO2 emissions change from energy consumption in
the Chinese non-metallic mineral products industry? Second, what
degree of influence of each factor? Third, how much emission
reduction potential does the non-metallic mineral products in-
dustry have? Fourth, what policy implications can we draw in the
aspect of mitigating CO2 emissions from industrial sectors in China?
Answers to these questions are meaningful for the low-carbon
transition strategy in China as well as the sustainable develop-
ment of industrial sectors. China’s economic and industrial devel-
opment will face the issue of transition when economic growth
slows down after 2020. The industrial development will no longer
be extensive and supported by wasteful energy consumption; more
importantly, it will be constrained by a low-carbon economy.
The remainder of this paper is structured as follows. Section 2
presents the literature review. Section 3 describes the methodol-
ogy and data source and provides an overview of the industry.
Section 4 discusses the empirical results of our study. Section 5
summarizes our findings and provides policy recommendations.
2. Literature
With the global warming becoming a serious issue in the world,
decomposition analysis of CO2 emissions has been a hot issue in
academia since the 1980s. In the application areas, there have been
more studies dealing with industrial energy usage and energy-
related gas emissions [10]. The advantages of the IDA (index
decomposition analysis) are that it assesses the driving forces that
underlie CO2 emissions change and presents implications for CO2
emissions mitigation [11]. There are a set of decomposition
methods linked to the Divisia index [12,13] and the Laspeyres index
[14] in the index decomposition analysis. Within the Divisia index,
the LMDI (logarithmic mean Divisia index) method was first
introduced by Ang and Choi [15], Ang et al. [16], which can be
conveniently applied in comparative studies of cross-country/
region energy and environmental issues [17,18]; therefore, it was
recommended as the preferred method because of its theoretical
foundation, adaptability, ease of use and result interpretation [11].
Ang [19] further presented a useful guide of the LMDI approach. In
2001, Ang and Liu [20] presented a new energy decomposition
method, called the Log-Mean Divisia Index Method I (LMDI I) and
concluded that the method has the desirable properties of perfect
decomposition and consistency in aggregation. In terms of ease of
689
application and flexibility, Ang et al. [21] concluded that the LMDI
methods, in particular LMDI I, have several advantages over other
perfect decomposition methods in energy and environmental
analysis. Aiming at handling zero values in the LMDI approach, Ang
and Liu [22] compared the SV (small value) and AL (analytical limit)
strategies, and extended earlier works by generalizing the analyt-
ical limits of LMDI. In order to expand research, Ang et al. [23]
analyzed the relationship between LMDI II and LMDI I, and
further supported the recommendation made by Ang [11] that
LMDI is the “preferred” IDA method.
Applications of the LMDI method in investigating carbon
emissions have been initiated in a number of earlier studies. In this
article, we review the recent studies as well as major determinants
of CO2 emissions change in chronological order. By applying the
LMDI method, Wang et al. [24] analyzed the change of aggregated
CO2 emissions in China from 1957 to 2000. Results indicated that
energy intensity, fuel switching and renewable energy penetration
exhibited positive effects to the decrease in CO2. Liu et al. [25]
analyzed the change of industrial carbon emissions from 36 in-
dustrial sectors in China over the period 1998e2005 and showed
that the overwhelming contributors to the change of China’s in-
dustrial sectors’ carbon emissions were industrial activity and en-
ergy intensity. Ma and Stern [26] focused on the fall and resurgence
in China’s carbon emissions since the mid-1990s. Results demon-
strated that the positive effect of population growth had been
decreasing over the period 1971e2003. Malla [27] examined the
role of three factors (electricity production, electricity generation
structure and energy intensity of electricity generation) affecting
the evolution of CO2 emissions from electricity generation in seven
AsiaePacific and North American countries. Results showed that
production was the major factor responsible for rise in CO2 emis-
sions while energy intensity was responsible for modest reduction
in CO2 emissions during the period 1990e2005. Zhao et al. [28]
decomposed the influencing factors of ICE (industrial carbon
emissions) in Shanghai, China. Results demonstrated that the in-
dustrial output was the main driving force of ICE while energy
intensity, energy adjustment and industrial structure were major
determinants for reduction of ICE. Zha et al. [29] investigated fac-
tors that may affect the changes of energy-related CO2 emissions
from urban and rural residential energy consumption during 1991e
2004. Results showed that energy intensity and the income effects,
respectively, contributed most to the decline and the increase of
residential CO2 emissions for both urban and rural China. Oh et al.
[30] analyzed the specific trends and influencing factors that had
caused changes in emission patterns in economic sectors in South
Korea over 1990e2005. Results indicated that economic growth
was a dominant explanation for the increase in CO2 emissions in
manufacturing, services and residential sectors, while energy in-
tensity was an important driver of CO2 reduction in most sectors
except for several manufacturing sub-sectors. Akbostancı et al. [31]
decomposed the changes in the CO2 emissions of Turkish
manufacturing industry and found that industrial activity and en-
ergy intensity were the primary factors determining CO2 emissions
change. Zhang et al. [32] decomposed energy-related carbon
emissions of 30 provinces in China during 1995e2009 by four
causal factors e GDP (gross domestic products), economic struc-
ture, energy intensity, and fuel mix. Results demonstrated that GDP
and energy intensity were the major factors contributing to the CO2
emissions change. Liu et al. [33] explored driving forces of China’s
regional and sectoral GHG emission. Results indicated that the
inequity of technology level among regions was a main barrier for
China’s CO2 mitigation. Hammond and Norman [34] used LMDI
method to separate the contributions of changes in output, indus-
trial structure, energy intensity, fuel mix and electricity emission
factor to the reduction in energy-related carbon emissions from UK
690 B. Lin, X. Ouyang / Energy 68 (2014) 688e697

manufacturing. Results showed that the reduction in energy in-
tensity was the primary reason for the fall in emissions between
1990 and 2007. Fujii et al. [35] analyzed the effects of the changes
made in China’s industrial sector on the three main air pollutants
between 1998 and 2009. Shao et al. [36] analyzed carbon emissions
from energy consumption of the industrial sector in City Tianjin,
China. Results showed that improvements in energy utilization
efficiency were the most important contributors to effective in-
dustrial energy conservation and emission reductions.
From the present literature, although the application of LMDI
method is mainly in the area of industrial energy and environmental
analysis, research on energy-related CO2 emissions in China’s in-
dustrial sectors is still limited. Moreover, to the best of our knowl-
edge, no studies have been conducted on CO2 emissions change in
the Chinese non-metallic mineral products industry in spite of its
important role in China’s energy demand and related CO2 emissions.
3. Methodology and data source
3.1.2. Decomposition method
This paper adopts the Logarithmic Mean Divisia Index (LMDI)
method to analyze CO2 emissions change from energy consump-
tion. The change in CO2 emissions of the Chinese non-metallic
mineral products industry (DCO2) between a base year 0 and an
end year T can be decomposed into the effects of (i) the change in CI
(carbon emissions per unit of fossil-fuel, termed the carbon in-
tensity effect, CIeff); (ii) the change in S (the share of fossil fuels in
total energy, termed the substitution effect, Seff); (iii) the change in
EI (energy consumption per unit of industrial value added, termed
the energy intensity effect, EIeff); (vi) the change in IA (the indus-
trial value added per worker, termed the industrial activity effect,
IAeff) and (v) the change in IS (employment; termed the industrial
structural effect, ISeff):
DCO2 ¼ CO2 ðTÞ  CO2 ð0Þ ¼ CIeff þ Seff þ EIeff þ IAeff þ ISeff (4)
The effects, in turn, can be calculated from the following formula
using the LMDI method:

3.1. Decomposition analysis CO2 ðTÞ  CO2 ð0Þ

CIeff ¼ *ln½CIðTÞ=CIð0Þ (5)
ln½CO2 ðTÞ=CO2 ð0Þ
3.1.1. Model construction
The following symbols are defined, in order to present the CO2 ðTÞ  CO2 ð0Þ
methodology used in this paper: Seff ¼ *ln½SðTÞ=Sð0Þ (6)
ln½CO2 ðTÞ=CO2 ð0Þ

TOE ¼ total energy consumption

CO2 ðTÞ  CO2 ð0Þ
GDP ¼ the gross domestic product EIeff ¼ *ln½EIðTÞ=EIð0Þ (7)
POP ¼ population ln½CO2 ðTÞ=CO2 ð0Þ
EFF ¼ energy consumption from fossil fuels
CI ¼ CO2 emissions per unit of fossil-fuel CO2 ðTÞ  CO2 ð0Þ
IAeff ¼ *ln½IAðTÞ=IAð0Þ (8)
S ¼ the share of fossil fuels in total energy ln½CO2 ðTÞ=CO2 ð0Þ
EI ¼ energy consumption per unit of IVA (industrial value
added) CO2 ðTÞ  CO2 ð0Þ
IA ¼ industrial value added (IVA) per worker ISeff ¼ *ln½ISðTÞ=ISð0Þ (9)
ln½CO2 ðTÞ=CO2 ð0Þ
IS ¼ employment1
Based on the above equations, CO2 emissions change from energy
The decomposition of fossil fuel CO2 emissions into related consumption in the Chinese non-metallic mineral products industry
factors dates back to a series of studies undertaken in the 1980s, can be calculated. We use relevant data over 1986e2010 and sepa-
mainly at industry level for a single industrialized country [37]. rate the period into five time intervals for easier data management:
Kaya [38] proposed the Kaya Identity and decomposed the CO2 1986e1990, 1991e1995, 1996e2000, 2001e2005 and 2006e2010
emissions into several affecting variables: [7]. The set of intervals is reasonable because time intervals of the
national economic development plans in China are five years [32].
CO2 TOE GDP In order to estimate the reduction potential of energy-related
CO2 ¼ * * *POP (1)
TOE GDP POP CO2 emissions, we further construct the decomposition model.
According to equation (4), if the effects of CO2 emissions per unit of
Equation (1) established the relationship between carbon di-
fossil-fuel (CIeff), substitution (Seff), energy intensity (EIeff), indus-
oxide emissions and determinants of CO2 emissions change such as
trial activity (EIeff) and industrial scale (ISeff) from a base year 0 to a
carbon dioxide emissions per unit of energy usage, energy utiliza-
target year T can be estimated, the CO2 emissions in year T therefore
tion efficiency, level of economic development and population. In
can be forecast as equation (10):
this article, equation (1) has subsequently been expanded as:
CO2 ðTÞ ¼ CO2 ð0Þ þ CIeff þ Seff þ EIeff þ IAeff þ ISeff (10)
COt2 EFFt TOEt GDPt
COt2 ¼ * * * *POPt (2)
EFFt TOEt GDPt POPt We assume that a, b, d, f and g are the change rates of the CI
(carbon intensity) effect, S effect, EI effect, IA effect and IS effect
Identities in equation (2) focus on CO2 emissions from the
from a base year 0 to a target year T, respectively. Therefore,
combustion of fossil fuels. For a specific industrial sector, the above
CI(T) ¼ CI(0)*(1 þ a), S(T) ¼ S(0)*(1 þ b), EI(T) ¼ EI(0)*(1 þ d),
equation can be rewritten as:
IA(T) ¼ IA(0)*(1 þ f), IS(T) ¼ IS(0)*(1 þ g). Thus,
COt2 EFFt TOEt IVAt t CIeff ¼ W*lnð1 þ aÞ (11)
COt2 ¼ * * * *IS ¼ CI*S*EI*IA*IS (3)
EFFt TOEt IVAt ISt
Seff ¼ W*nð1 þ bÞ (12)

EIeff ¼ W*lnð1 þ dÞ (13)

1
Generally, an increase in employment implies the expansion of an economic
sector, so that the indicator of employment in this paper is used to represent the
industrial scale effect. IAeff ¼ W*lnð1 þ 4Þ (14)
 B. Lin, X. Ouyang / Energy 68 (2014) 688e697
ISeff ¼ W*lnð1 þ gÞ
where
CO2 ð0Þ*½ð1 þ aÞ*ð1 þ bÞ*ð1 þ dÞ*ð1 þ 4Þ*ð1 þ gÞ  1
W ¼
ln½ð1 þ aÞ*ð1 þ bÞ*ð1 þ dÞ*ð1 þ 4Þ*ð1 þ gÞ
Based on the above model, future CO2 emissions can be pre-
dicted and contributions of each factor can be quantified.
3.2. Data source and industry overview
3.2.1. Data source
This article is based on annual data covering the period from
1986 to 2010. All data are collected from China Statistical Yearbook
[39].
Carbon dioxide emissions from fossil fuel consumption are
calculated by:
X
16 X
16
CO2 ¼ CO2 ¼ Ei *CFi *CCi *COFi *ð44=12Þ
i¼1 i¼1
In which, CO2 stands for the energy-related carbon dioxide
emissions; i represents the i-th energy; CFi is the conversion factor
from physical unit to kJoule (in this paper, the calculation took the
Appendix IV in China energy statistical yearbooks for reference
[40]); CCi is carbon content coefficient of fuel type i, which is
collected from the Intergovernmental Panel on Climate Change
[41]; COFi is the carbon oxidation factor; and 44/12 is the conver-
sion factor from carbon to carbon dioxide. In summary, CFi*CCi*-
COFi*44/12 is the coefficient of carbon dioxide emissions for the i-th
energy, which is assumed constant over time. In order to avoid the
double counting of CO2 emissions from the power generation in-
dustry, electricity consumption is regarded as clean.
However, we should note the limitations of the LMDI method-
ology in the aspect of application due to the use of current value for
energy content, conversion rates of different energy sources from
physical unit to kJoule, and emission factors in defining the emis-
sion performance of energy in a time-series analysis [7].
3.2.2. Industry overview
Non-metallic mineral products industry is a pillar industry in
China, of which the value added contributes to nearly one percent
of the GDP (gross domestic products) each year [42]. In 2011, main
business income of the non-metallic mineral products industry
amounted to 3929.48 billion CNY, accounting for 4.67% that of the
industrial sector [43]. Particularly, it greatly supports the under-
going rapid urbanization process in China, which propels the large-
scale construction of urban infrastructure and housing and requires
huge quantities of cement. As the world’s largest cement consumer,
China consumed 2048 metric tons of cement in the year 2011. The
large quantity of cement could only have been produced at home,
because no other country could afford supplying such large-scale
raw materials [44]. On the other hand, the growth of the Chinese
non-metallic mineral products industry is driven by the infra-
structure boost and will be further pushed ahead by national policy
[45]. The industrial valued added (IVA) increased greatly over the
past three decades from 20.79 billion CNY in 1985 to 337.76 billion
CNY in 2010 (at 1990 constant prices). The average annual growth
rate of IVA was 12.82% during 1985e2010, which was higher than
that of the GDP. Take the production volume of cement for example.
Since 1985, China has kept the record of the world’s largest cement
producer. Cement output increased from 144.28 Mt in 1985e
2184.04 Mt in 2010 e equivalent to a growth of 1413.66% [43].
691
(15)
(16)
Fig. 1. The trends of fossil-fuel energy consumption and CO2 emissions in the Chinese
non-metallic mineral products industry during 1985e2010.
Source: China Energy Statistical Yearbook [40], CEIC China Database [42].
Productions of other major products such as plate glass and ce-
(17) ramics also ranked top in the world.
Production growth in the non-metallic mineral products in-
dustry has led to rapid increase in energy consumption. During the
period 1985e2010, fossil fuel energy consumption (excluding elec-
tricity) increased from 77.47 Mtce to 244.63 Mtce; energy-related
carbon dioxide emissions grew from 185.05 Mt to 507.29 Mt, an
increase of 174.14%. The trends of fossil-fuel energy consumption
and CO2 emissions in the Chinese non-metallic mineral products
industry during 1985e2010 are shown in Fig. 1.
The average annual growth rate of fossil-fuel energy consump-
tion was 4.98% during 1985e2010, and energy-related CO2 emis-
sions were drove up by 4.49% annually. It is worth noting that both
fossil fuel energy consumption and the related CO2 emissions
increased significantly after 2002 due to China’s accelerated pro-
cess of urbanization. The average annual growth rate of fossil-fuel
energy consumption during 2003e2008 reached 12.41%, which
drove up the growth of related CO2 emissions at the rate of 12.08%.
Energy consumption structure of the Chinese non-metallic
mineral products industry was dominated by coal, of which the
consumption increased from 86.14 Mt in 1985 to 250.32 Mt in 2010
with an annual growth rate of 4.63%. The growth rates of natural
gas and electricity consumption were the highest among different
types of energy. Specifically, natural gas consumption increased
from 180 million cubic meters in 1985e6376.4 million cubic meters
in 2011 with the annual growth rate of 24.60%; electricity con-
sumption grew from 22.16 billion kWh to 291.79 billion kWh dur-
ing the same period, of which the annual growth rate was 10.58%.
The significant decline in coal consumption during 2000e2002 was
mainly due to the industrial restructuring, during which, a large
number of small companies went bankrupt. However, coal con-
sumption rose sharply back after 2003 due to the fixed asset in-
vestment growth and the overheated real estate industry. As shown
in Fig. 2, coal is the major contributor to CO2 emissions, followed by
fuel oil and coke. During 1985e2011, the average proportion of CO2
emissions from coal consumption in the total CO2 emissions in the
Chinese non-metallic mineral products industry was up to 90.60%;
and the average proportions of CO2 emissions from the consump-
tion of fuel oil and coke were 3.49% and 2.52%, respectively.
It can be seen from Fig. 2, coal played a key role in the total CO2
emissions in the Chinese non-metallic mineral products industry.
Most of the increase in the CO2 emissions during the study period
derived from the growth of coal consumption and coal-dominated
energy structure. Similarly, the decrease in CO2 emissions during
the period of 2000e2002 (industrial restructuring) was driven by the
reduction of coal consumption. Energy diversification helped to
692 B. Lin, X. Ouyang / Energy 68 (2014) 688e697
Fig. 2. Carbon dioxide emissions from energy consumption in the Chinese non-
metallic mineral products industry.
Source: China Energy Statistical Yearbook [40].
reduce the share of coal. Natural gas consumption increased
dramatically after 2004, of which the average growth rate during
2004e2011 was as high as 67.57%. During the same period, the
growth of electricity consumption reached 13.68%. In conclusion, the
substitution of cleaner energy to coal helped to mitigate the growth of
CO2 emissions in the Chinese non-metallic mineral products industry.
4. Results and discussion
4.1. Carbon dioxide emissions change during time intervals
Decomposition analysis can quantify the impact of each deter-
minant on CO2 emissions change from energy consumption by de-
gree. In this article, the study period is split into five time intervals
Fig. 3. Decomposition of CO2 emissions changes from energy consumption in the Chinese non-metallic mineral products industry.
during 1986e2010 (Fig. 3) for the following two reasons: first, China’s
national economic planning, which has significant impacts on the
macro-economy as well as the energy system, is based on the five-
year time interval; second, the impact of each factor on CO2 emis-
sions change among time intervals can be captured and compared.
Results show that there have been significant CO2 emissions
changes in the Chinese non-metallic mineral products industry
over the last 26 years. Identifying reasons of CO2 emissions change
would be helpful for policy design on mitigating the increase in CO2
emissions. As shown in Fig. 3, IA (industrial activity) effect was the
main force that led to the increase in CO2 emissions while EI (en-
ergy intensity) effect was the major contributor to the decline in
CO2 emissions. The IS (industrial scale) effect on CO2 change was
unstable among time intervals. In general, it contributed to the
increase in CO2 emissions. However, the IS effect led to the signif-
icant decline in CO2 emissions from 1996 to 2000 because of in-
dustrial restructuring. During the restructuring period, a large
number of private and small enterprises as well as the state-owned
companies went bankrupt, and lots of workers were laid off.
Shrinking industrial scale resulted in the decline in energy con-
sumption as well as the corresponding CO2 emissions. Moreover,
the substitution (S) effect contributed to CO2 emissions decrease
even though the degree of influence was quite small. The effect of
carbon intensity of energy (CI) showed a varying trend inter-
changing intervals (increasing and decreasing) during 1986e2010;
however, it was the cause for the decrease in CO2 emissions. The
above main results are consistent with the study of Ang [46], which
showed that energy intensity (energy/GDP) had a greater impact on
energy-related carbon emissions than carbon intensity of energy
(carbon/energy).
In order to conduct in-depth analysis, we analyze the influence of
each effect during the study period by degree. We observe that the
biggest contributor to the emissions increase was industrial activity
(IA) effect, which contributed 224.34 Mt CO2 during 1996e2000 and
217.44 Mt CO2 during 2001e2005, the highest amounts during the
 B. Lin, X. Ouyang / Energy 68 (2014) 688e697 693

time intervals. Even though the impact of IA showed a decreasing

trend after the time interval of 1996e2000, it was still the leading
force that pushed up the CO2 emissions in the Chinese non-metallic
mineral products industry. The energy intensity (EI) effect was the
major contributor to the decrease in emissions, of which the degree
of influence showed an increasing trend over the time intervals
from 17.54 Mt CO2 during 1996e2000 to 179.27 Mt CO2 during
2006e2010. The EI effect was quite significant during 2006e2010,
which was attributed to the national energy intensity reduction
target. In 2009, the Chinese government committed to reduce
energy intensity by 40%e45% in 2020 compared to the level in
2005. This target has been decomposed into three time intervals of
2009e2010, 2011e2015 and 2016e2020 for realization. Therefore,
we can expect that the EI effect would play a more important role in
reducing CO2 emissions in the Chinese non-metallic mineral prod- Fig. 4. Comparison of CO2 emissions and industrial value added trends in the Chinese
ucts industry in the future. The IS (industrial scale) effect, the second non-metallic mineral products industry.
largest influential factor of the CO2 emissions increase, contributed Source: China Statistical Yearbook [40].
117.68 Mt to CO2 emissions increase during 2006e2010.

11th Five-year Plan (2006e2010), which committed to reduce en-

4.2. An in-depth analysis of major influencing factors
Results of this paper demonstrated that the industrial activity
(IA) effect and the energy intensity (EI) effect were the leading
forces responsible for the CO2 emissions increase in the Chinese
non-metallic mineral products industry. An in-depth analysis is
conducted for the purposes of investigating possible reasons of CO2
emissions change, providing policy implications for mitigating CO2
emissions, and formulating development strategies for the Chinese
non-metallic mineral products industry in the context of a low-
carbon economy.
Carbon dioxide emission increase in the Chinese non-metallic
mineral products industry was mainly due to the industrial activ-
ity (IA) effect. As shown in Fig. 3, the increased CO2 emissions
contributed by the IA effect showed an inverted U-shaped trend
during the time intervals. The logic behind this phenomenon is
quite clear. With the promotion of urbanization in China, there was
an increasing demand of raw materials for the infrastructure con-
struction; therefore, the product output as well as industrial value
added (IVA) grew rapidly during the urbanization process. The
slopes of both IVA and CO2 emissions curves were relatively flat
before the year 2003 (Fig. 4). The annual average growth rate of IVA
was 10.05% during 1985e2002, which pushed up CO2 emissions
from energy consumption by 2.29% annually.
It is worth noting that the rapid growth of IVA due to the
accelerated urbanization process after 2002 did not lead to the
sharp increase in CO2 emissions. The average annual growth rate of
IVA reached 18.71% during 2003e2010 while the growth rate of CO2
emissions was only 9.18% during the same period. It was mainly
because of the industrial structure adjustment and the decreased
energy intensity. CO2 emissions due to the IA effect increased
dramatically in periods 1996e2000 and 2001e2005, which
reached 224.34 Mt and 217.44 Mt, respectively. However, the
decoupling of industrial growth and CO2 emissions was achieved
during 2006e2010 due to the mandatory reduction of energy in-
tensity, and the increased CO2 emissions contributed by the IA ef-
fect further decreased to 155.35 Mt during 2006e2010.
The decreased CO2 emissions contributed by the energy intensity
effect (EI) showed an overall upward trend during the time intervals.
Due to the industrial restructuring launched by the Chinese gov-
ernment, the negative impact of EI on CO2 emissions declined during
1996e2000. In the process of industrial restructuring, a large
number of private and state-owned companies went bankrupt,
leading to the deceleration in growth of output and IVA.
The influence of EI on CO2 emissions decrease was remarkable
during 2006e2010. It was mainly due to the target in the national
ergy intensity by 20% in 2010 compared to the level in 2005. How-
ever, the energy intensity reduction target was not realized by the
effective planning such as changing energy structure, improving
energy efficiency, promoting energy pricing reform, etc. As a matter
of fact, it was achieved by power rationing on high energy-
consuming industries such cement and steel industries in the late
2010. Moreover, to a certain extent, the 2008 financial crisis also
helped to reduce energy intensity in industrial sectors. Therefore, the
decreased CO2 emissions contributed by the EI effect during 2006e
2010 mainly counted on the elimination of backward production
capacities in high energy-consuming industries. The double indexes
were then introduced by the Chinese government, which stipulated
that both energy intensity and carbon intensity would decrease by
40%e45% in 2020 compared to the level in 2005. The index of carbon
intensity encompasses two meanings: first, the modification of en-
ergy structure; second, the diversification of fuel mix towards lower
emission fuels. Therefore, the negative impacts of EI on the CO2
emissions increase are expected to be greater during 2011e2020.
4.3. Aggregated effects of CO2 emissions change
Some important information might be left out if the influencing
factors are calculated based on time intervals. In order to avoid such
problems, we further calculate the aggregated effects of contribu-
tors to energy-related CO2 emissions change in non-metallic min-
eral products industry in China. The following calculation, which is
also based on equations from (4)e(9), uses 1986 as the base year.
Results are shown in Fig. 5.
As shown in Fig. 5, CO2 emissions change from energy con-
sumption in the Chinese non-metallic mineral products industry
increased from 13.64 Mt in 1987 to 308.48 Mt in 2010, equivalent to
a growth of 2162.40%. Since 2002, carbon dioxide emissions change
has resumed their growth at an even greater rate [26], because of
China’s accelerated process of urbanization. The urbanization pro-
cess boosted the infrastructure construction, which then promoted
the demands for cement and other building materials. Inevitably,
the growth of industrial output will result in the growth of energy
consumption and the corresponding CO2 emissions. As a result,
the average annual growth rate of CO2 emissions change during
2003e2010 was 26.28%.
The industrial activity (IA) effect was the major factor contrib-
uting to the increase in CO2 emissions change (Fig. 5). Compared
with the base year 1986, CO2 emissions increase contributed by IA
increased from 0.80 Mt in 1987 to 953.36 Mt in 2010. The average
annual growth rate of CO2 emissions increase attributed by IA was
694 B. Lin, X. Ouyang / Energy 68 (2014) 688e697
Fig. 5. Aggregated effects of contributors to energy-related CO2 emissions change in
the Chinese non-metallic mineral products industry.
121.73% during 1986e2010. Meanwhile, the major contributor to the
decline of CO2 emission change was energy intensity (EI) effect. The
negative contribution increased from 15.25 Mt in 1986 to 486.46 Mt
in 2010. The average annual growth rate of EI effect, which was
lower than that of the IA effect, was 109.22% during 1986e2010.
Although the impact was small, the substitution (S) effect
contributed to the decline of CO2 emissions change over the study
period. The small effect also illustrated that energy structure of the
Chinese non-metallic mineral products industry was still domi-
nated by coal. The effect of carbon intensity of energy (CI) showed a
varying trend in several years; however, it contributed to the
decline of CO2 emissions change overall. The decline in CO2 emis-
sions contributed by the CI effect increased from 1.42 Mt in 1987 to
49.09 Mt in 2010 compared with the base year 1986.
The effect of industrial scale (IS) was also unstable during the
study period. However, it was the third most influential factor
among variables, which was worthy of our attention. During 1987e
1997, the IS effect contributed to the increase in CO2 emissions
change expect for the year 1990. However, even though the impact
of IS effect on CO2 emissions change was negative, it was quite
small (0.94 Mt). Afterward, the IS effect contributed to the CO2
emissions decrease. The negative impacts on CO2 emissions
increased from 104.10 Mt in 1998 to 155.59 Mt in 2005, the peak of
amount of decreased CO2, and then dropped to 83.47 Mt in 2010.
The negative impacts of IS effect on the CO2 emissions increase may
due to the industrial consolidation and the elimination of backward
production capacity, which were beneficial to energy conservation
and energy use reduction.
In summary, the major contributors to CO2 emissions change in
the Chinese non-metallic mineral products industry were factors of
industrial activity (IA) and energy intensity (IE). The effect of in-
dustrial scale (IS), which varied during our study period, indicated
significant negative impacts on the CO2 emissions increase during
1998e2010. Although the impacts were quite small, the effects of
carbon intensity of energy (CI) and substitution (S) also contributed
to the decrease of CO2 emissions.
4.4. Emission reduction potential
4.4.1. Estimates of energy-related CO2 emissions
According to equation (3), CO2(0) ¼ CI(0)*S(0)*EI(0)*IA(0)*IS(0)
for the base year 2011 can be calculated If the change rates of the
CO2 emissions per unit of fossil-fuel (a), the share of fossil fuels in
total energy (b), energy consumption per unit of industrial value
added (d), industrial value added per capita (f) and the
Table 1
Hypothesis of variables (Unit: %).
Scenarios CI S EI IA IS
BAU scenario 0.49 0.32 5.22 13.62 0.29
Scenario 1 0.29 0.12 5.02 13.82 0.09
Scenario 2 0.69 0.52 5.42 13.42 0.49
employment (g) for the forecasting year are given as exogenous, the
prediction of future energy-related CO2 emissions of the Chinese
non-metallic mineral products industry can be made based on
equations (11)e(16).
In this paper, we estimate the future CO2 emissions of the Chi-
nese non-metallic mineral products industry in 2020. The year
2020 is an important time node for China, because the rapid ur-
banization and industrialization process of China is expected to
come to an end in 2020 [47]; more importantly, the modification of
both industrial structure and energy consumption structure could
be realized after 2020. In order to evaluate the degree of influence
of each factor on the future CO2 emissions, we set three scenarios to
provide a comprehensive comparison of results. Similar scenario
analysis has been applied by Ou et al. [48], IEA [49], Zhang et al. [50]
and so on and so forth.
The three scenarios are as follows: (i) BAU (business as usual)
scenario, of which the set is based on the historical development
trend of each factor. The parameters chosen for BAU in this paper
are the average growth rate of each variable (CI, S, EI, IA, IS) during
1986e2010. A BAU scenario reflects the possible variation trend
indeed; however, the purpose of a BAU scenario is not to provide
precise estimates of the specific economic conditions but to make
clarifications of the major factors that contribute to the future CO2
emissions. Moreover, it is the benchmark for setting other two
scenarios. (ii) Scenario 1, the higher-emission scenario, of which
the growth rate of each factor is two percentages higher than that
in the BAU scenario. (iii) Scenario 2, the lower-emission scenario,
of which the growth rate of each factor is two percentages lower
than that in the BAU scenario. As previously mentioned, the set of
other two scenarios are based on the BAU scenario. The advantage
of the scenario analysis is that we can have a relatively compre-
hensive analysis on the possible results of CO2 emissions, so that
different policies on energy utilization and carbon dioxide emis-
sions can be compared. Hypothesis of variables is shown in Table 1.
Based on the hypothesis above, estimates of CO2 emissions from
energy consumption in the Chinese non-metallic mineral products
industry in 2020 are shown in Fig. 6. The scenario-differentiated
growth rates of explanatory variables, which consider factors such
as the actual growth conditions, the growth promoted by urbaniza-
tion and the possible adaptations to the low-carbon development in
the Chinese non-metallic mineral products industry, are reasonable.
As shown in Fig. 6, CO2 emissions from energy consumption in
the Chinese building materials industry will keep increasing. It can
be explained by two reasons: first, industrial energy demand will
keep growing in the urbanization and industrialization stage [9,51];
second, industrial energy consumption structure will remain stable
during the rapid economic development process [7].
Under the BAU scenario, CO2 emissions from energy consump-
tion of the Chinese non-metallic mineral products industry in 2020
are predicted to be 953.22 Mt, accounting for 10.12% of China’s total
CO2 emissions.2 In addition, CO2 emissions from energy
2
The share of CO2 emissions from energy consumption of the Chinese non-
metallic mineral products industry in China’s total CO2 emissions is based on the
estimate from Lin and Liu [51], which shows that China’s CO2 emissions will reach
9.418 billion tons in 2020 under the baseline scenario.
 B. Lin, X. Ouyang / Energy 68 (2014) 688e697
Fig. 6. Actual values and estimates of energy-related CO2 emissions in the Chinese
non-metallic mineral products industry under different scenarios.
consumption will reach 1052.24 Mt and 863.35 Mt in 2020 under
scenario 1 and scenario 2, respectively.
4.4.2. Estimates of emission reduction potential
In order to estimate the future reduction potential of CO2
emissions in the Chinese non-metallic mineral products industry,
we further develop two scenarios: (i) scenario of moderate emis-
sion reduction, (ii) scenario of aggressive emission reduction. The
above set is based on three reasons: first, it will be difficult for the
Chinese non-metallic mineral products industry to reduce CO2
emissions considering the increasing demand of raw materials for
infrastructure construction; second, the extensive growth of in-
dustry must be supported by lower cost of energy; and coal is the
most competitive energy due to relative abundant reserves. How-
ever, it is the energy with the highest carbon content; third, the
reduction targets of energy intensity and carbon intensity in 2020
will promote clean energy development and energy efficiency
improvement in the industrial sector. Therefore, potentials of CO2
emissions reduction are influenced by the industrial development
as well as government policy.
Scenarios of emission reduction are set as follows: under the
scenario of moderate emission reduction, CO2 emissions of the
Chinese non-metallic mineral products industry will transform
from Scenario 1 to BAU scenario. Accordingly, under the scenario of
aggressive emission reduction, CO2 emissions of the Chinese non-
metallic mineral products industry will transform from Scenario
1 to Scenario 2. Similar set is applied by Lin and Ouyang [52]. Ac-
cording to estimates in Section 4.4.1, reduction potential of CO2
emissions is calculated and reported in Table 2.
As shown in Table 2, reduction potential of CO2 emissions in
the Chinese non-metallic mineral products industry is substan-
tial. Under the scenario of moderate emission reduction,
99.02 Mt of CO2 emissions can be reduced in 2020, which is
equivalent to the energy-related CO2 emissions of Greece in 2009
(99.83 Mt) and accounts for 0.30% of the world’s energy-related
CO2 emissions in 2011. Moreover, the corresponding share of
CO2 emissions reduction in China’s total CO2 emissions would be
1.05% in 2020.
Under the scenario of aggressive emission reduction, reduction
potential of CO2 emissions in the Chinese non-metallic mineral
products industry is predicted to be 188.88 Mt in 2020, which is
close to the energy-related CO2 emissions of Egypt in 2010
(190.59 Mt) and accounts for 0.58% of the world’s CO2 emissions
from energy consumption in 2011. In addition, the corresponding
share of CO2 emissions reduction in China’s total CO2 emissions
would be 2.01% in 2020.
695
Table 2
Reduction potential of CO2 emissions in the Chinese non-metallic mineral products
industry and its impact on China’s total CO2 emissions.
Year Scenario of moderate emission Scenario of aggressive emission
reduction reduction
CO2 emissions reduction Share CO2 emissions reduction Share
2015 35.22 N.A. 68.82 N.A.
2020 99.02 1.05 188.88 2.01
Note: N.A. stands for not available.
5. Conclusions and policy suggestions
This article assesses the CO2 emissions change from energy
consumption in the Chinese non-metallic mineral products in-
dustry based on the application of Logarithmic Mean Divisia Index
(LMDI) method. The results show that industrial activity (IA) effect
was the leading force for the increase of CO2 emissions while en-
ergy intensity (EI) effect was the major contributor for the CO2
emissions decrease, which is in agreement with [53e55]. It was
observed that fuel diversification (S) effect and carbon intensity of
energy (CI) are amongst the factors that contributed to the decline
of CO2 emissions. Industrial scale (IS) effect presented a varying
weight interchanging intervals of growth.
To the best of our knowledge, this study is evaluated for the first
time in the field of CO2 emissions change from energy consumption
in the Chinese non-metallic mineral products industry. Results in
this article offer complementary perspectives on determinants of
energy-related CO2 emissions change and help to formulate miti-
gation strategies for CO2 emissions [56] in industrial sectors in
China. Results demonstrate that reduction potentials of CO2 emis-
sions are 99.02 Mt and 188.88 Mt in 2020 under the scenarios of
moderate and aggressive emission reduction, respectively, which
correspondingly account for 0.30% and 0.58% of the world’s energy-
related CO2 emissions in 2011.
Measures for CO2 emissions reduction are suggested as follows:
Energy conservation should be the major strategy for reducing
energy intensity [57]. Compared to energy structural adjustment,
energy conservation is a cheaper and more feasible way to reduce
energy consumption in industrial sectors. For the Chinese non-
metallic mineral products industry, energy conservation could be
achieved by several measures: first, adjusting the product structure
by reducing the production of high energy-consuming products;
second, closing down backward production capacities; third,
substituting energy with capital investment (i.e., upgrading new
equipment) in the production process. EMC (Energy management
contracting), which has been widely adopted in industrial energy
conservation and is quite popular in developed countries, is also an
important way to improve energy utilization efficiency. The gov-
ernment should promote the EMC in China’s industrial sectors by
overcoming systematical obstacles, such as the recognition of en-
ergy service corporations and the financing of energy-saving
management. Furthermore, the government could encourage in-
vestment on energy saving technology by providing tax exemp-
tions and preferential loans [58].
Energy pricing reform is a long-term strategy for CO2 emissions
reduction. Fuel diversification and cleaner energy structure are
effective ways to constrain the increase of CO2 emissions. In order
to modify the coal-dominated energy structure, the consumption of
coal and other fossil fuels must be replaced by cleaner energy.
However, industrial sectors will have little incentives to adjust their
energy structures if the government kept subsidizing the con-
sumption of fossil fuels. Only if the true costs of fossil fuels are
reflected in energy prices, the renewable energy will be competi-
tive. Moreover, the Chinese government should further promote
696 B. Lin, X. Ouyang / Energy 68 (2014) 688e697
the reform of electricity pricing because most renewable energies
are used for power generation. Considering the environmental
advantages and positive externalities [59], increasing the subsidy
for renewable energy is also a common scheme used by many
countries in solving the high-cost problem of renewable energy. To
summarize, energy pricing reform is the essential method to
reduce CO2 emissions, which can also effectively reduce the
rebound effect of energy consumption due to energy efficiency
improvement [60]. Experiences from developed countries
demonstrate that market-orientated methods for energy conser-
vation and emission reduction are more effective than government
interventions [61,62].
Acknowledgments
The authors appreciate the editor and two anonymous reviewers
for their invaluable and constructive comments. The paper is sup-
ported by Newhuadu Business School Research Fund, Ministry of
Education Foundation (Funding no. 10JZD0018), Basic Research
Universities Special Foundation (Funding no. 2010221051), Ministry
of Education Foundation (Funding no. 10JBG013), and National
Social Science Foundation (Funding no. 09&ZD050).
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