Electricity consumption and economic growth nexus in Beijing: A causal analysis of quarterly sectoral data

• Published in: Renewable & sustainable energy reviews 2018-02, Vol.82, p.2498-2503
• Main Authors: Liu, Da, Ruan, Liang, Liu, Jinchen, Huan, Huang, Zhang, Guowei, Feng, Yi, Li, Ying
• Format: Article
• Language: English
• Subjects: Cross-sector analysis; Economic growth; Electricity consumption; Granger causality test; Sectoral analysis
• ISSN: 1364-0321; 1879-0690
• DOI: 10.1016/j.rser.2017.09.016

Traditional energy-economy nexus analysis is limited to aggregated and annual data because more detailed energy consumption data are usually not available. However, probing the disaggregated sectoral data usually provides a deep insight of energy-economy nexus at sectoral level, which is vital for governments to make proper policies in a timely manner. This paper developed a deep research to find detailed quarterly and sectoral nexus between electricity consumption and economic growth. Sectoral data of electricity consumption and economic growth from 2005Q1 to 2016Q3 in Beijing were exploited to model with Granger causality analysis. The results show that at the aggregated level there is a unidirectional causality running from economic growth to electricity consumption. At sectoral level, for the primary sector the electricity consumption impacts its added value with two quarter lagged; for the secondary sector and the tertiary sector, there is a unidirectional causality running from economic growth to electricity consumption. At cross-sector level, the economic growth of the secondary sector has no impact on that of the tertiary sector, while the economic growth of the tertiary sector strongly affects that of the secondary sector. In terms of energy saving and emission reduction, different policies should be employed in the three sectors. Beijing should encourage the electrification of the primary sector to stimulate its development; Beijing should make more efforts on tertiary sector to reduce electricity consumption however these policies should be more prudent. While for the secondary sector, improving energy efficiency and technological innovation should be paid more attention to.