Energy intensity convergence

In climate change discussions, energy intensity is the amount of energy required to produce a dollars worth of GDP.  While there are big differences in energy intensity around the world.  Generally poor countries are more energy intensive than rich, and the US, Canada and Australia are more energy intensive than Europe and Japan.  A recent graph from the Economist illustrates how energy intensities are falling and converging, unfortunately at a slower rate than economic growth, meaning that energy use, and hence CO2 emissions, continue to grow.

From the Economist:

2 thoughts on “Energy intensity convergence”

  1. Interesting graph, that raises a few questions.

    1. Why measure against total GDP and not financial sector cleaned real productive GDP? As an example, the US market has become increasingly financialized since the 1980’s: GDP grows, but energy consumption per capita grows too, just much slower.

    2. Does it account for energy imports (no it does not)? A lot of the energy consumption in USA since 1980s has come from grey energy imports (up to 25% – 30%, See Peter Terzakian’s ‘1000 barrels a second’). Again, this can mislead the numbers.

    3. What is the 2009 level inflation correction mechanism used? If standard CPI excluding food & energy, then the numbers are skewed again.

    However, the most obvious question is:

    If energy consumption per capita as a % of GDP is the only problem, then we can avoid the energy crisis, by nationalizing everything and raising hourly wages for everyone by controlling prices. This will show up as increased GDP, no inflation, so the amount of relative energy consumption starts to go down.

    That’s the theory anyway, in case one happens to believe in it 🙂

  2. 1. Don’t totally understand your point. Depends on why you are making graph.
    2. No – if I understand you. It counts all energy used.
    3. See graph adjusted for purchasing power.

    and I don’t understand you final point. It would crash Purchasing power and probably increase energy/unit PP adjusted GDP.

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