Abstract
Energy is a vital input in achieving rapid economic growth in India and therefore in each of its states. Key policies such as ‘Make in India’ and ‘Smart Cities Mission’ are expected to only contribute to a rapid increase in energy consumption in most Indian States. Yet, India is also committed to reducing its greenhouse gas emissions. Hence, it needs to adopt policies that would achieve growth and, at the same time, reduce carbon emissions. Manufacturing is a significant component of the engine that spurs economic growth, and it is a major consumer of energy. This study aims to identify the core factors that have influenced energy consumption by the manufacturing industries of five eastern states (Bihar, Chhattisgarh, Jharkhand, Odisha, and West Bengal) of India in the period 2010–11 to 2014–15 and also intends to make an interstate comparison of energy consumption. We conduct an index decomposition analysis, more specifically the log mean Divisia index, to identify key factors behind the increase in energy consumption. The findings of the study suggest that besides energy intensity, ‘level of activity’ is a major contributing factor. The findings also indicate that there remains a lot of scope for improving energy-related policies with regard to the manufacturing industries of eastern India.
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Notes
- 1.
Available up to 2014–15.
- 2.
Methods used by Jenne and Cattell, Marlay, Reitler et al., Howarth et al., Park, Sun and Ang et al. are discussed in Ang (2004).
- 3.
NIC is the counterpart of the International Standard Industry Classification (ISIC) for India; the manufacturing sector of India has been classified into various 2-digit, 3-digit, and 4-digit industry groups.
- 4.
The compound annual growth rate is calculated by taking the nth root of the total percentage growth rate, where n is the number of years in the period being considered. This can be written as CAGR = (End Value/Start Value)(1/No of years)−1.
- 5.
According to conventional definition, a country’s energy intensity is usually defined as energy consumption per unit of gross domestic product (GDP).
- 6.
The energy intensity has been calculated based on the data of average fuel consumed and value of output for the study period (2010–11 to 2014–15).
- 7.
MT = Million Tons.
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Ghosh, G., Dutta, M. (2018). Patterns of Energy Consumption in Manufacturing: Looking at the Eastern States of India. In: Gautam, A., De, S., Dhar, A., Gupta, J., Pandey, A. (eds) Sustainable Energy and Transportation . Energy, Environment, and Sustainability. Springer, Singapore. https://doi.org/10.1007/978-981-10-7509-4_15
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