Exploring the direct rebound effect of energy consumption: a case study

Abstract

Technological innovation plays a crucial role for improving energy efficiency. But the excessive energy consumption has presented a significant challenge at the same time, which indicates that the direct energy rebound effect exists in China. Cobb-Douglas production function and Logarithmic Mean Divisia Index decomposition model are employed to analyze the rebound effect of energy consumption of all three main industries sector in China. The results show that total technological effect curve and total substitution effect curve fluctuated more significantly than total structure effect curve from 1991 to 2014.The first two curves were the most critical factors for the energy consumption intensity. Stabilizing energy prices, developing new and renewable energy and implementing policies related to energy conservation and emission reduction are effective measures to reduce energy consumption intensity. More attention should be paid to the growing demand for living energy consumption derived from the rapid development of the tertiary industry. The direct rebound effect of energy consumption in China showed an overall descending trend. This shows that technological effect has well prevented the growth of energy consumption. Direct energy rebound effect can be controlled effectively by means of formulating and implementing the corresponding energy related policies.