19-21 June 2017 40th IAEE Conference Singapore Input-Output and Structural Decomposition Analysis of Singapore’s Carbon Emissions Su Bin, Ang B.W., Li Yingzhu (Email: subin@nus.edu.sg) Energy Studies Institute National University of Singapore 1

Outline Introduction Methodology Input-Output Analysis Structural Decomposition Analysis Case Study of Singapore’s Carbon Emissions Singapore’s Embodied Emissions by Sector Singapore’s Embodied Emissions by Final Demand Singapore Household related Carbon Emissions by Income Groups Driving Forces to Singapore’s Embodiment Changes Driving Forces to Singapore’s Household-related Emission Changes Discussion and Conclusions

1. Introduction Climate Change and COP-21 in Paris Singapore as an island-state with no natural resources Singapore’s energy supply fully relies on imports, and lack of alternative energy resource Energy Efficiency is a practical and cost-effective means of mitigating CO2 while sustaining economic growth Mitigation Targets: Reduce emissions to 7-11% or 16% (if there is a legally binding global agreement on climate change) below BAU level by 2020; Reduce emissions intensity by 36% from 2005 levels by 2030, and stabilise its emissions with the aim of peaking around 2030 (INDC submitted on July 2015).

Singapore’s National Circumstances Urban city-state of just 718.3km² Population: 5.35 million in 2015 GDP: S$402.5 billion in 2015 Per capita GDP: S$75,234 International Trade: S$884.1 billion Contribution to 0.11% of global emissions

Singapore’s Social-Economic-Emission Indicators Year Population (Thousand) GDP (Million SGD at 2005 Market Prices) Carbon Emissions (kt-CO2) Industry Household Total 2000 4,028 165,245 33,291 4,465 37,756 2010 5,077 284,561 40,934 3,454 44,388

2. Methodology Input-Output Analysis To find out the embodied carbon emissions in different final demand categories and detailed sectoral level Data treatment: How to match the I-O and energy/emission data? (Su et al., 2010) Model assumption: What are the I-O model assumptions used? (Su and Ang, 2013) Structural Decomposition Analysis To find out the driving forces (e.g. energy/emission efficiency and inputs/demand structure) to the change of embodied and total carbon emissions over time Decomposition framework: How many factors to be considered? (Su and Ang, 2012) Decomposition technique: Which technique is more appropriate? (Su and Ang, 2012)

Input-Output Analysis (Su et al., 2010; Su and Ang, 2013) Non-competitive Imports Assumption Private Consumption Government Consumption Gross Fixed Capital Formation Change in Inventory International Exports Embodied Carbon Emissions in

Household related Carbon Emissions (Direct + Indirect) Direct Emissions by HH-G1 Indirect Emissions by HH-G1 Direct Emissions by HH-Gm Indirect Emissions by HH-Gm Household related Carbon Emissions

Structural Decomposition Analysis (Su and Ang, 2012) D&L (SDA) or S/S (IDA) Method Emission Coefficient Energy Mix Energy Intensity Leontief Structure Effect Final Demand Structure Effect Total Final Demand Effect Emission Intensity Effect Embodied Emission Changes Remarks: ● means the five final demand categories, including pc, gc, gfcf, ci and ex.

Decomposition of Household related Carbon Emissions Emission Intensity Effect Leontief Structure Effect Final Demand Structure Effect Per Capita Final Demand Population Total Final Demand Effect Household related Emission Changes

3. Case Study of Singapore’s Carbon Emissions Data Sources: Singapore IO Tables 2000 (152 sectors) and 2010 (127 sectors) with 110 sectors Yearbooks of Statistics Singapore Energy Statistics from Various Sources Reports on Household Expenditure Survey (HES) Source Monthly HH-G1 (1st-20th) HH-G2 (21st-40th) HH-G3 (41st-60th) HH-G4 (61st-80th) HH-G5 (81st-100th) National Average HES 2002-03 Expenditure 1,704 2,460 3,178 4,067 5,351 3,352 Income 1,229 3,060 4,759 7,286 14,558 6,179 HES 2012-13 2,231 3,536 4,699 5,590 7,568 4,724 2,022 5,299 8,378 12,270 24,544 10,503

Singapore’s Embodied Emissions by Sector

Singapore’s Embodied Emissions by Final Demand

Singapore’s Embodiment in Exports for Top-10 I-O Sectors

Singapore Household related Carbon Emissions by Income Groups

Driving Factors to Embodied Emission Changes intensity Leontief structure Final demand structure Total final demand

Breakdown of the Emission Intensity Effect

Driving Factors to Household-related Direct Emission Changes intensity Final demand structure Per capita final demand Population

Driving Factors to Household-related Indirect Emission Changes intensity Leontief structure Final demand structure Per capita final demand Population

4. Discussion and Conclusions This study presents Singapore’s embodied emissions in 2000&2010 and its driving forces to the embodiment changes happened. Exports accounted for nearly two-thirds of Singapore’s total emissions and growth in its emissions in the last decade was largely export-driven. Emissions increased as export-oriented industries and export volume expanded, whole fuel switch and energy efficiency helped to lower growth in emissions. Household-related emissions accounted for about a quarter of Singapore’s total emissions. The emissions related to different household groups remained stable as increases in embodied (indirect) emissions were offset by decreases in direct emissions. The high-income HH group registered the largest increase in direct emissions, while the middle-income HH group registered the largest increase in embodied (indirect) emissions.

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