Evaluating the energy footprint of Yazd Province: A regional input–output analysis approach

Economic growth and development require greater use of human, physical, and natural resources to increase production and per-capita income. In fact, environmental degradation has been the primary product of man’s efforts to secure improved standards of living for the growing number of people. The extent of environmental degradation is linked to human population size and the quantity of natural resources available per person. Rapid population growth, intensification of agriculture, uncontrolled growth of urbanization, and industrialization play important roles in resource depletion, waste production and environmental degradation. The increasing population and growing affluence have resulted in rapid growth of energy production and consumption and, thus, the environmental effects like ground water and surface water contamination, air pollution and global warming. All of them are of growing concern due to the increasing levels of consumption. The many problems that are now evident emphasize the urgent need to reassess the status of environmental resources. Based on the evidence, definitive plans must be developed to improve environmental management now and for the future.
The importance of non-renewable energy is not only because energy is an input of production and its consumption facilitates the production but also because it is a major source of carbon emission, leading to environmental degradation. In fact, the increased use of energy, especially from carbon-related sources, is associated with a rising level of carbon emission, which is harmful to environment and human health. Then, one of the major problems of mankind is to combine the energy consumption and to have respect for environment. The present paper is an attempt to study the effects of increased production on energy consumption and the energy content of goods and services of different economic sectors in Yazd Province. Therefore, the energy footprint index is briefly introduced and, according to the theoretical framework, the fossil energy contents of the economic sectors in the province are calculated for 2011.

Considering that the main objective of the present study is to assess and calculate the use of energy in different economic sectors of Yazd Province and since there are interrelationships between economic activities and energy consumption, we use the energy footprint indexes for domestic and foreign trade, i.e., exports and imports, and a regional input-output model to calculate the energy contents of goods and services of various economic sectors in the province. To this end, in the present study, the Industry-Specific FLQ (SFLQ) method is used based on the national input-output table of 2011 to compute the input-output table of Yazd Province in 20 sectors defined by the Statistical Center of Iran.

Information on the domestic energy footprint at the level of economic sectors in Yazd Province shows that the sectors "Other services", "Manufacture of fabricated metal products except machinery and equipment" and "Other food, beverage and tobacco" have the highest share of the fossil energy content in the final domestic demand of the province. Also, the study of the content of fossil energy in the export of goods and services shows that, in 2011, the amount of fossil energy exported through goods and services out of the province was 699,979,025 tons. The findings indicate that the "other services" and "manufacturing of metal fabricated products except machinery and equipment" sectors have the most traces of the export energy. Also, some sectors, such as "construction" and "transportation", have a small share in the export energy footprint due to their export value and low increasing coefficients. From the sum of the values of each section in the matrix of the energy footprint for imported intermediate and final goods, 20% of the total energy footprint of the imported goods and services is related to the final import energy footprint, and the remaining share belongs to the intermediate import energy footprint. The "building" and "transportation" sectors have the highest fossil energy content, respectively. The sections "Manufacture, repair and installation of computer products and manufacture and repair of electrical appliances" are in the last ranks due to their lower import values and lower energy increasing coefficients. Finally, the trade balance of energy footprint was calculated, which showed a difference between the exports and imports of virtual energy at the level of economic sectors. Although comparative and competitive advantages should be considered in exports and imports, the importance of virtual energy in competitive advantages has been ignored in the country. Therefore, virtual energy should be considered in the production of goods and services to get their competitive advantages known to the outside world. The findings indicate that Yazd Province is an importer of net fossil fuels. In other words, only seven sectors have a trade surplus of fossil energy content.

Despite the special importance of energy content (energy footprint), the number of national studies conducted in this field is very small. The energy footprint index at the macro level is less accurate than its measurement at the sectoral level. The results of the research indicate that Yazd Province is a net importer of net fossil fuels. In other words, only seven sections including "crude oil, natural gas and other mines", "other food, beverage and tobacco products", "manufacture of rubber and plastic products", "manufacture of non-metallic mineral products", "manufacture of fabricated metal products except machinery and equipment", "manufacture, repair and installation of subsidized products and manufacture and repair of electrical appliances", and "other services" have a positive energy footprint trade balance. The findings related to the trade deficit of fossil energy contents in most economic sectors of the province indicate that the industrial and production activities over there are at a low level. In other words, the trade deficit of the province proves that the structure of the province's economy depends on the outside world.