A physical input-output method to track energy flows from extraction to services

The focus of much energy analysis in recent decades has been climate change and embodied carbon. However, we do not emit carbon for its own sake; we want the services provided by energy consumption, such as passenger... [ view full abstract ]

The focus of much energy analysis in recent decades has been climate change and embodied carbon. However, we do not emit carbon for its own sake; we want the services provided by energy consumption, such as passenger kilometers, freight kilometers, and heated space. But how are energy services (which are in non-energy units) to be included in energy analysis without losing focus on climate issues? This methods paper proposes a novel use of a physical input-output table (PIOT) to track energy flows through economies at four stages: primary (e.g., crude oil), final (e.g., refined petroleum), useful (mechanical drive), and services (passenger kilometers).

Our starting point is International Energy Agency energy accounts, which include flows of energy at the primary and final stages, including energy transformation processes and energy sector own use. We extend to the useful stage with final-to-useful conversion efficiencies. Each energy stage is quantified in energy units (TJ or ktoe). Useful energy is converted to energy services by passive devices that dissipate all useful energy in the provision of its service. Examples include (a) automobiles that convert mechanical drive into heat while providing passenger-kilometers to commuters and (b) buildings that dissipate heat to provide heated space (in units of m³-K) to occupants.

PIOTs in the “make-use” format, wherein industries are energy conversion machines and commodities are energy types or services, provide an excellent organizational structure for this data, and meaningful energy interpretations are possible. For example, all of the following can be obtained from the IO matrices: the energy efficiency of energy conversion machines (efficiency from the machine perspective), the efficiency of providing each energy type or service to society (efficiency from the commodity perspective), and the energy return on investment (EROI) of all primary energy production processes. We show that value added is positive for primary energy production, because of the free gifts of nature. If waste heat is excluded from the matrices, we show that value added is negative for all energy conversion devices and is equivalent to waste generated by and energy losses within those machines. If energy is quantified as exergy and wastes are included in the make-use tables, value added is equivalent to second-law losses, i.e., exergy destruction. Inclusion of energy services leads to mixed-units IO matrices from which the primary energy intensities of energy services can be obtained.

This method has several key advantages over previous energy analysis and IO techniques. First, it shares the typical PIOT advantage of removing prices from IO analysis. Second, it can account for the energy cost of energy services associated with imported and exported primary energy, via a multi-region PIOT analysis, something impossible with non-IO methods. Finally, it can be used for “what-if” scenarios by applying different final energy, useful energy, or energy services demand vectors to total requirements matrices. To illustrate the proposed method and its features, we present a toy example, loosely based on the UK economy.