Factors affecting energy intensity in the Turkish manufacturing industry

This study investigates factors impacting the level of energy intensity in the Turkish manufacturing industry for the period 2006-2012. To this end, 26 regression models were constructed to analyze relationship among various variables. These regression models were subgrouped under 8 following catogories; (i) the relationship between firm size and energy intensity, (ii) how the level of energy intensity changes in sub-sectors, (iii) the relationship between firm age and energy intensity, (iv) as to whether energy intensity changes based on geographic regions, (v) whether the capital ownership alters the level of energy intensity, (vi) the link between R&D and energy intensity, (vii) the relationship between exports and energy intensity, and (viii) how energy intensity changes with an inclusion of all aforementioned variables. These regression models have been estimated via polled ordinary least squares. Empirical findings point out that the several variables are statistically significant to estimate the energy intensity. Yet, the most important factor impacting energy intensity is the scale of firm. Hence this result shows that policy makers should focus on scale of firm in order to lower energy intensity. Keywords: Energy Intensity, Manufacturing Industry, Pooled Ordinary Least Squares, Energy Regulation, Turkey