Factors effect sectoral energy consumption in Turkey and alternative energy policies

This paper aims to investigate the sectoral (service, agriculture and industry) energy use in Turkish economy for the 1970?2009 period. Also industry sector has been analysed by divided into eight sub-sector (cement, sugar, fertilizer, iron and steel, petrochemical feedstock, chemistry and petrochemicals, nonferrous metals and rest of manufacturing industry) for the period of 1980?2009. Decomposition analyisis is conducted on these sectors by using aditive version of LMDI method due to its advantages over others. The results indicate that, while the primary energy consumption of three main sector has been increased as a result of production and structral effect but decrased as for intensity effect. Also production effect have strong influence on primary energy consumption in accordence with other two effects. It has been clearly seen that sectoral energy consumption increase with production closely. Rise in primary energy consumption during 1970?2009 period was mostly due to rise in production. Except for economic crisis, increase in production lead to increase in primary energy consumption. Similarly, structure effect hes been came to conclusion as positive corelation with primary energy consumption because of rise in relative share of energy-dense industry sector in national income. When we talk about intensity effect, it shows that after 1980 period, market oriented economic policy, efficient energy management technics and utilization from energy efficieny applications have been more promoted. Also it has been stated that socio-economic improvements, technological changes and advancements in production systems have impacted inversly direction in primary energy consumption. After 1980 period, there was rapid growth in demand for energy in Turkey, led by strong growth in indsutrial activity and increase in penetrations of electrical equipment, space cooling and other electrical appliances in both the industrial and residental sectors.There have been also some colclusions about industry sub sectoral basis. We have seen that prodcution and intensity effect leads to increase in energy consumption but as for structural effect, it leads to decline in industrial energy consumption. In similar vein production effect contributed more to increase in industrial energy consumption than other two effects. Simply put, increase in industrial production leads to increase in industrial energy consumption. Secondly intensity effect shows two main tendency after 1980 period. Between 1980-2000 it has negative value. It means that energy dependent production way has not been kept it?s tendency after 1980 period. In conjunction with export oriented liberal economic policies, increase in technological progress, competitveness, energy efficiency and eficient energy management retarted primary energy consumption by intensity effect. But after 2000 period, increase in energy intensity is explained by negative technological progress, insufficient application of energy conversation policies, inefficient energy management technics, over industrialization tendency, stabilization of energy prices at low level for the period of 1980-2007. Also after 2000 period, there was a rapid growth in energy demand for energy in Turkey, led by strong growth in industrial activity and increase in penetrations of electrical equipment, space cooling and other electrical appliances in both industrial and residental sector.Finally negative direction of structrual effect in industrial energy consumption could be explained by increase in share of energy dense subsector like cement and iron-steel in total manufacturing production. In the view of such conclusions, energy policies for Turkish economy firstly put emphasis on security. Secondly energy policy should reduce energy cost. Decrease in energy cost means increse in competitive power of Turkish economy. In addition to these policies, share of clean and renewable energy sources in primary energy consumption should be rise and policies make available to enough diversification of energy resources to avoid any adverse effect of energy cut.