Definition:
This indicator is defined as the ratio between CO2 emissions from fuel combustion and the value added of associated economic activities. It can be calculated either for the whole economy (GDP) or for particular sectors such as manufacturing (manufacturing value added).
CO2 emissions per unit of GDP is expressed in kilogrammes of CO2 per USD (in constant prices).
Concepts:
Gross value added is a productivity metric that measures contributions to the economy. It is calculated using the system of national accounts (SNA 2008) as the sum of all employee compensation, gross operating surplus of government and corporations, gross mixed income of unincorporated enterprises and taxes, minus any subsidies on production and imports, except for net taxes on products.
CO2 emissions for an economy are estimated based on energy consumption data for all sectors. For the manufacturing sector, the following subsectors are considered beyond the total manufacturing sector (energy used for transport by industry is reported under transport):
(1) Iron and steel industry [ISIC Group 241 and Class 2431];
(2) Chemical and petrochemical industry [ISIC Divisions 20 and 21] excluding petrochemical feedstocks;
(3) Non-ferrous metals basic industries [ISIC Group 242 and Class 2432];
(4) Non-metallic minerals such as glass, ceramic, cement, etc. [ISIC Division 23];
(5) Transport equipment [ISIC Divisions 29 and 30];
(6) Machinery comprises fabricated metal products, machinery and equipment other than transport equipment [ISIC Divisions 25 to 28];
(7) Food and tobacco [ISIC Divisions 10 to 12];
(8) Paper, pulp and printing [ISIC Divisions 17 and 18];
(9) Wood and wood products (other than pulp and paper) [ISIC Division 16];
(10) Textile and leather [ISIC Divisions 13 to 15]; and
(11) Non-specified (any manufacturing industry not included above) [ISIC Divisions 22, 31 and 32]
Rationale and Interpretation:
This indicator measures the amount of CO2 emissions from fuel consumption produced by an economic activity, per unit of economic output. When computed for the whole economy, it is a measure of the combines effects of: (1) the average carbon intensity of the energy mix (linked to the shares of the various fossil fuels in the total); (2) the structure of an economy (linked to the relative weight of more or less energy-intensive sectors); and (3) of the average efficiency in the use of energy.
When computed for the manufacturing sector (CO2 emissions per unit MVA), it measures the combined effect of: (1) the carbon intensity of the manufacturing economic output (average carbon intensity of energy mix used); (2) the structure of the manufacturing sector (the energy efficiency of production technologies in each sub-sector); and (3) the economic value of the various output.
Manufacturing industries are generally improving their emission intensity as countries move to higher levels of industrialization, but it should be noted that emission intensities can also be reduced through structural changes and product diversification in manufacturing. Lower values of CO2 per unit MVA could be interpreted as more efficient manufacturing structures.
CO2 emissions account for roughly 80% of all greenhouse gas emissions from the manufacturing processes.
