Key subsectors identification and industrial restructuring analysis of carbon emissions in the industrial sector: Evidence from the LMDI method

This study explored how to identify key subsectors that need to control carbon emissions in the industrial detailed sectors, and how industrial restructuring can reduce them. Taking Changxing County, China, as an example, we used the Logarithmic Mean Divisia Index (LMDI) method to identify sectors that need to focus on controlling industrial carbon emissions, namely carbon-emission-dominant industries (DI), non-carbon-emission-dominant industries (non-DI), and high-tech industries, from a new perspective. Then, we analyzed the main drivers of the carbon emission changes in each sector and the specific contribution of each driver, as well as industrial carbon reduction performance under different industrial restructuring directions. The results showed that: (1) Changxing County has five carbon emission-dominant industries represented by the manufacture of non-metallic mineral products, electric power, and heat supply. (2) The drivers of each industrial sector differ significantly, and reducing the energy intensity of the electric power and heat supply is a more effective means of carbon reduction in Changxing. (3) The industrial restructuring from DI to the high-tech industry helped to reduce carbon emissions of Changxing significantly, and the industrial restructuring from the high-tech industry to the DI promoted carbon emissions. In summary, we believe that the key to achieving emission reduction through industrial restructuring is to identify and control emission-leading sectors, rather than economic-leading sectors. This paper provides a strong reference for formulating industrial carbon reduction policies with the goal of a "list of polluting industries" and evaluating the carbon reduction performance under different industrial restructuring directions.