Drivers of Change in Energy-Related CO2 Emissions in U.S. Manufacturing: an LMDI Decomposition Analysis (2002–2022)

This study decomposes change in energy-related CO₂ emissions from U.S. manufacturing between 2002 and 2022. During this time, manufacturing output rose by 83%, while emissions fell by 21%. We break down this change into five drivers: activity, structure, efficiency, energy mix, and CO₂ intensity. The analysis extends to 5 time intervals and 18 manufacturing subsectors. Increase in activity and shift to energy-intensive manufacturing increased CO₂ emissions, while improved efficiency, cleaner fuels, and lower carbon intensity reduced them. The largest emission cuts occurred in 2006–10, followed by 2010–14 and 2002–06, showing a slowdown in recent years. Petroleum and coal, chemical products, and primary metals contributed 257 MmtCO₂ of the total 426 MmtCO₂ reduction. The findings show that economic growth of a sector often aligns with improvement in energy efficiency. As efficiency gains slow, further emission cuts will require electrification and grid decarbonization.