Regional Energy Transition: Decoupling CO2 Emissions and Policy Perspectives

This study examines the relationship between energy consumption and energy-related CO2 emissions for a sample of 79 reporting entities, grouped into seven regions, over the period 2013–2023. The methodology uses three empirical tools: (i) Tapio elasticity to classify types of decoupling; (ii) Kaya–LMDI decomposition to identify factors that determine emissions; and (iii) a log-difference panel model to separate year- and country-specific effects. The results indicate a reduction in carbon intensity in all regions, more pronounced in Europe and North America. According to the Tapio classification, Europe is in recessive decoupling, the Middle East is on the verge of expansive decoupling, North and South America are in strong expansive decoupling, and Asia Pacific, Africa, and CIS show only weak signals of expansive decoupling. The LMDI results show that, in regions with strong decoupling, the decrease in carbon intensity contributes to reducing emissions. In those with weak decoupling, the effects are partially canceled out by population growth and energy demand. Finally, the fixed-effects panel model does not identify any structural decoupling at the regional level. Overall, this study contributes to the literature by separating long-term structural effects from annual fluctuations. On this basis, we provide clear guidelines for designing regional energy policies.