Korean Energy Economic Review ISSN:1599-7057(Print) 에너지경제연구

The purpose of this paper is to analyze comparatively for energy intensity in industrial sector(agriculture, forestry and fisheries, manufacturing, service industries and other industries including mining, construction) of the two countries, Japan and Korea through LMDI decomposition methodology over the past 19 years(1990-2009). The energy consumption was decomposed into 3 factors such as activity effect, structure effect, intensity effect. The increase of the energy consumption was due to activity effect for both countries. Structure effect and intensity effect had a role in reducing energy consumption in both countries, but the intensity effect was greater than the structure effect in Korea, whereas the the structure effect was greater than the intensity effect in Japan. The industrial restructuring along with energy saving policies are needed in order to address the future energy security and climate change.