A1 Refereed original research article in a scientific journal
Micro-level structural change decomposition of carbon productivity : Application to electricity generation in Finland
Authors: Kuosmanen, Natalia; Kuosmanen, Timo; Maczulskij, Terhi
Publisher: Elsevier
Publishing place: NEW YORK
Publication year: 2025
Journal: Environmental Impact Assessment Review
Journal name in source: Environmental Impact Assessment Review
Journal acronym: ENVIRON IMPACT ASSES
Article number: 107877
Volume: 113
Number of pages: 10
ISSN: 0195-9255
eISSN: 1873-6432
DOI: https://doi.org/10.1016/j.eiar.2025.107877
Web address : https://doi.org/10.1016/j.eiar.2025.107877
Self-archived copy’s web address: https://research.utu.fi/converis/portal/detail/Publication/485225954
The transition to renewable energy can lead to major structural changes within the energy sector: climate policies encourage the entry of cleaner producers while at the same time driving polluting firms out of the market. However, previous macro-level structural decompositions of carbon intensity and carbon productivity fail to capture the underlying micro-level dynamics, such as firm entry and exit, industry switching, and the reallocation of emissions between firms. The purpose of this study is to fill this gap by presenting a novel micro-level structural change decomposition of carbon productivity. Using comprehensive firm-level register data of the greenhouse gas emissions in the Finnish electricity generation industry in 2000-2019, we find that more efficient allocation of carbon emissions across firms was the main driver of carbon productivity growth in Finnish electricity generation during the study period. We also find that structural change, especially the entry of new firms, played a significant role in the carbon productivity development of this industry.
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