This study investigated the driving factors of embodied carbon emission changes in manufacturing trades through structural decomposition analysis. For empirical analysis, we developed an environmental multiregional input–output model for Korea, Japan, and China for 1995–2009. The three countries, which are economically and environmentally significant in Asia, are not only tightly linked economically through global value chains, but also close geographically, sharing various environmental issues. The results show that China is a net exporter of embodied carbon emissions to Japan and Korea, despite a substantial trade deficit. Its exports are more carbon-intensive than its imports from Japan and Korea. China’s embodied emissions were mainly affected by a change in carbon-intensive production and trade structure, and Japan’s and Korea’s were affected by China’s final demand. At the sectoral level, “Electrical and Optical Equipment”, “Basic Metals and Fabricated Metal”, and “Textiles and Textile Products” mainly affected the embodied carbon emission changes in these three countries. As a result, a considerable share of carbon-intensive production has shifted to China and increased consumption of China’s final products and services in the manufacturing industries, resulting in a significant increase in embodied carbon emissions. Additionally, our findings at the sectoral level could provide important evidence regarding the effective environmental policies that enable sustainable industries. With the increasing interest in the embodied carbon emissions, future research would pay more attention to the bilateral trades of major carbon-emitting countries and multilateral trades.

Energy arguably plays a vital role in a country's economic development, and many studies have attempted to test the causality between energy and economic growth. However, no consensus has emerged yet. In the developing world, including Indonesia, the provision for greater access to energy has been suggested by some to help their economies grow and improve the lives of the poor. This study investigates the relationship between energy consumption and economic output (gross domestic product, GDP) by applying an economic method called the vector error correction of pairwise Granger causality model. The tests reveal that no directional flow exists from GDP to energy consumption; we also find no causal relationship between GDP and energy consumption in Indonesia in the long run, although a relationship exists in the short run. However, our tests indicate the presence of a strong statistical relationship between GDP and energy consumption in Indonesia. This finding indicates that there is a possibility for reducing the energy requirement for a certain quantity of GDP without raising the use of other inputs. This implies that energy conservation is a feasible policy tool to reduce production costs and render the Indonesian economy more competitive.

In this study, the economic feasibility of an Energy Storage System (ESS) was conducted to examine the effects of a tariff system for the promotion of ESS. The results are summarized as follows. First, if it were not for the tariff system for ESS, none of the contract types could secure the economic feasibility of ESS, Second, in terms of the B/C ratio, the base tariff discount was 18 times more effective than the ESS charging rate discount. Third, in the case of the Industrial (KAPII), Commercial (UL) and Educational (UL) contract types, which are available only for the charging rate discount, the economic feasibility was not secured. Fourth, in the case of Industrial (UL) and Commercial (UL) contract types, which are available for both the base tariff and charging rate discount, the economic feasibility was secured. Based on economic feasibility analysis, the combinations of the required discount on either the charging rate, base tariff, or on both for NPV = 0 were also analyzed. With this result, a modification of the current tariff system for the promotion of ESS was suggested.

This study estimated the induced effects of LNG, mega PV (photovoltaic), small PV, onshore wind and offshore wind power, which will be used as major power sources under the Korea’s energy transition policy. The 2015 Input–Output Statistics of Bank of Korea were used to reflect Korea’s economic structure. The MCI (manufacture, construction and installation) and O&M (operation and maintenance) of each power source would have different effects, so in the analysis the MCI and O&M of each power source were distinguished. According to estimation results, the induced-effect coefficients of the MCI are greater than those of the O&M in every power source. The induced production effect coefficient of the MCI is decreased in the order of mega PV > small PV > LNG power > offshore wind > onshore wind. The induced production effect coefficient of the O&M is decreased in the order of mega PV > small PV > onshore wind > offshore wind > LNG thermal. The induced employment coefficient of the MCI is decreased in the order of LNG thermal > mega PV > small PV > onshore wind > offshore wind. PV power and wind power have bigger induced effects and bring economic effects in Korean economy. The carbon neutrality and energy transition policies implemented by Korea have a certain level of induced effects and offset the burden of transition costs even if existing power sources are replaced with environmentally friendly power sources.