ECONOMIC REPORT OF THE PRESIDENT

Figure 7-24
Growth Rates of GDP, Energy Intensity and Carbon
Intensity, 2008–2015
Compound Annual Growth Rate
2.0
1.5
1.0
0.5
0.0
-0.5
-1.0
-1.5
-2.0
Real GDP Energy Intensity Carbon Intensity
Source: Bureau of Economic Analysis, National Income and Product Accounts; Energy
Information Administration.
on the size of the economy in 2015. The decomposition analysis follows the
methodology in CEA (2013), but with the added component of considering
emissions from both “expected” and “unexpected” trends. The emissions
considered in the analysis are energy-related carbon dioxide emissions,
which comprised 97 percent of U.S. carbon dioxide emissions and 83.6 percent
of U.S. greenhouse gas emissions in 2014 (EPA 2016a).
As an initial step, one could simply look at GDP growth, energy
intensity, and the carbon intensity of energy production to see what has
influenced changes in emissions (Figure 7-24). Rising GDP, all else equal,
causes an increase in emissions, but the declining energy intensity of output
(energy usage per dollar of GDP) and the declining carbon intensity
of energy (carbon emissions per energy usage) both pushed down on this
tendency of emissions to rise as the economy grows.
Alternatively, one can use expectations for the paths of these three
variables to understand what drove emissions relative to a reasonable
expectation in 2008. The general approach of this decomposition is to ask
the following: starting in a given base year, what were actual or plausible
projections of the values of GDP, energy intensity, and the carbon intensity
of energy out to the current year. These three values imply a projected value
for the current level of carbon emissions. Then, relative to this forecast,
what were the actual emissions, and what were the actual values of these
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