Energy Use in the Industrial Sector
Key highlights
- Canadian industry saved $4.9 billion in energy costs due to a 16% energy efficiency improvement in 2016.
- Industrial energy use increased 26%. It would have increased 42% without energy efficiency improvements.
- In 2016, Canadian industry saved 426 PJ of energy and reduced 21.2 Mt of GHG emissions.
- Energy intensity (MJ/$2007 – GDP) decreased 14.9%.
Overview - Energy use and GHG emissions
The industrial sector spent $39.5 billion on energy in 2016 for all their manufacturing, resource extraction, forestry and construction activities.
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Distribution of industrial energy use by fuel type, 2016
Percentage | |
---|---|
Electricity | 21.6 |
Natural gas | 39.5 |
Oil | 8.0 |
Still gas and petroleum coke | 13.5 |
Wood waste and pulping liquor | 10.9 |
Other | 6.5 |
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Distribution of energy use and activity by industry, 2016 (percentage)
Industry | GDP | Energy use |
---|---|---|
Construction | 27.3 | 3.0 |
Forestry | 1.3 | 0.8 |
Mining (including oil sands extraction) | 31.0 | 35.0 |
Manufacturing | 40.4 | 61.1 |
Industrial energy use
From 1990 to 2016, industrial energy use increased 26%, from 2,710 PJ to 3,414 PJ. The associated end-use GHG emissions increased 20%, from 141.4 Mt to 169.8 Mt.
Natural gas use grew while major declines were reported in heavy fuel oil2 (HFO) and coke and coke oven gas. The shift toward less emission-intensive fuels over the period resulted in lower growth in GHG emissions.
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Industrial energy use by fuel type, 1990 and 2016 (petajoules)
1990 | 2016 | |
---|---|---|
Electricity | 658.4 | 738.4 |
Natural gas | 837.2 | 1348.1 |
Oil | 328.7 | 272.0 |
Still gas and petroleum coke | 309.9 | 460.6 |
Wood waste and pulping liquor | 341.0 | 373.3 |
Other | 234.6 | 221.4 |
Energy use in resource extraction
Since 1990, the subsector’s energy consumption and its associated end-use emissions have more than tripled. Over the 1990–2016 period, this subsector's GDP increased 60%, compared to a 48% increase for the entire sector.
Activity in the oil sands was the main driver in energy demand from the resource extraction industries. Since the late 1990s, production from non-conventional resources (oil sands) increased. The production of bitumen and synthetic crude oil increased from 55,000 cubic metres per day (m3/day) in 1990 to 384,000 m3/day by 2016.
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Industrial energy use by selected industries, 1990 and 2016 (petajoules)
1990 | 2016 | |
---|---|---|
Upstream mining (including oil and gas extraction) | 210.7 | 1048.9 |
Pulp and paper | 728.0 | 552.0 |
Petroleum refining | 323.0 | 271.0 |
Chemicals | 223.0 | 278.0 |
Iron and steel | 219.0 | 221.0 |
Other industries | 1005.0 | 1043.0 |
Manufacturing energy use
The Manufacturing sector consumed 2,086 PJ of energy in 2016, one quarter of the energy used by final consumers in Canada, representing a decline of 8.8% since 1990. Although there are 21 subsectors with NAICS 3-digit codes, four of these subsectors accounted for 75% of all energy consumption in the manufacturing sector.
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Share of energy use in the Manufacturing sector, 2016
Percentage | |
---|---|
Pulp and paper | 26.5 |
Smelting and refining | 12.0 |
Chemicals | 13.3 |
Petroleum refining | 13.0 |
Wood products | 2.9 |
Iron and steel | 10.6 |
Cement | 2.7 |
Other Manufacturing subsectors | 19.0 |
Paper Manufacturing
Energy use for Paper Manufacturing production peaked in 2004 and declined consistently since then. In 2016, the subsector consumed 552 PJ of energy, a decrease of 24% from 728 PJ in 1990. Pulp, paperboard, paper and newsprint mills all decreased their energy use significantly from 1990 to 2016, with the largest decline experienced in newsprint (-68%). GHG emissions decreased 60% since 1990 for the subsector as a whole.
This subsector is a major player in combined heat and power (CHP), which can result in a substantial increase in energy efficiency as compared to separate electricity generation and heating.
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Paper Manufacturing energy use by selected industry, 1990 and 2016 (petajoules)
1990 | 2016 | |
---|---|---|
Pulp mills | 300.2 | 286.2 |
Paperboard mills | 62.6 | 33.6 |
Paper mills (except newsprint) | 99.8 | 75.3 |
Newsprint mills | 247.6 | 79.7 |
Other | 17.9 | 77.6 |
Primary Metal Manufacturing
This subsector saw its energy consumption increase by 17% to 471 PJ in 2016. From 1990 to 2016, energy demand in the production of alumina and aluminum grew 87%, emitting just 26% more GHG emissions. Since 1990, GDP in the production of alumina and aluminum has more than tripled, from $1.2 billion ($2007) in 1990 to $4.2 billion ($2007) in 2016.
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Smelting and refining energy use by selected industry, 1990 and 2016 (petajoules)
1990 | 2016 | |
---|---|---|
Alumina and aluminum | 109.8 | 205.7 |
Other non-ferrous | 73.5 | 44.6 |
Smelting and refining | 183.3 | 250.3 |
Chemical Manufacturing
Energy use in Chemical Manufacturing rose 25% from 223 PJ in 1990 to 278 PJ in 2016, driven in part by increasing energy demand in industrial gas manufacturing. Natural gas (68% share) and electricity (28% share) accounted for the majority of the energy needs for the Chemical Manufacturing subsector. GHG emissions from this subsector increased 12%.
In contrast, energy use in Petroleum Refining declined 16%, even though the production level of the petroleum refining industry was 5% higher in 2016 than in 1990. GHG emissions declined 11% from 1990 to 2016, reflective of energy efficiency improvements.
Wood Product Manufacturing
- sawing logs into lumber and similar products, or preserving these products
- making products that improve the natural characteristics of wood; for example, by making veneers, plywood, reconstituted wood panel products or engineered wood assemblies
- making a diverse range of wood products such as millwork
This subsector represented only 3% of the Manufacturing sector’s energy use with 58.5 PJ in 2016. GHG emissions decreased 22.7% between 1990 and 2016, reflecting a shift in lower and non-GHG emissions energy sources.
Isolating the effect of energy efficiency in industry
Without energy efficiency gains, energy use would have increased 42% instead of 26%.
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Impact of activity, structure and energy efficiency on the change in industrial energy use, 1990–2016
Petajoules | |
---|---|
Total change in energy use | 703.9 |
Activity effect | 2,185.4 |
Structure effect | -1,055.8 |
Energy efficiency effect | -425.8 |
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Industrial energy use, with and without energy efficiency improvements, 1990–2015
Energy use without energy efficiency improvements | Energy use with energy efficiency improvements | |
---|---|---|
1990 | 2710.0 | 2710.0 |
1995 | 3058.0 | 3017.3 |
1996 | 3104.4 | 3019.6 |
1997 | 3231.7 | 3086.4 |
1998 | 3290.1 | 2998.6 |
1999 | 3465.8 | 3046.4 |
2000 | 3595.2 | 3166.9 |
2001 | 3513.1 | 3023.3 |
2002 | 3664.8 | 3139.6 |
2003 | 3655.6 | 3203.0 |
2004 | 3745.7 | 3367.5 |
2005 | 3735.5 | 3292.1 |
2006 | 3626.4 | 3292.4 |
2007 | 3745.0 | 3420.7 |
2008 | 3576.5 | 3278.2 |
2009 | 3256.5 | 3113.6 |
2010 | 3435.9 | 3215.5 |
2011 | 3488.1 | 3302.8 |
2012 | 3526.2 | 3342.2 |
2013 | 3626.3 | 3370.4 |
2014 | 3772.8 | 3386.9 |
2015 | 3798.1 | 3441.2 |
2016 | 3839.6 | 3413.8 |
Various factors influenced change in energy use:
- Activity effect – A significant increase in oil sands mining and conventional oil and gas production increased energy use in the industrial sector by 2,185 PJ and GHG emissions by 109 Mt.
- Structure effect – A shift from energy-intensive heavy manufacturing to financial and service-related activities continued, resulting in a reduction of 1,056 PJ of energy use and 53 Mt of GHG emissions in 2016.
- Service level effect – There is no service level effect for the industrial sector.
- Weather effect – There is no weather effect for the industrial sector.
- Energy efficiency effect – In 2016, Canadian industry saved $4.9 billion in energy costs because of a 16% energy efficiency improvement. Industry saved 426 PJ of energy and reduced GHG emissions by 21.2 Mt.
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Factors influencing energy consumption, 1990-2016
Total change in energy use | Activity effect | Structure effect | Energy efficiency effect | |
---|---|---|---|---|
1990 | 0.0 | 0.0 | 0.0 | 0.0 |
1995 | 307.4 | 249.7 | 98.3 | -40.6 |
1996 | 309.7 | 298.4 | 96.0 | -84.8 |
1997 | 376.5 | 471.4 | 50.3 | -145.2 |
1998 | 288.7 | 580.4 | -0.2 | -291.5 |
1999 | 336.5 | 719.4 | 36.4 | -419.4 |
2000 | 457.0 | 911.1 | -25.9 | -428.3 |
2001 | 313.4 | 942.6 | -139.5 | -489.8 |
2002 | 429.6 | 1076.8 | -122.0 | -525.2 |
2003 | 493.0 | 1137.6 | -192.0 | -452.6 |
2004 | 657.6 | 1328.1 | -292.4 | -378.1 |
2005 | 582.2 | 1366.8 | -341.2 | -443.4 |
2006 | 582.5 | 1480.3 | -563.9 | -334.0 |
2007 | 710.7 | 1530.7 | -495.6 | -324.4 |
2008 | 568.2 | 1467.3 | -600.8 | -298.3 |
2009 | 403.7 | 1349.9 | -803.4 | -142.9 |
2010 | 505.5 | 1549.3 | -823.47 | -220.4 |
2011 | 592.9 | 1646.4 | -868.3 | -185.3 |
2012 | 632.2 | 1840.6 | -1024.3 | -184.1 |
2013 | 660.4 | 1953.6 | -1037.0 | -255.9 |
2014 | 676.9 | 2132.6 | -1069.8 | -385.9 |
2015 | 731.2 | 2169.6 | -1081.5 | -356.9 |
2016 | 703.9 | 2185.4 | -1055.8 | -425.8 |
Manufacturing energy savings were 670.7 PJ in 2016, reflecting a strong energy efficiency performance in manufacturing related activities.
Energy use in the resource extraction sector more than tripled from 1990 to 2016. Resource extraction industries posted much higher energy intensity per unit of economic activity, especially in the upstream mining sector (including oil and gas extraction), reflecting the opportunity for more energy efficiency.
Excluding resource extraction, Canadian industries improved energy efficiency by 27%, which represents 646.8 PJ of savings.
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Industrial energy use, with and without energy efficiency improvements (without resource extraction industries), 1990-2016
Energy use without energy efficiency improvements | Energy use with energy efficiency improvements | |
---|---|---|
1990 | 2362.4 | 2362.4 |
1995 | 2638.6 | 2571.4 |
1996 | 2681.6 | 2550.3 |
1997 | 2778.6 | 2615.2 |
1998 | 2812.9 | 2547.5 |
1999 | 2998.8 | 2548.2 |
2000 | 3100.7 | 2656.7 |
2001 | 3008.1 | 2505.3 |
2002 | 3131.2 | 2604.8 |
2003 | 3100.5 | 2569.3 |
2004 | 3128.3 | 2748.7 |
2005 | 3122.6 | 2634.0 |
2006 | 2978.6 | 2589.7 |
2007 | 3073.8 | 2566.7 |
2008 | 2909.6 | 2417.0 |
2009 | 2582.0 | 2186.4 |
2010 | 2731.0 | 2215.6 |
2011 | 2741.5 | 2263.5 |
2012 | 2731.5 | 2251.3 |
2013 | 2773.2 | 2273.9 |
2014 | 2840.9 | 2281.3 |
2015 | 2840.6 | 2287.4 |
2016 | 2864.3 | 2217.4 |
The impact of activity, structure and energy efficiency on the change in industrial energy use excluding the resource extraction industries were:
- Activity effect – Industrial activity increased energy use by 1,711 PJ and GHG emissions by 78.4 Mt.
- Structure effect – The structural changes in the industrial sector, specifically, a relative decrease in the activity share of energy-intensive industries (i.e. pulp and paper), helped the sector to reduce its energy use and GHG emissions by 1,209 PJ and 55.4 Mt, respectively.
- Energy efficiency effect – Improvements in the energy efficiency reduced energy use by 647 PJ and avoided 29.6 Mt of GHG emissions.
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Factors influencing industrial energy consumption (without resource extraction), 1990-2016
Total change in energy use | Activity effect | Structure effect | Energy efficiency effect | |
---|---|---|---|---|
1990 | 0.0 | 0.0 | 0.0 | 0.0 |
1995 | 209.1 | 215.3 | 61.0 | -67.2 |
1996 | 187.9 | 256.6 | 62.6 | -131.3 |
1997 | 252.9 | 402.9 | 13.4 | -163.3 |
1998 | 185.1 | 495.3 | -44.7 | -265.4 |
1999 | 185.8 | 612.5 | 24.0 | -450.7 |
2000 | 294.3 | 773.2 | -34.8 | -444.0 |
2001 | 143.0 | 799.5 | -153.7 | -502.8 |
2002 | 242.4 | 910.7 | -141.9 | -526.5 |
2003 | 207.0 | 960.4 | -222.2 | -531.1 |
2004 | 386.3 | 1114.3 | -348.4 | -379.6 |
2005 | 271.6 | 1145.5 | -385.3 | -488.6 |
2006 | 227.4 | 1235.5 | -619.3 | -388.9 |
2007 | 204.4 | 1274.3 | -562.9 | -507.0 |
2008 | 54.7 | 1227.1 | -679.9 | -492.5 |
2009 | -176.0 | 1142.7 | -923.1 | -395.6 |
2010 | -146.8 | 1281.4 | -912.7 | -515.5 |
2011 | -98.8 | 1348.1 | -969.0 | -478.0 |
2012 | -111.1 | 1480.0 | -1110.9 | -480.2 |
2013 | -88.5 | 1556.1 | -1145.3 | -499.3 |
2014 | -81.1 | 1676.6 | -1198.1 | -559.6 |
2015 | -75.0 | 1701.4 | -1223.1 | -553.2 |
2016 | -144.9 | 1711.3 | -1209.4 | -646.8 |
- Wood waste and pulping liquor are primarily used in the pulp and paper industry because they are recycled materials produced only by this industry.
- One reason for the decline in HFO was that the pulp and paper industry, the largest user of HFO, adopted alternate forms of fuels, such as pulping liquor. Fuel switching was facilitated by the use of interruptible contracts with energy suppliers, allowing the industry to react to changes in relative prices of fuels.
- Wood Product Manufacturing does not include industries engaged in logging and chipping logs in the field, which is covered in Forestry and Logging.