Decomposition Analysis of Greenhouse Gas Emissions in the European Union Based on Its Sectoral Structure

Climate change is a serious threat to sustainable development (SD). A Decomposition Analysis (DA) of the data on Greenhouse Gas (GHG) emissions in the European Union (EU) in 2008 - 2014 was carried out using the Log-Mean Divisia Index Method (LMDI). To detect the factors behind de/coupling of GHG emissions from Gross Value Added (GVA) in the EU-28, changes of GHG emissions were divided into three effects. The negative intensity effect showed the highest absolute magnitude in the overall period 2008 - 2014 and the two partial periods 2008 - 2011 and 2011 - 2014. The composition effect also helped reduce GHG emissions, but to a lesser extent. The scale effect boosted increases of GHG emissions except for two years, 2009 and 2012, which was related to the effects of the economic crisis. Transportation and storage along with the Agriculture, forestry and fishing activities should be addressed more significantly in relation to GHG emissions.