Resilience of the global coal sector under exogenous economic shocks

Abstract

This paper presents the research and quantitation estimation of influence exerted by different factors on consumption of primary energy sources. The authors propose a functional dependence between the factors of economy, demography and resources, which describes consumption of primary energy sources in the developed and developing countries. The base research method is the Logarithmic Mean Divisia Index (LMDI). As distinct from the other indices, LMDI is free from the problem of indecomposable remainder and is applicable to multi-factor models. Using this methodical approach, the authors show that the major energy source having the highest influence on energy consumption is coal in the developed countries and alternative (non-fossil) energy sources in the developing countries. The researchers draw the inference on instability of the coal sector in the period of 1995-2020 and define some ways to stabilizing the situation both in the industry and in the coal mining regions.