Empirical Study on the Relationship of China's Energy Consumption and Industrial Structure Change

In order to understand the law of China's energy consumption growth, we use cointegration method and set up the vector error correction model to do quantitative analysis on the relationships among China's three industries' output values and its energy consumption. Our results can be summarized as follows: i) There is one-way causality relationship between the energy consumption and the output value of the first and the second industry, but no obvious causality relationship exists between the energy consumption and the output value of the third industry; ii) The impacts of the energy consumption on the output value of the first and the second industry are not the same in the short term; iii) The increase of energy consumption has positive effect on the first and the second industry's development in the long term. Knowing these clearly will help us take more specific measures to balance the energy demand and supply.