Between 2000 and 2020, the residential sector’s share of Algeria’s final energy consumption
was 62.20% and 46.05% respectively; this was much higher than the global average of
31%. This enables us to comprehend the factors that contribute to the rise in energy
consumption in the residential sector and to carry out a quantitative analysis to
determine the extent to which energy efficiency reduces energy consumption in the
sector between 2000 and 2020. To accomplish this, we employ the decomposition analysis
approach by using the Logarithmic Mean Divisia Index (LMDI). The results of the study
showed that the energy subsidy factor had a strong impact on increasing residential
energy consumption in Algeria, compared to the population growth factor. In addition,
the energy intensity factor and the economic structure factor did not help reduce
energy consumption levels. According to these findings, Algerian public policymakers
should strictly implement the national energy program Horizon 2030 by rationalising
energy use, eliminating subsidies gradually, and monitoring the implementation of
energy efficiency measures in the residential sector.
