Signal Industrial electricity demand has been systematically overestimated

Summary

Sector forecasts from the Korea Energy Economics Institute's medium-term outlooks for 2016 to 2024 show a persistent upward bias for industry. The average absolute percentage error for the industrial sector across those outlooks is 7.6 percent, below transport but above buildings. The author suggests that structural change in industry, business-cycle conditions and falling energy intensity combined to make actual growth slower than expected. Output swings in power-hungry sectors such as steel, petrochemicals and cement can move industrial demand sharply. Simple trend extrapolation therefore struggles to explain the sector's behaviour.