For the first time in years, Italy's energy use contracted while the economy grew, a new report showed.
But despite the environmental benefits of such a decline, it is unclear whether the reduced energy use should be seen as a positive development.
Figures released by the Italian Ministry of Finance show that the country's economy grew by a modest 0.2 percent in 2018. Meanwhile, energy use fell by 2.2 percent over the same period.
Lower energy use is a positive development from an environmental perspective, since reduced energy generation results in lower levels of greenhouse gas emissions and better air quality.
But in Italy's case, the economic implications could outweigh the environmental impacts: local media reported that the main culprit behind the lower energy use is a 6 percent-plus reduction in industrial production.
In that context, analysts were divided about whether reduced energy use was ultimately positive.
"Industrial production rises and falls based on cyclical factors and so before drawing a conclusion I think we need to figure out if this drop in industrial production is cyclical and how much is it structural," Andrea Montanino, chief economist at Confindustria, the General Confederation of Italian Industry, told Xinhua.
"If it is mostly structural, it's a bad sign," Montanino went on, since Italy is an important industrial power both in Europe and in the world. "Any long-term slowdown would have serious consequences."
According to analysts, some other factors could also act as a drag on economic growth and energy use, ranging from a general economic slowdown across Europe to political instability in Italy and an unusually warm winter that cut back heating costs.
According to Edoardo Zanchini, vice president of Legambiente, Italy's largest environmental lobby group, the lower levels of energy use are part of the decoupling of energy use from economic growth that is starting to gain traction in various countries.
"This is different from what happened after the big market crash in 2008," Zanchini said in an interview. "That was very serious, with factories and other economic activity at a standstill. Today, we're seeing that energy use does not have to increase at the same rate as economic growth. There are gains to be made through efficiencies."
Zanchini cited the example of Denmark, which has seen energy use decline by 30 percent even as the country's economy continued to grow.
"Until a few years ago, rising energy use was seen as a sign of a healthy economy," Zanchini said. "That is no longer the case. If the world is to achieve the goal of preventing the worst impacts of climate change, economies need to grow without increasing energy use."
Italy's gross domestic product growth rate slowed significantly in the second half of 2018, with the economy actually contracting and entering into recession.
Early projections are for the economy to contract another 0.2 percent in the first quarter of this year and most multilateral groups, ratings agencies and investment banks think that the economy will see flat growth in 2019 as a whole.
But it is too early to estimate how much slow growth will affect energy use.
Editor:Cherie
