Energy Accounts

Energy accounts are the SEEA-Energy counterpart to the energy balance: both are compiled from largely the same basic energy statistics, but they differ in geographical coverage principle, terminology and presentation, so converting balance data into accounts requires a defined set of adjustments [IRES, Ch. XI, para. 11.6, PDF p. 149, 2018]. The differences fall into three groups: conceptual, terminological and presentational [IRES, Ch. XI, para. 11.6, PDF p. 149, 2018].

Conceptual differences: territory principle vs. residence principle

The main conceptual difference between energy balances and energy accounts is geographical coverage.

• Energy balances use the territory principle: the reference territory is the national territory, and statistics are compiled for all units physically located in that territory, regardless of their residence status; units physically located outside the territory are part of the rest of the world. See Reference Territory for the full definition of this territory [IRES, Ch. XI, para. 11.7, PDF p. 149, 2018].
• Energy accounts use the residence principle: geographic coverage is based on all institutional units resident in the national economy, independent of their physical location; non-resident units are part of the rest of the world. An institutional unit is resident in a country when its centre of predominant economic interest is within that country’s economic territory. The economic territory generally aligns with the physical boundary of the country, but is adjusted for embassies, consulates, military bases, scientific stations and the like, which belong only to the economic territory of the country they represent [IRES, Ch. XI, para. 11.8, PDF p. 149, 2018].

This distinction directly extends the territory-vs-residence contrast noted for reference territory itself, where energy statistics allocate on physical location while economic statistics generally (including energy accounts) allocate on residence [IRES, Ch. II, para. 2.16, PDF p. 33, 2018].

The choice of principle changes how several flows are recorded [IRES, Ch. XI, para. 11.9, PDF p. 149, 2018]:

• Imports/exports. Under the territory principle, imports and exports cover all transactions between units physically present in the territory and units physically located outside it, independent of residence status — trade follows the physical movement of goods, and transactions between units both physically located within the territory are never recorded as imports/exports even if their residence status differs. Under the residence principle, imports/exports instead cover transactions between resident and non-resident units independent of where the transaction occurs — whether abroad (e.g., national tourists abroad) or within the national territory (e.g., foreign companies refuelling inland) [IRES, Ch. XI, para. 11.10, PDF p. 149, 2018].
• Use of products. In the energy balance, the use of energy in the territory covers use by all units physically located there. In energy accounts, use covers only the use of resident units — use by non-resident units is instead recorded as an export (provided the supplying unit is resident). Energy accounts additionally include the use of energy products by resident units abroad, with the counterpart transaction on the supply side recorded as an import — e.g., residents refuelling their own vehicles abroad, and ships operated by residents refuelled abroad [IRES, Ch. XI, para. 11.11, PDF p. 149, 2018].
• International bunkers. Bunkering is recorded in energy accounts as intermediate consumption if undertaken by a ship operated by a resident unit, or as exports if the ship is operated by a non-resident unit [IRES, Ch. XI, para. 11.14, PDF p. 150, 2018].
• Residents abroad / non-residents in territory. See the imports/exports and use-of-products points above — these are the two categories of unit the residence principle treats differently from the territory principle (fuel purchases and use by residents abroad become imports/use in accounts; use by non-residents in the territory becomes an export rather than domestic use) [IRES, Ch. XI, paras 11.10–11.11, PDF p. 149, 2018].

Terminological differences

Terms such as “supply,” “final consumption,” “stocks” and “stock changes” are well-defined in both systems, but their definitions differ [IRES, Ch. XI, para. 11.12, PDF p. 149, 2018].

Supply. In energy balances, supply represents energy entering the national territory for the first time, less energy exiting the territory (through exports or international bunkering) and stock changes:

Total energy supply = Primary energy production

• Import of primary and secondary energy − Export of primary and secondary energy − International (aviation and marine) bunkers − Stock changes

[IRES, Ch. XI, para. 11.13, PDF pp. 149–150, 2018]

See Total Energy Supply for the full treatment of this balance-side aggregate. In energy accounts, by contrast, supply is defined as the sum of the production of primary energy and imports (according to the residence principle) of energy products. Exports, international bunkers and stock changes, together with intermediate consumption and capital formation, are all considered uses rather than supply-side deductions [IRES, Ch. XI, para. 11.14, PDF p. 150, 2018].

Final consumption. In energy balances, final consumption refers to the use of fuel, electricity and heat delivered to final consumers for both their energy and non-energy uses, excluding use by energy industries (and other energy producers) as input to transformation and energy industries own use — see Final Consumption for the full balance-side definition. In energy accounts, “final consumption” instead denotes the use of goods and services by individual households or government to satisfy individual or collective needs or wants; when goods and services are used as inputs to the production process by economic units, this is called intermediate consumption instead [IRES, Ch. XI, para. 11.15, PDF p. 150, 2018].

Stocks and stock changes. The balance concepts of stocks and stock changes (see Stock Changes) correspond to “inventories” and “changes in inventories” in SEEA-Energy (and SNA 2008). Stock changes appear in the balance as part of total supply, but in the energy accounts they appear as part of use [IRES, Ch. XI, para. 11.16, PDF p. 150, 2018].

Presentational differences

Standard energy-account tables present statistics for economic activities and households strictly following the classification principles and structure of ISIC Rev. 4: information on any specific enterprise/establishment, whether on the production or consumption side, is presented under the ISIC category of that unit’s principal activity. Energy balances do not follow this principle — information on a given enterprise/establishment is not completely linked to its ISIC category, but is instead presented in different sections of the balance depending on the type of use and the ISIC category of the unit involved [IRES, Ch. XI, para. 11.17, PDF p. 150, 2018].

Two worked examples illustrate the consequence:

• Transport. Energy accounts present data strictly by the ISIC category of the statistical unit involved, showing transport and other uses within the ISIC class of that unit. Energy balances instead introduce a total aggregate “transport,” covering total energy use for transport purposes across all economic activities, broken down by mode — as a result, the portion of energy used for transport by individual ISIC industries is excluded from the other final-consumption aggregates (e.g., wholesalers, manufacturers) in energy balances [IRES, Ch. XI, para. 11.18, PDF p. 150, 2018].
• Energy used to produce other energy products. Energy accounts again follow strict ISIC categories, while energy balances record energy transformed into other products under the entry “transformation” (broken down by transformation technology), and energy consumed to support energy production under “energy industries own use” [IRES, Ch. XI, para. 11.19, PDF pp. 150–151, 2018].

The energy balance also allows a balancing item, “statistical difference,” whereas energy accounts, by design, do not allow a discrepancy between supply and use; where a discrepancy exists, reconciliation and allocation to specific flows are needed to reduce or eliminate it [IRES, Ch. XI, para. 11.20, PDF p. 151, 2018].

Adjustments to compile SEEA-Energy accounts from balance data

Basic energy statistics and energy balances can be used as a data source for compiling the SEEA-Energy physical supply and use tables (PSUTs — see System of Environmental-Economic Accounting for Energy), but because of the conceptual and definitional differences above, adjustments are needed [IRES, Ch. XI, para. 11.21, PDF p. 151, 2018]:

• Imports/exports adjustments. Relating balance imports/exports to transactions between resident and non-resident units — e.g., including fuel purchases by residents abroad as imports [IRES, Ch. XI, para. 11.22, PDF p. 151, 2018].
• Other geographical-coverage adjustments. Covering international marine/aviation bunkering and the bottom-block items of the balance; disaggregating balance uses of energy products so they can be recorded as intermediate/final consumption (resident units), export (non-resident units), or use by resident units abroad — the same logic applied to bunkering [IRES, Ch. XI, para. 11.23, PDF p. 151, 2018].
• Enclave adjustments. Excluding foreign territorial enclaves in the national territory and/or including national territorial enclaves in the rest of the world (embassies, consulates, military bases, scientific stations, etc.). These enclaves are included in basic statistics and energy balances when foreign enclaves are located in the national territory, and excluded when national enclaves are located abroad; the accounting framework treats coverage the opposite way — national enclaves abroad are included, foreign enclaves within the territory are excluded [IRES, Ch. XI, para. 11.24, PDF p. 151, 2018].
• ISIC reallocation. Regrouping information — such as on “transformation,” “transport,” “non-energy use,” “energy industries own use” and “primary production” — to the relevant ISIC category, so it can be presented in the purely ISIC-based tabulation SEEA-Energy uses [IRES, Ch. XI, para. 11.25, PDF p. 151, 2018].
• Bridge tables. Constructed to clearly show the links for the total supply and total use of different products between the energy accounts and the energy balances [IRES, Ch. XI, para. 11.26, PDF p. 151, 2018].

To perform these adjustments, additional data items are needed beyond the balance itself — for example, the breakdown of deliveries for international bunkering between resident and non-resident units, deliveries to resident and non-resident final consumers, and the use of energy products by resident units abroad [IRES, Ch. XI, para. 11.27, PDF p. 151, 2018].

Recommendation 11.28

In view of the differences above, countries are encouraged to clearly document and make available the methods used for the reallocation and adjustment of data provided by basic energy statistics and balances to energy accounts [IRES, Ch. XI, para. 11.28, PDF p. 151, 2018] — recommendations tracker row XI/11.28.

Related

• IRES Chapter XI — Uses of Basic Energy Statistics and Balances — the chapter digest this page supports
• System of Environmental-Economic Accounting for Energy — SEEA-Energy, the accounts framework this page’s balances-vs-accounts distinction supports
• Energy Balance — the balance-side accounting framework this page contrasts with energy accounts
• Reference Territory — the territory-principle definition this page’s conceptual-differences section deepens with the accounts-side residence principle
• International Standard Industrial Classification of All Economic Activities — the classification energy accounts’ standard tables strictly follow
• System of National Accounts — SEEA-Energy’s parent framework for concepts, definitions and classifications
• Total Energy Supply — the balance-side supply aggregate whose accounts-side counterpart is described in the terminology section above
• Final Consumption — the balance-side final consumption definition contrasted with the accounts-side term
• Stock Changes — the balance-side stocks concept corresponding to SEEA-Energy “inventories”
• Imports and Exports and International Bunkers — the flows most affected by the territory-vs-residence principle and the adjustments needed to reconcile them