**Evaluation of Electricity Consumption in
the Manufacturing Division**

|The energy intensities presented in this report
    do not reflect adjustments for losses in electricity generation or transmission. EIA is
    presently involved in a study
    of the measurement of energy efficiency. As part of this study, energy intensities will be
    developed separately for electricity that will reflect adjustments for losses in
    electricity generation or transmission.
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Electricity consumption can be expressed in terms of either
physical units, most commonly kilowatthours (kWh), or a common thermal unit, most commonly
British thermal units (Btu).

The physical unit is meant to give a clear understanding of the
amount of a particular energy source being used, while the thermal unit is a measure of
convenience used to aggregate or compare various energy sources measured in different
physical units. Converting kWh of electricity to Btu is not a trivial issue, because the
amount of input energy needed to create a kWh of electricity is far greater than the
amount of useful energy in the kWh at its point of use. Therefore, meaningful conversions
of electricity use from kWh to Btu can be given in terms of:

- Site (point-of-use) electricity, at the universal value of 3,412
    Btu/kWh. This value is useful to engineers, energy managers, and others trying to evaluate
    energy efficiency.
- Primary electricity, at a value that reflects the content of the
    energy inputs used to produce the electricity. This rate is most useful to policymakers
    and analysts who are considering global resources and environmental issues.

For convenience and consistency, a factor is traditionally used to
convert point-of-use electricity use to primary electricity: 10,447 Btu/kWh for 1985,
10,324 Btu/kWh for 1988, 10,352 Btu/kWh for 1991and 10,280 Btu/kWh for 1994. These factors
represent the average energy input to the generation process for fossil-fuel utility
plants in the United States for their respective year, as given in EIA's Monthly Energy
Review (DOE/EIA-0035(95/03)). However, the reader should understand that the *true*
conversion values for the range of electricity estimates are unknown. Applying the single
value to the range of electricity estimates in this report provides only a rough
approximation of primary electricity because:

- For some type of utility energy inputs--hydroelectric, wood/waste,
    wind, and solar (thermal or photovoltaic), there is no generally accepted conversion rate.
- The fossil-fueled, nuclear, and geothermal generation processes
    have known but different conversion rates, so the overall conversion rate for these energy
    sources is a function of their mix.

A particular problem with manufacturing is that industries tend to
be clustered much more than households and businesses in general. The
electricity-intensive industries, such as aluminum, are concentrated in areas with
inexpensive electricity, usually hydropower-generated. Thus, the accuracy of the overall
conversion factor given above varies across industry groups. Estimates of primary
electricity using this conversion factor should thus be treated with caution. They should
be considered rough alternative measures to site energy as indicators of the importance of
electricity as a manufacturing energy source.  Because of these intractable
conversion problems, this report excludes energy intensity estimates where primary
electricity is a component.

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