For the purposes of energy conservation and environmental protection, the government of Taiwan has instigated long-term policies to continuously encourage and assist industry in improving the efficiency of energy utilization. While multiple actions have led to practical energy saving to a limited extent, no strong evidence of improvement in energy efficiency was observed from the energy efficiency indicators (EEI) system, according to the annual national energy statistics and survey. A structural analysis of EEI is needed in order to understand the role that energy efficiency plays in the EEI system. This work uses the Taylor series expansion to develop a structure model for EEI at the level of the process sector of industry. The model is developed on the premise that the design parameters of the process are used in comparison with the operational parameters for energy differences. The utilization index of production capability and the variation index of energy utilization are formulated in the model to describe the differences between EEIs. Both qualitative and quantitative methods for the analysis of energy efficiency and energy savings are derived from the model. Through structural analysis, the model showed that, while the performance of EEI is proportional to the process utilization index of production capability, it is possible that energy may develop in a direction opposite to that of EEL This helps to explain, at least in part, the inconsistency between EEI and energy savings. An energy-intensive steel plant in Taiwan was selected to show the application of the model. The energy utilization efficiency of the plant was evaluated and the amount of energy that had been saved or over-used in the production process was estimated. Some insights gained from the model outcomes are helpful to further enhance energy efficiency in the plant. (c) 2007 Elsevier Ltd. All rights reserved.