Improving the efficiency of Energy consumption in the industrial sector and its sub-sections is important since it can have multifaceted positive effects. First, it reduces production cost at the macro level. Second it helps decrease the volume of needed subsidies. And third, it helps reduce the final cost for industrial products. The three mentioned outcomes of more efficient Energy consumption in turn help enhance the added value of these sectors, increase competitiveness, enhance product quality, reduce import of some key and basic goods and make it possible to increase export of artificially-made products. The present study examines the effects of cutting Energy subsidies on Energy intensity in Iran’s industries. The seasonal time series data approach has been used together with Cobb-Douglas cost function to study the period covering years 2006-2013. The findings showed a negative correlation existed between Energy intensity and Energy prices. Also we found that with technological advancement over time comes a decrease in Energy intensity. Then the Energy prices liberalization scenario was studied for the period covering 2010-2013, assuming a steady rise in nominal prices in the studied period. The findings illustrate that following Energy prices liberalization, Energy intensity is decreased. Indeed, the highest decrease in Energy intensity happens during the first year of liberalization. However, from the second year onwards, the steep decrease in Energy intensity slows.