Energy Efficiency in OECD Countries: A DEA Approach

Abstract

his paper deals with energy efficiency examined through an integrated model that links energy with environment, technology, and urbanisation as related areas. Our main goal is to discover how efficiently developed countries use primary energy and electricity (secondary energy). We additionally want to find out how the inclusion of environmental care and renewable energy capacity affects efficiency. For that purpose, we set up an output-oriented BCC data envelopment analysis that employs a set of input variables with non-negative values to calculate the efficiency scores on minimising energy use and losses as well as environmental emissions for a sample of 30 OECD member states during the period from 2001 to 2018. We develop a couple of baseline models in which we find that countries have mean inefficiency margins of 16.1% for primary energy and from 10.8 to 13.5% for electricity. The results from the extended models show that taking care about environment does not affect efficiency in general, while the reliance on energy produced from renewable sources does slightly reduce it.