Comparison of technology efficiency for CO2 emissions reduction among European countries based on DEA with decomposed factors

Abstract

For consistent and effective CO2 reduction, many countries need to improve not only the technical efficiency of CO2 mitigation, but also environmental responsibility. In this study, we examine both the technical efficiency and voluntary environmental consciousness (VEC) of 12 European countries using a two-stage data envelopment analysis (DEA). In the first stage, we measured the technical efficiency of green energy technologies (GET) associated with fossil fuels, renewable energy, and storage technologies of each country for energy generation with regard to CO2 emissions by surveying GET-related patents. Using the logarithmic mean Divisia index (LMDI), we decomposed CO2 emissions into the following technological factors: energy intensity, fuel mix, and CO2 emission coefficient. In the second stage, we quantified the VEC in each country by investigating GET patent changes via research and development (R&D) investment at given changes in CO2 emissions. The results show different aspects for each country in terms of technical efficiency and VEC, suggesting potential levels of both efficient CO2 reductions and desirable GET development by using reference countries as a benchmark. Our study methodology and results can contribute to establishing effective national technology policy and aid in calls for common responsibility and the active participation of nations in addressing climate change.