Convergence of Energy Policies between the EU and Ukraine under the Green Deal Policy

Abstract

EU countries declared the strategic goal to achieve energy independence and increase energy efficiency. In this case, EU countries have provided a vast range of incentives, mechanisms, and directives to promote energy efficiency. Ukraine as a potential candidate should provide a convergent policy with EU countries to increase energy efficiency. The paper aims to estimate energy efficiency based on the revealed convergent and divergent determinants of energy policies among the EU and Ukraine. The data are compiled from the World Energy Statistics Yearbook, the European Statistical Office, the International Energy Agency, SolAbility agencies, and State Statistics Service of Ukraine. The study applies σ- i β-convergence theory to determine the convergent and divergent determinants of the country’s energy efficiency. The empirical results allow concluding that Ukraine has an average level in the integrated energy efficiency index of the national economy, and the highest value of this index was in 2008. The highest values of energy efficiency were in Sweden and Denmark among EU countries. Besides, the findings confirm that the Ukrainian government should pay attention to divergent determinants (expenditure for environmental protection, pricing for energy resources, etc.) to improve the country’s energy efficiency.