Abstract
Increasing energy efficiency and exploiting energy saving potential are two important practices that can help to ensure future energy security in China. This paper proposes a new total factor energy efficiency indicator, based on the directional meta-frontier data envelopment analysis (DEA) approach, to account for the heterogeneity of production technology among provinces in China. This indicator considers both energy savings and economic development, and can also decompose the energy saving potential. An empirical research study conducted on 29 Chinese provinces indicates that the differences in energy efficiency and production technology among the Chinese regions are quite significant. Most eastern coastal provinces maintain high-energy efficiency and advanced production technology, while energy efficiency in the west is typically lower. As a rule, improvements in technical and management factors are needed to exploit energy saving potentials. However, the emphasis on these two factors in each province should differ. China’s general energy efficiency is relatively low; the absolute amount of nationwide energy saving potential is on the rise.
Highlights
Energy efficiency plays important role in reducing energy consumption and carbon dioxide emissions and ensuring national energy security, and, as such, it has attracted great attention from the government, scholars, and other sectors of society
Referring to Batters et al [24], the relationship between MEE and GEE may be described by the technology gap ratio (TGR) of energy efficiency in Equation (8), as
We find that the energy efficiency in the eastern group is 0.773, higher than 0.547 in the central group, and 0.462 in the west group, with respect to the meta-frontier
Summary
Energy efficiency plays important role in reducing energy consumption and carbon dioxide emissions and ensuring national energy security, and, as such, it has attracted great attention from the government, scholars, and other sectors of society. The basic idea of TFEE is to investigate the ratio of the objective energy input and the actual input, according to best production practices It overcomes the limitations of the traditional single factor energy intensity indicator and has become the main method in the field of energy efficiency research [9,10,11,12,13]. This study uses the directional meta-frontier DEA approach to establish a new energy efficiency indicator, considering the premise of production technology heterogeneity. This exercise explores the possibility of uniting energy savings and economic development. It can be used to consider the inner link between energy intensity and total factor energy efficiency
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