Energy efficiency, carbon emission performance, and technology gaps: Evidence from CDM project investment

Abstract

Measuring the energy conservation and carbon emission reduction potential proves the fundamental basis for stakeholders in the cooperation over Clean Development Mechanism (CDM) projects. This research adopts the meta-frontier non-radial directional distance function based on the Data Envelopment Analysis (DEA) window analysis to measure the total factor energy efficiency and carbon emission performance of leading countries involved in CDM projects during 1990–2015. This study employs the panel quantile regression to investigate the dynamic impact of CDM projects on different energy efficiency and carbon emission performance of CDM host countries. The results indicate that, first of all, the total factor energy efficiency and carbon emission performance of CDM host countries appear much lower than those of investment countries. Second, the technology gap of energy-use and carbon emissions reduction between CDM host and investment countries is significant. Finally, with the increase of total factor energy efficiency and carbon emission performance in CDM host countries, the impact of CDM projects on their energy efficiency is always negative, and that on their carbon emission performance gradually varies from positive to negative, meaning that CDM projects are not necessarily helpful to improve the energy efficiency and carbon emission performance in host countries.