Investigating the energy efficiencies of European countries with super efficiency model and super SBM approaches

Abstract

The scarcity of primary energy sources and depletion of the world’s fossil fuel reserves combined with wildly fluctuating energy prices in recent years have posed financial, cyclical, and environmental problems for European countries. These countries have a promising energy sector within the global energy markets, and measuring their technical efficiencies is of great importance. The goal of this study is to find and compare the efficiency scores of European countries and regions for the period of 2011–2015 using super efficiency and super slack-based measure (super SBM) data envelopment analysis (DEA) models. The empirical results revealed that efficiency scores of Eastern Europe, Baltic States, and the European Union-13 (EU-13) have remained lower than the efficiency scores registered for Northern Europe, Western Europe, Southern Europe, Scandinavia, and the European Union-15 (EU-15) for the same period. Besides, Greece, Luxembourg, Norway, and Denmark have been found efficient for the whole period. Additionally, SBM model analyses have shown better results in comparison to super efficiency approach. In conclusion, both the efficiency results and policy recommendations for the European countries and regions would provide valuable contribution to the decision-making processes in terms of energy policies.