The drivers and barriers of energy efficiency

Abstract

Energy efficiency is “the first fuel” due to its abundant availability and low cost in terms of supply, based on the IEA. The primary energy intensity was often employed to measure energy efficiency. Among 46 countries, the improvement of energy efficiency from 2000 to 2020 ranged between 61.54% and −3.16%, suggesting the situation and influence factors of energy efficiency may be different across countries. To systematically find the drivers and barriers of energy efficiency, panel regression models were built. The variation of energy efficiency can be explained by not only the traditional GDP and structure effects in the decomposition methods, but also the weather, trade, and infrastructure effects. For the heterogeneous countries, the average performer, instead of the best one in the data envelopment analysis, was compared. Estimated results indicated that key drivers of energy efficiency were the growth of GDP, increases of renewable energy, and electrification. The global warming decreased heating degree days and increased cooling degree days, causing the climate factors partially offset each other. Other factors of the energy efficiency improvement included the industrial transformation, trade openness, and increasing population. These influences were different across countries; thus, the country-specific routes of energy efficiency improvement were found.