Understanding drivers of energy efficiency changes in China

Huibin Du, Daniel C. Matisoff, Yangyang Wang and Xi Liu

Applied Energy, 2016, vol. 184, issue C, 1196-1206

Abstract: Under a total-factor framework, this manuscript constructs a slacks-based measure data envelopment analysis (SBM-DEA) model and an index of total-factor energy efficiency (TFEE) to investigate the energy efficiency of the 29 provincial-administrative regions (PARs) in China during 1997–2011. Applying spatial panel data models to explore the regional clustering and influential factors of energy efficiency in China’s 29 provincial-administrative regions during 1997–2011, results show that China experienced a continuing increase in energy efficiency during the sample period. In addition, we find evidence of the diffusion of energy efficiency improvements. Research and development investment, particularly when interacted with increases in energy prices, and when government intervention is low, are a powerful drivers of efficiency improvements. We illustrate heterogeneous impacts across Chinese regions. Income gains in more industrialized provinces and education gains in less industrialized provinces also produce efficiency improvements. In contrast to existing literature, we do not find responsiveness to changes in energy prices, growth rates, or income per capita in less industrialized regions. These results highlight the uniqueness of the Chinese experience and warrant more in-depth exploration of the drivers of energy efficiency in China.

Keywords: Energy efficiency diffusion; Data envelopment analysis; Spatial panel data (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (24)

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DOI: 10.1016/j.apenergy.2016.05.002

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