Regional Total Factor Energy Efficiency Evaluation of China: The Perspective of Social Welfare: Fid-Bau Portal

Regional Total Factor Energy Efficiency Evaluation of China: The Perspective of Social Welfare

Haixia Cai / Ruguo Fan

The energy resource is an essential input of economic growth, which has an important impact on the ecological environment and social welfare. From the perspective of social welfare, considering the radial and non-radial characteristics of different input and output indicators, and the inseparability of the energy input and undesirable output, this study employs the non-separable hybrid DEA (Data Envelopment Analysis) model to evaluate the total energy efficiency of Chinese provinces between 2012 and 2016. Furthermore, this study calculates the energy saving and emission reduction potentials of China. The results reveal that the average total factor energy efficiency in China from 2012 to 2016 is 0.694, which means that there are still 30.6% energy efficiency losses. There is great potential for China to save energy, reduce pollutant emissions, and increase the output of social welfare. There are great differences in the total factor energy efficiency among provinces. The average energy saving potential of the whole country is 60.5%. If the energy efficiency of all provinces can reach the frontier, the whole country can save more than half of the energy consumption. The highest national average emission reduction potential is SO₂, followed by dust, CO₂, and NO_X. The implication of the conclusion is that in the development of regional economy, we cannot sacrifice the social welfare and sustainable development and take the growth rate of GDP as the only objective. Different energy saving and emission reduction policies should be put forward according to the characteristics of different provinces.