(248c) Assessment of the Environmental Efficiency of the Electricity Mix of the Top European Economies Via Data Envelopment Analysis

Moving towards a more sustainable energy system is a major goal of modern societies that aim to minimize the dependence on fossil fuels and the associated anthropogenic impacts. Energy transition, in particular, has recently received increasing public attention because of the role it plays in sustainability.

In this work, Life Cycle Assessment (LCA) and Data Envelopment Analysis (DEA) are combined to analyse the environmental performance of the electricity mix of the 27 wealthiest European economies. As output, we consider the electricity production of 1 kWh, while the environmental impacts (undesirable outputs) associated with the mix  are considered as inputs. The DEA model is named after the respectative researchers who first introduced it: the Charnes Cooper Rhodes (CCR) model (Cooper et al., 2007). The results obtained by applying the input-oriented CCR DEA(Dyckhoff and Allen, 2001)(Kuosmanen and Kortelainen, 2005) model combined with the CML 2001 LCA methodology to the raw data (without removing outliers) reveal that 8 countries are eco-efficient (efficiency equal to 1). These are Bosnia & Herzegovina, France, Ireland, Norway, Poland, Republic of Macedonia, Romania and Switzerland. On the other hand, 19 countries are inefficient (efficiency lower that 1), with some of them showing very low efficiency scores (like Germany, Finland, Spain and Sweden). After removing Norway and Poland from the analysis, both with very specific environmental patterns that differ from the rest (i.e., outliers), 16 countries are found to be eco-efficient and 9 inefficient. Bosnia & Herzegovina and Republic of Macedonia still appear as eco-efficient, as they do not use nuclear energy and therefore show very good performance in ionizing radiation. The inefficient countries are Belgium, Bulgaria, Croatia, Czech Republic, Finland, Hungary, Luxemburg, Slovakia and Spain. For the inefficient countries, we next determine how their electricity mixes should be modified so as to make them efficient. 

Our results provide valuable insight for policy makers on how to set environmental targets on electricity production. The proposed combined approach LCA/DEA can be very useful for governments and policy makers during the development of effective regulations that will ensure that the electricity demand is satisfied at minimum environmental impact.

LITERATURE

Cooper, W.W., Seiford, L.M., Tone, K., 2007. Data Envelopment Analysis, Data Envelopment Analysis: A Comprehensive Text with Models, Applications, References and DEA-Solver Software: Second Edition. Springer US, Boston, MA. doi:10.1007/978-0-387-45283-8

Dyckhoff, H., Allen, K., 2001. Measuring ecological efficiency with data envelopment analysis (DEA). Eur. J. Oper. Res. 132, 312–325. doi:10.1016/S0377-2217(00)00154-5

Kuosmanen, T., Kortelainen, M., 2005. Measuring Eco-efficiency of Production with Data Envelopment Analysis. J. Ind. Ecol. 9, 59–72. doi:10.1162/108819805775247846