Energies (May 2020)
Renewable Energy Utilization Analysis of Highly and Newly Industrialized Countries Using an Undesirable Output Model
Abstract
In the fight against climate change, the utilization of renewable energy resources is being encouraged in every country all over the world to lessen the emissions of greenhouse gases. However, not all countries are able to efficiently utilize these resources, and instead of providing solutions, the inefficient use of renewable energy may lead to even more damage to the environment. Data from eight countries belonging to the highly industrialized countries (HIC) group and nine from newly industrialized countries (NIC) group were used to evaluate the energy utilization of these groups. Factors such as total renewable energy capacity, the labor force, and total energy consumption were considered to be the input factors, while, CO2 emission and gross domestic product are the output factors. These factors were used to calculate efficiency scores of every country from 2013 to 2018 using the undesirable output model of Data envelopment analysis (DEA). The grey prediction model was also used to measure the forecasted values of the input and output factors for the year 2019 to 2022, and measure again the future efficiency scores of the HICs and NICs. The combination of grey prediction and DEA undesirable output model made this paper unusual and the most appropriate method in dealing with data that contains both desired and undesired outputs. The results show that the United Kingdom, Germany, France, and the United States continuously top the efficiency ranking among the HIC group, with a perfect 1.0 efficiency score from 2013 to 2022. Russia demonstrates the lowest score of 0.1801 and is expected to perform the same low-efficiency score in the future. Within the NIC group, Indonesia can be highlighted for performing with perfect efficiency starting from the year 2015 and even through 2022. Other NICs are performing at a very low-efficiency, with scores ranging from 0.2278 to 0.2734 on average, with Turkey displaying the lowest rank. This study recommends some useful strategies to improve the utilization of renewable energy resources such as improvements in the political and legal structure surrounding their use and regulation, tax incentives or exemptions to private power producers to encourage shifting away from conventional energy production, partnerships with non-governmental and international organizations that can provide assistance in managing renewable energies, strengthening of the energy sector’s research and development activities and long-term strategic plans for the development in renewable energy with considerations to the social, environmental, and economic impact on each country.
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