Energy efficiency of Chinese service sector and its regional differences

The energy consumption of the service sector in China is larger than the total energy consumption of Japan, great importance should be attached to the energy efficiency of Chinese service sector. Considering undesirable output and regional heterogeneity, a meta-frontier slack-based efficiency measure (MSBM) approach is adopted in this paper to measure the energy efficiency of Chinese service sector using provincial panel data of China during 1995-2013. The empirical results show that, the energy efficiency of the service sector in China is 0.62 and 0.85 under meta-frontier and group-frontier technologies. The eastern regions show the best performance in energy efficiency, the central region follows and the western region shows the poorest performance. Only the eastern region shows an increasing trend in the energy efficiency of Chinese service sector. The potential of energy efficiency improvement for Hainan, Guizhou, Qinghai, Ningxia, Gansu and Shaanxi are relatively high. Some policy recommendations are proposed to improve the energy efficiency of Chinese service sector.