Measuring ecological total-factor energy efficiency incorporating regional heterogeneities in China

This paper proposes a metafrontier slack-based efficiency measure (MSBM) approach to model ecological total-factor energy efficiency. This new advanced approach incorporates group heterogeneities of regions, total slacks, and undesirable outputs simultaneously into energy efficiency analysis. We incorporate global environmental technology into the proposed model so as to improve its discriminating power. We conduct an empirical analysis of regional ecological energy efficiency by incorporating carbon dioxide (CO2) and sulfur dioxide (SO2) emissions and the chemical oxygen demand (COD) of China during 2001-2010. The results indicate that most of the provinces are not performing at high ecological energy efficiency. Significant regional technology gaps in ecological energy efficiency exist in three areas. We present some policy suggestions based on the empirical results.