Economy & Business, Volume 8, 2014

Abstract: The energy sector receives considerable attention from both developed and developing countries. European countries, in addition to the fossil energy resources, are dependent on external energy resources, which pose a threat, as well. In addition, energy efficiency has played a significant role in the European countries’ economic growth, policy and export. Data envelopment analysis (DEA), a popular and useful mathematical method for decision makers, is used to analyze the efficiency levels of the decision-making units. The goal of this empirical study is to make a comparative energy efficiency analysis for the European countries. On the basis of the DEA analyses, CCR and BCC approaches have been applied to the European energy sector for the period of 2011-2012. In this regard, we have established an efficiency model that includes employment, the gross fixed capital formation (GFCF) and the primary energy consumption as the inputs, and gross domestic product (GDP) has been selected as the output. According to our results, Denmark, Ireland and Norway have demonstrated full efficiency for each year. In addition, the average efficiency scores in 2012 for the European countries have been demonstrated to be higher than those of 2011. We can conclude that the DEA technique could offer significant results to the analysis of the energy efficiency levels for the European countries.