Measuring Total-factor energy efficiency and energy saving potential in Asian economies: application of Stochastic Frontier Analysis

This paper analyzes the total factor energy efficiency and the energy saving potential of the 37 Asian economies using the energy-input stochastic frontier model based on the assumption of the trans-log production function during the period of 1980-2011. The empirical results indicate that Srilanka, Macao, Vietnam, Philippine and India perform the best in terms of energy efficiency, whereas Kuwait, Qatar and the Bahrain perform the worst during the entire research period. The results also show that the total of the energy saving potential for Asian economies, is 2733.34 million ton oil equivalent which is more than 40% of total energy consumption by all countries. The energy saving potential in Iran, 131.21 investigated, that is larger than the overall energy consumption of 29 countries such as Pakistan, Turkey, Singapore and Malaysia but lesser than China, Russia, India, Japan, Korea, Saudi and Indonesia. Generally speaking, there is much space to improve energy efficiency of Iran and many Asian economies.