بهره وری انرژی و جایگزینی سرمایه - انرژی: شواهدی از چهار کشور سازمان اوپک

Rapid economic growth and development in several oil-exporting developing countries have led to increasing energy consumption and the accompanying greenhouse gas (GHG) emissions. Consequently, a good understanding of the nature and structure of energy use in developing economies is required for future energy and climate change policies. To this end, a modified translog cost function is employed in this paper to estimate energy efficiency for selected members of the Organization of the Petroleum Exporting Countries (OPEC) over the period 1972–2010. This also allows for the estimation of energy-capital substitutability, which arguably reflects the likely ease/disruption to long-term growth arising from policy measures aimed at reducing energy consumption and GHG emissions. The estimated results show that energy efficiency gains range from −14% to 13% for sampled countries. Furthermore, factor substitution elasticities suggest that energy and capital are substitutes in Algeria and Saudi Arabia, but are found to be complements in Iran and Venezuela. The insight generated by this study is that, over the last four decades, energy efficiency improvements in selected OPEC countries are modest, possibly reflecting a “subsidy effect” arising from artificially low energy prices. Thus, policy makers should take note that measures aimed at conserving energy need to internalize the environmental cost arising from energy consumption using pricing and fiscal instruments such as carbon taxes.

OPEC total energy consumption increased by 685% between 1970 and 2010. 1Similarly, CO2 emission from the burning of fossil fuels rose by 440% during the same period. Thus, both energy consumption and CO2 emissions have risen rapidly over time. In particular, total emissions data for all OPEC countries indicate that they accounted for around 7% of global CO2 emissions in 2010, which is significant in the context of the future energy use and GHG emissions potential of OPEC countries. Given the foregoing, it is clear that the energy consumption trajectory of OPEC countries has serious implications for global warming which is one of the most critical issues facing mankind today. There is a well-established notion in literature2 that the main source of global warming is GHG emissions, which in turn is by-product of energy consumption. Therefore, policy makers and governments around the world have focused great attention on devising measures to tackle this problem by stimulating energy efficiency improvements in order to achieve energy conservation and hence reduce energy consumption and the resulting greenhouse emissions. This view about the role of energy efficiency gain in reducing energy use and emissions is highlighted by a report from a United Nations climate report [45] which states inter alia: “World governments should exploit energy efficiency as their energy resource of first choice because it is the least expensive and most readily scalable option to support sustainable economic growth, enhance national security, and reduce further damage to the climate system”. Fig. 1 shows the rising historical trend in energy related CO2 emissions attributable to sampled OPEC countries. In particular, given the outlook to the 2020 CO2 emissions targets, and the ongoing climate change talks, the global climate change agenda requires adequate and reliable information on energy efficiency contributions in developing countries, of which OPEC countries represent a significant bloc. This is underscored by OPEC’s submission in its Jan 2013 bulletin [37] on climate change: Full-size image (50 K) Fig. 1. Historical CO2 emissions. This contains four panels (one for each sampled country) of CO2 emissions over the study period. Figure options “For its part, OPEC is committed to investing in state-of-the-art applications that are helping in the environment presenting solutions for cleaner oil products and groundbreaking processes, such as CCS, which deal with harmful emissions”. Therefore, in order to design effective energy and climate policies, a clear and precise understanding of the possible role of energy efficiency in restricting energy consumption in oil-exporting developing countries’ is needed. In spite of the rapid rise in energy consumption of OPEC countries, most energy efficiency studies3 have focused on OECD and other developed economies of the world (Zhou et al. [49], Filippini and Hunt [13] and [14], Fare et al. [12], Hoang and Alauddin [24]). It is arguably important to also explore the role that energy conservation may play in curtailing energy consumption in developing countries, given their increasing energy use, arising from rapid economic growth and urbanization. In particular, given the dominance of fossil fuels in the macro economy of OPEC countries, 4increasing energy demand in these countries will result in higher GHGs emissions overtime. For instance, in comparative terms, OECD energy consumption rose by 63% between 1970 and 2010, compared to 685% increase in OPEC energy consumption. Similarly, OECD emissions increased by 25% over the same period, compared with 440% for OPEC. Based on the foregoing, fossil rich developing countries clearly have great ramifications for future energy and climate policies. Several previous studies have attempted to analyze energy use in OPEC countries, with emphasis on price and income elasticities and the causality between energy use and other macroeconomic aggregates such as GDP (growth), greenhouse emissions, employment and so forth. One of the earliest studies of energy use in OPEC countries is Al-Janabi [1] who conducted a time series analysis and forecast for the demand for hydrocarbons in OPEC countries with a view to evaluating the implications of domestic demand trends for future exports capacities. Sari and Soytas [39] investigated the linkages between CO2 emissions, economic growth, energy consumption and employment in selected OPEC countries, with emphasis on the relationship between energy consumption and growth. Similarly, other studies such as Al-Iriani [3] and Mehrara [35] have also explored the question of causality between energy consumption and income/economic growth. Squalli [44] also estimated and found evidence of long-run relationship between electricity demand and economic growth of OPEC countries using bound test and causality approach. In terms of country studies, Zamani [47] explored the causality between GDP, industrial and agricultural value added and consumption of different fossil fuels, applying the vector error correction model to data for 1967–2003. More recently Gately et al. [17] analysed the rapid growth in domestic oil consumption across OPEC countries for the period 1971–2010 using panel cointegration techniques, showing that a massive 700% increase in energy use over the last 4 decades has now pushed OPEC energy consumption to almost equivalent levels to China’s oil consumption. More importantly, they found that the annual oil consumption growth of 5% outstrips the 3% average economic growth, implying the curtailment/downward outlook of future export capacity in the face of modest production. Notwithstanding the crucial importance of OPEC energy use, attempts at explaining the possible role of energy efficiency in reducing their energy consumption are limited. Thus although previous studies have explored or investigated energy use in OPEC countries, most of them have focused on the relationship between energy use and factors such as income/output and environmental pollution, 5with very little done to explain energy conservation in these countries. Only a few studies have explored the issue of technical progress or energy efficiency in OPEC countries. Even such studies appear to only simulate the likely impact of potential (or assumed) energy efficiency levels using scenario analysis. 6For instance, Davoudpour and Ahadi [11] developed scenarios for the impact of price reform and energy efficiency improvement on greenhouse emissions for Iranian households over the period 2000–2010. They show that low end-use fuel prices convey low consumer incentive for energy efficiency improvement. By combining an econometric demand model of electricity with scenario based techniques, they show that a business as usual approach to energy use will result in 7.5% and 6.85 rise in energy demand and CO2 emissions respectively, whereas a price increase to comparable levels as those paid across the border, combined with energy efficiency programs will yield 4.94% and 3.1% decreases in energy use and CO2 emissions respectively. Gately [15] also conducted a scenario analysis of OPEC’s future export capacity, demonstrating that OPEC as a whole will require a 60% increase in production by 2030 in order to accommodate energy consumption levels and sustain its share of global oil export. Similarly, Naderian [36] evaluated the potential role of energy efficiency in the intensity reduction potential of OPEC countries by simulating future energy scenarios up to 2020, 7rather than estimate the magnitude of energy efficiency from OPEC energy data. Another issue which appears to have been overlooked is that of factor substitution. This is important, given that information on elasticity of substitution between factor inputs conveys useful information on the ease or difficulty of factor replacement, especially in times of shocks to the production process or input markets. For instance, specifically in terms of OPEC, it would be useful to know how well producers will adjust to in response to the removal of subsidies on end-use energy. This information can be retrieved from substitution elasticities. As far as is known, the number of studies estimating (rather than simulating) energy efficiency and factor substitution in OPEC countries is limited, in spite of the possible contribution of energy efficiency improvements in developing countries. This importance is underscored by the relatively reasonable number of studies8 on other leading energy consuming developing countries such as China. For instance, Choi et al. [7] employed the non-parametric DEA to estimate energy and CO2 efficiency using provincial Chinese data for 2001–2010. The issue of factor substitutability has also been explored by Smyth et al. [43] who estimated a translog production function using data on the Chinese iron and steel sector for the period 1978–2007. Zha et al. [48] employed a translog cost function to evaluate technological change and factor-substitutability for the electricity sector in China for 1985–2007. Hence considering this gap, a top-down macroeconomic analysis of the impact of energy conservation (via energy efficiency gains) on energy use in OPEC countries is timely. Amongst other benefits, this will equip policy makers with adequate knowledge about the nature and evolution of energy efficiency gains in resource-rich developing countries, which arguably have significant implications for the global energy policy agenda. Moreover, when designing energy measures aimed at curtailing energy use, policy makers are concerned about the economic impact of such energy policy measures, which may be captured by the substitution elasticities between energy and other factor inputs (see [41] and [42]). Hence, such an assessment is very useful and relevant in practical energy policy formulation, in addition to sound and reliable estimates of energy efficiency. To achieve these aims, this paper estimates a modified translog cost function. In short, the modeling exercise has two principal objectives. The first is to quantify energy efficiency savings over the sample period. The second objective is to critically assess the likely impact of domestic energy policy measures such as mandated efficiency gains or energy subsidy reduction on long term economic growth, via substitution elasticities. Unless this study is undertaken, the role of efficiency gains in reducing energy consumption and emissions by OPEC countries may remain unknown. Based on this study, climate policy makers and governments may be able to quantify the benefits of implementing efficiency measures. Moreover, by doing so, they are better able to map such gains against the cost of efficiency measures and policies. 9To achieve this, substitution elasticities are reported here, bearing in mind that the outcome (especially those relating to social cost and economic disruptions) of energy policy measures are reflected by the substitution between energy and other factor inputs (see for instance [4] and [42]). Moreover, the substitution possibilities between energy and other factors can be used to derive implications for increasingly scarce energy resources.

This paper has attempted to estimate energy efficiency gains in selected OPEC countries using a modified translog cost function. First, we show that the modified translog cost specification employed in this study is a robust approach to estimating energy efficiency gains in the energy input. Secondly, and more importantly, we show that on the average, efficiency gains across sample countries are either negative or at best modest over the estimation period. The negative energy efficiency gain observed for Iran and Venezuela possibly reflect a subsidy effect, with energy subsidization rate of 70% and 80.5% respectively, compare to 50.7% in Algeria. 21Given that end-use energy prices are significantly subsidized in OPEC countries, the relatively lower prices act as a disincentive to install efficient technologies and consequently may reduce the propensity to lower GHG emissions. Arguably, a significant proportion of energy efficiency derives from higher energy prices. For instance, Hunt et al. [25] show that in the long-run, energy consumption responds to rising energy prices via the installation of more energy efficient technologies. Other studies ([16], [19] and [30]) have also shown that energy efficiency has a price effect component. The findings presented here have implications for the wider climate change agenda, especially pertaining to countries relying heavily on natural resource export. By extracting as much insight as possible from available data, it is shown here that, unless some form of price and fiscal interventions22 are adopted in OPEC countries, 23future energy consumption and GHG emissions from these countries will pose significant challenges to climate change management in the future. In effect, based on these results, any meaningful attempt at conserving energy in these countries should internalize the negative externality arising from GHG emissions i.e. end use energy prices ought to reflect the opportunity cost arising from resource extraction and the marginal damage cost of energy use. Furthermore, it is shown that conservation policy measures are likely to have greater disruptive impacts on Iran and Venezuela. To derive greater insight, future research should attempt to disaggregate energy efficiency measures for end-use services (such as transport, cooling, and heating) and sectoral energy uses (residential, industrial and electricity). It is very likely that such bottom-up studies will shed more light on the country-specific heterogeneous drivers of (in) efficiency across countries. In addition, future studies of energy efficiency in OPEC countries should attempt to quantitatively assess the precise impact of end-use energy subsidies (which directly affect energy prices) on energy efficiency improvements, considering the role of end-use energy prices as a major source of endogenous technical progress. By extension, since higher energy prices via subsidy removal may be interpreted as partly internalizing the environmental cost of pollution arising from energy use, such a study would be useful in unraveling the extent to which a change in government fiscal strategy may help to cut carbon emissions in OPEC countries. Finally, this study contributes to the direction of future research on energy and climate policies pertaining to OPEC countries (and other non-OPEC oil exporting countries). First, results obtained in this study indicate that climate change policies aimed at curbing energy consumption via fiscal instruments (such as energy taxes and prices) or mandated efficiency standards may have varying disruptive effects on economic growth, as shown by the different substitution elasticities obtained here. Consequently, energy use and energy efficiency studies should endeavor to estimate the substitution elasticities between energy and other factor inputs in order to precisely account for the ease/difficulty of macroeconomic shocks arising from energy policy instruments or measures aimed at conserving energy. For instance, it should now be clear to energy policy makers that a ‘one size fits all’ approach to energy policy design may yield different outcomes in different OPEC countries as shown by the different energy-capital substitutability across sample countries.