Drivers of Energy Efficiency in German Manufacturing: A Firm-Level Stochastic Frontier Analysis

Abstract

Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW. Drivers of Energy Efficiency in German Manufacturing December 2017 AbstractIncreasing energy efficiency is one of the main goals in current German energy and climate policies. We study the determinants of energy efficiency in the German manufacturing sector based on official firm-level production census data. By means of a stochastic frontier analysis, we estimate the cost-minimizing energy demand function at the two-digit industry level using firm-level heterogeneity. Apart from the identification of the determinants of the energy demand function, we also analyze potential drivers of energy efficiency. Our results suggest that there is still potential to increase energy efficiency in most industries of the German manufacturing sector.Furthermore, we find that in most industries exporting and innovating firms as well as those investing in environmental protection measures are more energy efficient than their counterparts. In contrast, firms which are regulated by the European Union Emissions Trading System are mostly less energy efficient than non-regulated firms.

Financing innovation and enterprises’ efficiency of technological innovation in the internet industry: Evidence from China

“…Many scholars [13][14][15][16] consider R&D efficiency and innovation performance as part of technological innovation efficiency. The logarithm value of the sum of invention and patents is generally used to represent innovation performance, but this method has not been standardized [17,18]. It is important to standardize the important technology and service protection system of Chinese internet companies [9], rather than relying on simple summation.…”

“…This approach can be used to assess the fitting quality of the model and provide various statistical test values. To improve the accuracy of efficiency estimation, the SFA method is widely used to measure random errors and invalid rate terms [17,18]. SFA fully considers the interference of random factors, resulting in greatly improved measurement accuracy.…”

Do Energy Efficiency Networks Save Energy? Evidence from German Plant-Level Data

“…For example, accounting for endogeneity through the use of instrumental variables, Roy and Yasar (2015) find that exporting leads to lower fuel consumption relative to electricity use for Indonesian firms. Using the same dataset on German manufacturers as this paper, Lutz et al (2017) show that exporting firms are more energy efficient than their counterparts.…”

“…Moreover, exporting may improve management practices (Bloom and Van Reenen, 2010), which in turn may have positive spillovers on energy efficiency Martin et al, 2012;Boyd and Curtis, 2014). Exporting German manufacturers in particular have been found to be more energy efficient than their non-exporting counterparts (Lutz et al, 2017).…”

Examining the Industrial Energy Consumption Determinants: A Panel Bayesian Model Averaging Approach

“…Moreover, they showed that energy policy, funding schemes, and administrative structures play an import role in the energy transition of modern communities. Lutz et al [32] demonstrated that exporting, innovation, as well as environmental protection industries are more energy efficient than others. Sun and Anwar [33] explored the relationship between electricity consumption, industrial production, and entrepreneurship in Singapore's manufacturing sector.…”