Revenue efficiency of bioenergy industry: the case of European Union (EU) member countries

Abstract

Bioenergy plays a crucial role in numerous sectors such as industry, electricity, heating, cooling, and transportation. Previous research on bioenergy focused on the production and strategies to improve bioenergy development and distribution in the EU. This study computes the revenue efficiency level and investigates the economic determinants of revenue efficiency of the bioenergy industry in EU28 countries between 1995 and 2018. The study employed the nonparametric data envelopment analysis method to compute the revenue efficiency level, and ordinary least squares, random effects, and fixed effects models were applied to investigate the determinants of revenue efficiency. The results show that most of the countries are efficient, given a high-efficiency score, with France, Malta, Sweden, and Slovakia as the most efficient, while Cyprus is the least efficient. Furthermore, empirical results indicate that capital and labor have a negative impact, while GDP and the size of biomass have positive and significant impact on revenue efficiency of the bioenergy industry in EU28 countries during the period studied. This study provides an insight for bioenergy policymakers and investors-to the understanding of the impact of revenue efficiency on the sustainability of the bioenergy industry.