A Way Forward for Energy Pricing and Market Reforms to Reduce Emissions: The Case of the Top 10 Carbon Dioxide-Emitting Countries

Abstract

The purpose of the current study was to assess energy, economic, and environmental efficiency based on the environmental reforms of the top 10 carbon dioxide (CO2) emitter countries by using the Data Envelopment Analysis (DEA) model from 2013 to 2017 to assess energy pricing and market reforms from the perspective of emission reduction. The results revealed that the Russian Federation has the highest score for energy intensity while Saudi Arabia is effective in terms of CO2 emissions. In the absence of market reforms, the level of non-fossil fuel technology development incentives will require a relatively low carbon price (about US$3.53/ton CO2) by 2020. From 1995 to 2000, countries indexed the price of liquid petroleum products to the international market price. The energy sector will account for 52% of the total and the effect on CO2 emissions will be about a 1.6% reduction in energy-related emissions in 2020 as a result of reducing subsidy spending, keeping fiscal deficits below 3%, and reducing the slowdown in economic growth. Research should revisit energy prices with subsidy reforms in favor of renewable energy and tax on fossil fuel.