3. Reducing Energy Costs in European Union Farms: Analysis of Efficiency

Efficiency in the use of resources is one of the most adjusted approaches towards achieving sustainable development in any economic sector, including agriculture. In fact, the current challenges surrounding the global farming sector are to maintain, or even, in some circumstances, increase production in such a way that it is compatible with the increasingly desirable goals for decarbonisation. Amongst the resources which are critical for sustainability within the agricultural sector, one of the most significant is energy, considering the needs of this resource to generate numerous farming production factors and the energetic requirements for its various activities. This is particularly important in the regions and countries in the European Union, due to the variety of contexts and the framework of the European agricultural policies, where the design of adjusted policy instruments is always a great task. In this way, the main objective of this research is to analyse farming efficiency in European Union agricultural regions, over the period 2013–2018. Considering this objective, data from the European Union Farm Accountancy Data Network were considered and first analysed through factor-cluster assessment, to obtain homogenous decision-making units, and then through data envelopment analysis. For the data envelopment analysis, a model with the inverse of the energy costs as output was considered. The main findings show that the savings in energy costs in European Union farms have impacts on the output as well as on other inputs.