Comparative analysis of Azerbaijan’s energy sector efficiency trend at the current development stage

Methodological and practical aspects of the energy sector efficiency trend in various countries of the world and Azerbaijan for 2013-2017, based on the methodology presented by the World Economic Forum (WEF), are analyzed and considered in the paper. The basis of the methodology for evaluating the effective energy sector performance is the use of an energy triangle, where the vertices are Economic growth and development, Environmental sustainability and Energy access and security, where a set of indicators with their own weighting coefficients is used to evaluate each of subsystems. Naturally, the number of indicators and the weighting coefficients are adjusted in time in order to fully take into account all the features of the energy sector. The Azerbaijan’s energy sector efficiency values for the period under review, taking into account all available indicators, are re-calculated, due to this fact the Azerbaijan’s place in the world’s ranking of countries has moved several positions higher.


Introduction
The basis of the methodology for evaluating the effective energy sector performance is the use of an energy triangle, where the vertices are Economic growth and development, Environmental sustainability and Energy access and security, where a set of indicators with their own weighting coefficients is used to evaluate each of subsystems. Naturally, the number of indicators and the weighting coefficients are adjusted in time in order to fully take into account all the features of the energy sector [1][2][3][4][5][6].

Energy Architecture Performance Index of World
For comparative analysis of changes in the Energy Architecture Performance Index for 2013-2017, the countries of the world were grouped into seven regions, for which the corresponding relationships were constructed [2]. The relationships of the Energy Architecture Performance Index subsystems of the European Union countries are shown below.
As is obvious from Figure 1, during the period under review, all 3 components of the energy sector efficiency in European countries have a positive growth trend, where the greatest growth is observed in the Environmental sustainability subsystem-17%, Energy access and security subsystem-11%, Economic growth and development subsystem -6%. At the same time, the subsystem values themselves as of 2017 are as follows: for Environmental sustainability -0.7, Energy access and security -0.82, Economic growth and development -0.61.

Fig. 1. Energy Architecture Performance Index of EU
In general, the energy sector efficiency in European countries increased by 11%.
The curves for subsystems of efficient energy sector performance for the North America countries are shown in Figure 2. As is obvious from the figure, the Environmental sustainability subsystem has increased by 20% compared to 2013, Energy access and security by 10%, and Economic growth and development by 4%.
The subsystem values themselves as of 2017 are as follows: for Environmental sustainability subsystem -0.63, Energy access and security subsystem -0.66, Economic growth and development subsystem -0.53.  On the whole, the energy sector efficiency for the North America countries increased by 12%.
The energy sector performance efficiency subsystems curve for Middle East & North Africa is presented in Figure 3. Unlike the EU and North America countries, , the largest growth in the Middle East & North Africa countries is observed in the Economic growth and development subsystem, which is 18%. Low growth is observed in Environmental sustainability and Energy access and security subsystems, 7% and 2% respectively. These subsystem values as of 2017 are as follows: Economic growth and development -0.39, Environmental sustainability -0.38, Energy access and security-0.71.
On the whole, the energy sector efficiency for the Middle East & North Africa countries increased by 7%.
A different picture is observed in the BRICS countries. Although some drop of the Environmental sustainability subsystem value occurred in 2014, as shown in Figure 4, in 2015 it recovered up to 0.54 and remained practically constant during the last several years. Slight growth is also observed in the other two subsystems.

Fig. 4. Energy Architecture Performance Index of BRICS
In general, the energy sector performance efficiency of the BRICS countries also has a low growth compared to 2013-7%.
In the ASEAN countries, slight growth is observed in the Economic growth and development subsystem by 16% and in the Environmental sustainability subsystem by 15%, as is obvious from Figure 5. At the same time, the subsystem values themselves as of 2017 are as follows: Sustainability environmental sustainability -0.57, Energy access and security -0.70, Economic growth and development -0.52.

Fig. 5. Energy Architecture Performance Index of ASEAN
In general, the energy sector performance efficiency for the ASEAN countries increased by 11% compared to 2013.
Among the 7 regions considered, the most significant growth in the Economic growth and development and Energy access and security subsystems of effective energy sector performance is observed in the Sub-Saharan Africa countries, 24% and 33% respectively. At the same time, the subsystem values themselves in the Sub-Saharan Africa countries are still low compared to other regions, 0.47 and 0.39 respectively (Fig. 6). On the whole, the energy sector performance efficiency in the Sub-Saharan Africa countries also has the highest indicator among 7 regions, which has increased by 20% compared to 2013.
In CIS countries, as is obvious from Figure 7, there is relatively small but steady growth in all subsystems. In 2014 a significant decline of the value to 0.48 happened in the Environmental sustainability subsystem, and some decline also has occurred in the Economic growth and development subsystem to 0.36, which led to the decrease in the score to 0.51. On the whole, the energy sector performance efficiency in CIS countries increased by 7%.
Analyzing all regions, one can reach a conclusion that small but steady growth is observed in all subsystems of the energy sector performance efficiency. As is obvious from all the above curves and as shown in

Energy Architecture Performance Index of Azerbaijan
Similar studies have been conducted to determine the efficiency of Azerbaijan's energy sector performance [7][8][9].
As is obvious from Figure 9, during the period under review in 2013-2017, the efficiency of Azerbaijan's energy sector performance according to calculations of the World Economic Forum on the whole showed an increase of 14%, while the "Economic growth and development" subsystem grew by 38%, the "Environmental sustainability" subsystem by 12%, and "Energy Availability and security" by 1%.
It should be noted that according to the same calculations, the numerical values of the Energy Architecture Performance Index of Azerbaijan on the whole as of 2017 are 0.67, and for the subsystems are 0.65, 0.57 and 0.79 respectively. During the analysis it was found that the research of the World Economic Forum was incomplete, since the values of some indicators for evaluating the values of individual subsystems are not available, which led to inaccuracies in the assessment of both individual subsystems and the resulting value of the efficiency of the energy sector performance of Azerbaijan.
Below are curves of some indicators included in the subsystems of energy performance efficiency in Azerbaijan.
The chart of Energy intensity indicator, which is part of the Economic growth and development subsystem, is presented in Figure 10. As is obvious from the chart, the Energy intensity indicator value in 2018 increased almost by 25% compared to 2010. It should be noted that this occurred mainly due to diversification of economy and sustainable development of non-oil sector [10-14]. Another indicator from the Economic growth and development subsystem is Electricity prices for industry (US$ per kilowatt-hour), which is not taken into account in the WEF report.

Fig. 11. Electricity tariff in Azerbaijan
The "Electricity prices for industry' for Azerbaijan is presented in the Figure 11. As is obvious from the figure, since 2016 the price of electricity for industry has dropped by almost 25% from $ 0.07 per kWh to $ 0.053 per kWh, indicating a high level of this indicator.
Another indicator of this subsystem is cost of Energy imports (% GDP). As a result of the formal approach, the value of this indicator in the WEF report is shown as 0.28, which worsens the resulting value of the subsystem under consideration. Analysis of the Energy imports indicates that the import of energy resources in Azerbaijan has increased in recent years (2016-2018) due to the increase in natural gas import. The energy balance of natural gas of Azerbaijan is shown in Table 1. As is obvious from the Table 1, natural gas is imported not for domestic consumption of Azerbaijan, but to fulfill international obligations for its export, actually the imported natural gas is transit. It should be noted that because of this also the state of the Value of energy exports indicator (%GDP) worsens, which in the WEF report for 2017 is indicated as 24.97%, but actually it should be less.
Charts for some indicators included in the Environmental sustainability subsystem are given below. The chart for "Nitrous oxide emissions in energy sector" indicator, included in the Enviromental sustainability subsystem, is presented in Figure 12. As is obvious from the chart, the value of this indicator has significantly decreased in recent years, although there is some growth in 2017-2018.  The value of the "CO2 emissions from electricity" indicator in Figure 14 tends to decrease slightly, which is mainly due to the greater use of more efficient power plants for power generation. In the WEF report the Energy access and security subsystem is evaluated using 6 indicators. The most important for Azerbaijan are indicators Quality of electricity supply, Percentage of population using solid fuels for cooking and Diversity of total primary energy supply (Herfindahl Index). As shown above, energy resources imports mainly reflect the natural gas import, which is exported and actually is transit. Therefore, the values of the Import dependency and related Diversification of Import Counterparts indicators are calculated formally, and are not particularly important for evaluating the Energy access and security subsystem in Azerbaijan.
Percentage of population using solid fuels for cooking in Azerbaijan is presented in Figure 15. As is obvious from the figure, this indicator is in a very high level, conforming to gasification level in the country, although the value of this indicator in the WEF report is significantly worse. Taking into account all available indicators included in the system of indicators for evaluating individual subsystems of energy performance efficiency in Azerbaijan, the values of energy sector performance subsystems were recalculated and their updated values were determined: for 2017 for the Economic growth and development subsystem-0.68, for the Environmental sustainability subsystem-0.62, for the Energy access and security subsystem-0.8, while the Overall score was 0.7 The energy triangle "Energy Architecture Performance Index of Azerbaijan" for 2017 with updated values of subsystems is presented below in Figure 16 [15].