Does European Union's Agricultural Support Contribute to Energy Efficiency of Dairy Farms?

The purpose of this research was to investigate whether the European Union's high amounts of construction and technology grants provided to dairy farms under The Instrument for Pre-accession Assistance for Rural Development (IPARD) program make a real contribution in terms of energy use and efficiency. The primary data of the study were obtained from Dairy Farms Supported (SDF) and Non-Supported (NSDF) by the IPARD program by using a questionnaire filled during the face-to-face interviews. The full count method was used to determine the 50 SDF while the Neyman allocation sampling method was used to determine the 100 NSDF. Energy indicators were used to evaluate the efficiency of input energy transformation into output and data envelopment analysis was used to calculate technical efficiency and pure technical efficiency. Unlike other studies in the literature, we analyzed energy efficiency of dairy farms in terms of the contribution of the EU supports. The results showed that SDF were more energy-efficient dairy farms with much better energy indicators and efficiency scores than NSDF. Productivity, benefit/cost ratios, and energy scores clearly show that EU grants given to dairy farms contribute to the efficient use of resources, including energy, increasing the competitiveness of dairy farms, and contributing to the rural area through energy efficiency and economic performance.