Measuring output-based technical efficiency of Indian coal-based thermal power plants: A by-production approach

Sushama Murty () and Resham Nagpal ()
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Resham Nagpal: Jawaharlal Nehru University

Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi Discussion Papers from Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi, India

Abstract: The by-production approach is employed in conjunction with data from the Central Electricity Authority (CEA) of India to compute the output-based F¨are, Grosskopf, Lovell (FGL) eciency index and its decomposition into productive and environmental eciency indexes for the Indian coal-based thermal power plants (ITPPs). We show that given (i) the aggregated nature of data on coal reported by CEA (ii) CEA’s computation of CO2 emissions through a deterministic linear formula that does not distinguish between different coal-types and (iii) the tiny share of oil in coal-based power plants, the computed output-based environmental eciency indexes are no longer informative. Meaningful measurement of environmental eciency using CEA data is possible only along the dimension of the coal input. Productive eciency is positively associated with the engineering concept of thermodynamic/energy eciency and is also high for power plants with high operating availabilities reflecting better management and O&M practices. Both these factors are high for private and centrally-owned as opposed to state-owned power-generating companies. The example of Sipat demonstrates the importance of (ultra)supercritical technologies in increasing productive and thermodynamic eciencies of the ITPPs, while also reducing CO2 emitted per-unit of the net electricity generated.

Pages: 40 pages
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Citations: View citations in EconPapers (6)

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