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

Author

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  • Sushama Murty

    (Jawaharlal Nehru University)

  • Resham Nagpal

    (Jawaharlal Nehru University)

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.

Suggested Citation

  • Sushama Murty & Resham Nagpal, "undated". "Measuring output-based technical efficiency of Indian coal-based thermal power plants: A by-production approach," Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi Discussion Papers 18-07, Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi, India.
    • Handle: RePEc:ind:citdwp:18-07
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    1. Sushama Murty & Resham Nagpal, "undated". "Choice of models for emission-generating technologies and designing technical efficiency improvements," Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi Discussion Papers 19-01, Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi, India.
    2. Finn R. Førsund, 2021. "Performance measurement and joint production of intended and unintended outputs," Journal of Productivity Analysis, Springer, vol. 55(3), pages 157-175, June.
    3. Sushama Murty & Resham Nagpal, "undated". "Weighted index of graph efficiency improvements for a by-production technology and its application to Indian coal-based thermal power sector," Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi Discussion Papers 18-08, Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi, India.
    4. Førsund, Finn, 2019. "Environmental Performance Measurement: The Rise and Fall of Shephard-inspired Measures," Memorandum 9/2019, Oslo University, Department of Economics.
    5. Sushama Murty & Resham Nagpal, "undated". "Measuring marginal abatement costs in the Indian thermal power sector: A by-production approach," Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi Discussion Papers 19-06, Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi, India.
    6. Sushama Murty & R. Robert Russell, 2021. "A commentary on “Performance measurement and joint production of intended and unintended outputs” by Finn Førsund," Journal of Productivity Analysis, Springer, vol. 55(3), pages 177-184, June.

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