Title: Efficiency analysis of coal-based thermal power generation in India during post-reform era

Authors: K.R. Shanmugam, Praveen Kulshreshtha

Addresses: Madras School of Economics, Behind Government Data Centre, Gandhi Mandapam Road, Chennai 600 025, India. ' Department of Humanities and Social Sciences, Indian Institute of Technology, Roorkee 247 667, Uttaranchal, India

Abstract: Coal-based thermal power stations are the leaders in electricity generation in India. This study employs the stochastic frontier production function methodology for panel data to measure the technical efficiency (TE) of coal-based thermal power plants in India during 1994-1995 to 2001-2002. Efficiency varies widely across plants and regions, while the TE is time-invariant. The average TE is approximately 73%, indicating a substantial scope for increasing thermal power generation in the country, with improved application of existing technology and without employment of additional resources. The western region is technically more efficient than other regions and young plants are more efficient than their old counterparts. We hope that the findings will prove useful to development agencies and policy-makers in devising appropriate strategies to improve electricity generation in India.

Keywords: panel data; stochastic frontier; technical efficiency; thermal power; India; coal based power stations; electricity generation; energy efficiency.

DOI: 10.1504/IJGEI.2005.006408

International Journal of Global Energy Issues, 2005 Vol.23 No.1, pp.15 - 28

Published online: 03 Mar 2005 *

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