IDEAS home Printed from https://ideas.repec.org/a/eee/eneeco/v102y2021ics0140988321003935.html
   My bibliography  Save this article

Environmental efficiency analysis of China's coal-fired power plants considering heterogeneity in power generation company groups

Author

Listed:
  • Nakaishi, Tomoaki
  • Takayabu, Hirotaka
  • Eguchi, Shogo

Abstract

This study conducts an environmental efficiency analysis of 104 coal-fired power plants in China by simultaneously considering multiple undesirable outputs (CO2, SO2, NOx, and PM2.5 emissions) generated during the production process and the heterogeneity caused by differences between the five major power generation companies (Datang, Guodian, Huadian, Huaneng, and Power Investment). In the empirical study, slacks-based data envelopment analysis (DEA) was employed to investigate the “total” and individual CO2, SO2, NOx, and PM2.5 “specific” environmental inefficiency scores for each power plant. These scores allow us to identify which undesirable outputs are the main sources of total environmental inefficiency for each company and power plant. The results show that inefficient PM2.5 and SO2 emissions are the main sources of environmental inefficiency for many plants. Furthermore, a meta-frontier DEA decomposition framework is adopted to identify whether the source of total environmental inefficiency for each power plant is due to technological gaps between the five major power generation companies or managerial gaps within the same power generation company. The results imply that, in most cases, managerial gaps within the same power generation company account for a larger proportion of total environmental inefficiency for each power plant. These findings are used to provide comprehensive policy suggestions for government and corporate managers to improve the environmental efficiency of power plants.

Suggested Citation

  • Nakaishi, Tomoaki & Takayabu, Hirotaka & Eguchi, Shogo, 2021. "Environmental efficiency analysis of China's coal-fired power plants considering heterogeneity in power generation company groups," Energy Economics, Elsevier, vol. 102(C).
    • Handle: RePEc:eee:eneeco:v:102:y:2021:i:c:s0140988321003935
    DOI: 10.1016/j.eneco.2021.105511
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0140988321003935
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.eneco.2021.105511?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Long, Xingle & Wu, Chao & Zhang, Jijian & Zhang, Jing, 2018. "Environmental efficiency for 192 thermal power plants in the Yangtze River Delta considering heterogeneity: A metafrontier directional slacks-based measure approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 82(P3), pages 3962-3971.
    2. Shogo Eguchi & Hirotaka Takayabu & Mitsuki Kaneko & Shigemi Kagawa & Shunichi Hienuki, 2021. "Proposing effective strategies for meeting an environmental regulation with attainable technology improvement targets," Business Strategy and the Environment, Wiley Blackwell, vol. 30(7), pages 2907-2921, November.
    3. Dan Tong & Qiang Zhang & Steven J. Davis & Fei Liu & Bo Zheng & Guannan Geng & Tao Xue & Meng Li & Chaopeng Hong & Zifeng Lu & David G. Streets & Dabo Guan & Kebin He, 2018. "Targeted emission reductions from global super-polluting power plant units," Nature Sustainability, Nature, vol. 1(1), pages 59-68, January.
    4. Yang, Hongliang & Pollitt, Michael, 2009. "Incorporating both undesirable outputs and uncontrollable variables into DEA: The performance of Chinese coal-fired power plants," European Journal of Operational Research, Elsevier, vol. 197(3), pages 1095-1105, September.
    5. Zhao, Xiaoli & Ma, Chunbo, 2013. "Deregulation, vertical unbundling and the performance of China's large coal-fired power plants," Energy Economics, Elsevier, vol. 40(C), pages 474-483.
    6. Rolf Färe & Shawna Grosskopf & Carl A Pasurka, Jr., 2001. "Accounting for Air Pollution Emissions in Measures of State Manufacturing Productivity Growth," Journal of Regional Science, Wiley Blackwell, vol. 41(3), pages 381-409, August.
    7. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    8. W. Cooper & L. Seiford & K. Tone & J. Zhu, 2007. "Some models and measures for evaluating performances with DEA: past accomplishments and future prospects," Journal of Productivity Analysis, Springer, vol. 28(3), pages 151-163, December.
    9. Wei, Chu & Löschel, Andreas & Liu, Bing, 2013. "An empirical analysis of the CO2 shadow price in Chinese thermal power enterprises," Energy Economics, Elsevier, vol. 40(C), pages 22-31.
    10. Christopher O’Donnell & D. Rao & George Battese, 2008. "Metafrontier frameworks for the study of firm-level efficiencies and technology ratios," Empirical Economics, Springer, vol. 34(2), pages 231-255, March.
    11. Yang, Hongliang & Pollitt, Michael, 2010. "The necessity of distinguishing weak and strong disposability among undesirable outputs in DEA: Environmental performance of Chinese coal-fired power plants," Energy Policy, Elsevier, vol. 38(8), pages 4440-4444, August.
    12. Qiang Zhang & Xujia Jiang & Dan Tong & Steven J. Davis & Hongyan Zhao & Guannan Geng & Tong Feng & Bo Zheng & Zifeng Lu & David G. Streets & Ruijing Ni & Michael Brauer & Aaron van Donkelaar & Randall, 2017. "Transboundary health impacts of transported global air pollution and international trade," Nature, Nature, vol. 543(7647), pages 705-709, March.
    13. William Cooper & Kyung Park & Jesus Pastor, 1999. "RAM: A Range Adjusted Measure of Inefficiency for Use with Additive Models, and Relations to Other Models and Measures in DEA," Journal of Productivity Analysis, Springer, vol. 11(1), pages 5-42, February.
    14. Wei, Xiao & Zhang, Ning, 2020. "The shadow prices of CO2 and SO2 for Chinese Coal-fired Power Plants: A partial frontier approach," Energy Economics, Elsevier, vol. 85(C).
    15. Charnes, A. & Cooper, W. W. & Golany, B. & Seiford, L. & Stutz, J., 1985. "Foundations of data envelopment analysis for Pareto-Koopmans efficient empirical production functions," Journal of Econometrics, Elsevier, vol. 30(1-2), pages 91-107.
    16. Wang, Chunhua & Cao, Xiaoyong & Mao, Jie & Qin, Ping, 2019. "The changes in coal intensity of electricity generation in Chinese coal-fired power plants," Energy Economics, Elsevier, vol. 80(C), pages 491-501.
    17. Eguchi, Shogo & Takayabu, Hirotaka & Lin, Chen, 2021. "Sources of inefficient power generation by coal-fired thermal power plants in China: A metafrontier DEA decomposition approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 138(C).
    18. Song, Malin & An, Qingxian & Zhang, Wei & Wang, Zeya & Wu, Jie, 2012. "Environmental efficiency evaluation based on data envelopment analysis: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 16(7), pages 4465-4469.
    19. Long, Xingle & Sun, Mei & Cheng, Faxin & Zhang, Jijian, 2017. "Convergence analysis of eco-efficiency of China’s cement manufacturers through unit root test of panel data," Energy, Elsevier, vol. 134(C), pages 709-717.
    20. Long, Xingle & Zhao, Xicang & Cheng, Faxin, 2015. "The comparison analysis of total factor productivity and eco-efficiency in China's cement manufactures," Energy Policy, Elsevier, vol. 81(C), pages 61-66.
    21. Zhang, Ning & Choi, Yongrok, 2013. "A comparative study of dynamic changes in CO2 emission performance of fossil fuel power plants in China and Korea," Energy Policy, Elsevier, vol. 62(C), pages 324-332.
    22. Zhang, Ning & Kong, Fanbin & Choi, Yongrok & Zhou, P., 2014. "The effect of size-control policy on unified energy and carbon efficiency for Chinese fossil fuel power plants," Energy Policy, Elsevier, vol. 70(C), pages 193-200.
    23. Wang, Qunwei & Zhao, Zengyao & Zhou, Peng & Zhou, Dequn, 2013. "Energy efficiency and production technology heterogeneity in China: A meta-frontier DEA approach," Economic Modelling, Elsevier, vol. 35(C), pages 283-289.
    24. Fare, Rolf & Knox Lovell, C. A., 1978. "Measuring the technical efficiency of production," Journal of Economic Theory, Elsevier, vol. 19(1), pages 150-162, October.
    25. K.R. Shanmugam & Praveen Kulshreshtha, 2005. "Efficiency analysis of coal-based thermal power generation in India during post-reform era," International Journal of Global Energy Issues, Inderscience Enterprises Ltd, vol. 23(1), pages 15-28.
    26. Necmi Avkiran & Kaoru Tone & Miki Tsutsui, 2008. "Bridging radial and non-radial measures of efficiency in DEA," Annals of Operations Research, Springer, vol. 164(1), pages 127-138, November.
    27. Du, Limin & Hanley, Aoife & Zhang, Ning, 2016. "Environmental technical efficiency, technology gap and shadow price of coal-fuelled power plants in China: A parametric meta-frontier analysis," Resource and Energy Economics, Elsevier, vol. 43(C), pages 14-32.
    28. Zhang, Ning & Choi, Yongrok, 2013. "Total-factor carbon emission performance of fossil fuel power plants in China: A metafrontier non-radial Malmquist index analysis," Energy Economics, Elsevier, vol. 40(C), pages 549-559.
    29. Chambers, Robert G. & Fare, Rolf & Grosskopf, Shawna, 1996. "Productivity Growth in APEC Countries," Working Papers 197843, University of Maryland, Department of Agricultural and Resource Economics.
    30. Du, Limin & Mao, Jie, 2015. "Estimating the environmental efficiency and marginal CO2 abatement cost of coal-fired power plants in China," Energy Policy, Elsevier, vol. 85(C), pages 347-356.
    31. Fare, Rolf & Grosskopf, Shawna & Noh, Dong-Woon & Weber, William, 2005. "Characteristics of a polluting technology: theory and practice," Journal of Econometrics, Elsevier, vol. 126(2), pages 469-492, June.
    32. Mou, Dunguo, 2014. "Understanding China’s electricity market reform from the perspective of the coal-fired power disparity," Energy Policy, Elsevier, vol. 74(C), pages 224-234.
    33. A. Charnes & W. W. Cooper, 1962. "Programming with linear fractional functionals," Naval Research Logistics Quarterly, John Wiley & Sons, vol. 9(3‐4), pages 181-186, September.
    34. Xingle Long & Sangwook Kim & Yunhai Dai, 2021. "Fdi And Convergence Analysis Of Productivity Across Chinese Prefecture-Level Cities Through Bootstrap Truncation Regression," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 66(03), pages 837-853, June.
    35. Feng, Chao & Zhang, Hua & Huang, Jian-Bai, 2017. "The approach to realizing the potential of emissions reduction in China: An implication from data envelopment analysis," Renewable and Sustainable Energy Reviews, Elsevier, vol. 71(C), pages 859-872.
    36. Fan, Jing-Li & Zhang, Hao & Zhang, Xian, 2020. "Unified efficiency measurement of coal-fired power plants in China considering group heterogeneity and technological gaps," Energy Economics, Elsevier, vol. 88(C).
    37. Fumiya Nagashima & Shigemi Kagawa & Sangwon Suh & Keisuke Nansai & Daniel Moran, 2017. "Identifying critical supply chain paths and key sectors for mitigating primary carbonaceous PM mortality in Asia," Economic Systems Research, Taylor & Francis Journals, vol. 29(1), pages 105-123, January.
    38. Nakaishi, Tomoaki, 2021. "Developing effective CO2 and SO2 mitigation strategy based on marginal abatement costs of coal-fired power plants in China," Applied Energy, Elsevier, vol. 294(C).
    39. Tone, Kaoru, 2001. "A slacks-based measure of efficiency in data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 130(3), pages 498-509, May.
    40. William W. Cooper & Lawrence M. Seiford & Kaoru Tone, 2007. "Data Envelopment Analysis," Springer Books, Springer, edition 0, number 978-0-387-45283-8, November.
    41. Yu, Yanni & Qian, Tao & Du, Limin, 2017. "Carbon productivity growth, technological innovation, and technology gap change of coal-fired power plants in China," Energy Policy, Elsevier, vol. 109(C), pages 479-487.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Nakaishi, Tomoaki & Nagashima, Fumiya & Kagawa, Shigemi & Nansai, Keisuke & Chatani, Satoru, 2023. "Quantifying the health benefits of improving environmental efficiency: A case study from coal power plants in China," Energy Economics, Elsevier, vol. 121(C).
    2. Nakaishi, Tomoaki & Chapman, Andrew & Kagawa, Shigemi, 2022. "Shedding Light on the energy-related social equity of nations toward a just transition," Socio-Economic Planning Sciences, Elsevier, vol. 83(C).
    3. Salman, Muhammad & Long, Xingle & Wang, Guimei & Zha, Donglan, 2022. "Paris climate agreement and global environmental efficiency: New evidence from fuzzy regression discontinuity design," Energy Policy, Elsevier, vol. 168(C).
    4. Lin, Boqiang & Xie, Yongjing, 2022. "Analysis on operational efficiency and its influencing factors of China’s nuclear power plants," Energy, Elsevier, vol. 261(PA).
    5. Du, Limin & Lu, Yunguo & Ma, Chunbo, 2022. "Carbon efficiency and abatement cost of China's coal-fired power plants," Technological Forecasting and Social Change, Elsevier, vol. 175(C).
    6. Shogo Eguchi, 2022. "CO 2 Reduction Potential from Efficiency Improvements in China’s Coal-Fired Thermal Power Generation: A Combined Approach of Metafrontier DEA and LMDI," Energies, MDPI, vol. 15(7), pages 1-19, March.
    7. Tao Li & Yunfen Guo & Liqi Yi & Tian Gao, 2022. "Environmental Performance Evaluation of New Type Thermal Power Enterprises Considering Carbon Peak and Neutrality," Sustainability, MDPI, vol. 14(7), pages 1-18, March.
    8. Ioannis E. Tsolas, 2023. "Efficiency Measurement of Lignite-Fired Power Plants in Greece Using a DEA-Bootstrap Approach," Sustainability, MDPI, vol. 15(4), pages 1-10, February.
    9. Li, Yanbin & Zhao, Ke & Zhang, Feng, 2023. "Identification of key influencing factors to Chinese coal power enterprises transition in the context of carbon neutrality: A modified fuzzy DEMATEL approach," Energy, Elsevier, vol. 263(PA).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Eguchi, Shogo & Takayabu, Hirotaka & Lin, Chen, 2021. "Sources of inefficient power generation by coal-fired thermal power plants in China: A metafrontier DEA decomposition approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 138(C).
    2. Zhang, Ning & Zhao, Yu & Wang, Na, 2022. "Is China's energy policy effective for power plants? Evidence from the 12th Five-Year Plan energy saving targets," Energy Economics, Elsevier, vol. 112(C).
    3. Shogo Eguchi, 2022. "CO 2 Reduction Potential from Efficiency Improvements in China’s Coal-Fired Thermal Power Generation: A Combined Approach of Metafrontier DEA and LMDI," Energies, MDPI, vol. 15(7), pages 1-19, March.
    4. Du, Limin & Lu, Yunguo & Ma, Chunbo, 2022. "Carbon efficiency and abatement cost of China's coal-fired power plants," Technological Forecasting and Social Change, Elsevier, vol. 175(C).
    5. Li, Gao & Ruonan, Li & Yingdan, Mei & Xiaoli, Zhao, 2022. "Improve technical efficiency of China's coal-fired power enterprises: Taking a coal-fired-withdrawl context," Energy, Elsevier, vol. 252(C).
    6. Nakaishi, Tomoaki, 2021. "Developing effective CO2 and SO2 mitigation strategy based on marginal abatement costs of coal-fired power plants in China," Applied Energy, Elsevier, vol. 294(C).
    7. Yongrok Choi & Yunning Ma & Yu Zhao & Hyoungsuk Lee, 2023. "Inequality in Fossil Fuel Power Plants in China: A Perspective of Efficiency and Abatement Cost," Sustainability, MDPI, vol. 15(5), pages 1-15, March.
    8. Long, Xingle & Wu, Chao & Zhang, Jijian & Zhang, Jing, 2018. "Environmental efficiency for 192 thermal power plants in the Yangtze River Delta considering heterogeneity: A metafrontier directional slacks-based measure approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 82(P3), pages 3962-3971.
    9. Nakaishi, Tomoaki & Nagashima, Fumiya & Kagawa, Shigemi & Nansai, Keisuke & Chatani, Satoru, 2023. "Quantifying the health benefits of improving environmental efficiency: A case study from coal power plants in China," Energy Economics, Elsevier, vol. 121(C).
    10. Sueyoshi, Toshiyuki & Yuan, Yan & Goto, Mika, 2017. "A literature study for DEA applied to energy and environment," Energy Economics, Elsevier, vol. 62(C), pages 104-124.
    11. Yu, Yanni & Qian, Tao & Du, Limin, 2017. "Carbon productivity growth, technological innovation, and technology gap change of coal-fired power plants in China," Energy Policy, Elsevier, vol. 109(C), pages 479-487.
    12. Arabi, Behrouz & Munisamy, Susila & Emrouznejad, Ali & Shadman, Foroogh, 2014. "Power industry restructuring and eco-efficiency changes: A new slacks-based model in Malmquist–Luenberger Index measurement," Energy Policy, Elsevier, vol. 68(C), pages 132-145.
    13. Wei, Chu & Löschel, Andreas & Liu, Bing, 2015. "Energy-saving and emission-abatement potential of Chinese coal-fired power enterprise: A non-parametric analysis," Energy Economics, Elsevier, vol. 49(C), pages 33-43.
    14. Gerami, Javad & Mozaffari, Mohammad Reza & Wanke, Peter F. & Correa, Henrique L., 2022. "Improving information reliability of non-radial value efficiency analysis: An additive slacks based measure approach," European Journal of Operational Research, Elsevier, vol. 298(3), pages 967-978.
    15. Zhang, Ning & Jiang, Xue-Feng, 2019. "The effect of environmental policy on Chinese firm's green productivity and shadow price: A metafrontier input distance function approach," Technological Forecasting and Social Change, Elsevier, vol. 144(C), pages 129-136.
    16. Du, Limin & Hanley, Aoife & Zhang, Ning, 2016. "Environmental technical efficiency, technology gap and shadow price of coal-fuelled power plants in China: A parametric meta-frontier analysis," Resource and Energy Economics, Elsevier, vol. 43(C), pages 14-32.
    17. Wei, Xiao & Zhang, Ning, 2020. "The shadow prices of CO2 and SO2 for Chinese Coal-fired Power Plants: A partial frontier approach," Energy Economics, Elsevier, vol. 85(C).
    18. Chen, Bin & Jin, Yingmei, 2020. "Adjusting productivity measures for CO2 emissions control: Evidence from the provincial thermal power sector in China," Energy Economics, Elsevier, vol. 87(C).
    19. Xingle Long & Yusen Luo & Huaping Sun & Gang Tian, 2018. "Fertilizer using intensity and environmental efficiency for China’s agriculture sector from 1997 to 2014," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 92(3), pages 1573-1591, July.
    20. Gómez-Calvet, Roberto & Conesa, David & Gómez-Calvet, Ana Rosa & Tortosa-Ausina, Emili, 2014. "Energy efficiency in the European Union: What can be learned from the joint application of directional distance functions and slacks-based measures?," Applied Energy, Elsevier, vol. 132(C), pages 137-154.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:eneeco:v:102:y:2021:i:c:s0140988321003935. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eneco .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.