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Assessing the efficiency dynamics of post reforms electric distribution utilities in Pakistan

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  • Mirza, Faisal Mehmood
  • Mushtaq, Iqra
  • Ullah, Kafait

Abstract

The power sector of Pakistan has undergone major reforms since 1994 with the objectives of increasing technical and financial performance of the sector. This study estimates and analyzes post reforms efficiency dynamics of electric distribution utilities from 2006 to 2013. Fixed effects stochastic frontier analysis results indicate that technical efficiency of utilities increased by 4.8 percent. However, total factor productivity experienced a negative growth of 11 percent as all components of index remained negative except for efficiency change. Productivity of electric distribution utilities can be enhanced by adjusting their scales of operation and reducing their size through further horizontal separation.

Suggested Citation

  • Mirza, Faisal Mehmood & Mushtaq, Iqra & Ullah, Kafait, 2017. "Assessing the efficiency dynamics of post reforms electric distribution utilities in Pakistan," Utilities Policy, Elsevier, vol. 47(C), pages 18-28.
    • Handle: RePEc:eee:juipol:v:47:y:2017:i:c:p:18-28
    DOI: 10.1016/j.jup.2017.06.003
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    Cited by:

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    4. Xie, Bai-Chen & Ni, Kang-Kang & O'Neill, Eoghan & Li, Hong-Zhou, 2021. "The scale effect in China's power grid sector from the perspective of malmquist total factor productivity analysis," Utilities Policy, Elsevier, vol. 69(C).
    5. Patyal, Vishal Singh & Kumar, Ravi & Lamba, Kuldeep & Maheshwari, Sunil, 2023. "Performance evaluation of Indian electricity distribution companies: An integrated DEA-IRP-TOPSIS approach," Energy Economics, Elsevier, vol. 124(C).
    6. Fahad Bin Abdullah & Rizwan Iqbal & Falak Shad Memon & Sadique Ahmad & Mohammed A. El-Affendi, 2023. "Advancing Sustainability in the Power Distribution Industry: An Integrated Framework Analysis," Sustainability, MDPI, vol. 15(10), pages 1-28, May.
    7. Mirza, Faisal Mehmood & Rizvi, Syed Badar-Ul-Husnain & Bergland, Olvar, 2021. "Service quality, technical efficiency and total factor productivity growth in Pakistan's post-reform electricity distribution companies," Utilities Policy, Elsevier, vol. 68(C).
    8. Mirza, Faisal Mehmood & Mushtaq, Iqra, 2022. "Estimating the marginal cost of improving services quality in electricity distribution utilities of Pakistan," Energy Policy, Elsevier, vol. 167(C).
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    More about this item

    Keywords

    Market reforms; Efficiency dynamics; Stochastic frontier analysis; Distribution utilities; Panel data; Pakistan;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L95 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Gas Utilities; Pipelines; Water Utilities
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities

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