Environmental Assessment on Energy and Sustainability by Data Envelopment Analysis

18SCALE EFFICIENCY

18.1 INTRODUCTION

This chapter¹ describes how to measure the degree of scale efficiency under natural or managerial disposability. Scale efficiency indicates a managerial level regarding how each DMU can control its operational size in such a manner that it can enhance the level of unified efficiency.

To document the practicality of the proposed scale efficiency measurement, this chapter applies it to examine the performance of coal‐fired power plants in the north‐east region of the United States. This chapter is also interested in examining whether there is a significant difference between the two types (BIT: bituminous coal and SUB: subbituminous coal) of coal‐fired power plants in their unified efficiency measures, including their scale efficiency measures, under natural and managerial disposability concepts, respectively. Chapter 17 has discussed the coal‐fired power plants in ISO and RTO. Meanwhile, this chapter is not interested in such regional differences in power plant control, rather being concerned with the type of coal combustion in the power plants. As discussed in Chapter 14, the north‐east region (e.g., West Virginia) is controlled by PJM. The PJM, as the most well‐known Regional Transmission Organization (RTO) in the United States, covers areas near the Appalachian Mountains which produce a large amount of SUB. The operation of PJM mainly uses SUB combustion in its coal‐fired power plants. Consequently, the research concern of this chapter is whether ...