The efficiency of Brazilian electricity distributors during 2004 – 2009 . An application using DEA corrected by environmental and stochastic factors (original) (raw)

In this study, efficiency scores of Brazilian electricity distributors for the period 2004 2009 are estimated. With a database from the Brazilian regulator, the analysis uses a three-stage methodology by Fried et al (2002). At an initial stage DEA is applied, using electricity sales and customers as outputs and capital costs and OPEX as inputs. In a second stage, the inputs’ efficient slacks are obtained, after applying a SFA model to correct for the effects of environmental and random variables. Finally, each of the efficiency scores is adjusted by applying a common operating environment to each company. Alternative models were also specified, resulting in greater estimates of efficiency after adjusting for stochastic and environmental factors. These models do not present sharp changes over the period. This methodology overcomes limitations associated with the one employed recently by the Brazilian regulator: a DEA model adjusting for environment variables.

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