Research On The Technical Efficiency Of Thermal Power Industry

Since2002, China’s electricity industry has carried out a market-oriented reform. After that,the power industry has undergone a great development. In2013, the installed capacity of China’s power ranked the first place around the world. However, some scholars believe that the efficiency of thermal power industry still operates less efficiently The main subject of the paper is at what level is technical efficiency of thermal power industry nowadays and what affects that after the reform of power industry ten years ago in2002.The paper starts with a literature review about the power industry’s efficiency research.Then summarizes the concept of the technical efficiency and related research methods and raises the methodology of the paper. In Chapter IV, the paper analyzes the exogenous factors affecting the technical efficiency of the thermal power industry. The last section is the paper’s main part:empirical study and policy suggestion.The paper has measured the technology efficiency and its changing trend of thermal power industry in the late period of the market-oriented reform in power industry based on the triple element production function model of capital-labor-energy and the SFA model by inputting the panel data of the thermal power industries from30provinces. Intensive attention has been paid on the impact of five factors on the technical efficiency of the thermal power industry which is coal and electricity price, ownership structure, enterprise scale and environmental regulationThe empirical study has found that:Firstly, in terms of the technical efficiency,the mean value of technical efficiency in thermal power industry is0.81, displaying a upward trend overall from2004to2011. Secondly, in terms of influence factors of technical inefficiency, both grid price and coal price has shown a significantly negative relationship with the technical inefficiency. Thirdly, the ratio of state-owned property in power industry has shown a significantly positive relation with the technical inefficiency, indicating that the more the ratio, the high the inefficiency level. Fourthly, enterprise scale has displayed a significantly negative relationship with the technical inefficiency, indicating that to increase the enterprise scale will facilitate the technical efficiency. Fifthly, environmental regulation has displayed a significantly positive relationship with the technical inefficiency, indicating that to tighten the environmental regulation will make a contribution to the technical efficiency. Finally, policy advice is put forward by summarizing the above-mentioned conclusions.