Environmental Efficiency Measurement Based on Cross-Efficiency DEA Models in Power Industry

Air pollution becomes more serious with the development of industry. Taking the “sustainable development” into account, more and more corporations consider environment as an important feature in their products. Because coal is the main consumption of power industry and coal combustion can produce air pollution seriously, how to measure the environmental efficiency in power industry becomes more significant. Although there are many of synthetic evaluation methods were proposed for measuring the green degree of production, such as AHP (Analytic Hierarchy Process), PCA (Principal Components Analysis), DEA (Data Envelopment Analysis) etc., the shortcomings of each method for measure green performance are appeared in practical application. A peer appraisal methodology, denoted as cross-efficiency DEA, was applied in this paper to measure the environmental efficiency of power industry in US.