Measuring the Efficiency of Iranian Electricity Distribution Companies

Using Data Envelopment Analysis (DEA), this paper examines relative performance of electricity distribution companies in Iran.Technical efficiency (overall and pure) and scale efficiency are calculated for 42 Iranian electricity distribution companies in 1381. In addition, total factor productivity growth based on Malmquist Productivity Index, is calculated for the companies during 1377-1380. The results indicate that inactivity at optimum scale is the most important factor of inefficiency and labor acquirements have no effect on companies efficiency. In addition, most of companies are operating at increasing returns to scale area. Based on Malmquist Productivity Index, estimation of total factor productivity growth is negative during 1377-1380 which can be related to using old equipments in electricity distribution networks by the companies.