Efficiency in Angolan thermal power plants: Evidence from cost structure and pollutant emissions

This research focuses on the efficiency assessment of Angolan thermal power plants using a Slacks Based Model with undesirable (bad) outputs (SBM-Undesirable). In this research, SBM-Undesirable is used first in a two-stage approach to assess the relative efficiency for these power plants. The most frequent cost structure variables adopted by literature to characterize a productive technology are used. In the second stage, Beta Regression models are combined with SBM-Undesirable efficiency scores to produce a model for predicting energy production performance. Results indicate that thermal power plants in Angola that are intensive in capital-to the detriment of labor-and that present lower unit capacity costs are more efficient and less polluting. Results also indicate the absence of a learning curve for increasing efficiency in energy generation. Policy implications are derived.