Techno-economical efficiency and productivity change of wastewater treatment plants: the role of internal and external factors.

Efficiency and productivity are important measures for identifying best practice in businesses and optimising resource-use. This study analyses how these two measures change across the period 2003-2008 for 196 wastewater treatment plants (WWTPs) in Spain, by using the benchmarking methods of Data Envelopment Analysis and the Malmquist Productivity Index. To identify which variables contribute to the sustainability of the WWTPs, differences in efficiency scores and productivity indices for external factors are also investigated. Our results indicate that both efficiency and productivity decreased over the five years. We verify that the productivity drop is primarily explained by technical change. Furthermore, certain external variables affected WWTP efficiency, including plant size, treatment technology and energy consumption. However, plants with low energy consumption are the only ones which improve their productivity. Finally, the benchmarking analyses proved to be useful as management tools in the wastewater sector, by providing vital information for improving the sustainability of plants.

[1]  John Fenwick,et al.  The New Political Management in Local Government: Public Engagement or Public Indifference? , 2004 .

[2]  William W. Cooper,et al.  Using Malmquist Indexes to measure changes in the productivity and efficiency of US accounting firms before and after the Sarbanes–Oxley Act , 2009 .

[3]  A. Schaefer.  Contrasting Institutional and Performance Accounts of Environmental Management Systems: Three Case Studies in the UK Water & Sewerage Industry , 2007 .

[4]  R. Färe,et al.  Productivity Developments in Swedish Hospitals: A Malmquist Output Index Approach , 1994 .

[5]  C. Hsiao,et al.  Performance measurement in wastewater control - pig farms in Taiwan. , 2007 .

[6]  María Molinos-Senante,et al.  Economic feasibility study for wastewater treatment: a cost-benefit analysis. , 2010, The Science of the total environment.

[7]  Les Tien-Shang Lee,et al.  On efficiency of integrative strategies among companies in US high-tech industry , 2010 .

[8]  A. U.S.,et al.  Measuring the efficiency of decision making units , 2003 .

[9]  Fei Yang,et al.  Data envelopment analysis for assessing optimal operation of an immersed membrane bioreactor equipped with a draft tube for domestic wastewater reclamation , 2007 .

[10]  Teofilo Ozuna,et al.  Can public sector reforms improve the efficiency of public water utilities? , 2002, Environment and Development Economics.

[11]  P. Binning,et al.  Increasing urban water self-sufficiency: new era, new challenges. , 2011, Journal of environmental management.

[12]  Brian Dollery,et al.  The relative economic efficiency of urban water utilities in regional New South Wales and Victoria , 2010 .

[13]  Giovanni Fraquelli,et al.  Scope and scale economies in multi-utilities: evidence from gas, water and electricity combinations , 2004 .

[14]  Rui Cunha Marques,et al.  Measuring the total factor productivity of the portuguese water and sewerage services , 2008 .

[15]  C. Lovell,et al.  A note on the Malmquist productivity index , 1995 .

[16]  Francesc Hernández-Sancho,et al.  Technical efficiency and cost analysis in wastewater treatment processes: A DEA approach , 2009 .

[17]  P. W. Wilson,et al.  Estimation and inference in two-stage, semi-parametric models of production processes , 2007 .

[18]  James Odeck,et al.  Identifying traffic safety best practice: an application of DEA and Malmquist indices , 2006 .

[19]  Amos Bick,et al.  Immersed Membrane BioReactor (IMBR) for treatment of combined domestic and dairy wastewater in an isolated farm , 2005 .

[20]  María Molinos-Senante,et al.  Comparing the efficiency of wastewater treatment technologies through a DEA metafrontier model , 2011 .

[21]  David Parker,et al.  The impact of privatization and regulation on the water and sewerage industry in England and Wales: a translog cost function model , 2000 .

[22]  J. M. Pastor,et al.  An Efficiency Comparison of European Banking Systems Operating under Different Environmental Conditions , 2002 .

[23]  Mette Asmild,et al.  The biennial Malmquist productivity change index , 2011 .

[24]  Andrés J. Picazo-Tadeo,et al.  The role of environmental factors in water utilities’ technical efficiency. Empirical evidence from Spanish companies , 2009 .

[25]  Chih-Hai Yang,et al.  Are small firms less efficient? , 2009 .

[26]  Lester C. Hunt,et al.  Privatisation and Efficiency in the UK Water Industry: An Empirical Analysis , 2009 .

[27]  Graeme D. Ruxton,et al.  Some suggestions about appropriate use of the Kruskal–Wallis test , 2008, Animal Behaviour.

[28]  Andrew C. Worthington,et al.  Diversity in Australian Local Government: The Case against the Imposition of Uniform National Standards , 2001 .

[29]  Emmanuel Thanassoulis,et al.  DEA and its use in the regulation of water companies , 2000, Eur. J. Oper. Res..

[30]  G. Battese,et al.  A Metafrontier Production Function for Estimation of Technical Efficiencies and Technology Gaps for Firms Operating Under Different Technologies , 2004 .

[31]  Antonio Estache,et al.  Efficiency Effects of 'Privatization' in Argentina's Water and Sanitation Services , 2003 .

[32]  Hsihui Chang,et al.  Taiwan quality indicator project and hospital productivity growth , 2010, Omega.

[33]  Bernardino Benito,et al.  Explaining differences in efficiency: an application to Spanish municipalities , 2010 .

[34]  R. Färe,et al.  The measurement of efficiency of production , 1985 .

[35]  Ming-Miin Yu,et al.  Total factor productivity growth in China's agricultural sector , 2008 .

[36]  Chia-Chi Sun,et al.  Evaluating and benchmarking productive performances of six industries in Taiwan Hsin Chu Industrial Science Park , 2011, Expert Syst. Appl..

[37]  Valentin Zelenyuk,et al.  Aggregation of Malmquist productivity indexes , 2006, Eur. J. Oper. Res..

[38]  Carlos Pestana Barros,et al.  Efficiency determinants in retail stores: a Bayesian framework , 2011 .

[39]  Theodor J. Stewart,et al.  Goal directed benchmarking for organizational efficiency , 2010 .

[40]  Abraham Charnes,et al.  Measuring the efficiency of decision making units , 1978 .

[41]  Emmanuel Thanassoulis,et al.  The use of data envelopment analysis in the regulation of UK water utilities: Water distribution , 2000, Eur. J. Oper. Res..

[42]  S. Malmquist.  Index numbers and indifference surfaces , 1953 .

[43]  Mithat Zeydan,et al.  A combined methodology for supplier selection and performance evaluation , 2011, Expert Syst. Appl..

[44]  David S. Saal,et al.  Productivity and Price Performance in the Privatized Water and Sewerage Companies of England and Wales , 2001 .

[45]  Suthathip Yaisawarng,et al.  The Effects of Sulfur Dioxide Controls on Productivity Change in the U.S. Electric Power Industry , 1994 .

[46]  Rui Cunha Marques,et al.  A yardstick competition model for Portuguese water and sewerage services regulation , 2006 .

[47]  Marcelo Resende,et al.  Efficiency and regulatory issues in the Brazilian water and sewage sector: an empirical study , 2004 .

[48]  J. Odeck.  Statistical precision of DEA and Malmquist indices: A bootstrap application to Norwegian grain producers , 2009 .

[49]  Yuan-Duen Lee,et al.  Applying integrated DEA/AHP to evaluate the economic performance of local governments in China , 2011, Eur. J. Oper. Res..

[50]  Ana S. Camanho,et al.  Evaluation of performance of European cities with the aim to promote quality of life improvements , 2011 .

[51]  María Molinos-Senante,et al.  Cost modelling for wastewater treatment processes , 2011 .

[52]  Chin-Wei Huang,et al.  Assessment of China transit and economic efficiencies in a modified value-chains DEA model , 2011, Eur. J. Oper. Res..

[53]  W. Kruskal,et al.  Use of Ranks in One-Criterion Variance Analysis , 1952 .

[54]  Gideon Oron,et al.  Data envelopment analysis for assessing optimal operation of ultra-filtration systems for effluent polishing , 2003 .

[55]  I. García‐Sánchez,et al.  Efficiency Measurement in Spanish Local Government: The Case of Municipal Water Services , 2006 .

[56]  L. R. Christensen,et al.  MULTILATERAL COMPARISONS OF OUTPUT, INPUT, AND PRODUCTIVITY USING SUPERLATIVE INDEX NUMBERS* , 1982 .