Data envelopment scenario analysis for setting targets to electricity generating plants

The development of viable and challenging performance measurement systems in multi-unit organisations receives increased attention in recent years. Performance is no longer viewed as a static phenomenon that reflects the past history of operating systems. There is increasing appreciation for the value of performance scenarios which can be used to guide management for the expected performance consequences of alternative policies. In this paper we demonstrate how data envelopment analysis can be used to develop policy making scenarios that would enable managers to identify the response of productive units such as power plants to different priorities regarding demand of services, costs and pollution emissions.