Stepwise efficiency assessment in a competitive scenario using DEA for ratios: service level benchmark

Abstract

Abstract Urban water utility (UWU) regulation has been a potential practice in the water industry for years. This is because UWUs operate in an environment without competitors, and regulating them in a competitive scenario under sunshine regulation helps UWUs simulate the best management strategies. During efficiency assessment, the selection of the best, intermediate and least performing UWUs involves averaging scores of many efficiency assessment criteria analysed separately. This study expands a UWU efficiency assessment based on attaining service-level-benchmark and agreed target-level criteria using network data envelopment analysis (NDEA) for ratios. The assessment shows that the average of efficiencies of the two criteria identify a UWU with the best and worst performance in selected key indicators.