Energy Efficiency in India’s Iron and Steel Industry: A Firm-level Data Envelopment Analysis
India’s national mission to improve energy efficiency focuses on enhancing the efficiency in its most energy-intensive industries. Motivated by this mission, we measure and analyze energy efficiency in the country’s iron and steel industries applying data envelopment analysis using firm-level panel data over the period 2004-2012. The results show that the energy efficiency of India’s iron and steel industries has improved and energy intensity has declined during the study period. However, there is a large potential for these industries to further reduce energy use. The results of the regression analysis obtained using panel data indicate that larger firms tend to have higher energy efficiency. In addition, labor productivity improves energy use efficiency. Improvements in energy efficiency, particularly in small and medium firms should be encouraged.
International Energy Agency (2016). Energy efficiency market report 2016. World Energy
Outlook Special Report. Paris: IEA.
Martinez, C. (2015). Estimating and analyzing energy efficiency in German and
Colombian manufacturing industries using DEA and data panel analysis. Part I:
Energy-intensive Sectors. Energy Sources, Part B: Economics, Planning and Policy,
(3), pages 322–331.
International Energy Agency (2015). India energy outlook. World Energy Outlook
Special Report. Paris: IEA.
Morrow III, W., Hasanbeigi, A., Sathaye, J. and Xu, T. (2014). Assessment of energy
efficiency improvement and CO2 emission reduction potentials in India’s cement
and iron and steel industries. Journal of Cleaner Production, 65, pages 131–141.
Debnath, R. and Sebastian, V. (2014). Efficiency in the Indian iron and steel industry—
an application of data envelopment analysis. Journal of Advances in Management
Research, 11(1), pages 4–19.
Dwivedi, A., Ghosh, P. and Dangayach, G. (2013). Efficiency measurement of Indian
steel industry using data envelopment analysis. International Journal of Operational
Research, 18(4), pages 386–400.
Mukherjee, K. (2008). Energy use efficiency in the Indian manufacturing sector: an
interstate analysis. Energy Policy, 36, pages 662–672.
Government of India (2017). National steel policy. http://steel.gov.in/PDF/
DRAFT%20NATIONAL%20STEEL%20POLICY%202017.pdf, accessed 14 April