Optimizing Greenhouse Gas Emissions: A Productivity-Efficiency Analysis of Indonesian Coal-Fired Power Plants

Indonesia as one of the most populated countries still relies on Coal-fired Power Plants (PLTU, in Indonesian) for meeting its electricity demands. However, the electricity generation is associated with greenhouse gas (GHG) emissions generation that cannot be overlooked, as the substantial release of carbon gases into the atmosphere exacerbates pollution, leading to global warming and destructive climate shifts. The environmental repercussions of coal-fired power plants underscore the necessity to optimize their efficiency and productivity, all while addressing greenhouse gas emissions. This article uses Data Envelopment Analysis (DEA) for efficiency assessment and Malmquist Productivity Index (MPI) for assessing changes in productivity. The DEA-MPI model incorporates two input variables (coal consumption and installed capacity), single desirable outputs (generated electricity), and four undesirable outputs, specifically GHG emissions (CO₂, Nox, SO2, particles). The DEA-MPI efficiency and productivity analysis shows that 30% of PLTUs function optimally, 14% exhibit inefficiencies in resource utilization, 12% experience diminishing performance, 35% demand prioritized improvement efforts, and 9% remain stagnant. Notably, the majority fall within the 'priority for enhancement' category, emphasizing the need for substantial improvements across Indonesia's PLTU landscape.