Spatial autocorrelation analysis of the environmental efficiency of coal-fired power plants in China

Abstract: Although many studies have analyzed the environmental efficiency of coal-fired power plants in China with the aim of reducing CO₂ emissions, there has been much less focus on the locations of the plants and their spatial pattern. In this study, we investigate the spatial dependence of environmental efficiency for coal-fired power plants in China from 2002 to 2011. We apply an integrated framework of data envelopment analysis and spatial autocorrelation analysis. We deduce the following three main findings from our empirical analysis: (1) the overall environmental efficiency of power plants increased during the study period, and the gap between the environmental efficiency of coastal and inland areas was reduced; (2) there is a positive spatial autocorrelation among the environmental efficiency levels of coal-fired power plants in China, and this spatial agglomeration has increased annually; and (3) high-efficiency power plants are spatially clustered in coastal areas while low-efficiency power plants are clustered in inland areas. Based on these findings, we conclude that cooperation among neighboring power plant managers is crucial to achieving effective environmental efficiency improvements, and that central and local governments should facilitate knowledge and technology spillover among the power plants. Graphical abstract: [Figure not available: see fulltext.]