Evaluating Performance of Electricity Distribution Centers and Improving Relative Operational Efficiencies through Reorganization: A Case of Nepal

This paper analyzes the performance of the electricity distribution system in Nepal. Weight restriction data envelopment analysis (DEA) technique has been used to quantify the relative operational efficiencies of the distribution centers (DCs) owned by Nepal Electricity Authority (NEA). The proposed model incorporates a wide range of variables that capture the essence of electricity distribution process. Decision maker’s opinion on the relevance and relative importance of the decision variables have been incorporated judiciously in the analysis in order to identify the possible improvement strategies for the DCs. This study also investigates the possibility of reorganization of the existing DCs inside the NEA’s distribution framework on the basis of geographical convenience. Sensitivity analysis is carried out in order to check the robustness of the results and to suggest the direction for improvements. Strengths and weaknesses of individual DCs are identified based on the results of the sensitivity analysis.