Using DEA to Evaluate Operation Efficiency of Top 10 Global Solar Photovoltaic Companies

Experts indicates that fossil fuel depletion may happen in the next 6 decades. People start to think of the possibilities of developing alternative energy. Among different alternative energy, solar offers the most adaptable application and converts sunlight directly into electrical energy with the highest efficiency. Lots of enterprises then start to launch resources to develop solar photovoltaic (solar PV) technique and thus create fierce competition. Therefore, the importance of operation efficiency in solar PV industry has been highlighted. In this research, we incorporate four-year' financial records of global top 10 solar PV companies and use DEA that includes technical efficiency, scale efficiency, and evaluation of returns to scale to evaluate each firm's operation efficiency. Results show that only 17.5% of the firms reaches the ideal efficiency. Marketing and management expense should be reduced most. Solar PV companies may scale it down and then invest in the vital part of solar PV industry, R&D. Most of the problems of solar PV industry could be solved with technical improvement. This paper renders a global view of operation efficiency evaluation that results from the top global solar PV companies, and thus makes the results more applicable and are worth of referring.