A regulatory robust conditional approach to measuring the efficiency of wholesale water supply and wastewater treatment services

Abstract

A benchmarking evaluation instrument was designed with a European Union country regulatory authority for water supply and wastewater treatment services to determine the efficient operating cost of its service providers that operated in the wholesale market segment in the 2017–2021 period. To this end, the non-parametric Data Envelopment Analysis technique was adapted to a robust and conditional approach. The results point to similar mean efficiency scores between water supply and wastewater services in the five-year period, despite the greater heterogeneity in the latter. Furthermore, the estimated potential cost savings for both services ranged from about 2% to 3%.