**5. Conclusions**

In this research, we have carried out an evaluation of the evolution of the technical efficiency of electricity generation for 24 countries in Latin America and the Caribbean during the period 2010–2016. We used the DEA methodology, which allowed the evaluation of the relative efficiency of different production systems for different DMUs through a dynamic model of a CRS based on slacks and incorporated the assumption of weak disposability between electricity generation from fossil sources and CO2 emissions. Additionally, we tested the assumption of a CRS with the test proposed by Banker (1996) and concluded that the hypothesis of a CRS was not rejected. The proposed model allowed us to establish inefficiencies in the generation methods of 20 of the 24 countries studied.

When both efficient countries and sources of inefficiency are identified, the results found in the research provide relevant information for the 20 inefficient countries, because, through learning, they can adopt best practices in the productive process of generation, with those countries that make better use of their productive capacity as reference points.

The methodology used has some advantages and disadvantages that are worth noting. The advantages mainly correspond to three aspects: (i) the method does not require an explicit mathematical specification for the production or cost function, (ii) it can handle multiple inputs and outputs simultaneously and (iii) the source of the inefficiency can be identified, quantified and analyzed for each DMU.

Regarding the disadvantages, five aspects are particularly important: (i) the results are sensitive to the selection of inputs and outputs, (ii) as a non-parametric technique, the best specification cannot be corroborated, (iii) the number of efficient DMUs increases with the number of inputs and outputs, (iv) the measurement of efficiency is sensitive to outliers, and (v) the dynamic DEA assumes implicitly that there is no technological change over time. Regarding the first disadvantage, in this research, we did not have access to information associated with the labor used in the generation of electricity in each country, which, without a doubt, is an important productive factor of the activity. Therefore, for future studies, it would be interesting to introduce this variable, as previously incorporated in the study of Bi et al. [22].

Another important point is that this study focuses solely on the measurement of the technical efficiency of electricity generation, leaving aside the evaluation of the efficiency of allocation. Because of this, we did not consider the electricity rates in each country. The countries found in this study to be the most efficient do not have lower rates per unit of electricity than those that are less efficient (in terms of technical efficiency). Besides, the total losses of electricity in the transmission and distribution systems are not considered; therefore, the study does not include an evaluation of the efficiency of the electricity systems.

Finally, the results suggest that the most efficient countries have developed an institutional and legal context for energy efficiency, accompanied by other market incentives, as well as information mechanisms to improve energy efficiency. While less-efficient countries have developed the legal context recently or do not plan to do so yet, these types of countries should implement the strategies of Brazil or Mexico, which border these countries.

**Author Contributions:** Conceptualization, S.C. and Y.E.R.; methodology, S.C.; software, S.C.; validation, S.C. and Y.E.R.; formal analysis, S.C. and Y.E.R.; investigation, S.C. and Y.E.R.; resources, S.C. and Y.E.R.; data curation, S.C.; writing—original draft preparation, S.C., Y.E.R. and J.C.; writing—review and editing, Y.E.R. and J.C.; visualization, S.C. and Y.E.R.; supervision, Y.E.R. and J.C.; project administration, Y.E.R. All authors have read and agreed to the published version of the manuscript.

**Funding:** This research received no external funding.

**Conflicts of Interest:** The authors declare no conflict of interest.
