A panel data analysis on the costs of Turkish electricity distribution companies

Abstract

Turkey initiated electricity market reforms in 2001, and privatization of distribution companies was one of the main pillars of the electricity market reform. However, many problems have been encountered during the reform process, and both the regulator and the regulated parties are still struggling with major issues such as high loss ratio, financial soundness of the companies, and service quality problems. Moreover, there are concerns about the financial sustainability of these companies due to the recent depreciation of the Turkish Lira. In this respect, this article aims to contribute to the discussions by using panel data analysis to understand the factors affecting the costs of the distribution companies between 2011 and 2014.