Abstract
There is growing the consensus that regional regulatory agencies provide regional club goods, however; there is little evidence of the impact of the collaborations of the utility providers themselves in the literature. Our study analyzes whether regional networks such as the Caribbean Electric Utility corporation contribute to solving energy issues in Latin America and the Caribbean. Networks of operators provide cross -border services, and operating as a single entity improves the lobbying opportunities of operators to influence policy. Results suggest that utilities that formed linkages or cooperation regionally are likely to benefit from such collaborations, but a comprehensive approach to capacity building and reform is needed to address the regions energy issues.
Highlights
Latin America and the Caribbean (LAC) have been finding new and unique ways to improve their access to resources and to improve infrastructure within individual nations
The challenge for a comprehensive policy is that Caribbean islands are relatively small in size and population, and have limited ability to benefit from economies of scale in administration, technical support and production
With the exception of Trinidad and Tobago, Caribbean countries are not major producers and exporters of energy (Yépez-García and Dana, 2012), there is a need for the region to formulate and enact policies that will address the long-term requirements of the region
Summary
Latin America and the Caribbean (LAC) have been finding new and unique ways to improve their access to resources and to improve infrastructure within individual nations. A number of specialists will exist in the region among the different utilities, and it will be cost efficient and even natural for them to form independent groups that can offer mutually benefiting services Such collaborations can generate positive externalities and economies of scale with the potential for spillovers of innovation and know-how among firms that engage in joint development efforts and through the exchange of capacity (Girvan, 2007). The combination of the non-rival and exclusionary properties of club goods means that the goods and services that are provided by regional utility collaborations can be considered as club goods that generate benefits that are private in nature This is because non-members who do not contribute to the goods production are excluded from its consumption. The association’s contributions while important may be too small to reflect on electric usage in the Caribbean
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