Restructuring Of Electricity Sector Research Articles

Evaluating of the Restructuring of the Jordanian Electric Company (1968-2017)

Objectives: This study aims to identify the impact of the restructuring of Jordan's electricity sector on the advantages of vertical integration of the Jordanian Electric Power Company (JEPCO) before restructuring, experimentally verifying the existence of economies of scale and economies of scale (vertical and horizontal integration), and testing the natural monopoly of JEPCO using a time series during the period (2017-1968).
 Methods: To achieve the purposes of the study, a multistage and output quadratic cost function was estimated with equations of capital price contribution and work from total costs as a system of equations using the Seemingly Unrelated Regression (SUR) equation system.
 Results: Empirical results indicated real economies of scale, a particular product's economies of scale in both household and generating energy sales and non-household. The results also indicated savings in the range and vertical and horizontal integration, that the JEPCO had lost the vertical integration benefits of the company before it stopped generating electricity, and that the company's losses due to the vertical dismantling averaged 12.98 million dinars.
 Conclusions: Based on these results, the study emphasized the need to balance the cost of separating the activities that may occur as a result of losing the advantages of vertical integration with the expected benefits of paving the way for competition in the electricity generation activity, which in turn enhances cost savings for consumers.

Straight out of Cape Cod: The origin of community choice aggregation and its spread to other states

This policy history describes how community choice aggregation was created in Massachusetts by a small group of advocates and subsequently spread across the US. Twenty-one interviews with key participants, primary materials from government and personal archives, and newspaper articles were used to attribute and corroborate these events. A new finding is that community choice aggregation was created as part of electric sector restructuring efforts in Massachusetts in 1997, but that this new policy was barely perceived by many stakeholders in the larger restructuring process, and was included by legislators in response to advocates who organized local governments through direct democracy strategies. Kingdon’s multiple streams approach provides a useful framework to understand how organizing by advocates led to successful passage of legislation in Massachusetts. The spread of community choice aggregation to other states occurred through organizing that combined advocacy with policy learning and emulation. CCA has since been adopted by more than 1800 local governments that represent more than 36 million people in six states. This article concludes by discussing the early outcomes, current status, and some prospective implications of community choice aggregation.

History of electric power sector restructuring in South Korea and Turkey

In many countries electric power sector has gone through unbundling. Separating generation, transmission, distribution and retail from the vertically integrated undertakings is a long and complicated process. Each country has its own power sector restructuring story. In this paper we present the restructuring experiences from South Korea and Turkey. Both countries present valuable lessons with some degree of successes and failures in their inspirations. The restructuring process in South Korea has been implemented and it is still going on. The process in Turkey is mostly completed with a result of a competitive generation sector, creation of a publicly owned transmission system operator (TSO) and fully private distribution system operators (DSOs).

Mitigating the risk of market power abuse in electricity sector restructuring: Evidence from Indonesia

This research considers the optimal configuration of successor generation companies in electricity market restructuring. The purpose of the study is to analyse the strategic behaviour of generating firms and optimise the electricity market structure under a generation constraint, transmission congestion, and DC load flow. The models applied here are perfect competition and Cournot competition applied to the Indonesia power system with the Residual Supply Index (RSI) as a tool for the risk of market power abuse. The key finding is that the characteristics of a power system, subject to generation and transmission constraints, strongly influence the optimal market structure.

The implications of political decisions on the economic situation in Egypt: انعكاسات القرارات السياسية على الوضع الاقتصادي في مصر

During the ten years before the revolution of January 2011, Egypt experienced political and economic conditions. During the period of its rule, the political system tried to issue political decisions that served the system of government and its control without making decisions in favor of the citizen. The economic situation became intolerable. The volume of spending on health and education has declined, unemployment has increased, and politically there has been a falsification of voter turnout and abuse of power by the security forces, In the Brotherhood, the situation was worse than that of President Hosni Mubarak. Egypt's credit rating fell to low. The decrease in the credit rating means that Egypt's ability to pay its external and internal obligations has decreased. Unemployment indicators rose to 13.5% and poverty rates in Egypt rose to 25.5% in 2013 after official indicators showed that the poverty rate in Egypt was 23.5% During 2012. The volume of inflation rose to more than 17.5%, and the value of the local currency (Egyptian pound) declined and lost more than 18%. As for the economic situation under the current regime, there has been a quantum leap in the volume of national projects, which has influenced a series of positive political decisions. These include the establishment of the new Suez Canal, low-income housing projects and electricity sector restructuring projects, which gave a huge economic boost that led to the appreciation of the Egyptian pound against other foreign currencies

Behavioral aspects of regulation: A discussion on switching and demand response in Turkish electricity market

Electricity sector has been transformed from state-owned monopolistic utilities to competitive markets with an aim to promote incentives for improving efficiency, reducing costs and increasing service quality to customers. One of the cardinal assumptions of the liberalized and competitive electricity markets is the rational actor, and decision-makers are assumed to make the best decisions that maximize their utility. However, a vast literature on behavioral economics has shown the weakness of economic theory in explaining and predicting individuals’ decision-making behavior. This issue is quite important for competition in electricity markets in which consumers’ preferences have a significant role. Despite its importance, this issue has almost been neglected in Turkey, which has taken major steps in electricity sector restructuring. Therefore, this paper aims to examine switching and demand response behavior in Turkish electricity market by using multiple correspondence and panel data analysis, and findings are discussed in light of the neoclassical and behavioral economics literature. Analyses’ results show that consumers’ switching and demand response behavior is consistent with the neoclassical literature to some extent; however, behavioral factors are also affecting consumers’ decisions. Furthermore, there are systemic problems that hinder effective functioning of the electricity market and restrict competition.

The Impact of Electricity Sector Restructuring on Coal-fired Power Plants in India

We examine whether the unbundling of generation from transmission and distribution services at state-owned power plants in India improved operating efficiency at these power plants. Between 1995 and 2009, 85 percent of coal-based generation capacity owned by state governments was unbundled from vertically integrated State Electricity Boards into state generating companies. We find that generating units in states that unbundled before the Electricity Act of 2003 experienced reductions in forced outages of about 25% and improvements in availability of about 10%, with the largest results occurring 3-5 years after unbundling.

The Impact of Electricity Sector Restructuring on Coal-fired Power Plants in India

We examine whether the unbundling of generation from transmission and distribution services at state-owned power plants in India improved operating efficiency at these power plants. Between 1995 and 2009, 85 percent of coal-based generation capacity owned by state governments was unbundled from vertically integrated State Electricity Boards into state generating companies. We find that generating units in states that unbundled before the Electricity Act of 2003 experienced reductions in forced outages of about 25% and improvements in availability of about 10%, with the largest results occurring 3-5 years after unbundling. We find no evidence of improvements in thermal efficiency at state-owned power plants due to unbundling.

The Impact of Electricity Sector Restructuring on Coal-Fired Power Plants in India

We examine whether the unbundling of generation from transmission and distribution services at state-owned power plants in India improved operating efficiency at these power plants. Between 1995 and 2009, 85 percent of coal-based generation capacity owned by state governments was unbundled from vertically integrated State Electricity Boards into state generating companies. We find that generating units in states that unbundled before the Electricity Act of 2003 experienced reductions in forced outages of about 25% and improvements in availability of about 10%, with the largest results occurring 3-5 years after unbundling. We find no evidence of improvements in thermal efficiency at state-owned power plants due to unbundling.

Why Are Power Plants in India Less Efficient than Power Plants in the United States?

India's coal-fired generating capacity doubled between 1990 and 2010 and currently accounts for 70 percent of electricity produced. Despite this, thermal efficiency at state-owned coal-fired power plants in India is significantly lower than at plants in the United States. When matched on age and capacity, heat input per kWh was 8 percent higher at Indian plants between 1997 and 2009. This can only partly be explained by the lower heat content of Indian coal. Electricity sector restructuring in the United States improved thermal efficiency at investor-owned plants; however, electricity sector restructuring in India has yet to improve thermal efficiency at state-owned coal-fired power plants.

The Failure of Market Fundamentalism

This paper argues that neoliberalism’s global restructuring of electricity sectors has failed to deliver its proclaimed objectives and spawned threats to economic growth, financial market stability, environmental degradation, and society’s well-being. Using the case study of Australia, the paper’s régulationist analysis reveals the short-term outcomes and longer-term consequences of this restructuring, and concludes that the paradox of this structural change is the creation of inherent risks to the accumulation process. JEL Classification: B52, D02, L94, Z18

A new form of energy poverty is the hallmark of liberalised electricity sectors

The restructuring of electricity sectors has resulted in households paying significantly higher prices. Some European prices rose by more than 100 per cent between 2000 and 2010. NSW households experienced an 80 per cent increase during the period 2007 to 2012. Growing numbers of low‐income and vulnerable households are spending higher proportions of disposable income on energy bills and, we contend, suffer deprivation and social exclusion as a result. This phenomenon, we posit, is a new form of energy poverty driven by rapidly rising electricity prices which are directly related to electricity sector restructuring. The energy‐impoverished population is estimated at 150 million in Europe, and growing. Policy responses are ineffective and poorly targeted, while Australian policy makers rely on measures which significantly understate electricity price changes. This article explores the prevalence and consequences of the problem of energy poverty and outlines the extent of its occurrence in Australia, the country hailed as an exemplar of electricity sector liberalisation.

Performance evaluation and improvement directions for an Indian electric utility

This study evaluates the performance of 29 Electricity Distribution Divisions (EDDs) of an Indian state – Uttarakhand – deploying Input oriented Data Envelopment Analysis (DEA). The results indicate that the performance of several EDDs is sub-optimal, suggesting the potential for cost reductions and possible reduction in employees number. In the DEA method more than one unit are identified as efficient. Therefore, this study suggests a method for ranking the efficient units by their importance as benchmarks for the inefficient units through benchmark share measure. The bigger the benchmark share, the more important an efficient division is in benchmarking for inefficient ones. Result reveals that plain area divisions are relatively efficient and have higher potential to influence the performance of inefficient EDDs. This study is envisaged to be instrumental to policy makers and managers to increase the operational efficiency of inefficient EDDs and thereby increase the competitiveness in the face of restructuring and liberalization of Indian electricity sector.

Electricity markets: an overview and comparative study

PurposeThe electric power industry has been moving from a regulated monopoly structure to a deregulated market structure in many countries. The purpose of this study is to comprehensively review the existing markets to study advantages, issues involved and lessons learnt to benefit emerging electricity markets.Design/methodology/approachThe paper employs a comprehensive review of existing competitive electricity market models in USA (California), UK, Australia, Nordic Countries (Norway), and developing country (Chile) to analyze the similarities, differences, weaknesses, and strengths among these markets based on publically available data, literature review and information.FindingsOngoing or forthcoming electricity sector restructuring activities in some countries can be better designed based on lessons learnt from existing markets and incorporating their own political, technical and economical contexts. A template for design of successful electricity market has also been presented.Research limitations/implicationsThis study is limited to a comparative analysis of five markets and can be extended in the future for other existing and emerging electricity markets.Practical implicationsThe discussed weaknesses and strengths of existing electricity markets in this study can be practically utilized to improve the electricity industry market structures leading to several social benefits including lower electricity cost.Originality/valueThe comprehensive review and analysis of five existing markets, physically located in different continents, may be used as an assistance or reference guide to benefit the emerging electricity markets in other countries.

Analysis of critical field procedures for power HV overhead transmission line splices installed after restructuring of Brazilian electrical sector

The electricity transmission system lines in the Brazilian re-structured market is the subject on this work. Also are studied transmission lines field procedures considering economy and reliability of ACSR (Aluminum Core Steel Reinforced) cables and compression splices. The work describes compression splices field surveys with suppliers and users concessionaires and also suggest some procedures and inspections routines to improve system reliability.

Broken dreams: Unmet expectations of investors in the Philippine electricity restructuring and privatization

Over the last three decades, privatization and restructuring of electricity sectors has been a hot topic. The expectation was that prices would fall due to increased competition and that generators would become more innovative and efficient. However, the enthusiasm for deregulation wavered after events such as the debacle in California, the fall of Enron and the setbacks of Ontario. In the Philippines, comprehensive legislation was passed in 2001 but the implementation has been rather slow and controversial. This paper looked at the allegation of politicizing power rates and found a logical alternative to the perceived conspiracy angle. Based on market data, it is highly probable that depressed market rates was a result of coping mechanisms of new players trying to adjust to the restructured industry.

ELECTRICITY RESTRUCTURING IN CHINA: HOW COMPETITIVE WILL GENERATION MARKETS BE?

The continuation of China's remarkable economic growth will depend on continued increases in electricity supply. China has commenced a program of electricity sector restructuring, with the announced aim of relying on markets and competition to provide incentives for attracting private investment and encouraging efficiency. However, a close examination of the generation markets being created suggests that truly free wholesale prices are likely to be both high and volatile. This may be the reason that these prices have not yet been freed — and it may not bode well for true market liberalization in the future.

A New Approach to Remuneration of Ancillary Services Provided by Generation Agents in Brazil

The restructuring of electrical sector based on the market resulted in the separation of generation, transmission and distribution agents and in the operation costs discrimination. This process lead to the necessity to separate the different services provided by the agents with the objective of organize by function and to define methodologies to identify who offers and who uses these services, as well as methodologies of remuneration to same ones. In this way, the present work presenting studies and methodologies to remunerate some Ancillary Services, such as: Black-start, Active Power Reserve, Special Protection Systems and Reactive Power Support. The studies and methodologies proposed were accomplished starting from the Ancillary Services provided by large Brazilian generation agents.

Restructuring the Electricity Sector in the EU and in Russia

Summary: Power sector restructuring has been a major issue since the 1980s. The insight that only transmission and distribution are natural monopolies, whereas generation and supply are activities of a competitive nature has triggered mammoth restructuring processes in different countries. Today the efforts to liberalise electricity markets are by no means slowing-down. On the contrary, important steps to set up the necessary legal framework have been taken all over the world. This means that the interesting phase of ensuring competitive markets and effective regulation is going on now. Of all the countries undergoing power sector reforms, developments in European countries and in Russia are particularly interesting at the moment: The European Commission has just presented a proposal for the so called Third Energy Package, thus introducing further steps to accomplish the liberalisation of the European electricity markets. Russia, having launched a mammoth reform process as well, is undergoing the restructuring of the monopoly of RAO UES coupled with rising foreign investments. This contribution reviews the background and the basic steps of the reforms in Europe and in Russia. In doing so it aims to highlight some key elements of electricity sector restructuring, which are being addressed in both Europe and Russia in a more or less similar manner. Furthermore, there are lessons about power sector restructuring in general that can be learned from these experiences.

Electricity Restructuring in China: The Elusive Quest for Competition

The continuation of China's remarkable economic growth will depend on continued increases in electricity supply. China has commenced a program of electricity sector restructuring, with the announced aim of relying on markets and competition to provide incentives for attracting private investment and encouraging efficiency. However, a close examination of the generation markets being created suggests that truly free wholesale prices are likely to be both high and volatile. This may be the reason that these prices have not yet been freed - and it may not bode well for true market liberalization in the future.