Restructuring Of Electricity Sector Research Articles

The Unified Energy Systems of Russia (RAO-UES) in Central Asia and the Caucasus: Nets of Interdependence

Abstract: Most Central Asian and Caucasus countries have, to some extent, transformed and privatized their electricity sectors using the World Bank's advice. In recent years, the Russian parastatal Unified Energy Systems of Russia (RAO-UES) has purchased much of the generation and transmission assets that were made available. This article examines the transformation of the post-Soviet electricity sector. The author explores how RAO-UES became the most important foreign investor, even in states that have problematic relations with Moscow, the advantages and disadvantages of RAO-UES participation for the successor states, and the energy security implications of the grid as it now exists for these southern states. Keywords: Caucasus energy, Central Asia energy, electricity sector restructuring, politics of electricity, RAO-UES, Russian electricity grid Introduction Although oil and gas have received the most attention from the international community, something remarkable has been happening in Russian electricity generation. In the fall of 2003, the former Soviet republics began operating on a parallel, integrated grid for the first time. (1) This long-dreamed-of goal of Soviet planners was finally accomplished under the corporate leadership of the Russian Joint-Stock Company--Unified Energy Systems of Russia (henceforth RAO-UES). Synchronization of the grid means that the electrical generators across the post-Soviet space are operating in coordination with each other and that shortfalls in one area can be made up with surpluses from another. The coordination has been maintained by the eleven states of the CIS Electric Energy Council but led by RAO-UES. Since coming under RAO-UES's leadership, the member states have seen an increase in the quality and reliability of their electricity. But in several states the energy security implications continue to raise concerns. The Russian idiom for an electricity network is rather than the English grid. Are the successor states of the Soviet Union becoming caught up in a net of electricity dependency? This article examines the reasons for the ascendancy of RAO-UES in Central Asia and the Caucasus--regions where acquisitions have been recent and extensive. It will also examine the ways in which each of the concerned states has attempted to constrain RAO-UES or to allow the corporation to pursue acquisitions while safeguarding the state's own interests. RAO-UES RAO-UES has not merely synchronized the grid covering the former Soviet space. The corporation has reorganized and, in large measure, purchased it. With ownership of an installed capacity of 157.7 million kilowatts and 2,479,000 kilometers of transmission lines, (2) the RAO-UES Holding Company has an enormous footprint. By comparison, Electricite de France--the largest electricity company in Europe--has only 130.7 million kilowatts of installed capacity. (3) RAO-UES is a parastatal corporation in which the Russian state holds controlling shares. According to its annual report, the Russian state owns 52.68 percent of the company's shares, a figure that has remained constant for years. (4) RAO-UES owns 72 percent of the electricity generation capacity in the Russian Federation, and 96 percent of its transmission capacity. (5) RAO-UES is considered relatively transparent and commercially successful. Standard and Poor's rating services gave RAO-UES a credit rating of ruA+ (highest ranking in Russia) in 2004 and an overall rating of B+, indicating that it is one of the most promising investments in Russia. RAO-UES has been led by CEO Anatoly Chubais, a well-known and controversial oligarch in Moscow, since 1999. Often credited as the architect of the first wave of post-Soviet privatization, his portfolio includes having served as first deputy prime minister in the first Yeltsin administration, Yeltsin's campaign manager in the 1996 campaign, and presidential chief of staff in the second Yeltsin administration. …

Market power monitoring and mitigation in the US wholesale power markets

Under current statutory requirements, the Federal Energy Regulatory Commission (FERC) must ensure that prices in US wholesale power markets are ‘just and reasonable’. This has been interpreted by the agency and the courts as requiring the monitoring and mitigation of undue market power. This paper focuses on generation market power. Prior to electricity sector restructuring, wholesale bilateral power trading took place among vertically integrated monopoly utilities trading at the margin or between small independent producers and the utilities. Under those conditions, the authorization of trading at market prices, called ‘market-based rates’, required only that the generation supplier pass a simple market share screen for market power. As restructuring unfolded, and market conditions changed, there has been a steady evolution in FERC's market power mitigation rules, encompassing (a) changes in the market power assessment required for granting market-based rates and related methods for merger approval, and (b) development and refinement of new techniques for screening and mitigating offers into the organized day-ahead and real-time markets operated by Independent System Operators (ISOs) and Regional Transmission Organizations (RTOs). This paper reviews these changes to date, as FERC continues to clarify its approved rules and procedures. It also examines recent methods for quantitative market power analysis that could augment current procedures or supplant them, as found appropriate.

05/01583 Electricity sector restructuring in India: An environmentally beneficial policy?

05/01583 Electricity sector restructuring in India: An environmentally beneficial policy?

05/01908 Development and restructuring of Turkey's electricity sector: A review: Hepbash, A. Renewable and Sustainable Energy Reviews, 2005, 9, (4),311–343

05/01908 Development and restructuring of Turkey's electricity sector: A review: Hepbash, A. Renewable and Sustainable Energy Reviews, 2005, 9, (4),311–343

Electricity Restructuring In Ontario

This paper examines the short-lived electricity sector restructuring initiative of the province of Ontario, Canada’s largest province. In May 2002, following years of planning and consultation Ontario opened its retail and wholesale electricity markets to competition. The summer of 2002 saw retail prices reach levels that consumers had never previously encountered. By December 2002, the provincial government froze retail electricity prices, covering approximately half of Ontario’s electricity consumption. While the weather played a significant role in driving prices higher during the summer of 2002, other factors also played a major role. The other factors reviewed in this paper fall into two categories. The first category consists of market design problems, such as market rules (e.g., trading arrangements) and market structure (e.g., the degree of competition in the generation sector). The second category covers political economy problems, in particular the lack of political will to allow retail prices to reflect wholesale prices and to address effectively structural problems in the sector. Finally, this paper examines some of the new restructuring initiatives being pursued by the recently elected provincial government of Ontario as the province continues to struggle to bring order to its electricity sector.

Estratégias competitivas no setor elétrico brasileiro: uma análise dos interesses e expectativas dos atores da Chesf

O estudo focaliza aspectos políticos e estratégicos relativos à atividade de transmissão de energia da Chesf, considerando os possíveis impactos causados pelo processo de reestruturação e privatização do setor elétrico brasileiro. Foram realizadas entrevistas com stakeholders estratégicos, investigando interesses e expectativas da empresa e as mudanças ocorridas no contexto institucional recente, buscando-se demarcar fronteiras e atribuições a serem delineadas para a Chesf. Como resultado, foi-lhe sugerido adotar mecanismos mais competitivos e estruturas mais ajustadas à ambiência institucional de mudanças tecnológicas, de novas regras e de convivência com agentes em condições de parcerias estratégicas, visando à busca de novas oportunidades de negócios e de maior rentabilidade dos investimentos.

ELECTRICITY SECTOR RESTRUCTURING AND COMPETITION: LESSONS LEARNED

ABTRACT We now have over a decade of experience with the privatization, restructuring, regulatory reform, and wholesale and retail competition in electricity sectors around the world. The objectives and design attributes of these reform programs are reviewed. The improvements in sector performance that have been achieved are discussed. The nature and sources of performance problems are also reviewed. Several lessons learned from this experience are identified and their implications for successful ongoing electricity reform initiatives presented. Electricity sector restructuring, regulatory reform and competition initiatives can yield significant consumer benefits when these reforms are designed and implemented well. Applying the lessons learned from recent experience can yield larger consumer benefits in the future.

Electricity sector restructuring in India: an environmentally beneficial policy?

It has been suggested that reforms to the electricity sector in developing countries encouraging the entry of independent power producers (IPPs) are likely to result in environmental improvements similar to those recently made in a number of developed economies. The present paper evaluates this claim by examining the experience of the Indian power sector. It finds that recent investments by IPPs have reduced the pollution-intensity of electricity generation in the country. Yet they have not brought the significant gains seen in countries such as the UK, nor are they likely to in the foreseeable future. This is largely a product of the nature and context of electricity sector reform in India which is less favourable to environmentally beneficial outcomes. Accordingly, the paper concludes by suggesting that the environmental benefits of restructuring are not automatic, but depend on the existence of an enabling structural, institutional and regulatory framework.

Electric sector restructuring in Italy

In this paper, the author describes how Italian electricity supply industry restructuring is moving at a rapid pace, with many generators entering the production sector, a new ISO entrusted with the transmission function and tariffs that will gradually eliminate existing cross-subsidies.

Poland and the EU Electricity Directive

Poland has entered the preaccession phase of the integration process with the European Union (EU). The Polish electric power sector is proving its capability of meeting the challenges posed by the accession and, in the process, may facilitate unavoidable transformation in other areas of the Polish economy. The currently implemented legislation related to the electric power sector in Poland conforms to the IEM 96/9UEC Directive. As a consequence of Polish electric power sector restructuring, separation of generation, transmission and distribution was introduced in 1990. The generation subsector consists of over 30 generation companies, with a total installed capacity amounting to 34000 MW and with gross annual electricity generation amounting to 142 TWh. The transmission subsector is represented by the Polish Power Grid Company as transmission system operator (TSO) and is preparing itself to play the role of the operator in the balancing market. The focus is on a phased opening of the internal electricity market for internal competition, restructuring and privatization of the electric power sector, and fuel supply sectors.

An Institutional Approach to Electricity Sector Restructuring: The Case for Consumer Aggregation

Social and environmental problems attributed to current electricity sector restructuring structures are spelled out. The energy source choices and market power of large industrial and commercial users versus residential consumers are compared. An institutional analytic approach is used to reveal the best option to alleviate the social and environmental problems associated with electricity restructuring. Community aggregation emerges with great potential to achieve meaningful social and environmental improvement.

Electricity sector restructuring in Belgium during the 90's

Since 1925, the Belgian liberal statutory framework, combined with weak supervision by public authorities, allowed the Tractebel conglomerate and its subsidiary Electrabel to strengthen in the nineties their dominant position in all parts of the Belgian electricity market. The implementation of the EU internal market of electricity directive speeded up the process of market liberalisation. However, the urgency of the law-giving process and the traditionally overwhelming power of the incumbent interests of the Tractebel conglomerate will bring about a merely formalistic opening of the Belgian electricity market.

Electricity Sectors in Transition

This paper discusses the structural and regulatory changes that are affecting electricity sectors around the world. The direction of change is toward promoting competition in the supply of generation services, restructuring of electricity supply enterprises to clearly separate the provision of competitive generation services from monopoly transmission and distribution services, and the application of new regulations governing access to the transmission and distribution networks and the associated costs of the services provided by these networks. The potential impacts of these changes on electricity costs and prices, economic development, the distribution of income, the choice of generating technologies, research and development and the environment are discussed. Differences in the current performance and the likely future impacts of electricity sector restructuring on developing and developed countries are discussed.

Liberalization of India's electric power sector: evolution or anarchy?

The past two years have seen the bloom off the rose of India's highly promising electricity sector restructuring. But take heart: Dabhol and other disappointments that may have seemed like a nightmare through much of 1995 may be only a mid-course correction in a robust restructuring that has still a long and promising distance to travel.