Power Market Structure and Performance
Unbundling power generation, transmission, and distribution is not an end itself, but rather a means to achieve better performance. The key objective of the analytical framework of this paper is to explore the links between alternative market struc...
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| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2012
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| Online Access: | http://documents.worldbank.org/curated/en/2012/07/16481794/power-market-structure-performance http://hdl.handle.net/10986/11933 |
| Summary: | Unbundling power generation,
transmission, and distribution is not an end itself, but
rather a means to achieve better performance. The key
objective of the analytical framework of this paper is to
explore the links between alternative market structures and
performance (in terms of access, price, quality, and
technical and financial performance). The results are
crucial for providing policy advice, by offering alternative
options to policy makers based on the lessons learned from
the taxonomy of different market structures, tailored to
different national contexts. The analysis is based on unique
data, including a panel of 22 countries for the period
beginning in 1989 and extending through 2009. The results of
the analysis carried out for this study confirm the
following conclusions for policy guidance on power market
restructuring for developing countries. First, unbundling
delivers results in terms of several performance indicators
when used as an entry point to implement broader reforms,
particularly introducing a sound regulatory framework,
reducing the degree of concentration of the generation and
distribution segments of the market by attracting public and
private players and private sector participation. Second,
there seems to be a credible empirical basis for selecting a
threshold power system size and per capita income level
below which unbundling of the power supply chain is not
expected to be worthwhile. Finally, partial forms of
vertical unbundling do not appear to drive improvements,
probably because the owner was able to continue exercising
control over the affairs of the sector and hinder the
development of competitive pressure within the power market. |
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