The impact of electricity market liberalization in Turkey "Free consumer" and distributional monopoly cases

Date

2008-07-01

Author

Bahce, Serdal
Taymaz, Erol

Metadata

Show full item record

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Item Usage Stats

174
views

0
downloads

Electricity sector has grown substantially in Turkey since the early 1960s as a result of rapid industrialization and urbanization. The vertically integrated state-owned company had a legally established monopoly on the generation, transmission and distribution of electricity in Turkey. With the support and encouragement of international organizations like the World Bank, Turkey has initiated a comprehensive program to liberalize and privatize the electricity market in 2001. The liberalization of the electricity market in Turkey started in the distribution side of the market. The distribution network was divided into 21 distribution regions and in each of these, separate - initially state-owned - disbibution companies have been authorized to distribute and sell electricity. The plan envisaged to complete privatization of all distribution companies until the end of 2006. This study compares the welfare implication of privatization of the distribution networks by comparing two extreme cases, a pure regional distributional monopoly case and a representative pure "free" consumer case, with a benchmark case of administered price regulation. For this purpose, we develop a simulation model of the Turkish electricity system, and use the data on generation and distribution costs. Our simulation analysis shows that substantial welfare losses occur if the distributional companies behave as regional monopolists. Our findings reiterate the importance of regulation and market design.

Subject Keywords

General Energy, Economics and Econometrics

URI

https://hdl.handle.net/11511/36451

Journal

ENERGY ECONOMICS

DOI

https://doi.org/10.1016/j.eneco.2007.03.003

Collections

Department of Economics, Article

Suggestions

OpenMETU
Core

Relationship between oil prices, interest rate, and unemployment: Evidence from an emerging market Dogrul, H. Gunsel; Soytaş, Uğur (Elsevier BV, 2010-11-01) While the interrelation between oil price changes, economic activity and employment is an important issue that has been studied mainly for developed countries, little attention has been devoted to inquiries on fluctuations in the price of crude oil and its impact on employment for small open economies. Adopting an efficiency wage model for equilibrium employment that does not require any assumptions regarding labor supply, this paper contributes to the literature by investigating the causality between unemp...
The impact of value added components of GDP and FDI on economic freedom in Europe SAYARI MARCUM, NAZ; Sarı, Ramazan; Hammoudeh, Shawkat (Elsevier BV, 2018-06-01) This paper investigates the possibility of a long-run relationship between the Economic Freedom Index (EFI), Foreign Direct Investment (FDI) and value added components of GDP in thirty Eastern, Central and Western European countries. The study further examines whether the FDI and sector-specific components of GDP have any significant impact on economic freedom for these countries. We use annual data and employ Pedroni and KAO panel cointegration analyses to assess the long-run relationships. The results ind...
The asymmetric impact of oil prices, interest rates and oil price uncertainty on unemployment in the US Kocaarslan, Baris; SOYTAŞ, MEHMET ALİ; Soytaş, Uğur (Elsevier BV, 2020-02-01) In this study, we investigate the presence of asymmetric interactions between oil prices, oil price uncertainty, interest rates, and unemployment in a cointegration framework. Utilizing the nonlinear auto-regressive distributed lag (NARDL) approach, we show the asymmetric responses of unemployment to changes in oil prices, oil price uncertainty and interest rates in the long-run. More specifically, the results of our analyses suggest that an increase in oil price results in increased unemployment while ther...
The potential and economic viability of wind farms in Ghana Asumadu-Sarkodie, Samuel; Owusu, Phebe Asantewaa (2016-01-01) The current load shedding in Ghana has led to decreasing productivity leading to economic and social crisis due to Ghana's dependency on hydroelectric power as its main source of power. Incorporating renewable energy sources to the grid installed capacity will ease the burden on Ghanaians. In this study, the potentiality and economic feasibility of wind farm project were evaluated in 11 locations in Ghana. The study employed wind-speed data using Meteonorm 7 software in a Typical Meteorological Year 2 forma...
Efficiency analysis of turkish natural gas distribution companies by using dea method Ertürk, Mehmet; Aşık, Serap; Department of Economics (2009) The history of natural gas in Turkey started in 1970s by the usage of domestic gas in cement factories. However, natural gas began penetrating the energy market in 1980s with the usage of natural gas in Ankara. In the following years, the number of cities using natural gas reached six. Then, a new era started with the enactment of Natural Gas Market Law in 2001 and 53 distribution tenders have been realized by Energy Market Regulatory Authority until 2009. This thesis analyzes the performance of 38 Turkish ...

Citation Formats

S. Bahce and E. Taymaz, “The impact of electricity market liberalization in Turkey “Free consumer” and distributional monopoly cases,” ENERGY ECONOMICS, pp. 1603–1624, 2008, Accessed: 00, 2020. [Online]. Available: https://hdl.handle.net/11511/36451.