Liberalization in energy sector during last two decades added more private players due non activeness of state energy corporations. As was presumed due to liberalization the competition and availability will be increase horizontally to in region but it not happened rather vertically increased in urban areas with higher prices. rural consumer even more desperate to have it in even at high costs and that what they want. There very few companies / public sector to stand even in this scenario so it will further pose bargaining risk to the consumers.
If you see the evolution of the European prices, especially in those countries where markets liberalisation happened more recently, you discover increases in the prices (without considering the inflation).
The real truth about liberalisation of strategic markets such as electricity, at least in EU, is that former companies are acting as oligopolies at national level. So, in my opinion, liberalisation is good if the competition takes place. But, it would be necessary a high level of institutional control.
Hello, I study fuel/energy poverty in New Zealand, where we have a relatively deregulated electricity industry compared with other OECD countries. In NZ despite fairly high rates of consumer switching and an increasing number of retailers residential electricity prices have increased significantly since deregulation. This is most keenly felt by those living in or at risk of fuel poverty, and those using prepayment metering.
For a good overview you may be interested in the following:
Beder, S. (2003). Power Play: The Fight to Control the World's Electricity. New York: The New Press.
For more on the NZ example see:
Bertram, G., & Twaddle, D. (2005). Price-cost margins and profit rates in New Zealand electricity distribution networks since 1994: the cost of light handed regulation. Journal of Regulatory Economics, 27(3), 281-308.
Howden-Chapman, P., Viggers, H., Chapman, R., O'Dea, D., Free, S., & O'Sullivan, K. (2009). Warm homes: drivers of the demand for heating in the residential sector in New Zealand. Energy Policy, 37(9), 3387-3399. (I would highlight Figure 2 in this paper as particularly relevant to your question.)
In relation to the effect of deregulation on fuel poor consumers see:
O'Sullivan, K. C., Howden-Chapman, P., & Fougere, G. (2011). Making the connection: the relationship between fuel poverty, electricity disconnection and prepayment metering. Energy Policy, 39, 733-741. doi:10.1016/j.enpol.2010.10.046
I hope that you find this useful. Best wishes, Kimberley
This topic is still very much disputed in academia and I have the feeling that describing the debate as "believing in" the pros of liberalization or not fits at least the public debate in the U.S. and EU better, than speaking of scientific evidenceon this topic. I recommend you to have a look at the following works:
Erdugdu, E. (2013) The impact of power market reforms on electricity price-cost margins and cross-subsidy levels: A cross country panel data analysis Energy Policy, 2013, 39:3, 1080–1092
Rosen, R.; Sverrisson, F. & Stutz, J. (2000) Can Electric Utility Restructuring Meet the Challenges it has Created? Tellus Institute, Boston, 2000
Iimi, A. (2003) Economies of Scale in Power Generation, Transmission and Distribution: Integration or Unbundling? Working Paper of Japan Bank for International Cooperation (JBIC) Institute.