Are households better off in liberalized electricity markets

the Nordic case

Ole Jess Olsen, Tor Arnt Johnsen, Merja Pakkanen

    Publikation: KonferencebidragKonferenceabstrakt til konferenceForskning

    Resumé

    The electricity supply industry used to be a regulated monopoly often dominated by state-owned and municipal enterprises. The Nordic countries - Denmark, Finland, Norway and Sweden - were no exception. During the nineties they liberalized their electricity supply industry and created an integrated wholesale market. Norway was first (1991), then came Finland and Sweden (1996) and Denmark was last (2000). Together with the UK the Nordic countries are now considered the avantgarde with respect to implementation of the European electricity market directives. The purpose of liberalization is to increase economic efficiency without sacrificing important public values such as universal service obligations, quality of service and high environmental standards.

    Liberalization and the introduction of competition are often considered synonymous with deregulation, which is a misunderstanding. Before the electric utilities mostly acted under very little surveillance and the authorities only intervened in specific cases of abuse. The separation of operational and regulatory functions was far from clear-cut - state and municipal agencies often had both functions. Today much more detailed principles of regulations administrated by independent regulatory agencies have been developed. The purpose of this paper is to analyze the situation for Nordic household consumers after liberalization of the electricity supply industry. A number of new regulatory principles have been introduced and some of them with particular regard to small customers. Do Nordic households actively use the new options for switching supplier and choosing a market contract that fits their preferences? How has liberalization influenced their supply costs? This is a question of market prices as well as of charges for using the distribution and transmission network. These networks are still regulated monopolies but have been exposed to new regulatory principles. Have problems with respect to universal service or social obligations occurred as a consequence of liberalization? The outcome so far is different for the four countries. Many Norwegian and Swedish households are actively using the new market opportunities whereas Danish and Finnish have been much more passive. The experience with respect to regulation and prices is mixed. In none of the countries have important public values been sacrificed as a consequence of liberalization.

    OriginalsprogEngelsk
    Publikationsdato2007
    Antal sider1
    StatusUdgivet - 2007
    BegivenhedPublic Administration and the Management of Diversity, 2007 EGPA Annual Conference - Madrid, Spanien
    Varighed: 19 sep. 200721 sep. 2007

    Konference

    KonferencePublic Administration and the Management of Diversity, 2007 EGPA Annual Conference
    LandSpanien
    ByMadrid
    Periode19/09/200721/09/2007

    Citer dette

    Olsen, O. J., Johnsen, T. A., & Pakkanen, M. (2007). Are households better off in liberalized electricity markets: the Nordic case. Abstract fra Public Administration and the Management of Diversity, 2007 EGPA Annual Conference, Madrid, Spanien.
    Olsen, Ole Jess ; Johnsen, Tor Arnt ; Pakkanen, Merja. / Are households better off in liberalized electricity markets : the Nordic case. Abstract fra Public Administration and the Management of Diversity, 2007 EGPA Annual Conference, Madrid, Spanien.1 s.
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    Olsen, OJ, Johnsen, TA & Pakkanen, M 2007, 'Are households better off in liberalized electricity markets: the Nordic case' Public Administration and the Management of Diversity, 2007 EGPA Annual Conference, Madrid, Spanien, 19/09/2007 - 21/09/2007, .

    Are households better off in liberalized electricity markets : the Nordic case. / Olsen, Ole Jess; Johnsen, Tor Arnt; Pakkanen, Merja.

    2007. Abstract fra Public Administration and the Management of Diversity, 2007 EGPA Annual Conference, Madrid, Spanien.

    Publikation: KonferencebidragKonferenceabstrakt til konferenceForskning

    TY - ABST

    T1 - Are households better off in liberalized electricity markets

    T2 - the Nordic case

    AU - Olsen, Ole Jess

    AU - Johnsen, Tor Arnt

    AU - Pakkanen, Merja

    PY - 2007

    Y1 - 2007

    N2 - The electricity supply industry used to be a regulated monopoly often dominated by state-owned and municipal enterprises. The Nordic countries - Denmark, Finland, Norway and Sweden - were no exception. During the nineties they liberalized their electricity supply industry and created an integrated wholesale market. Norway was first (1991), then came Finland and Sweden (1996) and Denmark was last (2000). Together with the UK the Nordic countries are now considered the avantgarde with respect to implementation of the European electricity market directives. The purpose of liberalization is to increase economic efficiency without sacrificing important public values such as universal service obligations, quality of service and high environmental standards.Liberalization and the introduction of competition are often considered synonymous with deregulation, which is a misunderstanding. Before the electric utilities mostly acted under very little surveillance and the authorities only intervened in specific cases of abuse. The separation of operational and regulatory functions was far from clear-cut - state and municipal agencies often had both functions. Today much more detailed principles of regulations administrated by independent regulatory agencies have been developed. The purpose of this paper is to analyze the situation for Nordic household consumers after liberalization of the electricity supply industry. A number of new regulatory principles have been introduced and some of them with particular regard to small customers. Do Nordic households actively use the new options for switching supplier and choosing a market contract that fits their preferences? How has liberalization influenced their supply costs? This is a question of market prices as well as of charges for using the distribution and transmission network. These networks are still regulated monopolies but have been exposed to new regulatory principles. Have problems with respect to universal service or social obligations occurred as a consequence of liberalization? The outcome so far is different for the four countries. Many Norwegian and Swedish households are actively using the new market opportunities whereas Danish and Finnish have been much more passive. The experience with respect to regulation and prices is mixed. In none of the countries have important public values been sacrificed as a consequence of liberalization.

    AB - The electricity supply industry used to be a regulated monopoly often dominated by state-owned and municipal enterprises. The Nordic countries - Denmark, Finland, Norway and Sweden - were no exception. During the nineties they liberalized their electricity supply industry and created an integrated wholesale market. Norway was first (1991), then came Finland and Sweden (1996) and Denmark was last (2000). Together with the UK the Nordic countries are now considered the avantgarde with respect to implementation of the European electricity market directives. The purpose of liberalization is to increase economic efficiency without sacrificing important public values such as universal service obligations, quality of service and high environmental standards.Liberalization and the introduction of competition are often considered synonymous with deregulation, which is a misunderstanding. Before the electric utilities mostly acted under very little surveillance and the authorities only intervened in specific cases of abuse. The separation of operational and regulatory functions was far from clear-cut - state and municipal agencies often had both functions. Today much more detailed principles of regulations administrated by independent regulatory agencies have been developed. The purpose of this paper is to analyze the situation for Nordic household consumers after liberalization of the electricity supply industry. A number of new regulatory principles have been introduced and some of them with particular regard to small customers. Do Nordic households actively use the new options for switching supplier and choosing a market contract that fits their preferences? How has liberalization influenced their supply costs? This is a question of market prices as well as of charges for using the distribution and transmission network. These networks are still regulated monopolies but have been exposed to new regulatory principles. Have problems with respect to universal service or social obligations occurred as a consequence of liberalization? The outcome so far is different for the four countries. Many Norwegian and Swedish households are actively using the new market opportunities whereas Danish and Finnish have been much more passive. The experience with respect to regulation and prices is mixed. In none of the countries have important public values been sacrificed as a consequence of liberalization.

    KW - Liberalized electricity markets

    KW - Households

    M3 - Conference abstract for conference

    ER -

    Olsen OJ, Johnsen TA, Pakkanen M. Are households better off in liberalized electricity markets: the Nordic case. 2007. Abstract fra Public Administration and the Management of Diversity, 2007 EGPA Annual Conference, Madrid, Spanien.