Introducing Competition in the French Electricity Supply Industry: The Destabilisation of a Public Hierarchy in an Open Institutional Environment

The French electricity supply industry is characterized by a vertically integrated monopoly and public ownership and when the government introduced market rules, it was with the aim of preserving the integration of the public incumbent as a national champion. This had two paradoxical effects in favour of competition development and the building of safeguards for entrants

Introducing Competition in the French Electricity Supply Industry: The Destabilisation of a Public Hierarchy in an Open Institutional Environment

The French electricity supply industry is characterized by a vertically integrated monopoly and public ownership and when the government introduced market rules, it was with the aim of preserving the integration of the public incumbent as a national champion. This had two paradoxical effects in favour of competition development and the building of safeguards for entrants: 1/ the creation of a credible regulatory governance structure with effective power of control on network access which promoted market-rules, and the creation of a power exchange for balancing the incumbent’s dominant position; 2/ the credibility of the regulatory framework by the self-control of the incumbent in the use of its dominant position and on the capture of the regulator. These two effects result from the influence of the European institutional environment, in particular the intensive scrutiny of the European Commission, which is superposed on the national one.regulation, electricity

A Competitive Fringe in the Shadow of a State Owned Incumbent: The Case of France

We examine what kind of competitive fringe has been built in France around the State owned incumbent without destroying it or significantly weakening its dominant position; what impacts has this particular reform process on the market in which the incumbent monopolist is still overly dominant; and what more can be done to strengthen the opening of the market while staying in this typical French policy framework (no industrial restructuring and no forced divestiture by the monopolist). We wonder if a larger window of opportunity will open up at some later date for contesting the position of the monopolist, especially when investment in generation resumes

The liberalisation of the European gas market and its consequences for Russia

Russia is the world's biggest natural gas producer, with output of 581 bn m3 in 2001, and is also a key supplier of the European gas market (around 30% of current EU gas imports). Therefore gas exports rank with oil exports as an essential variable of Russian economic policy, and anyinstitutional evolution of its gas export markets is crucial for Russia's economy as well as its gas industry. Liberalisation of the European gas market will have major consequences for main suppliers, and therefore for Russia.LIBERALISATION ; MARCHE ; GAZ NATUREL ; RUSSIE ; EUROPE

The failure of introducing market institutions in a rent sector into an economy in transition

Privatisation is at the heart of the structural reforms for economies in transition. In theory, the main aim of privatisation is to change the structures of corporate governance in order to improve the efficiency of the enterprises and to assure their long-term future in a competitive environment. The adoption of formal market institutions would be sufficient to secure the new property rights, in particular because the new holders of the rights to control assets would have a great incentive to encourage the definition of new judicial rules that would guarantee their rights of ownership. In Russia that didn't happen.privatisation;changement institutionnel;droits de propriété;industrie gazière;industrie pétrolière

On the Road to a Unified Market for Energy Efficiency: The Contribution of White Certificates Schemes

White certificates schemes mandate competing energy companies to promote energy efficiency with flexibility mechanisms, including the trading of energy savings. So far, stylized facts are lacking and outcomes are mainly country-specific. By comparing results of British, Italian and French experiences, we attempt to identify the core determinants of their performances. We show that (i) white certificates schemes are depicted in theoretical works as mandatory subsidies on energy efficiency goods recovered by an end-use energy tax, whereby white certificates exchanges are not a central feature; (ii) at current stages, existing schemes are cost-effective and economically efficient, with large discrepancies though; (iii) the hybrid subsidy-tax mechanism seems valid but conditional to cost pass through permissions; otherwise, obliged energy companies merely promote information on the “downstream” side (i.e. at the consumer level); (iv) although white certificates exchange between different types of actors involved can be important as in Italy, trade among obliged companies is negligible; instead, flexibility sustains vertical relationships between obliged parties and “upstream” partners (i.e. installers, energy service companies). In this respect, we support the view that white certificates schemes are a policy instrument of multi-functional nature (subsidisation, information, technology diffusion), whose static and dynamic efficiency depends upon the consistency between a proper definition of long-term energy savings, the appropriate cost-recovery permission and a fine coordination with other instruments. We finally propose a four stages deployment pattern, along which fragmented markets for energy efficient technologies get closer to create a unified market delivering energy efficiency as a homogeneous good.White Certificates Schemes, Static Efficiency, Dynamic Efficiency, Vertical Organisation, Policy Coordination

The Static and Dynamic Efficiency of Instruments of Promotion of Renewables

This paper deals with a comparative analysis of the economic and social efficiency of the instruments used to promote renewable energy sources (RES), first from a static standpoint and then using dynamic criteria to assess their ability to stimulate technological progress and cost reduction. First, the instruments are analysed in relation to the classical discussion of environmental policy that opposes price-based instruments versus quantity-based instruments in an uncertain environment (feed-in tariffs as price based system on one hand, quotas + green certificates, competitive bidding as quantity-based instruments on the other hand). Next, the incentives to invest and innovate in the context of each framework are analysed in relation to the sharing of the surplus associated with each of them between producers/constructors and consumers or the public budget. Finally, the paper looks at the overall cost-efficiency of the policies on the basis of each instrument, by referring to factual evidence in European experiences. It concludes that if social preference is attached to climate change prevention and reflected in a high quantitative objective for renewables, sliding scale feed-in tariffs are a good compromise in order to promote technical progress and national RES industry also. The quota/certificate system also presents a number of advantages in terms of static efficiency, but its ability to stimulate innovation still has to be confirmed by experience.énergies renouvelables;progrès technologique;certificat vert

Pros and cons of alternative policies aimed at promoting renewables

Following a brief review of the rationale for promoting renewable energy sources, this paper compares alternative policies to promote the production of renewable electricity. The focus is on feed-in tariffs (used in Germany, Spain, and France - for instance) and tradable green certificate (TGC) systems (United Kingdom and Italy, for instance). Considering economic theory and practical experience, the criteria for comparing these two alternatives are: cost-effectiveness, environmental effectiveness, and compatibility with market liberalisation. The paper argues that economic theory does not suggest a clear-cut advantage of one instrument over the other and it emphasises that, in any event, the choice of instrument depends on the relative importance attached to these criteria and on cultural factors such as faith - or lack thereof - in markets to help solve environmental problems. In this context, the paper questions the practical usefulness of a European-wide TGC system

Pour une reconnaissance d’une valeur de référence du carbone dans l’accord Climat

Cired Working PaperL'échec du protocole de Kyoto montre qu'il est impossible de s'entendre dans un accord sur le développement d'un prix mondial du carbone qui nécessiterait des engagements contraignants autour des quotas d'émissions. Ceci dit, reconnaître la nécessité d'une valeur de référence du carbone aligné sur la valeur économique et sociale des actions de réduction des émissions ne serait pas vain. Une telle valeur de référence guiderait les décisions d'investissement bas carbone et permettrait d'asseoir de nouveaux modes de financement qui prendrait en compte la valeur d'abattement du carbone qui est mal internalisée par une taxe ou un prix d'ETS. Les décisions de long terme des entreprises et des administrations publiques en matière d'équipements bas carbone, de programmes d'infrastructures (bâtiments, mode de transport, urbanisme) qui ont un surcoût par rapport aux options ordinaires auraient besoin de se baser sur un signal-prix du carbone crédible pour se déclencher. Les agents auraient besoin de se référer à la rentabilité sociale de l'investissement et non pas seulement à sa rentabilité privée. Une telle valeur de référence du carbone permettrait aussi d'asseoir de nouveaux modes de financement innovants qui ne soient pas simplement des arrangements permettant le partage de risque qui sont actuellement proposés et qui reposeraient sur la création d'un actif carbone correspondant aux économie de carbone des projet bas carbone, dont la valeur serait garantie par les Etats et les banques centrales. Au bout du compte, comme l'usage d'un tel prix de référence du carbone ne pèsera pas sur le capital technique en place et les émissions correspondantes, il a beaucoup moins d'effets redistributifs et ne heurte pas de front les intérêts industriels. On pourrait donc s'entendre plus facilement sur la reconnaissance de sa nécessité dans le traité que celle d'engagements ou de prix contraignants. Plus tard cette non-pénalisation des équipements de départ et de leurs émissions permettra de s'entendre sur une valeur élevée et rapidement croissante, nécessaire ppour déclencher des investissements bas carbone très lourds en capital

Electricité : La variété des trajectoires institutionnelles d'électrification

Une analyse de l'histoire de l'électrification des pays développés montre qu'il n'y a pas eu de voie institutionnelle et financière unique pour structurer et organiser l'industrie électrique et l'étendre ensuite aux zones rurales. Une variété des trajectoires de cinq décennies riche en enseignements pour les pays émergents et en développement qui doivent aujourd'hui assurer l'achèvement de leur programme d'électrification.électrification; régime institutionnel; OCDE