POLICY ALTERNATIVES IN REFORMING POWER UTILITIES IN DEVELOPING COUNTRIES: A CRITICAL SURVEY

Abstract

This paper examines the policy alternatives faced by developing countries in their endeavours to preserve and develop their electricity and gas systems, two service-oriented industries that - along with oil and coal - provide the bulk of the energy supply in both developed and developing countries. Even in very poor countries, industrially generated energy is indispensable for carrying out most economic activities. Therefore, Governments traditionally recognize that the supply of gas and electricity entails a fundamental public service dimension. Chapter I presents and defines the issues of liberalization, deregulation and privatization of energy utilities, and it attempts to locate energy reforms in a broader historical framework in which developing countries` Governments have faced increasing financial hardship. Chapter II reviews some experiences in energy sector reforms, focusing on some of the largest semi-industrialized countries in Latin America and Asia. A few remarks on the advisability of a flexible approach to reforming energy regimes in developing countries conclude the paper.