The Economics of Restructuring the German Electricity Sector
Christian Growitsch, Felix Müsgens
Zeitschrift für Energiewirtschaft,
No. 3,
2005
Abstract
The debate about the development of German electricity prices after the liberalization of energy markets in 1998 raises the question of failures in market restructuring. However, a general statement would be misleading for two main reasons. Firstly, the price development, analyzed for the exemplary case of household prices, shows significant differences among the stages of the value chain. Secondly, the underlying cost structure might have changed from 1998 to 2004. While such effects can be expected to level out over time, they can distort the comparison of a small period of observation. For these reasons, we analyzed the different price components at a detailed level, finding a considerable price reduction of about 32% in generation and a much lower reduction of 13% in transmission and distribution tariffs. These decreases have been mostly compensated by a significant increase in taxes and subsidies (+56%).
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An analysis of household electricity price developments in Germany since liberalization
Christian Growitsch, Felix Müsgens
Externe Publikationen,
2005
Abstract
Despite the liberalization of energy markets in 1998, household electricity prices in 2004 are nearly the same as 1998, indicating a failure of market restructuring. However, such a general consideration is misleading for two main reasons. Firstly, the price development shows significant differences among the stages of the value chain. Secondly, the underlying cost structure might have changed from 1998 to 2004. While such effects can be expected to level out over time, they can distort the comparison of a small period of observation. For these reasons, we analyzed the different price components at a detailed level, finding a considerable price reduction of about 32% in generation and a much lower reduction of 13% in transmission and distribution tariffs. These decreases have been mostly compensated by a significant increase in taxes and subsidies (+56%).
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Revenue Implications of Trade Liberalization
L. Ebrill, Reint E. Gropp, J. Stotsky
IMF Occasional Papers, No. 180,
No. 180,
1999
Abstract
In recent decades many countries have dismantled trade barriers and opened their economies to international competition. Trade liberalization is seen to promote economic efficiency, international competitiveness, and an expansion of trade, perhaps especially in imperfectly competitive markets. Yet despite this progress in trade liberalization, as evidenced by the conclusion of the Uruguay Round in 1994 and the establishment of the World Trade Organization (WTO) in 1995, trade barriers are still widespread. Some economies and some sectors (e.g., agriculture in many industrial countries) remain relatively insulated from the global economy by a variety of nontariff and tariff barriers, even as import substitution continues to lose ground as a strategy for economic development.
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