Ownership Unbundling of Electricity Distribution Networks

Paul Nillesen and Michael Pollitt
Authors registered in the RePEc Author Service: Michael Gerald Pollitt

Economics of Energy & Environmental Policy, 2021, vol. Volume 10, issue Number 1

Abstract: Traditional restructuring of power markets has focused on legally separating monopolistic transmission and distribution infrastructure with sufficient regulatory oversight to ensure non-discriminatory access to networks, and transparent and cost-reflective tariffs. There is consensus that ownership separation for transmission assets is beneficial for competition and transparency. However, at the distribution level the benefits of going beyond legal unbundling are questionable. This paper reviews the theoretical arguments for ownership unbundling and summarises the findings from 23 academic papers and consulting reports. In addition, this paper empirically demonstrates that forced distribution ownership unbundling in New Zealand (from 1998) and the Netherlands (from 2009) did not increase retail competition and did not increase network quality. It resulted in significant one-off and structural costs. The combination of increasingly active distribution networks with bi-directional power flows from distributed renewables, in combination with the digitalisation of energy supply and creation of distribution data platforms, suggests that interaction between networks and customers, traditionally separated from a regulatory and competition perspective may become more interlinked in future. Policymakers should therefore assess a broader set of policy measures, taking into account this changing network landscape, when focusing on increasing retail competition and network quality.

JEL-codes: F0 (search for similar items in EconPapers)
Date: 2021
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.iaee.org/en/publications/eeeparticle.aspx?id=358 (text/html)
Access to full text is restricted to IAEE members and subscribers.

Related works:
Working Paper: Ownership Unbundling of Electricity Distribution Networks (2019)
Working Paper: Ownership Unbundling of Electricity Distribution Networks (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aen:eeepjl:eeep10-1-nillesen

Ordering information: This journal article can be ordered from
http://www.iaee.org/ ... ons/eeepjournal.aspx

Access Statistics for this article

More articles in Economics of Energy & Environmental Policy from International Association for Energy Economics Contact information at EDIRC.
Bibliographic data for series maintained by David Williams ().