 The Restructuring and Privatisation of Electricity Distribution and Supply Businesses in England and Wales: A Social Cost Benefit AnalysisPreetum Domah and Michael Pollitt Cambridge Working Papers in Economics from Faculty of Economics, University of Cambridge Abstract: In December 1990, the twelve regional electricity companies responsible for the distribution and supply of electricity in England and Wales were privatised. For the first few years following privatisation, real prices, profits and costs in the industry rose. Following two price control reviews, prices have now fallen sharply and there have been substantial reductions in costs and, more recently, in profits. This paper attempts to conduct a social cost benefit analysis of the privatisation by examining actual and predicted falls in costs over the period to 2005. The authors conclude that the privatisation did yield net benefits but that these were unevenly distributed across time and groups in society. Relative to our preferred counterfactual, the gains to consumers are equivalent to 3% lower prices, and the government gains £5bn in sales proceeds and net taxes. However, consumers only begin to gain from 2000. Keywords: Cost benefit analysis; Electricity; Productivity; Privatisation; Restructuring (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:cam:camdae:0007 Access Statistics for this paper More papers in Cambridge Working Papers in Economics from Faculty of Economics, University of Cambridge |
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