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

Dominique Finon

Cambridge Working Papers in Economics from Faculty of Economics, University of Cambridge

Abstract: 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.

Keywords: regulation; electricity (search for similar items in EconPapers)
JEL-codes: L14 L22 L51 L94 L98 (search for similar items in EconPapers)
Pages: 22
Date: 2003-02
New Economics Papers: this item is included in nep-com, nep-ene and nep-ind
Note: CMI IO
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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