The Restructuring and Privatisation of the Electricity Supply Industry in Northern Ireland: Will it be Worth it?

Michael Pollitt

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

Abstract: Until 1992, the electricity supply industry in Northern Ireland was controlled by a single state-owned enterprise. It was then restructured into three new generating companies and a transmission and distribution company, all of which were privatised. Since then, unit costs have fallen sharply but prices have risen relative to the rest of the United Kingdom. This paper conducts a social cost benefit analysis of the restructuring and privatisation by looking at the efficiency gains and the actual and future investment and environmental effects of the process. It concludes that relative to the central counterfactual, the net gains are equivalent to a permanent cost reduction of 6% per annum, consumers pay 13% higher prices, while the government gains around £1.3bn in asset sales and higher tax revenue.

Date: 1997
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Persistent link: https://EconPapers.repec.org/RePEc:cam:camdae:9701

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