Competition Considerations in Change Ownership Reforms for Electric Cooperatives

Carlos Vega, Jestoni Olivo, Antonio Miguel Ventura and Eirene Gillian Reyes
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Carlos Vega: University of East Anglia, School of Economics
Jestoni Olivo: Economics Office, Philippine Competition Commission
Antonio Miguel Ventura: Economics Office, Philippine Competition Commission
Eirene Gillian Reyes: University of the Philippines College of Law

No 202504, UP School of Economics Discussion Papers from University of the Philippines School of Economics

Abstract: Change ownership reforms for electric cooperatives (ECs) have once again attracted policymakers’ interest due to current efforts in expediting their privatization. This note serves as input to this ongoing conversation using the lens of competition. We argue that unchecked consolidation - especially vertical integration along the power supply chain from generation to distribution - may cause more pernicious effects on the industry and welfare than existing inefficiencies of ECs. Consistent with Canlas & Jandoc (2025), we support a franchise competition regime where the threat of displacement may foster an overall competitive behavior among existing and potential players. The necessary conditions for and the challenges to implementing an effective competition for the market framework are determined.

Keywords: market imperfections; legal monopolies; regulation or deregulation; electric utilities (search for similar items in EconPapers)
JEL-codes: D43 L43 L94 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2025-08
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Published as UPSE Discussion Paper No. 2025-04, August 2025

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