Essays on regulation, liberalization and privatization in energy markets
- Autores: Carlos Andrés Suárez Acosta
- Directores de la Tesis: Joan-Ramon Borrell Arqué (dir. tes.), Germà Bel i Queralt (codir. tes.)
- Lectura: En la Universitat de Barcelona ( España ) en 2020
- Idioma: español
- Materias:
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- Resumen
Resumen de la Tesis: The general motivation of this research is to explore the effects of the coexistence of public and private companies on the allocative efficiency of the supply of electricity. In particular, this thesis investigates from an empirical perspective to what extent the distinction between private and public companies is relevant to understand the competition in the wholesale electricity generation markets. I apply several econometric techniques and theory advances in industrial organization branch on data of the firms of the Colombian market.
The case of the Colombian electricity market is suitable to study this issues for four reasons: i) It is an oligopoly in which private and public companies compete under the same rules. ii) The most important firms in the Colombian electricity sector are mature organizations, with a conventional business vision. In fact, many of these companies belong to transnational capital that carry out activities in several continents. iii) The market setting have a conventional design similar to other liberalized electricity markets. It operates as a multi-unit uniform-price auction. iv) There is available information with daily and even hourly resolution of the generation market variables. I consider that these are key elements for justifying the external validity of the results.
This thesis presents three essays that aim to answer three questions related to the interaction between competition in electricity markets and their ownership structure. Chapter 1 addresses the question: Do the switch from public to private management have impacts in the bidding strategy of specific generation assets? Chapter 2 explores the question: Do public and private generation companies respond the same to the incentives to relax competition? Chapter 3 focuses on the question: Do private companies have a greater propensity to establish coordination relationships in comparison to public firms? In the first chapter of this thesis I evaluate the impact of privatization on the bidding of electricity units participating in a liberalized wholesale electricity market. The results of this evaluation contribute to better understand whether privatization is the right decision in an environment of imperfect competition.
In this essay I adopt a policy evaluation approach to estimate the impact of changes from public to private management on the bidding prices of electricity generation units. I use information of bidding prices of the Colombian wholesale electricity market and exploit the changes of management of generation units documented in the period 2006 - 2018. The methodologies and results presented in this thesis contributes to the literature of mixed oligopoly because they place special emphasis on the behavioral differences between private and public companies and studies a field experience in which they compete in the same relevant market. The empirical evidence resultant from the policy evaluation method is aligned with the theoretical predictions of comparative statics arising from the behavioral differences of mixed oligopoly models.
The second chapter of this dissertation proposes a methodology in order to find differences between the reactions of private and public firms when they face incentives to exercises unilateral market power. Several common events in the electricity industry such as transmission restrictions, the concentration of generation property within specific areas, the non-storage capacity of electricity and the low elasticity of demand, provide opportunities to exert market power. That is why this issue has been widely studied and discussed theoretically and empirically. The novel element of this essay in relation to this strand of the literature is accounting for the distinction
