Power Market Structure
: Competition Law Enforcement and Electricity Security

  • Francisca Kusi-Appiah

Student thesis: Doctoral ThesisDoctor of Philosophy

Abstract

Market reforms in the electricity sector along with the introduction of competition into the electricity markets has led to both state-owned enterprises and private enterprises operating in the same electricity markets although the states or national institutions regulate the electricity markets. Often developing countries have their electricity markets dominated by state-owned enterprises. Competition is said to be the fuel for economic development and consumer protection. Electricity security has been the leading priority for regulation within the electricity sector because electricity is tied to the economic development of nations, especially that of developing countries. In the electricity sector, competition is considered as an essential ingredient for electricity security.

The examination of how competition law enforcement affects electricity security was carried out within the United Kingdom (England & Wales and Scotland) and the United States of America (PJM) power markets. The comparative research between the UK and the USA power markets indicate that there is a direct link between the enforcement of competition law in the electricity sector with regards to the generation of electricity as the increase in generators enhanced the availability of the electricity for consumption. However, no direct link was established between affordability and the use of clean energy as regulatory institutions had to intervene in the electricity markets by introducing special programmes or subsidies, aside the enforcement of competition laws in order to enhance those indicators.

The lessons learnt from the comparative analysis is applied to a sub-Saharan developing country with a capacity short environment, Ghana, and points out the options available to developing country in order to enhance electricity security. Ghana is a capacity short power market with state-owned enterprises dominating the market, just like most sub-Saharan African developing countries. Competition enforcement in Ghana is not as robust as exist in the UK and the USA. The focus of the Ghanaian government is to enhance affordability and access to electricity. Therefore, the regulators in Ghana intervene to enhance electricity security. Competition at the regional level is higher than at the national level because the state is only a player at the regional level.The research indicates that all regulators of power markets, be it capacity excess markets or capacity short markets, have the same options and that different choices made by regulators result in different outcomes. The focus of the UK and the USA was on pricing of electricity while the focus of Ghanaian regulators was on socio-economic issues.
Date of Award2016
Original languageEnglish
SupervisorStephen Dow (Supervisor) & Peter Cameron (Supervisor)

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