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Distributed Electricity Generation in Competitive Energy Markets: A Case Study in Australia

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  • Deepak Sharma and Robert Bartels
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    Abstract

    The electricity industry in Australia has recently undergone significant restructuring. Generation, transmission and distribution have been unbundled and placed under private or public corporate ownership. Industry restructuring, together with concerns about the environment, have resulted in a noticeable increase in distributed electricity generation, especially small-scale generation. This development has important ramifications for the electricity industry and the wider economy. This paper provides an empirical analysis of the recent growth in distributed electricity generation in Australia, and analyzes the factors driving this resurgence of interest. The paper also attempts to identify the underlying factors contributing to the development of distributed generation. Past and current distributed generation projects are classified according to which technical or institutional factor was dominant in the realization of each project. This enables us to identify changes over time in the rationale for distributed generation. A comparative analysis of the developments in the different Australian states provides additional insights into the roles played by factors such as geography, the availability of low-cost industrial by-products for fuel, and the introduction of competitive markets.

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    Bibliographic Info

    Article provided by International Association for Energy Economics in its journal The Energy Journal.

    Volume (Year): Volume 18 (1997)
    Issue (Month): Special Issue ()
    Pages: 17-40

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    Handle: RePEc:aen:journl:1997si-a02

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    Cited by:
    1. John Foster & Liam Wagner & Phil Wild & Junhua Zhao & Lucas Skoofa & Craig Froome & Ariel Liebman, 2011. "Market and Economic Modelling of the Intelligent Grid: End of Year Report 2010," Energy Economics and Management Group Working Papers 10, School of Economics, University of Queensland, Australia.
    2. Heikki Kemppi & Adriaan Perrels, 2003. "Liberalised Electricity Markets - Strengths and Weaknesses in Finland and Nordpool," Research Reports 97, Government Institute for Economic Research Finland (VATT).
    3. Kunneke, Rolf W., 1999. "Electricity networks: how 'natural' is the monopoly?," Utilities Policy, Elsevier, vol. 8(2), pages 99-108, June.
    4. Aghdam, Reza Fathollahzadeh, 2011. "Dynamics of productivity change in the Australian electricity industry: Assessing the impacts of electricity reform," Energy Policy, Elsevier, vol. 39(6), pages 3281-3295, June.

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