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Electricity pricing in China and the role of the State

Author

Listed:
  • John Beirne

    (European Central Bank)

  • Guy Liu

    (Brunel University)

  • Liang Zhang

    (Brunel University)

Abstract

Theoretical and empirical evidence is presented to show that inefficient power firms in China are subsidised by the state through the ability to charge high electricity prices and the creation of a “soft price constraint” on costs. This cost inefficiency challenges the merits of planned power supply.

Suggested Citation

  • John Beirne & Guy Liu & Liang Zhang, 2012. "Electricity pricing in China and the role of the State," Economics Bulletin, AccessEcon, vol. 32(1), pages 466-474.
    • Handle: RePEc:ebl:ecbull:eb-12-00104
    as

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    File URL: http://www.accessecon.com/Pubs/EB/2012/Volume32/EB-12-V32-I1-P43.pdf
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    References listed on IDEAS

    as
    1. Bateson, Jeff & Swan, Peter L, 1989. "Economies of Scale and Utilization: An Analysis of the Multi-plant Generation Costs of the Electricity Commission of New South Wales, 1970/71-1984/85," The Economic Record, The Economic Society of Australia, vol. 65(191), pages 329-344, December.
    2. Lam, Pun-Lee, 2004. "Pricing of electricity in China," Energy, Elsevier, vol. 29(2), pages 287-300.
    3. repec:hal:wpspec:info:hdl:2441/7069 is not listed on IDEAS
    4. Wang, Bing, 2007. "An imbalanced development of coal and electricity industries in China," Energy Policy, Elsevier, vol. 35(10), pages 4959-4968, October.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    planned supply of power; electricity industry; pricing behaviour; soft price constraint; China's enterprise reform;
    All these keywords.

    JEL classification:

    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior

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