IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/87725.html
   My bibliography  Save this paper

The Market Testing of Power Supply Agreements: Rationale and Design Evolution in the Philippines

Author

Listed:
  • Fabella, Raul

Abstract

We first set out the rationale for the emerging policy of the Competitive Selection Process (CSP) which mandates market testing the Power Supply Agreements (PSA) of Distribution Utilities in the Philippines. It will potentially address several possible market failures such as connected dealings (“sweetheart deals,” in common parlance) with proprietary GENCOS, lack of incentives for DUs to procure at lowest cost, abuse of market power by large GENCOS in certain localities, etc. It will also potentially lighten the regulatory load of the Energy Regulatory Council (ERC) by replacing the burdensome and politically-sensitive accounting method of evaluating PSAs. It may also attract additional generation capacities by new players. Lower generation cost―and finally, lower prices for consumers―is also a possibility, but not guaranteed. We then discuss the evolution of the design of the CSP over the last two years and how the simplest and best modality was finally arrived at.

Suggested Citation

  • Fabella, Raul, 2016. "The Market Testing of Power Supply Agreements: Rationale and Design Evolution in the Philippines," MPRA Paper 87725, University Library of Munich, Germany, revised Aug 2016.
    • Handle: RePEc:pra:mprapa:87725
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/87725/1/MPRA_paper_87725.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Hayek, F. A., 1991. "The Fatal Conceit," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226320663 edited by Bartley, III, W. W., September.
    2. Fabella, Raul V, 1993. "Consumer Resistance and Monopoly Behavior under Franchise Contestability," Public Choice, Springer, vol. 76(3), pages 263-271, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ravago, Majah-Leah & Fabella, Raul & Alonzo, Ruperto & Danao, Rolando & Mapa, Dennis, 2016. "Filipino 2040 Energy: Power Security and Competitiveness," MPRA Paper 87721, University Library of Munich, Germany, revised Jan 2018.
    2. Mondal, Md Alam Hossain & Rosegrant, Mark & Ringler, Claudia & Pradesha, Angga & Valmonte-Santos, Rowena, 2018. "The Philippines energy future and low-carbon development strategies," Energy, Elsevier, vol. 147(C), pages 142-154.
    3. Nori Tarui, 2017. "Electric utility regulation under enhanced renewable energy integration and distributed generation," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 19(3), pages 503-518, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Klaus Jaffe, 2015. "Agent based simulations visualize Adam Smith's invisible hand by solving Friedrich Hayek's Economic Calculus," Papers 1509.04264, arXiv.org, revised Nov 2015.
    2. Kimbrough, E.O. & Vostroknutov, A., 2012. "Rules, rule-following and cooperation," Research Memorandum 053, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
    3. Agnès Festré & Pierre Garrouste, 2009. "The economic analysis of social norms: A reappraisal of Hayek’s legacy," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 22(3), pages 259-279, September.
    4. Bigoni, Maria & Camera, Gabriele & Casari, Marco, 2020. "Money is more than memory," Journal of Monetary Economics, Elsevier, vol. 110(C), pages 99-115.
    5. Horst Feldmann, 2009. "The quality of the legal system and labor market performance around the world," European Journal of Law and Economics, Springer, vol. 28(1), pages 39-65, August.
    6. Hirokazu Takizawa, 2017. "Masahiko Aoki’s conception of institutions," Evolutionary and Institutional Economics Review, Springer, vol. 14(2), pages 523-540, December.
    7. Kevin Vallier, 2017. "Gaus, Hayek, and the place of civil religion in a free society," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 30(3), pages 327-352, September.
    8. Arnaud Lacan, 2022. "Value-Based Governance as a Performance Element in Social and Solidarity Economy Organizations: A French Sustainable Post-Modern Proposal," Post-Print hal-03620280, HAL.
    9. Göbel, Jürgen, 2009. "Hayek’s approach to cognitive and social order," MPRA Paper 14290, University Library of Munich, Germany.
    10. Niclas Berggren, 2009. "Choosing one’s own informal institutions: on Hayek’s critique of Keynes’s immoralism," Constitutional Political Economy, Springer, vol. 20(2), pages 139-159, June.
    11. Peter J. Boettke & Christopher J. Coyne & Peter T. Leeson, 2015. "Institutional stickiness and the New Development Economics," Chapters, in: Laura E. Grube & Virgil Henry Storr (ed.), Culture and Economic Action, chapter 6, pages 123-146, Edward Elgar Publishing.
    12. Fabella, Raul V., 1995. "The social cost of rent seeking under countervailing opposition to distortionary transfers," Journal of Public Economics, Elsevier, vol. 57(2), pages 235-247, June.
    13. Asoni, Andrea, 2008. "Colonial Heritage and Economic Development," Working Paper Series 758, Research Institute of Industrial Economics.
    14. Jason Brennan, 2013. "Is Market Society Intrinsically Repugnant?," Journal of Business Ethics, Springer, vol. 112(2), pages 271-281, January.
    15. Agnès Festré, 2015. "Michael Polanyi's Economics: A Strange Rapprochement," GREDEG Working Papers 2015-36, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France, revised Oct 2018.
    16. Emily Chamlee-Wright & Justus Myers, 2008. "Discovery and social learning in non-priced environments: An Austrian view of social network theory," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 21(2), pages 151-166, September.
    17. Michael Munger, 2012. "Voting methods, problems of majority rule, and demand-revealing procedures," Public Choice, Springer, vol. 152(1), pages 61-72, July.
    18. Michael Wohlgemuth, 2011. "Is there a Paradox of a Hayekian Paternalist?," Papers on Economics and Evolution 2011-22, Philipps University Marburg, Department of Geography.
    19. Douglas Whitman, 1998. "Hayek contra Pangloss on Evolutionary Systems," Constitutional Political Economy, Springer, vol. 9(1), pages 45-66, March.
    20. L.A. Kormishkina & N.N. Semenova, 2016. "Monitoring of Food Security in the Russian Federation: Methodology and Assessment," European Research Studies Journal, European Research Studies Journal, vol. 0(3A), pages 185-202.

    More about this item

    Keywords

    competitive selection; power supply contracts; market failures; outsourcing to market;
    All these keywords.

    JEL classification:

    • K2 - Law and Economics - - Regulation and Business Law
    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:87725. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.