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Energy Reforms and Consumer Prices in the EU over twenty Years

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  • Massimo Florio

Abstract

To what extent have the European households benefited from the energy reforms of the last two decades in the EU? The core ingredients of change have been, in different proportions and timing across countries: privatization of formerly state-owned enterprises, unbundling of networks, market liberalization and regulation. This paper summarizes some empirical findings of a team of researchers at the University of Milan about the impact of the reforms on energy prices (1990-2007) for EU-15 households. Econometric testing of the impact of the reforms (measured by OECD/ECTR scores) on prices of electricity and gas finds that public ownership of the incumbents is correlated with lower prices for households; unbundling per se has no statistically significant effect; the evidence about liberalization is mixed. Price inertia, sources of primary energy in electricity, and oil price in gas are still the core price determinants. Customers' satisfaction with prices confirms these findings. There is some evidence that consumers are subjectively happy with the opportunity to switch their electricity supplier, even if the objective evidence about the actual benefit of doing this is limited.

Suggested Citation

  • Massimo Florio, 2014. "Energy Reforms and Consumer Prices in the EU over twenty Years," Economics of Energy & Environmental Policy, International Association for Energy Economics, vol. 0(Number 1).
  • Handle: RePEc:aen:eeepjl:3-1-a03
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    Cited by:

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    3. Hyland, Marie, 2016. "Restructuring European electricity markets – A panel data analysis," Utilities Policy, Elsevier, vol. 38(C), pages 33-42.
    4. Proskuryakova, Liliana & Starodubtseva, Alena & Bianco, Vincenzo, 2020. "Modelling a household tariff for reducing sectoral cross-subsidies in the Russian power market," Energy, Elsevier, vol. 213(C).
    5. da Silva, Patrícia Pereira & Cerqueira, Pedro A., 2017. "Assessing the determinants of household electricity prices in the EU: a system-GMM panel data approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 73(C), pages 1131-1137.
    6. Gaffney, F. & Deane, J.P. & Gallachóir, B.P.Ó, 2017. "A 100 year review of electricity policy in Ireland (1916–2015)," Energy Policy, Elsevier, vol. 105(C), pages 67-79.
    7. David Hall & Tue Anh Nguyen, 2017. "Electricity Liberalisation in Developing Countries," Progress in Development Studies, , vol. 17(2), pages 99-115, April.

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