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Introducing Competition in the French Electricity Supply Industry: the destabilisation of a public hierarchy in an open institutional environment

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  • Dominique Finon

    (Institut d'Economie et de Politique de l'Energie, CNRS and Grenoble University, France)

Abstract

The French electricity supply industry is characterized by a vertically integrated monopoly and public ownership and when the government introduced market rules, it was with the aim of preserving the integration of the public incumbent as a national champion. This had two paradoxical effects in favour of competition development and the building of safeguards for entrants: 1/ the creation of a credible regulatory governance structure with effective power of control on network access which promoted market-rules, and the creation of a power exchange for balancing the incumbent’s dominant position; 2/ the credibility of the regulatory framework by the self-control of the incumbent in the use of its dominant position and on the capture of the regulator. These two effects result from the influence of the European institutional environment, in particular the intensive scrutiny of the European Commission, which is superposed on the national one.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Dominique Finon, 2003. "Introducing Competition in the French Electricity Supply Industry: the destabilisation of a public hierarchy in an open institutional environment," Working Papers EP21, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
    • Handle: RePEc:enp:wpaper:ep21
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    References listed on IDEAS

    as
    1. Baumol, William J, 1982. "Contestable Markets: An Uprising in the Theory of Industry Structure," American Economic Review, American Economic Association, vol. 72(1), pages 1-15, March.
    2. Brunekreeft, Gert & Keller, Katja, 2000. "The electricity supply industry in Germany: market power or power of the market?," Utilities Policy, Elsevier, vol. 9(1), pages 15-29, March.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Jean-Michel Glachant and Dominique Finon, 2005. "A Competitive Fringe in the Shadow of a State Owned Incumbent: The Case of France," The Energy Journal, International Association for Energy Economics, vol. 0(Special I), pages 181-204.
    2. Jean-Michel Glachant & Dominique Finon, 2005. "A Competitive Fringe in the Shadow of a State Owned Incumbent: The Case of France," The Energy Journal, , vol. 26(1_suppl), pages 181-204, June.
    3. Jacques Pelkmans & Lionel Kapff, 2010. "Interconnector Investment for a Well-functioning Internal Market. What EU regime of regulatory incentives?," Bruges European Economic Research Papers 18, European Economic Studies Department, College of Europe.
    4. Eva Niesten, 2006. "Regulatory Institutions And Governance Transformations In Liberalising Electricity Industries," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 77(3), pages 291-307, September.
    5. Haas, R. & Auer, H., 2006. "The prerequisites for effective competition in restructured wholesale electricity markets," Energy, Elsevier, vol. 31(6), pages 857-864.
    6. Adrien de Hauteclocque & Yannick Perez, 2011. "Law & Economics Perspectives on Electricity Regulation," RSCAS Working Papers 2011/21, European University Institute.

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    More about this item

    Keywords

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    JEL classification:

    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • L98 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Government Policy

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