Rolf W. Künneke

Economic organization and liberalization of the electricity industry: In search of conceptualization

In this article a theoretical conceptualization of the liberalization of the electricity industry is developed. Three pure and six mixed coordination systems are identified. The main distinguishing factor is the choice of one of three different allocation systems (the price mechanism, voluntary agreement and governmental hierarchical authority) as a dominant or additional system. Based on this conceptualization, it is possible to operationalize the concept of liberalization, to distinguish it from the notions of privatization and regulation, and to model the relation between different sectoral organizations and different types of governmental regulation. The classification scheme is illustrated by applying it to four countries (the Netherlands, Germany, England and Wales, and France). The concept turns out to be useful in describing different organizational structures in the electricity industry, and in specifying the different degrees of liberalization already realized. Different national policy priorities are identified, and it is demonstrated that liberalization takes on very different meanings in different national settings. By taking account of these national approaches, future liberalization policies can be assessed.

Modelling welfare effects of a liberalisation of the Dutch electricity market

The Dutch electricity sector has traditionally been dominated by the public sector. Although this organisational structure resulted in a reliable and low-priced system, it is said not to be completely stable and efficient. National and international developments stimulate the introduction of a liberalised system. In this article, we present the model NEDMOD which is used to estimate possible welfare gains of an implementation of a liberalised market system in the Dutch electricity market.

National Models in the Emerging European Gas Market

The differing national heritage of gas market development determines specific positions held in the unfolding liberalization process. This chapter suggests a framework for comparative analysis of national responses to the emerging EU gas market liberalization and harmonization. The development of gas markets in Europe was guided by a specific focus on national gas policies. This chapter pursues this idea of focused guidance of gas market development as a point of departure to distinguish two different models for gas market development: a public property focused model, and a public utility focused model. The first model refers to the countries with voluminous gas fields and the public utility model refers to the countries without voluminous gas fields. In addition to these two models, the commodity focused model refers to a gas market where natural gas is perceived as a freely tradable commodity. This commodity-oriented model is now challenging all EU countries due to the EU Gas Directive. Liberalization has affected the image and perception of natural gas, which can no longer be considered only as public property or a public utility.

Dilemmas of Duality: Gas Market Reform in the Netherlands

Publisher Summary This chapter analyzes recent changes in the Dutch gas market and Dutch gas industry. It briefly summarizes the history of Dutch gas and then continues with the analyses of liberalization and its impact on the Dutch gas industry and the Dutch gas market. From the very beginning, the Netherlands adopted a public property orientation in national gas policies, combining long-term security of domestic gas consumption with a long-term strategic reserve policy. The strategy of overwhelming the country with natural gas turned out to be successful. The exploitation of the Dutch gas reserves was assumed to benefit the Dutch society as much as possible and state participation and taxation assured a flow of gas revenues to the national Treasury. The EU energy market harmonization debate forced the Netherlands to reconsider the prospects of Dutch gas production in the European context. The second point of debate concentrated on continuing the strategic depletion policy pursuing cost-effective exploitation of the small gas fields. The last, but not the least, point of debate concentrated on the impact of liberalization on gas revenues for the Treasury. The chapter ends with some final remarks on prospects of the Dutch gas industry.Publisher Summary This chapter analyzes recent changes in the Dutch gas market and Dutch gas industry. It briefly summarizes the history of Dutch gas and then continues with the analyses of liberalization and its impact on the Dutch gas industry and the Dutch gas market. From the very beginning, the Netherlands adopted a public property orientation in national gas policies, combining long-term security of domestic gas consumption with a long-term strategic reserve policy. The strategy of overwhelming the country with natural gas turned out to be successful. The exploitation of the Dutch gas reserves was assumed to benefit the Dutch society as much as possible and state participation and taxation assured a flow of gas revenues to the national Treasury. The EU energy market harmonization debate forced the Netherlands to reconsider the prospects of Dutch gas production in the European context. The second point of debate concentrated on continuing the strategic depletion policy pursuing cost-effective exploitation of the small gas fields. The last, but not the least, point of debate concentrated on the impact of liberalization on gas revenues for the Treasury. The chapter ends with some final remarks on prospects of the Dutch gas industry.

Chapter 6 – Dilemmas of Duality: Gas Market Reform in the Netherlands

Publisher Summary This chapter analyzes recent changes in the Dutch gas market and Dutch gas industry. It briefly summarizes the history of Dutch gas and then continues with the analyses of liberalization and its impact on the Dutch gas industry and the Dutch gas market. From the very beginning, the Netherlands adopted a public property orientation in national gas policies, combining long-term security of domestic gas consumption with a long-term strategic reserve policy. The strategy of overwhelming the country with natural gas turned out to be successful. The exploitation of the Dutch gas reserves was assumed to benefit the Dutch society as much as possible and state participation and taxation assured a flow of gas revenues to the national Treasury. The EU energy market harmonization debate forced the Netherlands to reconsider the prospects of Dutch gas production in the European context. The second point of debate concentrated on continuing the strategic depletion policy pursuing cost-effective exploitation of the small gas fields. The last, but not the least, point of debate concentrated on the impact of liberalization on gas revenues for the Treasury. The chapter ends with some final remarks on prospects of the Dutch gas industry.Publisher Summary This chapter analyzes recent changes in the Dutch gas market and Dutch gas industry. It briefly summarizes the history of Dutch gas and then continues with the analyses of liberalization and its impact on the Dutch gas industry and the Dutch gas market. From the very beginning, the Netherlands adopted a public property orientation in national gas policies, combining long-term security of domestic gas consumption with a long-term strategic reserve policy. The strategy of overwhelming the country with natural gas turned out to be successful. The exploitation of the Dutch gas reserves was assumed to benefit the Dutch society as much as possible and state participation and taxation assured a flow of gas revenues to the national Treasury. The EU energy market harmonization debate forced the Netherlands to reconsider the prospects of Dutch gas production in the European context. The second point of debate concentrated on continuing the strategic depletion policy pursuing cost-effective exploitation of the small gas fields. The last, but not the least, point of debate concentrated on the impact of liberalization on gas revenues for the Treasury. The chapter ends with some final remarks on prospects of the Dutch gas industry.

National Prospects in the Down of the Internal Gas Market

This chapter summarizes the changes in the national gas markets. The aim of this analysis is to compare national developments, to trace patterns in gas market development in Europe, and to assess the prospects of national positions in the emerging competitive internal gas market in Europe. This chapter comparatively analyzes the major developments in terms of structure, technology, and performance of gas markets in Europe, and focuses on functional developments in the European gas market. Prospects for further opening of national gas markets and the introduction of competition in these markets are quite promising when looking at the reforms and business dynamics thus far. The short-term prospects to relieve the political and institutional barriers are not that promising because their settlement touches the most sensitive issues such as national autonomy and national identity. The next step in the process to establish a competitive internal gas market in Europe needs to be decided at a national level, by national governments, national regulators, and national system operators.

Development and trends in East-Central Europe and Algeria

This chapter finalizes the overview of market developments by looking at some relevant countries in East–Central Europe and Algeria. It gives a more comprehensive understanding of relevant trends and developments that influence the restructuring of the EU gas markets. East–Central Europe is an interesting region as it provides transport corridors for Russian gas to the West European market. Algeria belongs to the important gas supplying countries of the EU. The regions addressed in this chapter are of quite different significance for the evolution of a European gas market. Gas markets in East–central Europe can be divided into two groups of countries comprising Northeast and Southeast–Central Europe. The reform of the national gas industries is in progress according to the requirements of the EU Directives. These countries attract foreign investment and their national gas markets are developing. Southeast–Central Europe is also an important corridor for Russian gas to Turkey and Greece and has some strategic importance for the long-term development of connections to gas supplies from the Caspian Sea and the Middle East. The stages of regulatory reform are quite different throughout these two regions. Overall political and institutional structures need to be strengthened. The gas market reform can only be successful as a part of this transition process.