1 / 24

Service Quality Regulation in Electricity Distribution

Service Quality Regulation in Electricity Distribution. Necmiddin BAĞDADİOĞLU Orçun SENYÜCEL. Objectives. Incorporate service quality measure into electricity regulation. New in literature : Growitsch et al (2008), Coelli et al (2008-Draft)

fitzgerald-goodman
Download Presentation

Service Quality Regulation in Electricity Distribution

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Service Quality Regulation in Electricity Distribution Necmiddin BAĞDADİOĞLU Orçun SENYÜCEL

  2. Objectives • Incorporate service quality measure into electricity regulation. New in literature : Growitsch et al (2008), Coelli et al (2008-Draft) Determine technical efficiency of Turkish electricity distribution utilities • Focus on exogeneous determinants of inefficiency • Analyze effects of electricity losses and illegal usage on TE.

  3. Turkish Electricity Reform • Electricity Sector Reform and Privatization Strategy Paper (2004): TEDAS  2012 • Transitory period: 20 utilites through mergers of 79 distribution utilities. • ESRPSP: mergers determined by operational problems, technical & financial features. • Turkey accession country. EU Energy Acquis • EMRA has not announced regulatory framework

  4. Briefly SFA v DEA Average Cost (all noise)Syrjanen, M., P. Bogetoft, P. Agrell (2006)

  5. Briefly SFA v DEA Deterministic frontier (all ineff  u)Syrjanen, M., P. Bogetoft, P. Agrell (2006)

  6. Briefly SFA v DEA Stochastic frontier (both noise v and ineff u) Syrjanen, M., P. Bogetoft, P. Agrell (2006)

  7. Briefly SFA • Two component error terms, first captures statistical noise • Second captures effects of TE. • Half normal, exponential, truncated dist.

  8. Distance Functions • DF: Distance of the prod to PPB • Two different types: input & output DF • Input DF: How much input vector can be contracted (output constant) • Output: Vice versa.

  9. y y0 xo x/λ x L(y) Distance Functions Kumbhakar & Lovell (2003)

  10. Distance Functions • Deviations from 1 is technical inefficiency • h(.) represents deviation exp (-u) • exp (-u) one of the component error terms.

  11. Distance Functions • Adding random error term, imposing homogeneity rest. • We preffered translog input DF.

  12. Methodology • Following Coelli, (M outputs K inputs)

  13. Methodology • Following Coelli and Battese, • Two environmental variables

  14. Models • Model I: Input: TOTEX+L&IEU (TOTEXL) • Model II: Input: + Interruption Time (ITC) • Output: Energy supplied (ENG) and number of customers (CUST) • Environmental factors: • Village Cust Density (VCD) • Geographic Conditions (GEO)

  15. Model I

  16. Model II

  17. Descriptive Statistics

  18. Model I Note: ***, ** and * denotes significance at the 1, 5 and 10 % levels.

  19. Model I RTS=0.93=

  20. Model II Note: ***, ** and * denotes significance at the 1, 5 and 10 % levels.

  21. Model II RTS=1.06

  22. Average efficiency scores QoS has significant effect: TE decreased by 16.5% LLR test also states QoS important

  23. Average efficiency scores

  24. Conclusion • QoS impact on TE. GEO & VCD are crucial environmental variables. • Excl. losses and illegal electricity usage overestimates TE. • Privatization: Eight utilitiesare established far from the optimal size and have low average efficiency scores (0.43). TPA may merge other six utilities.

More Related