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Measuring Potential Gains from Mergers among Electricity Distribution Companies in Turkey using a Non-Parametric Model

Necmiddin Bagdadioglu, Catherine Waddams Price, Thomas Weyman-Jones

Year: 2007
Volume: Volume 28
Number: Number 2
DOI: 10.5547/ISSN0195-6574-EJ-Vol28-No2-4
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Abstract:
Turkish electricity reform is entering a new phase through the Turkish Government�s proposal to create 21 new distribution companies, 18 of them by merger. Two aspects of merger analysis are the operational cost savings and the potential production efficiency gains. This paper concentrates on the second aspect and uses a recently developed methodology to assess the potential effect of these mergers and whether these mergers are efficiency enhancing. This is performed by comparing the actual efficiency levels of observed distribution companies with the merger of proposed aggregated companies. The model is calibrated on panel data from 1999 to 2003 which include measures of physical capital and labor inputs, as well as customer and energy related outputs. The results indicate potential for considerable efficiency gains from the proposed mergers.



Energy Price Reform and Household Welfare: The Case of Turkey

Fan Zhang

Year: 2015
Volume: Volume 36
Number: Number 2
DOI: 10.5547/01956574.36.2.4
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Abstract:
A price reform in Turkey increased the residential electricity tariff by more than 50 percent in 2008. The reform, aimed at encouraging energy efficiency and private investment, sparked considerable policy debate about its potential impact on household welfare. This paper estimates a short-run residential electricity demand function to evaluate the distributional impact of the tariff increase. The analysis allows heterogeneity in households' price sensitivity and the model is estimated using a nationally representative sample of 8,572 Turkish households. The results suggest that rich households in Turkey are three times as responsive in adjusting consumption to price changes as poor households are. In addition, the welfare loss of the poorest income quintile - measured by the change in consumer surplus as a percentage of income - is 2.9 times that of the wealthiest.





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