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Pass-through in Colombia s Unregulated Retail Electricity Market

Author

Listed:
  • Alex Perez

    (Professional, Centro de Estudios en Econom a Industrial e Internacional, Banco de la Rep blica de Colombia, Colombia,)

  • Jaime Carabali

    (Data Analyst, Banco W, Cali, Colombia)

  • Luis Meneses

    (Universidad Cooperativa de Colombia and Universidad ICESI, Colombia.)

Abstract

This study analyzes the pass-through of wholesale costs to retail prices for unregulated users in the Colombian electricity market, using monthly data from 2012 to 2019. This period encompasses moments with and without an El Ni o phenomenon. We use an empirical model to analyze the pass-through heterogeneity according to the characteristics of users and firms, showing that the pass-through is incomplete, differs according to the presence of El Ni o, and is heterogeneous. The pass-through was greater from September 2015 to May 2016 because an El Ni o caused hydrological resource scarcity and several critical thermal plants halted operations. In other words, the pass-through tends to be more comprehensive during an El Ni o event. Additionally, the pass-through differs between firms with a high concentration of the market and the remaining firms and between urban and non-urban users.

Suggested Citation

  • Alex Perez & Jaime Carabali & Luis Meneses, 2022. "Pass-through in Colombia s Unregulated Retail Electricity Market," International Journal of Energy Economics and Policy, Econjournals, vol. 12(4), pages 575-583, July.
    • Handle: RePEc:eco:journ2:2022-04-61
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    References listed on IDEAS

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    More about this item

    Keywords

    Pass-through; Electricity markets; Wholesale costs; Retail prices;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • Q49 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Other
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities

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