IDEAS home Printed from https://ideas.repec.org/p/euf/ecopap/0534.html
   My bibliography  Save this paper

Electricity Tariff Deficit: Temporary or Permanent problem in the EU?

Author

Listed:
  • Asa Johannesson Linden
  • Fotios Kalantzis
  • Emmanuelle Maincent
  • Jerzy Pienkowski

Abstract

In the recent years electricity tariff deficits emerged in Spain, Portugal, Greece and in some other Member States. Tariff deficits are shortfalls of revenues in the electricity system, which arise when the tariffs for the regulated components of the retail electricity price are set below the corresponding costs borne by the energy companies. The objective of this paper is to define and identify the different cases of electricity tariff deficits in Member States. The analysis starts with a description of the functioning of the electricity market in Europe, including price formation and different forms of government intervention, such as support to renewable energy and retail price regulation. Then the paper determines the existence of tariff deficits in the various Member States on the basis of common criteria and describes their common features, as well as particular characteristics of tariff deficits in the countries concerned. An econometric analysis is carried out to identify the drivers of the emergence of a tariff deficit. The final section discusses the impact on the individual firms and on public finances and provides the conclusions.

Suggested Citation

  • Asa Johannesson Linden & Fotios Kalantzis & Emmanuelle Maincent & Jerzy Pienkowski, 2014. "Electricity Tariff Deficit: Temporary or Permanent problem in the EU?," European Economy - Economic Papers 2008 - 2015 534, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    • Handle: RePEc:euf:ecopap:0534
    as

    Download full text from publisher

    File URL: https://ec.europa.eu/economy_finance/publications/economic_paper/2014/ecp534_en.htm
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Colmenar-Santos, A. & de Palacio-Rodriguez, Carlos & Rosales-Asensio, Enrique & Borge-Diez, David, 2017. "Estimating the benefits of vehicle-to-home in islands: The case of the Canary Islands," Energy, Elsevier, vol. 134(C), pages 311-322.
    2. Maria Elisabete Neves & Carla Henriques & João Vilas, 2021. "Financial performance assessment of electricity companies: evidence from Portugal," Operational Research, Springer, vol. 21(4), pages 2809-2857, December.
    3. Prata, Ricardo & Carvalho, Pedro M.S. & Azevedo, Inês L., 2018. "Distributional costs of wind energy production in Portugal under the liberalized Iberian market regime," Energy Policy, Elsevier, vol. 113(C), pages 500-512.
    4. Beöthy, Ákos & Kácsor, Enikő & Bartek-Lesi, Mária & Kerekes, Lajos & Kotek, Péter, 2019. "Energiaköltségek hatása a feldolgozóipar költség-versenyképességére [Energy costs and cost competitiveness in the manufacturing sector]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(3), pages 256-285.
    5. Gürtler, Konrad & Postpischil, Rafael & Quitzow, Rainer, 2019. "The dismantling of renewable energy policies: The cases of Spain and the Czech Republic," Energy Policy, Elsevier, vol. 133(C).
    6. Guittet, Mélanie & Capezzali, Massimiliano & Gaudard, Ludovic & Romerio, Franco & Vuille, François & Avellan, François, 2016. "Study of the drivers and asset management of pumped-storage power plants historical and geographical perspective," Energy, Elsevier, vol. 111(C), pages 560-579.
    7. Aklin, Michaël, 2021. "Do high electricity bills undermine public support for renewables? Evidence from the European Union," Energy Policy, Elsevier, vol. 156(C).
    8. Chiappinelli, Olga & May, Nils, 2022. "Too good to be true? Time-inconsistent renewable energy policies," Energy Economics, Elsevier, vol. 112(C).
    9. repec:diw:diwwpp:dp1726 is not listed on IDEAS
    10. Gómez, Antonio & Dopazo, César & Fueyo, Norberto, 2016. "The “cost of not doing” energy planning: The Spanish energy bubble," Energy, Elsevier, vol. 101(C), pages 434-446.

    More about this item

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:euf:ecopap:0534. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ECFIN INFO (email available below). General contact details of provider: https://edirc.repec.org/data/dg2ecbe.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.