Skip to main content

2022 | OriginalPaper | Buchkapitel

An Econometric Assessment of the Effects of Electricity Market Reform on Bangladesh Economy

verfasst von : Sakib Amin, Rabindra Nepal, Han Phoumin

Erschienen in: Revisiting Electricity Market Reforms

Verlag: Springer Nature Singapore

Aktivieren Sie unsere intelligente Suche um passende Fachinhalte oder Patente zu finden.

search-config
loading …

Abstract

The supply of reliable and affordable electricity has become imperative in most production and household activities in modern society. No country has progressed after subsistence extent without guaranteeing the least electricity level. Many developing and emerging countries have started implementing reform initiatives around the electricity market since the 1990s. The major developments in reforming countries are structural changes and privatisation of electricity and energy utilities. Bangladesh is also no exception to this trend. Realising the significance of the electricity sector as the lifeblood of industrial and economic development, the country also took multiple strides towards developing the sector by restructuring key power companies, creating independent regulatory bodies, and promoting private sector firms to enter the electricity market. However, to our knowledge, no literature focuses on the impact of the electricity market reform (EMR) in Bangladesh through the lens of privatisation, competition, and regulation. Addressing the research gap and discussing the reform initiatives critically, this chapter aims to empirically analyse the effects of the EMR on the energy sector development and macroeconomic stability of Bangladesh with the help of a time-series data set covering 1980–2019. We use standard and robust unit root and cointegration tests for empirical analysis. For the long-run estimation purpose, we use the dynamic OLS method. The results of our study can help policymakers adopt effective policies for sustainable development in Bangladesh.

Sie haben noch keine Lizenz? Dann Informieren Sie sich jetzt über unsere Produkte:

Springer Professional "Wirtschaft+Technik"

Online-Abonnement

Mit Springer Professional "Wirtschaft+Technik" erhalten Sie Zugriff auf:

  • über 102.000 Bücher
  • über 537 Zeitschriften

aus folgenden Fachgebieten:

  • Automobil + Motoren
  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Elektrotechnik + Elektronik
  • Energie + Nachhaltigkeit
  • Finance + Banking
  • Management + Führung
  • Marketing + Vertrieb
  • Maschinenbau + Werkstoffe
  • Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

Springer Professional "Technik"

Online-Abonnement

Mit Springer Professional "Technik" erhalten Sie Zugriff auf:

  • über 67.000 Bücher
  • über 390 Zeitschriften

aus folgenden Fachgebieten:

  • Automobil + Motoren
  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Elektrotechnik + Elektronik
  • Energie + Nachhaltigkeit
  • Maschinenbau + Werkstoffe




 

Jetzt Wissensvorsprung sichern!

Springer Professional "Wirtschaft"

Online-Abonnement

Mit Springer Professional "Wirtschaft" erhalten Sie Zugriff auf:

  • über 67.000 Bücher
  • über 340 Zeitschriften

aus folgenden Fachgebieten:

  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Finance + Banking
  • Management + Führung
  • Marketing + Vertrieb
  • Versicherung + Risiko




Jetzt Wissensvorsprung sichern!

Fußnoten
1
‘Power’ and ‘electricity’ are used interchangeably in this chapter.
 
3
Only 3% of the population had access to electricity in 1971.
 
6
Bangladesh becomes the first South Asian country to introduce benchmark pricing system.
 
7
Amin et al. (2021c) report that private investment is better than government investment in increasing energy consumption in South Asia. = .
 
8
For more details about investment potentials in the Bangladesh power sector (as of 13th June 2019), see http://​www.​powercell.​gov.​bd/​site/​page/​8bf3f2bf-cdc8-4235-b2ca-1e8e39e3e7df/​-.
 
10
Article 16 states: ‘The State shall adopt effective measures to bring about a radical transformation in the rural areas through the promotion of an agricultural revolution, the provision of rural electrification, the development of cottage and other industries, and the improvement of education, communications and public health, in those areas, so as progressively to remove the disparity in the standards of living between the urban and the rural areas’. See http://​bdlaws.​minlaw.​gov.​bd/​act-367/​part-199.​html.
 
18
This power sector road map was further revised in 2011.
 
24
This can be simply referred to as unregistered consumption of electricity.
 
Literatur
Zurück zum Zitat Akkemik KA, Oğuz F (2011) Regulation, efficiency, and equilibrium: a general equilibrium analysis of liberalization in the Turkish electricity market. Energy 36(5):3282–3292 CrossRef Akkemik KA, Oğuz F (2011) Regulation, efficiency, and equilibrium: a general equilibrium analysis of liberalization in the Turkish electricity market. Energy 36(5):3282–3292 CrossRef
Zurück zum Zitat Amin SB, Al Kabir F, Khan F (2020) Energy-output Nexus in Bangladesh: A two-sector model analysis. Energ Strat Rev 32:100566 CrossRef Amin SB, Al Kabir F, Khan F (2020) Energy-output Nexus in Bangladesh: A two-sector model analysis. Energ Strat Rev 32:100566 CrossRef
Zurück zum Zitat Amin S, Jamasb T, Llorca M, Marsiliani L, Renström TI, Sarkar A (2021a) Captive power, market access and macroeconomic performance: reforming the bangladesh electricity sector. Energy Econ 102:105468 CrossRef Amin S, Jamasb T, Llorca M, Marsiliani L, Renström TI, Sarkar A (2021a) Captive power, market access and macroeconomic performance: reforming the bangladesh electricity sector. Energy Econ 102:105468 CrossRef
Zurück zum Zitat Amin S, Jamasb T, Llorca M, Marsiliani L, Renström TI (2021b) Combining private and public resources: captive power plants and electricity sector development in Bangladesh. Emerg Mark Financ Trade 57(14):3891–3912 CrossRef Amin S, Jamasb T, Llorca M, Marsiliani L, Renström TI (2021b) Combining private and public resources: captive power plants and electricity sector development in Bangladesh. Emerg Mark Financ Trade 57(14):3891–3912 CrossRef
Zurück zum Zitat Amin S, Jamasb T, Nepal R (2021c) Regulatory reform and the relative efficacy of government versus private investment on energy consumption in South Asia. Econ Anal Policy 69:421–433 CrossRef Amin S, Jamasb T, Nepal R (2021c) Regulatory reform and the relative efficacy of government versus private investment on energy consumption in South Asia. Econ Anal Policy 69:421–433 CrossRef
Zurück zum Zitat Amin SB, Khan F (2020) Modelling energy demand in Bangladesh: an empirical analysis. J Dev Areas 54(1) Amin SB, Khan F (2020) Modelling energy demand in Bangladesh: an empirical analysis. J Dev Areas 54(1)
Zurück zum Zitat Amin SB, Ahmed A, Khan AM, Khan F (2021d) Policy paper on the post Covid-19 sustainable energy options for power generation in Bangladesh. Int Energy J 21(1A) Amin SB, Ahmed A, Khan AM, Khan F (2021d) Policy paper on the post Covid-19 sustainable energy options for power generation in Bangladesh. Int Energy J 21(1A)
Zurück zum Zitat Amin SB (2015) The macroeconomics of energy price shocks and electricity market reforms: the case of Bangladesh. Durham University Amin SB (2015) The macroeconomics of energy price shocks and electricity market reforms: the case of Bangladesh. Durham University
Zurück zum Zitat Cai Y, Aoyama Y (2018) Fragmented authorities, institutional misalignments, and challenges to renewable energy transition: a case study of wind power curtailment in China. Energy Res Soc Sci 41:71–79 CrossRef Cai Y, Aoyama Y (2018) Fragmented authorities, institutional misalignments, and challenges to renewable energy transition: a case study of wind power curtailment in China. Energy Res Soc Sci 41:71–79 CrossRef
Zurück zum Zitat Du L, He Y, Wei C (2010) The relationship between oil price shocks and China’s macroeconomy: an empirical analysis. Energy Policy 38(8):4142–4151 CrossRef Du L, He Y, Wei C (2010) The relationship between oil price shocks and China’s macroeconomy: an empirical analysis. Energy Policy 38(8):4142–4151 CrossRef
Zurück zum Zitat Erdogdu E (2011) The impact of power market reforms on electricity price-cost margin and cross-subsidy levels: a cross-country panel data analysis. Energy Policy 39(3):1080–1092 CrossRef Erdogdu E (2011) The impact of power market reforms on electricity price-cost margin and cross-subsidy levels: a cross-country panel data analysis. Energy Policy 39(3):1080–1092 CrossRef
Zurück zum Zitat Fenglong XIAO (2011) General equilibrium analysis of electricity market liberalization in Singapore: a comparative study. Theor Appl Econ 12(565):107–114 Fenglong XIAO (2011) General equilibrium analysis of electricity market liberalization in Singapore: a comparative study. Theor Appl Econ 12(565):107–114
Zurück zum Zitat GED (2020) Perspective plan of Bangladesh 2021–2041. Government of the People’s Republic of Bangladesh GED (2020) Perspective plan of Bangladesh 2021–2041. Government of the People’s Republic of Bangladesh
Zurück zum Zitat Ghafoor A, Rehman T, Munir A, Ahmad M, Iqbal M (2016) Current status and overview of renewable energy potential in Pakistan for continuous energy sustainability. Renew Sustain Energy Rev 60:1332–1342 CrossRef Ghafoor A, Rehman T, Munir A, Ahmad M, Iqbal M (2016) Current status and overview of renewable energy potential in Pakistan for continuous energy sustainability. Renew Sustain Energy Rev 60:1332–1342 CrossRef
Zurück zum Zitat Imam MI, Jamasb T, Llorca M (2019) Sector reforms and institutional corruption: evidence from electricity industry in Sub-Saharan Africa. Energy Policy 129:532–545 CrossRef Imam MI, Jamasb T, Llorca M (2019) Sector reforms and institutional corruption: evidence from electricity industry in Sub-Saharan Africa. Energy Policy 129:532–545 CrossRef
Zurück zum Zitat Jamasb T (2006) Between the state and market: electricity sector reform in developing countries. Util Policy 14(1):14–30 CrossRef Jamasb T (2006) Between the state and market: electricity sector reform in developing countries. Util Policy 14(1):14–30 CrossRef
Zurück zum Zitat Jamasb T, Nepal R (2011) Reforming small electricity systems under political instability: the case of Nepal. Energy Policy 40(1):242–251 Jamasb T, Nepal R (2011) Reforming small electricity systems under political instability: the case of Nepal. Energy Policy 40(1):242–251
Zurück zum Zitat Jamasb T, Nepal R, Timilsina G, Toman M (2014) Energy sector reform, economic efficiency and poverty reduction. World Bank, Washington, DC Jamasb T, Nepal R, Timilsina G, Toman M (2014) Energy sector reform, economic efficiency and poverty reduction. World Bank, Washington, DC
Zurück zum Zitat Jamasb T, Nepal R, Timilsina GR (2016) A quarter century effort yet to come of age: a survey of electricity sector reforms in developing countries. Energy J 38(3):195–234 Jamasb T, Nepal R, Timilsina GR (2016) A quarter century effort yet to come of age: a survey of electricity sector reforms in developing countries. Energy J 38(3):195–234
Zurück zum Zitat Jamasb T (2002) Reform and regulation of the electricity sectors in developing countries. CMI working paper 8 Jamasb T (2002) Reform and regulation of the electricity sectors in developing countries. CMI working paper 8
Zurück zum Zitat Kacprzyk A, Kuchta Z (2020) Shining a new light on the environmental Kuznets curve for CO2 emissions. Energy Econ 87:104704 CrossRef Kacprzyk A, Kuchta Z (2020) Shining a new light on the environmental Kuznets curve for CO2 emissions. Energy Econ 87:104704 CrossRef
Zurück zum Zitat Khandker SR, Barnes DF, Samad HA (2012) The welfare impacts of rural electrification in Bangladesh. Energy J 33(1) Khandker SR, Barnes DF, Samad HA (2012) The welfare impacts of rural electrification in Bangladesh. Energy J 33(1)
Zurück zum Zitat Kessides I (2012) The impacts of electricity sector reforms in developing countries. Electr J 25(6):79–88 CrossRef Kessides I (2012) The impacts of electricity sector reforms in developing countries. Electr J 25(6):79–88 CrossRef
Zurück zum Zitat Mujeri MK, Chowdhury TT, Shahana S (2013) Energy subsidies in Bangladesh: a profile of groups vulnerable to reform. Research Report. Bangladesh Institute of Development Studies, Dhaka Mujeri MK, Chowdhury TT, Shahana S (2013) Energy subsidies in Bangladesh: a profile of groups vulnerable to reform. Research Report. Bangladesh Institute of Development Studies, Dhaka
Zurück zum Zitat Murshid KAS (2020) Insights into the rural non-farm sector of Bangladesh. Whiteboard. Centre for Research and Information, Dhaka Murshid KAS (2020) Insights into the rural non-farm sector of Bangladesh. Whiteboard. Centre for Research and Information, Dhaka
Zurück zum Zitat Nakano M, Managi S (2008) Regulatory reforms and productivity: an empirical analysis of the Japanese electricity industry. Energy Policy 36(1):201–209 CrossRef Nakano M, Managi S (2008) Regulatory reforms and productivity: an empirical analysis of the Japanese electricity industry. Energy Policy 36(1):201–209 CrossRef
Zurück zum Zitat Nepal R, Jamasb T (2012) Reforming the power sector in transition: do institutions matter? Energy Econ 34(5):1675–1682 CrossRef Nepal R, Jamasb T (2012) Reforming the power sector in transition: do institutions matter? Energy Econ 34(5):1675–1682 CrossRef
Zurück zum Zitat Newbery D (2002) Issues and options in restructuring electricity supply industries. Cambridge working papers in economics 0210, Faculty of Economics, University of Cambridge Newbery D (2002) Issues and options in restructuring electricity supply industries. Cambridge working papers in economics 0210, Faculty of Economics, University of Cambridge
Zurück zum Zitat Pachauri S (2012) Demography, urbanisation, and energy demand. In: Toth FL (ed) Energy for development: resources, technologies, environment. Springer, Dordrecht Pachauri S (2012) Demography, urbanisation, and energy demand. In: Toth FL (ed) Energy for development: resources, technologies, environment. Springer, Dordrecht
Zurück zum Zitat Paltsev S (2020) Projecting energy and climate for the 21st century. Econ Energy Environ Policy 9(1):43–63 CrossRef Paltsev S (2020) Projecting energy and climate for the 21st century. Econ Energy Environ Policy 9(1):43–63 CrossRef
Zurück zum Zitat Parker D, Kirkpatrick C (2005) Privatisation in developing countries: a review of the evidence and the policy lessons. J Dev Stud 41(4):513–541 CrossRef Parker D, Kirkpatrick C (2005) Privatisation in developing countries: a review of the evidence and the policy lessons. J Dev Stud 41(4):513–541 CrossRef
Zurück zum Zitat Pollitt MG (1997) The impact of liberalisation on the performance of the electricity supply industry: an international survey. J Energy Lit 3(2):3–31 Pollitt MG (1997) The impact of liberalisation on the performance of the electricity supply industry: an international survey. J Energy Lit 3(2):3–31
Zurück zum Zitat Pollitt MG (2008) Electricity sector reform in Argentina: lessons for developing countries. Energy Econ 30:1536–1567 CrossRef Pollitt MG (2008) Electricity sector reform in Argentina: lessons for developing countries. Energy Econ 30:1536–1567 CrossRef
Zurück zum Zitat Rehman SAU, Cai Y, Mirjat NH, Walasai GD, Nafees M (2019) Energy-environment-economy Nexus in Pakistan: lessons from a PAK-TIMES model. Energy Policy 126:200–211 CrossRef Rehman SAU, Cai Y, Mirjat NH, Walasai GD, Nafees M (2019) Energy-environment-economy Nexus in Pakistan: lessons from a PAK-TIMES model. Energy Policy 126:200–211 CrossRef
Zurück zum Zitat Sen A (2014) Divergent paths to a common goal? An overview of challenges to electricity sector reform in developing versus developed countries. The Oxford Institute for Energy Studies, University of Oxford, OIES Paper CrossRef Sen A (2014) Divergent paths to a common goal? An overview of challenges to electricity sector reform in developing versus developed countries. The Oxford Institute for Energy Studies, University of Oxford, OIES Paper CrossRef
Zurück zum Zitat Sen A, Jamasb T (2012) Diversity in unity: an empirical analysis of electricity deregulation in Indian states. Energy J 33(1) Sen A, Jamasb T (2012) Diversity in unity: an empirical analysis of electricity deregulation in Indian states. Energy J 33(1)
Zurück zum Zitat Sen A, Nepal R, Jamasb T (2016) Reforming electricity reforms? Empirical evidence from Asian economies. OIES working paper EL 18. Oxford Institute of Energy Studies, Oxford University Sen A, Nepal R, Jamasb T (2016) Reforming electricity reforms? Empirical evidence from Asian economies. OIES working paper EL 18. Oxford Institute of Energy Studies, Oxford University
Zurück zum Zitat SREDA (2020) Recent statistics. Government of the People’s Republic of Bangladesh SREDA (2020) Recent statistics. Government of the People’s Republic of Bangladesh
Zurück zum Zitat Stern DI (2011) The role of energy in economic growth. Ann N Y Acad Sci 1219(1):26–51 CrossRef Stern DI (2011) The role of energy in economic growth. Ann N Y Acad Sci 1219(1):26–51 CrossRef
Zurück zum Zitat Stock JH, Watson MW (1993) A simple estimator of cointegrating vectors in higher order integrated systems. Econom J Econom Soc: 783–820 Stock JH, Watson MW (1993) A simple estimator of cointegrating vectors in higher order integrated systems. Econom J Econom Soc: 783–820
Zurück zum Zitat Tamim M, Badruddin NM, Chowdhury PM (2013) Bangladesh: energy sector primer. BRAC EPL research, BRAC EPL Stock Brokerage Limited Tamim M, Badruddin NM, Chowdhury PM (2013) Bangladesh: energy sector primer. BRAC EPL research, BRAC EPL Stock Brokerage Limited
Zurück zum Zitat Timilsina GR, Pang J, Yang X (2019) How much would China Gain from power sector reforms? An analysis using TIMES and CGE models. Policy research working paper No. 8908. World Bank, Washington, DC Timilsina GR, Pang J, Yang X (2019) How much would China Gain from power sector reforms? An analysis using TIMES and CGE models. Policy research working paper No. 8908. World Bank, Washington, DC
Zurück zum Zitat Vijay VK, Kapoor R, Trivedi A, Vijay V (2015) Biogas as clean fuel for cooking and transportation needs in India. In: Advances in bioprocess technology. Springer, Cham, pp 257–275 Vijay VK, Kapoor R, Trivedi A, Vijay V (2015) Biogas as clean fuel for cooking and transportation needs in India. In: Advances in bioprocess technology. Springer, Cham, pp 257–275
Zurück zum Zitat World Bank (2020) World development indicators. World Bank, Washington, DC World Bank (2020) World development indicators. World Bank, Washington, DC
Zurück zum Zitat Yin J, Yan Q, Lei K, Baležentis T, Streimikiene D (2019) Economic and efficiency analysis of China electricity market reform using computable general equilibrium model. Sustainability 11(2):350 CrossRef Yin J, Yan Q, Lei K, Baležentis T, Streimikiene D (2019) Economic and efficiency analysis of China electricity market reform using computable general equilibrium model. Sustainability 11(2):350 CrossRef
Zurück zum Zitat Zhang YF, Parker D, Kirkpatrick C (2008) Electricity Sector reform in developing countries: an econometric assessment of the effects of privatisation, competition, and regulation. J Regul Econ 33(2):159–178 CrossRef Zhang YF, Parker D, Kirkpatrick C (2008) Electricity Sector reform in developing countries: an econometric assessment of the effects of privatisation, competition, and regulation. J Regul Econ 33(2):159–178 CrossRef
Metadaten
Titel
An Econometric Assessment of the Effects of Electricity Market Reform on Bangladesh Economy
verfasst von
Sakib Amin
Rabindra Nepal
Han Phoumin
Copyright-Jahr
2022
Verlag
Springer Nature Singapore
DOI
https://doi.org/10.1007/978-981-19-4266-2_7