GENERIC MODELS FOR ELECTRICITY INDUSTRY STRUCTURE 31 August 2004 Energy Futures Australia Pty Ltd 11 Binya Close Hornsby Heights NSW 2077 Australia Phone: + 61 2 9477 7885 Mobile: + 61 411 467 982 Fax: + 61 2 9477 7503 Email: efa@efa.com.au Website: http://www.efa.com.au Generic Models for Electricity Industry Structure INTRODUCTION The range of possible structures for an electricity industry comprises a continuum from vertically integrated monopoly utilities on the one hand to unbundled electricity businesses with full competition on the other. It is not meaningful to assess all possible combinations of electricity industry structures. However, a multi-national research project, Task VI of the International Energy Agency’s Demand-Side Management Programme, developed four generic models for the structure of electricity industries1, 2. The four models are: Model 1 - Vertically integrated monopoly Model 2 - Unbundled monopoly Model 3 - Unbundled, limited competition Model 4 - Unbundled, full competition Descriptions and diagrams of these models are presented on pages 2-5. The generic models are based on only two structural dimensions of an electricity industry: the degree of unbundling and the extent of competition. Consequently, they represent four points on a continuum (see the matrix diagram on page 6). The models do not attempt to describe other aspects of an electricity industry, such as the type of ownership of electricity businesses, form of industry regulation, a ...
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