Transition to centralized unit commitment : an econometric analysis of Colombia’s experience

Castro, Luciano de; Oren, Shmuel; Riascos, Alvaro J.; Bernal, Miguel

Transition to centralized unit commitment : an econometric analysis of Colombia’s experience

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Borradores de Economía; No. 830

Date published

2014-07-16

Date

2014-07-16

Authors

Castro, Luciano de
Oren, Shmuel
Riascos, Alvaro J.
Bernal, Miguel

Document language

spa

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Las opiniones contenidas en el presente documento son responsabilidad exclusiva de los autores y no comprometen al Banco de la República ni a su Junta Directiva.

The opinions contained in this document are the sole responsibility of the author and do not commit Banco de la República or its Board of Directors.

Abstract

This paper evaluates the impact of Resolution CREG 051 on the performance of the electricity markets in Colombia. We found out that productive efficiency has improved since the introduction of the Resolution, that is, the total costs of producing electricity have been reduced. This shows a positive impact of the Resolution. On the other hand, we also found that mark-ups and forward energy prices (from bilateral contracts) have increased since 2009, suggesting that there was an increase in the exercise of market power by producers. From the two previous points, we conclude that, although the productive efficiency has increased, the larger share of the efficiency gains were appropriated by the energy producers, rather than passed on to consumers.