Publication: Revisiting Reform in the Energy Sector : Lessons from Georgia
Date
2004
ISSN
Published
2004
Author(s)
Abstract
This paper reviews the changes in the
supply of electricity and gas from the perpective of
households, utility operators, and the government. The
objective is to highlight lessons from the reforms
implemented and to apply them to the future reform program
planned for the rest of the energy sector. The paper
concludes that improved service quality and the increased
supply of clean and subsidized natural gas have offset the
potentially negative impact of higher electricity prices.
Despite very good performance by the privatized electricity
distribution company in Tbilisi, the sustainability of the
reform program is still in doubt. Consolidated government
expenditures on energy have increased, but to a large extent
this simply recognizes costs that were incurred, but not
paid, prior to reform. Existing subsidies to households for
electricity provide compensation beyond levels that produce
large welfare gains. Changing the subsidy system to base
targeting on actual levels of electricity consumption while
providing enough compensation to ensure the household
received a basic level of electricity, would be one option
to improve subsidy targeting.
Citation
“Lampietti, Julian A.; Gonzalez, Hernan; Wilson, Margaret; Hamilton, Ellen; Vashakmadze, Sergo. 2004. Revisiting Reform in the Energy Sector : Lessons from Georgia. World Bank Working Paper;No. 21. © Washington, DC: World Bank. http://openknowledge.worldbank.org/entities/publication/2e078b67-04de-52ce-9d18-dca1d272bafc License: CC BY 3.0 IGO.”
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