Understanding Social Impacts & Improving the Acceptability of Electricity Privatization in Turkey
Turkey has had remarkable success in its electricity distribution privatization, adopted as the best available means to achieve energy and fiscal sustainability. While helping to ensure access and improve service delivery, privatization was also expected to affect the affordability of energy services for the poor, and decrease non-payment. This report analyzes findings from a quantitative and qualitative assessment in order to 1) understand household experiences of the electricity reforms’ impacts on different stakeholders, and 2) help inform mitigation measures in order to make reforms more acceptable to all stakeholders. The report finds that impacts of the significant electricity price increases that accompanied privatization have been mitigated by Turkey’s economic growth and the accompanying growth in incomes. Majority of electricity consumers can afford their electricity bills. However not all consumers can comfortably afford the impact of higher prices, such as households in the lowest quintile (especially rural households, those with non-salaried incomes, and those who previously did not pay for electricity) and those consumers whose livelihoods may necessitate electricity (such as farmers using electric water pumps for irrigation or small urban businesses).
Discussion » PSIA of the Month (July 2015)
PSIA of the Month (July 2015)
Understanding Social Impacts & Improving the Acceptability of Electricity Privatization in Turkey
Turkey has had remarkable success in its electricity distribution privatization, adopted as the best available means to achieve energy and fiscal sustainability. While helping to ensure access and improve service delivery, privatization was also expected to affect the affordability of energy services for the poor, and decrease non-payment. This report analyzes findings from a quantitative and qualitative assessment in order to 1) understand household experiences of the electricity reforms’ impacts on different stakeholders, and 2) help inform mitigation measures in order to make reforms more acceptable to all stakeholders. The report finds that impacts of the significant electricity price increases that accompanied privatization have been mitigated by Turkey’s economic growth and the accompanying growth in incomes. Majority of electricity consumers can afford their electricity bills. However not all consumers can comfortably afford the impact of higher prices, such as households in the lowest quintile (especially rural households, those with non-salaried incomes, and those who previously did not pay for electricity) and those consumers whose livelihoods may necessitate electricity (such as farmers using electric water pumps for irrigation or small urban businesses).
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