ABSTRACT
The UK electricity supply industry was substantially transferred from the public to the private sector in March 1991. Prior to 1990, a single, integrated public utility, the CEGB (Central Electricity Generating Board) had operated the whole generation and transmission business, together with 12 regional distribution companies. These 12 distribution companies were also sold to the private sector in 1990. Figure 1 summarizes the key points in the new industry structure. The two new generating companies National Power and PowerGen inherited 50% and 30% of the capacity respectively, with the remaining 20% (the nuclear plants) staying in the public sector. A National Grid Company has taken over the transmission business and is responsible for operating the daily ‘power-pool’, which is the market-place for the distribution and generating companies to compete in buying and selling electricity. All of this has been motivated by the UK Government’s belief in ‘popular capitalism’ and its faith in a deregulated generation business attracting independent producers and thereby promoting greater industrial efficiency.
