Misreading liberalisation and privatisation: The case of the US energy utilities in Europe

In response to energy market liberalisation and privatisation initiatives promoted by the EU and other European states in the 1990s, a large number of US energy utilities expanded their activities in Europe, mainly through acquisitions. The size of their investment was, a decade later, matched by th...

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Bibliographic Details
Published in:Energy policy 2008-07, Vol.36 (7), p.2610-2619
Main Authors: Haar, Laura N., Jones, Trefor
Format: Article
Language:English
Subjects:
Acquisitions
Acquisitions & mergers
Applied sciences
Business investment
Economic data
Electric energy
Electric utilities
Energy
Energy economics
Energy industry
Energy market
Energy markets
Energy policy
Europe
European Union
Exact sciences and technology
Foreign enterprises
Foreign investments
General, economic and professional studies
Initiatives
International acquisitions
Investment analysis
Liberalization
Markets
Multinational enterprises
Privatization
Public utilities
Studies
U.S.A
United States
Utilities
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Summary:In response to energy market liberalisation and privatisation initiatives promoted by the EU and other European states in the 1990s, a large number of US energy utilities expanded their activities in Europe, mainly through acquisitions. The size of their investment was, a decade later, matched by the ensuing scale of their retreat, wealth destruction and often forced exit. Combining interviews, industry studies, published financial data and company reports, this article examines critically their strategy and, in light of widespread failures, seeks to answer the question of what went wrong. It is argued that mistakes might have been avoided through greater appreciation of how market liberalisation evolves given changing government priorities and general sovereign risk.
ISSN:0301-4215
1873-6777
DOI:10.1016/j.enpol.2008.03.016