Loyalty or competition comparative analysis of Norwegian and Swedish electricity distributors' adaptation to market reform

Recent electricity reforms in Norway and Sweden, aimed at introducing competition in production and trade, have challenged traditional producer-distributor networks. This paper examines the responses of municipal distributors in three types of networks at the outset of the respective reforms, namely vertically integrated networks, networks integrated by ownership ties, and contractually integrated networks, While some distributors in the two countries have chosen competitive, exit-oriented strategies, others have remained loyal to their pre-existing suppliers, Analysis of these emergent patterns reveals that the new market regimes have not automatically implied a shift to a competitive regime but rather to a remolding of traditional networks to suit the new market order, Besides short-term commercial considerations, municipal distributor strategies seem to reflect societal and long-term strategic levels of exchange. (C) 1998 Elsevier Science Ltd.