The effect of privatization of electricity market policies in Turkey on the relotionship beetween electricity consumption and economical growth

The acceptance of energy as an undeniable input on the growth of national economies is important in terms of the direction in which and how much the relationship between energy and growth affect each other. This urged policymakers in countries to take some decisions, such as privatization of energy. The purpose of this study is to make a comparison of the relationship between the electricity consumption that took place in Turkey pre and post privatization in the field of energy and economic growth, as well as to put forward through econometric analyzes which one plays a more effective role in growth. In line with this purpose, three periodic models were created with reference to the privatization process of electrical energy sector in Turkey. In the first model, the relationship between electricity consumption and economic growth in Turkey between the years of 1975-2016 were analyzed using "time series" econometric methods. In the second model, the period between 1975 and 2004 was examined, through which electrical energy was implemented as a project and taken into the scope of privatization. In the last model, the effects of the period from 2004 – the year when "Electricity Energy Sector Reform and Privatization Strategy Document" was published, which is considered as the milestone of the process of privatization of electrical energy – to 2016 on economic growth were analyzed by using time series econometric methods and comparison of these periods was made. In light of the findings obtained, it was found that electricity consumption was effective on long-term growth in the periods between 1975-2016 and 1975-2004, while it was concluded that the privatization program realized after 2004Q1-2016Q4 has created a change from growth to electricity consumption. Although the privatization of the electricity sector cannot be easily distinguished by a clear date, the results of this study can serve a pilot role for giving preliminary knowledge and direction to policy makers as to whether government reforms and plans will be in place in terms of understanding if the privatization reforms after 2004, which is taken as the starting point of privatization, had an impact on economic growth.