Financial impact of energy efficiency and energy policies aimed at power sector reforms: mediating role of financing in the power sector

This research examines how financial transformative power sector reforms affect energy efficiency and the economy in a sample of economies from South Asia, the Middle East, and Europe. We applied two stages of OLS, Bayesian VAR, and Data Envelopment Analysis (DEA) methods to a panel data set from 1995 to 2018. According to empirical findings, institutional deficiency has a negative effect on electricity reforms, implying that the greater the impact of reforms on electricity performance, the higher the institutional efficiency, A collection of reform initiatives involving a variety of reform agencies will boost energy efficiency by up to 13% and per capita electricity access by 62%. Despite recent reforms and regulatory measures, the electricity sector continues to face challenges in terms of private investment and structural flaws such as energy inefficiency, significant technological and financial losses, low power quality, and outdated transmission and network infrastructure. Interestingly 13.2% increases can be found in energy efficiency after electricity reforms. Unlike previous studies, our findings reveal a conflict between the broader economic effects and the welfare impact on electricity consumers.