Effects of privatization: A case study from Cayirhan coal district, Turkey

Privatization of lignite coal-fired power plants in Turkey began in the middle of 1990 and is still an ongoing process. Among the 10 power plants offered to bidders in 1996, only Cayirhan power plant bundled with the coal mine was privatized. Considerable improvements have been obtained following the privatization of both the power plant and the coal mine. In view of its success, it is considered that Cayirhan experience could serve as a model for further privatization in energy sector, planned to be completed by the end of 2006 according to the agenda issued by government. This paper deals with the overall improvements following the privatization of both the power plant and the coal mine. In particular, mechanized roadway drivage performances before and after privatization are compared in order to highlight the specific effects of privatization in this area. It is found that competition, organizational and operational changes are the main causes of improvements attained in the post-privatization period.