Formation of competitive supply in heat energy sector: Lithuanian case

Abstract

The authors of the article have investigated the constituents of competitive supply and have presented the algorithm of its formation in the sector of thermal power. The investigations conducted by them indicate that in a given market the supply of goods and services must be presented in proportion to their demand. In this way the business losses and costs from the unrealized demand are reducing and its general competitiveness is growing. The investigations conducted by the authors indicate that the bigger number of the market participants, the bigger influence is made to the business competitiveness by its ability to structurize the supply appropriately. To achieve competitive supply a stable business structure is necessary which enables to form business structures having a stable financial basis. As in the investigated market the action takes place with one product-thermal power-one can efficiently concentrate on the processes of formation of competitive supply. The information collected during the statistical investigation has indicated that the dynamics of untilled areas of agricultural destination can significantly affect the price of heat. By reclaiming these areas and starting to grow energetic plants one can achieve the reduction of the price of heat. Conditions to reorientate the energy system towards the production of the green energy are created. In this way an opportunity to form a competitive supply in respect of the business entities using fossil fuels appears.