The Difficult Transition to Competitive Electricity Markets in the U.S

Paul Joskow

Cambridge Working Papers in Economics from Faculty of Economics, University of Cambridge

Abstract: This paper discusses the causes and consequences of state and federal initiatives to introduce wholesale and retail competition into the U.S. electricity sector from 1995. The development and performance of wholesale market institutions, the expansion of wholesale power trade, the entry of merchant generating capacity, and the financial collapse of the trading and merchant generating sector is discussed. Issues regarding the ability of evolving spot wholesale energy market institutions and market power mitigation mechanisms in the absence of some form of peak capacity obligation are discussed theoretically and evaluated empirically. The diffusion of retail competition and the performance of retail competition programs in eight states is examined empirically. The analysis leads to the overall conclusion that the development of efficient competitive wholesale and retail electricity markets continues to be a work in progress and faces many technical, institutional and political challenges in the U.S.

Pages: 106
Date: 2003-05
New Economics Papers: this item is included in nep-ind
Note: CMI28, IO
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (37)

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Related works:
Working Paper: The Difficult Transition to Competitive Electricity Markets in the US (2003)
Working Paper: The Difficult Transition to Competitive Electricity Markets in the U.S (2003)
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