Charges, Costs and Market Power: the Deregulated UK Electricity Retail Market

Evens Salies and Catherine WADDAMS Price
Additional contact information
Catherine WADDAMS Price: University of East Anglia

Industrial Organization from University Library of Munich, Germany

Abstract: The residential UK electricity market was opened for the first time in 1999, introducing choice of supplier, and about 40% of households changed supplier in the first four years. After three years price caps were removed. We review this process and assess the competitiveness of the market by examining how the charges levied by suppliers depend on cost and demand factors for three different payment methods and consumption levels. We also identify signs of additional market power of incumbency and the effect of levying a tariff with no fixed charge. We find that both cost and demand factors affect charges, and the relationship varies for different payment methods and consumption levels; and that tariffs with no fixed element have different effects for different payment methods. We also conclude that considerable market power seems to remain with potentially adverse distributional effects.

Keywords: Energy retail; Pricing; Seemingly Unrelated Regression Equations (search for similar items in EconPapers)
JEL-codes: D43 L13 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2005-08-10
Note: Type of Document - pdf; pages: 23
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://econwpa.ub.uni-muenchen.de/econ-wp/io/papers/0508/0508010.pdf (application/pdf)

Related works:
Journal Article: Charges, Costs and Market Power: the Deregulated UK Electricity Retail Market (2004)
Journal Article: Charges, Costs and Market Power: the Deregulated UK Electricity Retail Market (2004)
Working Paper: Charges, Costs and Market Power: the Deregulated UK Electricity Retail Market (2004)
Working Paper: Charges, Costs and Market Power: the Deregulated UK Electricity Retail Market (2004)
Working Paper: Charges, costs and market power in the deregulated UK electricity retail market (2004)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpio:0508010

Access Statistics for this paper

More papers in Industrial Organization from University Library of Munich, Germany
Bibliographic data for series maintained by EconWPA ( this e-mail address is bad, please contact ).