Electricity deregulation in OECD (Organization for Economic Cooperation and Development) countries

A ALSUNAIDY, R GREEN
2006 Energy  
This paper discusses the spread of electricity deregulation in OECD countries since the early 1990s. England, Wales and Norway were the pioneers, but almost all OECD countries have now introduced some degree of liberalisation, and several have free entry to generation while allowing all electricity consumers to choose where they buy their power. The paper discusses some of the issues raised by competition in generation and in retailing (or supply), and the need to have appropriate regulation
more » ... the transmission and distribution systems, which will continue to be monopolies."  Apt, J. (2005). Competition has not lowered U.S. industrial electricity prices. Abstract: "Previous studies have shown that significant price reductions resulted from deregulation in airlines, trucking, railroads, and natural gas. Retail electricity price data from 1990 through 2003 show no such benefit to industrial customers." Abstract: "Blind faith is unlikely to produce a free market that is competitive. Substituting markets for traditional regulation is only one choice among many policy instruments to achieve a goal of lower prices; such substitution should not be in itself a goal."  Brennan, T. Abstract: "Distributing electricity to users has been covered through the charge per kilowatt-hour for electricity used. Conservation advocates have promoted policies that "decouple" distribution revenues or profits from the amount of electricity delivered, claiming that usage-based pricing leads utilities to encourage use and discourage conservation. Because decoupling separates profits from conduct, it runs against the dominant finding in regulatory economics in the last 20 years-that incentive-based regulation outperforms rate-of-return profit guarantees. Even if distribution costs are independent of use, some usage charges can be efficient. Price-cap regulation may distort incentives to inform consumers about
doi:10.1016/j.energy.2005.02.017 fatcat:l33fqe7x3bf2paerht43xvuxwy