The performance of the US market for independent electricity generation
- Lawrence Berkeley Lab., CA (United States)
The electric power industry has undergone a variety of experiments with greater reliance on market forces. A common theme is the liberalization of entry restrictions and the elimination or reduction of profit regulation. In the United States and the United Kingdom, the reliance on market forces has manifested itself via liberalized entry, competive bidding for long-term bulk power supplies, and a reduction in the use of rate-of-return regulation at the wholesale level. A sample of power purchase contracts for 26 independent power facilities is used as the basis of this assessment. Contracts were executed between 1987-94. The authors describe qualitative features of the contracts and standardize the price formulas. Because of residual price variation and an indication that buyer willingness-to-pay is highly correlated with price, the authors conclude that bulk power sold by independent power producers is a heterogeneous product, and evidence for competition in market prices is weak. 24 refs., 6 tabs.
- OSTI ID:
- 401745
- Journal Information:
- Energy Journal, Vol. 17, Issue 3; Other Information: PBD: 1996
- Country of Publication:
- United States
- Language:
- English
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