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Lower prices for polluting goods will increase their sales and the pollution that results from their production or use. Conventional intuition suggests that this relationship implies a greater need for environmental policy when prices of "dirty" goods fall. But the economic inefficiency...
Persistent link: https://www.econbiz.de/10009445448
Demand-side management programs comprise subsidies from franchised electric utilities for the purchase of high-efficiency appliances; e.g., air conditioners. Competition in power generation threatens the viability of these programs. However, it should also reduce the warrant for them. Under...
Persistent link: https://www.econbiz.de/10009445485
Residential consumers remain reluctant to choose new electricity suppliers. Even the most successful jurisdictions, four U.S. states and other countries, have had to adopt extensive consumer education procedures that serve largely to confirm that choosing electricity suppliers is daunting....
Persistent link: https://www.econbiz.de/10009445495
Reserve requirements in electricity markets may get each producer to internalize the cost of grid-wide blackouts it might cause if unable to meet consumer demand. Markets for how such capacity might be procured have been studied. Less examined is how the costs of reserve capacity are covered....
Persistent link: https://www.econbiz.de/10009445496
Allegations of market power in wholesale electricity sales are typically tested using price-cost margins. Such tests are inherently suspect in markets-such as electricity-that are subject to capacity constraints. In such markets, prices can vary with demand while quantity, and thus cost measure,...
Persistent link: https://www.econbiz.de/10009446673
Restructuring the electricity market may secure efficiencies by moving away from cost-of-service regulation, with typically (but not necessarily) time-invariant prices, and allowing prices to reflect how costs change. Charging "real time" prices requires that electricity use be measured...
Persistent link: https://www.econbiz.de/10009446679
This paper explores ways in which economic analysis can help resolve the stranded cost controversy that has arisen in debates over electricity market deregulation. "Stranded costs" are costs electric utilities will not recover as power markets move from protected monopolies to an open,...
Persistent link: https://www.econbiz.de/10009446680