This paper discusses the California electricity market debacle and asks which lessons could be drawn from the Californian experience. It analyzes the market developments and depicts the reasons for the market meltdown. It is shown that the present situation in California may be only the calm...

In diesem Papier werden die Grundzüge der Strommarktregulierung in den Vereinigten Staaten und in Kalifornien dargestellt. Dabei wird zunächst auf die zentralen Vorgaben des Bundesgesetzgebers (PUHCA, FPA, PURPA, EPAct) und auf die Regulierungspolitik der Bundesregulierungsbehörde für...

Theoretically, if firms face a regulatory per-customer quantity limit, they should have an incentive to discriminatively charge high-demand customers higher prices and make them just willing to buy a quantity equal to the limit. In the U.S. residential mortgage industry, mortgages with...

This paper investigates a puzzle and possible policy concern: Why do platforms such as eBay and Visa that enable the trade of goods of different unobserved costs and valuations rely predominantly on linear ad-valorem fees, that is, fees that increase in proportion to the sale price of the trades...

This paper explains why platforms such as Amazon and Visa rely predominantly on ad-valorem fees, fees which increase proportionally with transaction prices. It also provides a new explanation for why ad-valorem sales taxes are more desirable than specific taxes. The theory rests on the ability...

I study the role of purely financial players in electricity markets, where they trade alongside physical buyers and sellers. In this context, physical sellers intertemporally price discriminate, leading to price differences that financial traders arbitrage, thus restricting producers' market...

This paper investigates price volatility and spillover effects in the Nordic electricity wholesale markets, comprising Sweden, Finland, Denmark, and Norway. Utilizing both the Time-Varying Parameter Vector Autoregressive (TVP-VAR) and Rolling Window-based VAR (RW-VAR) approaches, we analyze the...

Many policy-makers are currently weighing the advantages of deregulating electricity markets over more traditional regulatory methods. However, within this traditional regulatory environment many options exist. In particular, the use of incentive regulation programs in US electricity markets has...

In April 2003 the U.S. Federal Energy Regulatory Commission proposed a complicated market design – the Wholesale Power Market Platform (WPMP) – for common adoption by all U.S. wholesale power markets. Versions of the WPMP have been implemented in New England, New York, the mid-Atlantic...

In this paper, we present a straightforward economic model that explains the incentives to manipulate nodal energy prices in a “Day 2” RTO market. The model distinguishes between legitimate market participation that increases overall market efficiency and manipulative behavior that distorts...