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Price freezes and gas pass-through: an estimation of the price impact of electricity market restructuring

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  • Alexander Hill

    (Arizona State University)

Abstract

This article examines the impact of market restructuring on retail prices, using the restructuring of the electricity industry as a case study. Utilizing synthetic control as an estimation strategy, this paper finds retail competition reduced retail prices across all sectors by an average of $1.5/MWh, relative to their counterfactual outcome. On average, prices fell for residential and commercial users and rose for industrial users. The price differential is consistent with the enactment of price ceilings and increased pass-through of changes in the price of natural gas.

Suggested Citation

  • Alexander Hill, 2023. "Price freezes and gas pass-through: an estimation of the price impact of electricity market restructuring," Journal of Regulatory Economics, Springer, vol. 63(1), pages 87-116, April.
    • Handle: RePEc:kap:regeco:v:63:y:2023:i:1:d:10.1007_s11149-023-09459-w
    DOI: 10.1007/s11149-023-09459-w
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    Cited by:

    1. Zarnikau, J. & Cao, K.H. & Qi, H.S. & Woo, C.K., 2023. "Has retail competition reduced residential electricity prices in Texas?," Utilities Policy, Elsevier, vol. 84(C).

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    More about this item

    Keywords

    Restructuring; Electricity; Price freeze;
    All these keywords.

    JEL classification:

    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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