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Have Customers Benefited from Electricity Retail Competition?


  • Su, Xuejuan

    () (University of Alberta, Department of Economics)


Compared to traditional cost-of-service (COS) regulation, electricity retail competition may lead to lower costs but higher markups. Thus, the net effect on electricity retail prices is ambiguous. This paper uses a difference-in-difference approach to estimate the impact. The results suggest that in restructured states, only residental customers have benefited from significantly lower prices but not commercial or industrial customers. Furthermore, this benefit is transitory and disappears in the long run. Overall, retail compettion does not seem to deliver lower electricity prices to retail customers across the board or over time.

Suggested Citation

  • Su, Xuejuan, 2012. "Have Customers Benefited from Electricity Retail Competition?," Working Papers 2012-21, University of Alberta, Department of Economics, revised 01 Oct 2014.
  • Handle: RePEc:ris:albaec:2012_021

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    References listed on IDEAS

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    2. repec:eee:eecrev:v:98:y:2017:i:c:p:354-372 is not listed on IDEAS
    3. Daglish, Toby, 2015. "Consumer Governance in Electricity Markets," Working Paper Series 4183, Victoria University of Wellington, The New Zealand Institute for the Study of Competition and Regulation.
    4. repec:eee:enepol:v:114:y:2018:i:c:p:274-287 is not listed on IDEAS
    5. Daglish, Toby, 2016. "Consumer governance in electricity markets," Energy Economics, Elsevier, vol. 56(C), pages 326-337.
    6. Duso, Tomaso & Szücs, Florian, 2017. "Market power and heterogeneous pass-through in German electricity retail," European Economic Review, Elsevier, vol. 98(C), pages 354-372.
    7. Brown, David P. & Eckert, Andrew, 2017. "The Effect of Default Rates on Retail Competition and Pricing Decisions of Competitive Retailers: The Case of Alberta," Working Papers 2017-6, University of Alberta, Department of Economics.

    More about this item


    electricity; restructuring; retail competition; difference-in-difference;

    JEL classification:

    • D42 - Microeconomics - - Market Structure, Pricing, and Design - - - Monopoly
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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