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Have Customers Benefited from Electricity Retail Competition?

Listed author(s):
  • 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.

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File URL: https://sites.ualberta.ca/~econwps/2012/wp2012-21.pdf
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Paper provided by University of Alberta, Department of Economics in its series Working Papers with number 2012-21.

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Length: 38 pages
Date of creation: 01 Oct 2012
Date of revision: 01 Oct 2014
Handle: RePEc:ris:albaec:2012_021
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