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Screening for Collusion in Wholesale Electricity Markets: A Review of the Literature

Author

Listed:
  • Brown, David P.

    (University of Alberta, Department of Economics)

  • Eckert, Andrew

    (University of Alberta, Department of Economics)

  • Silveira, Douglas

    (University of Alberta, Department of Economics)

Abstract

Wholesale electricity markets have several features that increase the likelihood of collusion, including frequent interaction, multimarket contact, and a high degree of information transparency. As a result, screening techniques for detecting collusive agreements are desired. In this paper, we survey the existing literature on collusive screens and collusion in electricity markets. We discuss key features of non-competitive behaviour to be reflected in screens and suggest directions for improved screening in this industry. In particular, there is considerable potential to include machine learning and data mining techniques in screens in the electricity sector due to recent improvements in these methods.

Suggested Citation

  • Brown, David P. & Eckert, Andrew & Silveira, Douglas, 2023. "Screening for Collusion in Wholesale Electricity Markets: A Review of the Literature," Working Papers 2023-7, University of Alberta, Department of Economics.
    • Handle: RePEc:ris:albaec:2023_007
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    References listed on IDEAS

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    More about this item

    Keywords

    Screening Methods; Collusion; Electricity Markets;
    All these keywords.

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L40 - Industrial Organization - - Antitrust Issues and Policies - - - General
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General

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