Imperfect Markets versus Imperfect Regulation in US Electricity Generation

• 成果类型: Article
• 署名作者: Cicala, Steve
• 署名单位: Tufts University
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.20172034
• 发表日期: 2022
• 页码: 409-441
• 关键词: POWER; COSTS; inefficiencies; EFFICIENCY

摘要

This paper evaluates changes in electricity generation costs caused by the introduction of market mechanisms to determine production in the United States. I use the staggered transition to markets from 1999 to 2012 to estimate the causal impact of liberalization using a differences-in-difference design on a comprehensive hourly panel of electricity demand, generators' costs, capacities, and output. I find that markets reduce production costs by 5 percent by reallocating production: gains from trade across service areas increase by 55 percent based on a 25 percent increase in traded electricity, and costs from using uneconomical units fall 16 percent.