Will competition hurt electricity consumers in the Pacific Northwest

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A computer model was developed at Oak Ridge National Laboratory to analyze the electricity production, costs, and prices for two geographical regions for a single year. Bulk-power trading is allowed between the two regions and market clearing prices are determined based on marginal costs. The authors used this model, ORCED, to evaluate the market price of power over the year 2000 in the Pacific Northwest and California. The authors found that, absent intervention by the regulators in the Northwest, generation prices would increase 1.1 {cents}/kWh on average, from 1.91 {cents}/kWh for the regulated price to 3.02 {cents}/kWh as the competitive ... continued below

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11 p.

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Hadley, S. & Hirst, E. November 1998.

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Description

A computer model was developed at Oak Ridge National Laboratory to analyze the electricity production, costs, and prices for two geographical regions for a single year. Bulk-power trading is allowed between the two regions and market clearing prices are determined based on marginal costs. The authors used this model, ORCED, to evaluate the market price of power over the year 2000 in the Pacific Northwest and California. The authors found that, absent intervention by the regulators in the Northwest, generation prices would increase 1.1 {cents}/kWh on average, from 1.91 {cents}/kWh for the regulated price to 3.02 {cents}/kWh as the competitive price. If regulators use transition charges and price caps, then customers in the Pacific Northwest need not be penalized by the change to marginal-cost pricing. Customer responses to price changes will increase the transfer of power between regions. A gas price increase of 20%, while only raising the average-cost-based price to 1.95 {cents}/kWh, raised the marginal-cost-based price to 3.56{cents}/kWh. Reductions in hydroelectric resources also dramatically change the price and flow of power.

Physical Description

11 p.

Notes

OSTI as DE99000370

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  • 21. annual international conference of the International Association of Energy Economists, Quebec City (Canada), 13-16 May 1998

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  • Other: DE99000370
  • Report No.: ORNL/CP--98924
  • Report No.: CONF-980553--
  • Grant Number: AC05-96OR22464
  • DOI: 10.2172/573097 | External Link
  • Office of Scientific & Technical Information Report Number: 676963
  • Archival Resource Key: ark:/67531/metadc705975

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Office of Scientific & Technical Information Technical Reports

Reports, articles and other documents harvested from the Office of Scientific and Technical Information.

Office of Scientific and Technical Information (OSTI) is the Department of Energy (DOE) office that collects, preserves, and disseminates DOE-sponsored research and development (R&D) results that are the outcomes of R&D projects or other funded activities at DOE labs and facilities nationwide and grantees at universities and other institutions.

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  • November 1998

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  • Sept. 12, 2015, 6:31 a.m.

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  • May 20, 2016, 3:12 p.m.

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Hadley, S. & Hirst, E. Will competition hurt electricity consumers in the Pacific Northwest, article, November 1998; Tennessee. (digital.library.unt.edu/ark:/67531/metadc705975/: accessed December 11, 2017), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.