Why did British Electricity Prices Fall after 1998?
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Authors
Evans, Joanne
Green, Richard J.
Publication Date
2004-06-16Series
Cambridge Working Papers in Economics
Publisher
Faculty of Economics
Language
en_GB
Type
Working Paper
Metadata
Show full item recordCitation
Evans, J., & Green, R. J. (2004). Why did British Electricity Prices Fall after 1998?. https://doi.org/10.17863/CAM.5453
Abstract
In an attempt to reduce high electricity prices in England and Wales the government has reduced concentration among generators and introduced New Electricity Trading Arrangements (NETA). Econometric analysis on monthly data from April 1996 to September 2002 implies support for two conflicting hypotheses. On a static view, increases in competition and the capacity margin were chiefly responsible for the fall in prices. If generators had been tacitly colluding before NETA, however, the impending change in market rules might have changed their behaviour a few months before the abolition of the Pool. That view implies that NETA reduced prices.
Keywords
Classification-JEL: L94, Electricity, market power, concentration, market rules
Identifiers
This record's DOI: https://doi.org/10.17863/CAM.5453
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