The Evolution of Competition in the Electric Power Industry

This paper discusses the competitive pressures in the electric power industry, and the kinds of regulatory responses they are evoking. The paper begins with a discussion of the traditional structure and regulation of the electric power industry. It includes a discussion of some forces raising interest in allowing more competition in the industry. This discussion leads to more detailed descriptions of two important competitive forces affecting the industry. The paper concludes with a discussion of several current public policy initiatives, under consideration by the Federal Energy Regulatory Commission (FERC), which represent potentially important regulatory responses to some of these forces.