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| Author: | Decker, C. Keyworth, T. |
| Title: | Competition Law and Commodity Markets: The Case of Wholesale Electricity |
| Journal: | Economic Affairs
2002 : DEC, VOL. 22:4, p. 32-39 |
| Index terms: | COMPETITION MARKETS COMMODITY MARKETS ELECTRICITY SUPPLY INDUSTRY |
| Language: | eng |
| Abstract: | This paper considers some of the challenges that the exercise of market power in commodity markets poses for public policy, focusing on the case: of wholesale electricity. The particular economic characteristics of where the price elasticities of both j demand and supply are very low. Under such conditions, it may not be necessary for a supplier to have control over a large share of available capacity to be able to exercise substantial market power. This paper questions whether the two principal existing forms of supervision of these markets, Competition Law and financial regulation, are sufficient to address the types of problems that can be expected to arise given these characteristics. The answer to that question is in the negative. |
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