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Competition in the Electricity Supply Industry

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  • Spalding, Brian

    (Pacific Power, Sydney)

Abstract

The electricity supply industry in South and East Australia has made major improvements in performance over the last five years. There is now a major thrust towards the introduction of a competitive electricity market in both generation and retail supply to further drive efficiencies. Generation is being separated from transmission, and retails supply is being ring fenced from the network. The use of the grid is to be separately charged from energy purchases. The first step towards a national competitive market has been the operation of a paper trial which simulated the competitive processes of a market across the five states that are already interconnected or have the potential to be electrically connected. The activity is now focussed on determining an appropriate way forward. There are however a significant number of issues that need to be addressed before any transition to a real competitive market can commence. How should the fixed costs of the grid be allocated to market participants? Will a competitive market deliver a reliable power system? Will it be possible to determine a consistent approach across all jurisdictions? Competition is to commence from July 1995.

Suggested Citation

  • Spalding, Brian, 1995. "Competition in the Electricity Supply Industry," Economic Analysis and Policy, Elsevier, vol. 25(1), pages 71-83, March.
    • Handle: RePEc:eee:ecanpo:v:25:y:1995:i:1:p:71-83
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    More about this item

    Keywords

    Electricity;

    JEL classification:

    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • L98 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Government Policy

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