The impact of wholesale competition


Global Energy Decisions, Inc., provider of software, consulting and data solutions to the energy industry, has released a major study on the impact of wholesale competition in electricity markets. Entitled ‘Putting Competitive Power Markets to the Test’, the report concludes that competitive wholesale power markets in the eastern US and Canada produced at least $15 billion in customer savings during the period 1999-2003. A further result is seen in dramatically improved power plant efficiencies nationwide.

Global Energy used its power market simulation software and independent price forecast advisory service to compare two scenarios. The first simulated existing competitive market conditions, and the second modelled prices and costs as if competition had not existed. The savings identified resulted from competitive pressures associated with wholesale market operations that minimised fuel expenses, operating and maintenance costs, depreciation and taxes.