[opendtv] Re: Electric power as a natural monopoly

  • From: Mark Schubin <tvmark@xxxxxxxxxxxxx>
  • To: opendtv@xxxxxxxxxxxxx
  • Date: Sat, 08 Feb 2014 07:12:29 -0500

On 2/7/2014 10:07 PM, Craig Birkmaier wrote:

On Feb 7, 2014, at 8:07 PM, "Manfredi, Albert E" <albert.e.manfredi@xxxxxxxxxx <mailto:albert.e.manfredi@xxxxxxxxxx>> wrote:

Really? Are you saying that there are multiple different companies that have erected their own high tension lines between two adjacent cities, any of which can carry the full load?

Not at all. The transmission lines are a shared resource. From Wiki:

In the United States <http://en.wikipedia.org/wiki/United_States> in the 1920s, utilities joined together establishing a wider utility grid as joint-operations saw the benefits of sharing peak load coverage and backup power. Also, electric utilities were easily financed by Wall Street <http://en.wikipedia.org/wiki/Wall_Street> private investors who backed many of their ventures. In 1934, with the passage of the Public Utility Holding Company Act <http://en.wikipedia.org/wiki/Public_Utility_Holding_Company_Act> (USA), electric utilities were recognized as public goods <http://en.wikipedia.org/wiki/Public_good> of importance along with gas, water, and telephone companies and thereby were given outlined restrictions and regulatory oversight of their operations. This ushered in the /Golden Age of Regulation/ for more than 60 years. However, with the successful deregulation of airlines and telecommunication industries in late 1970s, the Energy Policy Act (EPAct) of 1992 <http://en.wikipedia.org/wiki/Energy_Policy_Act_of_1992> advocated deregulation of electric utilities by creating wholesale electric markets. It required transmission line owners to allow electric generation companies /open access/ to their network.The act led to a major restructuring of how the electric industry operated in an effort to create competition in power generation. No longer were electric utilities built as vertical monopolies, where generation, transmission and distribution were handled by a single company. Now, the three stages could be split among various companies, in an effort to provide fair accessibility to high voltage transmission.

To the extent that is true of intercity, the same is true within my city. I pay different companies for my electrical generation and my electrical distribution. We have a choice of about a dozen companies for the generation. I've chosen one using wind power.


Other related posts: