[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.
TTFN,
Mark
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