Economics of electricity deregulation and privatization: An introductory survey

This paper is intended as an elementary survey of the electricity deregulation-privatization debate as it is being carried out in both the developed and developing world. An attempt is made to clarify certain misunderstandings about introducing more competition into electricity-supply systems, bringing such things as share and derivative markets into the analysis. Among the most important points mentioned here are that the deregulation experiment in the U.K. is, in reality, reregulation, and the intended equilibrium price of electricity is the long run marginal cost.