[en] Highlights: • We examine regulation and performance of the Dutch electricity retail market. • Regulation is fairly intensive and encompasses various types of measures. • Retailers increasingly offer different types of retail products. • Gross retail margins remain relatively high, as is price dispersion across retailers. • The market matured, as evidenced by few consumer complaints and high switching rates. -- Abstract: This paper examines market structure, regulation, and market performance of the Dutch electricity retail market for households since its opening in 2004. Using data containing monthly prices for all products offered in the Dutch retail electricity markets over the period 2008–2014, we provide quantitative results on the intensity of retail competition and the benefits to consumers. Regulation of the retail electricity market is relatively intensive and encompasses structural measures, contractual restrictions, rules on information provision, price surveillance and market monitoring. In contrast to most other countries, the Dutch regulation includes a kind of price regulation which is that the regulator surveys all new retail prices before market introduction in order to prevent too high retail prices. The Dutch retail electricity market has remained relatively concentrated, with retailers offering an increasing variety of retail products, often using multiple brands. Competition is characterized by product innovation, especially for green energy, rather than price competition on homogenous products. Gross retail margins remain relatively high, as is price dispersion across retailers. The market matured, as evidenced by fewer consumer complaints and higher switching rates.

[en] The recent increases in the price of automotive fuels, especially gasoline is discussed. The Canadian Automobile Association (CAA) makes several recommendation as to how the government might intervene to bring prices back down to a realistic level. First and foremost, the CAA recommends an outright gasoline tax cut, noting that tax on gasoline has increased from 1.5 cent to 10 cents a litre since 1885. The CAA also suggests that a minimum of 5 cents reduction in price would result if the GST were applied only on an ex-tax basis instead of being tacked on to the total pump price after federal and provincial taxes have been added, which in effect amounts to a tax on tax. The provinces could also help by cutting back on their gasoline taxes which range from a low of 9 cents in Alberta to a high of 16.5 cents in Newfoundland. It is noted that the Ottawa-based Canadian Petroleum Products Institute, which represents the major oil companies, does not support the CAA suggestions and dismisses concerns regarding the near-monopoly in the market held by a few major oil companies by saying that while there are admittedly fewer small independents in the market, competition from new larger entrants has actually increased. The Institute spokesman attributes the recent round of price increases as merely the results of world market forces (despite the fact that Canada is a net exporter of oil). At the same time, the Independent Retail Gasoline Merchant Association wants the government to conduct a fundamental review of the Competition Act, to harmonize Canadian laws with those of the United States, our largest trading partner. The Association believes that the Competition Bureau has evolved into a a quasi-judicial body, and is mired in red tape. The Association also suggests that in the meantime, the government should invoke the Energy Supplies Emergency Act to stop Big Oil's 'deceitful price gouging'

[en] An inquiry was initiated by the President of the Quebec Energy Board (Regie de l'energie) on October 7, 1999 to review the reasons for the wide fluctuations in the retail sale prices of gasoline and diesel fuel in the regions of Abitibi-Temiscamingue, Saguenay/Lac-Saint-Jean and the Upper Mauricie, although the Board has no jurisdiction over the prices charged for petroleum products or anti-competitive practices. Consequently, the inquiry confined itself to an analysis of the information pertaining to the structure and forces driving the petroleum products market, and an examination of price mechanisms and consumer reactions in these regions. The inquiry reviewed the relevant legislation and regulation, the social, economic and energy situations in the affected regions, and the structure and functioning of the market for gasoline and diesel fuel. The inquiry came to the conclusion that the price fluctuations during the period under review reflected the wholesale prices recorded at Montreal and Quebec, which are determined by national and international market forces over which Quebec has no significant control. Furthermore, the inquiry concluded that although market forces are present and functioning in the regions, there are relatively few outlets affiliated with major oil companies, and a large number of independent retail outlets with relatively small volumes of annual sales. They essentially set their own prices at a level that reflect their cost of operation. Appendices contain the Inquiry's mandate, a list of those who testified before the Inquiry, a map showing the geographic profile of the regions surveyed and a list of figures and tables. 18 tabs., 31 figs

[en] A comparison is presented of the economies of scale achieved by the gasoline retailing sector in Canada and the United States over the period 1980-1990. Gasoline demand increased steadily in the USA and by 1990 was 10% higher than in 1980, while in Canada the fluctuating demand has led to a 12% decline for the same period. Number of automobiles increased 23% in Canada compared to 19% in the USA, while number of retail outlets fell by 5,000 in Canada and 47,000 in the USA. The average distance travelled by automobile increased 11% and 7%, respectively for Canada and the USA, however Canadians drove 7% further than Americans. In 1990, automobiles used ca 200 litres less fuel per year in Canada than the USA. Average sales per outlet increased by 56% in the USA and 10% in Canada. While most of the price difference between American and Canadian gasoline is attributable to taxes, the larger size of American refineries, transportation costs, product slate and product demand affects prices. 6 figs

[en] The Italian Competition Authority opened a new procedure dealing with gasoline retail activities and with the alleged collusion between the main companies of this sector. The preliminary adversary arguments do not seem to be firm enough to pass through a possible appeal to the Italian administrative courts. This is why the Authority and the companies could agree and binding commitments in order to close the case in advance

[en] On January 1, 2007, the Electric Reliability Council of Texas (ERCOT) market became the first restructured market in the US to completely remove caps on the prices which could be charged to residential energy consumers by the retailers associated with the traditional or incumbent utility service providers. Our analysis suggests that the expiration of the price-to-beat (PTB) price caps may have led to a reduction in the average prices charged by competitive retail electric providers (REPs). (author)

[en] Highlights: • Greater political control allows more deviations between prices and marginal costs. • Competitive area residential and commercial prices better reflect costs. • Residential margins declined in competitive but not non-competitive areas. • More commercial to residential cross-subsidization in non-competitive areas -- Abstract: Electricity market reforms have pursued two goals, both aimed at increasing economic efficiency. The first is to ensure that suppliers minimize costs. The second is to make prices more reflective of marginal costs. We use data from Texas to examine whether post-reform retail prices have better reflected wholesale prices, and whether reform has reduced retailer costs. We find clear evidence of both outcomes in competitive market areas but not in non-competitive areas supplied by municipally-owned utilities or co-operatives.

[en] Barriers to competitive supplier entry such as California's wholesale-price pass-through model can provide an almost insurmountable barrier to effective retail competition. The telecommunications, airline, and software industries provide lessons--positive and negative--on how creating competitive wholesale markets is insufficient to bring the benefits of competition to smaller consumers

[en] William Hogan introduced financial transmission rights as a tool to hedge the locational risk inherent in locational marginal prices. FTRs are claimed to serve four main purposes: (1) provide a hedge for nodal price differences, (2) provide revenue sufficiency for contracts for differences, (3) distribute the merchandizing surplus an RTO accrues in market operations, and (4) provide a price signal for transmission and generation developers. This paper examines the hedging and redistributional properties of FTRs. It argues that FTR allocation has important distributional impacts and related implications for retail rates. This observation adds an additional explanation for rate increases in light of decreased production costs due to restructuring. This paper also shows that RTO practices have important implications for the hedging characteristics of FTRs. It further shows, via counterexample, that, even in theory, FTRs may not serve as a perfect hedge against congestion charges. The paper concludes with a series of recommendations for FTR allocation and the functions that FTRs should serve. (author)

[en] Highlights: • The results reveal that the cost pass-through is more than complete. • The pass-through rate increase year by year. • The cost pass-through of dominant and vertically integrated retailers is higher. • The pass-through rate varies regarding to household income groups. • Retailers have little incentive to adjust profit margins after a cost shock. This paper estimates the pass-through of prices from wholesale to retail using monthly data for the period January 2017–March 2020 for residential users in the Colombian electricity market, which is characterized by large hydroelectric capacity and inelastic demand. Although much of the literature has found the pass-through rate to be incomplete, results are consistent with other studies that have been conducted for electricity markets and have shown that firms have no incentive to adjust their profit margins in the face of a cost shock. These results also converge with the regulatory framework of the retail electricity market in Colombia. In particular, the results reveal that the cost pass-through is more than complete with a rate of 115%. There is also evidence of an increase in the magnitude of the cost pass-through year by year. When analyzed by type of retailer, the results suggest that the cost pass-through of two major dominant and vertically integrated retailers is statistically higher than the remaining retailers with a pass-through close to 120%, suggesting that dominant retailers integrated with power generation could exercise market power.