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Benefits of competitive energy markets

With many years of data available for analysis, there is ample evidence that competitive electricity markets deliver reliability and economic benefits for both wholesale and retail consumers. That evidence is detailed in a number of studies, reports and white papers, many written by independent entities.

 

ISO/RTO Council (IRC)

The ISO/RTO Council (IRC) is an industry organization consisting of representatives from the 10 Independent System Operators (ISOs) and Regional Transmission Organizations (RTOs) in North America. Collectively these organizations serve two-thirds of electricity consumers in the United States and more than 50 percent of Canada's population.

2009 State of the Markets Report

This report reveals that organized competitive markets are shattering barriers for renewable and demand response resources; creating new efficiencies in plant operations; significantly improving grid reliability; sending clear, timely, and transparent pricing signals; and expanding regional planning. Authored by IRC (09/2009)
 

IRC-authored studies and papers
Studies and papers on the benefits of competitive markets and IRC services are available on the council's website:

Ten Reasons ISO/RTOs are Good for North America - May 2007

 

Myths and Facts about Competitive Wholesale Energy Markets - May 2007 
 

The Value of Independent Regional Grid Operators - November 2005

This white paper explains the core functions and key benefits of ISOs and RTOs. It highlights the financial benefits of increased reliability, more efficient use of the grid, reduced reserve requirements, and coordinated planning for new generation and transmission resources.
 

Center for the Advancement of Energy Markets

The Center for the Advancement of Energy Markets is an independent, non-profit, public policy think-tank that supports a transition from energy monopolies to an open-access, customer choice world.

Market-Based Electricity Solutions Could Save U.S. Consumers $19 Billion Annually

This study by the Center for the Advancement of Energy Markets concludes that market-based approaches to improving reliability, including market-based demand response initiatives and distributed energy will more closely link consumer preferences and consumption levels with costs.

 

Institute of Electrical and Electronic Engineers

Wind Energy Delivery Issues

An article published in the November/December 2005 issue of Power and Energy, a magazine published by the Institute of Electrical and Electronic Engineers (IEEE). Power industry experts examined the role of competitive markets in fostering renewable energy and found restructured, market-based power systems are very friendly to renewable energy resources and continue to make strides. Previous issues of Power and Energy are available on their website.

 

Cambridge Energy Research Associates

Beyond the Crossroads: The Future Direction of Power Industry Restructuring

A Cambridge Energy Research Associates’ study finds that the conventional wisdom about power price increases is at odds with the real prices. They calculate $34 billion in savings has been achieved. This is over the past seven years and compares the actual amount paid to an amount calculated that would have been paid under traditional regulation. Authored by Cambridge Energy Research Associates (11/2005)

 

Midwest ISO


ICF Consulting Study

An independent consultant prepared a study assessing the benefits of the Midwest ISO to consumers. Issued in October of 2005, it corroborates earlier studies that found significant cost reductions delivered to both wholesale clients and end-use electrical customers. The study is on the Midwest ISO website.

 

ISO New England


Progress of New England's Restructured Electric Industry and Competitive Markets

An internal assessment of the benefits ISO-NE provides to its customers published April 2005.

ISO New England: Delivering Value to the Region -- September 2005

Following publication of the above report, the CEO of ISO-NE delivered a speech to a regional energy forum in September 2005.