Electricity markets: an overview and comparative study

Purpose – The electric power industry has been moving from a regulated monopoly structure to a deregulated market structure in many countries. The purpose of this study is to comprehensively review the existing markets to study advantages, issues involved and lessons learnt to benefit emerging electricity markets. Design/methodology/approach – The paper employs a comprehensive review of existing competitive electricity market models in USA (California), UK, Australia, Nordic Countries (Norway), and developing country (Chile) to analyze the similarities, differences, weaknesses, and strengths among these markets based on publically available data, literature review and information. Findings – Ongoing or forthcoming electricity sector restructuring activities in some countries can be better designed based on lessons learnt from existing markets and incorporating their own political, technical and economical contexts. A template for design of successful electricity market has also been presented. Research limitations/implications – This study is limited to a comparative analysis of five markets and can be extended in the future for other existing and emerging electricity markets. Practical implications – The discussed weaknesses and strengths of existing electricity markets in this study can be practically utilized to improve the electricity industry market structures leading to several social benefits including lower electricity cost. Originality/value – The comprehensive review and analysis of five existing markets, physically located in different continents, may be used as an assistance or reference guide to benefit the emerging electricity markets in other countries.