In the EU electricity industry, many Vertically Integrated Utilities (VIUs) have ownership both of electricity generators and of transmission, hence VIU-owned or allied generators often are bidders in auctions for VIU-owned transmission. In Van Koten (2006) I show that welfare suffers and the...

In this paper we will examine the issue of ownership unbundling and forced divestiture remedies imposed in a series of recent competition law cases of the energy market - examined in other papers - in relation to the possible existence of a series of legal obstacles. These energy market...

This paper characterises the impact of vertical integration on price equilibria and incentives to strategically withhold capacity in a wholesale electricity auction. A two-stage game is analysed where vertically integrated firms first declare the quantity of electricity available and then...

We present experimental results from a series of sessions organized using the Power Market simulator; a software designed to realistically replicate the Spanish Electricity Market. In the experiments reported here we compare the status quo to two alternative treatments which represent...

Theory and empirics suggest that by curbing competition, incumbent electricity companies which used to be and here are referred to as Vertically Integrated Utilities (VIUs), can increase their profitability through combined ownership of generation and transmission and/or distribution networks....

Incumbent vertical market power in deregulating markets can be anticompetitive, as seen in the current process of retail electricity restructuring. This paper uses the AT&T antitrust case’s Bell Doctrine precedent of “quarantine the monopoly” as a case study in incumbent vertical market...

The paper tackles the discussion about vertical separation in the electronic communications sector, in its two main forms functional and structural. The author will argue how mandatory structural separation under certain conditions could be a possible option. The evidence is provided by the...

This paper examines the impact on transmission investment of the transition away from central planning by vertically integrated electric utility monopolies toward Independent System Operators (ISOs) and market incentives. After summarizing the regulatory background of the new ISOs and the...

This paper provides a prospective and retrospective quantitative assessment of the impact of a passive vertical integration between a large electricity retailer and a large electricity generator in the Australian National Electricity Market (NEM). We adapt a standard model of fixed-price forward...

Vertical separation of generation from electricity retailing has often been required as a condition of electricity market liberalisation. A well-developed and liquid contracts market is similarly suggested as necessary to manage the resulting wholesale market risks, which risks are further...