USA • Market power A DoE report on market power has found evidence of price fixing among utilities. In regions where the concentration of capacity with a company is high and transmission constrained, firms can cut output and raise prices.
The analysis shows that in both the US and UK, wholesale prices have been boosted by as much as 75 per cent, even where competition is evident.
In the wake of the DoE study, an independent consulting firm has found AEP and Entergy have also been behaving in an opportunistic way to restrict third party access to their transmission networks. The study, by Tabors, Caramanis & Associates, examined events in the Southeast and Midwest during the 1999 price-spikes and found that both companies had exaggerated their requirements for transmission capacity.