The effectiveness of FERC's transmission policy: Is transmission used efficiently and when is it scarce?

Andrew N. Kleit, James D. Reitzes

Research output: Contribution to journalArticlepeer-review

7 Scopus citations

Abstract

We investigate the impact of FERC's policy to create Independent System Operators (ISOs) that independently manage regional electricity transmission resources and institute regional electricity exchange markets. Our analysis examines how the formation of the PJM ISO affected inter-regional electricity trading costs during the period from March 1997 to June 2002. We also examine how ISO formation affected the likelihood of encountering "congestion" in trading electricity between PJM and adjoining regions (particularly the New York ISO and the more loosely organized East Central Area of Reliability (ECAR)). In addition, our analysis estimates the marginal economic value of increased inter-regional transfer capability.

Original languageEnglish (US)
Pages (from-to)1-26
Number of pages26
JournalJournal of Regulatory Economics
Volume34
Issue number1
DOIs
StatePublished - Aug 2008

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics

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