Lynne Kiesling
I seriously gave myself an injury yesterday morning when I saw the Wall Street Journal article on the Congressional bill to nationalize hurricane reinsurance. Have we learned nothing about moral hazard from flood insurance, from the savings and loan fiasco, and so on?
So I’m glad that Tim Haab’s on the case, pointing out the stupidity of such a policy. Please go read his remarks, but only after you have put something soft on the desk in front of you, for your own protection.
Lynne Kiesling
One of the things I like about publication is that I don’t ever seem to lose that childlike fascination that Steve Martin had in The Jerk when he saw his name in the phone book and declared “I’m somebody!”
With that same childlike fascination I am pleased to announce that you can now pre-order my forthcoming book on electricity restructuring at Amazon. And I just put the edited page proofs in the mail to the publisher yesterday. Here’s a summary of what it’s about:
Over the past 50 years the US economy has experienced economic dynamism and technological change at a dizzying pace, driven substantially by innovation in digital communication technology. This dynamism has had limited effects in the electricity industry, and institutional change within the industry to adapt to these changes has been variable. Many states in the U.S. do not participate in open wholesale markets, and even more states have either no retail markets or have implemented such a restricted and politicized version of retail markets that potential retail market entrants still face substantial entry barriers. This book explores institutional design and regulatory policies in the US electricity industry that can adapt to unknown and changing conditions produced by economic, social, and technological change.
Whereas the dominant regulatory paradigm has traditionally been centralized economic and physical control based on natural monopoly theory and power systems engineering, the ideas presented and synthesized by Kiesling compose a different paradigm – decentralized economic and physical coordination through contracts, transactions, price signals, and integrated intertemporal wholesale and retail markets. Digital communication technology, and its increasing pervasiveness and affordability, make this decentralized coordination possible. Kiesling argues that with decentralized coordination, distributed agents themselves control part of the system, and in aggregate their actions produce order. Technology makes this order feasible, but the institutions, the rules governing the interaction of agents in the system, contribute substantially to whether or not order can emerge from this decentralized coordination process.
This book will be of interest to students and researchers engaged with electricity regulation and deregulation in the US, as well as institutional economics and technological change in industry.
Although they didn’t get the title quite right; it’s Deregulation, Innovation and Market Liberalization: Electricity Regulation in a Continually Evolving Environment.
Lynne Kiesling
Wired provides a wiki for collecting ideas and techniques for automating your home. Even though we do not yet have widespread retail choice in electric power service as residential customers, these ideas can reduce energy bills and reduce overall resource use:
Aside from the nerd bragging rights, fully-automated homes can be much more energy efficient. Left the light on in the basement after that last-minute laundry dash? That’s money out of your pocket. But an automated home could have killed the lights as soon as you came upstairs.
Ditto for the A/C you left running all night or the blinds you always forget to close in the afternoon heat. Your forgetfulness is wasting money and using energy you don’t need to use. Automation cuts down on your energy use by doing the smart and simple tasks for you.
Aside from the potential savings in money and energy, you can perform other practical tasks like monitor your pets, detect unwanted visitors or even send yourself an e-mail when the water pipes in your basement burst.
And then just imagine how valuable and useful it will be to have that automation capability once we really do get retail dynamic pricing! Then we really can deliver on the promise of sending prices to people, and their devices!
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