Energy markets – Page 92 – Knowledge Problem

Draft Report to Congress on Wholesale and Retail Competition in Electricity

4 Comments / Economics, Electricity, Energy markets / By Lynne Kiesling

Lynne Kiesling Yesterday the Federal Energy Regulatory Commission released the draft Report to Congress on Competition in the Wholesale and Retail Markets for Electric Energy on behalf of the Electric Energy Market Competition Task Force. This report, required by Section 1815 of the Energy Policy Act of 2005, provides an overview and summarizes the progress …

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Your Chance to Tell the Feds About Electric Market Competition

5 Comments / Electricity, Energy markets, Politics / By Michael Giberson

Michael Giberson Wish you could tell the federal government just what was wrong (or right) with the state of competition in electricity markets? Here is your chance: Section 1815 of the Energy Policy Act of 2005 requires the Electric Energy Market Competition Task Force to conduct a study and analysis of competition within the wholesale …

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Martin Feldstein in Wsj on “Tradeable Gasoline Rights”

6 Comments / Economics, Energy markets, Environmental policy / By Lynne Kiesling

Lynne Kiesling Martin Feldstein has a column in today’s WSJ (subscription required) in which he recommends that the government issue tradeable gasoline rights (TGRs) instead of either raising CAFE standards or imposing a gasoline tax. In a system of tradeable gasoline rights, the government would give each adult a TGR debit card. The gasoline pumps …

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Fair Trade in Green Power?

1 Comment / Electricity, Energy markets, Environmental policy / By Michael Giberson

Michael Giberson Newsday reports that some consumers “feel ‘ripped off’ by LIPA’s alt-energy plan.??? Ratepayers who sign up for Green Choice permit LIPA to add an average premium of 1 to 2 cents a kilowatt hour, or $4 to $15 a month, to their bills. LIPA sends that to one of two green-power marketing companies …

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Mankiw: Nothing Funky Going On at the Rental Counter

3 Comments / Energy markets / By Michael Giberson

Michael Giberson At Greg Mankiw’s blog he cites a Wall Street Journal article claiming some “funky economics” are happening at the car rental counter, as renters increasingly are choosing smaller, more fuel-efficient cars in the face of higher gasoline prices. As Mankiw points out, there’s nothing funky going on, Gas and Guzzlers are Complements.

Yes, Very Expensive

35 Comments / Economics, Energy markets / By Lynne Kiesling

Lynne Kiesling The outright demagoguery from DC is disgusting but not surprising. More FTC studies of “price gouging”, more threats of “windfall profits” taxes, more ranting and puffery. Ladies and gentlemen (and I use that moniker to be polite, not truthful) of Congress, look within yourselves if you want a true explanation for the increase …

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Gas Prices: An Expensive “I Told You So”

2 Comments / Economics, Energy markets / By Lynne Kiesling

Lynne Kiesling Energy Economics 101 Spring 2006 Professor Kiesling Homework Assignment to Congress Suppose producers in an economy produce a good, G. Suppose further that the consumption of G creates a negative effect, E, that is borne by more people than just the person consuming G. Now suppose that to reduce E, the government passes …

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Reading Energy News on a Friday Afternoon

5 Comments / Energy markets / By Michael Giberson

Michael Giberson The Washington Post ran a good story on gasoline prices on the front page of today’s edition. But the following sentence caught my eye, and raised perhaps imponderable questions: “In the absence of a clear explanation, members of Congress have jumped into the fray.” After enough members of Congress jump into a fray, …

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More Contango Thoughts

9 Comments / Economics, Energy markets / By Lynne Kiesling

Lynne Kiesling In a full-information equilibrium in a liquid market, the forward price should exactly equal the spot price plus the carrying cost (storage cost plus foregone interest)[NOTE: I updated this to change the typo that the first comment caught, good catch!]. Thus you can explain the current increase in the crude spot price as …

Oil: Shall We Contango?

1 Comment / Economics, Energy markets / By Lynne Kiesling

Lynne Kiesling Oil prices today are the highest (nominal) prices ever, over $71. Some of the driver of this price increase is uncertainty surrounding Iran. But what’s really interesting from an economic perspective right now is that oil markets are in contango, and have been in contango since early this year. Wikipedia defines contango thus: …

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