1.
Efficiency and Consumer Welfare Under Retail Electricity Deregulation (2024). Journal of Critical Infrastructure Policy.
Authors: Noah Dormady, William Welch, Yufan Ji, Stephanie Pedron, Abdollah Shafieezadeh, Alberto Lamadrid, Matthew Hoyt, Samantha Fox
Abstract:
Many critical infrastructure services operate under either price regulation or in deregulated systems. The grand policy experiment of deregulation has been heavily studied, but evaluations have been limited at the retail level where end-user prices are often difficult to obtain. This paper presents an in-depth look at the retail market for electricity in a retail deregulated, or restructured, market—Ohio. We build and introduce a comprehensive SQL database of every daily filed retail electricity offer over a nine-year period of study; over two-million records. We integrate this data with other external data sources and conduct a detailed descriptive analysis of market prices as observed by end consumers at the retail level. We find that the lion’s share of “competitive” retail electricity choice offers are more costly to consumers than the utility’s default service rate and have higher markups over the wholesale price, and we find that when prices exceed the default rate they do so by a considerably larger margin than when consumers observe savings. We also find that even well-informed consumers are able to find a welfare-improving rate relative to the default rate between only 43 and 59 percent of the time. We conclude with a discussion of implications, and root economic causes of the efficiency and consumer welfare problems we observe.
2.
Finding A Black Cat in a Coal Cellar: Ohio State University Study of Ohio’s Retail Electricity Markets Finds Majority of Retail Electric Supply Offers Have Not Been Cost Saving, Cost Saving Offers Difficult to Find. (2024). Policy Brief. John Glenn College of Public Affairs.
Authors: Noah Dormady, Ph.D.; Yufan Ji; William Welch; Abdollah Shafieezadeh, Ph.D.; Alberto J. Lamadrid, Ph.D.; Matthew Hoyt; Samantha Fox, Ph.D.
A public policy brief summarizing the results of Efficiency and Consumer Welfare Under Retail Electricity Deregulation.
Press Release Available Here: https://glenn.osu.edu/news/pa/retail-electricity-markets
3.
How Are Retail Prices Formed In Restructured Electricity Markets? Energy Economics (2025). Energy Economics.
Authors: Noah Dormady, Ph.D.; Alfredo Roa-Henriquez, Ph.D.; Matthew Hoyt; Matthew Pesavento, Ph.D.; Grace Koenig; William Welch; Zejun Li.
Abstract:
A key challenge in obtaining efficient and competitive retail rates in restructured electricity markets is constructing an appropriate default generation price. Default prices in restructured states are often set by competitive procurement auctions in which firms bid to supply a fixed percentage (i.e., tranches) of a utility’s full-requirements load obligation (supply, capacity, ancillary services, and sometimes transmission). Auction clearing prices serve as a price heuristic for other competitive retail supply offers on the open market. Default service also substitutes for competitive retail supply for customers that cannot or will not shop. The efficiency and competitiveness of these auctions, therefore, is of societal importance. In this paper, regression analysis is performed on a unique ten-year dataset of wholesale, retail, and input market parameters for Ohio’s four investor-owned utilities to evaluate factors that influence its auction results. The models indicate that auction clearing prices are determined in more complex ways than a simple pass through of wholesale market costs. They indicate that auction competitiveness is a key driver of efficient retail price. They also indicate that wholesale market volatility, which is more challenging for suppliers to hedge, leads to significantly inflated retail auction prices. The paper provides policy implications for the market design of competitive retail electricity markets.
4.
A Look Under the Hood: Unexpected Factors That Increase Retail Electricity Prices In Ohio. (2024). Policy Brief. John Glenn College of Public Affairs.
Authors: Noah Dormady, Ph.D.; Alfredo Roa-Henriquez, Ph.D.; Matthew Hoyt; Matthew Pesavento, Ph.D.; Grace Koenig; William Welch; Zejun Li.
A public policy brief summarizing the results of How Are Retail Prices Formed In Restructured Electricity Markets?
Press Release Available Here: https://glenn.osu.edu/news/unexpected-factors-increase-retail-electricity-prices-ohio
5.
Coming soon!