In the 1990s, Pennsylvania, and many other states, faced an energy crisis with electric supply shortages, rolling blackouts, and skyrocketing rates. At the time, the Commonwealth permitted monopoly control of the electric utility market. To address these issues, legislators took a bold step forward and in 1996 passed the Electricity Generation Customer Choice and Competition Act which opened the market to competition and required the utility companies to compete in the generation and sale of electricity.
Restructuring has resulted in additional benefits beyond the original intent of reliability and cost-savings, such as carbon emission reductions, product innovation, and variety and most importantly, a robust market. Today, many of the states that have protected the utility monopoly on the generation and sale of electricity are facing the same challenges as Pennsylvania prior to restructuring. States that have not restructured their electricity markets should consider the Pennsylvania model.
