Price Spike Reality: Debunking the Myth of Failed Markets
The data is in. Market power fails as an explanatory variable for episodes of high prices.
The past summer represented a key turning point in our understanding of deregulated wholesale power markets. Until then, it was possible to find major North American markets that lacked any experience with severe price spikes. Now that immunity is denied. Price spikes in California and other Western markets mean that the last regions bucking the trend have fallen in line.