PEN-L message, Re: deregulation

Yes, people know about it but the money involved in the massive mergers and take-overs swamps sensible policy. The labor union at EDF, the giant French electric utility fought very hard to stop European dereg and failed. Some European economists and labor advocates are quite knowledgeable but that is scant protection against big money.

The deregulation movement was actually launched in the UK -- well before the California blunder. In fact California regulators made trips to the UK to learn the benefits and how to do it. That was before the UK actually was revealed to be as bad a mistake as California made. It was a triumph of neo-liberalism.

The California crisis is explained away by free market stalwarts at US universities, specifically Stanford, UC Berkeley and MIT. Unrepentant cheerleaders for staying the course. The feature US regulator of electric power, FERC, is undetered by the blow ups in California, Texas and elsewhere and is relentless in pursuing further deregulation. The FTC held a conference on April 10-12th, featuring academics from Stanford and UC Berkeley, titled ""Energy Markets in the 21st Century: Competition Policy in Perspective," .

The advocates for going forward, both in Europe and in the US are the power producers who want to be free to sell power at high prices. Paired with them are the big industrial energy users who want to buy power at low prices. That can't work, ... unless they can get the burden of paying the fixed costs on the small customers, which is what deregulation will attend to.

Michael, you wrote about this in you recent book. Nothing has changed in academia in 100 years.

Gene Coyle

On Apr 13, 2007, at 3:01 PM, Michael Perelman wrote:

Why is Europe deregulating energy? Don't the people there know about the US
experience?
--
Michael Perelman
Economics Department
California State University
Chico, CA 95929

Tel. 530-898-5321
E-Mail michael at ecst.csuchico.edu
michaelperelman.wordpress.com