Energy Law Journal Publishes Article by EI Economists Morris, Dutra, and Snow Cobb.

The May 2021 issue of the Energy Law Journal contains an article by EI economists John R. Morris, Jéssica Dutra, and Tristan Snow Cobb.  Alternative Measures of “Representative Market Prices” for FERC Delivered Price Tests evaluates four methodologies for calculating representative market prices for the Federal Energy Regulatory Commission’s methodology screening whether mergers are likely to create or enhance market power in electric power markets.  The paper concludes that the typical practice of using average historical market prices as the basis for estimating potential future prices is the least likely to accurately assess market power.  Alternatives such as using historical median price levels, prices that accurately match generation levels, and prices consistent with simple dispatch model simulations are more accurate at finding potential market power issues.  The article can be found an Energy Law Journal, Vol. 42, No. 1 (2021), available at https://www.eba-net.org/assets/1/6/9_-_[Morris_et_al][191-235].pdf.