Electricity Restructuring: Securing Clean Power

Do liberalized electricity markets inevitably lead to poorer environmental performance? To answer this question, this paper examines the impact of restructuring on the environment; and the implications of restructuring for environmental policy in the United States, Great Britain, and Canada.

Document Highlights

Are liberalized electricity markets more polluting than those ruled by monopoly providers? And what are the implications of restructuring for environmental policy? These are the key questions that this third briefing in the Electricity Restructuring series addresses.

To answer them, Securing Clean Power examines a range of restructuring experiences in the United States, Great Britain, and Canada. It addresses the concern that restructured electricity markets might drive generators to expand production, using low-cost coal plants. While this is one possible outcome of restructuring, this briefing finds that the impact of liberalized markets on air emissions in any region will depend upon the complex effects they have on the supply of, and demand for, electricity.

This briefing highlights the importance of having carefully designed environmental policy in place in restructured markets. Such well-considered policy is vital in order to meet both economic and environmental objectives at least cost.