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Showing posts from January, 2017

Opinion: The economics of municipalization

“Those who cannot remember the past are condemned to repeat it.”  Originally electric utilities in the U.S. competed with each other by covering the streets with multiple sets of wires, but this competition lowered prices and cut profits. Then, roughly 100 years ago, these utilities realized that it would be a lot more profitable to not compete but rather to control their regulators. Thus was born the regulated private monopoly structure we now have. As new power plants got bigger, the unit price of electricity dropped, so customers could tolerate these excess profits. (Nonprofit public utilities also emerged as an alternative. Per the American Public Power Association, Colorado now has 31, and all 151 utilities in Nebraska are public.)  Recently, the for-profit private vertically integrated monopoly structure has begun to break up. Large sectors of the country(but not Colorado) now have competitive markets for electricity supply, independent system operators that match...