Business Intelligence

Price Transmission In The UK Electricity Market: Was NETA Beneficial?

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Executive Summary

This paper explores the relationship between domestic retail electricity prices in Great Britain and their determinants in the particular context of the New Electricity Trading Arrangements (NETA) introduced in 2001. The analysis requires a consistent comparison of wholesale power price series before and after NETA, which the authors investigate using a range of wholesale future price series. Despite its stated intention of reducing prices, they conclude that the net effect of NETA alongside other developments instead merely rearranged where money was made in the system.

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