Bert Willems
Assistant Professor
TILEC & CentER
Tilburg University
Energy Regulation Workshop 3 December 2008, Tilburg
Energy regulation going forward: From cost efficiency to innovation and investment, (Registration).
Energy Economics Workshop 9 October 2008, The Hague
The Integration of European Electricity Markets, (Registration).
Market Power Mitigation By Regulating Contract Portfolio Risk
Until now the European Union has relied on standard competition rules to deal with abuse of market power in the generation sector. We argue that relying only on general competition rules is insufficient to address those concerns, given the specific characteristics of the electricity market and the high level of concentration in some segments. As a complementary ex ante regulation, we suggest regulators should incentivize firms to sign contracts with retailers by regulating their contract portfolio risk exposure, i.e. a capital adequacy requirement should be imposed.
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