A Critique of Wolak's Evaluation of the NZ Electricity Market: Introduction and Overview

20 Pages Posted: 4 Dec 2011 Last revised: 1 Sep 2013

See all articles by Lewis T. Evans

Lewis T. Evans

Victoria University of Wellington - New Zealand Institute for Study of Competition and Regulation Inc. (ISCR)

Seamus Hogan

University of Canterbury

Peter Jackson

University of Sheffield

Date Written: November 22, 2011

Abstract

This paper is the first in a symposium of papers that examine the 2009 report by Frank Wolak into the New Zealand electricity market. The Wolak report concluded that there had been a cumulative total of $4.3b (NZD) of overcharging in the New Zealand wholesale market over a period of seven years. In this paper, we introduce the Wolak findings in the context of the salient features of the New Zealand market, and explain that this headline figure is highly sensitive to some (quite unrealistic) assumptions about the structure of this market. The papers that follow this introduction examine Wolak's methodology and its empirical application.

Keywords: Wolak Report, electricity markets, market power

JEL Classification: L41, L13

Suggested Citation

Evans, Lewis T. and Hogan, Seamus and Jackson, Peter, A Critique of Wolak's Evaluation of the NZ Electricity Market: Introduction and Overview (November 22, 2011). Available at SSRN: https://ssrn.com/abstract=1968026 or http://dx.doi.org/10.2139/ssrn.1968026

Lewis T. Evans (Contact Author)

Victoria University of Wellington - New Zealand Institute for Study of Competition and Regulation Inc. (ISCR) ( email )

Wellington 6001
New Zealand
64 4 4635562 (Phone)
64 4 4635566 (Fax)

Seamus Hogan

University of Canterbury ( email )

Ilam Road
Christchurch 8140
New Zealand

Peter Jackson

University of Sheffield

17 Mappin Street
Sheffield, Sheffield S1 4DT
United Kingdom

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