The Maryland Electricity Market: A Primer

26 Pages Posted: 21 Feb 2016

See all articles by Thomas Firey

Thomas Firey

Cato Institute; Maryland Public Policy Institute

Date Written: February 19, 2010

Abstract

In 1999, Maryland chose to join several other coastal states in restructuring its electricity markets, in an effort to bring cheaper electricity into the state to supply heavy manufacturers who were considering relocating to places with cheaper supply. Initially, this policy change appeared successful as electricity rates fell for both households and businesses.

However, by the mid-2000s, electricity rates in Maryland and other "deregulated" markets were climbing heavily as a result of climbing national demand and rising generator fuel costs. The restructuring then became branded a failure.

This paper describes the history of he electricity market in Maryland (through 2009), noting the economic and political forces that shaped the market. It also critically examines proposals in the mid- to late 2000s to change that market, theorizing their possible effects.

Keywords: Maryland, electricity, restructuring, electricity deregulation

JEL Classification: D11, D12, D24, D49, L11, L94, N82

Suggested Citation

Firey, Thomas, The Maryland Electricity Market: A Primer (February 19, 2010). Available at SSRN: https://ssrn.com/abstract=2734798 or http://dx.doi.org/10.2139/ssrn.2734798

Thomas Firey (Contact Author)

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