Economic Fundamentals of Electricity Regulation and Markets

Haas School of Business
Room C-210, Cheit Hall
2220 Piedmont Ave.
University of California, Berkeley
Berkeley, CA 94720-1900

March 23 – 24, 2009
9:00am – 5:00pm


Severin Borenstein, Director of U.C. Energy Institute, Co-Director of CSEM and E.T. Grether Professor of Business Administration and Public Policy at the Haas School of Business, U.C. Berkeley.

James Bushnell, Research Director of U.C. Energy Institute, Co-Director of CSEM and Lecturer at the Haas School of Business, U.C. Berkeley.

Course Description

Electricity deregulation and the ensuing California crisis have dramatically changed electricity markets. Drawing heavily on the tools of economics and finance, this course will cover the regulatory and public policy issues that these changes have raised. The impacts and consequences of different strategies are evaluated in the context of the continuing changes in the organization and regulation of electricity markets.

Suggested Reading
Reading list

Course Syllabus

Learning Objectives

– Identify market implications of different regulatory strategies
– Examine electricity market fundamentals
– Comprehend basic financial instruments, hedging, and trading strategies
– Understand the relationship between retail and wholesale markets
– Explore the economics underlying transmission pricing and management regimes
– Understand market power and market manipulation, and options for mitigation

Who Should Attend?

– Management and senior level regulatory staff with minimal training in economics or electricity regulation;
– Professional staff interested in post-restructuring electricity economics; and
– Electricity industry professionals interested in understanding the economics of electricity regulation and markets.

Lecturers Profiles

Severin Borenstein is Co-Director of CSEM, a Professor of Business Economics at UC Berkeley’s Haas School of Business, and Director of the University of California Energy Institute. Professor Borenstein holds a Ph.D. in economics from MIT. His research focuses on business competition and government regulation. He is the author of many articles on competition in electricity markets and on the gasoline and oil markets. Professor Borenstein also has done extensive research on the airline industry. He has advised many state and federal agencies and state and foreign governments on energy and airline matters. He is a research associate of the National Bureau of Economic Research in Cambridge , Massachusetts . Professor Borenstein previously served as a member of the Board of Governors of the California Power Exchange.

James Bushnell is Co-Director of CSEM, Research Director of the University of California Energy Institute and a Lecturer at UC Berkeley’s Haas School of Business. Dr. Bushnell holds a Ph.D. in Industrial Engineering and Operations Research from UC Berkeley. His research focuses on many aspects of operations, regulation and competition in the electricity industry. He is the author of many articles covering such topics as auction design, transmission planning and investment, market power, and energy demand. Dr. Bushnell serves on the California ‘s Independent System Operator’s Market Surveillance Committee and has served on the Market Monitoring Committee of the California Power Exchange.